Opening the Carton
A maker of parts for the box industry is listening more to its employees.
(FORTUNE Small Business) – When FSB's consultants performed a makeover on Georgia-based Corrugated Replacements last year, owners Bob and Stan Lee resisted the suggestion that their top-down management style alienated employees. Our experts told the Lee brothers that unless they boosted morale by giving employees a bigger role in decision-making, the manufacturer of spare parts for the corrugated-box industry didn't have much of a future.
That advice evidently sat poorly with Bob and Stan, who declined to speak directly to FSB for this update. But other company officials say that changes are afoot at Corrugated Replacements. "That kind of criticism can be hard to swallow," says marketing chief Karen Cornwell. "But we've taken several positive steps since the makeover." Among them is a newly launched cross-training program among CRI's various departments, designed to bolster unity throughout the organization. "Instead of sales reps being tied to the phone constantly, we get them out on the plant floor so they can get a real understanding of what goes into making parts," says sales manager Barbara Gagne. "And we invite production people to come and sit in on sales calls."
The Lee brothers have also started paying more attention to the concerns of their employees. They implemented monthly strategy meetings that are voluntary and open to all employees. They also put a suggestion box on the plant floor. At a recent all-company meeting, a shipping manager suggested that the company launder work gloves used on the shop floor instead of trashing them each day. The result: Corrugated Replacements expects to save between $400 and $500 each quarter.
Last year sales rose 17%, to about $10 million. (Corrugated Replacements recently revised its 2004 revenues upward, from $7 million to $8.6 million.) But serious challenges remain. Many U.S. packaging plants have followed their manufacturing clients overseas in recent years. Others have shut down in a wave of industry consolidation. And many of Corrugated's remaining customers are investing in new machines that break down less frequently, requiring fewer spare parts. The Lee brothers and their staff still have a lot to talk about.
For links to Z-Yachts, Corrugated Replacements, and others mentioned in these stories and to give feedback, please visit fsb.com.