Pathbreaker: Isthmus Engineering & Manufacturing

http://www.retoolingcapitalism.com/2015/05/pathbreaker-isthmus-engineering-manufacturing/

Worker co-ops—employee-owned companies operating on a one member, one vote basis—are scarce in the United States. Most tend to be in low-tech, labor-intensive businesses, such as food preparation or retailing. That should come as no surprise. How many investors or lenders would be eager to fund a co-op that required a lot of capital equipment?

Isthmus - 2011.3.guys_But before you conclude that American worker co-ops are limited to such businesses, consider the black swan that disproves the hypothesis. Isthmus Engineering and Manufacturing, based in Madison, Wisconsin, is owned entirely by its 32 employee-members. It regularly does more than $20 million in annual revenue, and it’s just coming off its third record year in a row. Its business is factory automation, which is to say that it builds custom machinery for producing everything from auto parts to baby pacifiers. Words can’t quite do justice to the complexity of IEM’s products, so here’s a promotional video that will give you an idea of what the company makes.

IEM seems like an attractive model for any modest-sized high-tech enterprise staffed largely by engineers and skilled craftspeople.

The co-op structure gives everyone a sizable stake in the business’s success. It encourages long-term thinking and, well, cooperation. It eliminates needless hierarchy—project teams pretty much manage themselves. “You don’t very often have people coming in and telling you how to do your job,” one IEM employee told researchers at the University of Wisconsin’s Center for Cooperatives.

Here’s how the company works. Every members sits on the board of directors, which generally meets twice a month. “These meetings are where we make the majority of our administrative decisions,” says Ole Olson, an engineer—“who to hire, when to build a new building, etc.” Board committees handle matters like finance or shop tools and technologies; some of these committees “serve extremely important roles in the management of the business,” according to the Wisconsin study, which was conducted in 2011. A salaried general manager and sales manager, accountable to the board, are responsible for the company’s daily operation. “On a day-to-day basis, everyone here answers or reports to one of the managers,” Olson adds.

The company also has about 30 employees who are not members. All are eligible for membership–except for the two salaried managers. “The purpose of this rule is to limit how much total power and control one position might have,” says Olson. “Both of these management positions are responsible for large amounts of information that could have a definite effect on the cooperative.”

The co-op tends to add members slowly, through a rigorous application process. But the member-employee distinction seems to disappear on the shop floor. Said one member to the Wisconsin researchers:

One of the most refreshing things about IEM is in all the self regulation going on, never ever, ever, ever huge faux pas, unspoken rule…when we’re working on a team, out on a project, there is no member-employee separation. When that’s happened, when a member has tried to put that gold star on and say, “You gotta do it because I’m a member,” they have been slapped hard. Employees, on the other hand, that say “I’m just an employee,” get slapped equally hard.

What about that financing issue? IEM started in 1980 as a partnership, so the four founders and other early partners were personally liable for borrowed money. In 1983 the group became a cooperative. Before too long, the business was sufficiently successful that it could fund much of its growth internally and attract bank financing when necessary—for a new building, say.

IEM is committed to sustainability. When the company built its latest facility, it doubled the amount of insulation in the roof, installed high-efficiency lighting, and created a runoff pond to help with groundwater. It also began buying renewable-source energy from Madison Gas & Electric’s Green Power program for a couple of cents more per kilowatt-hour.

The co-op structure necessarily involves some unusual challenges. It asks employees to take responsibility for running their own business, a responsibility that not everyone wants. People have to get along well enough to keep the democracy functioning—no small matter, as any veteran of participatory organizations can tell you. All that participation in management takes time and therefore costs money, though the costs may be offset by the absence of middle managers and supervisors. When a member leaves, the company has to buy back the member’s share. IEM does so over a five-year period, thus minimizing the cash drain in any one year.

Whatever the challenges, IEM has been around now for 35 years. It is making money and growing in a business that would daunt many conventional entrepreneurs and investors.

Shift Change on PBS!

Its finally here – SHIFT CHANGE will be broadcast on Wisconsin Public Television on the following dates:

WHA-.2 WI CH Madison Sat 8/16/2014 1:00 PM Sat 8/16/2014 5:00 PM

WPNE-.2 WI CH Green Bay Sat 8/16/2014 1:00 PM Sat 8/16/2014 5:00 PM
WHLA-.2 WI CH La Crosse Sat 8/16/2014 1:00 PM Sat 8/16/2014 5:00 PM
WHWC-.2 WI CH Menomonie Sat 8/16/2014 1:00 PM Sat 8/16/2014 5:00 PM
WLEF.2 WI CH Park Falls Sat 8/16/2014 1:00 PM Sat 8/16/2014 5:00 PM
WHRM-.2 WI CH Wausau Sat 8/16/2014 1:00 PM Sat 8/16/2014 5:00 PM

For more information visit: http://shiftchange.org/

Third annual Hug ‘n’ Chug!

Third annual Hug 'n' Chug!

The MadWorC “Hug & Chug & Learn” next week on December 11th will now be in the lower level “conference room” at the Glass Nickel Pizza at 2916 Atwood Avenue.

