"Dai Nippon will be totally insulated from their poison pills. Like the
guy who sells his house and boat to his company and then lets it file
Chapter 11 bankruptcy in order to protect his personal assets from
creditors. Nobody can lay a glove on you."
"Mr. Walton"--he leaned back, a twinkle in his dark eyes--"that's exactly
why I knew you were right for us. You have an intuitive grasp of
tactics."
"If you do this, there're going to be a lot of unhappy, unemployed
lawyers in this town."
"Most regrettable. Some of them might even have to go out and find
productive work." He rose and shook my hand. "You've destroyed the
prospect of years of legal roadblocks in a single stroke. It's
elegant."
It was. Sun Tzu and Miyamoto Musashi would definitely have approved.
But there still had to be more. An unexpected opening is not enough in
itself; it needs an equally deft follow-up. Bushido, the Way of the
Sword, teaches that you should first surprise your antagonist, and then
you must confound him. Both the initial attack and the carry-through
are crucial to success. Among other things, that meant Noda's mechanism
for calling a board meeting of the companies he'd be acquiring had to
be instantaneous, without the usual niceties.
"This setup should do the job, but only if it's used with finesse.
Otherwise the whole system gets buried in paperwork."
"What do you mean?"
"You have to be fast, and flexible. Once you've taken ownership of a
company, you've got to gain immediate control over its board of
directors, in order to block any and all countermoves."
"I understand."
"Do you? I'm talking about the ability to call an executive session out
of the blue. The _kesa_ stroke of the sword. The power to cut a CEO in
half before he can blink. No time for consensus and the usual Japanese
niceties."
He stood quietly, thinking. At last he spoke.
"In other words, I must be able to convene the board at a moment's
notice. Is that the essence of what you are saying?"
"Nothing else is going to work."
"Very well. After we have a commanding stock position, we can institute
the necessary changes."
"Good. Remember though, that's still merely half the battle. Besides
being able to call board meetings, you need full authority to institute
a shareholders' vote, which in this case will consist of nothing more
than you signing your name."
"Perfectly reasonable."
"It is. But it also means you've got to be available to me at all
times. Can I rely on that?"
He turned and strolled to the window, pensively. "That may not always
be possible."
"Then you've got a potential problem."
He revolved back and studied me a second, finally taking the bait.
"There is, of course, one very simple solution. I can merely assign you
power of attorney, allowing you to act in my name if I cannot be
reached."
"That would do it. But you'd be handing over a lot of authority."
"I envision no difficulty." He looked me over with the self- assurance
of a tiger contemplating a haunch of beef. "I have every reason to
believe you would always act in DNI's best interest, Mr. Walton."
It was possible he knew a few things I didn't. On the other hand, maybe
Matsuo Noda had just overreached, taken too much for granted. Whichever
it was, the maneuvering just completed had been one small step for Tam,
and Matthew Walton. Should we ever need them, I'd just conned Matsuo
Noda into giving me duplicates of the keys to his Kingdom. It was our
protection and, in a way, my secret price for putting our heads into
Dai Nippon's noose.
"Then it looks like we have everything we need to move forward." I
nodded.
"Excellent."
Upon which I absented his office, safety net in place. The play was on.
Which brings us to Tam Richardson. If my approach to this new job was a
little unconventional, what about the college prof who showed up in
jeans as she readied to renovate corporate America? One thing, we
suited each other. It was a tag team made in heaven. After I'd pried
open the door to the companies DNI was buying, she was going to roll
in, guns blazing, and shove everybody against the wall.
Let me add one important distinction, however. Whereas I may have been
wary, even slightly skeptical, Tam was definitely the idealist. She
was, by God, going to get this country moving again. America was once
more going to lead, she declared, not follow. No defensive Fortress
America claptrap. Hers would be nothing less than a full-scale assault,
intended to win back and keep a solid manufacturing base here, toe-to-
toe with the world.
Since no overall American program existed to rescue industries now
being killed by foreign competition, she was going to do it herself,
create a coordinated battle plan for our strategic sectors. Backed by
Noda's Japanese billions, she was about to try and redeem this
country's future, leading us back to number one. She also was quick to
add she had no intention of merely copying Japan's famous management
techniques. Japanese industry, she insisted, hadn't invented long-term
planning, sound capital investment, dedication. What they did over
there these days was what the U.S. used to do. The American work ethic
was alive and well; it was just temporarily on the wrong side of the
globe. She was about to bring it home again.
Maybe she could. One major impediment at least would be out of the way.
Since the companies Dai Nippon was taking over would no longer have to
answer to a lot of fickle fund managers every three months, they could
start investing for the longer term. Also a lot of unnecessary fat was
going to be sliced out of upper management. If things went as planned,
Dr. Tamara Richardson and Dai Nippon were about to become the ruthless
architects of a new corporate America.
Unless . . . well, there seemed no reason not to take things at face
value, at least for now. DNI's new Industrial Management Section on the
twelfth floor had already begun filling up with young Tokyo University
graduates, guys who embodied the work ethic in human guise. They meant
business. Nobody was sipping coffee and critiquing last night's rerun
of Dynasty. I got the definite impression one of the unsmiling whiz
kids in Noda's handpicked cadre could chew up about five American MBAs
for breakfast. Tam currently had them working overtime, putting
together a reorganization plan for an outfit in Boston, one of their
new acquisitions, which I guess I'd better just call XYZ. The previous
week Dai Nippon had purchased some twenty-four percent of its stock,
presently at a historic low, and she was planning to make the company
her showcase turnaround.
Stock in hand, she'd buckled down with her new staff and using DNI's
analytical machinery confirmed some alarming suspicions. It turned out
XYZ was practically a terminal case, living at the moment off its real
estate assets, which were being systematically dribbled away to mask
heavy losses. Layoffs would be next.
