Righting the ship, Glen Taylor repositions, grows companyPublished 9:42am Friday, December 7, 2012
By Tim Krohn, Mankato Free Press
NORTH MANKATO — Since resuming his role at the helm of Taylor Corp. two years ago, Glen Taylor has revitalized a far-flung corporation that is one of the largest privately held companies in the nation.
He’s building a new leadership team that has turned the company around in sales and profits and, he believes, will be able to lead Taylor Corp. as he eases out of day-to-day operations with the eventual plan to have the company operated largely by foundations that can use profits for charitable endeavors.
But for now, the 71-year-old who initially planned to return as CEO for one year is clearly relishing the art of the deal and doing what he spent most of his career doing — finding new customers, out-maneuvering the competition and looking for new ventures, even in a down economy.
“We’re not relying on the economy picking up. We’re focusing on new products and new customers,” said Taylor during an interview in his office at the upper North Mankato corporate headquarters — an office where virtually every flat surface is piled with paperwork.
“We’ll make it tough on some of our competitors. As a private company we can move fast. And we have money in the bank.”
Still a printer — sort of
Through most of its history, Taylor Corp. was easy to categorize as a printer. Large presses turning out wedding invitations, business cards, greeting cards and letterhead provided the foundation of the company.
“We’re still a printer, but we’re so much more diverse with technology,” Taylor said.
“When we make a sales call, we don’t lead with printing.”
Instead Taylor Corp. offers a variety of technology that allows companies to track everything they do, track all their products, track sales calls, find ways to be more efficient.
“Then we tell them, ‘and we can do all your printing.’”
The company now employs 600 technical people who write software for a variety of business applications.
The need to refocus and expand the Taylor Corp. holdings is what brought Taylor back as CEO in 2010.
At the time, Taylor’s daughter, Jean Taylor, had been CEO since 2007. She’d been an executive with Taylor Corp. since 1994. She left the company when Glen Taylor came back.
At the time of her departure, the Star Tribune reported of a power struggle within the corporation. A female HR executive, who left Taylor Corp. at the same time, was quoted as saying three top male executives had sought to oust her and scale back Jean Taylor’s role.
While Taylor hasn’t discussed details of the turbulent times, he’s blunt about the problems he found with the company and management team two years ago.
“In 2008 when the economy went bad, it affected us as a corporation. It was a double whammy as other technology hit printing hard,” Taylor said.
Print industry sales nationwide fell 22 percent from the pre-recession peak.
Most of the top management who’d grown the company alongside Taylor were retired and Jean Taylor led a relatively young and untested management team.
“The young managers only lived through the good times and didn’t have the experience in what to do when you didn’t have growth,” he said.
“They responded mostly by saying, ‘Where do we cut back?’ What I saw at Taylor Corp., it had become the norm. All the meetings were about how sales were down and what do we do. There was an attitude that if business is down somewhere, let’s close it.
“My attitude was always, what else can we make there, how can we change?”
Many Taylor divisions have found new customers but still do printing. Corporate Graphics, once a local job shop, now also prints children’s books sold worldwide.
And Corporate Graphics Commercial has added high-tech equipment to print a variety of flexible packaging material such as stand-up pouches used to hold juice drinks and other food items.
The company has also moved into a number of products and services it wasn’t involved in before.
For banks and other financial institutions, Taylor Corp. developed software that minutely tracks all of the required information institutions must send to customers. If, for example, a bank needs to show regulators it properly sent certain notices to all its customers, the Taylor Corp. software provides instant and detailed verification of everyone it went to and when.
The company also provides the myriad printed booklets and information those financial institutions need.
And if you buy a refrigerator or TV, it might be a Taylor Corp. division that printed the booklet, mailed you a warranty card and sent you email confirmations of the transactions.
“We also do a lot of work with companies’ marketing people. We do extensive tests and responses on what they’re doing now and show them how they can increase sales.”
Taylor has also been methodically building a diverse leadership team with a range of experiences in different industries to keep the company growing long after he leaves as CEO. That includes promoting from within and hiring talent that is drawn to the revitalized company.
Taylor is also prepared for the future transition of the company — of which he reportedly owns some nearly 90 percent. Rather than have the company sold in whole or pieces, a group of foundations and trusts will keep the company together and growing.
The framework, Taylor said, is designed to still give future management teams enough flexibility to make the business decisions they need to.
