May 2, 2013 in Business

Itronix era ends not with a bang but a whimper

By The Spokesman-Review
 

Itronix, a homegrown Spokane company that designed computers capable of surviving a 10-foot drop onto a concrete floor, didn’t survive its final challenge – being gobbled up by General Dynamics Corp.

General Dynamics, a giant company with billions in defense department contracts, acquired Itronix in 2005. In 2009 the company moved the operation to Florida, eliminating 380 high-wage jobs in this region.

This year General Dynamics confirmed it no longer makes or sells GD-Itronix laptops, tablets or handhelds, which were marketed by the company with the phrase, “real world rugged, when tough isn’t enough.”

Carolyn Zakrzewski, now a quality engineer for Spokane Valley-based Purcell Systems, worked at Itronix for more than a dozen years.

Like many others, Zakrzewski saw General Dynamics’ purchase of Itronix as a validation of the value of the GoBook line of rugged computers. She said her co-workers all believed a large owner meant deep pockets to keep the company growing and a global reach for its products.

The result was totally different, she said.

For one thing, Itronix had never been part of a publicly traded company. Once General Dynamics took it over, Zakrzewski said, company managers focused on extracting steady profits quarter after quarter.

It was also a marriage between two vastly different companies, she said.

“It wasn’t that the new managers they brought in were bad. I just think they didn’t understand the culture we had,” she said.

“We had a strong sense of camaraderie, of working together, not in silos of different departments,” she said. “They didn’t understand that.”

Itronix forged a successful business around products designed for mobile service crews, first responders and law enforcement. It became a national name and a hometown success.

Its birth was closely tied to Spokane’s Itron Inc., which makes electronic meter-reading systems. Itronix was spun off from Itron in 1993 to produce durable handheld devices for utility crews.

By 2003 the company had grown to more than 500 area workers.

It sold more than 300 laptops to the city of Spokane, most of them going to the police and fire departments. The city still uses about 180 GoBook laptops, said IT Director Mike Sloon, most of them in police cruisers.

The official statement issued by General Dynamics read: “We continually assess our business and make changes to ensure efficiency in our operations. We determined that it is in the best interest of our customers and business to end-of-life the General Dynamics Itronix branded computing products … (and) ensure customer support for products under warranty obligations will be honored.”

Matt Gerber, who was vice president of sales and marketing at Itronix through 2006, said the loss of the GD-Itronix product line is a bitter reminder to him of what could have been. Now the CEO at Liberty Lake’s IT-Lifeline, Gerber said he was part of the team that was asked by the previous Itronix owner, Golden Gate Capital, to review several bids for the company.

“If I knew then what I know now, I would have stood up and opposed the deal harder,” he said.

In his view, the management team brought in by General Dynamics failed to understand the Itronix culture and the way it developed new products. Additionally, General Dynamics focused mostly on defense contracts and didn’t understand the development cycle of tech product innovation, Gerber said.

Like Zakrzewski, Gerber said he saw the handwriting on the wall when the Spokane plant was shut down.

“That was a real shame. When they left, they took a $20 million to $25 million annual payroll out of here,” Gerber said.

He and other former Itronix workers stay in touch, using email and the LinkedIn Itronix Alumni Group to share news.

Zakrzewski said the old crew of co-workers gathers socially two or three times a year. “It’s not just five or six people, either. It’s 20 to 25 people,” she said.

“We like each other, and we try to catch up when we can.”

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