Engineering Tomorrow’s Solutions Today
Bastian Material Handling Corporation (BMH) has been serving the material handling industry since 1952. Originally known as the E.C. Stark Company, its founder, Elgan Stark, was William A. Bastian Sr.’s father-in-law. Back then, material handling was fairly simple. Most warehouses and factories moved their product with conventional forklift trucks and stored it in rack. Robotics were science fiction. Early computers took up entire rooms, and shipping windows were six to eight weeks. BMH’s main equipment line consisted of conventional products such as casters, hand trucks and carts, and its marketing slogan, “If It Rolls—We Supply It,” served the company well.
During the 1980s, BMH became more involved with Material Handling Systems to control the flow of products in distribution centers, manufacturing facilities and warehousing concerns. With the proliferation of microcomputers, BMH was drawn to managing the information flow that accompanied the material flow, since it was becoming clear that well-designed material handling systems were a real strategic advantage for industrial companies to quickly get their products to market and provide better service to their customers.
During this time, Bastian’s son Bill was busy studying Information Systems and pursuing an MBA at Harvard. With an undergraduate degree in Aerospace Engineering from the U.S. Naval Academy, the younger Bill had a keen interest in information movement and management, engineered systems and design. While working at his father’s company between semesters, he determined that designing systems to manage the information flow that accompanied the material flow would be his vocation.
Bill Bastian II joined the company after graduation, bringing with him his profound interest in technology. “My interest was computers and engineering; I was more interested in systems work than commodities,” Bastian II says. “So that’s the direction we headed.”
The direction Bastian II headed has moved the company from $4M in sales to well over $40M. After purchasing the company from his father in 1992, Bastian was named president in 1993. Today, BMH has an average corporate growth in excess of 21% per annum, and is recognized worldwide as a Systems Integrator dedicated to helping customers compete in their markets by providing the best material handling system solutions and technology.
The proliferation of super store rollouts, network marketing, home shopping television and distribution via the Internet are creating new opportunities for material handling distributors. Manufacturing and distribution are changing to meet the demands of a single, worldwide market, where accuracy and speed of delivery are often as important as the product itself. BMH realized early on that material handling and information systems can be used for competitive advantage in this new market, and is capitalizing on the logistics benefits of material handling systems to enable companies to reach their global customers.
“E-commerce is probably one of the most dominating issues in the material handling industry,” says Bastian. “The changes and advances in controls and information systems are phenomenal. We can put together systems that save more labor, allow more accuracy, respond more quickly from order receipt, and give better visibility in the arena of the World Wide Web.” Clients still want to know that the order was received, what the inventory level is, when it’s going to ship, and what that shipment status is. They also want the flexibility to add or take away a line item on demand. This all adds complexity to the fulfillment center.
From an inventory control standpoint, BMH is providing the hooks that allow people visibility to inventory levels. “If the customer has our back end, they immediately know the real time inventory levels and the exact status of the order—if it’s been released, where in the distribution facility it is, if it’s been manifest and put onto a carrier, and where it is in the shipment chain. This is supply chain visibility, and the customer can do this from a computer at home or at work.”
Partners for Tomorrow
Serving over 8000 customers in a variety of industries, BMH services aid in shaping critical decisions, optimizing the benefits of an integrated system. Projects vary from simple manual to highly mechanized systems involving computer-controlled storage and retrieval systems and vehicles, scanning, sortation, carousels and conveyor systems. BMH capabilities include the development and statistical analysis of inventory data, material flow analysis and simulation, three-dimensional CAD layouts, animation, RF data communications, information and controls systems architecture, order-picking and sortation software, real time management information, detailed equipment specifications, and project management, installation, testing and training.
Customers stretch across the United States and include Lucent Technologies, Anheuser-Busch, Amtrak, International Paper, Aeroquip, Epson America, Ford Motor Company, Pfizer, Chrysler, Amtrak, UPS, Shinwa USA and the U.S. Postal Service. Eighty percent of BMH’s business is repeat business.
Bastian recognizes that long-term operational savings and increased productivity for a customer lead to additional market share and profits. His customers know the value that a distributor brings to the table. “Those who use advanced material handling systems for strategic benefit will be among the successful businesses of the next decade,” says Bastian II, “so our role is to find new and better ways to help the customer. Technology enables them to be very efficient, and an efficient system is a logistics weapon that slashes order fulfillment cycle time and significantly reduces cost for each product handled.”
Fortunately, the tools to build that weapon are becoming less expensive. “Look at the price and the power of a personal computer today versus what it was five or ten years ago,” says Bastian. “The same with robotics, carousels and automated storage retrieval systems. These tools continue to get better and better and cost less and less. For a customer, automation is a strategic decision that can also provide a good alternative in a very tight labor market.”
Invest in the Future, or Be Left Behind
The innovation of new material handling products is also changing the landscape. “Many designs for conveyors and lifts have not changed in 20 or 30 years. With new materials and techniques available, these products are becoming more advanced, offering more opportunities for customers—and for us.” As an example, Bastian cites the use of power rollers instead of electric motors with chains and reducers hanging on the sides of conveyors. Modular controls are another example. “A device is now available that enables a phone cable to be placed throughout a system, replacing hundreds of wires going back to a control panel.” Light-directed picking tools, cross-docking tools, advanced controls for carousels, automated storage retrieval systems, and new technology that’s migrating from EDI to XML standards for documents being passed back and forth between businesses are becoming available to help customers compete in their markets.
