Jerry Gorde gave his employees an ESOP, a majority on the board, and lots of corporate culture. What he never gave up was control
FOR CRYING OUT LOUD, JAY Nathanson thought. What's he up to now?
Nathanson abruptly turned off the tape player and nosed his burgundy-red Ford into the parking lot. Stunned, he tried not to stare at the senior managers waving placards outside the Vatex Corp. plant. It's a picket line, for chrissakes. Jerry Gorde and his buddies have set up a picket line.
Nathanson parked, then stayed in the car for a moment to figure his next move. He'd be damned if he'd join that line -- assuming that's what Gorde wanted. No. He'd just walk right past it and go to work. Grimfaced, he got out of the car, put his head down, and strode on into the building.
Once inside, he shuffled a few papers. But he was too distraught to work. He wandered back out, saw a friend sitting in her car watching the picketing, go in. Together they commiserated. Suppose a customer drove up! And what about production? Nathanson was one of Vatex's top sales-people, and was only too aware that the Richmond, Va., company was entering its busy season. By today the workers weren't going into the plant; they were staying outside, yukking it up with Gorde.
This is total insanity, he thought ruefully. Who would ever believe it? A CEO picketing his own company.
There's one guy who'll never understand, though Jerry Gorde as Nathanson walked past. Well, who needed him? By now, the picket line he had established was having its desired effect. Employees came up, puzzled, then stopped and talked. Most of the managers did too. Some picked up signs: "Vatex used to be a fun place to work -- why sin't it now?" or "I'm mad as hell and won't take it anymore." Guerrilla theater, Gorde reflected -- just like his days in the early 1970s, when he organized street demonstrations with Yippie leaders Abbie Hoffman and Jerry Rubin. Do something dramatic. Shake people up.
It was, without a doubt, time for action. Ever since the blowup a month earlier, Gorde had been watching the bickering, the feuds, the jockeying for position. It had sickened him, even made him think about leaving the company he had built -- and he really didn't know whether he could ever again trust the top managers who had rebelled against him. But if he didn't do something soon, the company would die.
And now his tactic, the "strike," was working. Amazingly, all the managers seemed to be on his side. Everyone, that is, but Jerome Golfman and his buddy Nathanson. Well, if there were a few who refused to lay down their swords, to get back to business, they would just have to be forced out.
Maybe today was the day. Ben Kutner, Gorde's chief lieutenant, was calling a meeting, and Gorde knew he would be expected to speak. If any of the employees wanted to know who was behind the trouble. . . .
Smiling and chatting, Jerry Gorde walked into the plant.
Plant. Well, you could call it that. Certainly the fancy new building housed the company's five multicolor automated screen printing presses, state-of-the-art machines that turned out gross after gross of the colorfully emblazoned T-shirts that were Vatex's chief product. And certainly there was warehouse space, shipping platforms, offices, a conference room. But plant? That made the company sound like United Widgets Inc., some straight-up, capitalist business run by greedheads and inhabited by automatons. Look again at the building. See those Grecian columns painted on the facade, sassily mimicking one of staid Richmond's best-known edifices? See that portrait of Jerry Gorde at the top of one of the columns? Walk inside, in the production area where the rock music is blasting, in the corridors where half a dozen dogs are lolling about, in the art gallery that occupies most of the building's central core. Check out the art itself, surreal painings at once lewd and revolting, with titles like Greasy Priest Hair Stink and It's Just a Sweat. Not your usual corporate art; not your usual plant; not your usual business.
Time was, you could get high on the contradictions. Vatex Corp.: on the one hand, hippie heaven; on the other, a phenomenally successful business, four straight years on the INC. 500. Jerry Gorde, in one guise a ponytailed ex-Yippie; in another, chairman and CEO of one of Richmond's best-known small companies. What a difference a decade made. In 1972 Gorde was organizing demonstrations at the political conventions in Miami; in 1984, chosen Virginia's Small-Business Person of the Year, he was invited to a ceremony at Ronald Reagan's White House. "It took the White House security system three months to clear me," he says, delighted with the irony.
