Samuel Edwards: HI, I'm Sam. Today is December 1st, 2016 and I'm here with
Paul Millman to talk about the culture of employee-ownership, the structure and
the culture of Chroma Technology Corp. Paul, would you like to talk about
yourself a little bit and what you were doing before you helped start Chroma.
Paul Millman: My name is Paul Millman and I am currently both president and CEO
of Chroma Technology. Before Chroma Technology, I worked for a competing thin
film coatings company where we learned the trade and then he fired me and so it
was my firing that was the catalyst for us starting Chroma. We had discussed the
possibility of starting another company but it had gotten nowhere and weren't
going anywhere with it until he fired me and that catalyzed us and we started
Chroma prior to that. I spent seven years in the restaurant and bar business
00:01:00doing everything from waiting tables and bussing tables to tending bar and
eventually to managing a nightclub in New York which was probably the worst I've
ever had. Prior to that I was a teacher, a school teacher. Well prior to that,
after being a schoolteacher, and before being a bartender again, I was in sales
in the furniture and gift business. And prior to that I was a schoolteacher.
Prior to that I was a graduate student at Antioch (University) New England; and
prior to that I was a bartender; and prior to that I was involved in student
00:02:00politics in the sixties and the underground press.
SE: Ok. How did you come to working with Omega? What attracted you to selling filters?
PM: Absolutely nothing other than the fact that it was a job and I needed a job
and moved to Vermont in May of nineteen eighty-eight and I needed a job and
there were no jobs in the restaurant business, at least none that I could find
that could support a person. And I went to the state of Vermont employment
office in Brattleboro and as I was walking out of the counselor's office, after
he told me that there were no jobs as a bartender, he said, "I see you have
sales experience," and I said, "Uh-huh," and he said, "have you ever sold a
00:03:00product that you thought was worthwhile in terms of the human species?" And I
said, "No," and he said, "Would you like to try," and I said I needed a job. And
so that's how I got the job at Omega. I was not intending to work for an optical
coatings company, I was not intending to get another sales job, but it paid the
bills and although it was a rather low paying job, it allowed me to stay in
Vermont in the summer of nineteen eighty-eight and then at the end of the summer
I decided to stay here and continue that job.
SE: So if you had no experience selling optical filters but some sales
experience, how long did it take you working with Omega to be as proficient as
you were with Omega.
PM: About a year probably.
SE: How much did you add to their sales in the few years that you work for them?
PM: When I started there they had total sales of 1.1 million and when I left
00:04:00they had total sales of 3.35 million.
SE: How many other sales people did you work with?
PM: There were no other salespeople. There was a customer service person who did
who did deal with customers and to the extent that she dealt with customers was
also in sales because I believe that customer services is sales. That person
happens to be the woman that I live with Wendy Cross. So there were the two of us.
SE: Okay, so leading up to getting fired from Omega, what were the tensions,
what was happening in Omega that was, you know, growing those feelings of not
wanting to be there. I know that Dick didn't, wasn't enjoying being there, and
hence resigning after you got fired, but for you, what-- why did you not want to
PM: I never didn't want to work at Omega. It was a job: I thought it was a
pretty, it was, as jobs were in Brattleboro, Vermont in 1990, it was a pretty
decent job. I'd gotten raises; my salary was not wonderful but it was better
than most people in Brattleboro at the time. It certainly allowed me to live
reasonable lifestyle. I wasn't planning on leaving the job until they fired me.
SE: So up until then, what was your relationship with Bob Johnson?
PM: I had an ambiguous relation with Bob Johnson. I think most people do. I
think there was some mutual respect. We periodically work together on projects
but we were not friends. And I think he had some appreciation that my efforts
00:06:00led to greater sales although I don't think he believed that salespeople are
necessary to sell. I think he thought that products sold itself. So it was
somewhat respectful and somewhat aloof, somewhat detached
SE: So when he went to fire you, how did that change your relationship?
PM: He became the enemy, and a target for ridicule and disdain.