That certainty of the future is important, he said, as the company recruits employees and managers. “If you have someone in their 40s thinking about coming on board, they don’t want to wonder what’s going to happen to the company if something happens to me.”
The farmer within
This fall, Taylor and his wife, Becky Mulvihill, went to Iowa, crawled into a massive John Deere combine and harvested corn for three long days.
“I have a soft spot for farming. Our land in Iowa and Minnesota had good crops this year.”
Several years ago Taylor expanded his business interests into agriculture in a big way. He owns several thousand acres of land in Minnesota and Iowa, owns chicken operations, mostly in Iowa, that produce 12 million eggs per day, and more recently bought hog operations in southern Minnesota.
He operates some of his farmland in partnership with other farmers and his son oversees the farming of 7,000 acres of land they farm in Iowa.
Taylor, who grew up on a farm near Comfrey, said the egg business continues to grow and change.
Rather than sell eggs in the shell for grocery stores, the operations ship out tanker trucks full of liquid eggs, egg whites or yolks for a variety of uses by food customers.
“Sales are up every year. Bigger and more sophisticated companies are becoming customers — customers from Europe and Asia.
The company also is working on cage-free chicken operations.
“Customers want it but it’s more expensive,” he said of the move toward cage-free.
The Minnesota hog operations raise 30,000 hogs at a time. The hog industry has hit a recent tough patch due to high feed costs, he said, but the businesses are doing well.
Helping people to hear
In 2006, Taylor bought 15 percent of an emerging but cash-strapped Minnesota company called Envoy Medical Corp. He and other investors have since poured millions into developing and now marketing an implantable device to help people with moderate to severe hearing loss.
Unlike hearing aids, the company’s Esteem device is implanted in the ear. The only device of its kind, it also differs from cochlear implants that are implanted in the inner ear of profoundly deaf people. The Esteem is implanted in the middle ear for moderate to severe hearing loss.
Envoy spent more than 15 years and well over $100 million developing the device and in 2010 the FDA gave its approval.
“We’re selling it, but we still need to get volume of sales up for it to pay for itself,” said Taylor, who is on the company’s board of directors.
“We’ve done 900 people, but we need more doctors to do it and distribute it more broadly.”
Besides getting more doctors to embrace the technology, Taylor said getting health insurance to cover part of the cost for patients is imperative for long-term success for Envoy.
“It costs $30,000. People who can afford it do it.”
Because the device is new, Taylor said insurers have been reluctant to cover it, but he hopes that changes as the device’s benefits are recognized.
“The cochlear implant is more expensive and insurance covers that,” Taylor said.
The Esteem device treats conductive and/or sensorineural hearing loss. In normal hearing, sound causes the ear drum to vibrate, moving fluid inside the cochlea, prompting tiny hairs to touch nerve endings, which converts the movement into electric signals sent to the brain.
In conductive hearing loss, sound moving through outer and middle ear is blocked. The more severe sensorineural hearing loss happens when the hairs don’t vibrate properly.
Hearing aids, which amplify sound, don’t effectively filter out unwanted noise.
And unlike many cochlear implants, which still require patients to wear external components, the Esteem device is entirely implanted in the ear.
In simple terms, the Esteem device works by a sensor picking up vibrations from the ear drum, converting them into electronic signals, cleaning up and boosting the signal and converting the signals back into a vibration transmitted into the cochlea.
Patients can control the device with a remote control and adjust volume and other settings.
While Taylor is comfortable the team he is building at Taylor Corp. will be able to move the company forward if something happens to him, his Timberwolves NBA team is a different matter.
“The Timberwolves are different. The NBA needs someone running it if something happens to me. I thought I needed to find someone to be a limited partner and eventually buy me out.”
Taylor is the biggest reason the Timberwolves are still in Minnesota, having saved the team from moving to New Orleans when he bought the franchise in 1994.
Taylor said selling the team would be no problem, but he wants to bring in a partner and eventual owner who will keep the team in Minnesota.
He’s in no rush to sell the team and has not set a timetable.
“I have parties interested, but it’s a complicated process.”
Taylor believes the groundwork has been done to maintain a successful franchise in Minnesota.
As chairman of the NBA’s Board of Governors, Taylor helped negotiate a new collective bargaining agreement with NBA players that cover the next 10 years.
And, as part of the Vikings stadium bill, the Timberwolves home arena — Target Center — will get a massive renovation.