Respect your employees and your bottom line

In 1964, two men founded a plastics molding company in this small, rural town. As the company grew, its employees kept a survival mentality, fixing things without being asked, sharing jobs, and working as individuals instead of departments.

Today Phillips Plastics makes contract plastic parts for hundreds of OEM customers. And it still applies that people-focused philosophy.

"If you had to put one sentence to the structure, it's people respecting each other," says Bob Cervenka, the company president and one of those two original founders. The philosophy has a name now-People Process Culture-and Cervenka has a new challenge: preserving it as his company continues to grow.

One method is to keep factories small-which isn't easy with 14 locations and over 2,000 employees. "If a plant manufacturing facility gets bigger than 300 people, it starts to lose the culture," he says. Another method is to hire leaders who know everybody's first name, and their families.

That insistence on multiple small factories "drives the financial community nuts," he admits. But you can't measure their value on a profit-and-loss statement, Cervenka insists. The numbers back him up-Phillips has averaged 20% annual growth over its 38 years.

From a design engineer's point of view, Cervenka's approach makes a difference because Phillips works so closely with its customers that its engineers get involved early in the creation phase of the design process. One example was Phillips' work on Dean Kamen's Segway scooter, which began with an engineer being sworn to secrecy over two years ago to work on a project codenamed "Ginger."

That philosophy creates loyal employees, says Treasa Springett, who returned to the company after working elsewhere, and in her eighth year there is now VP of Manufacturing. Decades before the rest of the business world noticed, Phillips was growing its employees with programs like career-path planning, job shadowing, mentoring, and coaching, she says.

Phillips' success hasn't gone unnoticed. It's been cited in economic research at the University of Wiscosin-Stout, and compared in textbooks to employee-centered companies like Wal-Mart and Southwest Airlines.