SE: So, you know, after you were fired and you guys, you and the other founders
are starting to develop Chroma and the business plan for it, how did you and the
other founders, you know, so you got fired, so how did you and the other members
00:07:00detach from Omega and fully employed, of the six of you, I guess including Lindgren
PM: So, Jay quit, he'd already quit: he was going to travel in North Africa.
Frank also had already quit he was going back to making stained glass. Dick quit
after I got fired. Wendy and Wim stayed working at Omega because we didn't have
any money to pay them and so they stayed working for a while until I believe to
July or August. And then Wendy quit and then Wim finally quit. Rusty was an
00:08:00independent contractor so he didn't have to quit, he just was doing odd jobs for
Omega. I think that's all of us.
SE: What year did you get fired?
SE: Was that the same year that you and the other founders put together
Omega--not Omega, I'm sorry--Chroma?
SE: How long did it take after completing the paperwork to incorporate Chroma to
get your first product made and sold?
PM: Incorporation was in June and I think we shipped the first filters in October.
SE: What was the first couple years of sales and production like?
PM: In numbers? In volume?
SE: However you might describe it.
PM: First, the first fiscal year, which was mostly half a year, our sales were
300 and something thousand dollars. It depends on who you talk to. It was either
318 or 328 thousand dollars. The second year was over one-and-a-half million. It
00:09:00was a very heady time, I mean it was great. We were having a great time. We knew
that we were special: the world told us that we were special. The scientific
community welcomed us with open arms. It was a wonderful time.
SE: When you and the other founders were planning the company did you expect to
gross over million in your second fiscal year?
PM: No, no. Not even vaguely.
SE: In those first two fiscal years who else, did you have to hire anybody else
while you were just beginning?
PM: The first year we hired three additional people in the first year.
SE: I think I wanted to back up actually to get your experience in employee
ownership and then why when forming Chroma that you pushed for it so heavily.
PM: So the first time I heard about employee ownership in those terms was
actually at Omega. Bob Johnson presented the company with the possibility of a
30% ESOP (Employee Stock Ownership Plan) so that means that he was going to sell
thirty percent of the company to an employee stock ownership plan and I had not
heard of this before and the idea of employee ownership immediately struck me as
worthwhile. It didn't strike many of the people at Omega as worthwhile and it
never happened and I think it largely didn't happen because there was no
00:11:00enthusiasm on the employees except for me that I thought was good idea. Employee
ownership fits in with my upbringing and my background and what I believe. I was
born into a family of Communists and I am a socialist and employee ownership was
the most rational way of coming, of bringing socialism to the world. I don't
believe in state socialism, I believe in eployee socialism.
SE: So that naturally informed choosing Chroma to be employee owned.
PM: That made me want Chroma to be employee-owned: it was not even among the--at
that time, the discussion was really among four of us, not all seven of us were
involved: Jay was overseas; Frank was working at home; Wendy was still working
00:12:00at Omega; Wim was still working at Omega, although he was part of the
discussion. So four of us were discussing how to get started, basically, and the
question of ownership logically followed because there were seven of us: who was
to own; who wasn't to own; how they were to own; how to raise money; how to
raise capital to start the company was a big issue. Whether capital should
command ownership was a big issue and I was at least the strongest voice for
employee-ownership in the discussions among the four: Wim, Dick, Rusty and me.
SE: How did they feel about employee-ownership through your argumentation and persuasion?
PM: My memory, and others may have different memories, but my memory was that I
was for it, Rusty was opposed to it; Wim was ambivalent and dick was ambivalent.
Now although I think that it appealed to Dick, I don't think he thought much
about it but I think it appealed to him. I think Wim was more ambivalent about
it. Rusty I believe was opposed to it Rusty, I believe he had access to wealthy
people: I don't know whether they were his parents, or people that he knew, but
I always assumed that it was his parents and they were willing to fund the
company to the, my memory is to the tune of a million dollars but they wanted a
major equity stake in order to do that and I was really opposed to that.
SE: Where did the disagreement continue? Did Rusty end up being part of the company?
