From Concept to Reality – Designing for Sustainability
Fourstar Connections of Hudson, Massachusetts is a connections solution provider for manufacturing companies and much more. What started as a cable assembly shop grew into an innovative entity that helped technology companies reduce the time to market and enhance product performance. We spoke with President Phillip Holman about the business and its future enterprises.
Fourstar Connections was founded in 1986 to assemble electronics cables. By 1999, the company peaked with 130 employees, building $10 million in cables. The recession of 2008 saw it drop to sixty employees, but the company survived and reinvented itself to support new product introductions (NPIs). New products pass through the NPI process from design to prototype and eventual introduction to the market.
“We had become a commodity cable shop and realized that we didn’t really want to be in that business, as the gross margins were horrible. So, we rebranded our purpose and message in 2013. Eventually, we did $10 million in sales for 2010, with a break-even year, because we have such low margins,” says Holman.
The company now sells cables and other interconnect solutions to technological original equipment manufacturers (OEMs) headquartered in New England. “We sell through a philosophy of getting an intimate knowledge of our customers’ needs around NPIs. Our relationships are typically with senior supply chain managers, engineering managers and quality assurance managers,” says Holman. It is an electronic manufacturing services provider for three primary markets: medical instruments, custom test equipment and aerospace or commercial aviation. It also supports customers in robotics and industrial automation.
Fourstar appeals to technology companies that were originally vertically integrated but, over the years, have gone for more outsourcing in their supply chains. This, in turn, has created a void in supporting new product introductions. These companies need a partner to get new products launched, and this is where Fourstar comes in.
Holman acknowledges that although working with clients on new product introductions does not guarantee long-term business with them, many will elect to stay with Fourstar on seeing the value it brings. “With the rebranding and the value that we bring on the NPI side, they will tend to leave that package with us—either indefinitely or longer—than if we didn’t have that relationship,” says Holman.
Fourstar’s prices will always be scrutinized, but technology companies are willing to pay more to have a partner that can perform NPI, and this is one of the main reasons for its success. According to Holman, it is empowering for the company to sell turnkey solutions, as this involves offering a wider range outside its normal products, and the company must “work closely with affiliates and others in the industry trying similar things. We put a consortium together based on the project needs and provide complete solutions.”
A recent example was when Fourstar was approached to create a lithium-ion battery system for a warehouse that is much lighter and has longer use time than traditional lead-acid batteries. The company did not know anything about lithium battery technology, so it allied with a battery manufacturer. Fourstar built the docking stations and electronics for charging, and the partner built the lithium-ion battery.
“If you asked me six months before we started this project that we would be building a lithium-ion battery solution, I would say you are crazy,” says Holman. “But, in the last two years, there are many examples where we have gone outside of the core, built a team of experts through affiliates and built full turnkey solutions.” The company has discovered that there are virtually no limits to what can be accomplished this way, and clients are recognizing that Fourstar has the capabilities to do most things.
The main industry for which Fourstar works is medical devices, but recently it has ventured into the field of robotics. It participated in the original design project for the Kiva order-fulfillment robot, which is now owned exclusively by Amazon. Fourstar is still a supplier of the cabling, including the security wiring for the order fulfillment workstations.
Fourstar also participated on the original design project for Rethink Robotics “Baxter” project. This had some challenging engineering issues related to the flexible environment in the robotic arm.
“Currently, we are supporting some engineering work with Symbotic and have been in discussions with other robotic start-ups, such as Locus Robotics and Soft Robotics,” says Holman.
Fourstar just celebrated its thirtieth year and strongly believes in long-term relationships with its customers and suppliers. For all thirty years, it has had a relationship with Sager Electronics. It has worked with Heilind Electronics for twenty-seven years, with Syneron Candela for twenty-eight years and with many others for over twenty years.
“The way you keep long-term relationships is by providing a high value of service and running your business with integrity. Most of our new customers are either referrals from existing customers or suppliers, or employees who leave one company and then call us as their new company to do business,” says Holman.
Sustainable manufacturing is a cornerstone of Fourstar’s business plan. It has implemented a business model driven by sustainable manufacturing practices, which supports its own infrastructure and customer goals through design for sustainability initiatives. The strategy began with a solar array on the roof that now provides between seventy and eighty percent of its power.
This and other initiatives have been well-received by its customers. To further its commitment to customers and the community, Fourstar is producing an annual sustainability report, voluntarily reporting to the Carbon Disclosure Project and setting sustainability indicators with multi-year goals. “Our goal is to prove we can be sustainable and add to our profitability at the same time,” says Holman.
Fourstar became the first company in the state to receive a Massachusetts Workforce Training Grant for sustainable manufacturing. “We submitted it, held our breath, and within a two-week period, we got the official approval with no recommendations for changes. It was approved as submitted, and now we are trying to include some of the companies we work with that have sustainability initiatives to also apply, as we set the bar for the State of Massachusetts,” says Holman.
Fourstar is quite active in sustainability issues, and its senior management team recently attended a conference in Philadelphia at which Holman sat on a panel to discuss the challenges of supporting sustainability initiatives when publicly-held and privately-held companies intersect.
“There is a misconception that privately-held companies do not need to worry about sustainability, but as a privately-held company who sells to mostly public-traded companies, we need to be able to support the reporting initiatives of our customers. There is another conference we hope to attend in June of 2018, in Vancouver, BC,” says Holman.
Because Fourstar does not differentiate between sustainability and social responsibility—approaching it more from a “people-driven” mindset—the company practices sustainability on a human and community level. It volunteered with its insurance company to support a three-year program for improving the overall health of its employees. This includes weight loss programs, personal trainers, yoga classes and more.
“We also give back to the community by supporting the Interfaith Hospitality Network (IHN) of (Greater) Worcester through fundraising and supporting their shoe drives. We donate turkeys to VFW (Veterans of Foreign Wars) of Hudson to support their meals programs for both Thanksgiving and Christmas. We have a long history of supporting local charities and for promoting employee participation in these programs—often by providing a company match,” says Holman.