Herman Miller’s Leap of Faith

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I found this an interesting example of “Corporate Renewal”, from Fast Company by Linda Tischler

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Of all the despairing images published when the New Economy went belly up, the one that most pierced the hearts of the hardworking folks at Herman Miller was a photo in the Houston Chronicle on December 3, 2001. It showed two newly pink-slipped Enron workers hauling the detritus of their offices to their cars. Their mode of conveyance? A pair of Aeron chairs.

During the dotcom heyday, any executive worth his stock options had one of the iconic, biomorphic, ergonomically engineered chairs. The Museum of Modern Art acquired one for its permanent collection. The Industrial Designers Society of America named it one of the “Designs of the Decade” for the 1990s. Malcolm Gladwell lionized them in Blink. Designed by Bill Stumpf and Don Chadwick in 1994, the Aeron chair was one of the Michigan-based furniture maker’s most popular products. Internet companies ordered them by the truckload. In late 2000, the company was taking orders for 20,000 to 30,000 per week.

A year later, the chairs were going for a fraction of their $700 price on eBay and in liquidation sales. But that was hardly Herman Miller’s only problem. The office-furniture industry and corporate America’s economic well-being are as closely entwined as Thelma and Louise. And with telecom tanking, financial services tightening, and tech companies hitting the skids, Herman Miller joined them in going off a cliff. “We had a two- or three-year period where business dropped 45%; that was like an industry heart attack,” says Michael Volkema, chairman of Herman Miller’s board, who was the company’s CEO at the time. “In 1995, when I took over, sales were under $1 billion. By 2000, they were $2.2 billion. By 2003, they were down to $1.3 billion. One night I went to bed a genius and woke up the town idiot. It was not a happy time to be in leadership.”

In the face of what was shaping up to be a long-term siege–and losses of $56 million–Volkema and his team did what many in their shoes do: They took their lumps, with painful layoffs and cutbacks. But at the same time, they did something much more unusual for a rapidly shrinking company: They positioned it for a brighter future with tens of millions in R&D investment–much of it mighty speculative. Choosing to invest in what were essentially blue-sky ideas just when the company was downsizing the workforce and closing plants wasn’t an easy sell. Try telling a factory worker that his job is being eliminated so you can fund something that may–or may not–pay off five years down the road. “Barely one out of 1,000 companies would do what they did,” says Harvard Business School professor Clayton Christensen, author of The Innovator’s Dilemma. “It was a daring bet in terms of increasing spending for the sake of tomorrow while you’re cutting back to survive today.”

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86ing in the weeds

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From Management Craft by Lisa Haneberg

Recurring Dream

I was spending a few hours in the Chicago O’Hare Airport in between flights and got a bite to eat at Wolfgang Puck’s restaurant there. Watching the servers buzz around reminded me of a recurring dream.

In the dream, I am a waitress and I am in the weeds, big time. In the weeds is a term servers use to mean WAY BEHIND. In the dream, I have several tables of people waiting for food and drinks and I can’t seem to get their stuff to them. The computer doesn’t work, the supplies run out, and I forget things. I am in service quick sand.

I have this dream when I feel really behind. My dream is set in a restaurant because I was a server for TGI Friday’s for a few year while going to college. I had almost forgotten about the dream, but I had it again a couple weeks ago.

This is a wake up call. My mind is trying to tell me something. It’s shouting, ‘listen up!’

The last few weeks have been very busy and this next week is as well. All great projects, but perhaps too many things going on at once. After this week, I will be back to a better project load for me. I had a pretty good project plan, but things got a bit backed up due to the two weeks I was out of commission due to my mother’s death (and then a couple more weeks being in a fog from the shock). That’s just the way things go sometimes.

If your mind were going to scream a message to you, what would the message be?

The good thing about being a server in the weeds is that every shift comes to an end and you get to start over. It’s not quite the same when you run your own business. That said, we can take a couple days to get organized and renegotiate deadlines if needed. We can start fresh.

Do you have any recurring dreams (or daydreams)? Listen up!”