Case Studies

Peterson Sheet Metal

Looking to fast food, the company uses a manufacturing approach

People laugh when Jaime Quello tells them one of the businesses he respects most is McDonald’s. But he’s serious.

Wherever you are, when you walk into a McDonald’s, it’s the same as all the others. The company doesn’t know if two people or 200 are going to show up for lunch, but regardless, they can serve a hamburger in five minutes.

Quello is CEO and president of Peterson Sheet Metal, an HVAC contractor in Bemidji, Minnesota, about 200 miles north of Saint Paul. Quello respects McDonald’s’ speed, flexibility and consistency, and he wants to bring those qualities to Peterson Sheet Metal.

Peterson Sheet Metal

To do that, Quello is making construction more like manufacturing. He encourages Peterson Sheet Metal to do as much work as possible in the company’s pre-fab shop and to keep its equipment consistent. He hopes to reduce the variables that so often complicate construction projects.

Consistency is key

Peterson Sheet Metal typically works in Minnesota, North Dakota, Iowa and parts of Wisconsin, but it has taken jobs as far away as Georgia, prefabricating as much of the project as possible regardless of location.

“I always say our one job is to reduce the variables,” Quello says. “I’m constantly trying to reduce as many variables as possible because, if we can at least reduce as many as we can here in the shop, out in the field it saves them a lot of time.”

When the company contributed to Minnesota State University’s (MSU) clinical sciences building, for instance, it assembled 20-foot-lengths of pipe, with Ts and valves included, in its Bemidji shop. Then the company shipped those pipe assemblies to MSU in Mankato, about 300 miles away, and installed them onsite.

That was a critical advantage on the MSU job because southern Minnesota got 58 inches of rain the summer of construction. For most contractors, the rain was a nightmare, but by prefabricating as much as it did, Peterson Sheet Metal minimized complications because it didn’t have to do as much work on a wet, muddy job site.

The rain wasn’t the only challenge on that project. The MSU building was unique in that it’s designed as a semicircle, so Peterson Sheet Metal didn’t have a single square wall to work with.

“The problem with construction is every job is unique,” Quello says. “It’s always our goal here [to say] how do we take this uniqueness and how do we take the repetitiveness of the things we do and put that into a job?”

That’s why consistency is vital. The company uses one make of truck—Dodge and Dodge-Cummings—so that its in-house mechanic can customize one type of vehicle and can swap spare parts between vehicles when appropriate.

When possible, Peterson opts for Milwaukee Tool equipment and drains by Zurn Engineered Water Solutions. That way, employees are familiar with the same products and the same carriers. They can work faster, and they’re less likely to make mistakes.

“If someone wants a special toilet or air handling unit, I’m not going to deny that,” Quello says. “I think that’s great, but everything that connects to that, let’s try to make as consistent as possible. Let’s reduce the variables.”

The winning team

What separates Peterson Sheet Metal from its competition, Quello says, is not its trucks, tools or equipment—it’s the people. When Quello first joined as a project manager in 2001, Peterson Sheet Metal had 11 employees. Fifteen years later, it has more than 100 employees, and taking care of those employees has enabled the company to grow and to rebound quickly after the Recession.

Because Peterson Sheet Metal does as much work as possible in its shop, its employees have to travel less often than they would if the entire project was done at the job site. Employees seem to appreciate that, and they stick around. Many have 10-or-more years of experience.

“I like to think we’re a bottom-up company. The guy sweeping the floor is just as important as the guy in the top office. Everybody’s opinion counts. Everybody’s job matters.”

All of Peterson Sheet Metal’s foremen carry iPads, so when they are on the road, Quello encourages them to FaceTime their families to say goodnight. Family is always first, Quello says, and weekends are sacred.

“I like to think we’re a bottom-up company,” he says. “The guy sweeping the floor is just as important as the guy in the top office. Everybody’s opinion counts. Everybody’s job matters.”

Quello encourages employees to share their ideas. He tells them that if they have a “dumb idea,” to stop what they’re doing and come share it with him as soon as possible.

When one employee had a “dumb idea” to make a pushcart with two wheels instead of four because he thought it would be easier to push, the company tried it. Then they modified the design to add four more stabilizing wheels, and now they use the six-wheeled cart regularly.

“We need to try different things to keep moving forward,” Quello says. “What you don’t want to do is be so afraid to do the wrong things that you’re not doing the right things. You need to focus on the right things, and if you do the wrong things, oh well, we’re going to move forward.”

Over the years a few employees have left Peterson Sheet Metal for jobs at other companies, but they always come back.

When one such employee got headhunted, he went to Quello and explained the situation. Quello told him, “This is a great opportunity. I hate losing you as an employee, but I’m not going to hold you back as a friend. See what happens.”

Nine years later, that employee came back to Quello and asked if Peterson Sheet Metal would consider opening another branch closer to Minneapolis. Quello agreed, and now, as the company looks to expand, it will be up to that returned-employee to help build the same every-employee-matters philosophy at the new location.

“I try to breed a culture of winners,” Quello says. “Winners always want to go out and win, and if you treat people like losers, losers are always going to want to go out and lose. So you treat your people all like winners.”

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Spring 2018

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