oC ELEBRATING 7 5 YEARS

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Celebrating
75YEARS
of history
Contents
19 23 –1929
C H A P T E R ON E : G U I D E D
BY A
D REAM
5
1930–1939
C H A P T E R TW O : B U I L D I N G
ON A
F OUNDATION
11
194 0 –1949
C H A P T E R TH R E E : S H I F T I N G
INTO
H I G H G EAR
17
19 5 0–1959
C H A P T E R FO U R: BU I L D I N G B U S I N E S S
IN
P OSTWAR AM E R I C A
23
19 60 –1969
C H A P T E R FI V E: MA S T E R S
OF
I NNOVATION
29
1970–1979
C H A P T E R S I X: JO I N I N G
THE
GIANTS
35
198 0 –1989
C H A P T E R S E V E N : OV E R C O M I N G TO U G H C H A L L E N G E S
43
19 90 –199 9
C H A P T E R E I G H T: F O C U S E D
ON T H E
FUTURE
51
© Copyright 1998 by Ecolab Inc. All rights reserved.
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Inquiries should be addressed to:
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Library of Congress Number: 98-073812
INTRODUCTION
I
n 1923, Ecolab began with a single product, a
single employee and a single-minded dedication to being the leader in cleaning and sanitation.
As we celebrate our 75th anniversary, that powerful vision has become a reality. Today the Ecolab
family is a $2.5 billion global enterprise with nearly 15,000 associates. We serve industrial, institutional and hospitality customers in more than 150 countries around the world. > Throughout its
history, Ecolab has achieved its leadership position by being better at what it does than anyone
else. We’ve anticipated customers’ growing needs, providing exceptional service and technologically advanced products and systems. We’ve continually moved the industry forward, contributing to a cleaner, more attractive and healthier world. Our size, scope and expertise today would
undoubtedly surpass our early founders’ wildest expectations. > While technology has been crucial,
it is people who have played the most important role in Ecolab’s success. Since 1923, the spirit,
pride, determination, commitment, passion and integrity of our employees have made this company great. Therefore, this book is dedicated to those associates who, over the years, have built a
solid foundation for our growth. > I am proud to stand at the helm of this outstanding company as
we celebrate a long history of innovation and leadership. I also look forward to the next 75 years,
because I know the best is yet to come.
Allan L.Schuman
President and Chief Executive Officer
4
CHAPTER 1: 1923-1929
Guided by
aDream
Before he founded Economics Laboratory in 1923, Merritt J. Osborn spent nearly 30 years in search
of a product with a future. Osborn, known as M.J. to friends and co-workers, quit high school at 16
and went to work for a pharmaceutical company as a stock boy, then a salesman. His 15-year
career in sales and promotions took him to companies in Chicago, New York and San Francisco. In
1908, he settled in St. Paul to work for Hamm’s Brewing Company and raise his family.
B
y 1911, M.J. was ready to take on his own business. He
ing down the street. He wanted something that would be used up
opened an automobile dealership for White Steamer
daily, if possible, and go down the drain.”
In one brief, ill-fated venture, M.J. marketed a rat poison
Touring Cars at a time when horses and buggies clogged St.
Paul’s narrow dirt roads. World War I ended his successful auto
called Cyanatox. Warm weather caused the Cyanatox cans
business, so he sold tractors instead.
to split open and emit noxious fumes; federal inspectors deemed
He switched to Ford Motor Company at the end of the war, a
the product unsafe and shut down production.
decision that would ultimately break him. Henry Ford, in defi-
Then M.J. hit on another idea. He recalled from traveling
ance of Wall Street, used his dealers and distributors to gener-
that hotel rooms were out of service for up to two weeks when
room carpets were sent to the cleaners. He hired
ate the capital he needed. Overloaded with inventory, M.J.
a chemist to formulate
Osborn was forced out of business in
a product to clean carpet in the rooms.
1923. At age 44, he was back to
He named it Evaporato.
square one, with a wife, two sons,
and only $5,000 to his name.
Economics Laboratory is born
In 1923, M.J. Osborn formed the Evaporato
Down the drain
M.J. was drawn back to his early days
Company, but the name
in business. “His automobile experience
was short-lived. M.J. rethought his
had a very deep effect on his choice of a
business strategy and renamed his
new venture,” said his son, Steve Osborn,
years later. “Country dealers almost always
< C OLLAGE . Clockwise, from top left:
had to take in a team of horses for a tractor
New York City skyline, 1920s; Chicago
skyline, 1929; portrait of Ecolab founder Merritt J.
Osborn, completed in 1951.
sale, and he used to hate to see them com-
< E VAPORATO. Economics Laboratory’s first
product was a carpet cleaner called Evaporato , later
renamed Absorbit .
6
CHAPTER 1: GUIDED
B Y
A
DREAM
< E N D I C O T T B U I L D I N G . Economics Laboratory
got its start in a three-room office on the sixth floor of
downtown St. Paul’s Endicott Building. The company later
moved to a
larger office in the building’s basement.
> I DA KO R A N . M.J. Osborn hired his first
employee, Ida Koran, to manage the office
while he built the business. A lifelong employee, Koran
established the Ida C. Koran Trust for Ecolab employees
upon her death in 1967.
product Absorbit and his company Economics Laboratory, to
On March 10, 1923, Economics Laboratory posted its first sale
reflect his hopes for the future. The new company would be
to Herman’s Cafe in Faribault – 100 pounds of Absorbit at
“economic” by helping customers save time, labor and costs.
a total cost of $18.
Later that year, the company moved to a basement “suite,”
The company’s products would be backed by “laboratory”
research. Economics Laboratory’s motto, “Saving Time –
which included a small back room for production. The staff
Lightening Labor – Reducing Costs to Those We Serve,” was
grew with the addition of a burly, jack-of-all-trades named
printed on company stationery.
George Meixner and two young ladies to make sales calls to St.
Paul businesses. Meixner mixed and packaged Absorbit by day,
In 1923, M.J. rented three small rooms on the sixth floor of
St. Paul’s Endicott Building. He hired a local
then vacuumed and scrubbed rugs at night in offices throughout
carpenter, Elmer Linnerooth, to build a mortar box for mixing
the city. “A very nice little business was developed on this,” said
Absorbit, and he purchased a five-pound scoop. Then he visited
Koran. “Actually, it was our only source of income.”
Homemakers liked the product, too, so the company started
the L. C. Smith Typewriter Company to purchase a typewriter
and told the clerk he was looking for a secretary. She contacted
selling eight-ounce packages through grocery stores. It was a
a friend named Ida Koran and arranged an interview.
decision they would soon regret. Absorbit was tricky to use, and
“Mr. Osborn told me something about the ideas he had and
the wrong mix brought disastrous results. “It got so that when-
painted quite a picture, but actually there was nothing tangible at
ever I lifted the telephone I was afraid I would hear a hysterical
all,” said Koran. “This was all a dream and in the future, and I
woman screaming that her rug had been ruined,” said Koran.
really didn’t see where he had
Economics Laboratory abandoned the retail business
a job to offer me, though at the same time
and concentrated on hotels, streetcars, railroad lines and
I thought he was a very fine gentleman.”
other commercial customers. These customers had no
Ida Koran refused M.J.’s job offer, but he
complaints,
was persistent. He called her ten days later about
but another problem arose. A little Absorbit went
a long way. One order lasted a long time, so repeat
freelance dictation. This time he sold
sales were slow in coming.
her on a $100 a month job. “There was just
one promise that Mr. Osborn made which he didn’t
keep,” said Koran. “He promised me
that I wouldn’t have to work hard, I was really going
to have very short hours, and the whole job would
be a picnic.”
< AB S O R B I T
The job was no picnic. M.J. worked up to 14
AND
S O I L A X . After struggling with slow
Absorbit sales, Economics Laboratory achieved success with its
hours a day, seven days a week as administrator, salesman, mixer and packager. Ida Koran was
second product – Soilax.The chemical cleaner was perfect for use
in mechanical dishwashers, a growing technology.
the resident secretary, bookkeeper and floor sweeper.
> E CONOMICS L ABORATORY S TOCK . M.J. Osborn con-
vinced a few local business leaders to invest in his
fledgling company. A $5,000 investment by Charlie Stott
in 1924, shown in this stock certificate, helped Economics Laboratory
succeed.
6
CHAPTER 1: 1923-1929
< A BSORBIT B OX . Absorbit, Economics
Laboratory’s first product, cleaned carpets
on the spot, eliminating the need to
send carpets to the cleaners.
> S O I L A X BA R R E L . In its early years,
Soilax was packaged in wooden barrels and shipped to
customers by rail. In the late 1920s, production moved
to Chicago.
Teetering on the edge
mechanical dishwashing. Automatic dishwashers had been around
By 1924, Economics Laboratory was in serious trouble. Bills
since the 1860s but didn’t clean dishes well. However, technolo-
were piling up and the initial $5,000 nest egg was long gone.
gies were improving, and the transition from hand to machine
After incorporating in February 1924, M.J. struggled to save the
washing was beginning. The chemically formulated, non-suds-
business. From morning until night he walked the streets of down-
ing Soilax was a great improvement over ordinary soap. It was
town St. Paul, knocking on doors and looking for investors.
also easy to make. The three ingredients could be stirred together
After weeks of grueling effort, his persistence paid off. Charlie
with a garden hoe. And for two years, that’s how it was done.
Stott of the Stott Briquette Company liked M.J.’s story, so he
Economics Laboratory received its first patent on
bought $5,000 in Economics Laboratory stock. He sent M.J. to
May 11, 1926, for Floroscene, a concentration indicator
see Alex McDonnell of Weyerhaeuser Timber Company, who
in Soilax. The breakthrough product became the company’s
invested another $5,000. Osborn returned to the office with
foundation.
$10,000. “He was really walking on air,” said Koran. “It didn’t
take me very long to get the $10,000 into the bank and begin
The pink powder
paying some of our bills.”
Conditions at the Endicott Building were challenging.
The basement was cold and drafty. Myrtle Shoemaker,
Soilax breaks through
who joined the company in 1924, had to dump a mouse out of
Business was out of the red and in the pink – in more ways than
her desk drawer almost every day.
one. Absorbit’s limited market potential had prompted M.J. to
With the addition of Soilax, pink dust was soon sifting into
search for other new products. He acquired one from a young
the main office from the production room, covering everything.
University of Minnesota chemistry student named Leonard H.
“I would have a few pink and some green marks on my face,”
Englund, who had developed a simple but effective cleaning
said Koran. “And no matter how much I would scrub, when I
compound. M.J. named the new product Soilax – based on
got home
“soil” or dirt, and “lax” for loosen.
I usually had some of the Soilax
Soilax’s magical color
siftings on me.”
change was the market-
By 1925, the company had
ing clincher. In powder
outgrown its basement
form, Soilax was pink.
dwelling and moved to 2540
When mixed with water
University Avenue,
in the proper proportions,
a small building in St. Paul’s
the solution turned green. If
Midway district.
too much Soilax was added,
A year later, the company
it turned yellow, warning the
moved again to
customer that the solution
was too strong. M.J. recognized Soilax’s potential for
7
CHAPTER 1: GUIDED
B Y
A
DREAM
< G EORGE M E I X N E R . Economics Laboratory
hired its second employee, George Meixner,
in 1923. In the late 1920s, Meixner moved
to Chicago to set up and manage the
company’s first production facility.
> WASH B OILER DI S P E N S E R . Economics
Laboratory first demonstrated its technological expertise
in 1928, when it patented the first Soilax dispenser for
mechanical dishwashers. Cutting-edge technology, combined with superior products
and service, became a company trademark.
Searching for salesmen
the Weyerhaeuser Timber Company warehouse at 2694
University Avenue. A 100-pound mixer had replaced the mortar
Through most of the 1920s, M.J. Osborn was virtually a one-
box and hoe. Soon they were receiving raw materials by the car-
man band, acting as sales manager, purchasing agent, production
load. “This was the most eventful period in our history,” said M
manager, and with the help of George Meixner, factory manager.
J. Osborn, years later. “Soilax was clicking. We were now in
M.J. personally hired every salesman.
big-time manufacturing.”
Unfortunately, many early salesmen were not polished pro-
In the late 1920s, the company moved yet again and split its
fessionals. With the introduction of Soilax, Economics
operations. “We found ourselves receiving chemicals from
Laboratory hired its first traveling salesman – Daddy Ash – to
Chicago, compounding them and shipping them right back to
cover St. Paul and surrounding towns. An unsophisticated, col-
and through Chicago,” said M.J. Osborn. So headquarters moved
orful character, Ash signed his correspondence, “Yours to a cin-
to the Minnesota Building in downtown St. Paul. George
der.” His rattle-trap car was an embarrassment to M.J., and his
Meixner took the 100-pound mixer with him to
wardrobe was bizarre. “He had a bunion on his foot, he wore
the Crooks Terminal Building in Chicago to handle business in
white socks, and he had the front part of his shoe cut away,”
the East.
recalled Steve Osborn.
In 1928, Economics Laboratory invented and patented the
Recruiting salesmen was difficult for a small company with
first “wash boiler” dispenser that injected Soilax into a dish-
limited products and resources. Keeping them was even harder.
washing machine. Modeled after a toilet, the dispenser con-
Training was minimal. A new salesman rode with another for a
tained a float, which dropped as the solution level fell,
few weeks and watched him work. Then he got an order blank,
eventually opening a water inlet valve. Less than a dozen dis-
a briefcase, and he was on his own.
pensers were built due to high cost and complicated design. But
it marked the beginning of the company’s expertise in mechanical technology.
9
CHAPTER 1: 1923-1929
< E.B. OS B O R N . M.J. Osborn’s son,
Edward Bartley, known as E.B., joined Economics
Laboratory a year after his brother, Steve, but stayed on
for life. He began in sales, moved into management and
took control of
the company after his father’s death in 1960.
> S.A. OS B O R N . After graduating
from Dartmouth, Steve Osborn joined
Economics Laboratory in 1927, eventually
specializing in advertising and promotion.
M.J.’s guiding philosophy
from Dartmouth and joined the sales force. His proving ground
Despite the difficulties, M.J. set high standards for his
was New York City. For E.B., Economics Laboratory was an all-
company regarding products, people and technology. Those
consuming passion – one that would shape his life and that of
guiding principles demanded that:
the company.
n
n
n
n
Products must fill an existing need that was not being satisfactorily met.
Disaster in Chicago
Economics Laboratory would be a leader in developing new
“I have no employees, only associates,” M.J. was fond of
products and technology.
saying. He was called upon to demonstrate this team spirit soon
When entering a new market, Economics Laboratory would
after production moved to Chicago. George Meixner was work-
know more about the cleaning processes of
ing alone in the Chicago warehouse one Saturday, when he
that industry than anyone else, including the customer.
stepped into an open elevator shaft. He lay broken and bleeding
The company would deliver excellent customer service.
for hours until discovered by a night watchman. When M.J. got
In M.J.’s mind, service was undeniably linked with sales and
the news, he immediately contacted Chicago’s best doctor and
was an overriding priority. “Accept the customers’ problems as
hopped a plane. M.J. remained in Chicago for two months. By
if they were your own,” was M.J.’s philosophy. Therefore,
day, he donned coveralls and took George’s place in the factory,
Economics Laboratory salesmen not only sold the product but
manufacturing Soilax, lifting barrels and drums, and supervising
also trained customers in its use. When problems arose, the
shipments. At night, he was in the hospital at George’s bedside.
salesman was expected to solve them. “Sometimes that service
Good care helped Meixner pull through. Thanks to M.J., the
was nothing more than punching prune pits out of a dishmachine
health of the company was also stable.
tube,” said former President and Chief Operating Officer Fred
Lanners. “But the salesman was there. And when he left, he left
his ‘calling card,’
a special card that indicated to the customer, in writing, that the
job was done.”
