When the rubber hit the road:
by DAVE BENAK
What happened at CF?
For 33 years, Dave Benak was training director for
Consolidated Freightways in Menlo Park, Calif. Working for seven
different CF presidents, he experienced the best and the worst of
times. With his unique perspective, he offers one man's opinion of
what went wrong.
"Your employment ends immediately" was the
pre-recorded audio taped telephone message to all employees of
Consolidated Freightways on Labor Day, 2002. The message came from
Mr. John P. Brincko, the company's CEO. With that announcement, a
company born and "home-grown" in the Pacific Northwest closed its
doors and locked its gates for the last time, leaving many to wonder
what happened. Consolidated Freightways filed for bankruptcy on
What went wrong? What happened to this
once-proud, 73-year-old company? What created this recipe for
disaster for 15,500 employees and their families?
Was it management, the workers, the economy? Was
it sales, marketing, pricing, the competition or technology? What
were the telltale signs ... months of red ink, employee turnover or
poor morale and bad attitudes? Or, was it a combination of all these
things? When the competition is making money and you're not, you
know that something's wrong.
I personally think the problem was leadership or
the lack thereof. CF had some of the finest managers in the
transportation industry, but sadly, they lacked the corresponding
leadership, or people skills, necessary to maintain their position
among the top three companies in the industry ... an industry they
dominated between 1985 and 1992.
Leadership ... that engine that drives the most
successful and profitable companies today. There is a difference
between management and leadership and, while you need both for
balance, in today's economic turmoil and competitive marketplace,
it's leadership first ... management second. You manage things; you
Many CF managers were unable to "let go" of the
traditional, top-down management philosophy that (ironically) got
them promoted in the first place. With outdated and rigid, top-down
management controls, there was little room for improvement or
long-range (visionary) planning.
Driven by power, control and numbers ... nothing
else mattered. Numbers became the "Holy Grail" of measuring success
... And to get them, you would resort to any means possible including
fear, threats and intimidation. Nobody trusted anybody, and "CYA"
was the mantra heard throughout the company.
When you forget about your employees, you might
as well forget about your customers. The formula for success is
simple Employees + Customers = Profit ... in that order. When you let
titles or positional power, pride and ego enter into the equation,
you create an environment that stifles creativity, teamwork, morale,
attitude and motivation.
The most frustrating part of working for CF was
not being able (or allowed) to do the job that you were hired and
paid to do. The simple fact that nobody would listen to new ideas or
"change" ... if it didn't come from the top, suggestions were simply
ignored. We kept doing the same thing over and over again expecting
different results. We were constantly being pulled off task by
conference calls, meetings, flavor of the month, or quick fix
programs, the "good ole boy" network and political maneuvering. Not
a very healthy situation when you're struggling for survival in an
industry where the profit margin is so slim. We focused on being
reactive instead of being proactive; we were great firefighters but
didn't spend enough time preventing them.
Once known as a company built on pride and
loyalty, CF fell prey to the damaging effects of internal,
self-destruction. You might say that CF collapsed or imploded ...
because they failed to see the need for people skills, change and
new leadership techniques at all levels of the organization. Yes, CF
faced a host of problems, but sadly many of them were of CF's own
making. CF died of a self-inflicted wound far greater than the
economy, competition, the union or any other outside
What's the lesson we can all learn from this?
You simply cannot manage a company to the profit levels necessary to
compete in the 21st century any more than you can generate that
profit on the cost side of the equation. Management and cost control
are only a part of the formula for success. Companies need
leadership, just like they need additional revenue (sales and
growth) to leverage their position and meet their goals.
Yes, leadership does matter. It matters a hell
of a lot. If you work on human capital ... it pays big dividends. Tap
that peak performance or discretionary effort that's locked up the
minds and hearts of your employees.
I challenge every manager in every organization
reading this to answer the bell and move (or shift) to a leadership
mindset. Work on the people side of the ledger. Assume a leadership
role in your organization. The formula is simple: Efficient
Management + Effective Leadership = a Successful Company. And, don't
be afraid to change, try something new, and listen to your employees
for ideas and suggestions that can save you both time and
CF going out of business was a terrible thing
for a lot of the people, but as the saying goes, "Where one door
closes, another opens." I truly believe this since many of the
people I know have already found new jobs where they once again feel
needed and wanted; and, where their contribution and experience is
truly appreciated. Jobs where they are treated with dignity and
respect. Where trust, credibility, integrity and teamwork flourish.
These are the same building blocks that made CF the great company it
once was. The loss of which caused the erosion and ultimate demise
of this $2.3 billion company.
To all those loyal, hard working employees who
helped build this great company, I wish the best of luck.
If you are with a large or small company,
recognize the telltale signs of internal "people problems" ... be an
innovator, not a follower ... trust your people ... be honest with them
... keep the lines of communication open. Invite your employees to
join you on the journey.
Being the best means getting everyone on board
with a clear understanding of where you are, where you are going,
and how you expect to get there. Ask for their help and commitment
to make your organization a success. And, finally, tell them what's
in it for them.
When you're at the head of the herd, it's best
to look back every once in a while and make sure you're still being
followed. Being the best is not a matter of size, geographical
coverage, gross revenue or a long colorful history. Just ask the
employees who worked for CF.
Dave Benak teaches leadership, management
and supervision at Clark College. He owns and operates TrainingPays,
a locally based training and development company. He invites your
comments, concerns and questions at TrainingPays@aol.com or (360)