Peggy Finley, president of K40 Electronics, regards her employees as extended family, allowing them the time and flexibility they need to balance their private and personal lives. Her goal: to make sure employees are rewarded for their contributions and are able to enjoy the benefits.
K40, a designer and manufacturer of mobile electronic products, including CB radios, antennas, and custom remote radar detectors, is currently celebrating its 25th year in business. Located in Elgin, Ill., the company doesn’t believe in installing formal workplace programs. Instead, Finley takes a common-sense approach in treating her employees fairly and encourages them to take advantage of those programs that are in place.
She wants employees to feel they have a say in how the company is run. Indeed, employees seem to have a say in most everything at K40. Whether the concern is product-related or about benefits, there are no wrong questions or answers. Last year, when K40 switched from a self-funded to a fully-funded health care plan, Peggy asked employees to weigh in, and she considered their opinions carefully. The employees now enjoy better benefits with a PPO, and the company pays for additional costs so none of the charges are passed on to employees.
When new people are hired, they are immediately made aware of how their contribution fits into the larger scheme. They are told how what they do is important and how it affects the entire company. Every new employee is welcomed on his or her first day and made to feel at home. “The first day at work is a celebration for a new employee. We send them a plant; have business cards, pens and paper, all waiting for them. We really feel this is important,” says Finley. “People are nervous on their first day, and we want to make sure that they’re as comfortable as possible.”
This recognition continues throughout an employee’s career. K40 has a monthly incentive program called the “100 Percent Club” to recognize achievements. Every month plaques are given to employees for reaching their sales objectives. Employees value these awards and often display them proudly on their desks. “Rewards are special and personal and meant to be one-on-one,” says Finley. While it’s not a monetary reward – which is becoming increasingly difficult in this economy, especially for smaller companies – it’s a public reward that recognizes each individual’s contribution.
Lisa Senger, who started at K40 in 1986 and described herself as then being “a rookie salesperson with an attitude,” says it’s things like the recognition program that keep her and others at K40. She feels very strongly that the company invested in her, sending her to seminars and training, which helped her to grow on the job. In 1992 she left to have a baby. After a second child, she decided to go back to work. She returned full-time in 1995.
Finley has allowed Senger to work part-time for the last four years from 8 a.m. to 2 p.m., Monday through Friday. “I’m a loyal employee because they invested in me and had faith.” She says this is crucial to her being able to focus on her job and not worry about having to leave early to pick up her children from school or get them to after school activities. Senger is now the manager of sales and training.
The annual Christmas party is something Senger and other employees look forward to every year because it’s always a big secret. One year a bus pulled up with Santa in it. “We took everyone downtown to Chicago for lunch at Ed Debevic’s,” says Finley. “We gave them money for shopping and then took everyone out to dinner.” Senger adds, “That’s how the company shows its appreciation. Spouses and significant others are encouraged to come. It’s always very inclusive and well thought out.”
The inclusive nature of the company extends to children. Though K40 doesn’t have a formal day care program, it has designated a training room as the “Kid’s Room” with a VCR, videos and toys for those days when an employee’s child is sick or has the day off from school. “It makes it so much easier to concentrate on work on days like that and not be worrying about where your child is and who’s looking after them. It gives mothers the flexibility to balance their work with their life,” says Finley.
The inclusiveness also extends to K40’s suppliers. The Cary, Ill.-based contract manufacturer, General Assembly & Manufacturing Corp., has worked with K40 since 1996, and finds them “incredibly demanding in their quest for quality,” says President Paul Tomaszek. “K40 wants nothing marginal for their customers,” he adds. “It’s either perfect or it’s unacceptable. On the flip side, they are so appreciative of our people and the time it takes to get their products right.”
K40 shows its value for General Assembly’s work in a number of different ways. “They’ve brought lunch over, treated us to flowers and chocolates for Easter, and bought everyone on the staff lottery tickets on St. Patrick’s Day,” says Tomaszek. Recently, when K40 was having trouble with another supplier finishing a job, the company asked General Assembly to step in. General Assembly transfered people working on other jobs and put them on the K40 project, getting it finished on time. “Peggy came over with boxes and boxes of chocolates for the entire company!” says Tomaszek. “You see suppliers doing that sort of thing for their clients, but you don’t often see businesses doing it for their suppliers. It makes such a difference that Peggy includes everyone at our company when she thanks us for our hard work.” Adds Tomaszek, “She’s the CEO I admire most.”
In the last decade, the radar detector market has continued to shrink and the number of manufacturers has greatly diminished due to higher speed limits, traffic school and the end of the “point” system. The top three manufacturers have filed for bankruptcy in the last five years. While K40’s overall sales have remained flat, K40 has actually increased its market share. The company has not had to lay off any employees.
The company has a strong profit sharing plan, which is paid for 100 percent by K40. Since 1992, employees have received an additional 15 percent of their earnings each year in their profit sharing plans. K40 enjoys a very low turnover rate with the average employee tenure being eight years. Finley feels that employees are loyal because they know that the company has invested in them and allowed them to grow in ways not possible at other companies.
Company: K40 Electronics
Web site: www.k40.com
Industry: Electronics
Location: Elgin, Ill.
Number of Employees: 27
Sales: $6-10 million