I spent a good part of my early career working for one of America’s greatest businesses – Beatrice Companies. For most of us in Montana and the western U.S., the face of Beatrice was Meadow Gold Dairies. While the Meadow Gold brand still exists in some areas, Beatrice is long gone.
The Beatrice story is classic, from its birth in 1894 as a small creamery in Beatrice, Nebraska, to its zenith in the 1980s as a huge multinational corporation encompassing companies and brands such as Avis, Playtex, Culligan, Tropicana, Airstream, Peter Pan, and many other household names. The company’s ultimate demise was rapid, and the cause has always been pretty much a secret.
A Beatrice manager with a stellar record became CEO in 1980. According to my very reliable sources at the corporate office in Chicago, he became mentally unstable shortly after taking the reins, and the rock-solid management corp at the top crumbled rapidly. His actions were erratic, his decisions bizarre – certainly not consistent with the buttoned-down, well-disciplined playbook that had worked so well for almost a century, or with his own management record. The company’s consistent growth and profits began to wane, and in 1986 Beatrice was acquired in a hostile takeover. In a leveraged buyout funded by the sale of “junk bonds”, it was split up and sold, and the over-funded defined benefit plans were plundered. I left the company just as the final axe fell.
There are many life lessons to be learned from the Beatrice saga. The Beatrice business methods and philosophy were “old school” and tremendously effective. Every Beatrice manager learned:
- Hire good people, and treat them well. Allow them to share in the success. They will be loyal, responsible, and productive.
- Promote and move your managers between locations. They will take the best attributes of their previous company and add them to the strengths of their new company.
- There are no short cuts. The details of the business are where the money is made.
- Accounting and controls are vital. Count everything. Never allow an opportunity for someone to get in trouble.
- Quality is never sacrificed, but the path to profitability is to be the low-cost producer.
- Competition is a good thing – it allows those who work the hardest to succeed. And profit is the result of planning and hard work, not luck.
Using these guiding principles, the company grew and thrived. We were always challenged to improve performance, and were rewarded when we did. The lessons I learned from Beatrice served me well for the rest of my business career.
In today’s dismal economic environment, when we all question whether our nation’s best days are behind us, I take comfort in my memories of Beatrice Companies. Profit is not evil, it is the life blood of our economy, and the source of wealth. The “old school” business formula worked – for employees, for employers, and for the nation. It will still work, if we don’t screw it up by throwing roadblocks in the way.
Tom Balek – Rockin’ On the Right Side
And we’ve been takin’ care of business, every day!
Takin’ care of business, every way.
We’ve been takin’ care of business – it’s all mine!
Takin’ care of business, workin’ overtime.
Takin’ Care of Business – Bachman Turner Overdrive