This mini-cast is a #FiduciaryFlashback excerpt from The ESOP Podcast Episode 49.
Aaron Moberger of employee-owned Mass. Bay Brewing Company, known for Harpoon Brewery, UFO Beer, and Clown Shoes Beer, talks with us about how employee ownership can further strengthen the culture at an Independent Craft Brewer and lead to continual process improvements. An ESOP increases employee engagement, which can make a good work environment even better!
Aaron Moberger is also an active member of the leadership of the New England Chapter officer at The ESOP Association. This episode was recorded on Friday, October 12th, 2018 a The ESOP Association 's New England Chapter's Annual Fall Conference in Mystic, Connecticut.
Mini-cast 34 Transcript
Brian Keisling: 00:01 Welcome to the ESOP Mini-cast brought to you by Capital Trustees. A great way to wrap up the week.
Brian Keisling: 00:22 Hi, everybody and welcome to The ESOP Mini-cast. This is Brian Keisling with Capital Trustees and today on the Mini-cast we have a #FiduciaryFashback for you. We will be throwing it back to episode 49 of The ESOP Podcast where Bret sat down with Aaron Moberger, who is the cellar manager at Harpoon Brewery as well as an active member of the leadership of the New England chapter of The ESOP Association. This conversation that we're playing a clip from was recorded in the fall of 2018 at the New England Chapter conference, so bear in mind while you listen that there will be a little bit of background noise because they were recording in the conference. Also, something to pay attention to while you listen is how Aaron talks about how, prior to becoming an ESOP, Harpoon brewery already had a strong employee culture, but that culture was strengthened after going ESOP. Aaron will discuss how not only did the culture improve, but the efficiency at the company improved as well. It really highlights what you hear Bret and Rich talk about all the time on the podcast about how an ESOP won't turn a bad company into a good company, but it will take a good company like Harpoon Brewery and help it become even better. With that, we hope you enjoy this clip and that you will join us again on Tuesday with a full episode of the ESOP podcast.
Bret Keisling: 01:45 So talk a little bit -- earlier in this recording, you had referenced that one or two things were employee initiatives, which I assume is tied to it being employee-owned.
Aaron Moberger: 01:55 Yes.
Bret Keisling: 01:55 So talk a little bit about the effects of being an ESOP on Harpoon. How's it changed your company?
Aaron Moberger: 02:02 What's, yeah, I had a really good culture to begin with, so it's, um, it wasn't like flicking a switch or something like that, where all of a sudden we're employee owned and we've got an ownership spirit. It's an ownership spirit before that, but of course you need the, you need the ESOP component as well.
Bret Keisling: 02:23 Right.
Aaron Moberger: 02:23 So I would, I guess, it just sort of augmented a lot of the good things that were there already. People care more, people will figure out how to use our continuous improvement program. You know, or we've really, we had initiatives before that we formalized the program, track it. I think the results are very tangible that, you know, just talking locally in our cellaring department in Boston we've increased our efficiency by 50%.
Bret Keisling: 02:53 50%?
Aaron Moberger: 02:54 50%.
Bret Keisling: 02:54 Wow, very impressive.
Aaron Moberger: 02:55 Yeah. Honest to God. Yeah. Thank you. It's all people's ideas. That's the coolest thing! We were doing -- before we were an ESOP company -- we struggled to put six batches through our finishing system, so the centrifuge and a lot of times that filter in a day, and we do eight, nine or ten now. We did eight batches of beer through a filter head twice and it was a challenge, before that, and we just did 12, we did 11 a couple of times in our sleep. Really it's, we could go probably the whole week on one filter head now.
Bret Keisling: 03:30 Wow.
Aaron Moberger: 03:30 And that wasn't for many new pieces of equipment. That was from a cellar operators figuring out better ways, grassroots better ways to do things.
Bret Keisling: 03:39 Which is what we like to see in employee owned companies -- we like to see it in any company -- but obviously our focus is on ESOPs, where the employees understand with some skin in the game they benefit from the results. So finding a way to bring down expenses or innovate your processes is very much a natural component of being an ESOP.
Aaron Moberger: 03:59 Yeah, it's a natural component. It's something that people, I would say people have a natural drive to do. I think the constructive part of it is having a system that helps to people to use that and the best way possible. You know, if people do have these ideas and certainly they know, you know, we can, we can make a very safe assumption that people who are doing those jobs every day know how to make them better. They don't have an outlet for that. It can be frustrating, you know? And it's, it's far, as far as I know, there's no perfect system. So, you know, we've had to work hard to get to the point where we see those types of results and it's still not perfect. We've come up over the past several years, just the ones that we've tracked, 200 ideas and 60 are completed. So we're at, we're at a 30% which I have no idea what world class is in terms of idea, systems, but 30% seems to leave an awful lot of room for improvement.
Bret Keisling: 04:52 Right, right.
Aaron Moberger: 04:53 But obviously there's still tangible results in people take a huge amount of pride, you know, our folks take a huge amount of pride in what they've done and it really helps me get... So, when the market's shifted and you have 7,000 breweries for the first time from six, five, you know, for a couple of years ago. And you have to continually innovate to keep people interested and get, you know, really good faith in consumers to stay relevant and all that kind of stuff. If we hadn't made a lot of those improvements, which we're doing for the sake of doing them and you know, making our jobs better. Adding shared value, now of course, as a result of those things, it would have been much more difficult to keep up with the adjustments that have had to make since then. You know? So if we, if we couldn't put eight batches through, you know, in a day and all of a sudden we had to make all these other changes, you know, maybe we would, at that point we would have been putting two quads of IPA through and it was sort of a standard thing and now we might be doing a quad of IPA and before other batches. So there's transition time between those things that we would have had to absorb it if we weren't out ahead of it, it would have caused problems.
Bret Keisling: 06:02 And ultimately, and it's just human nature. In traditional companies that aren't employee owned, the end of the work shift comes, you're not necessarily motivated to think about it, care. You know, you take your check, we assume, you know, put in honest service for the check. But there was that extra component of wanting to go further.
Aaron Moberger: 06:21 Yeah.
Bret Keisling: 06:21 Because you have a piece of it.
Aaron Moberger: 06:23 Yeah, absolutely. And that's a great point about continuous improvement, is that people need some time away from their normal work to be able to come up with the thought for these things. So whether that's after hours or whether you do enough of them, that people can find chunks of time during the day around their normal work to be able to do it. It's a necessity, you know?
Bret Keisling: 06:44 Sure.
Brian Keisling: 06:46 If you, or someone you know, has experience in the cannabis industry, especially as it relates to cannabis and ESOP's Capital Trustees would love to hear from you. We are putting together a podcast episode on ESOPs and the cannabis industry. So if you have that area of knowledge and would like to reach out, we can be found at firstname.lastname@example.org. We'd love to hear from you, pick your brain, and potentially have you appear on the podcast. Again, that's podcast at captrustees.com or you can find us on our website and give me a call. Thank you very much and have a great weekend, everybody.