PM: Rusty was initially part of the company: he bought shares. Everybody had to
buy shares so shares were a dollar a share, and everybody had to buy at least
1000 shares in order to show the banks and others that we might be borrowing
money from that we were serious and Rusty in fact bought shares. Now most of the
people--Wendy, Frank, Rusty and Dick, I believe--borrowed the money from me to
buy the shares. Jay had his own money I believe and I don't remember whether Wim
borrowed the money or Wim got it from his family but we all bought 1000 shares.
When Rusty left, we bought his shares back at one thousand dollars and then of
00:15:00course it was my thousand dollars so I got the thousand dollars, but no interest.
SE: We can pick up with: how long was Lindgren part of the company?
PM: Maybe six months, maybe less. He did some work, he did some electrical work,
he was an electrical engineer. He wasn't part of the everyday happenings at
Chroma at the time. Of course they were building the equipment, I was not
building the equipment--I was painting walls because they wouldn't let me near
the equipment and so I painted walls and columns and answered the telephone all
at the same time. And we started getting phone calls almost immediately after
opening the doors. But--and Rusty he wasn't-- he must have been there for the
00:16:00entire set-up period where they really completed the evaporation systems because
he would have been integrally involved in making sure that those functions.
SE: And so in the first couple years, maybe even the first decade, what kind of
clients were you working?
PM: We started out working with scientists, mostly biologists, and then we
started working with companies that distributed microscopes and other equipment
to those biologists so they would resell what we made. And then by 1994, we were
working directly with the manufacturers of the microscopes and that was a big
00:17:00deal because they never worked with independent filter makers and in 1994 we
started working directly with Nikon in Japan and that was a very big deal. We
already working with other instrument manufacturers but not the microscope companies.
SE: Were there any are people that you worked or any scientists that were
working on special projects for which you were making lenses for? (Correction: Filters).
PM: The first major customer was the company that was a division of AMICO, the
oil company. They had a division called AMICO Technology and they bought a
license, a technology from the University of California at Lawrence Livermore,
that was, enabled a fluorescent compound to be tagged directly to DNA and by
00:18:00doing that they were able to develop genetic tests that were done on a
microscope. And so that was the first, our first major project and we worked
with through them, we worked with a lab at UCLA of the lab of Dennis Layman who
developed one of the very early targeted drug therapies for breast cancer for
breath cancers that had, that contained the HER2 mutation that was the cause of
the breast cancer. And we were developing a special filter set so that he could
look or the mutation and that was very exciting because I think we made a dozen
00:19:00different filter sets to see if they worked and finally made one that did. Over
the years worked on many projects like that.
SE: So throughout the nineties, Chroma was based out of the, was it the Cotton
Mill down in Brattleboro.
PM: In an old warehouse in Brattleboro and we just kept taking space: we took
space after space after space and finally were everywhere building. And it was
disjointed space, it was disconnected space, it was not clean space, but it was
a lot of space.
SE: Why did the-- the comments you just said, obviously you would want to move
to a place that was clean that was cohesive. What were some of the other
contributing factors to move here to from Brattleboro?
PM: There was no to build in Brattleboro. And Brattleboro Economic Development
people were mostly concerned with helping out another company and they were not
particularly concerned about us until we decided to leave. Then they got
00:20:00concerned about us but the reason we moved up here is because they, Bellows
Falls was very inviting to us and they helped us obtain the space, they help
make this space buildable when it appeared that it wasn't because of rotting
timber about 38 feet below ground. They were very helpful in getting us, getting
this current building built and us moving into it.
SE: What advantages did you get explicitly in this building that--you're had
until now and you're no building an expansion but what advantages did it have explicitly?
PM: This building? It's surely cleaner than the Cotton Mill was and over the
years we've made it even more clean. We made it into a building that has pretty
00:21:00decent workflows, it's a much better place to work than the Cotton Mill was: air
is cleaner, among other things and it's all in one building, it's not in
disjointed space. In the Cotton Mill, we were on three different floors. It was
just crazy to get around.
