Document 44BbXVrEj5NGdrxnymDgD8NNa

America's Paint Company A His t o r y o f Sh e r w in -Wil l ia ms Chapter i: The Right Mix, 1866-1884 n Chapter 1: Covering the Earth. 1885-1919 11 Chapter 3: Joining the Coatings Revolution, 1920-1939 39 Chapter 4: Marching to War. 1940-1945 Chapterj: The Postwar Boom. 1946-1965 Chapter 6: Spreading Thin, 1966-1978 55 65 75 Chapter 7: Renaissance in Coatings, 1979-1991 93 Acknowledgments and Notes 109 0007-SWP-034470 0007-SWP-000113152 0007-SWP-000113153 Ch a p t e r r he birth ot .i successful business is often the result of happenstance. .1 question of mixing the right ingredients at the right time, fn the esse of the Sherwin-Williams Co., the key ingredients--three entrepreneurs and * market opportunity-- came together in Cleveland in the summer of 1870. when Henry A. Sherwin. Edward P. Williams, and Aianson T. Osborn gathered to establish a company to manufacture and market paints and varnishes. The dominant figure in the new busi^fe'*** Sherwin. who served is president. Born in Baltimore. Vermont, in 184a, he leftpehool at age 13 to work in a general store. In tS6o, he moved to Cleveland at the invication of an uncle who had opened a law practice there. Sherwin was a sober and industrious young man who found employment in Cleveland as a clerk in Freeman Sc Kellogg Co., a drygoods store, where he was noted for his ability to wrap hoop skirts into neat packages. After rwo years at Freeman Kellogg, where he had risen to the responsible position of bookkeeper, he moved to a similar job with Geo. Sprague & Co., a wholesale grocery. He became a partner at Sprague, but left soon after this appointment, apparently because he disliked merchandising liquor. By 1866, che frugal lad had saved s1,000. (To place this number in perspective, per capita income in che United States that year was abouc stSoo; using chis figure as a point of comparison, Sherwins savings would be worth more than sso.ooo in today's currency.) Offered employment as a cashier in a bank, as a partner in a wholesale drug business, or as a partner in a wholesale painc business, he chose the last, buying a stake in Truman Dunham 4i Co., a prosperous firm that sold painters' pigments, linseed oil, colors, brushes, glass, and ocher products for turnishing and decorating. Aichough it was "che least remunerative" of these opportunities, Sherwin later recalled that Truman Dunham "was the one which in my youthful strength and ambition gave promise of a future greater than che others." On che other hand, he confessed chat he "quite unexpectedly dropped into the painc business. It seems to have been one of those opportunities that come to men early in life, and I am flee co say chat I did not realize what it would lead to." As a partner of Truman Dunham, Sherwin displayed an approach co business marked by discipline, hard work, and attention to detail. He began by establishing a thorough office system. Then, in order to learn all I could about the goods and at che same time systematize the care and arrangement of them, I frequently put on old clothes and worked like a porter. I opened packages and examined their contents, found out what they were tor and how used, compared costs, and evenings 0007-SWP-034473 0007-SWP Following the dissolution of the Truman Dunham partnership, Shcrusin, WUliami, atul Othom established a nowfirm to carry an tht holiness ofwholesalingpaint* and varnishes. By tht tarty 1870s, theyoung company wtu sufficiently prosperous to moot to new offices on Superior Street in CteoetasuL f*. V 0007-SWP--034474 0007-SWP-000113155 C.iivnrfn i Hie Rii.nr Viv >tudied all the books and catalogs t could find which in jnv way referred to these materials. While doing these thinsjs. I was training our employees in system, good order, jnd cleanliness everywhere about the establishment. I hate alwjvs believed a fine sense of order prevents miscakes. saves tirne. pleases patrons, and is real economy to any business. In i86y. the firm built a factory in Cleveland to make linseed oil, then the base ingredient in most paints. Finding that his partners "were giving that branch of'the business their particular attention, which left me without able assistance in the paint business." Sherwin proposed a "dissolution and division of the business." This evenr occurred in February' i8~o. Dunham and another partner remained in the linseed oil business, while Sherwin and two like-minded friends. Osborn and Williams, each invested J15.000 for equal shares in a new partnership. Osborn had been bookkeeper of Dunham Si Co. Wiliams, a Phi Beta Kappa graduate of Western Reserve College (forerunner of Case Western Reserve University) and a Civil War veteran, was a partner in a small glass company in Kent. Ohio. In April 1870. Sherwin recruired Sereno Peck Fenn. w-hom he had met on a train ro a YMGA convention, as cashier and bookkeeper. The business of Sherwin, Wiliams Sc Co., as the new firm called itself, was listed as "importing and jobbing. . Zincs. Oils. Colors. Varnishes, and Wndow Glass." It operated a retail store at tt8 Superior Street in Cleveland and began with a fast start: during the first year sales reached S4a1.59O.9T. Sherwin. Williams Sc Co. was well positioned to respond to the booming population and heady economic growth of post-Civil War America. In f8*0. the population ofCleveland was 91.819, more than twice its level a decade earlier, and it would double again by 1880. The city, which occupied a strategic crossroads between sources of raw' materials and agricultural goods in the West and the populous markets in the East, was on its way ro becoming che sixth largest in the nation. The catalysts for this grow th the w ere industries of iron and steel, metal working, railroad equipment, oil refining, and manufacturing, which attracted ever increasing numbers of immigrants looking for employment. From the perspective of Sherwin, Wiliams Sc Co., che industrial and commercial establishments chat fueled growth, and the residential areas that housed workers, shared a common need for paints and varnishes to protect and decorate buildings and structures. At the end of the Civil War, the coatings industry in Cleveland stood on the threshold not only ofexplosive growth, but also ofsignificant technological change. Up to then, paint was generally mixed on-sice by professional painters who combined a base of oil or varnish with pigments, thinners. and sometimes other ingredients. In 1867. in a Cleveland suburb, D R. Averill developed a liquid, p,re-mixed paint which. Sherwin felt, "made use of a formula which simply could not produce a reputable paint." AveriH's "patent paints," as these ready-mix coatings were called. 13 0007-SWP-034475 ! 0007-SWP-000113156 HtnryA Shtrwtn. 1873 EdmtrdP. Willitmt. 1870 Po r t r a it o f THE Fo u n d e r s On iu 115th anniversary, the Sherwin-Williams Company contin ue* to reflect many of the principles and value* of iu founder*. Among the first gcnaraaoa of laden. Henry Aldan Sherwin was the dominant figure in trie company, iu president from 1870 to 1909, and chairman of the board until hit dath in 1916. A stickler for cleanliness, he often appeared unannounced in the Cleveland factory to inspect every department. After each inspection, he wrote to die foremen, giving them a grade based on what ha found. At the end of che year, the foreman with the highest point total earned special recognition. These inspection* were not ' .! affairs. According to W.R. Siepleus, a manager who often accompanied Sherwin on his rounds, "he par ticularly 1tressed that corners and the space under stairwiye and behind machinery should be kep< thoroughly dean and free from rubbish." A favorite saving, recalled Sieplein, was "a place for evatything and everything in its place.' Sherwin loved to fish, an avocation he shared with his partner, Edward Porter Williams. More outgoing chan Sherwin, Williams was no less upright. According to a profile in the employee magazine, Tht Oucmtittiy, Williams's 'most prominent characteristic was thoroughness he had the power and ability to pup things in their detail and to cany them through unyieldingly to a successful completion. In the earlier days when the business was small and iu founders were laying plans for its growth and development, he was always found at the wheel guiding and shaping the policies of tht Company, working here and theta - in the office, in the factoty --doing most to further the inter ests of the litde business. Often times he was found in overall* wotiring side try tide with die men in the mixing and grinding rooms --helping with hand and bead to establish the high standard of quality which he always fought hard to maintain." Although not technically a founder, Sertno Peck Fcnn wit a fast friend of both Sherwin and Williams, and served the company for 57 years, most of these as treasurer and vie* president. A vigorous man who walked the due* miles from his home to hit office every day, Fessa wis renowned for hi* thrifty habits. Serene P. Ftnm, taubutd "A* the mail came in che morning," marveled an associate, "instead of throwing the envelope# into the wastehssket, [Mr. Fean) would cut them on three edge*, turn them inside out, and use them for scratch paper during che day." Fenn and Sherwin were generous benefactors to the YMCA. with Fenn serving as a director of de Cleveland chapter for 52 years and as president foe nearly half that time. He seas particularly interested in melrinj technical education available to people who could not otherwise afford is. la 1930, due* years after his deads, the Cleveland YMCA School of Technology w* renamed Fenn College in has hosur. In 1965. Fenn College was absorbed into Cleveland Sam University as its school of i 1 0007-SWP-034476 0007-SWP-000113157 Ch a p t e r i: Th e Riu h t Mix tended to cover or ue.tr poorly and acquired a questionable reputation. Although he was on friendly terms with Averill. Sherwin refused to carry these patenc paints on the grounds that it uas "always my endeavor to do everything I could to establish a good reputation by giving good measure and good quality, to avoid every trick that would save a penm at the expense of the other fellow." It was not long, however, before Shenvin. Williams 8c Co. began to manufacture its own coatings. In (3*t. the firm reached in agreement with Murphy 8c Co. of New York co manufacture varnishes in Cleveland under the name of Murphy, Shenvin Sc C<>. A small factory purchased from George H. Kingsley housed this early operation. Two years later, the firm expanded into a one-story cooper shop acquired from Standard Oil along the Cuyahoga River, hired an experienced foreman from New York, and began making paste paints, oil colors, and putty. The first vear of production consisted of about 450 lbs. of coatings, using 8} separate formulas. The firm manufactured its first quality oil color. GSP Raw Umber, on Occober is, i8'l. Sherwin. Williams Sc Co. grew rapidly, posting sales of $688,114.18 in i8~+ and employing some 10 people, including two women, in its factory. During the next few years, although sales dropped as the nation coped with financial panics and a depression, the firm slowly expanded the scope of its business, making its own tin cans and printing the labels for them. In iSt s . it produced its first ready-mix paint, a blue enamel; three years later, it followed with its firsc line of readv-mix interior coatings, sold under the name of Osborn's Family Paint. Sherwin. Williams also took its firsc steps outside of Ohio, establishing first an agency and then, in 1880. a branch warehouse in Chicago, the nation's third largest city. In the mid-t8-05. Sherwin and engineer Henry Coventry developed a new type of stone grinding mill to enable the production of fine colors for coach paints. Patented in 1876. this n-inch mill relied on high-quality bearings and water-cooled grinding surfaces to produce pigments ground to extraordinary fineness and uniformity. The mill proved "so much superior to any others known" that it remained in operation at the company with only minor modifications for more than 50 years. Stone grinding made possible the development of a readv-mix exterior coating introduced in (880 as "Painter s Prepared Paint. Renamed the following year as "Sherwin-Williams Paint" or simply "SWP" this quickly became the nation s best-selling outside house paint. In keeping with Sherwins insistence on selling quality goods. SWP included a guarantee "that this paint, when properlv used, will not crack, flake, or chalk oflf. and will cover more surface, work better, wear longer, and permanently look better chan other paints." The firm offered "ro forfeit the value of the paint and the cost of applying it if in any instance it is not found as above represented." In addition to its insistence upon producing and selling quality merchandise. Shenvin. Williams, from irs earliest years, manifested a prudent approach to finance. As described by Fenn. "the decision was clear and emphatic that progress IV 0007-SWP--034477 0007-SWP-000113158 Th e St o r y o f Ja c k a n d Jil l Henry Shcrwin designed SherwinWilliami's first official logo, a chameleon curled around an artist's palette. Although early representa tion! of the logo were monochromes, they nonetheless conveyed an unmistakable impression of color. In 1899, Treasurer S.P, Fenn returned from a visit to India bearing two chameleons, dubbed Jack and Jill. The pair was put on display in the company's store on Euclid Avenue in Cleveland, where. Fenn remarked, "there is a crowd in front of the window all day and every one learns from the sign displayed chat 'Jack' is the living representative of our trade mark. He has the proper advertising spirit" An author using the pen name "Asher Gray" composed these lines, excerpted from "Jack's Soliloquy," which appeared, appropriately, in Tht Chttmtkete I'm the genuine Chameleon. And 1 came from India direct. My transporter wae our Treasurer, So I am absolutely correct Of the Sherwin-Williams Company I have long been a good mark of trades .And the Treasurer planned to bring me. To let me sec how their paint ir made. For thirty years, at least it is that. They've been making the best of each kind; My colon change on most anything, But on that I will not change my mind. I don't expect to help very much To increase their well established trade. But I certainly will do my share. If I'm only properly displayed. Poor Jack, evidently, was not properly displayed, for he soon died. Jill lived on for many yean, however, and was a periodic attraction at Sherwin-Williams warehouses and stares. iU4 tt 190S, tht Shtrtm-WiUitmiltftfutmtdt chmtinn. Tht tymM wtt ptftdtr with emttmtn and tht temrtt ofgottihtmtr within tit company. Right: 4 rtprtstnutitn f40 SWP toitmuot 4f Jahnwy-tn-tht-Sptt. r 0007-SWP-034478 0007-SWP-000113159 f Hvprm i: I'm Ru.nr Mix >hould be nude no ra-ter than working capital could be prov ided.' He added that rhis meant 'hurt term-.. prompt collections and Friendly banks From which we could make reasonable bo row mgs. .uth which advantage could be taken oFall good Joeounrs jnd purenaws for cash connected vvith stock and all supplies. This prudent approach was o deeply ingrained m the company Fenn insisted, that "there is no itkelihood that see or any others rhat mac come aFrer w ill ever be safe to depart." Fenn also noted the impact on the firm of Sherwins passion for neatness and order. AVe learned earlv rhat a disorderly desk was an abomination in his sight." This attitude, he added, "pertained to the minute detail oFwhat in mans- places and bv many people is cunodered of little or no Importance--soiled blotters, gummy inkstands and pens, -hiftless waste-baskets, and careless exposure oF mail matter and letters in tiling baskets and elsewhere." This scrupulousness was not always appreciated. "Some rimes," Fenn reflected, "it seemed ro us rhar more arrention was paid to these matters than was necessary, but the longer we lice, the less we think so, and the more mosc of us consider them as essential in a thoroughly conducted business at the present time, or any other." By i88j , the firms capital stock totaled sgt.ooo. Osborn, whose interests lay with making and retailing products other than paint, chose to retire From the partnership, selling his stoek to Sherwin. Williams. Fenn, and two other partners. As part of the transaction. Osborn retained ownership ofall retail business, while Sherwin. Williams & Co. focused on manufacturing and wholesaling of oils, paints, and colors. Two years later, the firm took several actions to position itself for Further growrh. To take advantage of limited liability protection, it incorporated in Ohio, changing its name to the Sherwin-Williams Company. Part of the new company's corporate identity was an official logo that Sherwin designed: a chameleon, a tropical lizard capable of altering its color to suit its background, curled around the edge ofa palette. The company also engaged Dr. Percy Nevman. a graduate of the Massachusetts Institute of Technology, as chief chemist. Apparently the first chemist ever employed by any American paint manufacturer. Nevman was charged to ensure the quality of the company's paint and varnish ingredients. 00O7-SWP-034479 0007-SWP-000113160 0007-SWP-000113161 0007-SWP-000113162 0007-SWP-000113163 Ch a p t e r 2 in the hour decades after its entry into the ready-mix paint business, the Sherwin- Williams Company grew to become the largest producer of paints and varnishes m the world, with substantial presences in Canada. England- Australia, and New Zealand. This was a remarkable achievement, for at its founding, Sherwin-Williams was but one of hundreds of small paint manufacturers based in the United States. It rose to prominence, moreover, amid older, larger, better endowed, and better established competitors. And although it gained from the rapidly growing economy of northeast Ohio, its leading competitors, based in the East and in Chicago, sold to markecs chat were growing still faster. To Williams, who reflected on the matter late in life, the source of the company's success was dean it was "entirely due" to che policy adopted at the outset by the managers of the business, and which had been `adhered to. with very few changes, ever since." As he explained. This policy Involved a thorough and comprehensive organization of che business to its minutest details; a determination to sell only such goods as were the best and which would be found to be 50 by our customers; and a representation in the way of traveling salesmen which should be ofsuch a high quality as could noc fail to make its force recognized by all with whom it might come in contact. In short, perfect organization, perfect goods and perfect and honest representation...persiscendy adhered to.... Had he been asked. Williams might also have listed other reasons for che company's success, including the determination of its leaders to grow che business. As Sherwin himselfobserved, competition "did not check our efforts for farther extension, but on the contrary ir served as a conic, arousing our ambition to catch up and get ahead of the older houses." In his view, everyone "associated with me felt this new energy, which has never left us. To me, the whole thing became like a game or contest in which I took che keenest pleasure." Sherwin-Williams began to carve out a distinctive image at an early date. Although SWP, its most succcssftd product by far, was used primarily as an exterior house paint, the company sought to develop high-quality products far commercial and industrial applications. An early slogan ran. `the right quality paint and varnish far every surface.