To Gorde, such trappings of success were both personal triumph and philosophical validation. He hadn't expected to wind up in the business world; in his early twenties he had been a kind of itinerant activist, supporting himself through leather craft and odd jobs. But when he bought a cousin's T-shirt store in 1977, he figured maybe he could make his own little revolution, succeeding at the capitalists' game but refusing to play by their rules.
Somehow he had pulled it off. From a single retail outlet with the earthy name of Dirt Shirt, the company began to grow. Custom screen printing and monogramming. Advertising specialties. Blank T-shirt wholesaling. Clothing outlets in college towns. In 1980, sales of the company, then known as Virginia Textiles Inc., passed $1 million. In 1984 they topped $11 million, and the number of employees hit 70.
As the company outgrew its early family-style informality, Gorde experimented with forms of democracy and participation, trying to make Vatex a community as much as a business. An internal board of senior staff ran the company. Managers took on extra jobs such as disbursing 5% of the profits to charity every year. "We're asking every employee to become an owner and a partner," Gorde told INC. ("Will Success Spoil Jerry Gorde?" February 1984) -- and he put his stock where his mouth was, issuing new shares for an employee stock ownership plan (ESOP) and awarding equity bonuses to key employees. Before long he owned only 25% of Vatex.
Nonetheless, there was never any doubt about whose company it was. Gorde had always relied on his forceful -- some said domineering -- personality to get what he wanted, and he habitually involved himself in every detail of management, even if it meant riding roughshod over his colleagues. And though the board was ultrademocratic in form -- every decision required consensus -- Gorde guided its democracy with an autocratic hand. "I'd be hard pressed to think of an issue I didn't end up winning on," he admits. "I'm too damn strong . . . to go up against." If he didn't have consensus in advance, or if he couldn't "neutralize" his opponents, he simply wouldn't call a meeting.
For years, the exhilaration of growth papered over the strains of this schizophrenic style; both Gorde and his minions had to believe they were doing something right. Late in 1985, though, Gorde began to feel both uneasy and restless. Sales that year, he knew, would be down from their 1984 high. Worse, the company's systems were in disarray. Take inventory control. Most companies planned their purchasing, matching it to demand. Vatex bought all the raw goods it could, then hoped like hell that what came in would match its orders.
Even Jerry Gorde, Gorde decided, could no longer keep on top of the company Vatex had become. But what to do? He couldn't escape the feeling that his managers, his friends, true to the Peter Principle, had reached their levels of incompetence. He wasn't ready to replace them. But Gorde somehow wanted to train them, expand their horizons, prepare them for the next stage of growth. Not knowing exactly what he was looking for, he read books and talked to experts. Finally, in early 1986, he engaged a consultant named Ellis D. Hillmar, an associate professor at the University of Richmond, nearby.
On April 1, 1986, Vatex embarked with Hillmar on what is universally referred to in the company as "the process." Little did Jerry Gorde know that this particular process would come close to destroying his company.
Hillmar got together, at first, with a group of six senior managers, Gorde and five others he had selected. Among them were Ben Kutner and Jerome Golfman.
Kutner was central to Gorde's plans. When he joined Vatex, in 1982, Kutner had felt like a visitor from Pluto: he was a computer jock, a numbers man, and he came to work in a suit while his colleagues showed up in dungarees. But he had earned their respect, and in 1985 Gorde had named him company president. Now Gorde wanted him to learn to work with people -- not Kutner's strong suit, everybody knew -- in hopes he could become a real leader as well as a titular one.
Gorde wasn't so sure about Golfman. The pair went back a long way, to summers spent as youths in Old Orchard Beach, Maine. Golfman had joined Vatex in 1978, eventually rising to the position of vice-president of sales. But for years he had refused to participate in Gorde's management group, even working in a different building. When he finally did move to the main offices, fireworks ensued: during one particularly bitter argument, Golfman suddenly reached across the table and grabbed Gorde by the collar. Now both men were in this group that was planning, as the jargon had it, to "get real" with each other.
