(FORTUNE Magazine) – IF YOU DON'T LIKE the hand you're dealt, get yourself another hand. That's what the Imcera Group did. In just six years Imcera transformed itself from an ailing producer of fertilizer and commodity chemicals into a highflying manufacturer of health products. How? By buying up companies that had been neglected by their corporate parents, reinvigorating them through heavy spending on research and development, and selling off its own original business. To encourage a new spirit, the Northbrook, Illinois, company motivates employees -- all 9,500 of them -- with some of the most progressive incentive plans in corporate America. In 1986, Imcera, then known as International Minerals & Chemicals, bought Mallinckrodt, a manufacturer of medical products and specialty chemicals, from an inattentive Avon Products. The price, $675 million, was equivalent to nearly 60% of Imcera's revenues that year. To help pay the bill, the company raised $716 million by offering its fertilizer operations to the public and divesting other businesses. Says Chief Executive M. Blake Ingle: ''Mallinckrodt was the classic kind of acquisition that wasn't supposed to work because it was so far away from our core business.'' But it did work, and so have the many smaller acquisitions, licensing agreements, and joint ventures that followed. Says Ingle, 50, a soft-spoken microbiologist with a Ph.D. from Colorado State University: ''These acquired companies have such a backlog of innovation that we really don't have to do a lot except lift the lid and say, 'Let's do it.' '' Ingle runs a highly decentralized corporation with three distinct operating companies. The crown jewel is the medical-products half of Mallinckrodt, where hefty R&D spending (up an average of 50% in each of the past three years) has produced plenty of new products. One invention with great potential: a blood gas monitor used for critically ill patients. The other half of Mallinckrodt has become Imcera's specialty-chemicals company. It is the world's leading maker of acetaminophen (the active ingredient in Tylenol). The third part of Imcera is Pitman-Moore, the veterinary medicine company bought from Johnson & Johnson in 1987 and now the world's largest marketer of branded, animal health care products. Imcera motivates its managers by granting them lots of autonomy. Once the heads of the operating companies get a sign-off from Ingle and his associates on their annual strategic plans, they have little day-to-day contact with Imcera's 120-member corporate staff. That's not to say accountability is lax. Says Boyd Wainscott, the down-to-earth president of Pitman-Moore: ''We have very strong delegation of authority here, but you'd damned well better do what you say you're going to do.'' To get managers in the right frame of mind, Imcera puts as much as 50% of their pay at risk. About 75 of 550 senior managers are enrolled in long-term incentive plans. The company is also on its way to becoming one of a handful of U.S. corporations that grant annual stock options to nearly all employees around the world. Imcera ties most of its contributions to employees' tax- deferred savings plans to the company's return on invested capital. Says Beverley Hayes, vice president of human resources: ''These programs have created tremendous peer pressure. When other employees have their hands in your pocketbook, you'd be surprised how aggressive you get about their performance.'' You can bet on it.

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