* The company sold coatings far use on railroad cats, carriages and buggies, manufacturing equipment, and ships and marine equipment, as well as far the interior and exterior ofcommercial and residential buildings. In pursuing this strategy. Sherwin-Williams positioned itselfto take advantage of the booming growth of the U.S. economy The development of the 21 00 07-SWP' 0007-SWP-000113165 Ch a pt e r :: Co v e r in g t h e Ea r t h railroad and telegraph networks made it possible to break out beyond regional markets and to serve the growing national market. Sherwin-Williams was among che first American companies--and probably the first American paint company--to recognize the possibilities ot such an opportunity. In isRt-\ Sherwin-Williams opened an office in New York, and signs ot growth svere apparent throughout the company. Sales of railway paints, tor instance, grew spectacularly. The company could hardly have chosen a larger and more promis ing indusrrv to serve. Railroads were the nations first billion dollar industry; by 1880. investment in railroads amounted to $4-6 billion, a coral that doubled within the decade. Railroads were a particular interest of Williams who 'attended many mcetinp of the Railway Masta Car Builders and other railway operating executives." He also "followed closely the development offreight car paint, passenger car colors, and other railway specialties." (n 1885. the company employed a full-time salesman dedicated to developing the market for railway paints. By 1888. profits were sufficiently robust to allow Sherwin-Williams to repay capital supplied by Murphy 8c Co. and to terminate its relationship with that New York concern. In the same year, the company completed its first acquisition, purchasing controlling interest in the Calumer Paint Company of Chicago from the Pullman Standard Car Company, maker of rhe famous railroad sleeping cars. This transaction yielded multiple dividends. Not only did it provide the steady business of supplying one of America's largest companies but it also boosted Sherwin-Williams's presence in Chicago, home of the McCormick Harvesting Machinery Company (later better known as International Harvester and today, as Navistar) and the agricul tural equipment industry. Yet another benefit was the opportunity to employ a young, bard-charging Chicago paint-maker named George A. Martin, who eventually rose to become Sherwin-Williams's tL -J president. Sherwin-Williams po i its first si million sales year in 1890, while capita) in the business had grown to >;oo,ooo. These milestones marked the wav to continuing growth and prosperity. Two years later, the company cemented an important connection in Canada bvestablishing an agency relationship with Walter H. Cottingham. 1 Montreal paint-maker. Born in 1866. rhe year when Sherwin entered the paint industry. Cottingham pursued a career that in many respects paralleled Sherwins. but was marked by even greater ambition. According to an early biographer, Cottinghams "school days were not too numerous." At the age of if he worked as a clerk in a hardware store in Peterboro, Ontario. From there, he moved to Montreal, where he also traded in hardware and paints. By his isth birthday, he had made himself into "a miniature captain of industry." He was proprietor in his own paint-making company, Walter H. Cottingham 6c Co.; senior partner of Cottingham, Robinson 6c Co., a 1) 0007-SWP-034485 0007-SWP-000113166 ^ rr 0007-SWP-034486 0007-SWP-000113167 Onrrm i: Givnuv; rm-. K.verit company ihjt .peci.ili/vd in dyes and dyestuffs: proprietor of the Windsor Chemical Company, makers ot gold paint and gold specialties: proprietor of the Sr. Lawrence Canoe and Boar Company, makers and dealers in canoes, boats, and fittings; and director of the Non-Chemical Laundry Company. Cottingham possessed outstanding gift' a> a salesman, a quality that endeared him to his associates in Cleseland. It seas said, tor csamplc. that "though his goods were higher priced than others. Mr Cotcingham argued that they svere svorth more and then and there prosed his selling ability by making a success of the different lines." By 189-. the agency relationship between Cortingham and SherwinWilliams had blossomed, first into joint investment in a Montreal plant to manufacture SWP. and then into a full-fledged merger. The next year. Cottingham mos-ed to Cleveland to assume duties as general manager of the company. From that time forward, until his retirement in 1922. hesvas the most dynamic force in the company, in 1903. following Williams's death, he svas elected vice president and general manager: in IS309. svhen Shcrwin retired to become chairman of the board. Cottingham svas named president. L'nder his leadership, Sherwin-Williams pursued a strategy of aggressive expansion. Cottingham is little knosvn in business history, although as a salesman and organization builder, he bears comparison to such legendary figures among his contemporaries as John H. Patterson, the charismatic leader of National Cash Register: Asa Candler, the leader who built Coca-Cola into a national brand; and Harley and William Procter, the architects of the modem Procter & Gamble. Indeed. Cottingham had few peers as an inspirational salesman. "Enthusiasm is a good thing," he proclaimed. "It is good to be enthusiastic over the firm you represent. It is not a bad thing to be enthusiastic over yourself. And he went on to note. "But it is even greater if you can instill enthusiasm in others for your goods, your firm, and yourself. Get into something where you can he enthusiastic: your chances of success will be even greater there." The themes of his messages and speeches to the sales force at SherwinWilliams were always uplifting: "Enthusiasm," "Pluck." "Courage." "Do It Now," Staying Power." ".Ambition......rhe Fight is On.' and "Forward Again!" were titles of his editorials in the employee magazine. The Chamtleon. As one admirer noted. "\lr. Cottingham imparts enthusiasm to others as the sun warms that which it shines on. Roads that look steep, hazardous, and absolutely impassable, lose their horror after a fve-minute talk with him." In fact, he explained, "the angle ofvision changes and barriers that appeared to be made of stone turn out to be only 'near-stone' and not in the least formidable." A favorite Cottingham saying noted that "the way to get business is to go after it--don't wait for it to come to you. Others are keen for business. Get there eatlv. Get there first. Get out and hustle." 0007-SWP-034487 0007-SWP-000113168 msssnsm 0007-SWP-034488 0007-SWP-000113169 I.Hv i>i1 k x: Gov h u m, nit FI vatu Cnttinglijm-. r.i!cnI' extended tjr hcvnnd rhetoric, .imi his business srr.ueyv and method' proved rem.irkjblv effective. Thcv began uich a vision co cover the earth with shervvm-W illijms paints. This notion, which advertising manager George W Ford had sketched as early as IS;;, was eventually captured in a new corporate logo. The official change came in wot. when Cottingham persuaded Shcrvvin to abandon the chameleon logo, yhervvin had iniriallv balked at the Cover the Earth' image. n< it because he disliked it. but because he believed that it was inaccurate. At that time, the company') business focused exclusively on North America. Cottingham countered by agreeing that the new symbol was nor strictly accurate, but he argued that it soon would be. Cottingham also displayed a genius for organization. "Business without system is like a ship without a rudder." he said. "System insures a straight course and a smooch successful voyage over the sea of commerce." For Sherwin-Williams. this meant an organizational structure and supporting policies that encouraged efficient production and helped promote sales. The factories in Cleveland. Chicago, and Montreal were the responsibility ofJ.C. Bcatdslee. who served as general superintendent from iS36 to 1910. Distribution and sales were handled by dealers and agents who were given exclusive rights to sell Sherwin-Williams products in their trading area. Following Cottingham's arrival in Cleveland, the company established dealerships and opened warehouses throughout North America at a furious clip. By tv)04. when the company printed its first organization chart, distribution and sales were organized on a regional basis, with the United States and Canada divided into five districts, each consisting of several divisions that included depots, warehouses, and. in a few rare instances, retail agencies. These agencies were established by SherwinWilliams in small-co-medium-size towns such as Worcester. Massachusetts: San Diego. California (1890 population of 16.159): and Binghamton. New York. These retail outlets transacted business under their own names and sold Sherw in-Williams products directly to consumers; Some warehouses also included retail stores, although the company did not encourage (his practice. More important than the formal siructure of Sherwin-Williams was the spirit that animated it. As Cottingham put it. 'the greatest factor in building a large business is organization" and "the greatest factor in organization, in my estimation, is the human factor." He pointed out that "(he reputation of the Company depends quire os much upon the character of men who represent us as it docs upon the character of aur goods and our office methods." Accordingly, the company rook pains to recruit employees with qualities similar to those of its leaders: industry, honesty, courtesy, sobriety, and. of course, enthusiasm. To offset the seasonal swings of the business--most painting occurred in the warm weather months--Cottingham launched annual efforts in the spring to *f 0007-SWP-0344B9 0007-SWP-000113170 0007-SWP-000113171 ( II U`ll R Z: l.lW Hf\l. 111 h h VRIII increase bu-iite-- and Juried vprc.cn I.invc. "nor mill ro hold and merc.ne old trade, but ro prneecutv 4 campaign tor nc account!.. As .1 company num1.1l pur it. Remember th.it "nod paints and urnishes .ire north .1 stood price. Quality always has .1 salue. The best salesmanship. ,i> well as the best manufacturing and merchandising -ue.vs.es h.ne been built upon quality ivi;b a tair price for it. \o permanent or satisfactory success is ever made by sclhost cood,. tor les- than they are worth or in pushing a business on a price basis alone. 7`here is no middle rojd. You musr either huild a business on quality and get rhe price for ir. or huild on price and make the quality ro fit ir. The fherwin-Williams Cat., ar its start, chose the first, and h.n e adhered to ir ever since, and they expect and demand that their representatives should stand for rhe same principle. Be a quality man. Think quality, talk quality, sell quality. If you back up the goods, the goods will hack you up. Like Sherwin. Cottingham was a stickler for derail, order, and neatness. Also like Sherwin, svho had established the first company lunchroom. Cottingham insisted on prosiding congenial conditions of work lor employees, including The best aflighting. heating and ventilating facilities" as well as "clean and attractive cloak rooms, lockers, and lavatories." He insisted that "there should also be. if possible, lunch rooms, reading rooms, and rest rooms. Such investments. Cottingham believed, made -rood business sense: "This sort of work should never be done in rhe spirit of charirv nr in a patronizing kind of way. but solely on the basis that a good staff is deserv ing of the best jnd fairest kind of treatment, and that jnything that increases the cffiv'icncv of the staff is profitable ro the business." Cottingham approached the training and motivation of employees with characteristic thoroughness. Annual meetings of managers and sales representatives to exchange news and information had started in i88t. Under Cottingham. these meetings grew into conventions during which management reviewed rhe years results and offered projections for chc coming sear, and speakers made formal presentations and led discussions on important business topics. Cottingham instituted other meetings and organizations to help improve business skills and build morale. The Get-Together Club, which consisted ofdepartment heads and their assistants, started as a debating society ro help members hone speaking and presentation abilities and grew inro a kind ofgeneral management committee. A similar organization, the Foremans Club, assembled even- two weeks "for instruction and entertainment" and provided an opportunity for supervisory personnel to become better acquainted with each other and their work. In 1911. reflecting the company's successful national advertising campaign around the theme "Brighten L'p Finishes." female employees in the different divisions organized "Brighten Up Girls" clubs. Affectionately known as "BUG clubs." these groups supported charitable activities and engaged in volunteer service. Other 29 0007-SWP-034491 0007-SWP-000113172 S-W-P! Ra h ! Ra h ! Ra h ! During the 1980s, when Americans searched for the secret ofJapanese success in global competition, some observers pointed to the cohesive cultures ofJapanese companies.' These analysts cited the practice in some Japanese companies of encouraging employees to sing company songs is accounting for part of this cohesive spirit. In this respect, the Japanese were following old American example*. Starting in the late nineteenth century and for many years thereafter, Sherwin-Wiliiami' conventions ofmanagers Ra in e o w Ma k e r s Tune `Let Me Call You Sweetheart" Let's bring in the orders For good old S.W.P. Let's paint all creation As it really ought to be Show the world our colors. That will never fade, Sherwin-Williams Products Arc the choicest made. On w a r d Sh c k w in -Wil u a ms Tune `On Wisconsin* Sberwin-Williams! SherwinWUlisnu! Flashed in nightly flame, Old and crusted standards practiced Have spread wide your fiune. Sberwin-Wliliims! SherwinWilliams! Grander dreams begin And one of the few songs ever composed about vertical integration: We Co v e* Th e Ea r t h Tune: "Swanee Rivr` All `round this wide, wide world of ours. Our paints do flow Who* they withstand the rain and sunshine And all die gales that blow. Chorus All the world knows SherwinWilliams Everywhere you go That's `cause we work and play Thai's why we grow and grow. CjcjucmoaaaQsl \v/aafnSsBn Down from the darkest /Bines our paints come. 0007-SWP-000113173 C il wim t!m i h im. mi h mrt company-sponsored organizations included J dec dub. .1 debarins vltih. .1 baseball team, and a benerir society. Many meetings and events were launched by shiwrins: rhe cnmpanv cheer--"Sis--! Boom! Ah--h--h! S-NX-P! Rah! Rah! Rah! --or bv .inline SherwinWilliams wines, with inspirational or amusing lyrics about the companv set to popular tunes oh the day. As the company grew larger, the officers found it useful 10 distribute information about the company in written form "to let the staff knots uhac we are driving at.' In 189-. The Chameleon made the first of its regular monthlv appearances. It reported information on the business, offered advice and instruction to sales people, and included news oforganization and personnel changes. Sherwin edited the first several issues, which sought "to keep everyone in the organization interested in what the company is doing as ,1 whole." In November 1906. at the banquet opening the annual convention. Cortingham introduced "The Shervvin-Wiiliams Code of Principles." ten points that embodied the company's general philosophy. "We put them into the hands of every man who comes into the concern, that he may know what the Sherwin-Williams concern is striving for and what they stand for." The company's aids for sales representatives were exceptionallv compre hensive. The Representatives Handbook, introduced in 190-. ran nearly 4>o pages in length and covered virtually ev ery aspect of the Sherwin-Williams organization and operation. "The boys call it the Sherwin-Williams Bible," remarked Cottingham. who added that "We expect them to know it a good deal better than the average man knows his Bible." A stream of official bulletins offering news of new products, tips on selling, and changes in organization and procedures supplemented the handbook. To stimulate still better sales. Cottingham created the "Top-Notcher" list. Employees who exceeded sales forecasts by the greatest margin, or who otherwise contributed measurably to the company's success had their names inscribed on a trophy and were awarded bonuses. Cotringham's inspirational leadership and sales innovations accounted for much of Sherwin-Williams growth during the quarter century after he assumed the position ofgeneral manager. A strong believer in the value of a diverse product line. Cottingham defined the company's business as making "finishing materials for all uses" and "not one paint for all purposes but a special paint for each purpose." SherwinWilliams manufactured a dazzling variety of over 600 distinct products: paints, varnishes, colors, stains, and enamels. In fact, a company publication noted, 'the only thing of the kind that the Sherwin-Williams Co. doesn't make is artists' colors." The company remained at the forefront of paint-making and varnish making technology. To gain greater control over the raw materials it needed. SherwinWilliams made a series of investments and acquisitions between 1890 and 1910. This vertical integration started on a modest scale, with the company making its own wooden boxes for shipping cans of paint. (The company had made its own paint containers since 1874.) In 1890. the company purchased a steamship, the A.G. Lindsey, to carry M 0007-SWP-Q34493 0007-SWP-000113174 pRWSV*- Under Cortingham t leadership, Stterwin-Williams expanded a^grtsrivefy, supplying io requiremenufur linteed eiiat a plant along the Cuyahoga Biter m Cleveland. 0007-SWP-034494 0007-SWP-000113175 I mi'RR t i Ht F.'