So, It Wasn't So, Joe?

When Joe Galli decided to persuade the board of Newell-Rubbermaid to leave its corporate headquarters behind in Freeport I published the following column in The Journal Standardon February 20, 2003.

Say it Ain't So, Joe
by
Roland Tolliver


The sky is falling. The sky is falling. Chicken Little

It is not the Black Sox scandal. It is not the second coming. It is not the end of the world as we know it. It is one company announcing that they are moving their corporate headquarters. Illinois' government and the big business community rejoiced about two years ago when they found out that they had won the Boeing headquarters' sweepstakes. Millions in tax incentives were offered. There was wining and the dining by the corporate elite in Chicago. The key to the city and hobnobbing at Chicago's famous museums were a part of the process. We'll generate millions we were told. The tax incentives will pay for themselves in no time. We've heard that before. The headlines in Chicago acted as if there was no other news in the world. "Ho hum", said the rest of the population in Illinois. Boeing's aircraft are still manufactured by the hard-working citizens of Seattle and other cities with plants in the aeronautical industry. Meanwhile, about 150 executives relocated to Chicago and few words have been heard since then.

Now it is our turn. A few weeks ago we learned that Newell/Rubbermaid's corporate offices will move to Atlanta. How do we compete with Hartsfield Atlanta International Airport? How do we compete with the Peachtree city and the proximity to Wal Mart's corporate headquarters? Why would Joe Galli move out of Freeport for the southern climate and hubbub of Atlanta? Oh, wait, that's right, Joe Galli never lived in Freeport. He spoke to the Chamber of Commerce once, I believe, but I don't think that makes us his permanent residence. Joe, I hope he doesn't mind us being on a first name basis, once said that "But as important as company culture is, it's never set in stone. Culture takes its direction from the goals the company sets and the body of people working to achieve those goals." The corporate compass is currently pointing to a goal south of the Mason-Dixon line. In 1962 that corporate compass pointed northwest of Chicago to the county seat of a mostly rural county when when its companies consolidated into a single corporation in Freeport, Illinois. Sixty years earlier that corporate headquarters was founded in Ogdensburg, New York. Does anybody here know where that is?

When I was looking up the history of Newell/Rubbermaid one word repeatedly showed up in the descriptions. That word was "acquired". We are proud of "our " Newell's acquisitions as "our" Newell became a Fortune 500 company with offices and manufacturing plants throughout the world. We claimed pride in ownership of the "little company that could", which was located right here in the heart of Stephenson County. We cringed with any downsizing and rejoiced with any new emmployment opportunities. People in the area spent entire careers at Newell Window Furnishings. It was a job for life with dividends and stock options. Somehow we grew bigger than our borders through stategic buyouts and corporate mergers and then we became the Ogdensburg of the Midwest. The newspapers' headlines read in large, bold letters that Newell had forsaken us for Atlanta. The Chicago Tribune came hunting for a story and found that in Freeport it was business as usual. No immediate jobs were affected. The centralized corporate functions in Freeport were to be unaffected by the move of Galli's Army (Fortune December 31, 2002) to Atlanta. Our manufacturing base, distribution center and corporate employees were to be like the other 46,000 out of 48,000 employees who are working for Newell/Rubbermaid worldwide. Basically, for the time being, the earth will continue to spin on its axis and people will contiunue to go to work.

Ninety percent of all new jobs are created by the small business sector of America. Over fifty percent of those businesses are started by women. Some small companies become big companies. Most stay small, while many go out of business or start another company. I don't hear too much about them in the city council meetings. I don't hear much about tax breaks or tax increment financing districts. You know the people. There are the accountants, doctors, lawyers, and architects. There are also the plumbers, electricians, coffee shop owners and those that open boutiques or beauty salons. Do you know a massage therapist, owner of a car dealership or store owner? How many people are employed by these people? How often do you see these individuals in the grocery store or at the bank? When was the last time you saw the CEO of Allied Signal/ Honeywell walk into the local Culver's? When was the last time that the CEO of Goodyear spoke to your Kiwanis or Rotary club?

