Two days before Thanksgiving Day 2021, Mequon, Wisconsin-based Charter Manufacturing announced it had bought AFS Corporate Member Aarrowcast Inc., a gray and ductile iron foundry in Shawano, Wisconsin, and quickly began demonstrating the new relationship was going to be about joining a family that looks after its own. 

CEO John W. Mellowes’ fourth-generation, family-owned steel and iron production and manufacturing company had already built a family of businesses: Charter Steel, Charter Wire, and Charter Dura-Bar. When they purchased Aarrowcast (now AFS Corporate Member Charter-Aarrowcast) from a private equity firm, the foundry was struggling, but its strengths and bright potential were clearly apparent. 

“When we acquired Aarrowcast, we knew we were bringing on board a team and a set of capabilities that were truly exceptional,” said Shane Bonner, president of Charter’s casting operations, including Illinois-based Charter Dura-Bar. “Aarrowcast has been a critical player across multiple industries, and we recognized the opportunity to leverage its unique strengths to propel us forward in the large castings market.”

At the time of acquisition, Aarrowcast was facing significant labor and operational challenges, but its potential was undeniable. “We saw a tremendous opportunity,” Bonner continued. “Our approach was clear: Invest in the team, the facilities, and the processes to unlock the full potential of this organization.”

The foundry primarily serves industry verticals of agriculture, construction, and defense. While the company boasted other molding capabilities, the turnaround would bring a transitioning emphasis on rebuilding and rebranding the foundry as a world-class, operationally excellent leader in the large castings market, leveraging the George Fisher (GF) line––the largest green sand molding flask in North America––to maximum competitive advantage. Charter Aarrowcast produces green sand castings up to 2,500 lbs. and specializes in highly-cored, complex castings. 

Points on the Board

Remarkably, the foundry has doubled the output of the GF line since the acquisition and expects to double it again in the near future, all thanks to a methodical “lean transformation” strategy rooted in employee-led Kaizen/continuous improvement––they’ve held about 20 Kaizen events at the foundry in the last two years, according to Director of Operations John Martin.

On the public relations and workforce scoreboard, Charter Aarrowcast is beating its former self in the fiercely competitive labor game. Charter brought improved compensation, benefits, and focus on engaging the team in solving its shared challenges and training. They also poured attention into leadership development and improved recruiting and onboarding processes. Bonner says they improved employee work experience in the plant through higher standards of overall housekeeping and by intentionally investing to make the foundry work easier. The results have been gratifying.

“We measure our success in an annual engagement survey, Bonner said, “Our engagement scores have skyrocketed to 82%, almost unheard of in the foundry industry. That’s a credit to John Martin’s leadership and the work that’s been happening there.

“Not only have we changed the mindset in the business, but we have changed our brand in the surrounding community as well,” Bonner added. “Today, we are an employer of choice. People want to come here now, which is really exciting.”

The ‘Why’

Though noble in its own right, righting a ship doesn’t hold up without a buoyant financial rationale. Charter’s mission as a growth organization includes identifying areas that are “nichey,” Bonner said, and hence they tend to pursue situations where being unique will be valued by the industry, market, and customers.

“Our rationale has always been to grow great businesses and strengthen our culture, Bonner said. “Charter’s business focus is on niche markets, where we can bring differentiated value to our customers. Our mission––‘Our Will To Grow Drives Us To Do It Better’––is clearly playing out with our acquisition of Aarrowcast.

“We had our eyes on Aarrowcast for some time, and we acquired the company for several reasons including the unique capabilities in the GF line and the opportunity for us to accelerate growth in large castings. Equally important, we acquired Aarrowcast because we knew there was a committed and skilled team that echoed our mission with their ‘will to grow. I can’t overstate how important cultural alignment is to us––it was immediately evident.”

The Right Investments

Year 1 as Charter Aarrowcast, the foundry worked hard while undergoing several physical upgrades. “During these difficult first years of our journey, we fully realized and embraced the fact that we were underperforming and disappointing our customers,” Bonner said. “Through some very challenging and intense times together we remained focused on being fully transparent and open with our customers. We worked to align our commitments with our performance and improve from there. Our intentions, again, were to recognize a long game in which maintaining trust and credibility with our employees and customers were going to be paramount to our future success and aspirations. We kept all our stakeholders informed of our progress and challenges and readily welcomed help and support even when it was uncomfortable.” We have come a long way, and we know we have to continue to build on that trust and performance––and we are.”

Substantial capital improvements were made to upgrade and modernize the foundry’s facilities. 

“We knew that to be world class, we had to invest in creating world-class facilities,” Bonner reflected. “Our approach was, let’s invest in this organization, the team, and the facilities, and let’s get it up to speed as quickly as possible.” 

Investments focused heavily on revitalizing maintenance/repair and operations as well as rebuilding and replacing equipment. They upgraded the shaker system and hot metal monorail and added a 100-ton holder for extra melt capacity. The company also made a significant investment in the mechanical capability, hydraulics, and technology of the GF line.

Safety and a Kaizen Culture 

Safety has been at the forefront of Charter Aarrowcast’s transformation. Their Kaizen culture has transformed how safety is practiced, largely by inviting employees into conversations of improving work every day. 

Whereas production may have trumped every priority in the past, today, safety comes first.
“Our Number 1 priority is safety,” said Martin. “We’ve empowered our employees to stop production if they see anything unsafe, and that culture shift has had a profound impact. There is nothing more important than every employee returning home after their shift in the same way they started––it’s a value and we absolutely lead with it every day.” 

Bonner added, “Our operating priorities are to safely deliver high quality product on time and at optimal cost. Those are the decision-making criteria for our team. If we can’t do it safely, we stop. If we can do it safely but can’t do it correctly, or don’t know we’re doing it correctly, then we stop. If we get the front half of this equation right, the rest of it follows.”
Over 50% of the foundry’s employees have participated in its numerous Kaizen events since 2022, and the sessions have not only enhanced safety and engagement but have raised problem-solving initiatives. 

The company recently had 18 employee-submitted nominations for its quarterly President’s Safety Award, said Martin. “The one that won was related to jam charge buckets, which is something we deal with on a day-to-day basis. We have had injuries related to that in the past, but the team looked at it and said, ‘You know, we’re going to figure out a way to fix this.’ 

“So, a group of guys got together on third shift and built a frame that would actually close the doors back up on the bucket so that they can safely remove the jams. It’s a continuing project, but it demonstrates how this team embraces our core values of teamwork, safety, and continuous improvement; the fourth one is trust, and we think we’ve built that up pretty well, too.”

Trust is a Must

Trust had to be reconstructed with customers, too, once Charter Aarrowcast started making its comeback. Early in 2022, customer conversations were not easy, Martin said, but he and Bonner were transparent with the truth and only committed to what they could confidently fulfill. It didn’t happen overnight, but today, he added, “customers are very excited. They’re looking for a growth partner. What we do here is something that’s niche, and it’s something that they need.”

“Another way of saying it,” Bonner added, “is that Charter believes if we set the customers up for success, we build that trust and credibility, and we know we’ll be supported and rewarded appropriately later. We strive to be more integrated and build deep and broad partnerships with our customers in terms of jointly creating solutions versus just shipping castings.”