Daktronics CEO Jim Morgan Retiring After 44 Years with the Company
BROOKINGS, S.D. – Aug. 21, 2013 – Daktronics (Nasdaq – DAKT) of Brookings, S.D., Jim Morgan, outgoing president and CEO of Daktronics, got in on the ground floor of an upstart company. As a result, Morgan has seen the company grow from one with a handful of employees searching for a niche in the electronics market, to today, where it is the world's largest supplier of large-screen video displays, electronic scoreboards, LED text and graphics displays, and related control systems, services and products.
Daktronics was founded in late 1968 and Morgan was hired part time the following summer while he was a student at South Dakota State University. He got the job because Daktronics' co-founders and SDSU professors Al Kurtenbach and Duane Sander had gotten to know Morgan in some classes.
The young man's unflappable nature and apparent intelligence impressed Al Kurtenbach from the start. Kurtenbach recalled that Morgan sometimes arrived late for his engineering class, because it was right after his ROTC class, which was across campus.
"He walked in one day, and I had given a test," Kurtenbach said. "He looked around at everyone quietly working on their tests and said, 'I didn't realize there was going to be a test.' No complaint, he just went back, sat down, and wrote it out, and got his regular 'A' on the test."
That summer of 1969, Morgan was taking a summer school class before starting the master's program. One night, after he completed his studies, he ventured to a downtown Brookings establishment. Also enjoying a night out were Kurtenbach, Sander, and their wives. They invited Morgan to join them, and then proceeded to offer him a part-time position with Daktronics.
"I said, 'What's Daktronics?' I had never heard of it," Morgan said. In response, the two professors took Morgan next door to show him the small office space they had rented. "They didn't have much there. They had a couple of pieces of test equipment that somebody in town had loaned them."
Morgan finished his master's degree in December 1970. He then had a small window of time before he had to report to the army to fulfill his ROTC obligation, so he continued working at Daktronics designing and building the company's first wrestling scoreboard, trademarked Matside®. It was going to be used at tournaments in early February.
"That was a tight deadline," Morgan said. Relying on a talented student draftsman to design the cabinets, Morgan and another recently hired technician, Ed Weninger, designed the circuitry, and then hired some people to help build the scoreboards.
Morgan and Weninger met the deadline. The Matside displays were shipped to their first tournament at the Annapolis Naval Academy and Morgan followed to oversee their use. "It was very exciting. That was my first plane trip and my first product to get out there in the world," he said.
Morgan had a two-year commitment with the army, and he soon left to attend officer basic training. However, because the Vietnam War was beginning to wind down, he was released from his commitment after just three months, and he unexpectedly found himself poised to enter the job market.
"Initially it wasn't my intent to stay at Daktronics. I thought I was going to be gone for two years and I figured then I would just go out and interview at other companies," said Morgan.
Around this same time, however, Kurtenbach called. He had heard about Morgan's change of plans. Would Morgan be interested in working on a control system for a water plant in Yankton, S.D.?
Morgan was intrigued. "I thought that was interesting. I didn't know anything about a water plant. Al was just trying to find things to do to make some money while exploring potential businesses to get into. I thought, well, why don't I go back there and see what comes of this?"
Morgan came back and designed the water plant control system and got that installed. "Then we got into scoreboards and message centers, and I worked on the design of the first message center at that point. And the rest is history, as they say. I decided to stay around."
In those early years, Morgan and his co-workers pitched in anywhere and everywhere – design, assembly, testing, delivery, and installation. Long days and nights and some all-nighters were not uncommon. After he finished testing the first aquatics timing system late one evening, he and Vern Voelzke, the company's first mechanical engineer, immediately headed to Pennsylvania with the equipment for installation. Morgan crawled atop the stack of displays in the back of the van and slept until they hit Des Moines.
Ed Weninger spent his career with Daktronics after completing the Matside project with Morgan. Weninger said his respect and admiration for Morgan extended beyond working hours. "He has a keen mind. I felt privileged to work with people of that capability. In addition, Jim and I became friends, and we remain friends. Our families really grew up together."