.h iii lumber tor these boxes from Minnesota across the Orcat Lakes to Cleveland. Far more amhirious was an investment in wo: to build a linseed oil plant in Cleveland. Two sears later, the sump.inv acquired j mine in Magdalena. S'esv Mexico, to produce zinc oside. jnd a smelter in Joplin. Missouri: soon thereafter, the company built a new smelter in Coffees ille. Kansas. And in iijto. Shersvin-'X illiams purchased a Detroit pigment manufacturer. Expansion was not limited to vertical integration. During the same period. Sherwin-VCilliams built new paint and varnish factories in Newark. New Jersey, and Oakland. California. In pursuit ofCotringhams dream to supply SherwinWilliams paints around the globe, the company forged an alliance with the wel)regarded London firm of Lewis Berger & Sons. Ltd., in 1905. Berger Sc Sons, whose origins stretched back to the eighteenth century, svas renowned as a maker of fine paints and high-quality colors for coaches. The company brought to Sherwin-Williams, or soon added, operations and outposts in Canada. Australia. New Zealand. South Africa. India, and China. The arrangement called tor rhe two companies "to work entirely separately, but to aid one another svhere help was needed or likely to assist in bringing in new business." Sherwin-Williams also established agencies in Paris and Berlin and shipped paints to several ports in the Caribbean and in South America. The character of paint manufacturing was changing dramatically in this period. The age-old practice of mixing paints from natural raw materials was giving way to more scientific and controlled paint-making, using chemically refined ingredients. A sign of changing times was the career of E.C. Holton, who was hired to replace Neyman as chief chemist in 189:. The company's research lab at this rime was essentially a one-man operation that focused on testing samples and quality control. In 1896, with encouragement from senior managers. Holton supervised the production of dry colors from basic and intermediate chemicals, making an eosine vermillion at Cleveland. Three yean later, the manufacture of dry colors was relocated to more spacious quarters in Chicago. By then, colors included chrome greens, iron blues, and many others. Production ofdry colors marked a significant technological advance. In 1898. Sherwin-Williams reached another important technical milestone when it began making varnishes under its own label. These products also required dose chemical control and by 190b. Holton directed a technical team that included nine paint and color chemists. The experimental department then induded *a complete paint factory on a small scale devoted exdusivelv to the making of experimental and sample batches of all classes of painr." During World War I, the technology of paint-making was further transformed. Before 1914. American manufacturers relied heavily on dyes and dyestuffs imported from Germany to make dry colors. Once fighting began, however, these 33 0007-SWP-034495 0007-SWP-000113176 ' i Tkt MtmoStnnr Comfoof of OoieogojorntitSttShoronO)W&mmfmit/n 191?, Mopog to oom tooaooci offoooomt ood otntomiomftudmfor / lAn i^f * oootutulint colon, 0007-SWP-034496 0007-SWP-000113177 Ch apt er Cmmu m, mt. Kar t m chemicals were subject to embargo, and American chemical companies and paint-makers scrambled to supple their osvn requirements. The imported dm were derived from coal tar. and their production demanded a high level of sophistication in chemistry and chemical engineering. With Cottinghams blessing. Sherwin-Williams established a Chemical Product.-. Department staffed by organic chemists, including Nathan E. van Stone and several other chemists recruited from abroad. After "very exhaustive research work." the company, in tgt?, "developed a complete line of intermediates and dyes for color making equal in every respect to the previously imported material.' During the war. Sherwin-Williams also built a plant to make lifhopone. an inorganic white pigment, and supplied organic chemicals to the textile industry. Between 1900 and 1919. Sherwin-Williams revenues soared from si.3 million to sjq.i million. This performance reflected both the booming growth of the economy and Cottinghams relentless drive to enlarge the business. During the war. for example, the company not only supplied huge amounts ofcoatings for ships and military purposes, but it also extended the range of its commercial businesses. Between 19U and 1914. Sherwin-Williams opened its first retail stoics carrying the company name outside Cleveland, in San Antonio. New fork. Pittsburgh. Peoria, and Fort Worth. These stores were not designed to compete with wholesale dealers hut rather to suppo* them by serving as a source of inventory and a testing-site for new ideas and techniques in merchandising. Sherwin-Williams also completed two significant acquisitions during World War I. In 1917. it purchased the Martin-Senour Company ofChicago, a wellknown maker of premium quality paints. Two years later. Sherwin-Williams acquired Hemingway &C Company, a Buund Brook. New Jersey-based chemical maker. .All of the companies Sherwin-Williams purchased continued to operate as independent subsidiaries, each with its ow n brands jnd lines of products: its own research, manufacturing, and sales organizations: and its own distribution outlets. At the close of World War I. Sherwin-Williams was a company remark ably changed from its ea/lv decades. It now supplied a enormous variety of coatings and chemicals from factories throughout the United States and Canada, and in England. It was a giant manufacturing corporation, functionally-organized and vertically integrated from extraction ofraw materials through to final distribution of products to consumers. With sales of more than S34 million, it was also a vast enterprise that was making good on its promise to caver the earth. 0007-SWP-034497 0007-SWP-000113178 0007-SWP-000113179 0007-SWP-000113180 1 0007-SWP-000113181 Ch a p t e r 3 P fciarly in ly 10. the stockholders of Sherwin-Williams voted to raise the authorized capitalization of the company from sat million to s6o million, including sis million in preferred stock to he sold to the public. This move represented the company's first major public financing. The times seemed favorable for such an act. After two decades of furious expansion under Cortingham. the company enjoyed a commanding lead as the largest manufacturer of coatings in (he United 5cates. Sherwin-Williams and its affiliates and subsidiaries, including Lewis Berger. Martin-Senour. and Hemingway, owned and operated }6 manufacturing plants. 90 warehouses, and to retail stores. The company refined its own raw materials, blended them into products of many types and hues, packaged them for a wide variety of markets, and distributed them for sale throughout N'orth America and the British Commonwealth. And it was about <0 post an astonishing 6~ per cent sales increase to a record total of S57.1 million. The company's expanded earnings and capital base provided financing for another burst or growth. In 1910. Sherwin-Williams negotiated its largest acquisition to date, purchasing Acme Quality Paines, Inc. of Detroit for about $6 million. Founded in 1884 by William L. Davies, his brother-in-law Thomas Neal, and rwo minor partners. .Acme h'ad grown to become che largest paint-maker in Detroir. It was a multimillion dollar business specializing in coatings for the carriage and automobile industries. Acme had close relations with automakers, including General Motors. Ford, and the Dodge Brothers. For a brief period prior to World War I. Neal had served as president of General Motors. Acmes properties included the Lincoln Paint Company in Nebraska and the Peninsular Paint Company in Michigan, as well as other manufacturing plants in Dallas and Los Angeles. Sherwin-Williams also invested heavily in upgrading and enlarging its own facilities. During 1910 and 1911. for example, che Oakland plant added substantial capacity to make paint and varnish, while at Bound Brook, the company erected a plant to make acetic acid. Chicago was the sice of major investments, including a new lacquer manufacturing department, and a container plant to replace the original plant dosed in Cleveland. In 19zi, ill health caused Cortingham to retire as president, although he remained chairman of che board until his death in 1930. He spent his last yean at Woolley Hall, an English country estate, where he followed the company's continuing growth from a distance. He remained particularly interested in the affairs of Berger 8c Sons, the London associate firm. Although che two companies subsequently continued their affiliation, che relationship withered after Cocringham's death, and 39 i0007-SWP-034501 0007-SWP-000113182 0007-SWP-000113183 Ch a p t e r Co in in g t h e Co a t in g s Re v o u . riov Sherwin-Williams lost in former ability to market its produces in Europe or in the British Commonwealth, apart from Canada. The new president of" Sherwin-Williams. George A. Martin, was 0 years of age, and amply prepared for the job. A Cleveland journalist drew a memorable portrait oi Martin as being; tall, spare built and angular, slightly stooped. He has a huski voice: deep-set. dark piercing eyes under shaggy brows which seem to be hungrily reaching out to grasp his entire environment: a triangular face with narrow chin sloping up to a broad forehead, a full head of white hair; long arms, long nose, long fingers. He would make a perfect El Greco subject or with cloak, staffand bell hat. would pass for a Pilgrim. Martin was much admired by his colleagues. A teecotaler, he loved to smoke, although never in the office, where he instituted a ban. He lacked pretension, greeting employees at every level on a first-name basis and describing his own job as peddling paint. Like his predecessors. Martin was a self-made man whose education had been cut short by economic necessity. Bom in .Moncello, Wisconsin, in i86f. Martins family moved to Chicago during his early childhood years. He left school after completing the seventh grade, taking a job with a meat-packing company. Three years later, at age 15. he started his own specialty meat-shipping business with a friend. This enterprise began with promise, but its success attracted the attention of larger compericors which quickly put Martin out of business. He then rook a job with the Union Brass Manufacturing Company, makers of railway car trimmings, where be remained for 7 years in various clerical assignments. In 1887. (he itch to start his own business returned, and Martin established a paint company which specialized in railway paints. The business proved a success though he was frustrated by "failure to sell to one of che Railroads, who continued to refer to The Sherwin-Williams Company." A resourceful man, Martin approached Sherwin-Williams in 1891 with an offer to sell that company's products. The offer was not only approved, but Sherwin was so impressed with Martin that he offered him a job as general manager of the Chicago factory. Martin distinguished himself not only in that post, but as manager of the company's Western Sales Division from 1898 to 190;. whew he presided over a quadrupling of business, partly as a result of intense promotion and advertising. His next assignment came in Cleveland, as manager ofvarious manufacturing departments. Elected a vice president in 1916. he was promoted to vice president and general manager of the company five years later. Martin assumed leadership of Sherwin-Williams during a difficult period. A sharp recession had resulted in a two-year decline in revenues, and che company did not surpass its 19ZO sales record until the late 1910s. Revenues crested at s8i.j million in 1929. then they plunged again during the Great Depression, bottoming out at s j i.S million in 1933. In that year. Martin earned out the unhappy task of cutting the payroll 0007-SWP-034503 t 0007-SWP-000113184 0007-SWP-000113185 Ch a pt e r .1: Jo is im: rm Co*ris<;.s Re v o u h o n ,ind slashing employment, although the company continued to pay dividends. S'ot until the late i9.;os could management fed reasonably confident that the worst was over. This economic roller-coaster was only one of several challenges to the company during the interwar years. The pace oftechnological innovation quickened with a great change sweeping across the economy in this period: the "chemicalization" of American industry. During the [920s and !9.:os. the advantages ol synthetic materials in terms of uniformity, standardization, reliability, controlled availability, and lower cost, became apparent everywhere. Man-made products replaced 'natural" products, and chemically controlled processes supplanted customary methods in textiles, materials, paper, printing, adhesives, perfumes, rubber, glass, cement, asphalt, and. of course, paints and varnishes. The chemicalization ofthe coatings industry created both problems and opportunities for Shcrwin-'X'illiams. Prosperity in a world oftechnological complexity required the company ro remain abreast of the latest scientific developments and to continue upgrading its rechnicaJ capabilities. It was also necessary to wield marketing clout to fend oft"competition from new and unexpected rivals such as the chemical giant. Du Pont. As the leading supplier of paints and varnishes in North America, however, Shcrwin-'X'illiums was poised to profit from the transformation of the industry. New competition was keenest in markets for industrial finishes, especially those applied ro the eras most eye-catching product, the automobile. Between 1918 and 19x9, production ofcars in the United States soared from less chan I million to nearly 5 million per year. Two factors accounted for this explosive growth: Henry Fords demonstration of the power of mass production, and General Motors" demonstration of the power of mass marketing. Ford's manufacturing advances drove prices steadily downward: in the 1920s. a new Model T sold for less than $250. The `Tin Lizzie* had a significant drawback, however. As Ford himselfput it, customers could have a Model T in any color they wanted--so long as it was black. The reason: black baking enamel, which could be oven-dried quickly, was by tar the most efficient finish available at the time. General Motors could not compete with Ford on price, so it sought instead to segment the market by offering 'a car for every purse and purpose.' A key element ofthis plan was an ability ro offer low-priced automobiles in a variety of styles: and colors. During the early 1920s. researchers at General Motors and Du Pont developed a jprayable. quick-drying, low-viscosity lacquer made from nitrocellulose. Not only did the new lacquer dry much taster than the old enamel--in z hours, as opposed to 24--bur it also permitted finishing in a wide artay of colors. Introduced in 1923, the new lacquer scored an immediate hit. and within three years. General Moron overtook Ford as the worlds largest automaker. >S 0007-SWP-034505 0007-SWP-000113186 0007-SWP-000113187 Ch a p t e r t; Jiiimn o niEOnriNiis Re v o u t io s By the mid-i9:os. automotive finishes recounted tor nearly a tench of all paint sales in the L'nitcd States. This spectacular growth was mirrored in other industrial finishes, is quick-drying lacquers rendered mass-produced items, such as appliances and furniture, more attractive and appealing. In 1911. Sherwin-Williams entered this fast-paced field with the first of a new line ot'lucquers under the trade name Opex. Developed by a team of' researchers led by van Stone. Opex lacquers adorned Packard cars and eventually found their way into other industrial uses. In the mid-t92Qs. the company pioneered a brushable lacquer for household use called Rogers Brushing Lacquer. One of" the besc-selling products of" its subsidiary Acme, during the 1920s. was a iron-oxide primer that served as the base coating before the application of spr wable lacquers. Sherwin-Williams renewed its n to technological leadership in this period by developing synthetic resins which m.ue varnishes and enamels competitive with quick-drying lacquers. In 1929, the company introduced its first synthetic finishes, a line of Kern-enamels. In subsequent years, research and development spawned many ocher advanced coatings and finishes chat used che Kem trademark: Kem Air Drying Enamels. Kem Railway Surfacers, Kem Art Metal Finish. Kem Bulletin Colors, Kem Store Front Finishes, and Kem White Appliance Enamels. Research also focused on improving dry colors. In 1929. the company developed a process for making "dispersed colors" directly from dry color pulp without resorting to the time-consuming traditional method of evaporating che water, breaking up the lumps into powdered dry color, and then mixing in oil or varnish. The new process entailed flushing our the water and mixing and grinding the particles with oil or varnish to get a smooch paste of tine and brilliant texture. The resulting colors consisted of smaller particles that could be wetted more thoroughly, chus producing higher gloss. The new process eliminated "bloom" in reds, reduced bronze in blues, and increased film durability. These characteristics yielded superior results in paints, enamels, lacquers, and printing inks. The interwar yean witnessed a proliferation ofcoatings and finishes for specialized uses in industry, commerce, architecture, and consumer markets. Advanced technology and chemically controlled manufacturing processes made it possible to engineer products tor a wide variety of application methods and circumstances. Sherwin-Williams could tailor its coatings according to customers specifications for Jrying-cime. temperature, climate, exposure to hazardous conditions, and other situations. One of the most promising new markets with unusual requirements was che aircraft industry. Before the advent of aluminum-skinned aircraft during the late i9)os. most airplanes were covered with fabric that was created with a lacquer for protection and decoration. The rapid growth of the aircraft industry after Charles Lindberghs successful flight across che Atlantic led Sherwin-Williams to create an Aeronautical -0 0007-SWP-034507 1s 0007-SWP-000113188 0007-SWP-03450B 0007-SWP-000113189 r\ \ I CHMTE* t: Jo imm; rut On TIM,> Rk v o l l russ Sales Division. In ll*2S. SherwinAX illiatm introduced its Aero Enamels, featuring a velvet finish which give a plane a handsome appearance, good visibility and ha the added advantage of being so elastic that vibration created by the plane rushing through the air will not crack rhe finish.' In addition to growth into new. specialized applications. Martin guided expansion of MiervvinAX tlliams through more traditional means. In !0;0- the company acquired rv '.