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A CEO who uses his energy efficiently

Timothy Wilson knows the importance of long-term planning and execution.

The two were essential for driving growth over the past decade at Arnold Magnetic Technologies Corp., says Wilson, 54, president and CEO.

In that time, Arnold has gone from a commodity-based business to a leader in magnetic technology development.

The company manufactures magnetic products and assemblies for industries such as automotive, aerospace, energy exploration, medical and industrial. Its products can be found on aircraft, satellites, pipeline inspection devices, missile systems, race cars and medical devices.

The firm employs some 750 people at various locations in the United States and abroad and logs average annual sales of $130 million. At the end of 2014, Arnold employed 100 people at its East Rochester site, and Wilson expects that to grow to 123 employees by year-end.

A driving factor in the firm’s growth is its continued ability to develop new materials and systems that allow customers to meet ever-increasing energy efficiency standards, Wilson notes.

“Innovation defines our future,” he says.

Career starts
Wilson is an engineer by education and training and always has worked in technology-driven businesses.

After graduating from the University of Michigan in 1982 with a bachelor of science degree in industrial engineering, he started his career as a manufacturing engineer at Welch Allyn Inc., a manufacturer of medical diagnostic devices, patient monitoring systems and miniature precision lamps.

He transferred into a new startup division there in the mid-1980s that commercialized the first video endoscopes, a device with a light attached that is used to see inside a body cavity or organ.

“It was a great experience bringing this revolutionary technology to the marketplace,” Wilson says.

While working, he also earned his MBA from Syracuse University’s Martin J. Whitman School of Management in 1988.

He left Welch Allyn in the mid-1990s to work at ENI, part of Emerson Electric Co., in Henrietta. There, he helped produce high-power direct-current and radio-frequency generators for the semiconductor industry.

Wilson describes the work as “fascinating technology and a great experience.”

After a time, and looking for an adventure, Wilson and his wife decided to move to a big city with their young family.

He took a job at Videojet Technologies Inc. as a vice president of manufacturing based in Chicago. The firm produced high-speed ink-jet printer systems for the consumer products industry. 

When Videojet was later sold to Danaher Corp., Wilson stayed on for a few years. He describes his time at Danaher as an invaluable learning experience, joking that he earned his second MBA there.

“Danaher is probably the best-run manufacturing company in the world, so it was a great learning experience,” Wilson says.

While he enjoyed his experience with large companies, though, he always wanted to run his own business in an entrepreneurial environment.

Entrepreneurial shift
Arnold Magnetic Technologies was a natural fit.

“What I saw in Arnold was an old line—100 years in business—traditional bureaucratic manufacturing company with some interesting technology that I felt could be revitalized,” he says.

Wilson joined Arnold in 2003 and ran one of its units in Ohio.

In 2005, he was part of a management buyout of the firm.

“It was a little scary at the time, but it was the inflection point of the business as now we were able to change the culture to a nimble entrepreneurial one—move away from historic commodity businesses—as well as invest in advanced technologies,” he says. “The team has totally transformed the business.”

He became CEO in 2008, replacing longtime leader Gordon McNeil, who had led the firm since 1975. Before that, Wilson had served as the company’s chief operating officer and president of North American operations.

Michael Stachura, chief financial officer, describes Wilson as a thoughtful leader and strategist who is able to look at the big picture.

“Tim does a good job of leading the team toward the direction we need to go,” Stachura says.

Wilson’s day often involves working with Arnold’s board on strategic acquisition or investment opportunities.

Other activities include discussing the technical details of a new product development program, coaching a team member, reviewing opportunities with the global sales team or conducting strategic business reviews with customers.

Wilson also does some traveling. Arnold has a couple of sites in North America, in addition to its local operation, as well as two in China and two in Europe.

“I travel a fair amount and have been able to see the world with Arnold,” he says. “However, we have developed great teams at the other locations so my travel is slowing.”

At the helm
Empowering employees is an aspect of his leadership style. Wilson believes in “hiring smart entrepreneurial people with a shared vision and getting out of the way.”

