A little spring manufacturer, on the surface not much different from hundreds of others, lost almost 10 percent of its business last year when a medical-device parts job they had for 20 years disappeared.
"We had already forecasted that $600,000 in business," said Norm Rodriques, co-owner of Springfield Spring.
How the little spring company responded shows why it's not like all the others.
Rodriques set a goal of replacing that revenue with new accounts over 15 months, and set up a spreadsheet that lists every contract landed and its dollar amount. He and co-owner Tina Malley named it The Cook Report, after the company that suddenly pulled out. But they not only acknowledged the setback in the title, the spreadsheet's information was open to far more than sales staff and managers. Anyone in the company can call it up in the internal system.
The spreadsheet is one example of just how few secrets there are at Springfield Spring. Every month, Rodriques and his partner hold an hour-long meeting at each of the company's two factories. They share a detailed score card of sales, shipments, backlog, returns, discounts, costs of goods sold, gross profit, operating expenses and pre-tax profits -- and whether those categories are up or down year over year -- with all 47 workers, from operations manager to four-slide press operators to shipping clerks.
It's part of a philosophy called Open-Book Management. It's been around 29 years, but rarely put into practice, even in employee-owned companies, which Springfield Spring is not.
Rodriques says: "It strips out the [bull]. There's nothing to hide."
Sara Vazquez, who works on the floor of the Bristol plant, said she loves it. "There's nothing we don't know here," she said. "They treat us like an owner."
Operations Manager Ryan Naideau, who was promoted up from a job on the floor, calls Rodriques, who's 55, the Energizer Bunny. "You can't shut him down," he said.
He's far from diplomatic. When he gets started on big box stores and large multinational corporations, and how they drive manufacturing outside the United States -- well, let's just say he has strong opinions, and an earthy vocabulary. And he's no more cautious in talking about his own company. "We make springs," he said. "They're about as boring as waiting for paint to dry."
Rodriques started the policy out of selfishness, he said.
He and Malley had borrowed $3.5 million to buy out two other partners who were retiring in 2000. At the time, the company had $3.9 million in annual revenues. When the 2001 recession hit, sales dropped to $3.6 million, then $3.3 million.
"I was tired of lying awake at night, sometimes throwing up, not sure if I was going to make payroll," Rodriques recalled.
Technically, the company was in default, as the sales were too low to meet the bank's requirements for debt-service ratios. He was borrowing on future customer payments, a very expensive, desperation move.
"I was in jeopardy of losing my home," Rodriques said. (It's common for small business owners to guarantee loans with their own property.)
One day, he was reading a book on employee-driven companies, and read about the first company that tried Open-Book Management. A young manager named Jack Stack, who with other managers borrowed heavily to buy a troubled manufacturing division, gave employees an ownership stake, and told his employees the details of the company's productivity and sales trends so they would actually feel like they were owners, not just employees who hold a stake through a stock ownership plan.
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