-ailing paint-makers. Lowe Brothers of Daytnn. Ohio, and John Lucas of Oibbxboro. New- Jersey, one of the oldest and best-known manufacturers in the industry. These transactions included many established brands of high-qualicy paints. Lucas, for example, had previously acquired WAX'. Lawrence it Company of Pittsburgh, itself a well-known producer. Martin also pursued opportunities for Sherwin-Williams in Central and Latin .America, where he saw the market for high quality paints flourishing and contributing to economic development. In 1930. the company opened a retail branch in Mexico City and acquired a paint factory in Havana, which it expanded jnd operated as the Sherwin-Williams Cumpanv of Cuba. Later in the decade, spurred by. the success of chis venture. Sherwin-Williams built a plant in Argentina, and established an affiliate company in Brazil. Under Martin's leadership. Sherwin-Williams expanded assertively in consumer markets. In 1913. to help increase public understanding of the dizzying variety ofcoacing products on the market, the company announced its "Household Guide tor Painting, Varnishing. Staining and Enameling, calling it "the biggest idea that has hit the paint and varnish business in fifty years." The guide featured a matrix that listed types of pr. and surfaces along one axis and ty pes of coacing produces along the other. The meeting boxes specified the Sherwin-Williams produce most suitable for the .it riication. For example, to coat indoor furniture, the guide recommended Enameluid as its choice of paint: for other types of applications, the guide proposed Scar-Not Varnish. Floor-lac stain, or Old Dutch Enamel. "For the first time." proclaimed company literature, "the public will have a handy reference guide to help them with their paint and varnish problems." The company spent heavily on advertising .md promotion to strengthen the Sherwin-Williams brand and help establish the cover-the-earth logo as one of the best known in the world. As explained by C..M. Lempcrly. advertising manager, the company's advertising budget was divided ab'out equally between national and local medio. "We use national advertising to keep our name before the public. Our outdoor cutouts and signs keep our Cover the Earth' trade-mark before people constantly. When we use national magazines we get into products a little mote, but the style is still pretty generaL" In 193s. at the request of Martin, an opera butF the company began nsoring Sunday afternoon broadcasts of auditions lor the Metropolitan Opera. 0007-SWP-034509 0007-SWP-000113190 \ou can't paint a house with APPLESAUCE -- b b o During d)t imrrwaryears, SherwinWUliamr /ought to prturvt and ' protect itspremium intagp through aggrtaivt advertising rout expansion ofits retail outlets. The company's HanmDocoratar and Color Guido, Ai 14 in 1910. provided uphhtieated `drier and information to architects, professionalpainters, andhomo oumtnfor mart than 50yean. 3 0007-SWP--034510 0007-SWP-000113191 < h \rrER Io im\c rut l_<vv rives Re\ou rtnv "With nervork radio we arc entirely institutional. noted Lemperly, who added thjt commercials were kept to a minimum. "This restraint has brought us no end of compliments from listeners, although our sales department ac time would like to have us pound assay a little harder for sales. This opportunity came later in the Cleveland area, when Martin, a director of the Cleveland Indians Baseball Club, arranged for >herwin-Williams to sponsor game broadcasts. Advertising ac the local level was far more aggressive. During the late ij io s . for example, the company encountered stiff price competition from makers of low-cost paints. A gallon of SWP sold for S4. while rival brands were available for as little as s:.to per gallon. To counter this threat, Sherwin-Williams bunched a. major campaign against "cheap paint." Proclaiming that "this will be no kid-glove affair." Lemperly announced the company's objective as "not a 'draw,' but a real 'knock-out.'" In essence, the campaign stressed chac "cheap painc" was not ar all cheap, because it covered less area per gallon, wore less well, and used inferior ingredients when compared co SWP. Consumers were warned. "Don't Be Fooled on House Paint!" and to wacch for 'a Joker in the Cheap Painc Can." This campaign, claimed Lempcrlv. was "the kind ... that President Calvin Coolidge would endorse too per cent because it strikes at waste and false economy and emphasizes true values." The company's retail outlets also practiced aggressive selling tactics. During the 191os. Sherwin-Williams began opening a handful of stores in major metropolitan areas in order to gain "satisfactory representation" in these areas, as well as "to protect our interests' from competition. Starting in the late 1910s. che company accelerated the establishment of retail stores across the L niced Scares. Sherwin-Williams opened an average of between five and ten stores per year, and occasionally more. In 19.16. for example. 14 recall stores were opened. The stores carried not only SherwinWilliams coatings, but also painc brushes and ocher materials. The company stressed that its retail scores were not intended to replace but father to supplement its network ofwholesale distributors. As described by an official policy manual, "Our Stores act as the Company's service stations, and everything should be done in them to cement closer the relation between the agents and dealers served through che Store in addition to securing a greater market chrough your Store for our materials." Store managers, who were Sherwin-Williams employees, were encouraged to be "os obliging" to wholesalers as they were to their own customers. .As the official policy noted. "Increased profits from such quarters helps you in your profits, helps the factory in its output and lowers the cost of manufacture bv which all benefit." Sherwin-Williams approached retail management with a consistent business philosophy. Cottinghams "Code of Principles" was prominently featured in che Reriiil Store Handbook which passed chrough many editions. 0007-SWP-034511 0007-SWP-000113192 Evolution ofa trademark; the first logo ofAt Sherwin-Williams Company -- a chameleon curled upon a paintrr'ipalettt--mat adopted in 1884, Atyear afAt company i incorporation (top left}. In 1890, Sherwm-Williams advertising mantgtr George Ford designed a legofir tfledgling manufacturer efocUaning compound in winch ht hadan interest (top center). When At small company dissolved, Ford began to play wiA ideasfir adapting At imagefir ShotwinWilliams (top right), settlingfinally on At concept ofa can pouring SWP upon a globe tilted so os to make Cleveland, Ohio, At point from which At restafAt tank was covered (bottom left). First uud on packingslips at Ae Worcester, Massachusetts store, by 1903 the Cover AeEarA mage had been sintplified (bottom center) and registeredat Ae company's trademark. Through heavy advertising such os Ae billboard cut-outfrom the J930t (bottom right), it became one ofthe besshnostm tredemarks in American business. 1 0007-SWP-034512 i 0007-SWP-000113193 Ch a p t e r j : Jo in in g t h e Co a t in g s RtvoiiTiox More specific advice in (he Handbook bespoke the company's traditional values; "Nothing looks so bad as a dirty, mussed up Score, but a well kept, near and orderly Store is a wholesome place in which to do business. People like to come in as well as to recommend the place to their friends." "Stories or jokes of an unclean character will not be permitted. It's a good plan to put this rule into effect even outside the Store and business hours." "A Store may have the best ofeverything in merchandise, delivery or anything else, but if politeness combined with kindness s lacking, the Score will not progress, nor in fact last very long." . Other advice reflected the times; "It's not in keeping with good manners to walk around the Score wearing your har, and certainly not polite to wait on a lady customer wearing your hat or without wearing your coar." Like ia counterpart for sales representatives, the Retail Store Handbook provided a wealth of tips to increase sales and profia: "Never greet a woman customer with `Gut I show you something/ or 'Yes, ma'am.' Rather begin with 'Good morning' or 'Splendid weather for painting, is it not?' Gee her in a cheery, receptive mood and show by vour manner you are there for service as well as sales." "Remember eight out of ten people who are going to do a liicde job ofpainting need a brush." "Sell the customers something besides what they ask for, It's no trick to sell them something they want--that's simply waiting on them." "Give the same attention and treatment to che shabbily dressed as you do to the well dressed. They may have their money tied up in houses, which need painting, instead ofclothes." "The real test of che paint and varnish merchant is to get the money in the cash drawer--have this consrandv in your mind." Sherwin-Williams marketing caches proved effective, and the company's recovery from the Great Depression was rapid and strong. A maker of diverse products chat controlled che production of its raw materials jnd its channels ofdiscribucion. Sherwin-Williams was a fundamentally healthy enterprise. In 19)9, the company maintained tf.ooo active paint formulas, produced 15 million gallons of paint, and recorded sales of$95.8 million, tc remained the largest coatings manufacturer in the world, despite formidable technological and competitive challenges. Bigger challenges and greater rewards were soon to come. ; j j j j i I ; i j j I ! | I 51 0007-SWP-034513 0007-SWP-000113194 Faint goes Co u ar: an illustration from a 10 f l Sherwtn Williams World depicts same surprising uses ofpaints in America V defense. 0007-SWP-034514 0007-SWP-000113195 0007-SWP-000113196 0007-SWP-000113197 Ch a p t e r 4 in M40. George Martin retired as president of Sherwin-Williams jt the age of "9. To >uccenl him. the board of directors elected Arthur W. Steudel. then 49 years old. SteuJel had joined the company in 190!) as an office boy. He earned his first promotion within two weeks, and then rose through a series of clerical positions in the Trade Sales Division. In 191', he attracted the attention of Edward M. Williams, son of the (bunder and head of the Railway Sales Department. From there. Steudel's dirnb was swift. In 1914, he was a department head in the Chemical and Dye Division, which he eventually led as manager. In 191). he became assiscanc to the ptesidenc, supervising development of the company's lacquer business. In 19J7, he became vice president and general manager, and the heir apparent. Steudei was a very popular leader, remembered affectionately as a short, 'roly-poly' man who played a whole round of golf with just two five irons (in case one broke) and a putter. He was also active in business and community affairs in Cleveland. Sceudel took charge of Sherwin-Williams at a favorable rime. In 1940. che company had earned the industry's admiration for a marketing first, introducing the Sherwin-Williams "Paint and Color Style Guide." The company printed 45.000 copies of this handsome, oversized book for its distributors and retailers. It featured color photographs of many types of houses, including interior scenes, to help customers choose appropriate colors for many different settings. "Never before has such an array of actual homes from all over the United States been displayed in color photography." boasted the Style Guide, which noted that the photographs were `on a scale that makes you fed you are almost stepping into che rooms--standing right before the houses.' Capitalizing on che Style Guides success. Sherwin-Williams posted a record year for sales, copping $100 million for the tint rime. The outbreak of World War II had an immediate, positive effect on the paint industry, and manufacturers geared up for defense production on a massive scale. Thousands ofvital military items required paints, including camouflage paint for tanks and supplies; blackout painc; aircraft, boat, and truck finishes: and coatings for grenades, bullets, and bombs. Every soldier was equipped with eighty-five separate items, each with its own special finish. Moreover, che road building, construction machinery, water supply, and electrical lighting systems necessary to a military campaign also required paint. As che war continued, che U.S. government became Shcrwin-Williamsi biggest customer; Converting Sherwin-Williams to massive defense manufacture was a challenge char engaged evervone. Production personnel devised ways co distribute work loads evenly between plants. Plant engineers converted old equipment co new 0007-SWP-034517 0007-SWP-000113198 0007-SWP-034518 0007-SWP-000113199 < in iprm 4: M or h im. m W o manufacturing uses. Purchasing agents vombed the country tor raw materials, even minor ingredients. >o that shortages would noc halt production and delivery. Chemists v\penmented with old. almost forgotten oils and resins and treated them with modern pmcevnug equipment. Salesmen rolled up their sleeves and worked in the Factories, adjusting 'pray guns and checking thinners. Ultimately, some plants devoted Sto per vent nt their capacity to war work. As more and more male employees were called to active duty, women became indispensable to Sherwin-Williams operations. By 194}. female employees comprised one third of" the company's work force and were found in factories, labs, and retail stores. And. as the ShrniDi-WiUi.uns World, the employee newspaper of" the time acknowledged. "Some of the jobs the women are doing are. in truch. being handled /use a little bit better than a man would do them.* In all. 1,756 Sherwin-Williams men and women entered the armed forces, and 90 per cent were welcomed back at the end of the war. In 1941. Sherwin-Williams became involved more directly in the war effort. The company was drafted to construct and manage an enormous shell-loading plane in Carbondale. Illinois, as part of 1 program whereby such facilities were built by well-known manufacturers. A (earn of' 60 Sherwin-Williams employees oversaw the construction of the plant, hiring 15.000 workers to construct the 15.000-acre facility in less than a year. Sherwin-Williams also subsequently managed the plant's operations. Staffed by d.ooo workers, the Carbondale plant produced enough bombs each day to supply a nightly RAF raid on Germany. Sherwin-Williams demonstrated leadership in producr innovation, as well. The company's research chemists, led by van Stone, began experimenting with new coatings concepts. They took casein, a white milk and cheese protein used by the ancient Egyptians for making painc. and emulsified, or suspended, varnish into it. They then added a number of components of traditional oil paint as a base. The new formulation consisted of 23 different ingredients. In 1941, Sherwin-Williams put this new painr, called Kcm-Tonc. on the market. At the same time, the company embarked on j major sales and advertising campaign--the most ambitious in the history of the enrire industry--spending SI million on selling the new product. Kkm-Tone was marketed as the '`modern miracle wall finish." described as .u easy to use that it was ideal for homemakers and for those who had never used a paint brush before. Demonstrators around the councry showed that, thinned only with tap water, it completely covered svallpaper. plaster, and painted watts, without requiring messy primers, sealers or thinners. Only a single coat was necessary and the paint dried in one hour. Advertisements also stressed that Kem-Tone was more washable than oil paint, and like the finest washablk wallpaper, ir could withstand "too rubs with a doth under a two pound weight. 0007-SWP-034519 0007-SWP-000113200 fttPAIlt CRACKS? *1U* Hm PLASTIC PATCH FlU ejatfko 304 helm quickly oat Maly 'iU* ih* Rxuvvieu* *w pltuik iiUor. Juol mta ia woif an4 apply. Na uAdareuiiiof r owhn old pie*!*# roquirodL PtlM qusckly. Will a* shtinfc. crock t fall out. XOU IT OH! 23* raitmo mMtw r*rtC* ROLLERKOATER N# ao*d * worry cboul ih* watetfy o4 bruokoo wkaa you apply Kaa-Toaa! iuat ua tba )Un> Taa Itsilac'KMiar. ii roll* Xo m-To m rifki a** yuiwaibaadailiafO<ittiekly.#a*UY.oa#afkiyf 0Q(f 4r 7 t CACDT <*u m ruw n w TRIMS .Gumma* roady ( ajrfriyj G*o KnT<maltAikad roea* th* kocotaJor'* louck-- wUh Xn ?M Trim*) Guaaod roady io a^Sy. !h*y <**( o* cutttof out, pauu* or giuuvj. !u*t4lp i* wauw*d uoaotkaa wa*L Aim * WALL " tout MIADQtf AMiM Xhe modern miracle wall finish I J o?. 3<SS 0 0 ?. Si'Vjb 7 73. So7 Ch a p t er a: M a r c h in g ro War The company took unprecedented measures in distributing Kcm-Tone. as Avcii. For the first rime, it went outride its closely knit dealer and Franchise organization, supplementing traditional practices with direct selling and distribution. Any retailer in good standing, including filling stations, grocery stores, and drug stores, could handle the new product and become a special Kem dealer. Ultimately, SherwinWilliams secured 65.000 new outlets for Kem-Tone. The new paint was sensationally successful and quickly outsold its competition in the interior paint market. Continuing war shortages forced Sherwin-Williams ro respond creatively. Japan's blockade of China resulted in shortages of pig bristles, which were used ike paint brushes. In 1941. Richard C. Adams, a Sherwin-Williams engineer and a d- . ..ndant of Presidents John Adams and John Quincy Adams, invented a revolu tionary new device called the Roller-Koater. Devised in Adams's basement, and constructed simply of jute and wood, the Rollet-Koater was designed for Kem-Toning only. Inexperienced painters found it easy ro use. Adams, an inveterate tinkerer and inventor, also made miniature Roilcr-Koaten for charm bracelets and lapel pins. Sherwin-Williams devised innovative paint packaging, as well. Ac fine, shortages in steel and tin required the company to sell Kem-Tone in glass jars with cardboard carton overcoats. In 194a. in a plant with secondhand and homemade machines, Sherwin-Williams began producing cans made of paper. Carrying the company's Graphic Arts Division label. "War Emergency Container--Handle with Care." the new cans were slightly larger and more fragile than the standard metal cans. Sherwin-W'iltiams chemists applied (heir ingenuity in a number of other important ways to support the war effort. They produced vital war materials that had been German monopolies and unobtainable in the United States :f vests earlier. At its New Jersey chemical plant, rh e company made 85 per cent of the nation's coral supply ofacetanilid. This basic ing. dient in the manufacture of infection-fighting sulfa drugs was part ofa packer provided to each soldier. These sulfa drugs were considered a miracle: a record-breaking number of American wounded recovered from rheir injuries. At the end of the war. Sherwin-Williams could look back over five successful years. Despite shortages of raw materials and personnel, its wartime program achieved its goals. On the domestic side. Kem-Tone hit the 37 million gallon mark in 1945. selling out of stores just as fast as it was stocked. Having already secured a such a large portion of the domestic paint market, the company's conversion ro peacetime work was not difficult. 