Failure of Genius

 

"They thought at first that there was something wrong with them," he says. "The carcasses looked so odd -- they're nude -- they looked like an albino or something."

The plant included a high-end on-site tannery. Most meatpackers, after they pull the skin off the cattle, ship the hides to third-party tanners, but Future Beef produced blue-chromed hides classy enough to be fashioned into seat covers for BMWs. The pet treats area cranked out items like Texas Toothpicks (cow tails, that is) and multiflavored cow ears. The cooking room, in the words of one visitor, "smelled really good."

They originally called the company FDR, for Finally Done Right. Later they switched to the more demure name Future Beef.

The real pride of Future Beef was its cleanliness. At the heart of this was a ventilation system designed by award-winning engineer Chuck Pharr. The system kept microbes from flowing from "dirty" hide-and-horns areas of the plant to "clean" meat-only areas. Because the carcasses had to clear a series of food-safety hurdles, including a mild acid wash, a steam bath, and a high-pressure rinse, the plant was touted as being literally microbe-free.

The plant was essentially all it was cracked up to be. Future Beef, however, was not. The company was limping toward its August opening date.

It didn't help that the company got into a series of protracted and expensive squabbles with suppliers. Among those was Micro Beef Technologies, developer of electronic cattle management systems. At each of Future Beef's five feedyards, cattle were herded into a monitoring station where a feedyard operator applied conductive oil to each animal's hide. Then, using a hand-held transducer not unlike the instrument doctors use on human patients, the operator could measure, within seconds, the density of the animal's muscle and fatty tissues. These numbers helped Future Beef and the feedyard determine the optimal date at which the animal would be shipped off to slaughter. Micro Beef's owner, Bill Pratt, claims two of the feedyards were using his systems long before they partnered up with Future Beef, and that Future Beef copied his systems for its other three feedyards without paying him or asking his permission. Future Beef didn't settle with Micro Beef until after Future Beef declared bankruptcy.

Future Beef also warred with Supachill, the maker of the plant's flash-freezing system. Future Beef intended to flash freeze parts like kidneys and tongues, but it never managed to get the equipment working correctly, and again, the tiff with Supachill resulted in a long legal battle. Supachill's Brian Wood says the company was arrogant enough to try to operate his multimillion-dollar equipment without asking his advice.

Future Beef's real albatross, says Darrell Wilkes, was an expensive computer system that ran enormously complex software from J.D. Edwards. "We were pouring all this data in, but we could never get the data out," says Wilkes, whose job, as the company's cattle and supply expert, was to monitor the progress of about 300,000 head of cattle. And these weren't just any cattle. These were Future Beef cattle, raised by ranchers who met its standards for feeding and monitoring their herds. Wilkes had to keep track of which steers had been given certain region-specific mineral supplements, which had been fed their necessary doses of vitamin E, which had been measured for yields of particular tissues and fats, and what the optimum dates were for shipping each steer off to the slaughterhouse.

Future Beef hadn't hedged its cattle. It couldn't withstand losses of up to $240 a head.

When Wilkes asked his staff for the numbers, they didn't have a clue. They had not been able to retrieve the data from the computer system.

"I swore a lot, and jumped up and down a lot, but it didn't do a lot of good," he says. "We would have been better off going in there with a very simple system. At least the simple systems give you your damn yield report."

Outside auditors later came to Rob Streight to ask why the company didn't choose a simpler system. "Well," he said, "I built this system planning for 2.5 million cattle and five plants with 10,000 employees." This same reasoning led Future Beef's founders to hire a thundering herd of corporate executives, whose offices were miles from the Arkansas City plant, in Parker, Colo. If the next four processing plants were to be built in more traditional cow towns like Denver or Fort Worth, a centrally located corporate office made sense.

When the first cattle finally arrived in Arkansas City on August 8, 2001, the management team at Future Beef breathed a huge sigh of relief. Wilkes and his crew had managed to struggle through. (At one point, he told his beleaguered staff, "We're going to do this on our own, with Excel spreadsheets and a Big Chief tablet.") Within a few hours, hundreds of carcasses were zipping around the factory production chain, and they continued to move through for several weeks while installation crews milled around inside the plant. According to Future Beef insiders, Safeway for weeks sent reports back that customers in its Phoenix stores loved the new products, and as early as the first days of September, though the cattle market was a little bit soft, Safeway was encouraging Future Beef's top brass to think seriously about the second, third, and fourth plants. The timing seemed perfect on the food-safety side of things -- E. coli scares in the United States and breakouts of mad cow disease in Britain in the late '90s had Americans nervous about buying beef.

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