By Thursday of the second week, however, she'd put together a
restructuring, including some painful austerity that might just salvage
the company and its American jobs. She went home that night feeling
quite proud of herself, and Friday she flew up to Boston for her first
official conference with XYZ's chief executive officer.
Since a quarter of a company's shares gives the holder reasonably high
recognition, the CEO was understandably nervous about who exactly had
acquired a fourth of his company inside of a week and a half. He
appeared at Logan with his Rolls limo to receive Dr. Richardson
personally.
She explained right off that she was there merely to pass along a few
of DNI's "recommendations." She took one look at the Rolls and added
that, for example, one of the first was going to be to divest all limos
forthwith, along with the new fifteen-million-dollar Gulfstream IV he'd
bought for weekend fishing trips down in the Keys, and direct the
proceeds toward capital investment.
From there on things progressed pretty much as might be expected. By
the time they reached his paneled office she had been obliged to
explain that his options were either (1) to get in line, or (2) to
watch DNI pick up another thirty percent of his company's O-T-C shares,
then march him and his "golden parachute" past a stockholders' vote
they would call to review his career options. After that she had claim
to his unalloyed attention.
It was a tough Friday. After she flew back late, she dropped by the
office to pick up a few things and fill me in on how it went.
"Good. You're still here." She popped her head around my office door.
"Who won? The Christians or the lions?"
"Want to hear about it?" She came on in and dropped her briefcase on
the desk.
"Wouldn't miss it for the world."
"Matt, you should have seen the look on that man's face." She clicked
open the case and pulled out the action plan she'd developed for XYZ.
She was exhausted but still wired. "These CEOs forget it's shareholders
who own the companies and pay their salaries. They start thinking
they're little Caesars."
"Hey, those are the kinds of operators who used to be my clients.
Believe me, I know the type."
She then proceeded to give me the rundown. Outfit XYZ specialized in
high-tech widgets it sold in the U.S., Latin America, and Europe.
Problem: their widgets cost too much, broke down more than they should,
and consequently folks didn't tend to buy them the way they once did.
As a result XYZ had dropped about five million last quarter and
(unbeknownst to its workers) was currently on the verge of closing two
of its three U.S. plants and exporting the assembly operation someplace
where it could exploit two-dollar labor, a move that would tank just
over a thousand American jobs. Management says, gee, that's tragic, and
awards itself another year-end financial tribute.
Dr. Richardson had just dropped a bomb in the playpen. First off, she
told them, XYZ's damned widgets cost too much not because American
workers are overpaid, but because its assembly plants were a candidate
for the Smithsonian. Therefore, starting immediately, short-term
profits as well as dividends and all management compensation would be
slashed and the resulting capital, together with a new offering of
long- term corporate equities, would be invested in automating its
facilities and retraining workers. There would, in fact, only be
workers in future, since all freeloading middle managers, attorneys,
and drones with titles such as 'administrative assistant' were to be
terminated. She gave them a list.
Henceforth, she went on, management would begin planning ten years
ahead, not three months. XYZ would concern itself with world
competition then, not now, and it would develop a substantially more
diversified product line to cushion slumps. As part of that shift, it
would double the budget for R&D immediately and expand the lab.
Innovation would once again be brought to the product stage fast and
adapted quickly to world markets. XYZ's new focus would be on making
its market share grow in the decade ahead, which also meant cracking
down on quality and halving the current customer-be-damned response
time on deliveries and service. Concerning those last items, product
managers would now be required to address customers' complaints
personally. She figured that in itself would turn around XYZ's
substantial quality control debacle overnight.
Finally, there would be an immediate crash program to rectify XYZ's
costly illusion that English was the worldwide language of business.
These days, she explained, the language of business is the one your
customer speaks. Accordingly all XYZ's overseas operatives would be
required to enroll in intensive language training now, including formal
study of the history and social customs of their territory.
"Sounds like you let him have it with both barrels. Keep on like this,
and the U.S. of A. may never be the same."
"That's the idea. One company down and about three thousand to go."
What's that saying about a journey of miles and miles starting with the
first step? Well, she'd taken the step. The future lay ahead.
"Hey, can I buy you a drink?" I was winding up the day, the week.
"You've earned it."
"Like nothing better." She was repacking her briefcase. "Matt, I'm
having the time of my life. All the things I've always wanted to do.
This is like a fantasy come true. We're going to pull this off, wait
and see."
"Could be." I was switching off the lights in my office. "Tell you
something though, Doctor. I keep wondering what will happen when Noda
gets through with us."
"Thoughts?" She glanced back.
"Well, after Japan takes over half the companies in this country and
starts running them right, then what?" We were headed for the security
doors. "But maybe we ought to talk about that some other time. And
place."
"I'll think about it tomorrow. Just now I'm bushed."
"Tomorrow, in case you've lost count, is Saturday. Don't know about
you, but I'm taking the day off. The hell with Japanese business hours.
My daughter comes this weekend." We were saluted by heavies in the
security airlock, then the doors opened. "Matter of fact, we're going
to eat somewhere down in SoHo tonight. Care to join us? Be warned it'll
be mostly soy by-products and brown rice."
"I'd love to meet her." She looked at me. "Matthew Walton with a
daughter. My God." She laughed. "Sorry, Matt, but you really don't seem
the father type."
"Amy's mother said approximately the same thing as she was packing her
bags. But I'm now undergoing intensive on-the-job father training. Fact
is, I'd planned to knock off around Christmas and take her down to our
place in the islands, though now I'm not sure there'll be time."
"Sounds very fatherly. You should go."
"I'm still hoping to." I looked her over again. "Well, the hell with
it, why mince words. Tell me, Tam, how's your love life these days?"