Hillmar called his program "Positive Management Practices," but much of what he did with the group seemed lifted from a sensitivity-training manual of a decade ago. Meeting once a week, they meditated, they shared their hopes and fears, they carried out trust-building exercises. They also tried to articulate what kind of an organization they wanted Vatex to be. In July, the six went on a four-day retreat to Virginia Beach, Va. There, as Gorde put it later, they found the "highest of highs": they cried, they hugged, they talked through the warm summer evenings late into the night. When they returned, they wrote up a "philosophy" for Vatex. "We seek an alignment of values between the individual and organization," it said in part, "that results in mutual satisfaction and shared purpose."
That fall, the process spread throughout the company. Hillmar and Gorde led Saturday seminars, open to all, on communications skills, or on the meaning of concepts like power and authority. They challenged employees from all departments to think about the future of the company. In late summer, they had created Group Two, six more managers who would go through the same experiences as the first six, and now Gorde expanded his board of directors to include everyone in both groups. Soon there would be Group Three and Group Four, the process eventually extending through the whole company -- and somehow from it all would emerge that shared purpose they were seeking. The "metanoic" organization, Hillmar began calling it, an organization, like the 1980 U.S. Olympic Hockey Team, that somehow performs well beyond its abilities because all its members learn to work in perfect harmony.
Metanoia. Gorde realized it was exactly what he had been looking for, an overarching philosophical concept that made sense of what he had been trying to do all along at Vatex. Corporate democracy, to him, had never meant elections or votes; that's why he had always let it be known who he wanted on the board, and why he expected it to operate by consensus rather than majority rule. Democracy meant people sacrificing their individual rights to the group, doing what was best for all. And now, thanks to Hillmar, they were learning to put it into practice.
Looking back on that period, people in Vatex mention a few misgivings, most focused on Gorde and Golfman. Gorde still dominated discussions, still couldn't delegate authority. Golfman never really trusted people, never quite opened up. But these are the wisdoms of hindsight; at the time, enthusiasm was running high. There was only one thing that grated, and the only person it bothered was Gorde.
Back in the summer, the newly expanded board had voted to spend $15,000 on exercise equipment -- weights, a rowing machine, an exercise bike, and the like. It was the beginning of what Gorde called Vatex's "wellness program": the company would bring in a doctor to give everyone physicals, then employees would map out exercise regimens with Sam Tarbona, a sales manager and fitness buff who agreed to serve as wellness director. To Gorde, fitness was an essential part of the personal and organizational transformation he believed they were undergoing. He himself hadn't exercised seriously in years. "But when I started," he says, "I went through a metamorphosis in relation to my body. It was like finding God."
For everyone else, the wellness program began more mundanely, with high hopes and good intentions. As fall turned to winter, however, fewer and fewer people were working out. This was not what Gorde had in mind. He was in the exercise room every day; where was everyone else? He urged people; he exhorted them; still they didn't come. For a while it was just a burr under his saddle, an irritating little frustration. But as the months went by the failure of the wellness program took on symbolic importance.
What Gorde wanted most to change, at Vatex, was the American creed of every man for himself. Here, people had to be committed to the organization, not the individual; they had to align their values with the company's; they had to want what the group wanted, not what was in their own short-term interest. That was what metanoia meant. And if they wouldn't buy into all that voluntarily, he would do what leaders since Moses had done when their followers failed them. He would "kick ass."
"As chairman," read the letter Jerry Gorde sent out through the electronic-mail system on January 5, 1987, "I am using my discretion to establish minimum physical fitness requirements. These mandatory levels must be maintained by all board members. Failure to do so will result in the loss of any and all benefits beyond basic compensation that you are now enjoying." Translated, the dictum meant that everyone on the board had to establish a fitness program, to be approved by wellness director Tarbona. Those who didn't do it wouldn't be fired. But they would lose their seats on the board (and the $25-a-week additional salary that accompanied board membership); they'd have to give up their company cars; and they couldn't take part in any company committees (another $25) or process groups (still another $25). For the 12 board members of Vatex, it would mean being expelled from the inner circle.
Jay Nathanson hadn't been with Vatex since the beginning. Still, he was among Gorde's oldest friends: he had grown up in Old Orchard Beach, and had met both Gorde and Golfman there while still in his early twenties. Nathanson had joined Vatex in 1979, at Gorde's invitation, and had stayed for a year before rejoining his family's business in Maine. But in 1983, struggling with a failing entrepreneurial venture and hearing about Vatex's explosive growth, he returned. By 1986, he was firmly re-ensconced in Vatex, a successful salesman working under Golfman.