59 0007-SWP-034521 0007-SWP-000113202 0007-SWP-000113203 0007-SWP-000113204 0007-SWP-000113205 Ch a p t e r 5 Am t the end of World War [I, corporate America turned its attention away from war production and back to domestic markets. Sherwin-Williams, tike other American companies, embarked on twenty years ofgrowth fueled by national economic prosperity and an enormous pent-up demand for consumer goods. Although it was already the universally recognized leader in the coatings industry, the company established itselfeven more firmly during this period by growing and developing a pronounced mail orientation. Although Sceudel. whose strength was in marketing and sales, firmly set Sherwin-Williams's overall postwar direction. Vice President Luther Schroeder tightly controlled the rest of the company's operations. Schroeder joined the company in 1908--the same year as Sceudel--as a bookkeeper. He worked his way up through the ranks, succeeding Fenn as Treasurer in (922. In 194). Schroeder was elected a vice president. His long tenure (he died in office in 1960. in his {2nd year with the company) ensured that the Sherwin-Williams tradition of fiscal conservatism endured. Schroeder guarded financial information closely and refused to allow the company to borrow money, even during the Depression. These practices paid offi SherwinWitliams's securities were considered "widow and orphan stock." and the company was noted for having never missed a dividend. During the posewar era. changing patterns in housing and consumption provided an enormous boost to paint sales. Before World War II, most Americans had lived in cities--in apartments, flats, or sometimes small houses--often in cramped conditions. When the war ended and servicemen returned, public policy helped under write the great migration to the suburbs. Federal loan programs made ic easier to acquire a home, and during the 19)0$. one-fourth of the American population moved into suburban housing developments. An enormous, built-in market was created for all kinds of consumer goods, particularly paint. Fueled by America's strong economy, postwar family income virtually doubled, allowing for an unprecedented level of consumer spending. These developments helped ensure that Kem-Tone, already the industry leader, would remain the largest-selling wall finish on the market. In 1948 alone, more chan ti million gallons of Kem-Tone were sold, fat more than any other brand. Even SWT. which doubled its sales in 1948 after suffering from severe supply shortages during the war. only reached one-third of Kem-Tones sales. Kem-Tone's popularity encouraged Sherwin-Williams to expand its Kem line of paints. In [949. the company introduced a new type ofalkyd, or oiTbased,. enamel painc called Kem-Glo. which was advertised as appearing and washing like the 63 0007-SWP-034525 0007-SWP-000113206 Ab r o a d - Despite Henry Sherwin's doubts, Sherwin-Williams'* "Cover the Earth* logo proved to be as accurate description. Bjr 1907, the company had established an agency in Mexko, and by tba 19x0s, Sherwin-William* exported ns S.. ath America. Europe, Africa. .. fie Fat-East. Lsuer, it created sui diaries with their own manufacturing facilities in Mexico, Cube, and Brazil. In the 19*01, Sherwin-Vdfiama took a different approach to intenarional expansion. Instead of establishing subsidiaries in different countries, it invited leading foreign businessmen to sign licensing agreements far manufacturing Shccwin-William* products in plants built foe that purpose. The company provided the operational expertise, the paint fr Jas, and the supervisory i. nJinical personnel. By 1966, "-Williams had licensed . mies in Argentina, Colombia, -sador. Pern, the Philippines, and Venezuela. In addition, the company sold specialized license* to make Sherwin-Williani* automobile refioishcaand other chemical and irwjn.rrieimetings. Prior to the 1970a, SherwinWilliama organized its inctrnatioa* al businesses as a collection of unconsolidated subsidiaries. Then it formed an International Group, as pan of a restructuring ofthe entire Sberwiea-Williania organiza tion. By 1977. Intctntrinnal had"** become one of the live division* the Costinga Group. By 1991, Sherwin-Williams was in volved in 44 separate vtnturca, through subsidiaries, 1 joint ventures, and licensees, in }1V different countries. Although the company considers itselfa domestic organization that has international activities, and nor a global corpora* tian, its international businesses are important. It has, fee example, subsidiaries in Puerto Rico, Mexico, Brazil, and Panama, and joint ventures in Saudi Anfcia , and Ireland. It also contbnM*n^-f> liiwu nnnsp ffghnnlnglea i to manufacturers in many othmrlP*' countries and to expand through*-- 00O7-SWP-034526 0007-SWP-000113207 <.'n\rrF.H Th e Po s t % \r Bo o m I baked enamel on a refrigerator. Kem-Glos fast-drying and long-bearing properties made it an instant success with consumers. A year later. Sherwin-Williams j introduced Super Kem-Tone. a deluxe interior paint with a new ingredient, latex emulsion, that made it both washable and extremely durable. The Kem line of'paints proved extraordinarily successful, and by tgtv a total of more than too million gallons had been sold. The company's overwhelming success partly reflected SteudcTs ambitious postwar plan to increase the number of branch stores owned by Sherwin-Williams, j and thereby extend the company's control over the distribution of its popular paints. In 1948. the company managed approximately 400 stores in its nationwide branch i organization, which was divided into eight regions, each headed by a regional director. Over the next fifteen years, the number ofstores increased dramatically, and in some yean, the company added more than too new stores. It was a heady time: headquarters employees heard exciced shouts across hallways in the Cleveland offices. "How many stores today?" This pace continued until 196s, when the number of stores across the country reached approximately 1.000. Having met its growth objectives, the companv's strategy thereafter was to expand at a rate more closely geared to population and needs. Sherwin-Williams personnel carefully chose score managers for their new scores. They visited local ministers and bankers to find highly responsible and motivated residents who might not have the capital to start their own businesses:. The desirable personalify profile of the prospective store manager often matched that of a Steudel or Schrocdcr. or even, for that matter, a Sherwin: upright and conservative, yet entrepreneurial. Over time, it became clear that the most profitable stores developed in rural areas, where the manager became pan ofa closely knit business community and had the paint market to himself. Some of these rural managers made more money chan anyone else in their area, and banked in other towns to conceal their wealth. Branch store managers proved very entrepreneurial. There were no standard operating procedures for stores, although they were periodically audited. Given this freedom, stores could sell, in addition to paint, almost every cool a painter or paperhanging contractor needed on the job. Most stores sold wallpaper, and others successfully offered carpeting, draperies, and curtains. To offset seasonal dips in paint sales, many stores also had gift departments that carried pictures, pottery, mirrors, and even rovs at Christmas time. Queries regarding whether a certain item was in stock was likely to be met with the joking rejoinder. "I'm sure we have it somewhere!" .Ml the stores carried paint sundries, such as brushes, rollers, and trays. The Kem-Tone brush, equipped with special bristles chat picked up and carried more paint than conventional brushes, proved especially popular. To supply these kinds of items to its increasing number ofstores, in 1953. Sherwin-Williams built a plant in 65 0007-SWP-034527 0007-SWP-000113208 0007-SWP-000113209 C'ii 'run I. I'.if To-ra ,H B, Dcshler. Ohio to make patching paste, caulk, brush cleaners, rollers, covers. and tras s. The Deshler operation was a unique factory, set deep in farm country, with a production line composed of more than 60 per cent women. Three years later. Sherwin-Williams acquired the Rubberset Company of New Jersey and Canada, the world's largest manufacturer of brushes. Founded in t3~t. in its early Jays. Rubberset had manufactured shaving brushes, toothbrushes, hair brushes, and scrub brushes for physicians, In 1954. Bristol-Myers acquired the company, and. thereafter Rubberset cooperated closely with Du Pont, the producer of'the first nylon filaments. Together they dev eloped the first nylon paint brush in 194). Subsequently. Rubberset became known as a leader in the nylon brush industry. Throughout the 1950s. paint sundries became Fairly elaborate, providing decorative challenges for the ambitious do-it-yourself customer, in 1954. SherwinWilliams introduced Apptikay. a new type ofdouble toller used only with Super KemTone. One ofthe two rollers laid on paint in one color, while the other, with one of five designs etched into it. "appliqued" paint ofanother color in a pattern onto the wall, much like offset printing. .Another new product. Multicolor, was a latex paint composed of a solid color base that also contained small flecks of contrasting pigment. Multicolor spray painting was done by fitting a home vacuum cleaner with a special applicator and reversing the vacuum's air flow. Under Sreudel. the company continued to lead the industry in promoting and advertising ics paint products. At the time. Sherwin-Wiiliarm paint was approximately 15 per cent more expensive than other brands, and it never went on sole. The thrust in marketing was to catch the customer's eye; once inside, the manager would explain why Sherwin-Williams was the paint to buy. Store window displays therefore concentrated on devices to attract attention. To replace the ubiquitous pyramid ofpaint cans in many store fronts, Sherwin-Williams managers devised other eye-cacching ideas. One of' the most successful was a device consisting of three cans of Super Kem-Tone welded together, char revolved around at 90 rpm. The whirling paint cans drew people into the stores, demanding to know how the device worked. Another example was a life-size, three-dimensional St. Bernard dog with a can of paint tucked under his chin and with a sign that read, "Rescue drab rooms with Super Kem-Tone!" The company also sought to retain its position as a premium paint manufacturer through its array of promotional books and guides featuring SherwinWilliams products and providing decorating advice. In 19?'. it modified the floor design of its stores to create a nook for women to browse through its too-page "Paint and Color Style Guide." The Style Guide was only available in SherwinWilliams srores. and occasionally, the manager would allow a customer to take it home overnight. There was also a Style Guide "Companion.'' an album of IJ9 pages 67 0007-SWP-034529 0007-SWP-000113210 lit tddition to thefriendly unit* available throughout the network of Skerwtn-Willutmi end its Affiliate*, Sherwin-Willianu branch stores featuredthe "Style Guide," the Kent Colormeter. and many household products, such as wallpaper and floor tile. 0007-SWP-034530 0007-SWP-000113211 (..II u>rm v Th f . i'n.Tw v r Bi'iim portraying the mosr popular Super Kem-Tone colors. Sherwin-Williams scores also carried a color selector, known as the "Cascade of Colors, " which contained six-inch square color chips that a customer could take home to compare with the existing decorative scheme of his or her home. By the early 1950s. Sherwin-Williams was also providing its customers with a "Color Harmony Guide" containing a fan-like .pectrum of painr colors ro assist in the choice among 1.500 different color combina tions. Over 100.000 "Color Harmony Guides ' were distributed annually around the country for the next few years, and in 1959, over 500.000 copies were made available through the dealer and the branch-store network. The company also gave away a long-running promotional magazine on color selection and paint application called (he 'Home Decorator." Although it was also distributed through dealers and stores, 'Home Decorator," first issued in 1910. was specifically targeted to homemakers, and. in many areas, local troops of Boy Scouts and Girl Scouts delivered it door-to-door. In 1959, tz million copies of"Home Decorator' were distributed, 8 million more rhan in ipft. Throughout the mid-1960s, the magazine, whose annual editions were unique within the industry, served as an authoritative source of home decorating information both in the United States and abroad. Branch stores also provided other helpful services to build business and satisfy customers. For example, they established charge accounts allowing customers to "paint now, pay later." Customers could take four to five months to pay for their purchases without incurring interest or carrying charges. Stores also arranged for free home delivery of paints and ocher goods, for free house inspections with the purchase of painr, and for recommendations on reliable local painting contractors. Another Sherwin-Williams service was the Kem Colotmeter Mixing Machine, a power-driven device that was introduced in (959, Until che invention of the Colormeter. developed at the Deshler plant, all paint was premixed and prepackaged at che factories. Using che Colormeter, a paint merchant could dispense measured amounts ofconcentrated colorant into any type of paint; over 1.000 colors could be mixed and dispensed in the store to customer specifications. .Although architectural products constituted about 80 per cent of Sherwin-Williams business at this time, and consumed most of its attention, the postwar period saw significant expansion in the area of industrial finishes. Innovation proceeded so rapidly on the industrial side that, in I9S9- over so per cent of the company's industrial finishing products had appeared on the market within the previous four years. Each factory relied on its own research lab, but ro boos t che crcnd toward technological innovation, ground was broken on a new major research facility in Chicago in 1960. In the same year, after io years at the helm. Sceudel nominated E. Colin Baldwin to succeed him as president .As thecompanys chief operating officer. Baldwin 61) 0007-SWP-034531 0007-SWP-000113212 The company V Canal Roadfacility in Cleveland as it appeared in the 1970s, Running along the Cuyahoga River below the Midland Building headquarters, it inetuded thefactory which grewfrom the origuuU cooperage ofl97J and the office building built in 1981 that hadalso served once as corporate head quarters, A bridge between the office and thefactory crossed railroad cracks which ran over the site ofthe former Ohio and Erie Canal I 1 i i i 0007-SWP--034532 0007-SWP-000113213 C.iu p t e r 5: Th e P'd '.-t m, ut Bo o m managed operations, while Sceudel remained chairman of the board, directing police and financial matters. Although Baldwin had already served i6 years with the company, he had not come up through the tanks like previous company leaders: his Harvard Business School education allowed him to start higher up. In 1946. he began a lung tenure as Steudds special assistant, interrupted by a brief seine as executive v ice president of the Canadian subsidiary. In 1959. he was named vice president and general manager of the entire company. In contrast to the congenial Sceudel. Baldwin was more aloof. He was also known to be very formal: visitors to corporate headquarters not only wore ties and jackets, but many of them also brushed their teeth before meeting with him. In the early 1960s. Sherwin-Williams continued its work in product development, introducing a new exterior latex house paint called A-100. This followed on the product line ofexterior latexes called Loxon introduced in 1958. which were used to cover scucco, concrete, and brick. The company also expanded its range of paints to suit different customer needs. In addition to exterior paints SWP and A-too. scores and dealers sold Super Kem-Tone. Kem-Glo. and a lower-priced line called Excello, for interior use. They also sold Rust Control Primer to fight the "Rustoleum'brand, and Marvethane, Sherwin-Wlliams's first polyurethane retail varnish. Sherwin-Wlliams also entered new coatings industries in the first-halfof the 1960s. In 1961. for example, it began chemically finishing construction materials while they were stilt in their prefabricated state. This strip or coil-coating work became Increasingly important, especially as aluminum siding and metal buildings grew more popular. In 1961. the company brought out Kcm-CIad and Super-Clad finishes for pre-finishing wood, aluminum, steel, and metal, and Thermo-Clad insulating varnish for use with electrical and electronics products. During the postwar era. Sherwin-Wlliams made many improvements in production, marketing, and distribution to keep up with rising demand. It continually introduced new products that affirmed irs place as the industry leader, and sophisticated promotional materials secured its reputation around the wo rld. The momentum built up by postwar consumer demand and the extraordinary success of the Kem line allowed the company to reach an unprecedented level of growth. By the mid-t96oj. sales of about ssoo million placed it as number 178 in the Fortune >oe list of industrial companies. No other company in the paint industry had, a distribution system comparable to Sherwin-Wlliams: its approximately 1.850 branch offices and 53.000 dealers provided it with 57 per cent of its sales. In 1964, almost a century after its founding, in celebration of its prosperity and growth. Sherwin-Wlliams chose to list itselfon the New York Stock Exchange. 'I 0007-SWP-034533 0007-SWP-000113214 0007-SWP-000113215 0007-SWP-000113216 0007-SWP-000113217 Ch a p t e r 6 |n 1966. Sherwin-Williams celebrated the 100th anniversary of Henry Shenvins entry into the paint business in a spirit of enthusiasm and confidence. During this anniversary year. Steudel retired as chairman alter 58 years with the company, leaving what appeared to be a very sound enterprise, free ofdebt, with recordbreaking earnings, and commanding by far the iargesc share of the market for coatings in the United States. The growth and expansion of the Steudel era, however, masked significant long-term problems, many ofwhich traced back several decades. One fundamental tension arose out of the success ofKem-Tone. During its first 75 sears, the company had earned a reputation for premium quality exterior oil paint tor professional painters. After 1941. however, Kcm-Tonc's extraordinary success took Sherwin-Williams in a new direction: the easy-to-apply latex paint was ideally suited to the new mass market of the do-it-yourselfhome decorator. Sherwin-Williams pursued this market eagerly by expanding its store network and catering to retail consumers. Stores reinforced this trend by carrying many new home decorating and improvement products, including waxes and polishes. Yet at the same time, they still sold to their traditional customer base of professional painters and building contractors. .As long as demand remained high and the company prosperous, the tension remained below the surface. The rising cost of raw materials, however, exposed serious problems. The coatings revolution of the 1910s and t9jos had made SherwinWilliams accustomed to yearly decreases in the price of raw materials. Each yean the company raised retail prices a bit. resulting in a comfortable margin. This pattern continued during World War II. when commodity prices and demand were both artificially regulated. The postwar period brought a new instability to this way of life. With the pace ofchemical innovation slowing, and wich the outbreak ofpostwar shortages, the cost of raw materials began to level out before rising ominously. The paint industry could no longer rely on an extra bit of margin each year. Sherwin-WiUianu s profits began to decrease until, by the early 1960s. the company earned less per gallon than at any time in its history. High volume masked this trend, but as the tremendous pentup demand of the postwar period tapered off. sales began to slow and profits; to plunge. Sherwin-Williams suddenly found itselfin the uncomfortable position of a high-cost producer. Part of the problem lay with production costs. The company had remodeled and built few plants during rite postwar years, and as a result, many operations were outmoded and inefficient. 