SE: Up until moving here, Bellows Falls, how many employees did Chroma have?
PM: I believe when we moved to Bellows Falls we had 56, I'm not sure of that. We
can check those numbers. Two numbers stick in my head: 56 and 38. And I'm not
sure which one is the right one.
SE: Was the move up here partly because you had enough employees to need a
PM: We had enough business to need a larger space. We needed more evaporation
00:22:00systems, we need more manufacturing space, we needed more inventory space; we
needed more of everything. We need more office space; we needed and we got and
we've been here since so 2003
SE: So over that first 12 years before he moved up here, with an increasing
employee base, how did employee ownership permeate the culture? How did you see
that play out in every day work?
PM: Well, first we had to figure out how it worked and we contracted with a
consulting company on employer ownership. A company called at that time called
the Industrial Cooperative Association, it has since shortened its name to the
ICA group and they provided different model: we could be a co-op or we could be
00:23:00an employee stock ownership plan or we could make up our own model. The employee
stock ownership plan among other things was too expensive for us. It cost thirty
to fifty thousand dollars to get established and we didn't have that kind of
extra money. Coops were too--our major objection to coops was 'one person, one
share,' 'one share, one vote.' Because we didn't think that it recognized
experience and longevity seniority, so we on the cuff made up our current way of
doing things which is fundamentally a stock bonus plan. In the first at least
three years, we said we will take 4000 shares of Company stock and divide it
00:24:00among the employees and that's what we did the first three years. And then at
some point whether it was year four or year five, I don't remember, we decided
to standardize the number of shares that each employee got and we must have
settled on 200 shares per employee because that's what we do, that's what we
bonus now. Someplace in the recesses of my mind I thought it was 250 at the time.
SE: So for that first decade, before you moved up here, how did you see employee
ownership be part of how people act and people worked in the company?
PM: Oh god, we used to have town meetings to make decisions. And that was, that
was at very least frightening. We used to-- there was a lot more interaction of
00:25:00decision-making, there was a lot more diffuse decision-making there was a lot
more anarchy. So it was, it was, it was--if you had a responsibility to do
something and you had an idea about how to do it you did it and there was no
vetting of ideas. At the same time there were a lot of decisions that nobody
knew about except the people who made the decisions. So there was not as
complete transparency as one might think. You know, decisions have been made
every day and I was spending money on marketing and advertising and sales and
travel nobody ever bothered to ask me what I was doing with it. So it was a
great time of people's involvement but it was also without controls and that was
00:26:00bad. I think we actually-- I can't-- I don't know this for a fact but I do
believe that we got involved in some deals particularly around insurance that
would benefit one person in the company and he did benefit from it and he was
the person who made the deals so I always suspected there was less than
honorable approach to deal making.
SE: As the company grew, how were those decision-making processes changed and
shaped to be more equal or more efficient?
PM: Oh, we tried all sorts of things. We tried a kind of a representative body
where representatives of each of the work groups would get together and they
00:27:00would plan scheduling and they would plan projects. I wasn't on that group so I
don't know what exactly they did. I do know that it became chaotic, it wasn't
always the same representative and I think that they had questions about what
their authority was, what it-- mostly they were involved in production. When
we-- in 1999, oh no, I think maybe it was 2000, the first person left, so the
question was how to buy back her shares. At what value? And that precipitated a
00:28:00major argument, largely between the person who was the company's controller at
the time and me. And it was carried out mostly in emails and the argument was
about how to value the shares and I thought we needed some form of evaluation
that had some relationship to market value. And he argued that shares should be
valued by book value which is how coops are valued and then when we finally got
around to valuing the shares for the first person that left we did value them at
book. And we thought we would continue the discussion and to see if there were
00:29:00other forms evaluation that we wanted to entertain but we never did. The irony
of course is when the person with whom I was having the argument left the
company, he sued to have the evaluation be more than book value. He was not an
honorable person. So when it was not in his interest--when it was in his
interest for shares to be valued at that book, he argued for that. When it was
in interest for shares to be valued at market, he argued for that. I think in
the world that exists in my mind, employee ownership only works if there is
consistency. Not sure I care about what you're consistent about as long as
you're consistent and as long as what you do is in the interests of the greater
00:30:00number of people. Employee ownership doesn't work, I think most things don't
work, but I especially think that employee ownership doesn't work when people
only see their interests. It is in our individual interest, those of us who
founded this company, to sell the company. The company is worth more in a sale
to a venture capitalist then it will ever be in the methodology that we use to
buy back shares whether its book value or ESOP value the value--the value in the
marketplace is probably four times what even an ESOP value is and that makes it
00:31:00probably eight times what our book value is so it is in our interest, those of
us who founded the company and those people who have been here the longest, to
sell the company to somebody who wants to pay us all that money. It is not
right; it is not in the interest of people who want to retain quality jobs that
afford them quality lifestyle; so therefore whenever the issue comes to the
surface, I, although tempted, argue against selling to an outside interest.
