I woke up in total darkness. I rolled out of bed, still half asleep, took two steps and turned left, the way I had for years, and walked into a wall. Which woke me up sufficiently to make me realize I was not in my old house in San Jose, but in one of the Elemenco company condos on the Near North of Chicago.

The company had bought three or four of these condos, because somebody had said they'd be good investments that would save us money on lodging. The really plush ones were reserved for our customers' executives and our own very top brass. The one they had given me until I could find my own place had a tiny kitchen, bathroom, living room, and small bedroom. It was furnished like a glorified motel room. But, in one way, it was already like home: It was a total mess.

I found the clock under yesterday's shirt and saw that it was four in the morning, about two hours before the alarm was set to go off. So I got back in bed, but couldn't get back to sleep. My mind had engaged. Memories of the day before were playing in my head.

I saw Lynne sitting on the sofa in Gene's office and saying, "Tell me, what went wrong on the Northern Airline negotiation?" And, "If your products and technology really are superior, and nobody I've talked to doubts that they aren't at least highly competitive, why isn't this being demonstrated in sales?"

I heard Greg and Bud arguing about the price issue, about whether to pursue new technology or push the industry standards. Interesting, wasn't it? Two veteran pros of the same company with nearly opposite points of view about what was best.

Since I was already at work in my mind, I decided around five o'clock that I might as well be there physically. So I got up and took a shower and headed downtown.

I arrived at the office just after sunrise. There is always something spooky about being in a normally busy place when it's empty. I could hear my own footsteps on the carpet.

My office was on the eastern side of the building and I could see Lake Michigan beyond the other downtown buildings. The storm had passed and the early sun cast cold pinks on the snow. I switched on my computer and went to make some coffee. A few minutes later, the coffee brewing, I was calling up a spreadsheet I'd been working on for the past few days in an attempt to understand the company.

Since Monday, just after I signed the W-4 forms, I'd been poking around in the various company data bases and pulling out numbers. By now, I had pretty well satisfied myself that the problem did not lie with anything except marketing. I had ruled out any likely technology gap, lack of manufacturing capacity, quality problems, and so on. The constraint to growth was marketing's ability to sell.

Because Elemenco was in the computer and data communications business, we had some fairly good internal systems. I could bring up not only numbers, but text from key documents going back three or four years—the minutes from important meetings, executive speeches, product reports, strategy papers, market research, and so on. That Friday morning, I started seeking causes of the current malaise. One thing about Gene Cherson, he was thorough. He documented everything. I had a lot to work with.

Around nine o'clock the interruptions began to increase. My secretary, Sylvia, had received a copy of the announcement naming me as Gene's replacement, and wanted to know if I'd be changing offices.

"Hell no," I said, "I haven't had enough time to clutter up this one."

"But you're entitled to a bigger office."

"Forget it," I said.

As Morrison had requested, I called Gene's wife and offered assistance. She said he was already talking about coming back to work. Terrific. I asked Sylvia to arrange for flowers.

Then a few of the staff people started dropping by to brief me on projects they had going. Which ordinarily would have been fine, except that I felt I was close to something on this analysis and I wanted to finish it. So I scheduled a staff meeting for midafternoon.

Meanwhile, in the material I was pulling from the marketing data base, I had begun to see a pattern emerge in our decision making. Years ago, a basic policy had been set up: if a customer wanted a product and if Elemenco could make it at a competitive cost, Elemenco would market that product. It was the "department store" approach, something for anybody who would buy from us. And Elemenco could do it, because it had significant resources at its command; it didn't necessarily have to focus its capital on a small group of products the way a smaller company might.

I turned away from the computer for a moment and started thumbing through a product catalog for Elemenco. On the cover, the artist had put pictures—stunning photographs—of a satellite dish, one of the newer 386 personal computers, a boxlike piece of network hardware, a woman talking on a cellular car phone, and a cable split open to reveal the rainbow of colorful wires inside.

Inside the catalog were descriptions of every product and special codes the sales force could use to get current pricing, inventory levels, and so on. What a job it must have been to put that catalog together. At my last company, we didn't have even a quarter of the products. And the products in the Elemenco catalog were only part of the story; many of them were constituents of larger systems. The systems weren't even in the catalog, but had their own brochures. And then there were the services Elemenco offered—software, maintenance, engineering projects.

Who was it who bought all these products and systems and services from us? I found some research on that. The customers were almost as diverse as what we sold. Everybody from self-employed professionals—lawyers and doctors, for instance—to some of the largest corporations in the world. One of the largest segments was customers involved in some aspect of transportation—railroads, airlines and air express companies, trucking companies, automobile manufacturers. But there were also insurance agencies, banks, chemical companies, you name it. Something for everybody.

There was a very interesting section in the research on customer suggestions and other feedback on what Elemenco could do to improve itself. Most of it was so contradictory it was practically useless. Like 42 percent of our customers wanted more technical service, another 38 percent didn't, and 20 percent thought what we offered was fine. So which way were we supposed to go? While 72 percent wanted us to offer more features, 28 percent thought our products were too complicated. Great, huh? We want your stuff to do everything including walk the dog, but keep it simple.