Second generation comes on board
In 1927, M.J. Osborn’s son Steve completed his college degree
and joined the company in sales, then in advertising and promotion. In 1928, his son Edward Bartley, known as E.B., graduated
B U I L D I N G . In 1926, Economics Laboratory
moved to its third location – the Weyerhaeuser Timber Company –
along St. Paul’s University Avenue.
< WE Y E R H A E U S E R
> C H I C A G O F ACTORY , 1920 S . Strong business growth in the
eastern United States and a good transportation system made Chicago
the logical location for the company’s first production plant.
10
‘‘Have faith in us, in yourself
and in Soilax, and be profoundly convinced that it
will pay people to do business with you.
you.’’
CHAPTER 2: 1930-1939
Buildinga
Foundation
The hard times brought on by the Wall Street crash of 1929 were slow to reach Economics Laboratory. Soilax
was a superior product and hotels and restaurants were eager to buy it. But most sales were made on
credit, and, as the Depression deepened, customers started falling behind on payments. “The 1929 crash
did not affect us for another two or three years,” said Steve Osborn. “We commenced to feel it in 1932
and things became pretty tight. We almost went under in 1933.” To keep the company afloat, employees
gave up one month’s salary and took a cut in pay.
N
“
o class of men have experienced more discouragement
expected to sell Soilax and also hire, train and supervise
and faced greater obstacles in the last two
a sales force. Many new hires weren’t up to the task.
years than have salesmen,” M.J. Osborn wrote in a 1934 New
Resignations and firings were frequent, and customer problems
Year’s message to employees. “Have faith in us, in yourself and
were commonplace. And when things went wrong, it was up to
in Soilax, and be profoundly convinced that
E.B. Osborn to make things right.
it will pay people to do business with you.” That year, after two
After six years in New York, E.B. returned to St. Paul
years of operating in the red, Economics Laboratory finally net-
as sales manager in 1934, with a $250 monthly salary
ted a profit of $98.19.
and a meager expense account. For the next 12 years,
he virtually lived on the road. One business trip kept
The growing
him away from home from January 10 until August 22.
national market
E.B.’s location varied; his routine did
Armed with Soilax, Economics
not. He arrived in a city by train,
Laboratory diligently expanded
checked into a hotel and picked up
its sales organization. One
a city map. Then, with rented car,
by one, cities throughout the
Midwest and the East joined the
Economics Laboratory domain. By
< S O I L A X L E T T E R H E A D . In the 1930s,
the mid-1930s, the company
employed about 34 so-called “pow-
Economics Laboratory built a solid business on
the success of its most popular product – Soilax .
der peddlers” in St. Paul, Des
< C OLLAGE . Clockwise, from top left: In the 1930s, a
downtown Minneapolis billboard at the corner of
7th St. and Hennepin Avenue promotes the benefits
of Soilax; an EL chemist practices “Research
in Cleanliness;” George Meixner
oversees the Chicago factory.
Moines, Detroit, Chicago,
Cincinnati, Kansas City, New York and
Boston. The man in charge of each city was
12
CHAPTER 2: BUILDING
A
FOUNDATION
< H OME O F F I C E ST A F F, G L O B E
B U I L D I N G, 1935. Front row, left to right:
A.N. Larson, Ida C. Koran, E.B. Osborn,
M J. Osborn, S.A. Osborn, H.W. Collins,
John L. Wilson. Back row: Edna Appel Devine, Myrtle
Johnson Shoemaker, Dora Lee Nelson, Bertha
Spanenberg McElligott, Isabel Sixl,
Linda Jarvinen Shreir, Della Johnson
he called on customers to resolve problems and conducted cold
those maps impressed customers. E.B.’s extensive knowledge
calls to drum up new accounts. Working with local employment
and his description of company research added even more
agencies, he identified and interviewed potential salesmen and
punch to his presentations.
carefully checked their references. At the end of each long day,
Product demonstrations were standard sales procedure. Each
E.B. returned to his hotel, jotted down voluminous notes on the
salesman in the 1930s was provided a black suitcase containing
day’s activities and typed correspondence on his portable type-
a thermos bottle full of hot water, a glass dish,
writer. He personally trained the men he hired throughout the
a sponge, a package of Soilax and pieces of aluminum to
week and on weekends. By 1937, Economics Laboratory had
demonstrate the merits of Soilax to prospects on the spot.
salesmen in 35 cities across the country.
Salesmen passed on sales tips through the Economics
Reporter, a company newsletter begun in 1933. To sell
Selling scientifically
MikroKlene, a germicidal rinse introduced in 1935, a
The psychology of selling was a passion for E.B., and he sought
salesman wrote: “I fill a glass with soda water and show the
to make it a science – a science he had learned the hard way.
restaurant manager the thousands of tiny bubbles that appear on
Lack of training, coupled with his natural shyness, had made his
the sides of the glass. Then I fill another glass with soda water
earliest sales efforts painful and unrewarding. He overcame his
that has been well washed with MikroKlene. Few, if any, bub-
handicaps through astute observation, meticulous planning and
bles will appear. Bubbles are caused by grease and are the
careful record keeping. The
result of an improperly cleaned and unsanitary glass. Coca-
sales techniques culled from his own experience helped him
Cola® salesmen hammer and harp on this point, for the libera-
form
tion of carbon by soiled glasses makes a
a standard selling system for the sales
relatively inferior drink.”
organization.
Round-the-clock service
“Informational selling” was instilled
in every company salesman. “You sell
But it often took more than sophisticated
during a Depression by going to no end
sales techniques to justify the high price of
of trouble to find out all of the cus-
Soilax. Service was the answer, and E.B.
tomer’s problems, by studying some of
Osborn turned his salesmen into dishwash-
their methods so that we know some of
ing consultants.
them better than they do
themselves…that’s thinking salesmanship,” E.B. wrote to salesmen in the
1930s. E.B. supplemented his own
< I NNOVATIVE P R E M I U M S. Soilax relied on a
variety of innovative premiums to help it compete in the
retail market.
sales presentations with visual aids,
including maps of hard and soft water
> F REE A DVERTISING. An independent
areas. The enormous variation in
trucking firm won the Soilax delivery contract in Chicago in the 1930s by providing
a little free advertising.
cleaning problems indicated by
13
CHAPTER 2: 1930-1939
< Economics Laboratory salesmen like Emil Briel helped
hardware store owners from Des Moines
to Omaha develop eye-catching Soilax displays. In this
Sherwin-Williams store, Briel’s display, coupled with the
two-for-one giveaway,
captured customer attention.
> ULYSSES S. G RANT. Loyal and tenacioussales
veterans suchas Ulysses S.Grantwent to great lengths to help
the companysucceed. In addition to sellingthe product,Grant
invented the company’s first usable Soilax dispenser
and had it patented in 1933.
Soilax salesmen not only sold the product but also fixed and
was a farm kid, you know.” But he got the business, and eventu-
maintained the dishwasher, trained kitchen employees to use it
ally worked his commissions up to $1,400 a month, ten times
properly, analyzed dish handling procedures and recommended
the average.
ways to minimize breakage. They were on call 24 hours a day.
Hardware stores discover Soilax
Paul Evans, who joined Economics Laboratory in
Philadelphia in 1936, was the type of salesman the company was
While Economics Laboratory salesmen were promoting the
looking for. Whatever it took to get the business, Evans was
virtues of Soilax for mechanical dishwashing, others were using
game. One time, an owner of a small restaurant decided to have
it as an all-purpose cleaner. “We couldn’t understand why hard-
some fun with the enthusiastic young salesman.
ware stores were buying so many barrels of Soilax,” said Ida
“If you wash the dishes tonight and you do a good job and the
Koran. “We discovered that they were packaging it in five-
product works like you say it will, I’ll buy it,” the man said.
pound paper sacks and selling it to housewives for a dollar. They
Evans returned at 5 p.m. and started washing dishes. Hour by
would scoop it out of the barrel just like the old time grocer used
hour, dirty dishes poured in. He wondered how such a tiny
to scoop sugar.” Painters and contractors were also using Soilax
restaurant could serve enough customers to generate so many
for washing and cleaning walls before painting. Des Moines
dirty dishes, but he continued to work doggedly. At 2 a.m., after
salesman Emil Briel picked up quickly on the new market and
washing the last plate, he asked
began to supplement his restaurant and hotel business by calling
an employee where all the dishes came from. The employee
on paint and hardware stores.
Two Des Moines salesmen, known as “the Myers boys,”
pointed outside to a long row of parking spaces where cus-
observed Briel’s success at hardware stores and persuaded
tomers could order and dine in their cars.
“I’d never seen what is known as a drive-in,” recalled Evans. “I
14
CHAPTER 2: BUILDING
A
FOUNDATION
< D R . W I L S O N . Economics Laboratory’s
commitment to scientific cleaning inspired
M.J. Osborn to add a Ph.D. chemist, Dr. John
L. Wilson, to the company staff in 1931. Wilson led the
company’s research effort for 20 years.
> B I L L PO D A S . Chemical engineer Bill Podas joined
Economics Laboratory in 1938. When he retired in 1983,
he headed the company’s multi-million dollar research and
development center and was the last remaining employee
to have been personally hired by the company’s founder.
M.J. to package Soilax for the grocer. In 1935, Soilax was
ments. “Economics Laboratory” and “Soilax, A little does a lot,”
offered to grocers in a one-pound blue box. “It gave our men an
was emblazoned on the side of at least one truck.
additional product to sell, and it helped increase their earnings,”
said Steve Osborn. “Many of them were making $12,000 a year
Research in cleanliness
in 1938.”
Dr. John L. Wilson began his 20-year career with Economics
Laboratory in 1931, as head of company research. In his one-
The company backed its grocery effort with innovative premiums, including goldfish bowls, scrub pails and the like. But
room laboratory, Doc Wilson mixed cleaning compounds, con-
without a hefty advertising budget to promote the new consumer
ducted product tests, washed bottles and worked with salesmen
product, grocery sales were going nowhere. In less than a year,
on new ideas. One
Economics Laboratory abandoned the retail grocery market and
innovative salesman, Ulysses S. Grant, a descendant of
reclaimed the blue-boxed Soilax.
the famous U.S. general, was granted a patent for the
company’s first workable dispenser in 1933.
Spreading the word
A young chemical engineer named Bill Podas found
In 1937, Economics Laboratory repackaged Soilax in a bright red
a wife and a career at Economics Laboratory in 1938 and dou-
box picturing a hand wiping a sponge across the front. “Loosens
bled the research staff to two. “I took the streetcar from
dirt, dissolves grease,” it declared. “A little does
Minneapolis to the old Globe Building,” he said. “When
a lot.” Print ads were placed in women’s magazines and color
I got up to the sixth floor, I saw a sign on the door saying
Sunday newspaper supplements, premiums were offered and
‘Economics Laboratory, Inc., Manufacturing Chemists.’
radio commercials aired. And, thanks to Chicago plant manager
I went inside. There was a receptionist and that girl – the first
George Meixner, the company
person I ever saw at Economics Laboratory – was the girl I mar-
got free promotion from the trucking firm handling its ship-
ried.”
15
CHAPTER 2: 1930-1939
IN 1934. Chicago plant manager George Meixner inspected packages traveling
through the semi-automatic carton
filling and sealing machine in 1934. By 1939, the
Chicago facility included 10 employees and
a second-hand automatic packaging machine that could
produce 30 packages per minute.
M A K I N G SO I L A X
“Bill, you look like our kind of folks. Do you want to go to
Two years later, Economics Laboratory incorporated a new
work for us?” asked M.J. after a brief interview. “I did at $125 a
chemical, called sodium tetraphosphate, into a new and improved
month. Then I thought about it, and I said, ‘Mr. Osborn, what
dishwashing detergent. The company terminated distribution of
kind of business are we in anyway? Do we manufacture chemi-
Calgonite for its new product – Super Soilax. Calgon retaliated
cals?’ and he said, ‘No, we will someday. Right now we’re
with a patent lawsuit to block production of Super Soilax. Had
mixing cleaning compounds for restaurants, hotels, painters and
the tide turned against it, Economics Laboratory would have
housewives,’” recalled Podas. His first job was formulating a
suffered a severe and possibly fatal financial blow. But after
new floor wax, called Satin Wax.
intense litigation, Economics Laboratory emerged victorious.
Despite its limited size, Economics Laboratory’s
research efforts were the crux of the company’s scientific sales
The end of the decade
approach widely promoted in company advertising. By the late
In 1937, 13 years after incorporating, Economics Laboratory
1930s, ads for new Super Soilax featured a
paid its first dividend of $1 per share. Thus began an uninter-
scientist in a lab coat with test tubes promoting “Research in
rupted stream of annual dividends and stock splits, fueled by
Cleanliness.”
strong company growth.
By 1939, Economics Laboratory sales were at the half mil-
The Calgon fight
lion mark, and about three dozen salesmen covered the country.
In 1934, a competitor developed sodium hexametaphosphate, a
Ten people manned a small Chicago factory, which had installed
water conditioning chemical that greatly reduced filmy deposits
a used automatic packaging machine capable of producing 30
left by automatic dishwashing detergents. The new Calgonite
was vastly superior to Soilax. So the Osborns went to
Pittsburgh and persuaded
Calgon to make Economics Laboratory
the exclusive distributor of the new miracle
product. Suddenly, salesmen were being
instructed to sell Calgonite against Soilax. It
outsold Soilax three to one.
packages a minute. A newly purchased plant in New Jersey
was up and running.
Back at home, more than a dozen people
worked at company headquarters, which
had moved into the Guardian Building in
1939. “Those were exciting times,”
recalled John Johnson. “We
worked hard at our jobs
and we were a close knit group.”
But Economics Laboratory,
< S UPER S OILAX . The success of Soilax led
and the country, would soon
to a dizzying array of Soilax spin-offs including Soilax
A, Soilax B, Soilax C , and Super Soilax, shown
here, which was introduced in 1937 to combat
competitor Calgonite.
face another challenge.
> G UARDIAN B U I L D I N G. Economics
Laboratory moved into the ninth floor
of downtown St. Paul’s Guardian Building in
1939. By 1963, the company occupied all but
the ground floor.
CHAPTER 3: 1940-1949
Shifting into
HighGear
In 1940, Economics Laboratory was making a name for itself with Soilax. Testimonial letters praising the
effectiveness of Soilax poured into company headquarters. “It’s wonderful,” said one writer. “I put it in the bath
water for my cocker spaniel and she emerged with a beautiful lustrous coat. So my daughter decided to use it
in her shampoo with apparently marvelous results.” The versatility of Soilax was the subject of another writer,
who used it to clean leather shoes, mixed it with shaving soap and added it to furniture polish. Other customers
wrote of powdering a baby’s bottom with Soilax during diaper changes, sprinkling it on a steak as a meat tenderizer and adding it to toothpaste.
T
he success of Soilax created something of a black
War II, brought a sudden and dramatic shift in the company’s
market for the product, a problem that turned salesmen
direction and an entirely new product focus.
into sleuths. The company newsletter was filled with reports of
people selling cases of Soilax out of back alleys and car trunks.
MikroKlene to the rescue
One Michigan salesman posed as a meat cutter in a Grand Rapids
When the war began, the nation quickly transitioned
grocery store to get access to a back room, where the illicit sup-
its production capacity to support the war effort. Within months,
plier’s name and address were filed.
the military requisitioned Economics Laboratory’s small, newly
acquired property in Newark, New Jersey, and converted it into
By 1942, sales at Economics Laboratory topped the
a military facility. In
million dollar mark for the first
time. But the Japanese attack
Washington, D.C., the War
on Pearl Harbor one year
Production Board started to
earlier, followed by
ration
America’s entry into World
raw materials. Companies
producing non-essential
products were nearly
> M IKROKLENE L A B E L .
brought to a standstill.