There are many reasons why one doesn't want to sell to an outside interest
largely because they end up screwing up the company terribly. Very few
acquisitions that I know of by venture capital companies are private equity
00:32:00companies actually succeed. There have been--we've had a brother and sister
companies in our industry, not the filter industry, but the biotech industry,
have been gobbled up by big companies and most of them are gone at this time.
SE: So in the way that you were describing the difference between self-interest
and collective interest with the founders, how have you seen that collective
interest grow within the employee owner base as the company's grown.
PM: I don't know if it has and I don't know what it's gonna be like when I'm no
here. I one said to a colleague here, younger colleague, that she had to believe
that she wouldn't want to sell the company and she said that, "I can I cannot
00:33:00tell you what I will feel when I have as many shares as you have." And my
response was, "I already have that many shares and I believe that we shouldn't
sell the company." So it's hard to know what people really believe when they're
torn between self-interest and collective interest and maybe we didn't do a good
enough job explaining to people about that, maybe I didn't do a good enough job
transmitting that, that kind of thinking to people. I'm sure that there are many
many many many people at Chroma who feel the way I do but I'm not sure how much,
I'm not sure how much it philosophically goes beyond Chroma. So once I said to a
00:34:00group of employees in a work group, "what if somebody offers a million dollars,"
a hundred million dollars, I'm sorry. And one of them says we should sell. This
is somebody who has been here for I don't know 10 years at the time. So hundred
million dollars was probably worth two million dollars to them, three million
dollars, maybe. I said pointing to one of his co-workers in his work group but
she hasn't been here for as long as you've been here so it's not worth to her
what it's worth to you and he says, "Well we should, we should do something to
make it worth more for her and then sell the company." So there was not the
philosophic underpinnings to his thinking. I don't really know how widespread it
00:35:00is I like to think it's fairly widespread. I do know among the people that I
speak with, it seems to be cherished but I think that I speak with a relatively
small number of people and I don't know what the others think. I'd like to think
that we've created something that is the model for how things ought to be but
it's only a model about how things ought to be if the people who live in this
model would do the same thing if they have the opportunity to start their own
company. So I don't know.
SE: I think that's a good answer. I think that covers a lot of the bases. So I
kind of-- transitioning from employee ownership culture, I want to talk about
how the company structure developed from when it was just the original six
founders you know excluding Lindgren and how developed over the year.
PM: Well it was gradual. Imagine when there were six of us, we all had very
specialized areas of responsibility. When it was customer service, I was sales;
Wim was developing the software that ran the manufacturing systems; Jay was a
specialist of design of coatings; Frank was the guy you went to if you need
something done fast; and Dick had managerial experience at Omega. So we had a
group of specialists and so everybody respected everybody else's domain and
expertise and then. As I alluded to earlier as we started growing, we started
having meetings at which things were discussed and ostensibly decisions were
made but we also made decisions without meetings and individuals made decisions.