Gene Cherson had been head of Elemenco's marketing for five years. As I looked back through minutes of meetings he had run and memos he had authored, I saw that much of what Gene had done through the years was what I would term "standardizing" the company's marketing. Confronted with this many-headed beast called the Elemenco product line, he had year by year been constructing a framework in which to contain it.

Little by little, I pieced together a chronology of what had happened. It had begun shortly after he came in as marketing VP, with standardizing all the graphics—the logos, where the logo should appear on the product, what color combinations were acceptable for Elemenco products, package design. Pretty soon, all the product brochures were standardized and the ads began to take on the same look. This had been a big deal and had taken a while to accomplish. Then certain pricing and servicing policies were standardized. Sales costs were adjusted to make them uniform for the whole company and all products. Internal procedures were changed so they all conformed with one another. Staff jobs were refocused to become, well, less focused, broadened to cover functions rather than groups of products or customers. The crowning achievement was the Lean Mean Marketing Machine, with its consolidation of sales forces, standardized compensation, new emphasis on efficiency and systemization, and all the rest.

On one hand, I sympathized with Gene and what he had tried to do. The growth-by-marketing-everything-we-can-make strategy had made things quite complex. Plus there had been acquisitions, and each of the little companies Elemenco bought had its own way of doing things. Clearly, he'd had to do something, or it would have been a total hodgepodge. And yet, what had he accomplished by attempting to create uniformity?

I went back to my spreadsheet and made it do a bar chart. Neat glowing columns grew from the bottom of the screen. The columns went up and up and up, like steps—$445 million, $572 million, $791 million. Then three years ago, things changed. The numbers leveled off at just over $1 billion, hovered there, and last year stepped down to $988 million. Just like the top of a roller coaster. I added in comparisons of net income. In absolute numbers it too went up and up, but as a percentage it became squeezed. The year before last it was down around 4 percent; not too good, folks.

It dawned on me that all those numbers and reports and so on might not be letting me see the true picture. What if, to support his own framework, Gene Cherson and his staff had altered the way reports were written and numbers collected?

The one undeniable fact through all of this was the drop in sales and net income. And the real shift away from growth seemed to accelerate when Cherson had started mucking around with the sales force.

A few minutes before noon, Ann Lansky called. I had forgotten all about her.

"You'd mentioned lunch yesterday," she said. "Are you still interested?"

"Yeah, let's do it."

"Should I come up?"

"No, stay put. I've never been to the twenty-second floor. It'll be a new experience for me," I said. "See you in your office in a few minutes."

I grabbed my coat and took the elevator to 22. Through a pair of doors marked "Elemenco Central Region Sales" was your average open office with fabric-covered partitions done in boring beige. I looked in some of the cubicles. There was a guy on the phone. Here were a couple of others getting coffee. A woman walked by with a file in her hand. It all looked very normal. And yet there was a certain energy here that you didn't feel in, say, accounting.

I didn't know where her office was, but I wandered around until I found it. She was waiting for me.

"Ready to go?" I asked.

"Sure. What are you hungry for?"

"Corned beef."

"I've got just the place," she said. "Wait a minute. I thought IJK was in California."

"It is."

"And you want corned beef? What are all your health-nut California friends going to think?"

"Let ‘em eat kiwi."

Outside, we started walking to a deli on North Michigan that Ann said was her favorite. Side by side with her, I suddenly couldn't think of anything to say. Just as the silence was becoming embarrassing, she spoke up.

"So how do you like Chicago?"

"I don't know the city very well," I said. "But I like Chicago. It's been fine.... Well, a little cold so far."

"Does your wife like it here?" she asked.

"My wife? I'm not married."

"Oh, I don't know why, but I just thought you were married."

"What about you?" I asked.

"Divorced."

"Was it recent?"

She laughed. "No. Sixteen years."

It seemed we were getting too personal, so I asked her another question I thought would take us to more neutral territory, not knowing it would do the opposite.

"How did you get into sales?" I asked.

"Actually, it was because of the breakup," she said. "I was twenty-three years old. I had two kids. I was on my own. I had dropped out of college to get married, so I didn't have a degree. We weren't going to make it on the little bit of child support we were getting, which he wasn't paying anyway. My dad had died of cancer, and I couldn't burden my mother. I didn't have much choice. My dad had owned a television repair business, and I had helped him in the shop while I was growing up. So I knew something about electronics. I talked my way into a job in sales here at Elemenco, which was a fast-growing company in those days, and they couldn't add salespeople fast enough. My mother stayed with my kids and I went to work."

"That must have been very tough on you," I said.

"At first. But in two years I was making $50,000. I found out I was good. And I liked it. The only thing that was bad was the traveling and the hours. It was hard on my kids. Which was why I finished my degree and moved into management when I got the chance. I actually make less money in management than I would selling, but more than enough to live well, and the hours are better."

The more I heard, the more I liked Ann. I suspected she had earned every one of those gray hairs showing in the brown. But the good life was showing on her. She was about ten pounds and a few years past voluptuous, yet one of those women who might have been considered beautiful enough to be an artist's model about a century ago. She was kind of Greek or Italian looking, smooth skin, nice hands.