75 0007-SWP-034537 0007-SWP-000113218 0007-SWP-000113219 Ch .m*t s r 6: Sp r u c in g Th in In 1966. Baldwin embarked on a four-year, suo-miliion expansion and diversification program, a projected expense chat equalled the total capital expenditures made by the company over the previous 51 years. Baldwin chose co finance this program by borrowing large sums for the first time in the company's history. SherwinWilliams then proceeded to build or modernize a number of paint and chemical plants, warehouses, and research and development facilities. It opened an efficient new paint factory in Morrow, Georgia, a new container plane in Elgin. Illinois, and chemical plants using new titanium dioxide and alkali blue pigment technologies. It also began work on a new research and development center in Chicago, named in honor of'Steudel. Baldwin also sought co diversify foe company to offset slow growth in foe paint business. In pursuing such a srraregy. Sherwin-Williams followed for: example of many American companies for which tax laws and antitrust considerations made diversification an attractive option at that time--in 1968, for inscance. twice as many business mergers occurred in the United Sates as in any previous year. SherwinWilliams made force major acquisitions. In 1966, it bought Maumee Chemicals, a company which specialized in foe production of saccharine and paracresol (used to create BHT. a widely used anri-oxidant that kept food fresh). In an effort to st rengthen the small aerosol container line it had began in [956, Sherwin-Williams also acquired, in 1966. Spravon Products ofOhio, a well-esablished aerosol packager specializing in spray paint. Two years later, it acquired Osbom Manufacturing of Ohio, a producer of power-driven brushes and custom-made foundry equipment. Osborns history was closely intertwined with that of Sherwin-Williams, having been founded by A.T. Osbom, a former partner, in foe nineteenth century, of Henry Sherwin and Edward Williams. John Sherwin Prescott, a vice president of Sherwin-Williams and grandson of Henry Sherwin, served on Osborns board of directors. . As a result of these acquisitions, the company reorganized in 1968 into three functional departments. The paints, varnishes, and coatings department included chemicjl coatings, trade sales, and automotive refinishes. The pigments, colors, and chemicals department included the specialty chemical business and foe pigment and dye businesses. The paint-related products department included sundries, such as containers, trays, and brushes. Sherwin-Williams faced a serious challenge at this time arising from an increasingly important retail phenomenon within the paint industry, foe massmerchandising or discounc store catering exclusively to the do-it-yourselfdecorator market. Those discounters and mass merchandisers who wanted co sell foe powerful Kern line in (heir stores directly threatened Sherwin-Williams's carefully structured and very successful distribution system for its Kern products which it had built up in foe early 1950s. It sold each paint product at one uniform price throughout the 77 0007-SWP-034539 0007-SWP-000113220 0007-SWP-000113221 Qf.smea 6-. Sp r e ad in g Th is nccwork of its approximately t.;oo company-owned scores. 10.000 authorized dealers, and jo.ooo specified Kem products dealers. In 1958. changes in the law brought an end to this network. Thereafter. Sherwin-Williams and its affiliated companies, such as Martin-Senour. Lowe Brothers, and Lawrence, could only suggest, but riot specify, retail prices (or Kem products. Sherwin-Williams had tried to anticipate the rise ol discounters, and agreed to permit K-Marc department scores to sell its paint in leased departments. There were 191 K-Marts around the country selling Kem-Tone by 196'. Increasing numbers of discount chains, however, wanted to sell Sherwin-Williams products, and were able co obtain Kem and other paints from its affiliates. Further changes in the law required Sherwin-Williams co relinquish its exclusive deal with K-Marr and to release ics Kem brands to any discounter who wanted co sell them. These chains then sold Kem paints at half the suggested price, and deeply undercut Sherwin-Williams's company-owned stores and dealers. By 1971. with its exclusive arrangement lost, and with price competition accelerating, K-Mart decided co assume control over Sherwin-Williams' leased paint departments, although the company continued as K-Marts supplier. In 1969. in the midst of this whirlwind of change. Walter O. Spencer, former chemist. Chicago plant manager, and vice president of Operations, succeeded Baldwin to the presidency. Baldwin, in turn, became chairman of the board. Ac 4a. Spencer was the youngest company president since Sherwin himself, and was expected to '`inject large doses of innovation and vitality" inco the company. His brightly colored shins, moustache, and long sideburns reinforced 1 brash reputation. Noting that he didn't "always do what's expected." he began to tty to shake up the company. His mission was to "work wonders" on Sherwin-Williams's old-fashioned organization and conservative management team. Having observed the overwhelming success of the discount retail chains, and taken the measure of the booming do-ic-yourselfpopulation, Spencer decided that Sherwrin-WiiUams should pursue the lucrative home remodeling market. Unless it did so. he believed that the company would lose its standing in the market. Spencer was also convinced that the company needed to target the newer and more numerous customer group of women and younger buyers, rather chan rely on the traditional, and shrinking, base of men over 4s years old. "We wanted co get Mrs. Jones to chink of our place ifshe had a decorating problem," Spencer asserted. In one scop, a customer could get carpeting, window treatments, wallpaper, and paint. Spencer sought to transform many Sherwin-Williams branches into retailing operations. The company already had the most extensive store network in the industry; what it needed, he insisted, was some image-polishing to attract the do-it-voutself public In 19-*. the company launched its "More chan a Paint Store" "9 0007-SWP-034541 0007-SWP-000113222 07-SWP- OOOII3223 Ch as t er 6: Sp r e ad in g Th in Advertising campaign. Stores were decorated with eye-catching window displays showing that they were rescue stations, beauty and antique shops, cravcl agencies, and school houses--not just paint stores. The company offered unusual promotions in this advertising campaign. For example, when a store waS*decorated like a beauty shop and the rheme was "we beautify your home." a customer could buy a szo lighted mirror ("or siy When the store was a travel agency and the theme was "your passport to a painting adventure." a customer was offered luggage at a discount. The company also ran hall-page ads in Life magazine, showing its stores as retailers ofhome-improvement products staffed with individuals with specialized expertise. Still. Spencer believed, more needed to be done. "We weren't going out and asking our customers what they wanted to buy, how they wanted to buy, and where," he stated. 'We had not upgraded the stores and were not aggressive enough in the marketplace. We needed more pizazz!" As a result, he inaugurated a more ambitious retail strategy and launched a massive effort to upgrade some stores and to establish others in metropolitan markets. These "Idea Centers" were designed to meet all homedecorating needs. Sherwin-Williams hired women to wdtk in these stores, advertising that customers could "Ask Shirley Williams" lor advice on picking wallpaper, carpeting, and draperies. By lace 1974. over 600 scores provided professional decorating consultants to assist customers, with a new "Color Harmony Guide" to display coordinated decorating ideas at a glance. At the same rime, the company embarked on an extensive market surveydesigned to provide information about how employees, ocher companies, and members of the public viewed its 75 year-old "Cover the Earth" logo. The research showed that although the symbol was one of the worlds five best-known, it confined the company's image to that ofa paint manufacturer, rather than a retailer of many home-decorating items. "The logo had been around for a long rime." conceded Spencer, but he believed that "the company was more than die logo would indicate." He felt chat the I image did not capture the diversity ofSherwin-Williams businesses, including saccharin, specialized chemicals for foods and perfumes, organic chemicals, textile chemicals, containers, brushes, machinery and foundry equipment, adhesives (SherwinWilliams had recently acquired Hadley Adhesives, founded in 1906. a custom formularor of glues and adhesives), graphic arts, and aerosols. Rather than continue to restrict itself to the 'Cover the Earth" logo. Sherwin-Williams chose to focus on its name, which the research showed was one of the company's strongest equities. Top management sought to convey a `broader" image, and launched an ambitious corporate identification program to devise a new print logo displaying its name in bright, crisp, blue-aad-white colors, and chen to spread the new symbol throughout the company. In 197V, as part of the second stage of its retail thrust. Sherwin-Williams opened a new store, unique in the American home-decorating scene. This pilot 31 0007-SWP-034543 0007-SWP-000113224 0007-SWP-000113225 CHArrinfr. Vu k u h v c Th is venture, called 'Decorating World* and located in Charlotte. North Carolina, was many times larger than a traditional 4.000-square foot Sherwin-Williams branch, and was designed to act as a laboratory for new marketing techniques. Decoracing World offered customers both a complete selection of decorating products, including paint, wall and floor coverings, draperies and other window treatments, and seasonal teems, like lawn furniture and kitchen and bath accessories. All of these items were available in various price categories. Decorating World also provided innovative customer services, such as "how to* decorating clinics and a child-care center. Unfortunately, efforts to change the company's image proved much more complicated and costly than anticipated. Creating a new logo and implementing the corporate identification system alone cost S15 million. Relocating, upgrading, and enlarging stores and expanding product lines proved enormously expensive. Decoracing World, in particular, in the words of one Stores executive, was a "marketing success and a business disaster--too complex and too costly to operate." Even after the upgraded stores began to attract home improvement customers. Sherwin-Williams management had insufficient retail experience to capitalize folly on their patronage. The new retail strategy also risked alienating the stores's traditional base of professional painters and building contractors. Ultimately, the company's thoroughgoing efforts to capture a new market while attempting to retain its traditional one made for a divided approach that served neither sector properly. Forces external to the company further undermined Spencers initiatives. Half the cost of a can of paint derived from its raw materials, most ofwhich were based on petroleum. In 19-4. the energy crisis made raw material costs skyrocket, causing Spencer to acknowledge that, "in terms of margins, the good old days are gone, particularly in the paint business." Federal wage-and-price controls barred the company from raising irs prices and forced it to borrow money to cover operating expenses. In addition. Sherwin-Williams' traditional strategy of investing heavily in raw materials was no longer paying off. and its Chemical Division began to lose money. Technology was changing so rapidly that even large infusions of capital could not guarantee Sherwin-Williams a competitive market position. Many of the plants it had bought or built over the past decades produced pigments and chemicals that were in danger of becoming obsolete in the coatings business. Instead of using 90 per cent of its own raw materials, Sherwin-Williams had to sell 90 per cent to other companies: what hod been vertical integration had become horizontal integration, with the company continually working to sell these products to others. Hopeful ofa turnaround. Spencer pressed ahead, divesting, closing outright, or converting a number of pigment and chemical plants. (n 197s, in a major effort to counter discounters who were increasingly using Sherwin-Williams branded paints as loss leaders. Spencer made a controversial decision to remove Sherwin-Williams paints from all markets except the company's 83 0007-SWP-034545 0007-SWP-000113226 An In n o v a t iv e Op e r a t io n A plant tour during opening day at the Richmondfacility. Inset; Rett Silberstein, plant manager, and Len Ward, automotive refinish . on president, smile as th- ;epe the Richmond employees' coeck. The charter of die Richmond automotive tcfinish facility sated u iu purpose, "To construct and operate a safe, clean, efficient plant in Richmond that will produce the highest quality automotive re-finish plant in the world and keep itself ahead of the industry in compcdtiveneit and profitability.* The plant which opened la. October 197$. has mom than lived up to its charter. It is an innovative operation, organized not around tradii >al factory hierarchies, but aiounu '`open systems manage* ment," When it first started production, skeptics regarded tbit approach, which involves the employees in all aspects of produc tion and quality control, aa a radical experiment which would oot succeed. They soon discovered their error. The Richmond plant immediately set the standard for all SherwinWilliams plants anywhere in the world. Productivity is )o per cent higher than in comparable plants, and the cost per tallon of finished products made at thia facility ia a full 49 percent lower than at other plana manufacturing the same products, While a number of factors have contributed to in high level of productivity, management attributes most of the cost reduc tion tn the plant's human resources- No ocher plant in the industry has had as many continu ing safe hours under its belt. In 19(0, the Richmond plant won the Narional Safety Council's Award of Merit for logging over a million employee hours without losing a single workday because of an accident--reflecting a perfect record since opening in 1976. Work at the print is done by nine teams, each responsible for a diffident function, acd a team leader coordinates the team's eSorts. Each member learns, and rotates through, all die team's job*. Even the plant architecture is spedfically designed u integrate workers into tbe process; there are no assigned parking places, no separate entrances, and no time docks. Everyone has the same benefits program, including an incentive plan. In 1984, in an extraordinary move, all 100 plant employees derided, after a landslide vote, to plow some of their productivity bonus money back into the company. They presented Sherwin-Williams with a check for sit,z8a.71 to cover the costs ofbuilding a safety access rood behind the plant. "The attitude ofthe employees brought a lump to my throat snd teats to my eyre,* said Leonard Ward, division president and general manager at the time "My first reaction was to refuse the gift--it's so large Then they mode me realise that this is their own very special way of expressing their appreciation to Sherwin-Williams." 0007--SWP-034546 0007-SWP-000113227 own stores. In return, the company gave its longtime dealers generous financial terms and proposed chat they sell the Martin-Senour brand instead. Many dealers, however, chose rival brands with more established market shaces. and Sherwin-Williams lost (i million gallons of paint sales in the transition, representing to to is per cent of its total paint sales volume. Although implementation proved costly, this move was 'Cen as imperative for Sherwin-Williams to recapture its own name brands and ro allocate its different paint lines strategically between mass marketers, dealers, and its own stores. Spencer also sought to replace old plants and technology. To become the low cosc producer of the coatings industry, he earmarked SlOO million in capital investment to build two new piano, an enamel and lacquer coatings facility for auto refinishing in Richmond, Kentucky, and an emulsion plant in Chicago. The plant dedicated to the automotive refinish business was long overdue. In 19)8, SherwinWilliams had invented acrylic enamel, a significant technological breakthrough that applied easily and dried instantly. From this invention came a new product, called Acrylyd, chat was introduced in 196). To show how easy it was to use. demonstrators applied Acrylyd in tuxedos. This new acrylic enamel technology, and later, isocyanate technology, proved so successful chat, in che 1960s, the company began to open its own specialty automotive branches. Business soared for the "refinish experts." as they called themselves, and Sherwin-Williams went from last place to become the numberrwo supplier ofauto refinishes in the United States, and third or fourth in the world. By [975, Sherwin-Williams operated fifty automotive branches; with business increasing at ao per cent a yean automotive refinishing was die fastest growing part ofthe company. Despite its success, the auto finishes business suffered from second-class status in che company. Its managen had to "beg, borrow, or steal" production capability ouc of the coatings plants and adapt this, which was difficult as auto refinishes involved "high tech' processes which were expensive. The decision to build the Richmond plant was a clear signal that the company was serious about developing this area of its business. With its new production capability, the division actively pursued a multibrand strategy ofselling Sherwin-Williams automotive refinish products from its branch stores directly to body shops; selling its Martin-Senour brand to National Automobile Parrs Association (NAPA), a distributor chat was the worlds largest chain of automotive aftermarket stores: and selling its Acme and Rogers brand through scill other channels. Industrial coatings was another business segment that yielded innovation and expansion during the 1970s. The coil coating business, one of the fastest growing paint markets, grew ar t5 per cent per year and involved a wide range of customers. 