He also makes decisions based upon consensus and keeps a balanced perspective, focusing on critical items.

“It’s never as good, nor as bad, as it seems,” he says.

Dale Gulick, general manager of Arnold’s Rochester operations, says Wilson fosters a senior management team that has developed a vision for the firm.

“That vision focuses on the company’s core products of performance materials and integrating further up the value stream helping to lead our customers into cutting edge technologies,” Gulick says.

Helping Arnold succeed is its ability to adapt to a changing marketplace, company leaders say.

In 2005, for example, 70 percent of sales at the local facility came from manufacturing reprographic rolls for Xerox Corp. Arnold leaders anticipated a problem, however, as the general copier market was becoming stagnant and Xerox began transitioning manufacturing to Asia. In response, Arnold worked to reinvent the business locally, Wilson says.

Sales are now more than double what they were in 2005, and Xerox, although still an important customer, now comprises 5 percent of Arnold’s sales at this site, he says. 

The current market dynamics are good, Wilson says, driven by the electrification of systems as well as the desire from customers for smaller and lighter devices. This means using more electronic systems that are lighter, smaller and more efficient than what has traditionally been used.

That bodes well for Arnold, which manufactures performance materials that enable energy efficiency, he says.

“In a nutshell, our materials make these devices more energy efficient, such that they will consume less power from the grid, or less fossil fuels,” he says.  

As an example, Arnold has 10 to 40 systems on every commercial airplane as they become more electrified to eliminate the weight of traditional hydraulic systems.

Fuel efficiency standards for automobiles are another growing area. Current standards are 25 miles per gallon, but by 2025 the standards are required to be 54.2 miles per gallon, Wilson explains.

“If you think back to 1975 when I first started to drive, cars got about 12 (miles per gallon),” Wilson says. “So we doubled fuel efficiency in 40 years, and now we need to do it in 10. It’s a tremendous challenge, but it’s a great opportunity … to help facilitate this change.”

Arnold is also focusing on commercialization of samarium cobalt magnets, the most energy-dense and strongest material in the market. These materials allow motors and generators to run more efficiently.

Performance auto racing teams that use this material—which they can obtain only from Arnold—are achieving new levels of performance and consistently winning, Wilson says, noting the rotors Arnold makes for the cars run at speeds greater than 100,000 rpm.

He expects these technologies to migrate down to commercial vehicles. And other applications for the technology are growing. As a result, Arnold is ramping up capacity at its Europe facility to handle the demand, Wilson says.

In addition, Arnold has been working to commercialize a technology with high-speed motors that will be incorporated into customers’ designs to allow higher performance in smaller footprints.

The company also saw a need for high-speed, high-temperature motors for the automotive electric turbocharger market, which is investing heavily to meet new automotive mileage standards. 

Using Arnold’s technology, automotive company engineers are designing smaller, lighter engines with the horse- power and performance of much larger, heavier engines, Wilson explains.

“We are bringing some really cool stuff to market,” he says.

Off the job
Wilson and his wife, Teresa, live in Victor, Ontario County. The couple has two daughters, Emily, 22, and Chelsea, 20.

When not working, Wilson enjoys sports, including bicycling, car racing and skiing, especially heli-skiing, which is off-trail, downhill skiing that is accessed by a helicopter, as opposed to a ski lift.

Wilson also serves as chairman of the Rochester Angel Network, which provides early-stage funding and mentoring to start-up companies.

At Arnold, Wilson will continue to focus on new technologies and grow the business.

“The harder you work, the luckier you get,” he says.

Timothy Wilson
Position: President and CEO, Arnold Magnetic Technologies Corp.
Age: 54
Education: B.S. in industrial engineering, University of Michigan, 1982; MBA, Martin J. Whitman School of Management, Syracuse University, 1988
Family: Wife, Teresa; daughters Emily, 22, and Chelsea, 20
Residence: Victor, Ontario County
Activities: Skiing, cycling
Quote: “Innovation defines our future.”

7/17/15 (c) 2015 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.

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