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In Hernando County, Sparton Electronics and Accuform defy rough economy

At Accuform in Brooksville, employee Paulette Berardi uses a razor to cut freshly laminated signs from a laminating machine. The company recently added an additional 30,000 square feet to its operations.

WILL VRAGOVIC | Times (2009)

At Accuform in Brooksville, employee Paulette Berardi uses a razor to cut freshly laminated signs from a laminating machine. The company recently added an additional 30,000 square feet to its operations.

Looking back to the start of the 21st century, many business leaders might be excused for feeling a bit nostalgic.

Compared to those boom times, recent life has been challenging — sometimes downright scary — in Hernando County, including for companies such as Sparton Electronics and Accuform. Unemployment in the county shot up to 15.8 percent, before dropping slightly to 15.1 percent, and companies struggled to adapt to a new environment.

But those two companies are still here, and officials say they're stronger than ever — retooled, efficient and ready for life on the upside. Their experience offers a primer for old-economy companies trying to ride out a turbulent, unpredictable recovery.

And as Hernando moves away from its dependence on construction as the county's economic engine, these two companies represent what county business development manager Mike McHugh calls the future of Hernando County. Both use the latest technology and provide an increased sophistication in their process and products.

Sparton Electronics

In the fall of 2008, the Sparton Corp. neared a tipping point. The century-old company was in serious financial trouble and needed help quickly.

Sparton, which provides electronics to technology-driven companies and the government, produced the first electric car horn in 1911 and listening devices for the Navy during the Cold War. But with the economy on the verge of recession, the company suddenly found itself in deep trouble.

"The company was within 90 days of bankruptcy," said Cary Wood, whom the Illinois-based company had hired as chief executive officer to turn things around. "We knew we were flying very close to the treetops."

These days, Wood's leadership of the publicly traded Sparton, including a manufacturing facility east of Brooksville, is the stuff of which business school case studies are made.

Wood had significant experience turning around distressed companies. Upon his arrival that November, he quickly hired a new leadership team, including several managers he had worked with previously.

He needed to act quickly and aggressively, but carefully. Sparton was bleeding money through inefficient use of assets. But changing too quickly could harm the existing business.

"Suppliers could disengage, or employees could give up on you," Wood said.

The new executive team at Sparton studied numerous options to make the company profitable again.

They renegotiated with suppliers and customers. "Bad contracts" were eliminated.

Wood wasn't interested in doing the type of business where one side wins and the other loses.

"There's nothing wrong with expecting mutually profitable engagements," he said.

Sparton executives reviewed their facilities, paying close attention to the age of the buildings, which can result in expensive maintenance and upkeep. They also considered action needed to improve operations and took into account the locations of customers. Within the first six months of 2009, Sparton closed three plants, one in Albuquerque, N.M., one in London, Ontario, and the previous company headquarters in Jackson, Mich.

The remaining facilities were revamped, using lean methodologies — "the absolute optimized use of every last resource," Wood said.

Wood visited each company site to convey his urgency. Assets weren't being fully utilized, the company was lacking a contemporary operating system and its financial credit had reached its limit.

The revamped, leaner operations got new training to help employees maximize their skills and time. The company shrank, but was more profitable as a result.

"Most organizations have a delineation of folks that sit in one job and when that job is over they sit and wait," Wood said. For his company, those days are over.

Sparton recently acquired two companies, bringing its operation back up to five locations, all of which are better utilized and located, Wood said.

The company has about 150 employees in Hernando County and approximately 1,000 total.

Within the last 12 months, Sparton's stock has doubled, and the company is now debt free. The company also has a significant amount of cash on hand, allowing it to invest in new technology, training and equipment.

Sparton Electronics, in Hernando, has fared well during the transition, Wood said.

"It's made good progress," he said. "I have very high hopes. I am anxious to see it achieve the threshold of performance expectations."

Just don't expect him to lower those expectations. He's still aiming high.

"It's starting to be not just a good company, but a great company," Wood said.

Accuform

Across the county in the Hernando County Airport Industrial Park, Accuform has also found success during the recession, recently adding an additional 30,000 square feet to its operations.

Accuform is best known for making signs — both custom-designed and off-the-shelf signs. And company officials love to talk about values like creativity, ingenuity, and being respectful and kind.

But when it comes to surviving and prospering in lean times, change at Accuform has meant relying increasingly on technology.

"Five years ago, there would have been open cans of ink in the production area," owner Wayne Johnson said. "Today, virtually all of our printing is high-definition digital."

Such practices have helped the company achieve its goal of being as green as possible.

"We recycle every possible piece of material we can," Johnson said.

Technology has also streamlined the design process. When a graphic designer works on a product now, the customers can sit at their own desks and watch and advise.

"It's like they are looking over her shoulder," Johnson said. "It's eliminated those hard jobs that used to be eight or nine proofs."

Now customers get exactly what they want in 30 minutes.

Accuform receives about 100 orders a day through its online system. The company has three Web developers and three on its marketing team. Together, they produce a variety of webinars and videos, all with the result of having better relationships with customers.

Those jobs didn't exist in the old days, when Accuform was more about vats of ink than pixels on a monitor. Johnson said the company has gone out of its way to make sure that technological efficiencies haven't thrown employees out of work.

"We have roughly 240 employees today — the highest we've ever had," he said. "As you add technology, hopefully it makes things better, faster, cheaper. There has to be a return on investment."

But when the technology renders a job obsolete, workers are deployed elsewhere within Accuform.

"We are committed to keeping staff," Johnson said.

Shary Lyssy Marshall can be reached at slmarshall.sptimes@gmail.com.

In Hernando County, Sparton Electronics and Accuform defy rough economy 03/26/11 [Last modified: Saturday, March 26, 2011 4:30am]
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