Interstates • 712-722-1662 • http://www.interstates.com
Reprinted from Grain Journal March/April 2015 Issue
In the design, engineering, and construction industry, the term “design-build” has gained a lot of attention in recent years. Referring to a method of delivering a project in which design and construction services are contracted by a single entity known as the design-builder or design-build contractor, design-build relies on a single-point-of-responsibility contract and is used to minimize risks for the project owner and to reduce the delivery schedule by overlapping the design and construction phases of a project.
While there are clear benefits to using this method of construction, it can be difficult to distinguish who’s really “walking the talk” when it comes to beginning-to-end engineered systems – unless, of course, a company has a proven track record. In the grain industry, one of the earliest pioneers of the design-build approach (before it became a buzzword, in fact) is Sioux Center, IA-based InterStates Companies.
“We started doing design-build type projects in the ‘60s before design-build was recognized as a project delivery method,” explains CEO Scott Peterson, who joined the company in 1995 and became CEO in 2014. “Our services expanded in the ‘80s and ‘90s to include control systems design and installation. There were very few contractors that could provide the range of services that we could, especially on a national scale, and that ability is still one of our most unique features today. We work with our clients, whether they’re direct owners or GCCM (general contractor/construction managers), and we take care of the whole electrical scope of a project.”
For busy grain operators, a fully-integrated service package from a company like InterStates can save a lot of headaches adding a great deal of value to a project with the least amount of management and coordination on the owner’s part. InterStates is ready to handle all the details of creating electrical engineered systems using its in-house engineering and construction experts to get a facility up and running quickly and reliably. The company also expands its no-gap capabilities by offering full factory automation and instrumentation services.
InterStates’ turnkey approach combined with a national focus is what helped put the company on the map and what continues to give it a competitive advantage in the market.
Humble Beginnings
“We started out in 1953 as a small company doing small electrical projects around the area,” recalls Peterson. The term “small company” is somewhat of an understatement, given that InterStates was born on the front porch of founder John A. Franken’s home, where he began selling television sets to a technology-hungry community as a way to supplement his income as an operator at the City of Sioux Center’s power plant.
Along with TV sales, “Johnny’s Electric” started to install antennas and power receptacles. Eventually, the electrical business occupied more of Franken’s time, and he discontinued television sales to concentrate on electrical installations.
Throughout the early 1960s, most of the company’s business was in commercial and institutional projects including schools, churches, and hospitals located primarily in northwest Iowa. During this decade, the company began to do work with grain elevator and feed mill construction companies across the country.
In 1967, Johnny’s Electric was renamed InterStates Electric and Engineering to reflect its expanding service offerings. The company moved out of Franken’s basement to its current office location in Sioux Center.
Darrel Ramhorst, a veteran of the Air Force and NASA space program, later joined the InterStates staff and spearheaded the engineering portion of the business. Under his leadership, InterStates was able to offer total design-build electrical packages, which still account for a majority of its business today.
“When I look back at our company’s growth, I see a company that has learned many lessons. One of which is that being opportunistic is as important as being strategic in our decision making,” says Peterson. “We’ve made it our mission to help clients navigate their opportunities and that has provided prospects for us as well.”
Opportunity Knocks
Throughout the next several decades, when opportunity came knocking, InterStates opened the door to broadening its services, which has been a key factor in its growth and success.
“A major turning point in our history came when we were hired by a general contractor that was building concrete slip form elevators throughout the United States,” Peterson explains. “At the time, many electrical contractors were nervous or avoided those types of projects because of the complexity and the associated hazards.
“Our founder saw it as an opportunity to really expand the services that we offered, and that gave us national presence. We ended up following not only that general contractor around the country but others, as well, focusing on grain elevators, feed mills, and flour mills and we kept expanding from there,” he explains.
Peterson notes that InterStates was one of the first national electrical contractors in the country to offer their breadth of services, whereas many of its competitors were still regional or local, which provided the company with many more opportunities to expand.
“We just kept working on the market, and as we saw other opportunities, we started offering more services,” he says.
Staying on Top of a Changing Industry
Like other successful companies, InterStates is not content resting on its laurels. By continuing to stay abreast of industry trends and responding with innovative solutions, the company not only has been able to continue its own growth but also to ensure its customers remain competitive as well.
“It’s a much different industry than it was 20 or even 10 years ago,” Peterson observes. “We’ve done several things to respond to industry trends and one of those things is to develop I-Control.”
I-Control is a control system that enables grain handling facilities and feed milling facilities to automate the flow of grain and ingredients through their facility. The receiving and loadout functions of I-Control help operators direct grain to and from the appropriate bins and in combination with proper instrumentation can help operators manage bin inventory.
“For feed milling operations, I-Control’s batching functions allow for efficient processing and recipe management in the facility. Track and trace capabilities help facility managers with reporting and food safety requirements.
“As reporting requirements get more complex, it’s increasingly important for clients to know where particular ingredients are coming from and being shipped to,” says Peterson. “I-Control helps them track it accurately.”
We’ve also worked with elevator facilities to implement RFID solutions to help improve the flow of truck traffic at their facilities. Being able to automate as much as possible helps facilities move trucks and grain faster when it counts during busy harvest times,” says Peterson. “An automated plant is normally safer and more productive than a non-automated one.
“Automation is probably one of the biggest changes,” he says. “It’s no longer just about receiving a load of grain and putting it in a bin – it’s gotten a lot more complex, and today it’s bigger business. There’s more tracking and monitoring involved than ever before and an automated system can make a huge difference in that,” Peterson adds.
Turnkey Services
Today, with over 650 employees across the country, InterStates works hard to meet the electrical and automation needs of hundreds of clients working in diverse markets across the United States.
Under the InterStates flag, the company offers a number of professional services, including:
Electrical engineering. Electrical engineers deliver technical solutions for industrial processing facilities. Each engineer has been trained both in-house and in the field to ensure practical, constructible design.
Electrical construction, instrumentation, and prefabrication. The InterStates Construction team provides electrical construction services and instrumentation expertise that ranges from planning and prefabrication to specification and procurements to installation and startup. By planning and prefabricating as much material off the site as possible, the company reduces the site footprint while increasing safety, productivity, and efficiency.
Control systems. The Control Systems team of dedicated engineers, drafters, and programmers automate equipment, collect data, provide reporting and interface with existing business systems in order for a facility to run efficiently.
Information and technology. The use of technology to tie control systems to business systems allows access to real-time information needed to keep processes running smoothly and most efficiently.
According to Peterson, where the company really excels is in the complex jobs that are off the beaten path.
“One thing that sets us apart is our ability to do large scale projects in remote areas. If it’s a hard job, or if it’s a big job, and it’s in a tough location, that’s where we shine,” he says.