The success of the Matside is one milestone in the company's development. Morgan has identified several others, including 1978, when he and his engineering team developed a driver circuit along with a new scoreboard control console based on the newly invented microprocessor.
Morgan commented, "The new design required just a single pair of wires between the control console and the scoreboard. That was a big deal, because before that, between the control console and the scoreboard, we needed a cable with many conductors in it . . . up to 30 conductors. The new design made installation much easier and was less expensive … and with the microprocessor you had much more flexibility with what you could do with the control console. The microprocessor was one of the big technological breakthroughs in our company's lifetime," said Morgan.
1978 was a milestone for another reason: It was the year Daktronics won an order for the 1980 Winter Olympics in Lake Placid, N.Y., which turned out to be the first of a number of Olympics where the company has been the main display provider.
"When we got that order, 1978, the company was not quite 10 years old. We were a very small company then. We were selling time and temperature and message displays in South Dakota and Illinois and Minnesota – a regional operation. In fact, it was a big deal when we sent our first salesman all the way out to Illinois in the early seventies. The 1980 Olympics, although it was still in the U.S., was an international event. After successfully completing that project I think we realized that we could compete and execute at a higher level.
"That opened doors for us on other opportunities because we had the credentials that we had succeeded at Olympic-type events. I've always felt that was one of the bigger steps for us along the way," Morgan said.
Business development aside, the 1980 Olympics "is right up there at the top for me," in terms of fun, Morgan said. "We've been in bigger events since then as a company, but compared to the size we were at the time, I think that's as big of a deal as we've had. Our Olympics team was Al, myself, and a few engineers – we were the Daktronics Olympic support team out there for two to three weeks."
Each Daktronics employee had a venue to cover as well, and Morgan's was the ski jump. 1980 was the year of the "Miracle on Ice" U.S. Hockey Team, and Morgan counts himself fortunate for the opportunity to have watched that gold medal team play several matches.
Al Kurtenbach reflected on working with Morgan for the 1988 Calgary Olympics, a project that required strategic business and project planning.
"Jim and I actually made our initial sales call by visiting the Canada House in Lake Placid. We then toured the Canadian Olympic Committee delegation through a number of venues there," Kurtenbach said. "Then in 1986 we spent nearly a week in Calgary. We toured the venues under construction, solidified our relationship with our installation contractor, and met with an attorney who helped us structure contract language to greatly reduce Canadian provincial taxes. We also laid out our proposal presentation while in Calgary. We submitted the only North American proposal and it was used as the model that all others were compared to. We won the award and it was a great project for the company. (We also won the subsequent tax audit by Alberta Province.)
"As Jim said, he and I were working together before he came to work for Daktronics. It's been a joy overall that included many challenges."
The company reached another significant milestone in the late 1990s, when blue and green LEDs became available, Morgan said. This development made full video LED displays possible, revolutionizing fans' experiences at sporting events everywhere, and fueled our growth since that time.
Morgan called a more recent milestone "transformative" for Daktronics.
"About seven or eight years ago, we realized if we were going to continue to take advantage of the growth opportunities that we had and really be successful, we needed to fundamentally change how we were going about designing and manufacturing our products. "Our adaptation of lean manufacturing, and our focus on becoming a world-class manufacturer and the progress we've made there, I believe, is one of our biggest accomplishments. Of course, we continue to leverage technology … the Internet has come along over those years and microprocessors and computers are much more powerful, LED technology continues to advance … all of those things helped us evolve along. The contributions of many have made Daktronics' success possible," Morgan said.
"I certainly appreciate the leadership team that I've had the privilege to work with; it's always a team effort at the leadership level and throughout the company to accomplish what we've done. I will miss the day to day interaction with all the great people we have here at Daktronics. It's been very rewarding. It's been great to be a part of all the successes that Daktronics has had," he said.
As of September 1, Morgan will officially retire. He will remain on the board of directors. Reece Kurtenbach will step into the role of president and CEO of Daktronics.