Meet the new owners
Figure 1: NCC Automated Systems employees give President Kevin Mauger a standing ovation after learning the company is becoming employee-owned.
Formed in 1986 by a former Intralox belt salesmen, the southeast Pennsylvania-based NCC was created with the purpose of building custom, sanitary conveyors. It eventually grew into conveyor systems integration and by the late ’90s became a full conveyor systems integrator.
Today, the company does most of its business outside of the Pennsylvania region with a concentration in food, its largest business, followed by ophthalmic lens manufacturing and conveyors for the assembly industries. “We buy what we can and build what needs to be customized, plus we have our own product lines that we build very well,” Mauger says.
NCC considers its primary product how it builds its own conveyors and control systems, calling itself “an integrator that manufactures.”
You down with ESOP?
Mauger joined NCC more than 23 years ago, when he was a college student running a neighborhood handyman business. NCC’s founder had offered Mauger the job before he left for his final year of college.
“I graduated on a Friday and started the following Monday and have been here ever since,” Mauger says. He went on to purchase the company in the mid-90s when it was actually $1 million insolvent. But for the past 11 years, NCC has posted a profit with 23% year-over-year growth.
“The key to our success is our people, our focus and our ability to know how to run custom specific projects,” Mauger says. It made sense that after witnessing this continual growth Mauger would find a way to spread the success to the good people around him whom he felt were responsible for the prosperity.
Over the years, Mauger always considered himself a “project guy” as he likes to solve the challenges that his customers face. But at this point in his career he’s all but run out of projects, having delegated those responsibilities to other capable hands. As sole owner, Mauger realized that he was in a position where he could change people’s lives for the better.
“I’ve been thinking about this for years,” he says about the ownership plan. Mauger first heard of the idea five years ago at an after-hours class and fell in love with idea. He started to read more about it and began to meet with many people about ESOPs. He finally pulled the trigger on a formal feasibility analysis in late 2016. “It took three months to know it was the right thing to do and five months to structure and execute the deal,” he says.
There were lots of challenges in the process and required Mauger coordinating actions, lawyers, five consultants, three bankers and four more financial advisers. While simple to employees, the transaction itself was complicated and required big decisions.
Navigating change
At this point, not much has changed in terms of NCC’s day-to-day operations, but Mauger knows that the road ahead won’t be simple. To help, he will continue in his current position for the foreseeable future, especially as Mauger sees areas such as 3D printing, artificial intelligence, machine learning, Industry 4.0 and overall software improvements being disruptive to its operations.
Fortunately, Mauger has seen that employees are already thinking like owners. “People are more apt to make decisions for the good of the company as the basis of their decision than previously,” he says. “Though many already thought that way.”
Mauger is hopeful that other business leaders take notice of what NCC has done as he believes that emotion, culture and giving employees opportunities are the x-factors that make a company great. “There are lots of good and even some great companies out there, but there are not that many that are truly special,” he says.
NCC’s future now is tied to all of its owners. “We have complete control to determine our own destiny and decide how we want our company to look, feel, operate and develop,” Mauger says. “Together, we can do so much better as a fully committed, well-aligned team. The ESOP supports this cause. If we can all power forward in the same exact direction, all helping each other, like a perfectly-executed football play, we can do anything.”
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