85 00CI7-SWP-034547 Potaste, an important new industrialfinish, was introduced in 1971. Top: a PoLanefinishing line. in 1977. Sherwin- VTUliasm announced itsfins major reorganization m seven decodes. The product officeyean ofstudy and changes inside the company, the new structure groupeddistinct businesses into separate divisions, tack hooded by a general manager. miwe tenni'in paints, uuliislnd? yamts. taipslwg wi,n r -w pih ic j ,. consume! yrtini'S, I.rfnps Chemical; Teihle cheru fragrances. s. clo.Miog .igen soft vIw v k s , vaneu cffqmtcals. alkali tilua .,liginerits Packaging Products labels five qaJtan pa Is. ,ifrosul. tolar selection r .trris. Juocrtures Specially Products Pamt tiufcs, paml spreaders. anti rust spray*, .'iv.t spatter mate/iat far welding lips SherwinWilliams Canada Consumer paints, decaraliw! accessories, minors International Coatings Paint. (Jjporl fed a T ; 1 J 0007-SWP-034548 0007-SWP-00011 Ch a t t e r 6. Sp r e a o is c Th iv including the business machine, structural steel, and the aircraft industries. Innovative industrial coatings research and development emphasized energy-efficient coatings. In t97t, tor example. Sherwin-Williams introduced Polane. a successful new industrial polyurethane finish which could be applied to a wide variety of surfaces without baking, and which was very effective for use on heat-sensicive plastics. Polane. which had been first developed in the 1960s by the Lowe Brothers affiliate, soon set the standard in the industry. Despite positive showings by chemical coatings and automotive refinishesi and even though sales volume for the rest of the company reached an alltime high. Sherwin-Williams earnings in the early 1970s continued to be disappointing, having dropped steadily firom their peak in 1966. In fact, the rapidly accumulated acquisitions and the capital expenditures of the late [960s, combined with the further expenditures and new directions of the [970s. had produced a highly diverse, debt laden company. Spencer remained upbear, however, contending that "a price had to be paid" for the new Sherwin-Wiliams, and that in feet, the company was approaching its strongest position in yean. In 1976, he initiated a wave of selling off operations, including Osborn and a rexcilechemicaJ plant. The company also sold plants in Detroit, Dayton. Gibbsboro. and in Europe, as well as a lab in Toledo. All told, it took Sf6.4 million in write-offs from these transactions. When he first took office. Spencer had been determined to reverse Shersvin-Williams's too-year history of centralized control. He had long chafed at the company's top-down organization and the paternalistic relationships chat grew ouc of it, convinced that such a system was increasingly ill-suited to a rapidly changing business environment. Starting in 19/t. he began a series of restructurings in order ro change the company "from a traditional, highly centralized, functional organization to several business area organizations, each headed by one man responsible for sales, production, research and development, and accounting and control in his business area." The company reorganized along divisional lines, creating five profit centers of Coatings, Chemicals, Auxiliaries. International, and Sprayon, all of which were organized into groups. It instituted a formal strategic planning function and over hauled the financial office. In 1976. Spencer restructured the Coatings Group under its own vice president. He then broke it into three divisions. Consumer, Automotive Rcfinishcs. and Chemical Coatings. Although he sought to make each of these responsible for its own profits, sales, manufacturing, distribution, and research and development, they were not decentralized in their operations, and were not true "profit centers." In addition, the overarching corporate structure remained in place. By 1977. this restructuring was essentially complete. Under the new system, the Coatings Group included for the first time undet one umbrella the diverse collection of autonomously run affiliate companies and all the different subsidiaries of 87 0007-SWP-034549 0007-SWP-000113230 A*. 0007-SWP-034550 0007-SWP-000113231 i Ch a p t e r 6: Sp r e ad in g Th is Sherwin-Williams. It was, in turn, restructured into five divisions. These included Consumer, which encompassed all production, technical development, distribution, and direct sales of paint, other than chemical coatings and auto refinishes: Trade Stores, which was responsible lor all sales, merchandising, advertising, and operation of the company-owned stoics: Chemical Coatings: Aucomorive Aftermarket branches; and International Coatings. Other groups included Chemicals; Packaging Products, which managed containers; Specialty Products, which managed Sprayon and Hadley Adhesives: and Sherwin-Williams Canada. Despite Spencers determined efforts, Sherwin-Williams remained, in his words. "a troubled company.' Although he predicted chat it would break even in 1977, the actual financial results for chat year proved much worse. Ar the end of the fourth quarter, the company reported a loss of tS million on sales of st billion, and its interest expense exceeded its earnings. Sherwin-Williams was unable to pay its dividend for the fuse time in its history, and ic owed $196.6 million in long-term debt. The value of its stock had plunged from the high 140s to the stot in little more than five years. Fallowing this distressing performance, serious questions were raised about the company's financial controls, and the board of directors re-organized itself to include fewer insiders. As the stock price slid precipitously, the company became a takeover target. Several Cleveland companies considered buying Sherwin-Williams, and Gulf Sc Western, a well-known conglomerate, was on its way to acquiring 13.4 per cent of the company's stock. In Match 1978, Spencer resigned, citing the frustrations ofcrying ro decentralize a company of Sherwin-Williamss massive size and formidable ctaditions, and of rrying to fashion a market-driven organization from a production-focused structure. "The job is no longer any fun." he said. He was succeeded by 60-year old interim president William Fine, who had been a member of the board for over twenty years, and who bad held ol'a number of top financial and operating positions in the company. In the meantime, the board launched a search for a new president. j 89 0007-SWP-034551 0007-SWP-000113232 nr#'t 0007-SWP-000113233 0007-SWP-000113234 0007-SWP-000113235 Ch a p t e r 7 Sfherwin-WHiams ended the [970s in crisis and entered the 1990s in prosperity. Looking back over these years, the story divides into three fairly distinct periods: a turnaround phase, a search for new growth opportunities, and finally, the present phase, still unfolding, in which the company is refocusing on its core business of coatings. In January 1979, with bankruptcy looming, the board dramatically broke with tradition, hiring an outsider. 45-year old John G. Breen, as president and chief executive officer. The Cleveland-born Breen had been an executive vice president at Gould, a large diversified company. At Sherwin-Williams, he quickly became known for his aggressive management style and blunt talk. In fact, in his strongly-held traditional values, and deep impatience with self-indulgent habits--especially those that had an adverse affect on the company--he resembled Henry Sherwin. Within a few months. Breen departed from past Sherwin-Williams practice by assembling a youthful, professionally trained, cop management team. Conway G. Ivy. a soft-spoken Texan with whom Breen had worked at Gould, arrived as vice president of corporate planning and development. Thomas A Commes. a risktaker whose experience with croublcd companies made him ideal for Shetwin-Wiliams, and who had worked at Gould as well, was named senior vice president of finance. Although Breen freely admitted. ~ I didn't know a damn thing about the paint business." the new management team brought a tough-minded approach, which included rigorous planning and implementation methods and tight financial controls. In addi tion to these newcomers. Breen relied heavily on a strong base oflong-time operational heads and middle managers to provide knowledge and continuity. The immediate priority was to reverse the company's financial slide. Sherwin-Wlliams's ballooning long-term debt and its chronic reliance on short-term borrowing to finance its day-to-day operations made bankruptcy seem a certainty. "My estimate, after spending a month here." noted Ivv. was that "we were probably six monchs away from bankruptcy. " Others disagreed, thinking it might be nine months or ten. The first step. then, was to determine where the company made its money and to generate cash quickly. Sherwin-Wiliams began negotiating with suppliers for extended payment schedules, the implementation of cash management techniques, and the drafting of checks from the branch stores to headquarters electronically. i The next move was to understand and obcain control of SherwinWiliamss many different businesses. To gather data, the new management team met monthly with all top executives to review operations. Given the company's fortunes at the time, these first meetings were sometimes pretty grim. In detailed written plans. i \ l>3 i 0007-SWP-034555 0007-SWP-000113236 0007-SWP-000113237 Ch a p t er t : Re n a is s a n c e is Co a t in g s managers explained the nature of (heir businesses, including produces, strengths, weaknesses, competitors, and future plans. Every division began to submit annual operating plans, and from these, the company developed comprehensive policies that included budgeting, strategic planning, and management assessment. The setting of these meetings vividly highlighted one aspect of the culture change broughc by the new management. Breen immediately created a stir by holding them, over box lunches, in the company's boardroom in Cleveland head, quarters. This room, which had always been kept closed when the boanl was not in session, with a pad over its conference table, had the air ofa ``mausoleum." Within weeks, however, it took on a more lived-in feeling. A series ofstrategic planning sessions, attended by top executives and division managers, were directly tied into the new budgeting process. These provided the necessary information for Breen's management assessment plans, which formed the structure for the company's future direction. Strategic planning and budgeting were "bottom-up* efforts. One of the first things that Breen made perfectly dear was chat he did not expect to run the company from the top. Instead, authority to set goals and the responsibility to fulfill them was delegated to people as far down in the company as possible. Top management played devil's advocate, ensuring that goals were realiscic. After that, Comma noted, top management got "out of their way and lei them do their thing!" By giving operating staff the autonomy to make important decisions, and by installing information systems that could measure and coordinate objectives, the company effectively reversed its historical orientation toward centralized control. For the first time since the divisional structure had been introduced in Spencer's era, division managers were held directly accountable for their performance. Decentraliza tion proceeded further by converting the company's nine domestic divisions into profit centers, and by installing a rigorous management accounting system chat charged the divisions for the use of working capital and fixed assets. According to rhe vice president of human resources at thiis rime, Breen was "absolutely unrelenting in terms of performance." To Breen, it was simple: "Once the plans had been agreed upon, people were expected to do what they said they'd do." His demands for accountability and responsibility were a dramatic change for (hose Sherwin-Williams employes who expected to receive their bonusa once a year like clockwork and for those who thought of themselves as working for the company for life. During these first years, many difficult decisions had to be made about personnel. The standards were high but everyone was given an equal shoe to succeed. The turnover was most drastic among the company's cop executives, while a strong cadre ofexperienced operations managers remained, lo monitor and reward performance, the company instituted executive plans ried into the planning, budgeting, 95 0007-SWP-034557 0007-SWP-000113238 0007-SWP-000113239 Ch a p t e r Re n a is s a n c e in Co a t in g s and the management assessment process. In addition to the top executives, SherwinWilliams developed compensation plans tied to incentives for many other employees, particularly store managers and sales representatives. These measures had a positive effect. By che foil of 1979, the company had cut its long-term debt by sa; million, stockpiled suo million in cash, andl doubled its accounts payable. On October )o, 1979, Breen convinced Gulf Si Western that the continuing possibility ofa takeover hurt efforts to rebuild Sherwin-Williams. The company bought back its outstanding shares, which amounted to 13.4 per cent, for szt million. Following that crucial success. Sherwin-Williams restored its dividend, which it had been unable to pay since 1977. In [980. Breen was elected chairman, and later that rear, after conferring with employees and outsiders, he revived che "Cover the Earth" logo. Removing the takeover threat marked the end of Sherwin-Williams short-term crisis and che beginning ofa decade-long second phase, characterized by growth in the coatings business, by divestiture of the unprofitable Chemical and Container Divisions, and by short-term diversification into drug scores. At this time. Sherwin-Williams was still organized in four basic business segments, or Groups. The first jnd largest was the Coatings Group, which consisted of four operating divisions: the Chemical Coatings Division: the Retail Stores Division (ofapproximately 1,400 scores): che Consumer Division, which manufactured paint and distributed it through various marketing channels to home centers, national retailers, and hardware dealers: and che Automotive Aftermarket Division (formerly Automotive Refinishing), which made and distributed coatings for vchide repair and maintenance. The remaining three business segments included the Chemicals Group, which produced additives used in agricultural chemicals and foods and beverages: the Container Group, which provided cans for paints and other consumer products: and a Specialty Group that manufoctured painting tools and accessories such as brushes and rollers. To facilitate true decentral ization. Breen eliminated the Group Vice Presidents who had reported to the president. Once freed from this cumbersome management layer, the heads of the operating divisions throughout the company reported directly to Breen. The Coatings business was by for the strongest segment. Steady demand had risen over the 1970s for new chemical coatings, partly because metal had doubled its share of the construction components market In 19-9, the Chemical Coatings Division introduced a product ailed SupetCIad two, a heat-cured, high-performance, and tong-lasting vinyl coating for rhe aluminum siding industry. The division also introduced its PowetClad process, which produced the fim foil-gloss, gloss-retentive, cathodic finish for electrocoaring general metals and form equipment In addition, the division developed an important niche market in priming original equipment for plastic automobile parts. In 1984. an advanced formulation called Polane GhuCtad was >77 0007-SWP-034559 0007-SWP-000113240 Sernafrom the Sbenem-WUEams family album (clockwise): 1991 membra of Sbtrwm-WUEatnt't Coda ofExcellent*. Eachyear, abenlenefifib eftbecompanji salm managtn became membra by meetingformidable talar assdlarprofit pah (tap). Employees m aformula central lab meattert tUspeoian (right upper middle). Twa employees at the Graphic Arts Department, Fountain ben. Needs Cantina (right lower middle ostd right bottom). An employee at the Ckuegt Emsstdass Plant (left, bottom). A SherwinWUliams rtprtsentatsee inspecting a coating application at on industrialplans (left center). 0007-SWP-034560 0007-SWP-000113241 <!h APTR " Re .NAISv ^m l IS srr.i.s introduced that reduced the cute cycle required for the priming of* sheet-moldine compound by 50 per cent. Auto manufacturer* could increase their production output by using GlasClad-treated. and after 1986, PcrmaClad-treated. automotive body parts. The Automotive .Aftermarket Division of the Coatings Croup was another area with strong growth potential. In 1979. it introduced Sunftre, a highly durable acrylic urethane enamel. Sunfire soon gave Sherwin-Williams the lead in the premium automobile refinishing market because it was the first air drying finish that equalled the durability, gloss, and color retention of a factory-baked coating. Later, the division introduced and then refined, a line of Ultra Base 7 acrylic urethane finishes. In 1988. to expand market share in the production shop segment of the industry. SherwinWilliams acquired the assets of Western Automotive Finishes. Inc. a Texas company. Even the Stores Division--long considered a troubled business-- experienced a rebirth in the 1980$. Despite their broader retail service orientation during the 1970s, the stores still mainly served as a distribution network for SherwinWilliams products. "We had that manufacturing mentality. We were going to make what we want to make, and the [stores were) going to find a way to sell it." noted one Consumer Division executive. This attitude altered in the early 1980s, when SherwinWilliams began to change to a ``marketing pull company rather chan a manufacturing push company." One catalyst for change was the newly installed management accounting system, which revealed that the reason the company's paint factories always seemed to be asvash in money was because they were selling to a capcive customer, the Stores Division. Once the charge for working capital and other, tighter financial controls had been installed, the Stores Division began operating in the black for the first rime in its history. Throughout the 1980s, Sherwin-Williams worked to resolve the dilemma of the customer base of the branch stores. Although the do-it-vourself decorator market increased from a quarter of branch store sales in I9~3 to a third in 1981. the remainder ofsales were generated by painting contractors. Although Sherwin-Williams believed that retail sales to do-it-yourselfcustomers were important, it needed to target this market segment more carefully. The company decided to close Decorating World and scale back the other larger decorating centers to full-line paint and wallpaper stores. It introduced new coatings products, such as Super Paint, a premium quality interior and exterior latex that carried a ten-vear warranty. In 1981, the Stores Division began j new multimedia campaign that advised customers to "Ask Sherwin-Williams." The companv also continually rethought its store location strategy, and. in 1983 alone, dosed many branches and opened fifty others in different locations. At the same time, the Stores Division embarked on the biggest single promotion in company history, calling tor a one-million-gallon paint sale, and coining the slogan. "Take Charge: It s Up to Me in '83!" 