RBBI Coverage of David Jones Named as OMC CEO and President

RBBI Coverage of David Jones
Named CEO & President
25 Sept. 1997

Before I start this report, I want to enter a couple dates for reference.

Does anybody out there still think this is a slow moving industry?

OMC has been through nerve racking turmoil and excitement with changes of the industry itself in recent months (Toyota's entry into the industry and their later announcement of a ski boat for the U.S. market, Mercury Marine's new president, and pressures to meet new emission regulations). Add to this their own financial difficulties, developing a relationship with Suzuki, thinking Detroit Diesel bought them, Greenway enters the picture, and Greenway finally wins the bidding war. Now they are setting up their equipment at the largest boating show of all time, IMTEC 97. Thursday morning (opening day) rumors hit the floor their current president (Mr. Bowman) has been fired, canned, or resigned (pick a rumor). Now we hear there is going to be a special meeting off site at the Hilton Towers at 6pm Thursday night. I inquired at the OMC booth which confirmed the meeting time and place. They said I would need would be my IMTEC press badge to enter.

IMTEC had some busses making regular runs dropping people off at the various hotels and I caught a ride on one of them. I arrived at the Hilton on the west side of Michigan Avenue about 5:30pm. A large sign pointed to the left (south) and up some steps to the second floor balcony where people had been gathering for dealer meetings in other rooms. I went up the steps and the atmosphere felt like a funeral. People were quietly talking and visiting with old friends.

Several hundred people were milling around just north of the grand ballroom. I inquired at a nearby registration table and was told I would need a special OMC badge. They would happily issue me one due to my press pass. I was to fill out a form and the badge would be printed in 10 to 15 minutes. I filled out the form, submitted it, and began to wait for my badge. The area at the counter was fairly crowded and several hundred people were over closer to the ballroom. I tried to find some "breathing space" between the two groups and people and saw a "name tag from the past." Charlie Strang the inventor of the stern drive and a major figure at several companies in the recreational boating industry was there. As a big time stern drive history buff and I asked him if I could shoot his photo. He agreed and posed with another gentleman as I got my camera and mono-pod setup. I took their photo and we visited a few minutes. He was very cordial, seemed to be very fit and was enjoying visiting with his many friends in the industry. One of our readers identified the other gentleman as Edgar Rose, past head of Engineering at OMC's Waukegan IL facility and it was later verified by OMC. Thanks for the help!

Edgar Rose on the left and Charlie Strang on the right
Copyright 1997 Polson Enterprises
click on the image for a large photo

I returned to the table to check on my badge and found quite a bit of confusion. They were giving up on being able to issue badges to everyone before the meeting was to begin. They announced that badges would not be required and everyone would be allowed in.

I made my way to toward the grand ballroom, which was still closed. I began to be part of a huge group of people all pressing forward toward the ballroom. It felt like we were trying to rush the gates at a concert or a football game. Not really that anybody was in danger - just that hundreds wanted to get in and get the best seats. There was a narrow hall running east to west between the ballroom and the balcony area to the north of the ballroom. The ballroom extended quite a bit further west than the balcony area. This narrow hallway had perhaps 3 wide archway entries open to the north that allowed you to enter the hallway and then the hallway had many more doors along its south side to allow you to enter the ballroom. The ballroom doors were all opened at once and those waiting in the hallway rushed in. The rest of us were sucked through the outer 3 doors into the hallway and could see through some of the doors into the ballroom. The front of the ballroom was filling up (looked like thousands of chairs had been set up). We began to move to the west down the hallway and I went in the ballroom perhaps 2/3 of the way back. The ballroom was very long. One aisle ran down the middle (east to west). I found a seat on the north half bordering the center aisle so I could get my camera out into the aisle. The ballroom was over 3/4ths full. I would make an attendance estimate of 1500 people. Very few seats were empty until you got to the very back. The attendees were 99% OMC dealers and company personnel and 1 % press representatives.

Below are my notes of the presentation:

The meeting began with Alfred "Al" Kingsley of Greenway saying that Hank Bowman had resigned today and he was the new Chairman of the Board. The company will remain OMC. Greenway will not break it up. He said, "More specifically, we're in the engine and the boat business." We will build it and remain long term.