This event is a social gathering of Madison Worker Cooperatives and is open to anyone interested in the movement. Please join us from 6 to 9 PM, Rebecca Kemble make a presentation at 7 PM about the Cooperative movements throughout the world and how we (Madison and the USA) can and will be involved.

MadWorC will cover the cost of room rental, food and beverages will be available for purchase through Glass Nickel Pizza.

Please forward this information to anyone that may be interested in the event.

http://www.glassnickelpizza.com/component/option,com_ckforms/Itemid,189/…

Shift Change at the Barrymore

Shift Change at the Barrymore

New film tells the stories of employee-owned cooperative businesses that compete successfully in today’s economy while providing secure, dignified jobs in democratic workplaces.

Where: Barrymore Theatre, 2090 Atwood Ave., Madison.
When: November 15, 2012.
Social hour at 6:00 PM, showtime 7:00 PM.
Panel discussion and Q&A following movie
Tickets: $8.00 day of show, $7.00 in advance (barrymorelive.com or 608-241-8633)

With the long decline in well-paid jobs and today’s economic crisis, millions have been thrown out of work, and many are losing their homes. The usual economic solutions are not working, and growing numbers around the world are ready to employ a different business model to help re-invent our failing economy, generate long-term community resilience and stability, and create a more egalitarian and democratic way of life.

SHIFT CHANGE visits the more than 50 year old network of cooperative businesses in Mondragon, Spain, and thriving examples of such businesses in the U.S. SHIFT CHANGE shares on-the-ground experience, lessons, and observations from the worker-owners on the front line of the new economy. Come witness and celebrate together the ingenuity and creativity of worker-owners who are “building the road as we travel” towards a more democratic, just, stable, and sustainable economy.

SHIFT CHANGE filmmakers Melissa Young and Mark Dworkin gained unprecedented access to the world’s oldest and largest network of worker Cooperatives in Mondragon—in the Basque Country of Spain, where 60% of local residents are employee-owners. With high job security and competitive salaries, the Basque Country boasts half the unemployment rate of the rest of Spain, and the Mondragon Corporation is the country’s 10th largest. SHIFT CHANGE explores many of Mondragon’s diverse production facilities; along with its network of cooperative infrastructure, education, and social services agencies, highlighting the qualities that have helped to drive Mondragon’s business success while also perpetuating the democratic, socially responsible, community-oriented principles upon which it was founded.

Here in the U.S.—where a long decline in manufacturing and a brutal economic crisis have led to millions of Americans being thrown out of work—many are looking to Mondragon as a model. Worker-owned, cooperative businesses are on the rise, with hundreds of co-ops in the U.S. today, representing thousands of individual worker/owners. SHIFT CHANGE highlights some of the vibrant worker-owned cooperatives across the nation: from bakeries to solar energy to manufacturing and engineering. Through in-depth interviews with worker-owners, attendance at co-op meetings, and visits to the factory floor, the film conveys the promise that these businesses offer to reinvent our failing economy, provide a pathway to long term stability, and nurture a more egalitarian way of life.

Businesses featured in SHIFT CHANGE include Madison’s Isthmus Engineering, Community Pharmacy, Nature’s Bakery and Union Cab. Among other U.S. cooperatives the film also features

the 7:00 PM. Screening, please stay and participate in a panel discussion and Q&A with prominent local economic activists.

The event is presented by Madison Worker Cooperatives (MadWorC), and co-sponsored by W.O.R.T, the UW Center for Cooperatives and the UW Havens Center.

Online: www.shiftchange.org and madworc.org
Facebook: www.facebook.com/shiftchangemovie ; search “shift change viewing” for Madison event page.

Tickets are available in advance at http://barrymorelive.com for $7.00 plus $1.00 service fee or on the day of the show for $8.00.

ABOUT THE PRODUCERS: Melissa Young and Mark Dworkin have produced many documentary films on social justice and environmental issues in North and South America, winning prestigious awards from CINE, Houston, Columbus, Prix Leonardo, International Wildlife, Women in Film/ Seattle, Chicago, NW Film and Video Festivals, among others. Their productions are known for diverse examples of regular people helping create positive change. Young and Dworkin’s films are in broad circulation in academic and activist settings. Five have been broadcast on PBS, most recently, Good Food [2010], an intimate look at the growers and businesses that are creating a local, sustainable food system in the Pacific Northwest. Their latest release, We Are Not Ghosts (2012) is about rebuilding Detroit from the ground up.

Madison Cooperative Business Conference Videos

The videos that follow are from the Madison City Channel. There are 8 videos and they cover the entire Madison Cooperative Business Conference: Growing Jobs through Co-Op Ownership. Unfortunately in order to watch, you must install either Microsoft Silverlight for Windows and Mac or Moonlight for Linux…Enjoy!

Download Silverlight (or Moonlight):
Windows | Mac | Linux

1. Welcome and Keynote

2. Madison’s Cooperative Economy

3. Cooperatives 101/Co-op Start-Ups

4. Financing a Worker Cooperative

5. Cooperatives in the Food System

6. Cooperatives in Health Care

7. What Can Cities Do?

8. What Can Madison Do?

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