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Kansas City Sprints Into the Lead

Kansas City's reputation as a telecommunications hot spot is only the tip of the iceberg for this high tech capital of America's Heartland.

  [ 3/28/1997 ]  By: Jill Metzler   Print This Article  Reprint/License This Article  E-mail This Article To A Friend  
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Sprint Corp.'s plan to consolidate its operations from more than 40 facilities throughout Kansas City and relocate 10,000 local employees into one giant Sprint World Headquarters campus by the year 2002 is a ringing affirmation of the strong business environment here in America's Heartland.

And confidence in Kansas City is something this worldwide telecommunications company -- which is largely responsible for the metro area's emerging reputation as a center for high technology and innovation -- doesn't lack.

Pending approval by the city of Overland Park, the Kansas suburb where Sprint's new headquarters are slated to be, the company will break ground in June to begin construction of a 17-building campus, featuring 3.9 million square feet of operation space. The low, red-brick facade buildings will settle into the rolling hills of the 246 acres of land Sprint purchased from Overland Park in 1990. Walkways and abundant open space (60 percent of the property will remain "green") will lend to a comfortable campus-like feel of the headquarters.

The decision to consolidate facilities and grow in Kansas City was simple for Sprint.

"Kansas City has historically been our home," explains Tom Weigman, president of the consumer services group for Sprint's long distance division. "We're a Midwestern company and we like being in the Midwest. We like having that identity."

Like many other Kansas City area companies that emphasize customer service, Sprint
relies on Kansas City employees' reputable work ethic, neutral telephone accent, and
genuine friendliness.

"A warm, Midwest personality translates well in customer service jobs," says Weigman. "We're a customer service company. Perception is everything."

This "perception" has helped Sprint achieve top ranking in customer satisfaction in long-distance telephone service from such industry analysts as J.D. Powers and The Yankee Group.

And the city of Overland Park is excited to have been chosen for the expansion.

"The zoning has been in place for six years, and we've been patiently waiting for this," says Blake Schreck, director of economic development for the Overland Park Chamber of Commerce. "We're pleased and proud that Sprint has seen fit to locate its world-class headquarters here."

The Sprint name is on yet another headquarters facility in Kansas City.

Sprint PCS is a joint partnership of Sprint Corp. and the three largest cable television companies in the United States: Tele-Communications Inc., Comcast Corp. and Cox Communications. A separate entity from Sprint Corp., Sprint PCS provides the country's first 100 percent digital, wireless telephone service.

The companies saw the Federal Communications Commission's recent auctioning of
the wireless (radio frequency) spectrum as an opportunity to join together and "get into wireless," says Tom Murphy, director of media relations for Sprint PCS. The company's communications service incorporates voice mail, caller identification and other enhanced features. In the future, PCS will also feature short messaging services, and wireless data communications.

The PCS network kicked off in Fresno, Calif.; Spokane, Wash.; Portland, Ore.; and Milwaukee, Wis. It will be available to the rest of the 65 initial markets by mid-1997, including 35 of the top 50 U.S. metro areas. Murphy says Sprint PCS has recently received licenses to expand coverage to the rest of the country, and will be operational nationally within 12 to 18 months.

Besides its headquarters in Kansas City, Mo., Sprint PCS has recently leased 35,000 square feet of space from realtor Zimmer Companies at Southlake Technology Park in nearby Lenexa, Kan. These facilities house Sprint PCS's network operations and control center, including a redundant underground network operations center and a technology center "think tank."

Sprint PCS chose the greater Kansas City area for its headquarters and operations centers because of the city's central location, lower cost of living and strong work force. Also, thanks to the presence of Sprint Corp., Southwestern Bell and AT&T, Kansas City has become known to the rest of the country as a telecommunications hub, and a logical place to set up shop, says Murphy.

High Stakes in High Tech

Local and regional developers, including the Kansas City Area Development Council, Southwestern Bell and energy companies like Utilicorp, have collaborated in an effort to lay the groundwork for attracting and retaining high tech projects. By cutting much of the red tape ahead of time and tailoring incentives to high-tech firms, these organizations hope to make Kansas City an easy choice for technology-based companies.

Besides the telecommunications giants, Kansas City has been successful in recruiting and retaining big names in industries that produce or rely on high-end technology.

Some of the biggest business news in Kansas City this past year has centered on AlliedSignal, whose Commercial Avionics Systems announced plans to bring 1,100 new jobs to the area with its new world headquarters and manufacturing facility. The Commercial Avionics Systems division makes electronics and safety systems for airline, business, government and owner-flown aircraft. The plant will consolidate operations from its Ft. Lauderdale, Fla., Prescott, Ariz., Redmond, Wash., and nearby Olathe, Kan., plants.