We are profit and performance oriented.

Ficht will beat the competition.

Their will be incentives for performance.

He introduced a few people. I am not certain of the spelling of these names.

Clark Catoolie president of the boat group was introduced and said a few words.

No more uncertainty. We are in the boat business.

First we will focus on engineering.. We have new designs for 1999 and 2000. We will be building new technology into the boats.

Leasing will be introduced at boat shows this year.

We will have demo rides, fishing schools, dealer events, customer events.

First is quality (RBBI note, I guess they can have two firsts if they want too). They now have over 365 corrective action teams.

Second is efficiency. They will leverage the buying power of the boat brands that sell 50,000 boats a year.

More local control, focus on people.

Yesterday a guest speaker, the number 3 man at Harley Davidson, spoke on the P's of doing business. The traditional 4 P's (product, price, promotion, place) and added the 5th P (People). The 5th P was the most impressive. Harley's people are planning and implementing together. Their rebirth is due to their people.

Paul Rabe, VP of the power group came up and said a few words.

We will be continuing our relationship with Suzuki

Continuing to be active with Volvo in the stern drive unit.

OMC had the option to pick Ficht or other technologies and picked Ficht.

"Al" took over the program again.

He said they would show a video and we should stay in our seats. Afterwards their would be an announcement and refreshments.

An upbeat video resembling a "MTV music video" was shown based on the song, "Your Still the One." It had obviously been put together in the last few days (or hours) and was a collection of advertising and promo clips that showed a number of the major accomplishments and awards won by OMC. The slogan, "Priority One Performance," was frequently used in the video. The video was very well done for the little time they had to work on it. Reflecting on it, I recall President Regan's promoters using the "Proud to Be an American" music video at the republican convention to stir the crowds emotions.

Now "Al" began the announcement. He said they had found an energetic team at OMC that with the right leadership will bring them back to first place in the industry. The Johnson family would like that. He will now do a "David Letterman" and go offstage a minute to go get their new leader. He returned with David Jones. Someone in the very back of the ballroom yelled, "Way-ta-go David". Then "Al" introduced him.

RBBI Comments - it was real quiet during the announcement. When he brought David Jones to the podium the OMC Dealers did not recognize him. When he was introduced the whispers all around me were, "Isn't he with Mercury?" I thought about half of them were going to have a heart attack. For real - if they ever do this again, they need some paramedics there. After his introduction, David Jones spoke for a few minutes. I think the crowd was in such a shock that nobody knew what he said. My notes are below.

David Jones talk:

What is the most important think we have to have? Attitude - Attitude - Attitude!!!

Now we will determine what we will do. What are we in business for? How many of you are selling engines? (some hands go up)?

How many sell boats? (some hands go up)

How many sell fun? (some hands go up). That's what we're in business for.

Everything that they associate doing business with us is fun!

What do we sell? (about 3 people weakly said fun)

What do we sell? (maybe 8 in one small area said fun)

What do we sell? (maybe 30 people out of 1500 said "fun", I'm thinking, "give it up David", he finally stopped trying to get them to yell, "fun.")

Many changes are coming.

They will strengthen our financial position.

First, learn to serve our customers in a way that makes them come back.
RBBI comment - seem to be lots of "firsts" tonight

We've got to work together.

I have a reputation for an open door policy.

He invited everybody to the rear for cocktails.

David Jones at right
Stepping off stage after announcement
David Jones at lower right
at base of stage after announcement
Photos are Copyright 1997 Polson Enterprises
click on the images to view large photos

The major players stayed up front for some press photos and interviews. I was listening as Mr. Gibson (Wall Street Journal) was interviewing Mr. Kingsley and someone was explaining to "Al" how you could tell if the recorder was "off" or "on" and if you were "off" or "on" the record. I thought it was kind of humorous.

Quite rapidly, the conversation went to, "When did you first start to court David Jones for the position?" - no response from Mr. Kingsley

"A couple weeks ago?" - Mr. Kingsley said, "I don't remember."

"Within the last few days?" - Mr. Kingsley said something like, "I can't remember, I've been real busy and things have been moving real fast. I'm not sure."

