YOUR BUSINESS AUTHORITY

Springfield, MO

Log in Subscribe

Bidness As Unusual

Posted online

The Chainsaw got the ax.

Al Dunlap, up until now a corporate turnaround specialist, media darling (or whipping boy, depending on the outlet's persuasion) and chairman of Sunbeam Corp., stopped being all three of those things (excepting whipping boy) June 15. The Sunbeam board of directors fired Dunlap in the wake of the company's poor performance.

Dunlap earned the "Chainsaw Al" sobriquet from a series of corporate turnarounds he engineered with massive layoffs and plant shutdowns.

When Dunlap came on at Sunbeam in 1996, he instituted a series of cuts at the company's plants. Though left open, and its labor force left largely intact, Dunlap's cuts gutted the executive ranks of Sunbeam's southwest Missouri operation in Neosho.

The Sunbeam board fired its chairman after a meeting the week before revealed that Dunlap's previous rosy projections about the company's performance were not going to come true.

And, the possibility was put forth, Dunlap may have know they would never come true. Favorable accounting practices (to Dunlap's position) may have hidden the inevitable.

These revelations came after the board in February renegotiated Dunlap's contract under the impression of Sunbeam's turnaround. Chainsaw Al got more money and a bigger golden parachute in the event of his termination.

The board, subsequent to firing Dunlap, announced it would not pay any severance to its former chairman. This action, it has been reported, was taken on the basis that the February contract was void. Void because of the failure of Dunlap's financial projections to prove valid.

This would be little more than a corporate curiosity, or fodder for a morality play, except for the stark contrast the story portrays to important business practices in Springfield.

Cooked books, iffy projections and unsupported bluster are a clarion counterpoint to open-book management.

For another story, I had cause this past week to speak to Jack Stack, CEO of Springfield ReManufacturing Corp. and chief promulgator of open-book management. He invented the darn stuff and is a passionate disciple of his own management ideas.

Those ideas of his own are supplemented, and improved, as the system is implemented by his own companies, and those who have become devotees.

(He is also, in my book, the co-winner of the Good Sport of the Decade Award, after I managed to prominently misidentify him in a photo in the Business Journal's own pages.)

Surely, you are all aware of this management technique. It makes all employees owners through stock and opens the financial workings of business to everyone. As Stack explains it, the process imbues each employee with trust, respect and a tangible stake in a company's success.

The company benefits from the improved performance of employees and takes advantage of the innovations that well up from the ranks when those employees are given the tools of change.

Stack spoke passionately to me this week of the virtues of employee ownership in business. As spoken of by Stack, open-book management is more than a business practice, it's a revolution in society.

He says open-book management is a way to "satisfy this gap between the haves and have nots. People who got (wealth) got it by ownership. We need to be setting examples and show how the upper half really the upper 1 percent made it."

Stack is the embodiment of enlightened self-interest in business. His ideas are admirable and his actions are successful. This is not pie-in-the-sky academia. The Great Game of Business has survived the fate of so many previous flavor-of-the-month management theories because it works.

I laughingly asked Stack when Chainsaw Al Dunlap might visit Springfield to learn a few of the lessons to be learned from open-book management. I'm not holding my breath. And Stack said he long ago learned that what goes around, comes around.

The best thing about open-book management is that what goes around is good. You can figure out the rest.

INSET CAPTION:

Cooked books, iffy projections and unsupported bluster are a clarion counterpoint to open-book management.[[In-content Ad]]

Comments

No comments on this story |
Please log in to add your comment
Editors' Pick
Business of the Arts: Colorful Surprises

Murals have the power to attract and fascinate.

Most Read
Update cookies preferences