FLYING INTO THE FUTURE

THE BALTIMORE SUN

Not many people have a letter of reference from a honcho in a Fortune 500-type company that reads like this:

"John Garel is the finest young executive I have ever worked with."

Even fewer who do would jump ship from Northwest Airlines to run a print shop in Baltimore. But his new job is to turn Cadmus Journal Services Inc., the company created last November when Richmond-based Cadmus Communications Corp. bought Waverly Press Inc., the printing arm of Baltimore-based Waverly Inc., into more than a print shop.

The 35-year-old Mr. Garel colors outside of a few lines. He may have left the airline business, but as he introduces himself over the course of an early-morning meeting, it becomes clear that he's out of the mold of airline types like United's Frank Wolf and American's Robert Crandall: He's willing to walk the walk, and not shy about talking the talk.

Just ask him why he left Northwest, where he was in charge of planning the airline's route scheduling and a fair bit of its marketing besides. Three years before that, he left American Airlines, which was so incensed when a dozen executives followed Mr. Garel out the door that American sued Northwest to try to make the Minneapolis carrier stop raiding.

"The big airlines' strategy and prospects for the next 10 years essentially revolve around taking wealth from employees, creditors and owners as a means of survival," he said. "These companies have made themselves dinosaurs. The only questions are how long it takes to go extinct and who's going to pay the price along the way. It just wasn't the kind of thing I wanted to ride through."

Good morning!

"I've been looking for heads of companies for 20 years, and John is an unusual talent," said John Franklin, the headhunter at Russell Reynolds Associates in Washington, who found Mr. Garel for Northwest and who read part of Mr. Garel's reference to a reporter (without telling which "major player in American business" wrote it). "He's not a typical corporate gnome who works his way up glacially. He likes control."

The place where control was available was Cadmus Journal Services, where Mr. Garel became executive vice president in November. The old Waverly unit, and a Virginia division that Cadmus Communications owned before the Waverly deal, print 362 medical and technical journals -- Endocrinology, Pediatrics and Genetics are typical -- with a combined circulation of 46 million.

"I think they're regarded very highly as a strong, heads-up competitor," said Gray Glass, analyst for Wheat First Securities Inc. in Richmond, Va., who follows the parent company, a $200 million-a-year concern whose other main business is financial printing.

Mr. Garel said the Waverly deal will push Cadmus Communications' yearly revenue to between $280 million and $300 million.

"They've proven very adept at acquiring companies and making the acquisitions work for them," Mr. Glass said.

Standing still on the "information highway" is a recipe for getting run over. Mr. Garel said, in essence, that while the 300 Waverly Press workers in Baltimore aren't going to see the dislocation that follows mergers, like cost-cutting layoffs, they are going to see short-term and longer-range changes.

Leaving Baltimore

The company's first move is out of Baltimore, since Mr. Garel's first public decision was to put the new company's headquarters in Anne Arundel County, a deal that so far is 1994's biggest local office transaction. Lower rents and access to Baltimore-Washington International airport were among the reasons. But while city officials said they were taken by surprise when the decision was disclosed last month, Mr. Garel didn't mince words about other reasons why he made the call.

"Safety and security is a clear problem where we are today," Mr. Garel said, speaking about the Dickensian Guilford Avenue plant that Cadmus Journal Services shares with Waverly Inc., which kept the larger publishing division of its business when it sold the printing division to Cadmus.

Waverly Inc. said in December that it plans to move to the old B&O; railroad warehouse behind Oriole Park at Camden Yards. "It's just an unacceptable situation in this part of town," Mr. Garel said.

It might be easy to write off that comment as the words of the country-club suburbanite who lives in a cocoon. But Mr. Garel isn't that simple: He and his wife, an executive at the W. B. Doner advertising agency on Pratt Street, live in the city (at the new HarborView condominium), and he said he plans to be involved in the city's public life through civic activities and creating jobs.

"We never found Minneapolis to be a place where we wanted to get involved in the community. It never felt like home to us," he said. "Here it's both a personal and a professional interest to try to use company resources in the community."

"Cadmus had no incentive to stay in the city," said Wayne Gioioso Jr., president of Mid-Atlantic Properties Inc. in Cockeysville, the brokerage that helped Cadmus choose its quarters. "He said, 'I've got a business decision to make,' and he made it. . . . I told [the city], 'If you've got something to put on the table, John's willing to listen.' And he was."

Still, Cadmus Journal Services is looking at changes more profound than a 20-minute change in the daily commute. First up will be the gradual merger with the William Byrd Journal division, the scientific printing operation Cadmus Communications already had before the Waverly deal. Mr. Garel said that by late 1994, "those two businesses will look like one," though he dances around the question of whether he will run the merged division.

Electronic publishing

Longer-term, the company will have to decide how to adapt to a world where information is available in many more forms than just on the printed page. Mr. Garel said Cadmus is looking into distributing scientific journals on-line, moving into CD-ROM technology and participating in research aimed at developing "the library of the future." One of his next decisions is to find a head of electronic publishing, he said.

"Our business is changing incredibly rapidly. We're not printers. We're in the information integration and management business," said. "People are used to getting their information in certain ways. Changing that takes time." And in the end, an industry where change is moving faster than a 747 on a runway attracted Mr. Garel away from the higher-profile airline business.

"Our business is clearly in the middle of all the rhetoric over the information superhighway," he said. "I wanted to get into a company that would allow me to be a leader in letting quality drive a company. It's not a glamour business compared to airlines, but it's got the people and the process complications, and it's fast-changing. I like an intellectual challenge, and it's

clearly a challenging place to be."

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