In 1978, at the age of 69, Dr. Stanley Buckman died of a heart attack in his office. His son, Robert (Bob), who had joined the company in 1961 after earning a degree in chemical engineering from Purdue University and a MBA from the University of Chicago, became the new chairman and CEO. With sales of $29 million (slightly over 50% from six non-US countries) the companyemployed 493 people (29% were college graduates)--220 in manufacturing and 79 in field sales positions. From the beginning of Bob’s leadership at Buckman, he wanted to change the way the company operated. As he put it, “We were getting our lunch eaten. We were a multinational organization and needed to be a global organization.” He also wanted to change the management style of the organization. “I knew Ididn’t want to do it Dad’s way. Every single business decision had to be approved by my father. I thought, this is too much work.” Even though the company had adopted the slogan “Creativity For Our Customers” in the 1960s, Bob was convinced that the company was too product driven. The company now sought to become “customer-driven.” This shift reflected Bob’s belief that “cash flow is generated onthe front line with customers, by associates … who have built relationships of continuity and trust, face to face with the customer, one individual with another, over a significant length of time.”
Buckman Laboratories (A)
A key to the new approach was to expand the sales force—something Bob had tried to convince his father to do for years. According to Bob, “he wouldn’t addthem unless he was convinced they could cover cost.” No sales people had been added in the past five years. At the time the average sales person was producing about $400,000 in sales/year. Bob believed that if the number dropped to $200,000 per salesperson, per year, he still could make money. With manufacturing plants operating at 49% capacity, Bob shifted positions from manufacturing to sales.His initial goal was to increase the proportion of sales people to 25% of total employment. When that was achieved, the new goal became 30%. The combination of decentralization and an expanding “multi-cultural, multi-lingual organization” led to recognition that there was a need for a statement of organizational values. According to Bob, it “evolved out of a need to have a common understanding...