HydraForce Insider Blog

The “Lee Iacocca of the Hydraulics Industry” HydraForce turns 25 pt.1

Posted by David Price on Wed, Mar 09, 2011 @ 15:03 PM

For over 25 years, HydraForce has produced the highest quality cartridge valves in the industry while providing exemplary customer service. Despite the slide in US manufacturing over the last two decades, HydraForce has defied the odds and flourished in an unstable manufacturing climate. For the 25th anniversary of HydraForce, we decided to interview our Founder and President, Jim Brizzolara, CFO Joe Reifenberg, and VP of Sales and Marketing, Tony Casale to get a history lesson on what it took to succeed in this market, and what they see in the future for HydraForce:

Twenty-Five years of growth and sustained success is a huge accomplishment in this market, how has the path treated you?

Jim Brizzolara: I feel good; this is a very exciting time for the company. There are a few things on the horizon that could make the next 25 years even more exciting than the first 25. I think we have built a very strong foundation these past 25 years. About the only thing I’d be willing to give up these past 25 years for would be to have another 25 years of youth.

Joe Reifenberg: You told me this is what keeps you young!

Jim Brizzolara: Imagine if I had another 25 years, the things we could do [with today’s technology]...

Tony Casale: But you wouldn’t have had the years of experience firmly grounding you... to make sure that HydraForce became what it is today.

What did you expect going into this venture? What did you set out to achieve?

Jim: We put together a solid business plan, so we had already envisioned the products that we’d offer. We certainly did not expect the success we had early on.

Tony: It figures that [now retired, co-founder] Dick’s forecasting would be off (Dick had been known for undershooting his forecast, that way, at the end of the year his numbers exceeded expectations).

Jim: Our experience going in to this was that no other [cartridge] valve company had ever gotten bigger than $25 million dollars. Therefore, we figured that if we got to $5 million in 10 years, then we were a success.
We began talking about this in 1981 or 1982 [amidst a recession] no one was willing to take a gamble. It wound up taking about 3 years to get an investor. In 1984, things started to turn around; we layed out our timetables for product development, executed our marketing plan, and opened our doors.
We would market through distribution. We had a potential distributor meeting that August. Thirteen distributors showed up (10 US, and 3 European Distributors), the enthusiasm for the product in that room was incredible [even though we had not yet released a single product].

How did your experience prepare you for this venture?

Jim: The first hydraulic company that I worked at really taught me how business works. In my 17 years there, they changed from a small entrepreneurial company into a branch of a much larger company through a series of buyouts. The larger the company got the more overwhelming the rules and regulations became.
I learned about various ways you could [essentially] cheat accounting, things like padding finished goods numbers, and various inventory strategies. It taught me that there were ways you could make your organization look good and not necessarily be good for the company. These experiences helped me to form the opinion that management by objective can lead you down the wrong path quickly.
The second valve company I worked for was 8 years old and completely disjointed. There had been no organization implemented whatsoever, and the company lacked discipline. I came in and spent three years completely re-organizing the entire company. What I really learned there, beyond the reorganization experience, was customer service.
The first company I worked at had gotten too big for their britches and stopped listening to the customer. In contrast, at the second company, it was common to see two helicopter pilots waiting out front to rush a product to the customer. They never second-guessed their customers. That was a great lesson learned for the three of us that were creating HydraForce.

What has been the most surprising thing about owning this business?

Jim: I think the overwhelming support we have received throughout the years from our distribution has been the biggest surprise. The credit of our success really goes to our long-time distributors. As one story goes, a larger competitor had told our original five distributors that if they did not drop HydraForce’s product line, they were going to cut them off. At the time, this company was probably doing ten times the business we were doing with them. Instead of giving in, the leadership at those five distributors came in to see Dick and I, told us what was happening, then proceeded to tell us there was no way they were going to drop HydraForce.

What fostered this loyalty?

Jim: Well, at the time there were 37 companies manufacturing cartridge valves. All of them small, privately owned companies. We knew that if we were going to succeed, we would really need to establish ourselves as the market quality leader.
At the time, cartridge valve companies were considered Mom and Pop or garage shop operations. No one had really stepped up to the plate in regards to quality. We did not want the perception of having a “Me-Too” product.

What have been the most drastic organizational changes?

Tony: The organization is not as flat as it used to be [but], it is still flatter than similarly sized organizations. We made sure in the beginning that we had a good process for everything that we do around here, and we’ve maintained our speed.

Joe: The evolution of HydraForce LTD and the entire European Market in general have been quite surprising. When I started, I never expected our European business to be as large of a part of our business as it is today.
The other drastic changes have been the many retirements. We had to fill some very large shoes when Dick, Ron Reuter (fellow co-founder and former Chief Engineer), and Julian Westwood (Distributor owner of TA Savery and our first managing director of HydraForce Hydraulics, LTD) retired, and we weren’t sure how we would do it. So far, we have been able to do it with the people we had internally. I am happy to say, people that we already had onboard have filled all these shoes, very well. That says a lot [about the organization].

About the Author:

David Price oversees training and marketing communication efforts at HydraForce Inc. Contact David

Tags: cartridge valves, HydraForce, Hydraulics Industry, compact controls

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