00:37:00Right after the attempt--so what I didn't get to in the discussion of the
disagreement between me and the controller was that he actively tried to create
a palace coup and to rid the company of me and he did this in very underhanded
and very secretive ways. He would slither around like a snake and try to gain
allies in this effort. What he did, what he underestimated was the bond between
the six founders. We were not the same kind of people; we live very different
00:38:00lives, but there was a bond among us that was impenetrable and continues to be.
So when challenged the founders stuck together and there was no way that he
could win that vote. So what we did was we said--we had a board of directors
that did not function. I should note that at the first board of directors
meeting, shortly after we found the company, we had to elect officers and I was
not elected president and even Wendy voted against me. Dick was elected
president I became president after that millennium and we were very, very
consciously concerned about authority. We were very unconsciously concerned about
00:39:00authority also and we did not like people who had too much authority and did not
like people with power. We were after all children of the sixties all of us in
some way or another, the early part of the sixties on the late part of the
sixties, and not trusting people over 30 and letting the people decide and one
man, one vote and blah blah blah--all were us and so although-- we had a board
of directors who didn't function but after the attempted coup we decided the
board of directors would function and would be the leadership of the company and
the six founders were made permanent members of the board of directors as long
00:40:00as they were as long as they continue to be full-time employees that they would
be three other members of the Board of Directors voted on by the employee
owners. So the founders retained the majority status on the board. That
precipitated a period where the board was also managing the company and that was
craziness. And as was our history we got another controller--why is it always
controllers--who decided to mount a coup in the company.
SE: A second coup?
PM: A second coup. This time he tried to enlist my support in the coup and he
was going to overthrow Dick as president and institute another founder as
president. Subjectively, I believe his intent was to make that other person
00:41:00president because he felt that he could control that other person. And then at
the meeting where this was all to happen I didn't vote for it. And that caused
him great consternation. He left under a cloud later on but the board was not
the place to manage the company and it never has been. And so in order to create
some kind of management that did not include Jay or me because Jay and I were
the adversaries in some fashion about how the company was to be led. So this--we
00:42:00had to have an organ that didn't include Jay and Paul and we created a steering
committee that had, I believe, seven members, only two of which were full-time
jobs, all the others were had day jobs and worked on the steering committee in
their non-day-job hours and that was crazy. It had the effect of beginning to
show us that management had a place at Chroma but it wasn't fully-fledged management.
SE: When was that committee founded or when was it was it you know actually
making a changes to the company?
PM: I think it was around 2005 or 2006. It may have been 2006. I think--I want
00:43:00to say Dick retired in 2007 and he was a member of the original steering
committee. And then when it became apparent that you couldn't have a day job and
also do this working that we actually needed full-time people to do management
work we created the second generation of the steering committee and it contained
four people: a sales manager, an operations manager and two production managers.
And it moved us forward: it began to show how thought-out decision making in
production would work. Of course, sales was not included in there. Was the sales
00:44:00included? We had operations managers and then--we did have a sales manager but
the culture was that I did sales and so I think there was--ok now sequence, the
original, the original group did not have a sales manager. They wanted the sales
manager. The person that we approach to be sales manager didn't want to be sales
manager so the operations manager became the sales manager and the sales
manager, the one that we wanted for sales became the operations manager. And
that sales manager I got along well, I liked him I thought he was immensely
talented and I thought that he was, had a future at Chroma. He had a hard time
00:45:00concluding decisions and carrying through on them and eventually he left. My
understanding of why he left was that he and his then wife wanted to live out
West and they move to Colorado or something like that. I know he's still around
the industry somewhere, I have not seen him, he was a smart, a very very smart
guy and I think that had he stayed he'd have been an important person in
leadership of the company.
SE: So in directing the role of what the coordinating committee has done in the
past, who or what does that structure look like now? How is the management
PM: Management structure evolved to this year where we have now 5 chiefs, as it
00:46:00were, however we're looking for another term. We have a chief executive officer,
chief financial officer, chief technical officer. These are all positions, not
people, mind you. A chief customer officer and the chief operations officer. We
have three people fulfilling those five roles. That the chief financial officer
and the chief operations officer are filled by one person; the CEO and customer,
chief customer officer are both me; and the chief technical officer is another
person. And we're looking in the not-too-distant future to add to the number of
people we have in most roles so that eventually we actually have five doing five
jobs. And I will retire next year, 2017, or the year after that,2018, and
00:47:00somebody else is going to become CEO and I suspect it will be somebody from that
group and so will have to fill in other places.
