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McCormick's quiet new leader


For much of his working life, H. Eugene Blattman, the new chief executive officer of McCormick & Co. Inc., has been stymied in his efforts to create a workplace that encourages worker participation and values individuals.

Even as a top executive in the early 1980s overseeing human resources at the McKesson Corp., a giant San Francisco food and pharmaceutical conglomerate, he was unsuccessful in getting his ideas implemented.

"I thought, here's my chance, we're really going to make this the right kind of company. And I could not get anything accomplished," he said about his efforts at McKesson. "It was extremely frustrating to me."

But Mr. Blattman is frustrated no more.

Now chief executive of the world's largest spice and flavorings company, Mr. Blattman, 58, finds himself at the top of a company where his own values of honesty, hard work and the importance of all workers are mirrored in a corporate philosophy that dates to 1932.

"It was like coming home because I felt so comfortable with the value system," he said.

Mr. Blattman became the company's seventh chief executive officer on July 19 after the death of chairman and chief executive officer Bailey A. Thomas on July 14. Mr. Thomas died after a heart attack.

With his silver-gray hair, the tall, slim Mr. Blattman presents a dignified, lower-key image compared with Mr. Thomas, who was known for his wit and readiness to dress up in costumes to make a point at corporate meetings.

"He's a quiet type," said Thomas S. Haggai, chairman of IGA Inc., an alliance of 4,000 independent grocery stores in six countries.

"There is just a basic integrity," he said about Mr. Blattman. "You could sit down with him and what he tells you, you can make book on it."

Unlike Mr. Thomas, who had worked at McCormick for 33 years, Mr. Blattman's tenure at McCormick, Maryland's third-largest industrial company with $1.6 billion in annual revenues, has been a scant five years, and his presence at its Baltimore County headquarters even less. But Mr. Blattman, who was hand-picked by Mr. Thomas as his successor, said he plans to deviate little from his predecessor's strategy or McCormick's team culture.

The McCormick system, known as both participative management and multiple management, is no passing fad at the Sparks-based company, which has 2,000 workers in Maryland and 8,600 worldwide. For 62 years, the company has maintained a series of "mini-boards," in which employees from all levels study the business and make recommendations. The company pioneered profit-sharing and stock-ownership plans decades before they were fashionable.

And all that fits in with Mr. Blattman's management style.

"He liked to build consensus," said a former colleague of Mr. Blattman at McKesson, who asked that his name not be used. "He's a very bright guy with good management skills, good people skills," he said.

His people-oriented management style, as well as his methodical approach, are reflected in a personal computer file he keeps on people he meets. Filled with tidbits of personal information such as the names of spouses and children, it now numbers about 4,000 people.

Mr. Blattman uses the information to refresh his memory before meetings and gatherings, and often surprises people by asking about family members by name, according to Robert E. Stauth, chairman of Fleming Cos. Inc., an Oklahoma City food distributor and one of McCormick's largest customers.

"He's kind of made it a life study," Mr. Stauth said.

But it is more than just the mechanisms of the company that makes it different, Mr. Blattman said. It goes to its "core values," which include "genuine caring about people, encouraging participation and team work, the customer is king or queen, dealing honestly and ethically," he said. "It's not just getting the numbers. It's how you get the numbers that counts at McCormick," Mr. Blattman said.

And those values, Mr. Blattman added, have paid off for the company. "We're committed to staying an independent company because we think we have something very special here and we think that is in the best interest of stockholders over time," Mr. Blattman said.

Lower profile seen

Similarly, Mr. Blattman supports McCormick's community role but is prone to keep a lower profile than Mr. Thomas.

Last year, the company's 52nd annual Charity Day, in which workers can donate a day's pay -- matched by the company -- to the United Way of Central Maryland, produced $635,000. The company gave $2 million to Baltimore's literacy program in 1989, and shows up on the donor list of numerous area and state organizations.

"They have gotten increasingly involved," said recent Greater Baltimore Committee Chairman Decatur H. Miller, about McCormick. "Bailey believed it was an important role for the company and made that a priority."

Mr. Thomas was the point man for the company's community efforts, serving on the boards of such organizations as the United Way, GBC and Marylanders for Responsive Government. But Mr. Blattman said the company's civic activities, as well as dealings with the financial community, now may fall to Carroll D. Nordhoff, executive vice president and a 25-year McCormick veteran.

"Obviously, I cannot do everything that Bailey was doing and everything I was doing," Mr. Blattman explained. "Carroll is pretty well-known because he has been here for 25 years."

Mr. Blattman traces his management beliefs to his early years as the only child of parents who ran a "mom and pop" store in Kansas City, Mo.

"There was always a big emphasis by both of my parents on working hard, doing your best and being very honest," Mr. Blattman said. "It was just family values."

When he was 16, the family moved to Walla Walla, Wash., where his father became a produce manager of a supermarket. There Mr. Blattman started his own career in the food business, taking a job in a frozen-food factory owned by General Foods.