Like Golfman, Nathanson clashed frequently with the strong-willed Gorde. Nathanson worked on a logo-development program; Gorde vetoed his concept. Nathanson began teaching some employees the word-processing system; Gorde inexplicably chewed him out for it. Worst of all, Nathanson wasn't included in Group One, the six top managers who began the process and took the beach trip together. By fall, though, he allowed himself to hope things were changing. He was included in Group Two, and Gorde had put all of Group Two on the board. At last he was near the company's center of power, and was getting the authority he thought he deserved.
And then -- and then came Gorde's damn memo. When he read it, something in Nathanson snapped. That very day, coincidentally, The Wall Street Journal ran an opinion piece titled "The Heartless Lovers of Humankind"; it attacked all the intellectuals throughout history who had supposedly stood for a better society, yet treated people like dirt. That, Nathanson thought, fit Gorde to T. Wellness was a symbol to the boss? Well, it was a symbol to Nathanson as well, a symbol of everything that was wrong with Vatex's culture. Ask me to exercise, he told Gorde. Encourage to exercise. I'll do it. Just don't tell me to exercise.
For two months the issue festered. Gorde told Nathanson to comply with the policy; Nathanson refused. Gorde ordered; again Nathanson refused. Finally, the members of Group Two, Nathanson's group, "implored" him to exercise. "For them I did it," he says now, still angry. "Once a week, now and then." He was supposed to write down on paper what he did, a process he found demeaning. "It was disgusting. It's something I couldn't even tell my family about." Gorde, though annoyed, refused to fire Nathanson, having believed from the beginning that he never had the right to dismiss the people he considered his partners. Provoke them, push them, make life uncomfortable for them, yes; fire them, no.
On March 3, 1987, around 6:00 p.m., people began taking seats for the company's monthly board meeting. Like all Vatex board meetings, it was open to anyone who wanted to attend, and that evening there were roughly 15 workers gathered with the 12 board members. No one knew quite what to expect. But Gorde had decided, as Nathanson put it, "to make wellness the issue of the night."
To Gorde, the issue was simple, and he expressed himself bluntly. There was individualism, and there was commitment to the group. The board, which had to lead by example, should demonstrate its commitment to group values, in this case by exercising. Some board members were in noncompliance with the policy; could we see their hands? Several people, raising their hands, confessed they hadn't been working out enough. Nathanson said he hadn't really been working out much at all. But, he added, he worked 12 hours a day at his job, and to him that was commitment enough. The trouble wasn't with him; it was with the policy. It was dumb.
What followed wasn't exactly a shouting match; but it wasn't a calm, reasoned discussion either. Gorde charged that Nathanson was shirking his responsibility as a director. Challenging a stupid policy, Nathanson retorted, was part of his responsibility as a director. Gorde pointed out that everyone had voted for the equipment. Yes, another director said, but no one ever talked about having to use it. At one point, Gorde said sarcastically that maybe they should just sell the equipment. That was when Jerome Golfman, Nathanson's friend and immediate superior, chimed in. "That's a good idea," he said. "I move we sell the equipment."
There was dead silence. Gorde had virtually been living on the equipment -- everyone knew that -- and Golfman was moving to sell it? "You're going to need a second on that motion," said Gorde, coolly. Nathanson seconded it. Right then, he says, Gorde became "incensed."
The discussion ended inconclusively. Next day, though, vitriol was again in the air. Gorde habitually cranked out electronic-mail memos to board members whenever anything significant happened; they were expected to respond, and he would distribute the responses. Today his memo to the board had more than its usual edge: "Where were you," he wrote, "when I was personally trashed [last night] for daring to raise the issue of commitment and accountability?" To Nathanson he was blunter. "If you want to fight, I am quite willing to take you on straight up. . . . If you want me, come get me. Just don't use this organization as a backdrop for your own little drama."