A final location in the Kansas City metro area has not yet been decided upon. However, about 500 Commercial Aviation employees, including transfers from the other plants, have moved into temporary facilities in Lenexa already.

"We hope to find something ASAP, because the consolidation is already underway," says spokesperson Ron Crotty. "We're not going to sit on this."

Frontier Roots

While some Kansas City area businesses have their sights set on the electronic frontier, others are determined not to forget the city's agricultural past.

"This area has been a mecca for animal health and veterinary drugs since the turn of the century," explains Wes Remington of Phoenix Scientific, a manufacturer of generic pharmaceuticals for the animal health industry.

And biotechnology is not exactly low-tech.

"This area sometimes struggles too hard to eliminate its agricultural roots," says Elaine Osborn, manager of public relations for the Agricultural Division of Bayer Corp. "The technology in this industry is mind-boggling."

Expansions at Phoenix, Bayer, and at other local animal health product companies represent continued growth in a field many Kansas City urbanites tend to overlook as one of the area's critical economic sectors.

Phoenix Scientific, based in St. Joseph, Mo., is the largest generic animal health drug manufacturer in the states and the only fully independent manufacturer, says Remington. Its facilities have expanded several times in the past few years as the world market has opened up to livestock and pet industries. The company is again expanding its facilities, which house production, warehouse and office operations, by 45,000 square feet.

In Shawnee, Kan., Bayer's Agricultural Division announced the $45 million expansion of its Animal Health facility. The new, 86,000 square foot building will house a portion of the company's manufacturing functions, and is targeted to begin operations in 1998. The expansion is part of a long-range plan to globalize the production of Bayer animal health products, and to meet North American Free Trade Agreement market demands for these products in the United States, Canada and Mexico.

Other important expansions in the animal health industry include Boehringer-Ingelheim's facilities in St. Joseph, and Fort Dodge Laboratories in Overland Park. Boehringer-Ingelheim has doubled its employee base to 532 as this manufacturer of animal health pharmaceuticals works to meet stringent European Union standards and to move into Asian markets.

In 1995, Iowa's Fort Dodge acquired the animal health care operations of Wayne, N.J.'s American Cyanamid Co., and established its new world headquarters in Overland Park.

"Year of the Caterpillar"

To compliment the many expansions on the Kansas side of the state line, the cities and counties "North of the River," including North Kansas City, Platte County, Clay County, Buchanan County, St. Joseph and the Kansas City International Airport (KCI) corridor, experienced record growth in 1996.

"We've been calling it the Year of the Caterpillar because of all the bulldozers and earth-moving equipment that dot the northern landscape," said Barry Hart of the Platte-Clay Electric Cooperative.

Quick access to the airport and major interstate highways, as well as a large land mass available and ready for building, are some of the reasons Hart gives for the interest in development.

This area of Greater Kansas City has experienced a population increase of more than 21,000 over the past five years. And with substantial commercial and manufacturing growth, as represented by the new Harley-Davidson plant construction and the recent Citicorp expansion, companies are starting to notice "Kansas City's best-kept secret" -- the Northland -- as a good business location.

Citicorp has completed construction of a $13.6 million, 136,000 square foot office building in the KCI corridor, and Harley-Davidson last year announced plans to build a 300,000 square foot manufacturing and assembly plant near the airport, bringing 500 new jobs to Kansas City by the year 2003.

It was Harley-Davidson's decision to expand in Kansas City that, in part, convinced Fargo Assembly of Pennsylvania, Inc., a manufacturer of electrical wiring assemblies, electrical components and electro-mechanical assemblies, to come to the area as well.

Fargo, which will construct a $2 million, 40,000 square foot plant in nearby Atchison, Kan., manufactures all the wiring harnesses for Harley's Sportster and Buell models ... precisely the models Harley will manufacture at their new Kansas City facility.

Fargo wanted to expand in the Midwest because much of its customer base, manufacturers of heavy-duty, on- and off-road trucks, lawn and garden tools, and motorcycles, is located here. Atchison made perfect sense, not only because of its proximity to the new Harley plant, but because it is a rural, outer-lying town.

"We've been very successful in having plants in rural areas," explains Ron Steingrubey, vice president of manufacturing for Fargo. Steingrubey says the "culture" and "work ethic" of rural employees is hard to find in larger cities.

"Rural workers have a way of finding ways to make things happen," he says. "They see problems as obstacles to overcome, not roadblocks."

