Page 73 - Gary's Book - Final Copy 7.9.2017_Active

Corporate headquarters decided to retain all other managers of the offices, plants
and accounting departments.

OWS was doing $25M per year with losses of over $6M per year. It was apparent
that I had to do some fast cherry picking of the low hanging fruit as the best easy
target. My team consisted of eight regional managers and seventy sales people
scattered across the U.S.; they were working out of large offices, satellite offices

and their homes. Personnel turnover was over 21% annually - both voluntary and
involuntary. Continuity was a major concern, and training was an ongoing expense
costing $600,000 per year, which was primarily headhunters’ fees. The product
line was only competitive in performance. We were on a level playing field. We
had no winners, and all the patent protection for all the products we had had

expired. Anybody could compete against us. The market share was about 25%,
and most large businesses were sold via contract and were designed to use the
customer’s name as a testimonial to gain additional business.

The loss leader that first caught my attention were the hotels and properties owned
by Harry and Leona Helmsley in New York. I learned early on that there is

business you cannot afford to have under any circumstances. OWS treated the
chillers, swimming pools, water towers and drinking water at the Helmsley’s
hotels. All our contracts were losing. They were non-profitable for OWS, so I
canceled the contract. Leona Helmsley threatened to never conduct business with
us again and would let everyone in the business know how we had damaged her
company. She bad-mouthed us all the way. She was everything that has been

published about her, a nasty controller.

No one could provide any direction as to what skill sets were required in the sales
function to reduce the turnover. My first major issue to be addressed was the sales
staff; turnover was 20+%. I went to the HR manager for input since he was with
the former company for twelve years. I thought he would have some knowledge of
the reasons for the sales people’s departures. What was the weakest link? Sales

skills? Technology knowledge? Or both? I needed to know why we were losing so
much money. I told him to place on my desk a list of former company sales people
he would rate as winners and non-winners, no matter the reason for their departure.
The worst problem was that we were paying the highest salaries and bonuses in the
industry just to attract individuals. I drew a matrix that included their educational

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