Nathanson's reply was relatively mild, asking only that Gorde "not ram this stuff down my throat." But it was the wrong thing to say. "Listen jerk," Gorde fired back, "you are not on the board to satisfy your own self-interest(s). If that is not understood you have no business being a servant of the organization . . . if ramming this stuff down your throat is the only way you will accept the separation of personal rights and organizational responsibility then I will shove it down your throat until it comes out your ass."
Shaken, Nathanson took a copy of his message to Ben Kutner, Vatex's president. But Kutner had troubles of his own. Gorde had angrily confronted him for not responding to the morning's memo. Furious himself, Kutner told Gorde he hadn't responded because Gorde wouldn't like what he had to say.
That night, Kutner decided to invite Gorde to a special meeting the following evening to talk things over. It wouldn't be an official board meeting -- that would require a public announcement -- but it would include everyone in Group One and Group Two, which happened to be everyone on the board. Next morning he proposed his plan to the groups, got their OK, then went to see Gorde.
By his own description, Jerry Gorde is "judgmental as hell, opinionated as hell, idiosyncratic as hell." That morning he was mad as hell. The responses to his memos of the previous day, along with the scuttlebutt in the hallways, had convinced him that the board was out for blood. "The opinion of the group was, get Gorde the hell out of here, I don't care what he's done for the last 10 years, eliminate the son of a bitch," he said later. And now he was supposed to meet with these people? Ha. "It was going to be a fish fry, a feeding frenzy, and I was supposed to be dinner. I said, 'Ben, I don't feel like being dinner to a bunch of goddamn sharks." Furthermore, he said darkly, if you people meet without me, you'll have to live with the consequences.
Kutner winced. He had agreed to invite Gorde; now he could cave in to his boss, or he could stand his ground. "We're going to meet anyway," he told Gorde. That evening, he and the others talked for a couple of hours, angrily but inconclusively. After the meeting, Kutner discovered a surprise on his desk: Gorde's resignation.
"Resignation," perhaps, stretches the meaning of the word. Gorde would resign as chairman and board member -- but he would stay on as "partner in charge of strategic planning." He named his salary and perks; he said he would report to no one save the board itself or its executive committee; he made a cryptic proposal that the board could "end my employment to Vatex" by paying him $50,000 in a lump sum. Kutner and Nathanson were tempted, that night, to see the letter as simply an overreaction to a trying situation. But Gorde called Kutner later that night to say he was quite serious. The following week, seething, he played his trump card.
Vatex's $3 million in bank loans, he pointed out to the assembled groups, was contingent upon his staying on as chairman and CEO. If they didn't agree to his terms -- right now, never mind calling any lawyers -- he would telephone Vatex's loan officer, announce he was leaving, and let the bank decide what to do with the company. If that meant the bank called the loans and sent Vatex down the tubes, well, so be it.
The group was stunned. "At that moment," says Nathanson, "everything changed." The issue was no longer one manager keeping to an exercise program, or Gorde's accountability. It was whether Vatex would survive -- and who would be running it if it did.
A company without a leader is like a ship with no captain: it can get by, for a while, as long as all hands are pulling in the same direction. At Vatex the unity on the board of directors -- Let's move ahead, with or without Jerry Gorde -- lasted only as long as the initial shock of his resignation. Then, as Ben Kutner put it, "the manipulations started."
Golfman and Nathanson, by now Gorde's principal antagonists, were ready to take over. Like all but one of the board, they had voted to sign what Nathanson called Gorde's "golden parachute," but their hope was that Gorde would absent himself from the business. "I thought he'd go away," says Nathanson. "So we started assigning tasks to various people. [We] were meeting quite often to discuss how we would run the company."
Jerry Gorde was "shocked by the betrayal"; he felt "taken out at the knees." Now he seemed unable to make up his mind what he wanted to do. One day he wanted to walk away, "to go clean bedpans in Kenya, do something real with my life." Another day he'd come in, just to chat with other workers. "I walked around enough to let them know Gorde hadn't left," he says now. "Basically I was waiting for the dust to settle." To Nathanson, his motives were more devious. "Gorde started telling employees, just regular employees, that the board of directors was lying to them," he charges.