MikroKlene was developed in 1935,
To stay in business,
but its true value didn’t emerge until
the U.S. entered World War II.
MikroKlene,
kept the company in business
during the war years.
Economics Laboratory had
to do its part to
support the troops.
18
C HAPTER 3 : SH I F T I N G
< T RAIN LOADING
AT
INTO
HIGH G EAR
C H I C A G O F ACTORY .
Before the war erupted, Soilax was the company’s
mainstay. Cartons of Soilax were shipped by the carload to distributors around the country.
> A UTOMATIC PA C K A G I N G , 1940S .
By 1940, Economics Laboratory was packaging 600
cases of Soilax B each day. This automatic packager
ran 24 hours a day during the spring cleaning season to
meet consumer demand.
Luckily, the key to continued operation was close at hand. In
scrounged things; we drove all over and picked up anything that
the 1930s, Doc Wilson and a University of Minnesota microbi-
we could find that we thought we might need.” In Brooklyn,
ology professor had developed MikroKlene ACS-4,
employees salvaged old wire where they could find it. In
a powerful germicidal disinfectant used to sanitize milk cans and
Greenwich Village, they cruised alleys looking for discarded
glasses. The product was a natural solution to a major military
motors. At the plant, the chemicals used to make MikroKlene
threat – disease. The crowding and unsanitary conditions sol-
were caustic and irritating to eyes and skin. A shortage of work-
diers endured in army camps made amoebic dysentery spread like
ers made production even more difficult. “In two years, we had
wildfire. In 1942, Economics Laboratory was granted the con-
two Christmas days off,” said Beyer. “We worked seven days a
tract to produce MikroKlene ACS-4 for shipment to the front.
week, sometimes as much as
The contract gave the company
24 hours a day, until we dropped.”
the raw materials needed to maintain production and a guaran-
When Beyer did finally collapse with the flu, the Osborns,
teed customer – the United States government.
who were staying in New York, took him in. M.J. packed him
Soon the use of MikroKlene germicidal dishwashing rinse
into a cab and checked him into an adjacent room at the
was standard procedure in military installations throughout
Gotham Hotel. Mrs. Osborn nursed him back to health.
Europe and the Pacific. Tubs of MikroKlene solution were
Sales from MikroKlene enabled the company to add a new
placed on the decks of transport ships and in Army camps in
Chicago factory in 1944. After the war, the company sold its
every corner of the world. After washing his mess kit with
Brooklyn plant and moved back to Lyndhurst, New Jersey.
soap, each soldier finished the job by dipping it in
Company management toyed with the idea of moving
a MikroKlene solution. The chemical was also used to wash
Economics Laboratory headquarters to Lyndhurst, as well, but
fresh fruits and vegetables in tropical areas.
roots were strong in St. Paul. They decided to stay put and focus
Economics Laboratory eventually made 100 million units of
the company’s resources on research and the development of new
MikroKlene during the four years of the war. “MikroKlene was
products.
the single product that kept Economics Laboratory going,” said
Despite its conservative business approach, new technolo-
Bill Podas.
gies began to creep into the office environment.
A state-of-the-art duplicating machine purchased in 1945
Hard times during the war
was front page news in the company newsletter. A new tele-
In 1942, the company moved its production operation
phone switchboard, complete with central reception and 23
into an abandoned warehouse in Brooklyn, New York, and
phone stations, was another impressive modernization. “We
Chemical Engineer Bill Beyer was charged with getting
didn’t have computers and fancy equipment,” said John
it up and running to produce MikroKlene. “There was no
Johnson. “We kept a tight rein on finances and operated on gut
glass in the windows. It was just a shell,” said Beyer. “There
feeling and instincts. We had to turn pencils
was nothing to work with because we were at war. We just
in and get them resharpened.”
ON PAGE 16. Clockwise, from top: World War II soldiers
sterilized their mess kits in MikroKlene solution; a former soldier returned to work
at the Brooklyn plant in 1946; glassware sparkled after a Super Soilax cleaning.
Postwar growth
< C OLLAGE
Massive changes hit the nation in the postwar era. Labor costs
soared throughout the U.S., and labor unions gained
19
CHAPTER 3: 1940-1949
< O U T D O O R A D V E R T I S I N G . In postwar
America, Soilax regained its premier
position as the top selling product at
Economics Laboratory. This 1946 billboard touted the
economy and cleaning ability
of Soilax to American homemakers.
strength. Restaurants and hotels could no longer afford
That was really the first time we were differentiated from our
to hire people to wash dishes by hand, as most had done before
competition.”
Service, not product, became the bedrock of the company’s
the war.
success. “Nobody wants to buy a detergent, they want clean
Responding to this opportunity, Economics Laboratory’s
research team introduced new dishwashing machines, electronic
dishes,” said Lanners. “So we got them clean dishes. We gave
dispensers, heavy-duty detergents and rinse additives to the
all the credit to our product, but it was really our sweat and
institutional market. The company backed its new products with
work that made it work.”
exceptional customer service.
Happenings on the home front
In 1946, the company introduced the first electronic dishwashing dispenser. This major advance in technology allowed
Big things were also happening in the consumer area in the post-
the dish machine to sense the concentration of detergent, like a
war years. Tract home developments were springing
thermostat. In 1948, the company developed the first rinse addi-
up like weeds all over the country, as soldiers came home eager
tive. It seemed that dishes unloaded from restaurant dishwashers
to marry and settle down. Modern kitchens, complete with an
were never completely dry. Kitchen workers had to finish the
array of electric appliances, were part of
job with a dishcloth, which contaminated the dishes. But the
the new era. Suddenly, the home dishwashing machine
new rinse additives caused water to sheet off the dishes, dramat-
was a high volume appliance.
Young homemakers were particularly interested in
ically speeding the drying process. Injecting it into the dish-
dishwashing machines and the company
washer was the next challenge.
was eager to show them the wonders of this new
W.C. “Red” Sannor, a New Jersey salesman during the war
convenience. Economics Laboratory hired a
years, made equipment servicing and
training a priority in his sales
home economist, named her “Alice White,”
efforts. “Sannor found out he
and put her to work answering questions
could sell like mad if he went
mailed in by homemakers. At the same time,
in and made sure everything
Economics Laboratory representatives vis-
was working right,” said Fred
ited neighborhoods, randomly knocking on
Lanners. “When M.J. saw how
doors, and demonstrating new products to
effectively he was developing
housewives. “We’d take the machine out,
business in New Jersey, he brought
show them how to rack them, how much
him in to become service manager
detergent to use, and check water hardness,” said Podas.
and teach everybody to do it his way.
The company worked hard to
move new products and technology
into the field. Bill Podas and
> M AGAZINE A D. This full-page ad
for Super Soilax , featuring the brand’s
germ-killing effectiveness, appeared in
magazines geared to the hotel, restaurant
and food industries throughout 1944.
20
C HAPTER 3 : SH I F T I N G
INTO
HIGH G EAR
W I T H PANS . Homemakers kept
their pots and pans gleaming with
Pan Dandy, a specially formulated cleanser developed to scrub away tough cooking stains.
< H OUSEWIFE
> M.J.
E.B. In 1946, M.J. Osborn (seated)
and his son E.B. Osborn worked
hand in hand at the company’s
Guardian Building headquarters.
AND
other research specialists traveled from coast to coast, work-
few complaints and returns and the promotion was, of course,
ing with salesmen on product development and technical service
discontinued.”
and getting clearances from health departments, plumbing
departments and electrical departments. The company worked
The company divides into two markets
with appliance manufacturers such as General Electric,
In 1948, the company separated into two sales divisions. The
Westinghouse and Hotpoint to get Economics Laboratory’s new
Kitchen Division catered to hotels, restaurants, schools and
dishwashing detergents approved for the new dishwashing
other institutions. The Packaging Division served consumers
machines.
through wholesale and retail outlets.
The success of Soilax had sparked variations on the well-rec-
Prizes and promotions
ognized brand name in both divisions. The Kitchen Division
Throughout the 1940s, advertising budgets for Economics
marketed three types of Soilax for mechanical dishwashing:
Laboratory products were minimal. Ads for Soilax continued
Soilax Formula A was used in soft water areas, Soilax Formula
appearing in women’s magazines and on local radio. Prize give-
C was used in moderately hard water areas, and Super Soilax
aways were a promotional mainstay, sometimes with hilarious
was marketed for hard water use. There was also Super Soilax
results.
Heavy-Duty for tougher mechanical cleaning jobs. In addition,
there was Tetrox, formulated for hand washing, and Pan Dandy,
A regional coffee company had run a successful promotion
that awarded registered wire-haired fox terriers to prize winners.
for pot and pan scrubbing. MikroKlene rounded out the divi-
Economics Laboratory decided to run a similar radio promo-
sion’s product line.
The Packaging Division sold Soilax Formula A to grocery
tion. The “Why I Like Soilax” promotion awarded live canaries
to the best customer entries. “We
stores, and Soilax Formula B to paint, hardware and variety
got a very good mail response,” recalled Steve Osborn.
stores for use as a general cleaner. It became evident that one
“Unfortunately, this was in the spring, and we didn’t realize that
product could not support an entire division. Also, the names
canaries molt in June and they don’t sing. We did get quite a
were getting too confusing. The company decided to capture the
new home dishwashing market with a fresh new consumer product. Super Soilax Heavy Duty was renamed Electrasol, in reference to the new “electric” appliance trend. It was the first
detergent made for home dishwashing machines and it was an
immediate hit.
< E L E C T R A S O L A N D PAN D ANDY. In the postwar years, Economics
Laboratory’s research efforts yielded a number of successful new products, including
Pan Dandy, a pot and pan cleaner, and Electrasol, the first powdered detergent
exclusively developed for automatic dishwashers.
> D I S H W A S H I N G D IVIDENDS . In 1946, E.B. Osborn wrote and
produced “Dishwashing Dividends,” thefirst of several colorand sound motion pictures.
During the shooting, Osborn, right, discusses a film
take with Professor H.B. Meek at Cornell University’s Hotel School.
21
CHAPTER 3: 1940-1949
ANNIVERSARY . In February 1949,
Economics Laboratory celebrated its
25th anniversary with a banquet at the
Hotel Lowry in downtown St. Paul.
Bill Podas, left, Master of Ceremonies,
welcomes M.J. to the celebration.
Ida Koran (seated, left) and Mrs. M.J.
Osborn join M.J. at the head table.
< 25 T H
rather than ‘Soilax,’” said Bill Podas, who helped produce the
Electrasol’s success secured the company’s consumer market
position at a crucial juncture. Competition was heating up.
film. Salesmen carried a projector and a reel of Dishwashing
Retail giant Procter & Gamble had launched Spic & Span in
Dividends on sales calls, and it was viewed by public health
1947 and put millions into promoting it. Within a year of Spic &
departments, schools, restaurant managers and trade associa-
Span’s introduction, Soilax sales dropped 40 percent. Soilax
tions. Within ten years, this widely viewed training film was
recovered, but it was clear that Economics Laboratory was up
averaging 200 showings
against the giants in the
per month.
®
E.B. followed his film success with Flying Saucers, a film on
general cleaning market. But with Electrasol, the company had
how to prevent breakage, and Spotlight on Breakage, a film teaching
the upper hand in home dishwashing.
dishroom employees proper dish handling techniques.
E.B. goes Hollywood
E.B. Osborn’s belief in the power of visual selling made him
The first 25 years
quick to incorporate new techniques and technologies into sales
In February 1949, Economics Laboratory employees gathered
presentations. His first effort was in 1940, when he produced a
together to celebrate the company’s 25th anniversary at the
slide show at the United Airlines commissary at Chicago’s
Hotel Lowry in St. Paul. Mr. and Mrs. M.J. Osborn were guests
Midway Field. In 1946, he teamed with a New York motion pic-
of honor, and eight employees with more than 20 years of ser-
ture company to produce this early work, called Dishwashing
vice joined them at the head table. Among them were
Dividends, as a full-scale color
Company Secretary Ida Koran; Vice President and
film. This unique training film on institutional warewashing
General Manager E.B. Osborn; Vice President and
took such a soft sell approach that it contained no product refer-
Advertising Manager Steve Osborn; Stenography Depart-
ences. “We went so far as even changing the nameplate on our
ment Head Myrtle Shoemaker; Sales Correspondent
electronic dispenser when it was filmed so it read ‘detergent’
Isabel Sixl; General Sales Manager P.R. Evans; Office,
Credit and Purchasing Manager A.N. Larson; and Director
of Research Dr. John L. Wilson. As a gift for his 70th birthday, M.J. Osborn was presented with an “executive’s refrigerator” to match
his office furniture.
When he took the podium, Osborn spoke with pride of
the company which included 130 employees in St. Paul,
100 salesmen, and 100 manufacturing employees in
Chicago and Lyndhurst,
New Jersey. “You haven’t seen anything yet,
as far as Economics Laboratory, Inc., is concerned,” he
told the crowd. How right he was.
22
‘‘I liked the fact that it was a small
company, and you trained with a
salesman.’’ Al Schuman
CHAPTER 4: 1950-1959
BuildingBusiness
in
Postwar
America
In 1950, M.J. Osborn resigned his position as president of Economics Laboratory and passed responsibility on to his son, E.B. As chairman of the board, M.J. continued to actively participate in company management. But E.B. brought numerous changes.
Getting the house in order
I
to its existing locations in Chicago and Lyndhurst,
n the late 1940s, a group of salesmen broke away from
New Jersey. The company also divided its research department
Economics Laboratory to join a competitor, a former com-
into Analytical, Institutional Product Development, Consumer
pany employee. It was a major blow to E.B. but also a wake-up
Product Development, and Home Service,
call. Working from opposite ends of the country, E.B. and Sales
a departmental liaison that linked the consumer with
Manager Paul Evans visited, evaluated and retrained every
company headquarters.
Finally, Economics Laboratory moved its executive offices to
member of the salesforce in a drive to get back to the fundamentals that had built the company.
New York City in 1954. As E.B. reasoned, 80 percent of the
This “new religion,” as Evans called it, produced a strong new
company’s business was in the east. The major advertising agen-
sales and management team to drive the company’s two new
cies were based there. Air travel was becoming the preferred
mode of business transportation, and New York was a major
divisions to new heights.
transportation hub.
Growth and the need for greater
efficiency were driving reorgani-
New dairy division
zation in other areas as well. In
In 1950, Economics Laboratory
1953, the company added
turned to opportunities
a Santa Clara, California, plant
in the dairy industry,
a natural fit with the
> E LECTRASOL . Electrasol was
company’s institutional
a hit with homemakers in the growing
suburbs of postwar America.
dishwashing expertise.
At the time, dairy sani-
< C O L L A G E. Clockwise,
from top: Economics Laboratory
opened a dairy division in 1950; New
York skyline in 1957; intensive
research created new and improved
products.
tation was a major
industry problem.
