Peter Browning &CONTINENTAL(Book: Managing Change; Cases and Concept, Todd D Jick & Maury A Peipert, second edition, McGraww Hill, pages 166 – 174)
Learning Objectives • Describing a problem in White Cap Company • Analyzing the problem to make a change • Implementing the change
White Cap Background • In 1926, William P. White and his 2 brothers started the White Cap Company. • White Cap is active in closure production and distribution, in new product development and in the design of cap making and capping machinery. • White Cap promoted itself as “Total system” of Engineering service to the food industry. • In 1956, The Continental Can Company bought White Cap.
In 1984, The Continental Group was merged into KMI Continental, a subsidiary of Peter Kiewit Sons, a private construction company • The White Cap become Continental White Cap, the most profitable of the parent firm’s nine divisions – each of which produced different types of containers and packaging • Despite the sale of White Cap 1956, The White family continued to manage the organization and its traditional company
White Cap Tradition Culture • WP White and Bob, his sons, inspired and encouraged a strong sense of family among their employees. • Once hired, employee tended to remain and to bring their friends and relatives as well. • In exchange for hard work and commitment, employees received good salaries, job security and the feeling that they were part of “winner”. • White Cap was rife with rituals, ceremonies and traditions. • In 1982, Bob White stepped down, and turned over to Art Lawson.
The Change Force • Many competitor who offered the twist- off cap, a technology which invented by White Cap. • In 1982, price competition began to heat up in the closure industry. • In 1982, FDA approved the use of particular Plastic containers which requiring plastic closures. • Many of company, change their container from glass to plastic in order to customer convenience of squeezable plastic bottle.
A Sense of Urgency • Senior White Cap had been reluctant to allow R &D to commercialize plastics developments because plastic threats in the past had never materialized. • Introduction of plastic packaging to many White Cap’s traditional customers threatened sales. • White Cap knows this threatened, but not yet fully realized, changes in the competitive environment.
The Change • White Cap salary and administrative costs at 13% of net sales, compared with 3-4% ratio in other divisions • Continental Group itself was going through it own period of “radical surgery” for cost cuts. • Continental Assigned Peter Browning as agent change in White Cap Company
Peter Brownings • Browning’s career began with White Cap and Continental Can in 1964 as sales representative in Detroit • In 1979 , he returned to Chicago to become vice president and general manager of Continental’s Bondware Division, a producer of waxed paper cups for hot and cold beverages and food.
During the Bondware fall, he adopted a drastic and accelerated change program, employing what he called “radical surgery” to reduce employee by half, to eliminate an entire product line, to close 4 to 6 manufacturing site. • And in 5 years, Bondware began to rise again
Browning is Reassigned • Early 1984, Browning received his reassignment orders from CEO to White Cap Divisions. • CEO believed that his success with Bondware and a veteran of White Cap was surely the person to make those change. • CEO instructed Browning to communicate a sense of impending crisis and urgency to the White Cap staff.
CEO had several major concern about White Cap : • They saw competitive on slaught brewing that they believed White Cap’s managers did not recognize • The Continental’s CEO concerned that White Cap’s long time success, coupled with the benevolent paternalism of the White family management, had led to padded administrative staff.
Taking Charge • In first months of Browning new position, his attention to 3 issues : • He felt ha had to take some stand with regard to Bob White. White was very much alive in the hearts and minds of White Cap employee. • A second challenge is Marketing Department. It’s only administered existing program. Not spending constructive time with the customers.
A Third, is a manager of Human Resources, Tom Green, a veteran White Capper with 25 years seniority. Browning found Green had a few constructive idea and seem to do a lot of delegating and to spend a lot of time reading Wall Street Journal. • Beside these 3 issue, Browning wanted to rejuvenate White Cap and yet not demoralize employee’s loyal work force and management.
Summary • White Cap is successful company in the past with tight tradition and culture which brought by the founder • Threaten is coming by using plastic as container which need plastic closer. • White never realized this threaten / changing • Browning is reassigned by CEO of Continental group as agent change in White Cap • Browning started changing with 3 issue.