II8. Rationality Creeps In
Once Cohen and Greenfield decided to package their ice-cream and sell it "on the road" in 1979, their business entered a point of no return. During these early years of the business they worked sixteen hour days, putting all of their efforts into the actual production and distribution of their ice cream. And they were also becoming aware that their status was changing: "Ben & Jerry were turned off by the realization that they were becoming businessmen, a vocation toward which they had developed a healthy skepticism while growing up in the sixties. What contribution were they making for the world by taking in money with one hand and paying it out with the other? They had become a cog in the economic machine whose values they had questioned all their lives. The business had grown well beyond the small, community oriented ice cream shop they had set out to open. They were now running a company whose pints were available in four states and that was selling franchises to other would-be entrepreneurs hoping to duplicate their success" (Lager, 1994: 54). The huge commitment they were making to the business had taken its toll as well, "especially on Jerry, who was now 60 pounds overweight" (Lager, 1994: 54). In 1982, after deciding to sell the business and then declining all of the offers they received, they realized that they were too close to their work to let its unique style be altered (i.e., rationalized) by the multi-billion dollar candy company that was intent on purchasing Ben & Jerrys. However, the process of rationalization had already begun, by virtue of the fact that they were compelled to deal more and more with the "real business world", or the corporate culture that necessitates rationalization trends. While they made attempts to deny such trends in every way they could, the growth of Ben & Jerrys demanded that they conform to the rationalization process. The growth factor for the business had until this point in their career been unstoppable. Their second production area "which Cohen and Greenfield had worried about being too large when they arrived in 1981, was already too small by 1983" (Lager, 1994: 68). And, despite the realization that their growth was out of their control and against the best efforts of Cohen and Greenfield to halt or even slow it, growth of the company remained at a rampant pace until only very recently, bringing a conformity to the culture that they despised along for the ride.
One minor example of this can be seen in their changing attitude toward corporate fashion. Upon making a deal with a new distributor in 1982, Cohen refused to conform to the fashion culture of the corporate world: "The first distributor [Ben] approached was Hendries, a $30-million plus ice cream manufacturer that was based in Milton, Massachusetts Ben, with his bushy beard, and wearing an old shirt and a pair of jeans with holes in the knees, looked as though hed just come in from milking fifty head of Holstein. When [Ben went in] to see Graham West, the director of marketing of Hendries, Wests eyes just about popped out" (Lager, 1994: 84). But just a few years later, as they approached a more formidable economic authority while making their first stock deal, things had changed. The "executives" of Ben & Jerrys (including Chico Lager) were to make a presentation to the Vermont Industrial Development Board (VIDA) regarding the first stock offering. "The fifteen or so members of the VIDA board, all properly dressed in business suits, were seated at a series of tables that had been arranged in a large horseshoe. Ben was in jeans, but wed gotten him to wear a clean shirt, and he was looking reasonably presentable" (Lager, 1994: 95; my emphasis). Presentable to whom? To the corporate authority figures who expected them to conform to their culture, as they were the ones who controlled the opporunity to give the thumbs up or thumbs down for their stock offering. It was a necessary step toward rationality, albeit a slight one, but it was representative of more obvious problems to come, as their business began to grow even larger.
In 1985, their third new plant opened in Waterbury, Vermont. The move to the new plant was a significant step in the rationalization process.
In Waterbury we were suddenly separated. The production and warehouse crews were in one part of the plant, the office workers in another. Instead of sitting at desks that butted up against each other, we had doors and cubicles that walled out distractions, but also kept our co-workers at a distance.
At the same time, we started getting departmentalized. Huge chunks of the business were being carved out of Bens and my job descriptions and passed on to managers who had recently been hired. There was now a director of retail operations to oversee our franchise program, a controller to supervise the accounting and finance functions, and a director of manufacturing. The up side was that more work was getting done. The down side was that as people became more task-oriented, they began to lose their connection to the whole of the organization (Lager, 1994: 143).
This statement most obviously describes a process of rationalization. Note the emphasis on separation and quantification.
The "whole" that they were losing touch with can be identified as the same element that was missing from the new plant: an internal communication that came with the physical closeness of the previously non-rationalized system by which they used to organize their business. So, instead of a one-on-one communication that flowed freely through a non-departmentalized plant, the workers were on their way to becoming "cogs in the machine", and their work transferred from a "labor of love" to a process of efficiency.
This process of efficiency is clearly indicated in the "cost-cutting mentality that kept everyone focused on the impact our individual and collective actions had upon the bottom line" (Lager, 1994: 146). Several informal programs were started to reinforce this mentality, including the "Fred" award, by which an employee would nominate him or herself to be recognized for some previously unforeseen frugality, and the "Just Say No" memo, "in which I implored department heads to cut discretionary spending. Every dollar not spent, it was pointed out, fell right to the bottom line" (Lager, 1994: 146).
The rationalization process that began at the Waterbury plant continued to produce problems for the organization. These problems were even given a metaphorical name, "freezer doors". The metaphor arose from the inability of the doors that opened on the deep freezer to work automatically. Consequently, they were left open indefinitely, with only a thin plastic curtain separating a vast difference of temperatures. This naturally caused frost to build up in the freezer, which had a deleterious effect on the quality of the product stored therein. "Freezer door" thus "became a metaphor within the company for anything that was not working and was being ignored despite a painfully obvious need for attention. It referred not just to physical things, but to managers, systems, and procedures that our rapid rate of growth had laid waste to" (Lager, 1994: 160-161). The continuing rationalization exacerbated this trend, especially when the automation of certain systems became necessary.