“Customers demand greater variety, smaller orders more often, near-perfect quality and immediate delivery,” Bastian acknowledges. “Not meeting their demands can mean they will purchase from someone else. For them, the bottom line is simple. Invest in the future, or be left behind.” Bastian points out that the company remains very flexible as new technologies emerge, and he looks for sound application opportunities.
People, Technology and Strategy Result in Success
With all the technological advancements, engineering know how and technical whiz-bang, Bastian believes that the successful distributor still has to concentrate on the basics. “You must have good people who enjoy what they’re doing, and they should have fun working as a team. The environment we work in is extremely important. That environment will always be important.”
Bastian Material Handling employs 80 people, including 37 engineers. Headquartered in Indianapolis, Indiana, national coverage is provided by regional offices in St. Louis, Missouri; Grand Rapids and Detroit, Michigan; Fort Wayne and Evansville, Indiana; Cincinnati, Ohio; Lexington and Louisville, Kentucky. Despite the tight job market, BMH employees are eager to work for a company with this goal attached to its mission statement: “We want a company that our people are proud of and committed to, where all employees have an opportunity to contribute, learn, grow and advance based on merit. We want our people to feel respected, treated fairly, listened to, and involved. Above all, we want satisfaction from accomplishments and friendships, blended personal and professional lives, and to have fun as we compete in the marketplace.” Potential employees are recruited from the military and industry. BMH also visits college campuses and job fairs and is also experiencing much success with Web-based advertising.
Bastian says his greatest challenge is maintaining a great culture within each office. “It’s very important that employees have fun, respect each other, provide good service to our customers and grow. I spend a lot of time making sure that the human factors are right so that people do have fun and can concentrate on the work at hand.” Of course, it was easier when there was one office with a few employees. “Now it’s harder and I have to depend on managers in various states.”
Bastian takes seriously his role to make sure that each and every individual employee is successful and meets their goals. “I work hard to make sure I’m providing them with opportunities to be successful. One of the most fulfilling things are the successes that our employees have. By the same token, helping them through difficult issues is challenging and not taken lightly.”
In 1997, BMH purchased majority interest in ASAP Automation, Inc. Located in Louisville, Kentucky, ASAP specializes in software and control system solutions for manufacturing and distribution. Much of the software and controls used by BMH are designed by ASAP, including multimedia diagnostics, RF solutions, laser data terminals, light directed picking and put away.
In 1998, Bastian and ASAP created a wholly owned software development company in Bangalore, India, AAI India Private Ltd., to provide additional software development resources for ASAP. It is not unusual for American companies to offload programming chores to Indian workers, as the country’s technical schools turn out highly skilled software programmers and computer professionals. Currently, AAI has six employees who are producing computer code. While workers in India are less expensive than American computer programmers, Bastian acknowledges that the savings are limited when everything is factored in, such as travel expenses and time. “As it grows, we’ll get more economies of scale as a by-product of India’s lower pay rates. Right now, the major benefit is access to skilled computer programmers.” Bastian visits the site every few months, and AAI employees spend several months working in the United States.
Engineering Tomorrow’s Solutions Today
“I’m optimistic,” Bastian declares. “The material handling industry will continue to grow and be strong. For E-commerce to work, manufacturers must get their products to their end-users, and we’re the guys behind the curtains that help do that sort of thing. Bastian Material Handling has a great team of workers. We have wonderful relationships with over 300 suppliers who are almost extensions of our company and we of theirs. We are very fortunate to have such good cooperation and strong partnerships.”
As a systems integrator, BMH will continue to seek out leading technologies in both material handling equipment and information systems coupled with proven operational strategies. “Our success will continue to be dependent upon our ability to hire and retain the best people, along with our ability to maintain strategic supplier partnerships that provide the most value for our clients,” says Bastian. “We greatly enjoy what we do and feel that our efforts are instrumental in making U.S. businesses stronger and more competitive in world markets.”
As he runs a multimillion dollar company on two continents, strategically plans new systems to assist customers to become more productive and profitable, develops relationships with suppliers and subcontractors throughout the world, and makes sure his employees have fun, what does this former Naval officer, Harvard graduate, engineered systems visionary worry about? What keeps him awake at night? Bastian laughs and says, “my kids’ homework.”
And they are some very lucky children! Their grandfather, Bill Bastian Sr. built Bastian Material Handling on a strong foundation of commitment and dedication to the goals of helping customers, partnering with exceptional suppliers, and building a very talented team of creative and spirited employees. Their dad, Bill Bastian II continues his legacy, moving it into the 21st Century.
Customers look to Bastian Material Handling as their source for innovation, efficiency and productivity, and more than one supplier and customer refer to BMH’s president as “the Bill Gates of the distributor systems industry.” Bastian’s interest is using technology to help businesses gain an edge in their markets. “As the pace of business and information technology continues to accelerate, we look forward to meeting our customers’ new business challenges with creative material handling solutions that provide a clear competitive advantage.”