His dedication to hard work was tested in college, when he juggled studies and was supporting a family. Married at 18 and a father a year later, he went to classes at Whitman College in Walla Walla during the day and worked nights at the General Foods plant.

College a blur

"Those four years were just a blur for me," Mr. Blattman said, adding that he would often sleep between classes or during lunch, averaging three to four hours during weekdays.

It was during this time that he came to appreciate the potential of workers at the lower rungs of the workplace.

"I started sweeping the floors, literally," he said. And from this experience, he decided that there was not much difference between the bottom and the top of a company.

"There are intelligent and motivated people at all levels of the organization," he said. "That's why I believe so strongly in empowering people throughout the organization."

But Mr. Blattman's beliefs about employee empowerment had to wait more than 20 years as he worked his way up the corporate ladder.

After receiving a bachelor's degree in psychology from Whitman, he worked for General Foods until 1965, attaining the title of plant superintendent for the company's Birdseye division. He then spent nine years at Rogers Food, a potato company based in Idaho Falls, Idaho, where he moved up to vice president and general manager of the California Division.

In 1974, he moved to Gentry International, a dehydrated-onion and garlic company in California. He was president when it was acquired by McKesson in 1976.

He finally got his chance to try out his ideas in 1984 when he helped engineer a management buyout of Gentry from McKesson.

Mr. Blattman, who was the new company's largest stockholder as well as the president and chief executive officer, instituted his "team spirit" plan.

"We broke the whole company up into teams and we had a score board in the lunch room, and every month we would put up scores for attendance, production, etc.," Mr. Blattman said. "Then we had points that people got and they had catalogs and then could order products. So we really had a lot of involvement."

The company did so well under these policies, Gentry was bought by its chief competitor, McCormick, at the end of 1987 for an undisclosed amount. It was later folded into McCormick's Gilroy Foods division.

Mr. Blattman said the sale to McCormick, which had its own onion and garlic plant next door to the Gentry plant, just made economic sense. "There was a natural unity there," he said, adding that the sale added stability to the 500 workers at the plant.

After the sale, Mr. Blattman's first thoughts were to retire, but Mr. Thomas, who had become impressed with his management style, had other plans for him.

Moved in 1989

Over the course of the next year, Mr. Thomas continued to urge Mr. Blattman to make the move to McCormick. He took the bait in 1989, taking over the Gilroy operation. Later, he would be put in the line of succession for the top job on Mr. Thomas' recommendation, according to Charles P. "Buzz" McCormick Jr., chairman and chief executive officer before Mr. Thomas.

"I remember him [Mr. Thomas] saying he was a very good one-on-one person," said Mr. McCormick, who returned to the chairman's job following Mr. Thomas's death. "He's bright and sharp and knows what he has to do and is a good leader."

Mr. Blattman impressed McCormick's top management with his performance at Gilroy, where he substantially boosted profit margins, Mr. McCormick said.

"He did a super job at Gilroy Food," he said.

In 1991, Mr. Blattman became vice president-flavor and agribusiness group and moved to Sparks with his wife Virginia. (Mr. Blattman has five grown children from a previous marriage, and his wife two.)

The move east also has allowed him to indulge his passion for the Civil War, which he developed over the last 10 years. He has collected over 150 books on the conflict and amassed a small arsenal of period weapons.

HTC In the last three years he has gone to Gettysburg 10 or 12 times, including this past July 4th holiday. "Moving here to Baltimore was like moving to a candy store," Mr. Blattman said.

He became executive vice president and chief operating officer in 1992 -- normally the third person in succession at McCormick. His next step was to president and COO in January 1993 -- positions that paid him $561,192 in salary and bonus last year.

No resentment

Despite his rapid ascent in the company's hierarchy, Mr. McCormick said he never heard of any resentment from senior managers who have been there longer.

"I think people respect him for what he has been able to do," he said. "We have a team culture and we don't see resentment."

Even with the assistance of Mr. McCormick, who was reappointed chairman on July 19, Mr. Blattman will have a hard act to follow.

In the last six years, the company's operating income has jumped from $35.6 million in 1988 to $99.7 million in 1993. The company's stock price soared, going from less than $5 in 1988 to more than $30 at the end of 1992. But since then, the stock has weakened and has been trading in the low $20s, and the company has been backing off its stated target of 15 percent annual earnings growth.

Mr. Blattman does not expect to repeat such spectacular gains during the coming years. Instead, he expects to see steady growth, with annual income growing at an average of more than 10 percent over the next several years as the company pursues the international expansion strategy begun under Mr. Thomas.

In fact, Mr. Blattman has been a key player in that expansion, which is forging new markets in Europe, Asia and the Pacific, Mr. McCormick said.

"I think we have tremendous growth potential in the future in the Asia/Pacific area," Mr. Blattman said. "And we are positioning ourselves now for that."

"You have consumers that are beginning to get disposable income where they have some real spending power," he said. "Once you get a middle-class developed and they start getting some spending power, you can see some amazing surges as far as their consumption and, of course, we are there to be in the mainstream of what is happening."

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