RBBI comment to everybody who really thinks he can't remember, I have some ocean front property in Arizona for sale.

As it was breaking up, I spoke to David Jones a minute (he knows me as a familiar face from my prior job at MerCruiser) and congratulated him on his new job. He seemed very happy.

RBBI Overall Impressions and Comments

Mr. Kingsley ("Al") reminded me of W.C. Fields. He somewhat resembles him and plays the "high-roller" very well. I think they would both like being compared to each other.

Some of those reluctant to endorse the Greenway team during the bidding war mentioned Greenway's lack of marine management experience. The acquisition of David Jones puts a real feather in Greenway's cap. He's a proven leader with a great deal of experience and contacts in the industry.

When he was introduced, my first thoughts were - what about all the agreements Mercury made us peons sign saying we would wait several years before going to work for the competition? Over the last few years several high profile Mercury and Brunswick leaders have jumped straight to other marine companies. Greenway has already filed a suit against Brunswick to obtain a ruling on the hiring against the Trade Secrets Law.

See our Industry Lawsuits Settled Over David Jones and Trade Secrets Page.

My next thoughts were of the Kiekhaefer days. When he fired people or heard they had done something with the competition he immediately changed the locks on their office doors. He escorted them off the property if they were there, and told the guards to keep them off the property. I was wondering if Brunswick would think to lock his office, impound his computer, cut his name off the computer access list, take his Mercury Badge off the entry lists, kill his voice mail, kill his credit cards, kill his phone card, remove his jet access, alert the guards, etc. to remove all possibilities of additional "leakage." I doubt they will. I wonder if they can find some interesting e-mail somewhere from the last few weeks? Maybe some phone records?

Then I began to wonder if a several of the assistant coaches would follow the head coach to his new team? It's quite common in football and seemed like it might happen here. Time will tell. I would think that most would wait until the Trade Secret problems were laid to rest or they might become "a man without a country."

Mr. Bowman (ex-president) was placed on a one year consulting agreement with OMC. This might have been a better approach for Brunswick to have taken with David Jones when he was removed from the helm?

Historically, when major executives are replaced the press release says something about them moving to other special assignments, resigning, or deciding to move on to other opportunities. The press release never says they were "fired." Perhaps the outcome of the Greenway lawsuit will change that? Jones claims he was fired.

The press release said:

Mr. Buckley succeeds David D. Jones, Mercury's president since 1989. Mr. Jones will continue to report to Mr. Larson and will focus on a broad set of marine industry initiatives. "David has done an effective job of leading Mercury Marine to its position of market pre-eminence. The application of his experience will significantly contribute to Brunswick's efforts to sustain long-term growth in a broad array of products for the marine industry," Mr. Larson noted.
Execs may move to being more honest and less face saving in their press releases? I'm certainly not saying David Jones was fired. I assume he was, and their is no shame in that. Many times a new leader can kindle a new fire in the troops and move the company on even further. David Jones is a good leader and did a good job. Head coaches are often fired. The good ones move on to another job, just as he has.

Trade Secrets and David Jones

As Mercury Marine president he was privy to Mercury Marine, MerCruiser, and Quicksilver plans, volumes, etc. Mercury also has a close working relationship with Yamaha which allowed him a good picture of their situation. As a Brunswick VP he was privy to the "goins on" at Bayliner, Sea Ray, Boston Whaler, and the other Brunswick Boating Companies (and Zebco). Don't forget with his Mercury, Mariner, Force, and MerCruiser sales to independent boating companies he has a pretty good idea of what is going on with them also. Mercury was nearing the production of a PWC that just got scrapped (possible connection to his departure?). Now, he is president of OMC. OMC has its own boat companies, supplies some independents, has close working relationships with Suzuki and Volvo. Here is a man that I would say has a pretty good picture of the industry. Wouldn't you?

Additionally, Brunswick, as most large companies, is involved in ongoing litigation. One case deals with its possible monopolistic dealings with its customers. If Brunswick begins to push hard to have David Jones removed from OMC, David Jones might become hostile and threaten to "tell all" in court which might not be a great thing for Brunswick? It seems to me like he is holding some pretty good cards and will probably be able to stay at OMC.


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