"You never remarried?" I asked her.

"Almost. One time. I wanted a man in the house for the sake of the kids while they were growing up. But it was a good thing we broke it off, because . . . well, it probably would have been another disaster. No, between my kids and my job and getting my degree, there hasn't been a lot of time left."

"How many kids do you have?"

"Two. Both boys. The older one, Adam, has always been the perfect kid. He's a junior at Notre Dame studying business. The other one, Patrick . . . well, he's a good kid, too, but he's the one I worry about."

"Why?"

"He likes things that go fast, especially cars. I offered to put him through college, but he doesn't want to go. He wants to drive race cars. Right now, he and a friend are in Daytona working as waiters so they can go to the winter races down there."

Ann rolled her eyes as if she just couldn't understand it.

"He's always been competitive," she said. "Like his mom, I guess."

We reached the deli on North Michigan and were able to get the last available booth before the lunch line started forming. It was time to get down to business, and I started by asking her to tell me about her region—how many people, that kind of thing.

She told me that, aside from the clerical staff, she had nineteen salespeople in the office, about half of Central's total sales force. The rest were in smaller offices across the Midwest, from Minneapolis to St. Louis and from Omaha to Cleveland. Some were in two- and three-person offices, some worked out of their homes. But Chicago was the hub and most of the major customer accounts were handled from here.

"What do you think is going on out there?" I asked her. "You never got much of a chance yesterday to say what you thought the problem was, what you'd do differently."

She said, "I don't know what to tell you on that score, except that I'm doing the best I can right now and it doesn't seem to be making any difference. Anyway, you folks on the marketing staff are the ones who are supposed to have all the answers, aren't you?"

"Gene Cherson must have had you brainwashed," I said. "Actually, I don't know that I want answers right now. I'd just like your help finding out what the real story is."

She thought for a second and then said, "Don't ask me to write a research paper on this, because I don't know what the reasons are, but I get a sense that half the problem is we've taken all these salespeople and thrown them together in the same pot."

"The same pot?"

"Before Gene's Lean Whatever Machine, we had a separate sales force for each group of products. We had a computer systems sales force. We had a telecommunications sales force. And we had a specialty electronics sales force. The reorganization took everybody and made them into one big sales force. I'll be the first to admit that the old way had its problems, but Gene's Lean Mean, or Mean Lean, or Whatever Machine isn't the answer either."

"I'm inclined to agree with you," I said. "But what makes it look like it's not working? What are the symptoms you're seeing?"

"The people I've got don't work together very well," she said. "Time and again I see opportunities slip away. Even my top performers have been dropping the ball, leaving sales on the table, letting competitors in the door. We just can't seem to get the job done."

The sandwiches arrived, brought by a dumpy waitress who was probably my age and looked twenty years older. It was good corned beef, lean and tasty, but I was more interested in what Ann was saying than in the food.

"At first I thought that it was just a learning curve we had to put up with. I thought maybe they just didn't know all the products well enough. But we put everybody through seminars and product training. By now, they ought to know what they're selling, or at least know where they can get the right information. No, it's something else. And I don't know if anybody has figured this out yet, but this company has a turnover problem in sales. I get along pretty good with most of my people. Without me, some of the better salespeople would have left by now. And if you don't believe that, you can talk to them. Frankly, I don't know how long I can keep the top performers on board."

"I'm not pointing any fingers at you," I said. "But what's making them leave?"

"I hate to say it, but it seems like it's motivation. I'll tell you, only a few of the salespeople I've got are happy about the compensation program, and the ones who are happy are generally not the best performers. Now, it's true that our average sales rep makes $55,000. That's average. Yet some of them could make a lot more than that under the old plan, and it's really got them upset."

We ate quietly for a minute or so while I thought over what she had told me. An idea began forming in my head. Despite all that analysis I'd been doing for the past few days, I still didn't feel I had a good handle on how this company was really selling its products. The information on the computer, extensive as it was, couldn't tell me everything I needed to know. There were numbers and numbers and more numbers—any kind I wanted. There were millions of words of text. Yet I couldn't get a picture of what was happening when one of our salespeople came face to face with a customer. Even talking to Ann, it was still secondhand information.

"I'll tell you what I'd like to do, and I'd like your help making it happen," I said to Ann.

"What's that?"

"Starting Monday, I want to work alongside your sales force as much as possible for the next couple of weeks."

"All right. But why?"

"I want to see for myself what's really going on. I want to go out with them on calls, meet their customers, listen to them on the phone, have them show me exactly what they do. I want to know how we're selling, and why we're not selling."

"Well, okay, but I frankly don't know if that's the best use of your time," Ann said. "I mean, if there's anything you need to know, I can either tell you or find out for you."

"Thanks, but I think it's important to see it for myself."

"Fine," she said. "You're the boss."

"Good," I said. "I'll come down Monday morning and we'll get it going."

In the back of my mind, I didn't know if spending time with the sales force would teach me anything. It might be invaluable or it might be a total waste. I would have to see. But, right or wrong, I was going to delegate everything I could at the staff meeting that afternoon and make time for it.

To Chapter 6

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