Because of improper
25
CHAPTER 4: BUILDING BUSINESS
IN
POSTWAR AMERICA
< N EW D A I R Y DIVISION . Economics
Laboratory ventured into the dairy business
by washing milk cans and cleaning dairy
operations in the Upper Midwest. The company eventually
led the industry with its Clean-In-Place system, an automated cleaning system
that thoroughly cleaned dairy processing
systems at the touch of a button.
cleaning and refrigeration, a quart of milk had a refrigerated
dark green china was prone to water spotting. The system elim-
shelf life of three days at best. Furthermore, traditional cleaning
inated water spots and dried the dishes instantly, so the restau-
methods caused milk cans to corrode quickly.
rant manager called M.J. Osborn to rave about it. “Start making
Economics Laboratory devised new products and equipment
those things as fast as you can,” said Osborn after seeing the
that delivered superior results. Soon the company was looking
equipment demonstration.
for salesmen to build a new Dairy Division focused on
The new RP3 system was designed to inject revolutionary
Minnesota, northern Iowa and western Wisconsin. “Most of the
new Rinse Dry into final rinsewater. The Rinse Dry
dairy industry was in the small towns and rural areas,” recalled
system was exhibited at the National Restaurant Show in
Fred Lanners. “As the dairy division expanded, we found that
Chicago in 1953 to great industry acclaim. Soon Economics
there wasn’t any coverage there by our Institutional men. So we
Laboratory was selling dispensers at $495 apiece, a radical
got the bright idea, we might as well sell our Institutional prod-
departure from the company’s traditional practice of providing
ucts.” Combination territories were formed and Economics
free equipment.
Laboratory extended its reach into America’s hinterlands.
Rinse Dry was a highly profitable product. “It was
really about that point when we started making money,” said
Research takes off
Lanners.
Growing use of molded plastic dinnerware by institutions in the
1950s was presenting a range of dishwashing challenges – and
Consumer Division comes on strong
opportunities. Coffee staining was one problem. Abrasive
By 1953, Economics Laboratory’s leading automatic
cleansers destroyed the plastic’s surface. The company’s solu-
dishwashing detergent, Electrasol, was competing with
tion was Dip-It, a chemical bath that lifted out coffee stains from
Calgonite, and the company was conducting lab tests
plasticware and coffeemakers without corroding or abrading the
to improve the Electrasol formula.
surface. Dip-It became a leading product in hotels and restau-
Adding chlorine to the dishmachine cycle dramatically
rants. In 1952, it was packaged for home use and sold through
improved cleaning results. But all drip bleach dispensers cor-
grocery stores.
roded the dishwashing machine. When
Neither glass nor plastic dinnerware
the lab developed a formula using dry
dried readily in high-speed dishwashing
chlorine, the results were outstanding.
machines. Restaurants needed to wash
“We developed the first stabilized chlo-
dishes fast and stack them dry and unspot-
rine detergent formula which we called
ted. So in 1954, the company introduced
#221,” recalled Bill Podas. “We worked
the first rinse injector equipment to accom-
with the Hotpoint laboratory in
pany its other recent industry break-
Chicago, and they liked
through – rinse additives.
our new formula very much.
The products were tested at The
Golden Rule restaurant in downtown St. Paul, whose expensive
25
CHAPTER 4: 1950-1959
< D IP - I T. Plastic dinnerware gained popularity in the
1950s and presented new product opportunities for
Economics Laboratory. Dip-It, a noncorrosive chemical cleaner that safely removed
coffee stains from plastic cups and coffeemakers, was a
hit with institutions and consumers alike.
> F INISH PA C K A G I N G. Economics Laboratory
added a second automatic dishwashing detergent brand
in 1953. By adding chlorine to the
wash cycle, the new Finish improved cleaning results
without corroding the dishwasher.
Economics Laboratory goes international
Hotpoint recommended that we change our Electrasol
formula to #221. We were concerned because the cost of pro-
By the early 1950s, Economics Laboratory products were
ducing the new formula was 50 percent higher than
in demand outside the United States. Many inquiries came from
the cost of the existing Electrasol. E.B. conceived the idea
Canada, and an Institutional salesman in Buffalo, New York,
of a second brand, and he had a name – Finish.”
began to service a few accounts across the border. By 1955, there
was enough business in Canada to form a sales territory, and the
Hotpoint gave Finish a ringing endorsement and
helped launch it. “We ran off 50,000 copies of a letter to
company contracted with a Canadian manufacturer to produce
Hotpoint dishwasher dealers and distributors coast to coast,”
Economics Laboratory products for the new area.
In 1954, Olaf Stark, then general manager of passenger flight
said Podas. “This led to grocery distribution, and Finish
appeared next to Electrasol on the grocer’s shelf.”
services for SAS worldwide, discovered Economics Laboratory
It became a million-dollar product in its second year.
while visiting the SAS flight kitchen at New York’s JFK
In 1955, the company introduced its rinse additive to
Airport. Impressed with the products, Stark put up $2,000 for 10
the consumer market under the name Jet-Dry and convinced
percent of a new venture in Stockholm, Sweden, and Economics
General Electric to build rinse injectors into home dishwashing
Laboratory invested an additional $18,000. The subsidiary,
machines. Soon, Electrasol, Finish and Jet-Dry were the prod-
Soilax A.B., Sweden, became Economics Laboratory’s first
ucts homemakers looked to for dishwashing perfection.
European subsidiary in 1956.
This opened the door to the world. With a budget of
Consumer product expansion followed quickly.
The company acquired Essential Chemical,
$70,000, Fred Lanners was instructed to
Inc., of Milwaukee, and its product called
develop international operations throughout
Fun, a controlled sudsing laundry detergent.
Europe. From Sweden it was an easy step to
Strong competition from All hampered suc-
Norway, Denmark and Belgium. Travel stops
cess, so the company turned to other opportu-
through London led to a subsidiary
nities. Soon it was brokering consumer
in England, then the rest of Western Europe.
®
International operations generally adopted the
products includingRed Bear copper
™
™
cleaner, Ammident toothpaste and Kiwi
™
Soilax name because Economics Laboratory
was too difficult
shoe polish.
to pronounce, and it didn’t translate well.
In the Western Hemisphere, business was
also opening up. In 1958, a New York sales< R I N S E DRY. Wet dishes and water spotting
man moved to Mexico City to service U.S.
on china were a continual problem for restaurants
until Economics Laboratory introduced the Rinse Dry system at the National Restaurant Show in Chicago in 1954.
hotel chains. This led to the formation of
Soilax de Mexico. S.A.Venezuela followed,
> F I N I S H A D V E R T I S I N G . In the 1950s, most of the
along with a multitude of countries. Soilax
advertising budget for the company’s Consumer Division
products went into print advertisements in women’s magazines.
became a truly international product.
26
CHAPTER 4: BUILDING BUSINESS
IN
POSTWAR AMERICA
< F R E D L ANNERS . Fred Lanners established
Economics Laboratory’s first European
operations in the mid-1950s. He was
named president and CEO in 1961.
> N EW
S A L E S TERRITORY IN
C ANADA .
In 1955, Economics Laboratory opened its first international sales territory in eastern Canada. Fred Lanners,
then head of International Operations, formally
announced the opening.
A solid sales approach
like there wasn’t anybody I couldn’t sell, because it was
In the midst of dramatic growth and expansion, the
so simple the way that E.B. taught it to us.”
In 1957, Al Schuman was one of the Institutional Division’s
company’s two-tiered sales system remained the same throughout the 1950s. Each person came on board as a junior salesman,
new junior salesmen. “I liked the fact that it was
paired with an established salesman for 18 months. The junior
a small company, and you trained with a salesman,” he said. For
salesman traveled with his senior partner, learning what to do
the first two years, he spent every Saturday afternoon
and why. The senior salesmen introduced the new man to key
at his supervisor’s house, learning about products and ways to
customers and gave him leads. He also contributed to the
sell them. Two years after being hired, he was promoted to terri-
junior’s salary, and the company made up the difference. In
tory manager.
return, the senior man got a low cost assistant.
Spreading the word on Soilax
Intensive training kept the senior salesman sharp and helped
the junior get up to speed quickly. For the first month, the
In 1956, consumer advertising for Soilax reached 33 million
junior spent every day with his senior partner. After about 90
homes, two-thirds of the nation’s households. Sales promotions
days, most new salesmen were on their own. Most territories
like the Soilax Derby aired on local radio stations. A bugle call
split at the end of 18 months, with enough business for both.
signaled the start of the Soilax Derby race. The first woman to
“That’s the way our company ran our Institutional Division for
get to the grocery store and holler “Soilax!” got a free package.
the first 20 years,” recalled Larry Hodges, former senior vice
“It worked pretty good for a while,” said Steve Osborn. “It got
president, who joined in 1950.
to the point where women would get into a dispute as to who
was first. And of course the grocer didn’t like to argue with the
Planning and reporting were part of every salesman’s daily
women. That was the end of that.”
regimen. “We had a little route book at E.B.’s insistence.
Imaginative institutional salesmen were given a wide berth
Salesmen were instructed to make up a work plan every night
for the next day,” said Hodges. Salesmen also had demonstra-
in promoting company products. “When I was a salesman in
tion and sales technique instructions. “I felt
New York, I made my own cards that said
‘Al Schuman, the Soilax Man in Queens,’” he said. Schuman
also drilled holes in the roof of his service
truck and attached a “Product of the Month” display.
DE M E X I C O . Economics Laboratory opened an office
in Mexico City in the late 1950s, forming Soilax de Mexico. Since
the company’s name was difficult to translate, international offices
generally took on the Soilax name.
< S OILAX
> C AP T H E D OG . Master salesman Ulysses S. Grant attracted lots
of attention at institutional trade shows with his dog, Cap. The friendly black lab frequently made the rounds with a bucket of Soilax samples.
27
CHAPTER 4: 1950-1959
< A L S C H U M A N , J U N I O R S A L E S M A N.
A hardworking and innovative young
man named Al Schuman joined Economics Laboratory as
a junior Institutional salesman
in New York’s Queens borough in 1957.
GOES P U B L I C . In 1957,
Economics Laboratory conducted an
initial public stock offering to generate the
capital needed to support company growth.
The transition to public ownership signaled
a new era in company management.
> EL
Veteran salesman Ulysses S. Grant was one of the most
private sales of common stock, several issues of preferred
inventive. In his home workshop, Grant built an Economics
stock, mortgages and bank borrowings. “In those days,
Laboratory display for trade shows at his own expense.
you had to write to M.J. and tell him you wanted to buy some
He draped the booth in black velvet and attached a Soilax logo
stock, and then you went on a waiting list,” said Ken
in glittering rhinestones. He took his black Labrador retriever
Markwardt, former senior vice president of finance, who
Cap to trade shows. Cap carried a bucket of Soilax samples to
bought his first 10 shares in 1953. “If he approved of you, then
each attendee and waited until the person took a sample. Then he
you could buy some.”
wagged his tail and moved on. Trade show invitation replies often
In 1957, all that changed. With annual sales of $28 million and
included the postscript: “Please have Mr. Grant and his dog Cap
a net worth of approximately $3 million, Economics Laboratory
present.”
went public with an offer of 100,000 shares
A live duck Grant used to demonstrate the effectiveness of a
at $15 per share.
new wetting agent was also a popular draw. When Grant put
The company needed the money to grow and also to buy a
additive into the water tank, the swimming duck sank, amazing
product called Soil Off for $1 million from the SOS Company.
onlookers.
The banks had balked on a $1 million loan,
In St. Paul one year, Grant joined a parade down Kellogg
saying Economics Laboratory’s ratio of debt to earnings was too
Boulevard for “Clean Up and Paint Day.” He covered his car
high, and there wasn’t enough cash in reserve.
with crepe paper and installed a chair on top where Grant’s wife
The public offering gave the company the money it
Helen sat, throwing Soilax samples to the crowd.
needed. Unfortunately, new liquid detergents introduced
by competitors quickly captured the market, and Soil Off
Economics Laboratory goes public
foundered. Within a few years, it was abandoned.
Until 1956, Economics Laboratory was owned by the Osborn
family, company employees and several private investors.
Decade’s end
Growth had been financed through periodic
Economics Laboratory ended the decade with 1,000
employees and sales of nearly $30 million in three company divisions – Institutional, Consumer and Industrial,
which incorporated dairy and other new markets. The
company occupied offices in New York and six floors in
downtown St. Paul’s Guardian Building. A separate
mechanical manufacturing facility operated on St. Paul’s
Como Avenue. And the company produced products in
a fully automated new Chicago facility and in plants in
New Jersey, Dallas, Toronto and California. International
operations were expanding rapidly. The company was
poised for another decade of growth.
28
Our company has enjoyed
record growth and successful
operations for more than forty
years.’’
‘“
CHAPTER 5: 1960
TO
1969
Mastersof
Innovation
When Merritt J. Osborn died in January 1960, the company he had founded was a powerhouse of scientific
sanitation. With 1,000 employees and nearly $37 million in sales, Economics Laboratory, generally known
as EL, served 60,000 U.S. customers through a network of more than 450 salesmen in 16 district sales offices.
Six plants in the U.S. and Canada manufactured EL products, which were trucked to customers from 80
warehouses scattered throughout the country. Subsidiaries in foreign countries were spreading the Soilax name
worldwide. The Institutional Division still anchored the company and generated 65 percent of annual revenues.
The Consumer Division contributed another 30 percent and a start-up Industrial Division was making inroads
in dairy and industrial cleaning. “We are not flying any longer by the seat of our pants,” said E.B. Osborn in a
1960 message to the sales force.
Acquisitions fuel company growth
E
Klenzade’s pioneering development of Clean-In-Place (CIP)
L had taken tentative steps into the dairy business
cleaning was the most exciting aspect of the acquisition. The
in the late 1950s. In 1961, the company acquired
CIP system eliminated the need to break down and hand wash
Klenzade Products, Inc., an established leader in dairy
dairy plant pipes and valves. EL’s timed and controlled rinses
plant cleaning and sanitizing. With Klenzade, EL acquired 90
and cleaning solutions, forced through a CIP pipe system,
technical sales and research personnel, a new 80,000-square-
allowed a dairy plant operator to clean miles of pipes with the
foot manufacturing plant in Beloit, Wisconsin, licensees in Italy
push of a button. Klenzade’s CIP system spread to dairy farms,
and Mexico and distributors in Canada and Puerto Rico.
dairies, meat and poultry plants, bottlers, breweries and canners.
“Klenzade had a national sales force
The aseptic filling techniques Klenzade developed to combat
and a complete line of products,” said Ken Markwardt. “We
bacteria in
were able to integrate
the 10 or 12 territory
managers
we had in our Dairy
Division into the new
Klenzade Division.”
< K L E N Z A D E . Klenzade Products,
Inc. was a leader in dairy sanitation when it
was acquired by Economics Laboratory in
1961. The company renamed its Dairy
Division the Klenzade Division to capitalize
on Klenzade’s established reputation.
CHAPTER 5: MASTERS
OF
INNOVATION
< K L E N Z A D E ’ S O R I G I N A L F ACTORY . The
Klenzadeacquisition brought Economics Laboratory a new
80,000-square-foot manufacturing facility
in Beloit, Wisconsin, the dairy heartland.
> K L E N Z A D E L UBRICATING P R O D U C T S. By
the mid-1960s, Klenzade technology was being applied to
a wide variety of food processing applications. The KlenzJect system, shown here, provided controlled, continuous
lubrication and cleaning
of food conveyer systems used to produce citrus products,
baby food, frozen pies and other foods.
us that you couldn’t mix chlorine with a caustic because the
milk were later applied to bottled and canned draft beer and
two of them would blow up or something,” said Larry Hodges.
fruit juice, dramatically improving flavor and shelf life.
“But they did develop a way to put both ingredients into the
After the Klenzade acquisition, EL explored opportunities in
same barrel. And those products were Impact and Score.”
aviation, transportation cleaning, metal processing and the
It took a solid year of development, testing and modifica-
paper industry to develop its small Industrial Division. The new
direction culminated with the 1964 acquisition of Magnus
tion, followed by a process to fine tune production
Chemical Co. Inc., of Garwood, New Jersey, a leader in marine,
and packaging before Score was market ready. Advertising and
aviation and industrial cleaning. Magnus’s three plants and 22
promotion, including the movie, “The Score Story – Research
international, independently owned licensees bolstered EL’s
& Development of Machine Warewashing,” backed up the
global presence. “Its customer list reads like ‘Who’s Who’ in
sales force.