99 0007-SWP-034561 0007-SWP-000113242 Re t u r n o f t h e Du t c h Bo y In 1981, Sherwin-Williams acquired tire rights to the Dutch Boy name Its trademark, a blonde-haired, blue-eyed character dressed in wooden shoes and wearing blue overalls and cap, had been a symbol of quality since 1907. The first Dutch Boy was created as part ofa series ofadvertising illustrations, the connection with Holland stemming from the worldwide reputation of the Dutch for immaculate, whitewashed buildings. A group of manufacturers looking for a way to blend their numerous local trade names together saw the drawings, and in 1907, commissioned a well-known portrait painter to create an oil impression of the Dutch boy. The original model was Michael E Brady, a 9-year-old Irish youth from New Jersey who played ball in the artist's neighborhood. In later lift, Brady became a famous political cartoonist. Over the years, the Dutch Boy trademark received different facelifts as the company changed advertising agencies and owners. After Sherwin-Williams acquired the Dutch Boy name from the Chicago-based Dutch Boy, Inc, the logo came full-circlc In 1987, it reverted bade to die original design, after research revealed that customers felt it imparted a feeling of quality. The Dutch Boy, 84 yean old in 1991, is one of the most powerful brand names in the United States. i Tht 84-ytar old Dutch Boy's mossy incarnations; 1957(Itfik 1967 (cmttr)t 1907and 1967 (right). 0007-SWP-000113243 Ch a p t e r ~ Re n s iv o m.e is C.i mi ma Another dilemma that impeded Sherwin-Williams's growth in coatinas was the need for more outlets for its paint products, particularly among discounters who were once again clamoring for Sherwin-Williams brands. To resolve this problem, the company developed an ambitious multi-brand production and distribution strategy. It began in [980 by acquiring the well-known Dutch Boy name and painc facilities. Sherwin-Williams intended to offer Dutch Boy to retailers and discounters, while retaining the Sherwin-Williams brands in its own stores. The company also received Dutch Boys Baltimore Paint and Chemical Corporation subsidiary, a Maryland company founded in 1919 chat specialized in traffic paint, together with its paint factories in Baltimore and Los Angeles. By (985, the Dutch Boy investment began to bear fruit. SherwinWilliams sold Dutch Boy to home centers and other mass retailers and sold Dutch BoySuper Kem-Tone to discount chains. Although difficulties arose initially because Dutch Boy had been a dealer brand. Sherwin-Williams removed Dutch Boy from the dealer channel and replaced it with the Marrin-Senour brand. .Alongside its efforts to build the coatings business. Sherwin-Williams began investigating ocher industries with foster growth rates as an appropriate way to diversify. In 1981. Sherwin-Williams was asked to step in as a "white knight" to ward off a takeover attack on Gray Drug, a Cleveland, Ohio chain of drugstores. Alter examining the possibilities, Sherwin-Williams management decided that since drugstores made most oftheir money in the foil and winter months, this business might be the ideal countercyclical diversification for which they had been searching. SherwinWilliams bought Gray Drug for million in cash. With this purchase (and with ihe stores from Drug Fair, which Gray had acquired six months earlier) SherwinViiliams created a new Drug Store Division, encompassing some 450 drugstores. Although managements original plan had been to focus on expanding the company, based on die coatings and chemicals businesses, and to acquire other, high-growth li nes. it came to realize due some of its unprofitable lines would have to be divested. The Container Division, for example, came under special scrutiny after the new financial controls, and the strategic planning process, revealed that its profits were illusory. Sherwin-Williams had produced containers since 1874 and was still making round paint cans, as well as aerosol and oblong cans, primarily for external sale. Making cans was a big business. In fact, noc counting companies making food and beverage cans. Sherwin-Williams was one of the largest producers of general-line cans in the country, in order to keep profits up, however, it charged Sherwin-Williams's internal businesses more for cans than it would cost the company could buy elsewhere. In addition, the division sold 7? percent of its can output to competing paint companies, in 1984. therefore. Sherwin-Williams divested the Container Division, but continued buying the cans from the new owner. 101 0007-SWP-034563 0007-SWP-000113244 0007-SWP-000113245 f~HATTER Rts is Similarly, although the company hail initially considered the chemical industry a prime area lor future diversification, the Chemical Division's continued losses in the early 1980s made it ripe for divestiture. In 1983, when the federal government extended its saccharine ban, Sherwin-Williams realized it would need to devise alternative artificial sweeteners to remain competitive. Not only did the division lack the research resources requited for this particular purpose, it also lacked the funds to develop other new chemical products, (n addition, the cyclical nature of the chemical business was a problem. Discussions concerning the Chemical Division's long-term viability led to its divestiture, in 1985. to PMC Specialties Group. By the sale. Sherwin-Williams automatically removed itself from a number of businesses, including paracresol. alkali-blue pigments, saccharin, triazoles, and zinc oxide. Sherwin-Williams also reached a turning point with the Dnig Store Division it had formed in 1981. as this continued to report profits below the company's threshold of acceptability. Although the company had invested an enormous amount of management time in che Drug Store Division, and led it through a number of important reorganizations, research in the mid-1980s showed that the division would require another 5300 million to make it into an important presence in the drug store industry. "We got the drug store business from losing money to making money," noted Commes, but this was only "a moral victory as opposed to a real economic victory." Rather than continue to invest, in 1987 Sherwin-Williams sold the division, for a profit, to the Rite-Aid chain. The sale of the Drug Store Division ushered in che third and current stage of the Breen eta. in which Sherwin-Williams, having shed its last non-coatings businesses, concentrated its capital and management resources squarely on coatings. No other company in the coatings industry possessed Sherwin-Williams's remarkable advantages. It as by far the largest, with a vast network ofover 1.000 paint and automotive scores; its nearese competitor, by contrast, had only 380 paint branches. Sherwin-Williams planned to build on these advantages. Its experiences during the 1980s had taught management that efforts to diversify, and to build market share in industries in which the company occupied a minor position, harmed its core business. Top managemenr, which as of 1986 consisted of Commes as president and chief" operating officer, with Breen retaining the chairman and chief executive officer positions, vowed "never again" to divert resources and management attention as the company had done in the 1960s and [970s. In addition to improving ics market share in coatings, Sherwin-Williams focused on improving customer service, and the latter halfof the 1980s saw a significant amount of investment in this area. In keeping with Breens strong interest in employee performance and responsibility. Sherwin-Williams gave special attention to developing 10.! 0007"SWP--034565 I 0007-SWP-000113246 CUPRINOL Shmxitn- Williams s acquisitions in the 1980s and 1990s reflect she company's retstm to coatinp: Krylan. Dupli-Calor, Illinois Bronze, Western, the architectural coatings business ofDeSoto* and the Cuprinol name in stains. CotorWorks fUjUIESTERfl; \&y Automotive Finishes j I ILLINOIS BRONZE * 0007-SWP-034566 0007-SWP-000113247 (. H \P I tR " Mj o a .m f i \ ^ O i f :\(;> its staff from within the organization. The company muiaced a number of programs designed to build management depth and develop the company < future leadership. A formal management Training program for store managers was implemented, and mam- other areas of the company became increasingly professionalized. Breen, w ho often spent half a day with each class of new trainees, believed these training and development programs were essential: his oft-quoted "Breenism ' was "smart people plus hard work equals success." As part of its new emphasis on coatings, Sherwin-Williams took a scries of important steps in product development, production, and distribution. In tyS-, over 100 new stores were opened and many new sates representatives were hired. In 1988. for the first time in n years. Sherwin-Williams updated its color system, introducing the "Color Answers Chart." a state-of-the-art reference of colors for interior and exterior use. More significantly, there was a renewed commitment to quality throughout the organization. The company also made important acquisitions in coating companies with strong niche posirions. Building on its 1984 acquisition of Oupli-Color. a coatings company that specialized in automobile aftermarket paints, in 1990. Sherwin-Williams bought the Krvion and Illinois Bronze aerosol paint operations of Borden. Inc. The Krylon name came from a 41-year old Pennsylvania company that carried a complete line of spray paints and acrylic coatings. The Illinois Bronze Paint Company name was that of a century-old. Chicago manufacturer ofaerosol and oilbased brushing paints. That same year. Sherwin-Williams also bought the architectural coatings business of DeSoto. Inc. An Illinois company which triced its roots back to 1910. DeSoto was one ofthe largest paim manufacturers in che country and its architectural coatings business supplied private label paints for chains such as Sears and Home Depot. The addition of DeSoto to the Custom Paint Products Group made Sherwin-Williams the worlds largest supplier of custom paints for the private-label market. Continuing its focus on coatings, in 1991 Sherwin-Williams purchased the Cuprinol brand name of premium stains, liquid sealers, and other coatings products from the Darworth Company ofConnecticut. The company's decision to concentrate on building market share in ihc coatings industry was timely. Discount and home decorating chains that catered to the do-it-yourself market had grown to become the biggest sellers of paint. These stores preferred to rely on one or cwo major suppliers that sold national brands and provided national distribution, rather than hundreds of smaller, local paint companies. As it pauses to observe the 124th anniversary of irs founders entry into the paint business, Sherwin-Williams seeks to increase its lead in the coatings induct rv .As Breen has pointed out. "Our mission is to be number one in every business we're in." The company's multi-brand strategy of placing its paint and other coatings in as many different channels of distribution as possible gives it a good chance to succeed. iOS 0007-SWP-034567 0007-SWP-000113248 0007-SWP-000113249 Ch a p t eh Re n a is s a n c e in Co s t in g s indeed, tor the first time since it introduced Kem-Tone in 1941* its many brands jre dearlv positioned in the marketplace. Similarly, in its automotive aftermarket and chemical coatings businesses, the company's varied brands are channeled among different markets and cover a wide variety ofuses. By using a strategy ofdeveloping its coatings business more (ully and creating for itselfa larger position as a marketer of doit-yourself products. Sherwin-Williams is ideally positioned for future growth. Although much about Sherwin-Williams has changed over the past m years, much remains the same. The company continues to lead rhe paint industry, and its current strategy, to focus on quality coatings, harks back to its founders. In addition, with Breen setting the tone, the company has re-emphasized its early traditions of honesty, integrity of dealing, hard work, and fiscal conservatism; Cottingham's "Code of Principles' is prominently displayed throughout the offices oftop management. In 1991. Sherwin-Williams is one ofa small handful of United States companies to lead its chosen industry for more than a century. During che past decade, the company has shown steady growth and profitability. Looking ahead, it expects to continue to grow its market share and to improve customer service. Ifits history is any guide. Sherwin-Williams's successful combination of traditional strengths and values, and its modem management techniques, promise that it will remain "Americas Paint Company' for a long time to come. 107 0007-SWP-034569 0007-SWP-000113250 0007-SWP-000113251 Ab o u t t h e a u t h o r s Kathleen McDermott is a principal in The Winthrop Croup, Inc., a Cambridge. Massachusetts firm specialiting in historically-based consulting to business and government. She holds a graduate degree in legal history trom Harvard Law School jnd is the co-author of Aci-ounriHgfor Success: A Hiitem 0f Price VTacerhouse in America 1390-i990(iorthcommgl. Davis Dyer is managing director of the Winthrop Croup. He holds a Ph.D. in history from Harvard University and is author or co-author of rnany books and articles, including Labors ofa Modem Hercules. The Evolution ofa Chemical Company I Boston, 1990). Ac k n o w l e d g me n t s In the trail of 1990. Sherwin-Williamscommissioned the Winthrop Croup to write this book for the company's 125th anniversary in 1991. .Although Sherwin-Williams provided support and encouragement for the project, and the authors met periodically with che company's officers and representatives to review progress, the general structure of the book, its interpretations, and conclusions are the authors' own. Many people contributed to the production of this book. The authors w ish first to thank Patricia S. Eldredge. archivist at Sherwin-Williams for her strong interest in. and support of. the project. Pat's infectious enthusiasm tor the company's history helped to launch this book. Once the work got underway, her encyclopedic knowledge of Sherwin-Williams, her dedication to the project, and her attention to detail proved invaluable. Other Sherwin-Williams employees and retirees also provided significant encouragement and support. Tom Kroeger was a helpful guide to the interviews and an astute critic of the manuscript. Sally Magovich arranged most of the interviews. No matter how obscure the document request. Harold .Molden and his crew in the Records Center always assisted cheerfully. The following people--all of w hom were unfailingly patienr and cooperative-- were interv iewed for this project: Frank Butler, jack Breen. .Allan Childs. Tom Commes. Bill Eldredge. Conwav Ivy. Jim Johnson. .Art .Maine. Tom Miklich. Bill Moonan. Larry Pitorak. Jerry Pontius. Fred Ristow. Walter Spencer. Bob Twhannen. Lcn Ward, and John Weaver. The authors' colleagues at the Winthrop Croup. Paul Barnhill and Dan Jacoby, helped to track down information on Sherwin-Williams in the public domain. Susan Surapine and Pam Bracken provided prompt and accurate transcripdons of taped interviews. This book was designed by Judy Kohn. founding partner of the Eloscon-based firm Kohn.Cruikshank. .Among her credits is the prize-winning history. .-I Delicate Experiment: Harvard Business School. 1908-1945 iBoston. 198 ). The colors that appear on the left-hand pages of this book are evocative of a Sherwin-Williams color chan. 109 0007--SWP-034571 0007-SWP-000113252 No t e u v $u i;r c :e > Shcnvin-Wiilijms has jiwuy* Keen proud f its hi'turv. and its various historians .mJ archivists have proerved a wealth of mjtcrijl Emm rhe vjrly years. '[ his book would have been Ear harder ro produce;, for example, u ithout die efforts of people like VT. R. .Stephen, an early manager who carhered many documents over rhe course of hi* career and wrote Jewripriom ot'.dl facets of Shersvin-^X'dliams history. This book is based primarilv upon internal sources, upon nurenal in the public record, and upon rhe oral interviews noted above char were conducted for this project. Unless otherwise noted, all quorarions and citations from the text are drawn from internal sources at Shenvin-NX'dliarm. As these documents are proprter.m to rhe company, we have not loornored them tor this volume, and cite only references from sources available ro the public. Orations from published or public sources Pa^e ,T)r . .would pass for a Pilgrim father.* from Rov Rutherford. 'lay v>t Living and forking Fill Typical American's Lite.'* in 8ovs (Irntyu f.tll: A Story uf .Twrm'.r# fmtMtrtr. (.fneUniiPl.un Ot-.i/mtCIc'-cland, I'Ma). p, Page "didn't always do what's expected. Uvmteul Week (April I. p. (01 Page "^C'e weren't going out and asking our customers.. Bw'nmi VLVri'iFchrujrvd.T p. VM. Page 'a price had ti> be paid . Bitiiitm March 2". I'T'S'. p. -t.L Page 8*: `from a traditional..." W,ill Street fr.imvnpMjune 24. 1^"h i. p..^ai. Page 8~: `a troubled company.' Street Tnnih ripri)\inc 28. I WUt, p. Page8": " rhe job it no longer jny hin. ' -Ve/i' York Timet -'August }. p. Dl. PaelM: I don't km>w a Jamn thing about the p unt business. Fm.ina.ti H'Ij rid 'August l1!. PWflt. p. 2*#. Pane 10.': ~Our mission is - -.~ Btuineti Week <Mav v ll)86t. p. ^ j j j j | , j j j , J : J 0007-SWP-034572 1 \ i 0007-SWP-000113253 Ame r ic a 's Pa in t Co mp an y : \ HISTl'RY Of SHfcR*1V*>X'll 11 \\N Composed on a Macintosh Computer in Adobe Ganmond with display lino :ti Adobe Helvetica Condenwd Black Primed on Warren Lustre Oitsst l *nv! text and cover papers, by Meridian Priming. East Cr<vn\\i*h. Ut A limited edition was bound m Brilliant* Cloth by The Riverside Croup. Rochoter. M 10 1 ! t * 0007-SWP-034573 0007-SWP-000113254