It's Not Luck - Eliyahu M. Goldratt [103]
“So it’s two months, hmm.” Granby doesn’t sound too happy.
“Is there a problem?” Brandon politely inquires.
“Not really. It’s only that I wanted to have some time to clear my desk. I retire in three months and I wanted to devote my last month to visiting all our facilities. Brandon and Jim, I know that it’s too much, you have already done more than your share, but can I ask you to handle this deal as well?”
“I have a better idea,” Brandon says. “Alex is really the one who led the last two deals. He came up with the concept of what we are selling. He decided which of the prospects would be the best to contact. His presentations are what really made it possible. And let’s face it, he was the one who almost dictated the selling price, first to us and then to the other side. Jim, don’t you agree?”
“Facts are facts,” he says.
“We’ll help, of course. But Alex should formally lead the deal. Alex, don’t you think so?”
“No, I don’t.”
“Come on, stop being modest. It doesn’t suit you,” Jim smiles at me.
“Nothing to do with modesty. I think I shouldn’t lead the deal because I don’t believe that there should be a deal.”
“A typical Alex bomb,” Brandon sighs. “Okay, what do you mean this time?”
“It’s like that joke about Napoleon and the bells,” I answer, knowing that it’s the best way to demonstrate my point. Without allowing them time to object I proceed. “Once Napoleon came to a small village and they didn’t ring the bells for him. Furious, he called the village head and demanded an explanation. ‘We had three good reasons, the frightened man apologized. ‘First is that we didn’t know you were coming. Second, the bell man is sick, and third, we don’t have bells.’ ”
“Nice joke,” Jim enjoys it. “Now what’s the point?”
“We shouldn’t initiate any deal to sell Pressure-Steam because of three reasons. First, there is no more reason to sell. Second, there are no longer any good prospects to sell it to. And third, we need it badly ourselves.”
“Alex, explain, please.”
“What was the original reason for selling the diversified group’s companies? It was the need to improve UniCo’s credit rating. And how much did we expect to get from the sales of all three companies? Less than one hundred and fifty million dollars. And how much have we gotten so far? With today’s deal, it’s four hundred and thirty-eight. How much more do you want? Our credit rating is fine, and admit it, we don’t yet know what we’re going to do with the money we’ve already got. Do we?”
I don’t bother to wait for an answer.
“The second reason is that the best deal we could get would be from Pressure-Steam’s competitors. But how much money is it? They simply can’t raise that much, no matter what. To sell it to anybody else would be a waste.
“Which brings me to the third reason. UniCo as a whole is quite a mediocre company. Sorry sir, but which company in UniCo can we point to as the best in its industry? How about in the top ten? None. We need an internal model. We need a catalyst, a company that will be the school for change. Pete’s company was not appropriate; UniCo doesn’t deal with anything remotely close to the printing industry. Bob’s company was not appropriate for the same reason. But look to what extent Stacey’s company is exactly what we need.
“Almost all our core business companies deal with some mixture of mechanical work and electronics. Almost all of them involve a lot of tailored engineering. They are actually very large job shops. Even if we looked everywhere for a model, Pressure-Steam comes out as the best choice. Gentlemen, we need that company if we want to bring UniCo once again to be the leader that it was. We need Pressure-Steam badly.
They think about what I’ve said. After a few minutes, Brandon turns to Granby, “Next week you are going to present the board with an investment plan. Can you tell us now what you’re going to suggest we do with the money?”
“I decided not