A revolutionary new defoamer was another breakthrough.
American industry, and its direct sales effort is backed by 160
trained men,” said E.B. Osborn in 1965. That year, the division
“Pump and spray action creates a lot of foam
hired a four-man team of retired Army Aviation Board members
in the dishwashing machine,” said Bill Mizuno, who
to tap the military market. EL also acquired Magnus licensees in
was hired in 1943 as a scientist. “Air gets into the pump,
Hawaii and Norway and purchased a 50 percent interest in
you lose pressure and you get very poor dishwashing.
Magnus Brazil.
The defoamer suppresses the foam so you won’t have
the pump lock problem.” Salesmen began carrying eye drop-
Smaller EL acquisitions included the Moran Company, a
small Dallas dishwashing compound business, and J. Nelson
pers of defoamer on calls to quench foam in front
Prewitt, Inc., a consumer products company in Rochester, New
of the customer.
Like product innovation, service continued to differentiate the
York. Matey, a bubble bath for children, was Prewitt’s major
product, but it didn’t succeed. After two years, EL wrote off the
company, and in the mid-1960s, EL put a name on it. “It is the
$150,000 loss on the Prewitt investment.
company’s objective and constant aim to render to our customers
what we like to call ‘Total Responsibility’
Products and service differentiate EL
Early in the decade, EL’s new liquid products were
replacing powdered, general-purpose cleansers
like Soilax. In 1963, EL achieved another cleaning breakthrough. “The R&D guys had always told
< C OLLAGE . Page 28, Clockwise from top: Salesman
Al Schuman at the 1964 World’s Fair; Construction
of the Osborn Building in 1967; Bulk chemicals
used in Economics Laboratory products.
> I MPACT A N D S CORE . In the 1960s, liquid
commercial cleaners combining chlorine and highstrength alkali and polyphosphates replaced traditional powdered
detergents as the institutional cleaners of choice.
31
CHAPTER 5: 1960
TO
1969
< S O I L A X PAMPHLET. During the 1960s,
the International Division became a significant contributor
to the company’s growth and success. Advertising and
promotional materials reflected this important new market emphasis.
> S A L E S M A N , V E N I C E , I TALY . Dressed in
his white lab coat, an Institutional Division
territory manager in Venice, Italy, unloads
his gondola on the way to a service call.
for end satisfaction with the product and its benefit,”
Upgrading manufacturing
said E.B. Osborn. This approach required salesmen
EL expanded and modernized plant facilities throughout the
to work with senior reps for two years to develop their
1960s. In 1960, the outdated Santa Clara and Glendale opera-
technical knowledge of products, equipment and on-the-spot
tions were consolidated in San Jose, joining operations in
trouble shooting before getting a territory of their own. The
Chicago, Dallas, Lyndhurst and Toronto. Klenzade and Magnus
extended apprenticeship made EL salesmen experts in their
added manufacturing facilities in Beloit, Wisconsin, and
specialized fields with a professional approach to servicing
Garwood, New Jersey. A third New Jersey plant – in
accounts.
Woodbridge – was completed in 1967.
Magnus channeled efforts into three areas – metal working,
Reducing freight costs was a major concern. “We were ship-
transportation, and pulp and paper. Klenzade developed a “Total
ping a heavy product and needed locations throughout the United
Cow Care” system for the dairy farm market. Institutional
States, ” said Ray Wheeler, former vice president of manufactur-
launched the “Utility Man” program to cross-train dishwashers,
ing and quality assurance. “We debated whether we should
porters and other foodservice sanitation workers in related jobs.
have a lot of small satellite plants or whether we should have
The program improved efficiency, productivity and worker
fewer large plants.” The company chose the latter.
retention.
EL also began to buy chemicals in bulk. “Before, everything
was in bags and drums and manhandled,” said Bill Beyer. “We
International rides growing economy
would have two guys on fork trucks for an hour-and-a-half and
A worldwide improving economy helped the International
two or three guys piling the bags. Then we started getting bulk
Division expand dramatically in the 1960s. EL established
chemicals blown in. The guy backed
a subsidiary in France in 1962 and acquired an Italian company
in his truck, hooked up and pumped it in. When he pulled out
the following year as part of the Klenzade acquisition. At the
we had a tank full. It cut our costs tremendously.”
same time, EL established operations in Southeast Asia,
Contract packaging also generated cash to upgrade plants
Australia, New Zealand and Japan.
and equipment. EL’s first contract was for Snowy Bleach, fol-
In 1963, EL products were distributed worldwide through
lowed by Sta-Flo and Sta-Puff laundry starches.
direct exports, 10 subsidiary and 15 distributor operations.
“It allowed us to buy better, higher speed equipment than we
Soilax was a registered trademark in 40 countries and pending in
would have been able to justify without those contracts,” said
12 others. EL broke ground for a production plant in Stockholm,
Wheeler. Automatic bottle packing for Sta-Flo slashed labor
Sweden, the first plant outside
costs. Computerized pallet storage increased efficiencies. By the
the Western Hemisphere. Division management moved from
late-1960s, the company was saving on bulk materials, bulk
Toronto and St. Paul to the company’s executive offices in
handling and fast, modern packaging equipment. Detailed bud-
New York.
geting and review by the Data Processing Department enabled
By 1969, International consisted of 27 wholly-owned
EL to control costs and expenses. Quality assurance labs added
subsidiary operations, 50-percent-owned companies in
to plants helped
Brazil and Japan, 11 licensees and numerous distributors
EL improve product quality through on-site testing.
in the Caribbean and Southeast Asia. International was
now contributing healthy earnings.
32
CHAPTER 5: MASTERS
OF
INNOVATION
< F I R S T C OMPUTER . The enormous size
and weight of early computers made
installation extremely difficult. In 1959,
the company’s first computer was lowered
into St. Paul headquarters by helicopter.
> B I L L M I Z U N O, S CIENTIST. Bill Mizuno joined
Economics Laboratory as a chemist
in 1943. During his long career, he invented
or co-invented 49 products that received
United States or foreign patents.
Emerging technology
lations designed to protect the public against food and environ-
In the early 1960s, electronic technology was still in its infancy.
mental contamination. By the mid-1960s, EL was actively
Each day, a typical company headquarters switchboard operator
researching biodegradable detergents with public health groups,
placed about 20 long distance calls and received 40. Direct long
chemical manufacturers, trade associations and government
distance dialing was being phased in.
regulatory agencies, and modifying raw materials and products
to meet industry standards.
Even so, EL was quick to embrace new technology. In 1959,
Biodegradability was resolved and water contamination took
the country’s first solid-state Remington Univac computer was
installed in the St. Paul offices. In 1961, the Data Processing
its place. In 1967, E.B. Osborn and Vice President of Research
Department was formed to control inventories and receivables.
Bill Podas met with cabinet members of President Lyndon
In 1966, EL installed 14 IBM 360 computers in its Guardian
Johnson’s administration to study the deterioration of America’s
Building headquarters “The capabilities of the system and the
lakes, and Podas was named to a federal task
speed with which it operates are hard to comprehend,” reported
EL Today. The system produced 300 punch cards per minute.
Research efforts expand
By 1960, EL’s research department held more than 50 patents and
employed about 200 people. “We had Ph.D. chemists all
around, microbiologists, physicists and engineers,” said Bill
Podas. That year, EL purchased 29 acres in Mendota Heights to
build a new research center.
In 1962, the company completed a $500,000 pilot
plant on the new site. Two years later, the Merritt J. Osborn
Research and Development Center opened. The 50,000-squarefoot facility included an environmental test chamber, instrument
room, microbiology laboratory and test unit and a complete technical library. By the time EL completed the $400,000 mechanical plant, it was time to expand.
EL renewed its emphasis on general and fundamental
research. An active organic synthesis program enabled EL to
create tailor-made molecules. Pure research also allowed EL to
meet the new wave of federal, state and municipal laws and regu-
> O S B O R N B UILDING . The 22-story Osborn Building dominated
St. Paul’s downtown landscape when it was completed in June 1968.
The building was constructed primarily of stainless steel, glass and
polished black granite – chosen for superior cleanability.
33
CHAPTER 5: 1960
TO
1969
< M.J. O S B O R N R E S E A R C H &
D E V E L O P M E N T C E N T E R. The Merritt
J. Osborn Research and Development Center,
a state-of-the-art research facility named in honor of the
company’s founder, opened in 1964
in the St. Paul suburb of Mendota Heights.
> O S B O R N BU I L D I N G DEDICATION .
Economics Laboratory President and CEO
E.B. Osborn, right, joined St. Paul Mayor Thomas R.
Byrne at the podium for the
dedication of the Osborn Building in June 1968.
force researching pollution problems and solutions. “We are
executive suite and employee cafeteria. A modern data process-
involved in this problem, because we are concerned not only
ing center was equipped to communicate with the company’s
with making and selling chemical products,” said E.B. Osborn,
110,000 customers worldwide, process 50,000 monthly invoices
“but also with what goes down the drain.”
and process payroll checks and tax forms for EL’s 2,500
By the late 1960s, about 200 projects in basic research,
employees.
equipment engineering, product development and pilot produc-
It was also the first high-rise in the Midwest equipped with the
tion were routinely underway. The process included product
Vertical Improved Mail postal system, a postal control station in
development, customer panel testing, three district market tests,
the basement complete with vertical mail conveyors. The build-
pilot plant scale up, area expansion in one plant, national distrib-
ing’s cost, including furnishings and original art, was $9 million.
ution and quality assurance testing.
A grand opening event was held on June 19, 1968, with E.B.
On-site testing in institutional and home environments was
Osborn, St. Paul Mayor Thomas R. Byrne and other city officials
still a vital part of consumer product development. Home
presiding. “From the outset, I was resolved that the Osborn
Service Supervisor Dorothy Wood and Home Economist
Building should project a special quality of cleanliness, an
Joanne Huseby traveled the country to interview EL product
atmosphere of hygiene, that would speak for the world leader in
consumers and worked with 500 Twin Cities homemakers serv-
environmental sanitation,” said E.B. Osborn. The Osborn
ing as testers for new EL products. The two home economists
Building’s “cleanability” received national coverage in Time
also personally responded to more than 100 letters each month.
magazine and became a corporate symbol.
“There were no individual cubicles and telephones,” said
Osborn building is a monument to
Alice O’Connor, who joined the Data Processing Department
sanitation
soon after the opening. “Desks were lined
“The decision to build our new administration building
up in one big room, with one phone for each department and
in St. Paul was not difficult to make,” said E.B. Osborn at
extension cords all over the place.”
a press conference in 1965. “Our company has enjoyed record
growth and successful operations in this city for more than 40
Decade’s end
years, and we have a sentimental as well as
Near the end of the decade, EL was producing more
a practical attachment to this community and its people.”
than 500 products, including organic raw materials,
bulk powders, liquids and packaged goods. In 1969, a
Construction of the Osborn Building began on January 24,
1966, directed by Architect Clark Wold. Workers topped it off at
sale to the McAlpin Hotel pushed EL over $100 million
13 stories but EL management decided to add another seven sto-
in sales. That June, the over-the-counter Market Edition
ries. The completed structure was a tower of stainless steel,
of Commercial and Financial Chronicle listed Economics
glass and polished black granite, encircled by a reflecting pool.
Laboratory as one of the 200 fastest growing U.S. companies.
Its 22 stories included two sub-street floors and 270,000 square
feet of space, including an expansive lobby, general offices, an
34
CHAPTER 6: 1970-1979
Joining
theGiants
In 1970, EL was first recognized as a major corporate force. Earnings had grown nearly 20 percent annually
between 1960 and 1970, placing it eleventh in earnings growth on the Standard & Poor’s ranking of publicly
owned corporations. The company had an unbroken record of dividend payments stretching back to 1937.
T
he turbulent decade brought worldwide recession, mount-
The management shift accompanied a flurry of acquisitions.
ing inflation, high interest rates and escalating prices on
EL acquired Star Filter Company, a Detroit-based manufacturer
raw materials and freight. EL adapted by raising product prices
of coffeepot filters; Tykor, a specialty
and improving manufacturing efficiencies and worker produc-
chemicals division of Borden, Inc.; Prodilac S.p.A., a
tivity. Lights were turned off and thermostats adjusted to con-
leading Italian consumer detergents company, and the remain-
serve energy. Distribution warehouses were expanded and
ing interest in its Brazilian joint venture.
inventory control and management information capabilities
Another key acquisition was Raburn Products, Inc.,
added. And EL continued to thrive by helping customers lower
of Wheeling, Illinois, manufacturer of transport carts and dish
costs, conserve resources and improve safety and efficiency. In
racks for institutional warewashing. The Raburn acquisition
1975, EL squeezed onto the annual list of Fortune 500 compa-
became the foundation of the Institutional Division’s special
nies, ranking 500.
purpose equipment operations, which was later anchored by a
state-of-the-art manufacturing facility in
Fifty year anniversary
Elk Grove, Illinois. Following its acquisition, EL gradually
EL celebrated its fiftieth year in 1973. That year,
extended Raburn’s product offerings from standard molded dish
the company achieved its 39th consecutive
racks and silverware systems to a wide variety of custom-
year of growth in sales and earnings, introduced
designed and color-coded warewashing and storage
more than 100 new products and expanded
systems. Raburn Equipment also extended
production capabilities in eight foreign
EL’s expertise to a multitude of safety and
countries. The year also brought new
senior management. E.B. Osborn relin< E COLAB ’ S 50 TH A NNIVERSARY .
quished the presidency to Fred Lanners,
EconomicsLaboratory celebrated its long history of service excellence during its 50th anniversary year. “Service
is Golden” was the theme for the year and was highlighted
in the company’s annual report.
who had joined EL in 1948. Osborn
retained his position as chairman of the
board and CEO.
< C OLLAGE . Clockwise from top: Developing new
products through research; supervised cleaning provided
by Environmental Sanitation Services; the company’s
Distinguished Service Award.
37
CHAPTER 6: JOINING
THE
GIANTS
< EL R ECOGNITION . By the 1970s,
Economics Laboratory’s logo was a
recognized corporate symbol.
> M O V E F ROM M ANHATTAN. In 1971,
Economics Laboratory moved its executive
offices from 250 Park Avenue in Manhattan
to the suburb of Harrison, New York, near
White Plains. The move cut commuting time
for most employees, which was a welcome relief.
sanitation compliance solutions for commercial foodservice
equipped to handle problems with every one. Eight dispatchers
providers and laundries.
in Memphis handled 300 calls a day through a toll-free number,
EL broadened its industrial capabilities by acquiring the
freeing up the respective sales forces.
Maritec Companies, a group of companies specializing in cleaning chemicals for the international shipping trade. The acquisition
Guarding public safety
produced a new EL subsidiary, Magnus Maritec International,
Throughout the 1970s, EL researchers worked closely with field
Inc., based in Palisades Park, New Jersey.
specialists, government officials, university experts and public
groups to grow the business and serve the public need for sani-
Growing use of new, no-iron, permanent press fabrics for
table linens, bed linen and uniforms created another market
tation and safety. Environmental concerns remained a major
opportunity for the Institutional Division. EL acquired Fraser
research focus. Phosphates, a major component in EL products,
Laundry Systems, Inc., of Memphis, Tennessee,
were under scrutiny in the early years,
the nation’s only established institutional laundry
and in 1971, EL discovered the means
business. It also acquired certain assets of
to reduce phosphates in EL products.