Kutner, the company president, felt himself trapped. Vatex, he felt sure, would do better with Gorde than without him -- but who knew if Gorde could be enticed back? As second in command, he was theoretically head of the company so long as Gorde stayed out. But he had trouble asserting control. The sales staff was loyal to Golfman, and Kutner was no match for Golfman's political skills. Worse, Kutner held a note to the company for $75,000 worth of stock. All this talk about "tubing the company," as Gorde put it, was making him nervous -- so nervous, some salespeople thought, that he would never stand up to Gorde.
For two weeks Vatex drifted. Orders were coming in only because the company's busy season was starting; and product was going out only because the workers and supervisors were capable of running things themselves. But selling was at a standstill, and management was in stalemate. Gorde refused to meet with the board unless they called an official, public meeting. Fearing word would get out that Gorde had resigned as chairman -- and afraid to test the bank's willingness not to call the loans -- they declined. They wouldn't even tell the employees what was going on. "We said Jerry wanted to decrease his involvement, that the board and I would take over responsibility for operations," Kutner says. "We told them everything was hunky-dory and lied to them."
Kutner, growing desperate, decided to try a new tack: on Friday, March 20, he convinced the members of Group One to meet alone, with Gorde. Golfman had reluctantly agreed. But that night, when Gorde began asking each member of the group what he of she would need for him to come back, the question somehow stuck in Golfman's craw. "I'd need to figure out how to get you out of here again," he replied. Gorde walked out.
A few days later, Golfman was contrite. He had talked with Gorde, and had decided there was nothing to lose by trying to work things out. On March 24, all the members of Group One met at the University of Richmond, with consultant Hillmar. Golfman apologized to the group, saying he would "fold his cards" back into the organization, and that he and Gorde would seek a reconciliation. The discussion moved on to organizational matters, and the group agreed on a few changes they would implement immediately.
In the week that followed, though, the fragile reconciliation began to come apart. Group One returned to Vatex only to meet blistering hostility from Nathanson and the rest of Group Two: who did they think they were, only one-half of the board, making operational decisions? And what was their spiritual leader Golfman doing, suddenly buddy-buddy with Gorde? Had he sold them down the river?
Maybe, from Golfman's perspective, things were coming to an end anyway, and the apparent reconciliation had only staved off the inevitable. Or maybe Gorde then decided to play hardball, to attack Golfman now that he had lost his troops. Whatever, it was by all accounts a brutal scene that was played out on March 31, at the next meeting of Group One. Feeling confident, Gorde chose that moment to "get real" with everyone, expressing his feelings about them as individuals in no uncertain terms. When he got to Golfman he said that Golfman had always made him, Gorde, into a father figure. It was time to let go, Gorde said. Golfman's real father was dead, he pointed out. Golfman should let him rest in peace, should stop trying to make Gorde into a substitute father. This barrage, as it turned out, was too much for Golfman. Livid, he said to Gorde, "I don't have to sit here and listen to you ranting about my dead father." Then he walked out.
Later that night, a home, Gorde was thinking things over. He knew by then he wanted to come back into the company, rescue it, stop the drift -- and he may have sensed that the opposition was weakened. But he needed some kind of dramatic action, some way of asserting his leadership. Wait a minute, he thought, this is Jerry Gorde they're dealing with. Gorde isn't a CEO, he's an organizer, a revolutionary, an ex-Yippie. When you want to dramatize your grievances, you organize a demonstration.
The following morning, Gorde picketed his own company.
When Jerry Gorde watched Jay Nathanson cross the picket line, head down -- and when he noticed Jerome Golfman hadn't come in at all -- he knew he could force the issue. But when he stood up to speak at the meeting Kutner called, he began in a low key. He had grown up in a family business, he said, a regular company in which whoever owned it -- in this case his father -- ran things. At Vatex he had wanted to build something different. That was why he had shared ownership. That was why he had begun the whole process with Ellis Hillmar, seminars, groups, and so on. And the process was working; it was just that some people weren't following it.
You mean, like Jerome Golfman? someone asked. Well, yes, Gorde replied, like Golfman. Where was Golfman today? Not here. What does that tell you? Golfman had been trying to manipulate Group One and Group Two, but he had failed.