I know that there is a lot riding on future decisions made by the "big three" in Freeport. It will affect all of us in a worse-case scenario of "trickle-down economics." The tax base suffers leading to a loss of school funding and decreased monies for the city's infrastructure. The ancillary services like the hospital, community college, doctors, lawyers, accountants, home-builders, realtors (well, maybe not in the short run), hair salons, and various other businesses lose their client/patient/customer base. Why don't we hear more from our local governing entities about investing in the small business future of our community? Why are we so myopic in our desire to court large businesses in this fragile economy? Illinois was third in the nation in lost jobs last year, and yet, we offer one of the highest rates of tax incentives to big business. I don't see where the long term payoff is. I realize that families can sometimes be uprooted in the corporate world and community spirit can dwindle along with charitable donations and community services. To hear some tell it, we are already there.

There are some things in Atlanta with which we cannot compete. I don't think we'll see a Boeing 767 arriving at Albertus Airport any time soon. We are not near major interstate highways, but I do hope that we see a four-lane highway heading toward Iowa and Interstate-35 in my lifetime. Newell/Rubbermaid has given back millions to our community. The Ferguson Cancer Center and the Freeport Public Library are two prime examples. We are grateful for their contributions and nothing says that their donations are going to dry up any time soon. Honeywell and Kelly Springfield have also made major contributions, along with most of the businesses in our community. Without the individuals who make up the work force, however, none of this is possible. We all give to a community we believe in to the best of our abilities and resources. As for the "quality of life" that the news release said Atlanta offered the company, I believe that it is the quality of the people in a community that determines the "quality of life". In that respect, I'll enjoy the life I have here.

I don't want to sound too Pollyannaish, but I see that we have much potential in our little neck of the woods. There is an underlying spirit in this community. It is the spirit of the people that we see every day in the people that are our neighbors and friends. It is the spirit of those that see the glass as half-full, not half-empty. It is the spirit of those that call Freeport and northwest Illinois home and are proud of that fact. I see it in the thousands of volunteer hours by retirees, churches, service groups and individuals. I see it in the people that are employed and those that are employers and both of these groups' families. I see it in all of the people that donate their time, money and resources to make our community a better place to live. I see it in the people from all walks of life from the boardrooms to the stockrooms and all points in between. These are the people that I am honored to know in a community that my family and I are proud to call home.

It looks now like Mr. Galli is no more the "Whiz Kid" of corporate restructuring than any one of a number of executives who come in highly-touted and then ruin the image or integrity of a company. Freeport, apparently, wasn't good enough for Mr. Galli. He went for the glamour of Atlanta with its busy airport and CNN tower. He came in cutting and slashing jobs and divisions within the company and to what gain. A loss of confidence among the people and companies that had gained trust in the "Newell Way." There was a time when employee morale was high and there was great pride in the company and its products. It still exists, but where it does, it appears to be in spite of Mr. Galli, not because of him. When a family has run a company for years and a family atmosphere exists, it seems counterintuitive to bring in an outsider, who may know business, but doesn't know squat about the people, the history and the way a company does business.

Growth through intimidation ( the'you must work so many hours and produce so much in a day to be successful mentality' may play in New England, but the core of this company and its fortunes were firmly rooted in the Midwest with midwest ethics of family and work as separate, but more equal entities) was counterproductive. And now Mr. Galli of Black and Decker and amazon.com fame, is another statistic, albeit a rich one, in the corporate merry-go-round of those executives who sell themselves to the highest bidder. In the end the burden of the cost is directly on the communities that suffer from their short-sightedness and profit over people mentality.

Say it ain't so, Joe, but it wasn't just a dream and all will be as it was. It was more like a nightmare and our community suffered because of your ineptitude and inability to realize the real worth of the company, the people who worked there because they had a couple of traits that you seem to be in short supply of, integrity and loyalty.