Hammond Industries, Inc., of Waco, Texas, manu-
“This new development provides the
facturer of Fraser Laundry machines. By the mid-
company with a new raw material base
1970s, EL was manufacturing and selling laundry
from which we
equipment, detergents and dispensing systems
can develop a whole new family of for-
through its new Econ Systems Division.
mulated products, thus permitting us to
position our entire product line to meet
New services were being formed to capture new markets. EL launched
evolving environmental standards,”
Environmental Sanitation Services to
said E.B. Osborn. Raw materials short-
hire, train, supervise and schedule
ages necessitated modification of scores
kitchen, janitorial and laundry crews
of product formulas to guarantee avail-
in large restaurants, hotels and hos-
ability
pitals. An Equipment Engineering
to customers.
By 1973, the Merritt J. Osborn
Division was formed to market CIP
systems to Magnus, Institutional
Research Center had doubled three
and Klenzade customers. EL
times since opening in 1962, and
formed a Service Division to pro-
EL had a new Chemical Engineering
vide equipment repair and preven-
Facility in Eagan, Minnesota. Two
tive maintenance to Institutional
years later, EL opened its first satellite
and Econ Systems customers.
research center in Rio de Janeiro,
More than 40 different manufac-
Brazil, then followed with labs
turers made EL equipment, and
in Belgium and New Zealand.
Service Division personnel were
37
CHAPTER 6: 1970-1979
< E CON S YSTEMS DIVISION .
The development of synthetic fabrics made
on-premise laundry operations affordable
for many of EL’s Institutional customers. Recognizing an
opportunity, the company
became an early leader in this growing business.
> E C O -T E M P. Research breakthroughs
in chemical sanitation enabled EL to save
energy and reduce customer costs through
Eco-Temp, a low-temperature dishwashing
program introduced in the late 1970s.
tion specialist. A team visit to a customer yielded in-depth
The Research Department also began marketing directly to
customers in 1973 through its Capsule Consulting Service.
analysis of all processes and
Capsule, short for Consultation on Aseptic Practices and
procedures, along with suggested improvements to help reduce
Uniform Sampling of Equipment, provided high level technical
energy and labor costs.
But Institutional continued to lead the company in marketing
services to the healthcare and food processing markets.
innovation and sales strength. With an obvious need to serve the
New sales strategy
ever-broadening national hospitality and restaurant chains, the
EL restructured its sales organization early in the decade. Left
division created a new National Accounts Team in the 1970s.
behind was the junior-senior system that had built the company.
This special group of account representatives extended EL’s
In its place was a new “one-eight” system, which assigned eight
market reach by selling to corporate headquarters of the grow-
sales associates to a district manager whose main responsibility
ing multi-unit food and lodging chains. As the major chains
was sales training. The new approach solved a nagging problem
moved into global markets,
with the old system – good sales people were not always good
EL went with them. In time, the National Accounts Team
trainers. EL began the 1970s with 35 districts and ended it with
nearly 100.
< R ABURN R A C K S . EL’s acquisition of Raburn Products, Inc.
Substantial increases in manpower and additional training
evolved into a highly profitable institutional equipment, storage
and compliance operation called Raburn Equipment.
continued through the decade. In 1979, EL embarked on a marketing technique called team selling, drawing on the expertise of
> E NVIRONMENTAL S ANITATION S E R V I C E S. Environmental Sanitation
Services, initiated in 1975, provided EL customers with trained personnel to handle
warewashing, bussing, laundry and
general maintenance.
numerous specialists. A Klenzade team, for example, included a
hydraulic and process engineer, food microbiologist and sanita-
38
CHAPTER 6: JOINING
THE
GIANTS
< F REE ‘ N S O F T. A packet of Free n’ Soft
was filled by high-speed equipment. The
successful consumer product was developed
to work as a fabric softener in the clothes dryer.
> G UARDIAN S YSTEM . The Guardian
System, introduced in 1976, produced
consistent, sparkling-clean results at a lower
cost per dish than traditional methods. Its safety and
ease of operation revolutionized the industry.
evolved into the Global Accounts Team, providing consistency
Finish, and both liquid and solid Jet Dry were leaders. Lime-A-
and quality in products, systems and service to locations
Way, a specialty bathroom and kitchen cleaner formulated to
throughout the world.
eliminate lime and scale deposits, was an instant hit. Free ‘n
Instrumental in the conception and development of
Soft, the first in-dryer softener,
the National Accounts Team was Al Schuman, the young junior
was another Consumer breakthrough. “The static buildup on
salesman hired in 1957, who would someday take the reins of
synthetic clothes was making people get zapped as they took
the company. The concept, like many of EL’s, again proved rev-
clothes out of their dryer,” said Mizuno. “We developed it to fill
olutionary in the industry.
that need.”
Energy and resource conservation was an important focus in
Product proliferation
the Industrial and Klenzade markets. Magnus developed prod-
In the early 1970s, EL offered more than 900 products and more
ucts to recover pulp fibers for recycled paper making, processed
than 100 new and reformulated products were marketed each
waste oil for reuse, and developed synthetic lubricants that
year. EL had a third of the consumer market with Electrasol and
lasted a year instead of
two weeks. Klenzade’s Dy-Gest cleaned dairy plants and equipment at low temperatures, and new MP 1800 microprocessors
allowed plant operators to precisely control
CIP cleaning cycles and recapture milk clinging to pipes and
silos. Aseptic meat cutting techniques helped extend the shelf
life of packaged meats from 10 to 40 days. Klenzade’s new noniodine teat-dip called Blu-Gard became the hottest new product
in the dairy business.
But EL’s Institutional Division remained the company’s
product leader by a wide margin. In the early 1970s, EL offered
both powdered and liquid automatic dispensing systems for
institutional warewashing. In 1976, EL took institutional warewashing to a new level with the revolutionary Guardian System.
Highly concentrated Guardian System detergents provided better results while conserving energy. And a new safety dispenser
with solid-state electronic controls precisely delivered detergent
to the commercial
< P R O D U C T PROLIFERATION . Economics Laboratory marketed
a broad line of successful household brands in the 1970s.
> A S I A N M ARKET. EL conducted intensive on-site research and
testing in Asia, Europe and other areas to guarantee superior product
performance in local markets.
39
CHAPTER 6: 1970-1979
< E C O -L I N E . Demand for convenient,
one-stop shopping sparked the growth of the
food distribution industry in the 1970s.
EL responded with Eco-Line warewashing,
laundry and housekeeping products to reach
these new wholesale customers. The program was the
forerunner of today’s Distributor Programs.
dishmachine in proper proportion. “The concept of the Guardian
International reaches 50 countries
dispenser was to have a prepackaged product that you could put
In 1970, ten years after it was officially set apart as a new divi-
into a dispenser without handling it,” said Mizuno. “One of the
sion, International Division sales exceeded $30 million and it
key factors that started the program was safety in handling prod-
served more than 40 world markets. The division returned its
ucts.”
International Operations offices to Minnesota, established a
Two programs initiated in the 1970s – Eco-Temp
European satellite headquarters office in Brussels to guide
and Eco-Line – became important contributors to the Institu-
efforts in 15 countries and added new operations in Spain,
tional Division’s success. Eco-Temp began in 1976, when the
Switzerland and the Dominican Republic. In 1977, International
Institutional Division first began to purchase low-temperature,
set up area headquarters in Latin America and Hawaii. By the
large-capacity dishwashing machines from the manufacturer
end of the decade it conducted business in more than 50 coun-
and rent them to customers. Through chemical sanitizing, the
tries.
machines could wash dishes at 140 degrees Fahrenheit instead
Until the mid-1970s, International operated with significant
of the standard 180 degrees Fahrenheit, providing a significant
autonomy. “International was independent and we would get
cost savings for customers. Later renamed Ecotemp, this low-
reports when they had them ready,” said Ken Markwardt. “At
temperature dishwashing business gradually grew and
one of the board meetings, someone
expanded into a core Institutional program offering institutional
customers a broad array of warewashing products and equipment choices for monthly lease or purchase.
Eco-Line was also developed in the 1970s when food
distributors were becoming a major industry force. EL
recognized that many of its customers wanted the convenience
of one-stop shopping for food and supplies and
the simplicity of a single monthly invoice. In response, at the
1977 Institutional Management Meeting, the division officially
launched more than 50 warewashing, laundry
and housekeeping products and sold them to distributors under a
new name – Eco-Line. Institutional salesmen called on the distributor’s customers. The distributor set the prices and made the
product deliveries to the end-users. Eco-Line increased the division’s market share by reaching smaller customers. In time, EL
dropped the Eco-Line name and broadened its network of
wholesale food and hospitality industry distributors. The growing business was renamed Distributor Programs, eventually providing each member of its carefully selected network of
distributors with custom-labeled EL products.
40
CHAPTER 6: JOINING
THE
GIANTS
< EL’ S SE R V I C E P OLICY. Economics
Laboratory backed its commitment to service in writing
by presenting customers with a detailed description of
services they could expect to receive.
> E.B. AC C E P T S AN A WARD . In 1970,
E.B. Osborn received the Distinguished Service Award in
Washington D.C. in recognition
of EL’s efforts to provide job opportunities
to the mentally-challenged.
and equipment in nine U.S. plants and 20 plants in other coun-
asked me a very simple question, and I couldn’t answer it.”
tries.
This lack of accountability led to a reorganization of the
International Division in 1975, which brought finance, corporate planning and staff functions under more centralized super-
Growing social awareness
vision.
Responding to new laws on consumerism, pollution, human and
civil rights, EL formed a Corporate and Public Affairs
Major plant expansion
Department in 1970 and pledged to work with government to
In 1971, EL manufactured more than five million pounds of
meet change, communicate with employees, the public and
powdered and liquid products per day and operated eight U.S.
stockholders, and protect the environment.
EL began to actively promote equal opportunities for women
plants and two in foreign countries. Record company growth led
to major plant construction throughout the decade. A plant in
in the 1970s. EL Today featured stories on women and minori-
Garland, Texas, replaced EL’s Dallas facility. On the interna-
ties in supervisory positions and suggested ways to move up the
tional front, plants were added in Milan, London, Tokyo and
ladder. Women also began to join the sales ranks in the mid-
New Zealand. In 1974, despite price controls, gas rationing and
1970s, and the company’s top recognition award – the “Man of
raw materials shortages, EL invested $25 million in capital
the Year” award – was changed in 1975 to “Employee of the
expansion, the largest sum in company history. That year, it
Year.”
The 1970s also brought an intensified focus on employee con-
completed its largest production facility in Joliet, Illinois, to
consolidate and replace plants in Chicago, Beloit and Roscoe.
cerns through company-sponsored programs and
“Joliet was so depressed in those days that when we finally
family counseling on alcoholism, chemical dependency and dri-
decided to move there, we became front page news,” said Ray
ver safety.
Wheeler. By the end of the 1970s, EL manufactured products
41
CHAPTER 6: 1970-1979
< D ISTINGUISHED SERVICE A WARD . In1970,
The Presidential Committee on Employmentof
theHandicappedhonored EconomicsLaboratory with its
Distinguished Service Award.
> F R E D L ANNERS N A M E D CEO. Before his
death in 1978, Chairman of the Board and
CEO E.B. Osborn passed the reins of the
company to Economics Laboratory President
and Chief Operating Officer Fred Lanners. Lanners
served as chairman, president
and CEO until he retired in 1982.
In 1970, E.B. Osborn traveled to Washington, D.C.,
The void left by E.B.’s death led to a proliferation of new
to receive the Distinguished Service Award from The
management posts, including a three-person Office
Presidential Committee on Employment of the Handicapped
of the President, created in 1979. Top executives split the com-
for EL’s work with the mentally-challenged.
pany business along international and domestic lines, and a new
The company program provided vocational training
decentralized approach kept them autonomous.
and employment of these people as “Utility Men” in the food-
In 1979, EL surpassed $400 million in sales, the forty-fifth
service industry. The program began in the sixties, attracted
consecutive year of sales increases. It ended the decade with
national interest and expanded throughout the country in the
three single divisions – Consumer contributed 25 percent,
ensuing years. It was later extended to train underprivileged
Klenzade added 13 percent, Magnus generated 10 percent – and a
residents in Caracas, Venezuela.
four-business Institutional Division which generated 52 percent
of company revenues through Institutional, Econ Systems,
Osborn era ends
Environmental Sanitation Services and EL Service. Economics
Until 1978, EL exhibited many attributes of a family-run com-
Laboratory just kept getting bigger and better.
pany. E.B.’s wife Gloria sat on the board. His son was
a senior executive. The company had traditionally promoted from
within, rarely looking outside to fill important positions. Many
senior executives at EL, including EL President Fred Lanners,
had never worked for another company. “Fred had basically the
same philosophy that E.B. had,” said Hodges. “He reported to
E.B. probably longer than anybody else
in the company.” In 1978, 71-year-old E.B. Osborn named
Lanners CEO. In August, he died at his home in Bronxville,
New York. “To the last moment he was going to the doctor’s
office with his briefcase, studying papers,” said Podas.
< JO L I E T, I L L I N O I S. EL’s 10-acre plant in Joliet, Illinois, was
completed in 1974. The company’s largest plant, it was built to
accommodate Midwest sales growth for years to come.
> E C O L A B VE H I C L E O N G OLDEN G A T E BRIDGE : As the 1970s
ended, service institutions, manufacturers and consumers from coast
to coast depended on Economics Laboratory for quality products and
outstanding service.
42
‘“Service ranks supreme:
Throughout the 1980s,
Ecolab’s reputation for service
and problem solving was
unmatched by any
competitor.’’
CHAPTER 7: 1980-1989
Overcoming
Tough
Challenges
Economics Laboratory, like many U.S. companies, was riding an inflation tide in 1980. Sales exceeded $500
million and the company marketed more than 1,000 products and services for cleaning, sanitation and related
uses. More than 2,600 sales and service personnel provided customers with “Products and Services for a
Cleaner World.” It seemed that nothing could stop EL’s upward climb. However, the illusion was about to be
shattered.
The Apollo debacle
The high price of Apollo drew skepticism from stock analysts. As it
In February 1980, EL acquired Apollo Technologies, Inc.,
a New Jersey company specializing in chemical systems to control combus-
turned out, the skeptics were right. Economic circumstances, govern-
tion and emissions in coal-burning electric utilities. At $71 million, the cost
mental decisions and even nature seemed to work against success.
of Apollo was enormous, but EL executives were confident of its potential.
Falling oil prices and abundant natural gas lowered demand for coal and
With Apollo, it was felt, EL got a technical infrastructure that would have
chemical products used to treat it. Enforcement of air emissions and
cost $100 million and taken 10 years just
water discharge regulations went into decline. The United States
to get to where the competition was at the time.
enjoyed an unusually mild winter. And rising consumer costs and conservation measures instituted in 1979 led to the first drop in electric
A new Industrial Group was formed, comprised
consumption in U.S. history.
of Klenzade and a six-part Apollo Division that included Pulp and Paper,
The financial drain caused
Electric Utilities, Mining
and Metallurgy, Metal Processing, and Magnus
by Apollo had a dramatic impact
Maritec. A new Water Sciences Division was also
on 1980 earnings and problems
launched to provide products and services to opti-
continued to worsen.
mize heat transfer, energy efficiency and corrosion
< S O L I D PO W E R . Solid Power , a chemical warewashing capsule introduced in 1981,
set new industry standards for safety,
convenience and cost.
inhibition in boilers, evaporators and cooling towers.
< C OLLAGE . Clockwise from top: Solid
Power production line; Institutional sales force
parades through downtown St. Paul in 1984; company forms Pest Elimination Division.