The air cargo industry at KCI airport certainly faced no roadblocks in 1996, as the airport witnessed a record year for air cargo, says Michael Webber of the Kansas City Aviation Department. 1997 promises to break that record, now that Federal Express has confirmed its plans to build a $10 million, 85,000 square foot regional hub at KCI, adding 200 new jobs and tripling its current space. The facility will handle 6,000 packages per hour and consolidate air and truck cargo operations.

In North Kansas City, Joseph T. Ryerson and Son, Inc., the nation's largest distributor of metals and industrial plastics, invested over $4 million in a 32,000 square foot expansion project to add processing equipment to its distribution facility, bringing its operation space to 220,000 square feet. The company purchases raw materials from producing mills and provides industrial clients and major original equipment manufacturers with just-in-time materials, processed to specification.

Also in North Kansas City, Cook Composites and Polymers (formerly Cook Paint), manufacturers of industrial cleaners, industrial coatings and composites, and polymer resins used in a variety of industries and applications, initiated a $5.5 million renovation of its facilities in 1996.

"North Kansas City has always been a good business location for CCP," says vice president of human resources, Dennis Hercules. "We have a good relationship with the community, and since parts of the original Cook Paint headquarters were here, it made sense logistically to continue our expansions here."

Further up 1-29 in St. Joseph, Altec Industries, Inc. announced plans for expansion of its facilities, where it manufactures aerial lift devices for various utility companies. Thanks to a grant by the Buchanan County Economic Development Commission, which provided a $50,000 forgivable loan to Altec, the company will construct a 9,500 square foot product development center to house design engineers and technical staff, and a 6,580 square foot expansion of an existing building for Altec's "final assembly" activities.

Being Near the Airport Is a Big Draw

Kansas City's central location, and the fact that KCI is not a hub for any major commercial passenger airline, keeps travel prices low and flights to either coast short.

That's just one of the benefits Transamerica Life Companies, which moved its employee administrative operations from Los Angeles in 1993, and its long-term care insurance and the life insurance division's traditional annuity operations here in 1996, has enjoyed.

The company, which now employs about 460 people in Kansas City, sees other benefits of being in the middle of the country, as well, according to Mary Dinkel, vice president of sales and marketing for long-term care insurance.

For instance, the time required for mailing materials to customers across the country-- which from L.A. could take six days to reach the East Coast-- now takes an average of three days to either coast. Many employees who once lived in expensive L.A. apartments can now afford homes of their own.

And as for the bottom line, Transamerica has saved about $10 million a year in business costs since its administrative operations moved here.


Kansas City Contacts

CASS COUNTY
ECONOMIC DEVELOPMENT

Steve Castaner, P.O. Box 1052, Raymore, MO 64083, (816) 331-0488

CITY OF NORTH KANSAS CITY

Jeff Samborski, 2010 Howell St., North Kansas City, MO 64116, (816) 274-6040

JACKSON COUNTY EDC

Mary Brown, 200 South Main St., Independence, MO 64050, (816) 881-4440

JOHNSON COUNTY PARTNERSHIP

Bruce Fountain, Olathe Area Chamber, P.O. Box 98, Olathe, KS 66051,
(913) 764-1050

KANSAS BOARD
OF PUBLIC UTILITIES

George Powell, 700 Minnesota Ave., Kansas City, KS 66101, (913) 573-915

KANSAS CITY AREA
DEVELOPMENT COUNCIL

Steve Johnson, 2600 Commerce Tower, 911 Main St., Kansas City, MO 64105, (816) 221-2121, or (800) SMART KC

LAWRENCE CHAMBER
OF COMMERCE

Debi Moore, P.O. Box 586, Lawrence, KS 66044, (913) 865-4425

NEW CENTURY AIR CENTER

Lee Metcalfe, AAE, One New Century Pkwy., New Century, KS 66031,
(913) 782-5338

PLATTE COUNTY EDC

Pete Fullerton, 7505 NW Tiffany Springs Pkwy, Suite 210, Kansas City, MO 64153, (816) 891-8770

SOUTHWESTERN BELL

Brent Larson, 500 E. 8th St., Room 1344, Kansas City, MO 64106, (816) 275-1464

ST. JOSEPH CHAMBER
OF COMMERCE

Kevin Pearson, 3003 Frederick Ave., St. Joseph, MO 64506, (816) 232-4461

UTILICORP UNITED

Greg Foss, 10750 East 350 Hwy., P.O. Box 11739, Kansas City, MO 64138, (816) 467-3749

ZIMMER DEVELOPMENT

Mike Van Buskirk, 1220 Washington, Suite 200, Kansas City, MO 64105,
(816) 221-2000

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