"The more he answered the question," Ben Kutner observed later, "the more he was blaming it on Golfman."
For a while, Jay Nathanson sat there and listened. When he could stand no more, he asked to speak. What you have just heard, he told the group, is completely untrue. How could the whole thing be blamed on Golfman? Groups One and Two had voted to accept Gorde's resignation, had set themselves up in opposition. When he finished his speech, though, Nathanson noticed a peculiar thing: he was all alone. Kutner was quiet. So was the rest of the sales staff. And Golfman, of course, wasn't even there. Just as a battle can turn the tide of war, that meeting marked the end of any uncertainty about who would control Vatex. All that was left was the mopping up.
It didn't take long. On April 8, a week after the strike, Kutner approached Nathanson. "I was the leader of one faction," Kutner says, "and by then he was the leader of the other. I said, let's create a period of truce, or there'll be nothing left to fight over." Nathanson, isolated, had little choice but to agree. Together they approached Gorde, who was about to leave for Florida to visit his parents. Gorde said, fine, give it you best shot. When he returned, about a week later, Vatex was back at work. Even Nathanson, filling in for Golfman, seemed to be doing well: sales numbers were up, the atmosphere was perceptibly more relaxed.
There were just two loose ends, really. One was Golfman: he either had to come back or be let go. It would strengthen the company's hand, Gorde knew, if he had someone ready to step into Golfman's job. The logical candidate was Nathanson. Granted, it was his intransigence that had touched off the whole confrontation. But he had already been doing Golfman's work -- and, besides, if Nathanson took it, it would be the final wedge between Gorde's two major antagonists. As Gorde hoped, Nathanson accepted. Shortly thereafter, Golfman was fired.
And oh, yes, there was one more thing. Down in Florida, Jerry Gorde had been doing some thinking. He had tried to build what he thought was a model company, a participatory organization where everyone had a say, where everyone shared in the benefits of ownership. He had voluntarily reduced his stock holdings to 25%; he had never paid himself more than a modest salary. And what had been his reward? An attempted coup. The bastards tried to throw him out of his own company.
Oh, sure, he could understand on an intellectual level what had happened. He knew he dominated discussions and almost always got his way; he could understand that people might have to take him on before they would be able to become leaders. But no intellectualization could change the emotional bottom line. Before, he had felt "trust, friendship, love" for his colleagues at Vatex. Now those feelings were gone. What was left was a business. And from now on that's what Vatex would be: a business.
Meeting with Nathanson and Kutner, he informed them of his conclusions. Professor Hillmar's process and its groups were out the window. The 12-person board would be abolished. Employee committees would be centralized under Gorde's office. If anyone disagreed, it was tough. Henceforth Vatex would be run by one share, one vote -- and Gorde and his allies controlled a majority of shares.
In May, Gorde held a special shareholders' meeting, at which he asked for a motion on the only item that required shareholders' action: removing all 12 directors from the board, then installing a much smaller board loyal to Gorde. Ben Kutner made the motion; someone seconded it.
No one needed to count the ballots.
Jay Nathanson was nominated to the board of directors that night. He declined. Earlier in the day he had told Gorde he would do so, and had been informed, in yet another sardonic electronic-mail memo, that his decision was "a definite sign as to the level of thought, dedication, and maturity you are bringing to your role in Vatex." But it didn't matter. Vice-president of sales or not, Nathanson was, as he knew, "history."
The week of May 18, the moment arrived. Nathanson had put in motion a small reorganization plan for the sales department, and had promoted a young woman named Debbie Rowe to a sales-training position. Hearing of the plan, Gorde called Nathanson into his office and told him that Rowe should continue with some of her old customer-service responsibilities during a six-week training period. They argued, Nathanson pointing out that he had already promised her a quick move into sales. Gorde stood fast. Two days later, Debbie Rowe quit.
On May 26, 1987, the day after Memorial Day, Jay Nathanson got to the office early. He dropped off his keys to the Vatex building and to the burgundy-red Ford, which was owned by the company. He hugged a friend, got into a waiting taxicab, and left for his home in Maine.
He didn't say good-bye to Jerry Gorde.