44
CHAPTER 7: OVERCOMING TOUGH CHALLENGES
< P IERSON “S ANDY ” G RIEVE . Sandy Grieve
was named chairman of the board and chief
executive officer in January 1983, after
CEO Fred Lanners retired.
> S O L I D P OWER L A U N C H E D I N E U R O P E.
In 1985, Gerald K. Carlson, senior vice president –
International (left), and Allan L. Schuman, senior vice
president – Institutional, extended EL’s global presence
by successfully launching
the company’s line of solid products in Europe.
Grieve comes on board
Renewed focus on core businesses brought an end
When CEO Fred Lanners retired in November 1982,
to EL’s varied Magnus operations. Magnus was sold to Man-
the board of directors had an opportunity to bring in
Gill Chemical Co. in 1986 and Pulp & Paper was
a fresh perspective. They chose an outsider – Pierson
sold to Diamond Shamrock that same year. Magnus’s European
M. “Sandy” Grieve – to head the company.
operation went to Henkel KGaA of West Germany and Magnus
Maritec was sold to Drew
In January 1983, four days after Grieve became chairman
Chemical Corp. of New Jersey.
and chief executive officer, EL shut Apollo down,
In 1986, EL achieved record sales and earnings,
halting an annual operating loss of about $4 million.
and the corporate annual report theme was “Mission
The company was forced to take a $42 million loss. “When
Accomplished” to reflect the successful three-year
EL makes a mistake, it is a beaut,” said Bill Podas.
restructuring effort. Costs were reduced more than
Grieve immediately announced a three-year plan
to reduce annual costs by $30 million, refocus on core strengths
$50 million annually and $62 million in assets were
and eliminate marginal businesses. “Fiscal 1983 was a year of
sold and converted to cash. Ecolab stock, which had dropped to
dynamic decision and change – perhaps
$12 a share during the dark days of 1983, rebounded to nearly
the most difficult in your company’s 60-year history,” said
$30 a share.
Only one-third of the 16 corporate officers in 1983 were still
Grieve in the 1983 report to shareholders. “It was a year
of painful but necessary decisions that were made in order to
on board three years later. Half had been recently recruited from
regain our momentum and focus on our strengths.”
outside the company, including its new Chief Financial and
Administrative Officer Michael E. Shannon. And more than half
That year, EL cut general and administrative expenses by $5
million by reducing personnel. Surplus property sales generated
of the 100 second-tier senior managers were new to their posi-
$10 million. EL closed Capsule Laboratories and discontinued
tions.
manufacturing in Ireland. The Industrial
Division cut its sales force in half,
A pivotal year
research was streamlined into fewer,
By 1987, EL had survived its greatest set-
more interrelated disciplines, and the
back and was poised to move forward.
fragmented financial area was cen-
Even so, it was to be the most pivotal
tralized into one cohesive unit.
year in its history, a year that would profoundly change the company’s identity
At the same time, EL added
and structure.
95 Institutional salespeople world-
In December 1986, Economics
wide, stepped up new product developand
Laboratory, Inc. changed its name to
Consumer divisions, and invested in
Ecolab Inc. to provide a simple and
management information systems to
unifying worldwide identification.
ment
in
the
Institutional
improve efficiencies.
45
CHAPTER 7: 1980-1989
< A P IVOTAL Y EAR . In December 1986, the com-
pany adopted a new name – Ecolab Inc. – and traded its
listing on the NASDAQ market for a new listing on the New
York StockExchange.The changes heightened the company’s visibility worldwide.
> C H E M I C A L E N G I N E E R I N G FA C I L I T Y.
In 1980, EL doubled the size of its
Chemical Engineering Center in Eagan.
The company expanded and modernized
its facilities throughout the decade to
accommodate growth and new technologies.
In 1987, Ecolab acquired ChemLawn, the nation’s largest
The new identity incorporated the essence of the
former name – “Eco” for ecology and environment,
lawn care services company, for $376 million.
and “Lab” for technology and labor. It also resolved the prob-
The largest acquisition in Ecolab history, ChemLawn
lem that had plagued the company for decades – a lengthy,
gave Ecolab a nationally known brand name and more than 1.5
cumbersome and confusing name that was often misspelled,
million residential customers, which provided
misinterpreted and improperly abbreviated. Suddenly, the com-
it with a ready-made residential services business that
pany that had been referred to as EL, Econ Labs, Economics
complemented its institutional operations.
After a profitable year in 1988, ChemLawn’s performance
Laboratories and non-English
identities such as Soilax Italia, became simply Ecolab – short,
plummeted in 1989. During the critical spring period, the new
easy to pronounce, with a contemporary appeal.
organization could not handle the influx of calls from prospec-
A bold, distinctive new visual identity accompanied the name
tive and existing customers. Problems were complicated by the
change.
worst drought to hit North America in 50 years and growing
public opposition to chemicals and pesticides. Customer cancel-
That same month, Ecolab listed on the New York Stock
Exchange. The NYSE affiliation enhanced the company’s stand-
lations poured in, and ChemLawn ended 1989 with a loss of $8
ing in the investment community and heightened the interest of
million. Ecolab responded by cutting 500 jobs and rebuilding
foreign investment institutions. The company also changed its
field management. “Accomplishing the turnaround at
fiscal year to a calendar year.
ChemLawn is a gargantuan task, but one that we believe
In 1987, Ecolab sold its Consumer Division to Benckiser for
ChemLawn is now equipped to accomplish,” said Grieve.
$250 million, ending a half century of innovation that had made
Ecolab products known to consumers throughout the world.
Consumer’s latest success – Scrub Free – a heavy-duty bathroom cleaner introduced in 1983, was
the most successful new product introduction in company history. Scrub Free sales hit $20 million in its first 18 months on
the market. But competing with the consumer giants Lever
Brothers, Colgate and Procter & Gamble was more expensive
than ever. Despite record sales in 1984, Consumer Division earnings dropped after advertising and marketing budgets were factored in. It was the end of an era.
< E C O L A B NA M E CH A N G E. In March 1987, Executive Vice
President Allan L. Schuman introduced the company’s new name
in full-page advertisements in leading industry publications.
> E C O L A B IS L I S T E D ON THE NYSE. Ecolab’s 1986 listing
on the New York Stock Exchange generated significant interest among
institutional investors. By the end of the decade, Fortune magazine
ranked Ecolab 71st among the country’s largest diversified service companies.
46
CHAPTER 7: OVERCOMING TOUGH CHALLENGES
> S K Y L I N E O F D OWNTOWN S T. PA U L .
In 1986, the Institutional Division, the
company’s largest, moved its headquarters
to downtown St. Paul after more than 30 years in New
York City. The consolidation brought
a new spirit of unity to the company.
Facilities and Technology
than three decades, first from a swank Park Avenue high-rise
In 1980, as the decade was beginning, EL doubled the
and later from a suburban White Plains office building. The
size of its Chemical Engineering Center in Eagan, built a new
division’s dominant size and distance from corporate headquar-
plant in Brazil and expanded facilities in the United States. In
ters set it apart from the rest of the company. But the com-
St. Paul, the company increased computer memory storage capac-
pany’s new leadership felt the time had come to consolidate the
ity nearly fivefold to accommodate 40,000 daily transactions and
corporate offices under one roof and fully integrate the com-
purchased two buildings adjacent to the Osborn Building to
pany’s operations. Spearheading the move was Al Schuman,
accommodate growth.
then the senior vice president of the Institutional Group, who
By 1986, capping off the turbulent years of restructuring, the
envisioned enormous opportunities for a cohesive EL.
company announced plans to move Institutional Division head-
In July, 13 employees and their families sold their homes,
quarters from New York to St. Paul. The
packed up and moved to EL’s heartland headquarters
division, which then contributed 56 percent of EL sales and 90
in St. Paul. The migration brought a boost to the local economy
percent of earnings, had operated from New York City for more
and added a dynamic spark to the company.
The New Yorkers brought marketing skill and sophistication
and a fresh and bold new business style. After a period of
adjustment, the blended EL culture emerged stronger, smarter
and more focused.
International moves forward
Throughout the 1980s, EL continued to expand its business in
Asia and Europe. In 1984, EL acquired full interest in its Hong
Kong joint venture. In 1986, it bought the remaining 50 percent
share in EL Japan from Chisso Corp. In 1987, the company
launched a joint venture in the People’s Republic of China and
began operations in South Korea in anticipation of the 1988
Olympic Games.
During the same period, EL acquired Deterquimica, S.A., of
Spain; Elton Chemical S.p.A. of Italy, a $7 million commercial
< S OLID T EAM O F S E V E N . By 1987, Ecolab’s “Solids Team” was
the industry leader and the only full line of solid products designed to
meet all institutional warewashing and kitchen cleaning needs.
> E C O L A B PARADE I N DOWNTOWN S T. PA U L . In September 1984,
the 1,200-member Institutional sales force ended its national sales meeting with a 30minute parade in downtown St. Paul.
47
CHAPTER 7: 1980-1989
< NASA S OAP. In 1986, the National
Aeronautics and Space Administration chose
EL to develop “space soap” for astronauts
on space stations. To test its Zero-G Whole
Body Shower Cleansing Agent, EL tested the
soap in a NASA-type shower, which used
only one gallon of water for bathing.
> S O L I D C HOICE . Ecolab’s Solid Choice
applied solids technology to the beverage industry. In
1988, Klenzade Senior Account Manager Doug Lee, left,
answered an employee’s product questions.
On a perfect September day in 1984, capping the
laundry and institutional warewashing company; and Alkalion
A.B., a $7 million Swedish company specializing in institu-
first national sales meeting in six years for the company’s 1,200-
tional laundry and warewashing systems.
member Institutional sales force, EL held a 30-minute parade
before a noontime crowd in downtown St. Paul. Six marching
Institutional is solid performer
bands blared, majorettes twirled and hundreds of salesmen in
The heart of the company, the Institutional Division, continued to
white coats marched behind floats bearing giant product repli-
lead EL in financial performance and product innovation. Solid
cas. State legislators and business executives reviewed the
Power, introduced in 1981, was the new industry leader in restau-
parade from the Osborn Building. “This is a one-on-one profes-
rants, hospitals and other institutions. A patented, state-of-the-
sion,” said Al Schuman. “This is a way to say thank you for a
art capsule, Solid Power was inserted into a closed warewashing
job well done.”
system, delivering control, safety, convenience and low use cost.
“Solid Power is a unique concept that will outstrip conventional
Consolidating Ecolab’s institutional power
systems and products,” predicted Al Schuman, vice president,
In the mid-1980s, EL took its first step toward developing a new
Institutional Division-U.S., in 1982. He was right. Sales soared,
range of integrated, institutional services that would culminate
and within two years, it was the nation’s top selling detergent in
in the “Circle the Customer – Circle the Globe” strategy. In
the institutional market. The success of Solid Power led to the
1984, EL acquired Lystads, Inc., a privately held company spe-
development of a Solids Team of seven solid cleaning products,
cializing in pest elimination services for the institutional sanita-
the only full line of solid chemicals designed to serve
tion market. Based in Grand Forks, North Dakota, the company
all warewashing and kitchen cleaning requirements.
was a market leader in the Midwest, with sales of more than $20
million. The next year, EL acquired ICE, Inc., of Atlanta, a pest
48
CHAPTER 7: OVERCOMING TOUGH CHALLENGES
OF LYSTADS . EL entered
the pest elimination business in 1984 by
acquiring Lystads, Inc., a privately held
company based in Grand Forks, North Dakota.
< A CQUISITION
> PE S T E L I M I N A T I O N D I V I S I O N .
After a series of acquisitions, Ecolab formally
created a Pest Elimination Division
in 1987. The division contributed
$30 million in sales that year.
elimination company serving 10 states in the Southeast. By the
acquisitions. The largest was the Textile Care Division
end of 1986, following purchases of Guardian Pest Control,
of Occidental Electrochemicals Corporation, a $15 million com-
Inc., of Baltimore, Maryland, and Apest, Inc., of New Orleans,
pany selling laundry products and dispensing equipment
Louisiana, pest elimination comprised 10 percent of Institutional
through distributors. In 1987, Ecolab formed the Textile Care
business, or $30 million a year. In 1987,
Division to provide laundry products, dispensing systems and
Pest Elimination was elevated to division status and joined the
services to commercial and institutional laundries. Ecolab was
growing ranks of services, as customers turned to Ecolab for the
again the national leader in the
same high level of quality and professionalism in pest elimination
institutional laundry business, furthering its “Circle the
that they had come to expect in other offerings.
Customer” evolution.
After selling Econ Systems in 1981, EL renewed its
In 1986, EL set the stage for a new Janitorial Division
commitment to the on-premise laundry market in 1984
by acquiring the Airwick Professional Products Division of
by acquiring Foussard Associates, Inc., a St. Paul company spe-
Airwick Industries, a leader in floor maintenance and odor con-
cializing in hospital laundry management. Although Foussard
trol products for institutional housekeeping, particularly in the
was sold only three years later, EL continued
healthcare market. With the addition of a Janitorial Division, the
to bolster its laundry-supply position through several
EL sales-and-service force was armed with the products, services and professional expertise necessary to handle the full
range of cleaning and sanitation requirements of any
Institutional customer.
Finally, three years later, Ecolab acquired NCD Detergents
Inc., which led to the development of its Signature Label business, a custom label for distributors. The original Eco-Line program offered to distributors in the 1970s had grown into an
enormous business. By the late 1980s, Ecolab’s carefully chosen
alliances with the nation’s leading wholesale food and hospitality product distribution companies was placing Ecolab-manufactured private-label products in nearly every business in America.
In 1988, the Institutional Group was reorganized and renamed
the Ecolab Services Group. Al Schuman was tapped to head the
new organization, which included Institutional, Pest Elimination,
Textile Care, Janitorial and Klenzade, as
AT C LEAN G L A S S E S . EL’s commitment to service enabled EL
representatives to build close working relationships with customers.
In 1983, chef Terry Ries, of the St. Paul Hotel, consulted with Ecolab Institutional
sales representative Nick Fahey.
< L OOKING
49
CHAPTER 7: 1980-1989
< TE X T I L E C ARE D I V I S I O N . Ecolab
renewed its commitment to the on-premise
laundry market in 1984. After several acquisitions,it formed the Textile Care Division in
1987,to serve customers processing a minimum of one million pounds of linen a year.
> JA N I T O R I A L D I V I S I O N . EL acquired the
Airwick Professional Products Division of
Airwick Industries in 1984, which led to the
development of a new Janitorial Division.
In 1988, the division joined the Ecolab
truly unique and always appreciated.
well as U.S. Manufacturing and Distribution and Information
In 1989, Fortune magazine moved Ecolab from the
Services. As the decade ended, the carefully planned
“Circle the Customer – Circle the Globe” strategy envisioned
industrial to the service category, ranking it 71st among
by Al Schuman was coming to fruition. Said Schuman in
the nation’s “100 Largest Diversified Service Companies.”
1989: “Our strategy is to surround our existing customers
Ecolab had more than 8,000 sales and service personnel
with a variety of services, so that all they have to do is look
worldwide and employed approximately 13,000 people in
to Ecolab for all their cleaning and sanitizing needs.”
29 countries. Sales exceeded $1.3 billion. The Ecolab
Services Group was strong and growing, but ChemLawn’s
Service ranks supreme
poor performance was dragging down earnings.
Throughout the 1980s, Ecolab’s reputation for service and
problem solving was unmatched by any competitor. “Our
people are like doctors,” Al Schuman had noted in a 1981
article in Corporate Report magazine. “They will come out
to service an account anytime, anyplace, day or night.
You’re at a dinner party and a customer calls with a problem – you leave the party. We get to know a client’s business better than he knows it himself.”