At the end of the summer of 1987 there were freezer doors everywhere. A lot of our problems stemmed from a decision earlier that year to automate the pint lines Installing a new piece of equipment was always more disruptive than anticipated Our down time went through the roof and our inventory went through the floor In an effort to catch up, we started running marathons. On a typical production day, there were two eight-hour shifts making ice cream, after which a cleanup crew got the plant back in shape for the next day. When we ran marathons, wed make ice-cream continuously for forty-one hours. Some weeks wed run double marathons, which added the equivalent of a full day of production For many, the shortfall in production was a reminder of other times in the past when the company had faced adversity and stepped up to beat it down. There was a difference, though, between this crisis and [others]. This one was self-inflicted (Lager, 1994: 161).
The growth of "freezer doors" in the Waterbury plant was an analog of the process of rationalization that occurred there. And, as Lager notes, they were not competing with outside economic forces; they were competing with themselves. The rationale of growth had become the underlying guiding principle by which the company now operated.
Cohen, as well as others who worked for the company, were not oblivious to the adoption of this rationale. In fact, it was the central issue in a running debate between Cohen and Lager.
The issue that was at the root of most of my conflicts with Ben was the great unresolved debate over growth. Ben was concerned that if the company got too big, it risked becoming just another bureaucratic corporation, no different from any other. To prevent that from happening, Ben would announce from time to time a limit on just how big we were going to be. What were looking to do is reach the capacity of our equipment and stay there, Ben told the Burlington Free Press in March of 1980, right after the pints had been introduced. We will not make another quantum leap. It was only the first of many times that Ben tried to limit sales by tying them to how much ice cream we could produce. When we were at $2 million in sales, the limit was $8 million, the capacity of the plant on Green Mountain Drive. When we decided to build the new plant in Waterbury, the limit got pushed up to $15 million. Six weeks after we moved in, we decided to add onto the factory, and upped the ante again.
The limits skewered our long-range planning by putting up a mythic horizon, beyond which we never looked. Even when confronted with what seemed to me irrefutable evidence that we needed to further expand the plant to meet demand, Ben was reluctant to do so.
Despite alot of talk on the subject, we rarely made decisions that were consistent with the idea of limiting our growth In fact, whenever our sales approached whatever limit wed set, we simply pushed it back another $10 million or so, then worked like hell to hit the new number (Lager, 1994: 152-154).
The element of growth is described here as a force that acted upon their business beyond their control or management. They had to adjust to whatever limit their ice cream sales approached. And consequently, the workers who produced Ben & Jerrys ice cream were coerced into altogether undesirable work schedule. The management did try to alleviate the undesirability of the twelve-hour "marathons" they ran, going so far as to hire a masseuse for over-tired employees. But, nonetheless, the growth they incurred as a result of increasing rationalization (and the increasing necessity for rational processes that was incurred by growth) forced Ben & Jerrys into a vicious circle from which they could not escape.
The non-rational values that were upheld by the original business had been replaced at this point in the growth of the company by an ethic that substantiated efficiency, predictability, calculability and control as primary values. A transformation thus took place reforming the previous non-rationality with a bureaucratic temperament. It was the growth of the company that forced this reform and enclosed Ben & Jerrys within the iron cage. And any plans to limit the growth of the company have been thoroughly washed away. According to Mitch Curren (the "P.R. Info Queen"), who was, incidentally, the only employee of the company that I was allowed to interview formally, growth has now become an inevitable drive linked to the companys existence: "Not growing is not an option anymore," she says, as though it had been in days previous. Although the sales growth of the company has begun to drop off, reaching only 6 percent by mid-1995, down from the double-digits of previous years, and conceivably Ben & Jerrys could in fact be reaching the horizon set up by Cohen in the past, the continued rationalization of the company demands that growth also continues to be a primary value.
Robert Holland, Jr., the latest Chief Executive Officer of the company (hired in the spring of 1995, only a few months previous to this writing) recently stated in a press release that the company will double its revenue from the current $150 million level by expanding distribution overseas and once gain increasing the number of retail outlets (note how the phraseology has changed - they used to be called "scoop shops"). In fact, Hollands experience in the world market was the main reason that he was hired, according to Curren (after nearly 27,000 people responded to a typically non-rational contest begun by Ben & Jerrys in the summer of 1994 called "Yo! I Want To Be Your CEO!", in which a one-hundred word essay was to be sent explaining why the respondent thought they would suit the job). A second part of Hollands plan for the company is to restructure its management. "The management has not been sophisticated in the past and Holland will, with great ease, be able to institute policies that will cause Ben & Jerrys to operate in a much more sophisticated fashion," says Lewis Alton, who heads the San Francisco investment firm L.P. Alton & Co. (Buffalo News, June 26, 1995). Curren states that in the past few years attention to the social mission had been the priority for the company. But, given the dwindling sales of the past year or so, Holland was hired not so much to "clean house", but to "get the house in order". His main priority will be to concentrate on the economic mission. "Holland insists that the company will not lose some of its qualities that make it unique, especially its commitment to charity and social projects", says the press release. This will remain to be seen. But it is clear that it certainly will not lose its commitment to growth.
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