SE: So between the chief positions and the work groups themselves, what is the
structure between those two?
PM: There are, at this point two production managers, we will hire a third;
there's an engineering manager; there is an IT manager but that's basically
managing one work group. There will be a quality manager as opposed to a Quality
00:48:00Systems Director. Quality manager is an activist position, it's somebody that
makes sure we do things right instead of just tells us the right way to do
things. I didn't understand this for a very long time but director of quality
systems develops the quality system doesn't mean that person actually makes it happen.
SE: So are both of those positions going to be there or--.
PM: Both of those positions will be there but one will be a superior position
manager, the manager will be the superior position. I think now we also have a
subsidiary and they have an Operations Manager up there; we also have overseas
sales offices and they have general managers there. I suspect we'll continue to
00:49:00develop some additional layers of management but not too many because for the
most part what we really like about Chroma is that the work groups manage
themselves and we think that's real healthy I think it's healthy both for their,
for people's sense of self, it's healthy because people who do the work tend to
make the innovations that make the work easier and better. I don't ever think
we'll have a structure where every department has a foreman or supervisor or
something like that, it just feels uncomfortable.
SE: How does it tie into the culture and experience of being an employee owner
at this company? Or how do you thing it ties in to the experiences of workgroups?
PM: So. many years ago when I was vice president and was in charge of sales and
00:50:00there was, and that was undisputed, I was working late, we were still in
Brattleboro at the Cotton Mill, and there was a thin-films technician who was
making head up, had orders for two different mirrors and he didn't know which
one to make first so I said, "I know the customers, you make that one first
because that customers more important," so he says, "you can't tell me what to
do; I'm an owner here too." So structure affects ownership. We recently had
somebody say when we introduced the c-suite and the structure to date, somebody
said, "Does that mean I have a boss now?" Well they always did, they just didn't
know it. We didn't think it. It changes the way people think, it changes the way
00:51:00they operate. One hope that it changes them in a liberating way so that things
that they shouldn't, don't have to deal with. Things they should have to deal
with, they deal with. There's no guarantee that's how people think.
SE: So we're actually at 51 minutes, are there any final remarks, comments about
the topics we talked about that you want to cover before we finish?
PM: I have a friend who is the CEO of a trust company, local trust company in
Vermont and that trust company is employee owed. Somebody once said to him and
before that he and his entire team has worked as the trust department of a
bank--they all got fired, set up their own company, sounds familiar. And they're
00:52:00incredibly successful but somebody once said to him, "What's the difference
between leading the trust department of a bank and being CEO of an
employee-owned trust company?" And he said, "I have to explain myself more."
Employ ownership is more difficult. It's more difficult for a number of
different kinds of people. It's more difficult for people like me who think they
know the answers. It's more difficult for people who think that they have
technological sophistication that others don't have. These things are true: it
is a more difficult way to do things, it's the right way to do things. There is,
00:53:00he's since died, there is a very, very, very very very large formerly
employee-owned defense contractor in San Diego, the company's called SAIC. And
the man who started the company, Dr. John Byster, got it into his head that it
ought to be an employee-owned company. So he set up one of the most magnificent,
one of the most complex employee owned companies in the world. 10,000
employees-- this is not a hundred thirty. They had an internal stock market
where employees could buy and sell shares and it made his ownership less
valuable. So somebody who I think was probably questioning his sanity as people
have probably questioned mine, said to him one day, "Why did you make this
00:54:00company employee owned?" And he said, "Because it's fair." And that says
everything. John Byster says it better than I could with fewer words than I
would. It's right because it's fair; it's more difficult; it's more complex; it
is sometimes more emotionally draining: but it's always fair.
SE: Thank you very much Paul Millman.
PM: You're welcome.