"Anything we're going to do, we put up for a vote," says customer service rep Snider, as if it were the most logical thing in the world. "We don't just have someone say, 'Well, this is the way we're going to do it, and you guys follow us.' That's the way we work it. The whole plant works that way."
A skeptic might want to ask a couple of questions -- maybe starting with, Why bother? -- about all these breaches of managerial convention. Niceness and open doors may come cheap, but education benefits are expensive, and open-book management and internal democracy both require serious commitments of time and training. And then there's the issue of how far you're willing to trust your employees. Suppose someone betrays your confidence? Suppose the group makes stupid decisions?
Leaving aside the counterargument that CEOs and managers aren't immune to either of those vices, a fan of Atlas's we're-all-in-this-together culture -- and there are many in the Severn plant -- might respond by pointing to the hard realities of the cardboard box business. It's an industry in which the opportunities for screwing up are legion. (Atlas may ship as many as 200 separate orders a day, each one a different kind of box, from the same plant.) It's a price-competitive industry in which the difference between profit and loss is tiny. (Let paper waste creep up a few percentage points, and suddenly, your business is in the red.) Everybody has to pay attention to details in such an environment, and the company that saves a nickel earns a nickel. Quick, now: Who is more likely to be paying attention and worrying about those nickels, employees who trust management and feel like owners or employees who are only putting in time? "It isn't just about being nice," says Paul. The open books and democracy are ways to shape a company that can do things that its competitors can't. "When people feel they're part of an organization, they feel the passion. And if they feel the passion, you're going to be dangerous in the marketplace."
Though passion isn't something that can be measured, it has clear-cut benefits. Whatever the up-front costs, for example, the Atlas culture is dramatically cheaper in the long run, simply because it obviates the need for an army of frontline managers. "I'm the only supervisor on the East Coast running a box plant that has 35 people under him without assistance," says Charles Kilgore, one of Atlas's printing managers, who has spent 39 years in the industry. "At another plant, I might have a general foreman, training supervisor, die-cut supervisor, and two lead men. But we don't need supervisors in this place. We have people here that run the plant themselves." Another cost saver: the fact that employee retention averages around 85%, compared with an estimated 50% elsewhere in the industry. Atlas isn't spending a lot of money to replace and train people who don't stay because most do stay.
The culture also promotes employees buying in to tough decisions, instead of the kind of grousing that undermines morale and performance at a lot of companies. Health insurance costs are going up? Both company and employees are going to have to pay more? Okay, let's put it to a vote: Do we want to change the coverage, or keep it the same and dig deeper into our pockets? It's the employees' call, not management's. The decision to buy the new machinery for the corrugator wasn't so different. Installing and learning a complex piece of equipment is always costly and difficult. But once they voted on it, it was the employees' machine, and they had a lot invested in making it work. The installation took three days when it might easily have taken a week -- the smoothest in the company's history, says Paul. Sure, people continue to grouse at Atlas. They just don't do it much, because there's no "them" to grouse at.
If the devil is in the details, the details reveal a company in which people take ownership of problems because they can understand and see -- and know everybody else can understand and see -- exactly how the problem shows up in the financials. Take Ralph Layman, the corrugator superintendent. He watched the line for inks and starch, under cost of goods sold, creep up. Maybe he could change the formula for the starch used in corrugation, he figured, using fewer solids, and thus save money. The first try didn't work -- too much warped board. Eventually, he found the right mix: "More quality boards with less starch dollars," says Paul approvingly.
Shipping manager Russell Jones was coming under fire because the shipping cost line was high. The problem, he realized, was that he couldn't use full truckloads for shipping, because the right combination of orders wasn't coming off the production line. So he talked to the production crews and learned that the job scheduling needed to be changed. A group met with the scheduler to explain the problem and work out a solution. The result: lower shipping costs and less work-in-process inventory.
Customer service is just one more department in which employees go out of their way to reduce costs. Everyone there knows the department has to monitor one key number: credits issued to a customer because an order was entered wrong. "You have to watch your own orders when you're booking them and when you print them off," says Paul Snider, "and double-check your orders before you put them in." If customer service keeps credits below $2,000 a month, everyone gets a small gift certificate. "That's the 'game' in our department," says Snider.
"We'll jump on a problem with a lot less resentment and foot dragging than you would find in another company," says chief financial officer Thomas Downing, who spent most of his career working for other companies. The culture "creates an organization that's more responsive and more malleable," which is a nice way of saying that what we have, a lot of companies would kill for.
