Two friends. Two companies. Two totally different management styles. One life became a story of shared success, the other ended in tragedy
THERE IS A STILL A TRACE OF bitterness in Steve Kellogg's voice when he speaks of his last conversations with Charlie Moore. The calls came thick and fast in the weeks stretching from May through early June of last year, before they ended in an awful silence. Though the agenda often changed abruptly, mostly according to Moore's mood, all the conversations shared an element of soul baring -- and a sense of urgency. At first Moore had begged him to assume some of the work load overburdening his small consulting firm. Later, it was "Steve, I can't do this anymore. You've got to buy my company."
Despite the distraction of his impending wedding, Kellogg found the idea appealing. He respected Moore as a businessman, valued him as an old colleague and friend, and saw an opportunity for his own company, YWC Inc., to make a sound acquisition. Still, it grew difficult for him to hide his mounting annoyance with Moore. Aggravating enough that his friend and confidant kept rejecting advice to share equity in C.E. Moore Inc. with a few key employees; to Kellogg, this seemed the most straight-forward solution to one of Moore's biggest problems, namely the lack of motivation -- and sense of alienation -- he reported emanating from his own employees. More troublesome, Moore had never sent Kellogg the firm's financials. Kellogg found this unfathomable. Friendship was one thing, after all, but who in his right mind agrees to buy a company whose balance sheets lie buried in the chief executive's desk drawer?
That question never found a satisfactory answer. On June 19, 1986, Steve Kellogg's annoyance with Charlie Moore dissolved in anguish. David Moore, Charlie's nephew, phoned him that morning saying he had some "real bad news."
"Charlie has taken his own life," Kellogg heard David say, his voice edgy with shock. "You're one of the few close friends he had. Would you still consider buying the company?"
Taken his own life?
As the words washed over Kellogg, his first reaction was to focus on the ludicrous: How can I be one of Charlie's closest friends when I hardly know the bleeping guy? His second was denial. "What is this, David?" he barked into the receiver, not wanting to believe what he had just heard. "Some sort of sick joke?" Then he hung up.
It was, alas, no joke. Seven days earlier, after telling his secretary he was off on a sales call, Moore had left his Exton, Pa., office and driven about 20 miles west along the Pennsylvania Turnpike. Parking his car by the roadside, he walked up into the woods, gun in hand. A passerby found the body five days later. To the despair of those who knew him at all, personally or professionally, Charlie Moore had cashed out with a gunshot wound to the head.
For the rest of the morning, Kellogg closeted himself in his office. In a company that thrived on easy access to the boss, orders quietly circulated to give his door a wide berth. He sat there alone as the hours passed, pounding on his desk in frustration. He put his head down and sobbed into the blotter. He cursed Moore to the heavens -- you bastard, how could you not let me know how bad this had become? -- and ripped himself apart for not having responded to Moore's calls by seeing him in person.
Then, as the initial wave of guilt and anger passed, Kellogg rose from his desk, stared out the window, and asked himself: OK, Steve, how different are you -- really -- from Charlie? You've been pretty frustrated yourself before. Could you snap, too? Is running your own company worth the price that Charlie just paid?
By the time he returned David's phone call, Kellogg had reached a decision. He would buy his friend's company, whatever the price. Following through on that promise was, he believed, the best -- perhaps the only -- way to see that C. E. Moore's good name did not perish with its founder.
Yet it wasn't only Moore's reputation on the line for Steve Kellogg. Owning that company, he knew, would be an ever-present reminder to him. A reminder that issues such as growth, market share, and profitability are only elements in a vastly complex equation.
He hadn't known Moore very well, certainly not well enough to know the dimensions of his fatal depression. But he knew enough to believe intuitively, insofar as any friend could plumb another's psyche, that Charlie Moore's frustration with managing his own company had cost him his life.
Stephen Kellogg bought YWC, which specializes in wastewater treatment and other environmental services, from its corporate parent, York Research Corp., in 1981. At the time, York Wastewater Consultants had been providing most of the ballast for a $5-million environmental-consulting firm struggling to stay afloat. Kellogg had worked his way up to become the division's top manager and chief engineer, and like Don Johnson and Bob Bradley, two of the York Research colleagues who joined him in the newly independent venture, he regarded employee equity and team morale as crucial factors in motivating a young growth company. These had not been easy commodities to come by in a firm top-heavy with vice-presidents. Kellogg knew his own path up York's management ladder was littered with obstacles. He also saw the company struggling to cope with fundamental changes in the environmental-engineering business.
"The air-pollution-control business was really falling off," he says, "while technologies like wastewater treatment and hazardous-waste services were really taking off. It got to the point where [our division] was carrying an overhead load way out of whack with what we were contributing in profits. One day the president called me into his office for what I thought would be a talk about my finally getting a piece of the company -- maybe 5% to 10%. To my surprise, he proposed a leveraged buyout instead."
