Beyond the Looking Glass: Overcoming the Seductive Culture of Corporate Narcissism by Alan Downs

Author:Alan Downs [Downs, Alan]
Language: eng
Format: epub
Tags: Development, Business Development, test, Business & Economics
ISBN: 9780814403433
Google: yQNUnwEACAAJ
Publisher: AMACOM
Published: 1997-05-14T23:00:00+00:00

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maximizing practices abounded, such as extending unusually long credit terms to customers in exchange for big orders and shipping inventory to customers but not requiring payment until the customer sold the inventory. When the end of the fiscal quarter approached, account managers would often panic and start offering money off, or extra thirty to sixty days payment terms. While these moves boosted sales volume, they dramatically hurt margins. Customers quickly discovered the end-of-quarter scramble and started withholding orders until the good deals were offered.

The lumping of orders into the frantic days at the end of the quarter made B&L's distribution system bog down to a standstill. Its Ray-Ban distribution center in San Antonio, Texas, was forced to stay open twenty-four hours a day for the last few days of every quarter. To meet the demand, up to thirty-five temporary workers were hired and full-time staff hauled in huge overtime checks. "We'd ship 70 percent of the quarter's goods in the last three days," says a former operations manager.

Gill's hard-driving efforts paid off. Between 1980 and 1991 sales increased from $441 million to $1.5 billion and the stock had risen a remarkable fivefold.

With the success, Gill indulged in the extravagances of the rich and famous. B&L bought a three-plane fleet and built an elegant private terminal at the Rochester, New York, airport. He began using the company planes for personal trips to his home in Florida and a private fishing club in Canada. By 1991, Gill's total compensation had reached $6.5 million, an eighteenfold gain from his first year as CEO. To top it all off, Gill commissioned a brand new $70 million headquarters to house his office.

By the early 1990s, B&L's financial picture began to darken. Growth was slowing in the United States and Europe. Several big acquisitions were losing money. Ray-Bans had fallen out of style. And the worst of all, Johnson & Johnson had caught B&L completely off-guard with introduction of disposable contact lenses, further eroding B&L's share of that market.

The pressure to make aggressive sales targets didn't let

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