Concrete opportunity: A Q&A with Tom Kelley, CEO of Gage Brothers Concrete Products of Sioux Falls, SD
Editor’s note: For Sioux Falls, 2017 marked the fifth straight year of record construction. And Gage Brothers’ $40 million expansion is a big reason why.
The 103-year-old precast concrete company – whose projects include Target Field Stadium in Minneapolis, the Sanford Pentagon in Sioux Falls and the new Sanford Medical Center in Fargo – is building a 210,000-square-foot facility, designed by JLG Architects, at the edge of town.
The result should be increase the company’s manufacturing capacity by 60 percent, Gage Brothers reports.Tom Kelley has been president of Gage Brothers since 2001. He has served on the boards of the Sanford USD Medical Center, the Sioux Falls Development Foundation National Precast/Prestressed Concrete Institute Foundation, among other groups.He holds a bachelor’s degree in civil engineering from the South Dakota School of Mines & Technology and has been a licensed professional engineer in South Dakota since 1985.In this Q&A, Kelley talks about the company and the industry’s past, present and future.
In 1915, Gage Brothers' founders ‘began pouring concrete sidewalks in Sioux Falls,’ GageBrothers.com notes. What were some of the turning points in the company’s 103-year history?
There have been several key moments throughout Gage Brothers’ history, the first coming in 1946 when the brothers Al and Bill Gage returned from the war and bought an automated block-making machine. Then in the mid 1950s when prestressing was just coming into practice, Gage Brothers began to manufacture prestressed bridge girders for the interstate highway system that was just beginning to be built across the state of South Dakota.
The next mark on the timeline would be the development of burnished block the late 1970s, followed by Gage Brothers becoming just the second company in the United States to make polished concrete in 1986.
The company’s Employee Stock Ownership transition in 2007 also stands out.
Of course, we are currently building our $40 million precast plant of the future. That also has to be one of the biggest moments in company history.
What's a ‘fun fact’ or two about concrete that Prairie Business readers may not know?
Concrete doesn't have to be gray and boring, and it doesn't have to be heavy. We can make concrete in just about any color or shape; the only true limits are imagination and creativity.
We can also manufacture precast panels as thin as 1 1/2 inches.
Tell us about the ‘flying buckets’ and other automation improvements that will be found in your new facility.
The flying buckets are used to distribute concrete from the mixers automatically to anywhere in the plant. They have their own overhead rail system, which will eliminate the need to have Redi-Mix trucks and greatly reduce the time from ordering to delivery.
Another automation process in our new plant is our finished product handling. The product will be tilted up by the beds and then loaded via an overhead hoist system onto battery-operated carts. The product then will be off-loaded by an electric gantry crane. This process will eliminate nearly all of our mobile truck cranes, tractors and trailers.
Our new indoor sandblasting finishing booth is the first of its kind in the precast industry, and is very environmentally-friendly. And speaking of the new finishing process, Gage Brothers has helped developed a new finish that resembles acid-etching without the use of acid, which is easier on equipment and will also allow us to support environmental sustainability in our manufacturing environment.
I’m also very proud of our recycling system; we will be recycling all of our waste water, which is just the right thing to do.
Do you have a favorite part of the production process – a part that always makes you appreciate the miracle of modern manufacturing?
My favorite part of the production process is our people. We take sand, rock, cement and water and a little reinforcing – and out the door comes some pretty amazing things that we all get to see every day in every sector of our life.
It could be a school, stadium, hospital or high-rise office. It could be in Sioux Falls, Minneapolis or Denver.
Gage Brothers has been building communities and crafting solutions for more than a century, and I couldn’t be more proud of our dedicated team.
In 2007, Gage transitioned from being family-owned to employee-owned. What brought that decision about, and how does it affect employees today?
That is a great question. Historically, precast companies across the country started as “mom and pop” companies like Gage Brothers. Nowadays, many of those family-owned companies go the way of consolidation and are bought up by large national and international companies.
Oftentimes, these companies lose their culture in the consolidation process, and I think that as a result, they lose their identity and forget what made them who they are.
To the credit of the Gage family, they wanted something better. They wanted to maintain the family "clan" culture that has always been sewn into the fabric of the company, and the ESOP vehicle was the way we could be professionally managed and still maintain the culture.
The Gage family could have sold the business to a large company for more money, but they cared too much about their loyal workforce.
The ESOP has been great for employees. They understand that if we work as one team toward one goal through great communication, both the value of our company and the value we provide to clients goes up, which is reflected in their retirement earnings.
What's the ‘next big thing’ in construction, or maybe in your corner of it? In other words, what trends do you see that seem sure to become more important?
I think the next big thing is more prefabrication. As time and schedules become more critical and labor becomes more expensive and scarce, it just makes more sense to produce off-site and minimize the site disturbance.
Prefabrication is also more cost-effective and is produced in a controlled environment, which lends itself to better quality.
In addition, the new building codes present opportunities for more insulated panel systems, so there is tremendous growth in this arena. The days of laying brick or block one at a time versus panelized systems are definitely long gone, and I like where Gage Brothers is currently positioned.
‘Our city’s at that transition where we’re going to be more of an Omaha or a Des Moines or a Lincoln,’ you told the Sioux Falls Argus Leader. What factors helped bring about Sioux Falls' terrific growth, and how can the city keep that momentum going?
One of the major factors that helped bring about the terrific growth is our leaders. I often marvel at the giant shoulders that we get to stand on today. We have had tremendous leaders in both business and government, and today more than ever, it is paramount that we work together.
If we are going to keep it going, we need government, education and business working together – particularly when it comes to training our future workforce. We have many great organizations, but we need to smash our silos and work together for a common purpose.
We need to support and lift up everyone – and I mean everyone. Today, 18 percent of our citizens and more than 35 percent of the K-12 students in Sioux Falls are non-white or non-native English speakers. This is a tremendous opportunity and the key element to our future success.
We need to celebrate and embrace our diversity, and learn to communicate better with each other. Diversity is the spice of life.
I believe that with a new mayor in Sioux Falls, the leadership at the Chamber of Commerce and the Sioux Falls Development Foundation, along with new leaders within the regional education system that there’s never been a greater opportunity for better collaboration.