Ecolab’s strong service philosophy was a crucial ingredient in the company’s success. Frequent calls, checkups
and maintenance visits kept Ecolab associates close to
their
customers, while periodically reviewing and evaluating
customers’ needs helped Ecolab associates retain clients,
build more business, and helped the customers maintain
an optimal level of sanitation and achieve full compliance
with safety and health regulations. Ecolab’s partnership
approach to service cemented many customer relationships and provided customers with extra value that was
> E X C E L L E N T S E R V I C E . Ecolab’s well-trained team of knowledge-
able and professional associates sustained the company’sreputation
for outstanding service throughout the 1980s.
50
The Qualities that define
the Ecolab Culture:Spirit,
Pride, Determination,
Commitment, Passion
and Integrity.
CHAPTER 8: 1990-1998
Focused on
the Future
Ecolab entered the 1990s with a record $1.4 billion in sales and three separate lines of business. The five-division
Ecolab Services Group was the core of the organization. The International Division was also strong and growing.
But ChemLawn was still operating at a loss, despite significant investments to improve management, organization
and productivity. In 1992, Ecolab announced plans to divest its ChemLawn subsidiary and take a $275 million loss.
“While ChemLawn continued to offer good long-term potential in residential services, Ecolab’s core business and
shareholder value would be best served if we concentrated on our institutional and industrial cleaning and sanitizing
markets,” said Grieve. “We decided that our future should be entirely in the cleaning and sanitizing business where we
began, where we are well positioned and where the worldwide market potential is enormous.”
In 1992, Ecolab sold ChemLawn for $107 million.
Ecolab goes global
Henkel’s overall business
In anticipation of a united European market in 1992,
produced products and services similar to those offered
Ecolab took steps to bolster its position across the
by Ecolab’s Institutional and Klenzade businesses. Henkel-
Atlantic. “As the 1990s begin, Ecolab is changing its busi-
Ecolab headquarters was established in Düsseldorf,
extended to 24 European loca-
ness perspective,” stated Grieve in Ecolab’s 1990
tions, and immediately
annual report.
“A strategic alliance with Henkel
became the leader in
KGaA of Germany, currently being
½nalized, will strengthen Ecolab’s
< S TRATEGIC AL L I A N C E
position in the global marketplace.”
W ITH HENKEL KG AA. Ecolab
With nearly $8 billion in rev-
entered the 1990s with plans
to strengthen its global position.
An alliance with Henkel KGaA
made Ecolab a dominant force
in Europe’s largest markets.
enues, Henkel, a family-owned
corporation based in Düsseldorf,
was a giant in the chemical industry, marketing products worldwide
< C O L L A G E. Clockwise from top: Food &
Beverage Division; ECOLink provides on-call customer
service; Ecolab’s sales force travels eight million miles each
through five divisions. Part of
month.
52
CHAPTER 8: FOCUSED
< A L SCHUMAN
AND
ON
THE
FUTURE
M I K E S HANNON .
In 1992, Allan L. Schuman (left) was
named president and chief operating officer and Michael
E. Shannon was named vice chairman and chief financial
and administrative officer.
> M UFSO AWARD . From 1988 to1997, Ecolab was
recognized as the equipment supplies and
service “Supplier of the Year” by the Multi-Unit Food
Service Organization (MUFSO) eight times. In 1998, the
company received an additional honor when it was inducted
into theMUFSOHall of Fame.
Europe’s three largest markets – France, Germany and
the foodservice industry.
Italy. Before the joint venture, Ecolab’s European sales
were $150 million. At the end of 1991, Henkel-Ecolab’s
Thanks a million
sales in Europe exceeded $750 million.
In 1994, after closing the books on 1993, the most successful year in
The company established Ecolab Export GmbH in
1992 to service non-European markets not already cov-
the company’s history, Ecolab’s board of directors set
ered. By the mid-1990s, the network of distributors and
aside $1 million as a “Thanks a Million” award to employ-
licensees was exporting products to more than 100 coun-
ees. The company’s 7,000 non-management employees
tries around the world, including countries in the Middle
with at least one year of service received a profit-sharing
East, Africa, the Asia Pacific region and Latin America.
contribution to their retirement plan equivalent to five
shares of Ecolab stock. A cash award was paid
Successors named
to employees in countries that didn’t provide retirement
In 1992, the Ecolab board of directors named Al
plan arrangements. The company doubled the award to
Schuman president and chief operating officer, and Mike
$2 million in 1997, following another record year.
Shannon was elected vice-chairman, and chief financial
and administrative officer. Schuman assumed Grieve’s
Adding new markets
duties as chief executive officer in March 1995, and when
In December 1994, Ecolab added a broad new dimen-
Grieve retired in December, Shannon became chairman
sion to its “Circle the Customer” strategy. It acquired Kay
of the board. “The 12 years I’ve spent at Ecolab have
Chemical Company, the leading cleaning product supplier to
been the most successful, satisfying and fulfilling of my
the quickservice (fast-food) market, which includes fast-food
44-year career,” said Grieve in his farewell letter. “It has
restaurants, convenience stores, grocery store delis and other
been a privilege and
quickservice outlets. A family-owned
an honor to serve the customers,
company based in Greensboro, North
the employees and the shareholders
Carolina, Kay Chemical had entered the
of this outstanding, successful com-
fast-food business in 1966, when the
pany. ”
industry was in its infancy. By 1994, it
was a $70 million company with 280
After 37 years in the company’s
employees.
Institutional core, Schuman had the
The transaction with Kay gave
experience, drive and leadership to
take Ecolab to a new level of
Ecolab a long-sought position in the
achievement. In 1995, Nation’s
fast-food cleaning and sanitizing mar-
Restaurant News named Schuman
ket. Like Ecolab, Kay was known for
among the
excellent customer service, expertise in
50 most influential individuals in
dispensing technology and related ser-
53
CHAPTER 8: 1990-1998
< PA R I S , F RANCE . The Henkel-Ecolab alliance
opened the doors to many of
Europe’s most prestigious institutions.
This premier Parisian restaurant overlooking Notre Dame
relies on Henkel-Ecolab
products and services to uphold
its impeccable reputation.
The Janitorial Division also changed its name to Professional
vices. The transaction created a sixth division for Ecolab.
Products following the 1996 acquisition of Huntington
Kay was a strong contributor from the start. It strengthened
the breadth of Ecolab’s offering
Laboratories, Inc., of Huntington, Indiana. The acquisition cata-
to the restaurant market, providing
pulted Ecolab into the number two position in the U.S. janitorial
a strong presence in quickservice
market.
In late 1997, Ecolab acquired the specialty chemical business
to complement Ecolab’s full service capabilities. By 1997, Kay
had entered the growing grocery deli market and was generating
of Minneapolis-based Grace-Lee Products, a
five percent of the company’s total revenues.
manufacturer and marketer of cleaning products for the U.S.
vehicle car wash market. With the acquisition came a new cor-
A seventh division was added in 1995 through the
creation of Water Care Services, a division offering water treat-
porate program – Ecolab Vehicle Care – providing products and
ment products and services to the hospitality, healthcare and
services to the $500 million independent car wash and company
food processing markets. The company aggressively expanded
fleet wash businesses.
the division by acquiring Industrial Maintenance Corporation of
Charlotte, North Carolina, RO/CO Corporation, of Washington,
Product innovation continues
D.C., and Western Water Management, Inc., of Kansas City,
Ecolab’s unwavering commitment to meeting customer needs
Missouri.
provides the impetus for its outstanding record of product inno-
Klenzade changed its name to Food & Beverage in 1995 to
focus more directly on the Ecolab name. “The Klenzade name
has served us well during the 34 years since its acquisition,”
said President and CEO Al Schuman. “And with the name
change, our Food & Beverage customers will receive the same
high quality products, equipment and service as before. We are
still the most trusted name in the business.” The division
acquired H.B. Fuller’s Monarch Division the following year,
which strengthened the geographic coverage of the dairy market.
< R ESTAURANT N E W S . In 1995, Nation’s Restaurant News,
a leading industry publication, named Ecolab President Al Schuman
one of the 50 most influential individuals in the foodservice industry.
> K AY C H E M I C A L C OMPANY. In late 1994, Ecolab acquired Kay Chemical
Company, the leading supplier of cleaning and sanitation
products to the quickservice (fast-food) industry. The privately held
company became a new Ecolab division.
54
CHAPTER 8: FOCUSED
ON
THE
FUTURE
< O A S I S S YSTEM . In 1994, Ecolab introduced
the Oasis System , a rainbow of easy-to-identify
cleaning products for the housekeeping
market. Easy-to-use Oasis products are
automatically mixed and dispensed on site.
> HU N T I N G T O N P R O D U C T S. Ecolab
became the nation’s second largest provider
of janitorial products and services following
its 1996 acquisition of Huntington Products.
vation. For 75 years, Ecolab has set the pace in the industries it
products no longer meets today’s requirements. Before, one group
serves by developing products, services and equipment that per-
refined a product formula, another tested it and a third manufac-
form better, faster, cleaner, safer and more cost effectively. The
tured
company’s 1997 annual report summed up its approach with the
off when its task was completed. Today’s new generation of solid
cover theme: “You see
products requires a complex process development approach.
a world. We see a world of opportunity.” By aggressively
Chemists and process engineers work closely to develop formu-
pursuing these opportunities for innovation, 35 percent
las. Small batch experiments follow to test chemical reactions.
of Ecolab’s total U.S. sales come from products and services
Packaging engineers evaluate containers and consider the prob-
introduced or modified within the last five years.
lems of storage, transportation and usage. People from opera-
In the 1990s, the Institutional Division has continued
it,
each
handing
the
project
tions, product and process development, and manufacturing
to launch a number of successful products, including the Oasis
continually interact with chemists, technicians and engineers.
product dispensing system, and Solid System III, the first solid
The complexity of product development is vastly multiplied
product and dispensing system for on-premise laundries. In
when one considers the sheer numbers of products passing
1993, Ecolab achieved yet another breakthrough in institutional
through the Ecolab process at any given time. In 1997, the com-
warewashing with the Vanguard System, which proved to be
pany introduced 135 differentiated products, systems and ser-
one of the most successful
vices. Scores of others remain under development and testing as
product introductions in Ecolab history.
Ecolab associates relentlessly seek
Ecolab moved its solids technology another step forward in
to anticipate industry needs, read market trends, and solve cus-
1997 with the introduction of GeoSystem 9000,
tomer problems. In this never-ending quest for excellence,
a third-generation line of high-performance solid detergents,
Ecolab remains the undisputed leader.
rinse additives, presoaks and dispensers for institutional ware-
Patents protect Ecolab’s extensive investment in products
washing. The company achieved new levels
and technology development. Today, the company has 2,500
in food processing safety with the 1997 introduction of
registered trademarks and more than 240 active
Tsunami, an environmentally sound, easy-to-use
patents. The company receives about 20 new
food processing treatment that improves
U.S. patents each year and has 30 in the
the quality of processed fruits and veg-
works at any given time.
etables. In 1998, Tsunami received
Circle the customer
EPA
and FDA approval for use in
After building a firm foun-
the waters of fresh-cut
dation for expansion in the
fruits and vegetables.
late 1980s, Ecolab formally articulated its ongoing
Ecolab has found that the
commitment to service excel-
linear product development process
that
lence
worked
in its “Circle the Customer – Circle the
so well for yesterday’s powder and liquid
55
CHAPTER 8: 1990-1998
< Q U A N T U M . The 1993 introduction of Quantum
helped Ecolab’s food processing
customers improve equipment cleaning
through a computer-programmed formulator
that blends raw cleaning materials on-site
and prints data on the type and amount
of product used, and its application.
> G EO S Y S T E M . A new line of solid, high-
performance warewashing products called
GeoSystem 9000 was introduced in 1997.
Globe” strategy in the 1990s. As part of this two-pronged strat-
stretch 2,150 miles, the length of the Great Wall of China. The
egy, Ecolab develops and markets a broad array of products
company dispatches more than 5,000 service vehicles to deliver
and services to meet the full spectrum of customer needs. Then,
products to customers in 150 countries.
as customers grow globally, Ecolab goes with them, directly or
Facilities focus on quality
through distributors.
Improvement of process, facilities and technology support the
The Circle the Customer concept reflects Ecolab’s ability to
forge strong and successful partnerships with even the largest
company’s Circle the Customer – Circle the Globe strategy. In
organizations. More than 1,500 Ecolab employees from
1991, Ecolab established a Total Quality Management program
Institutional, Food & Beverage, Research, Marketing and
based on the Malcolm Baldrige National Quality Award criteria
Finance serve one foodservice and food processing conglomerate
to improve business strategy and increase customer value.
In the mid-1990s, Ecolab added plants in Thailand,
account, for example. Food & Beverage supplies the account
with products and services to plants that process the customer's
Indonesia, Costa Rica and Mexico. The first new U.S. plant in
lines of various food products. Institutional, meanwhile, sup-
seven years was built in Hebron, Ohio, and a new state-of-the-
plies cleaning and sanitation products and services to the cus-
art corporate employee training center, Ecolab University, was
tomer's more than 1,000 restaurants.
Ecolab does, indeed, live its service commitment. Each
month the Ecolab sales force drives more than eight million
< C IRCLE T HE C USTOMER , C IRCLE THE G L O B E . In the 1990s,
miles, the equivalent of circling the globe 10 times per day.
Ecolab formally articulated its goal to fulfill the full range of customer needs, with its
Circle the Customer, Circle the Globe strategy.
Each year, cleaning products sold in the United States alone
> S ERVICE M AN I N J APAN . Ecolab’s outstanding sales and service force
provides Institutional and Food & Beverage customers in Japan with superior products
and excellent service.
56
CHAPTER 8: FOCUSED
ON
THE
FUTURE
> W ORLDWIDE S OLIDS . Ecolab circled
the globe in the 1990s with universal cleaning and sanitation solutions. The company’s world-renowned products, systems and services
are industry leaders in every country.
established in the company’s St. Paul headquarters campus in
ously, even those in charge could only imagine how large, effec-
1998. The move brought new jobs to downtown St. Paul and
tive and important this service would become to the company’s
renewed Ecolab’s commitment to employee growth. “This spec-
day-to-day operations. Now, ECOlink is a dream come true.
tacular campus mirrors our company and its values,” said
Schuman. “It’s a world-class operation, and it clearly demon-
A people-oriented culture
strates Ecolab’s commitment to its people, products and future.”
Strong corporate focus and seasoned leadership has enabled
Ecolab to achieve continually higher levels of financial perfor-
It was in 1995 when Ecolab’s award-winning national customer service center, ECOlink, celebrated its tenth anniversary.
mance in the 1990s. In 1997, global revenues reached $2.5 billion
From three customer service representatives set up to handle
and earnings attained a fourth year of double-digit growth. Today,
two sales regions for the Institutional Division, ECOlink has
almost 15,000 Ecolab associates serve customers throughout the
grown to more than 190 representatives providing service to
world. With more than 11,000 premium products, Ecolab is the
five divisions. In 1998, ECOlink handled more than 13 million
world leader in nearly every market it serves. “We have always
customer calls, and the numbers are growing. Ten years previ-
had the best products, and we’ve had people who are in tune to
the market,” said Al Schuman. “We’re a very aggressive company.”
Ecolab’s competitive drive is balanced by a caring attitude.
“We’re a very people-oriented company,” said Schuman. “Our difference is our people, and our customers know it. We take an
aggressive attitude, but we treat people well.”
In 1980, Ecolab organized the Ecolab Foundation to systematize its educational, community development, health and
human services and arts and cultural programs – to improve and
stabilize communities. The company articulated its commitment
to the environment in the 1990s through its ten Environmental
Principles that guide the establishment of corporate policies and
procedures.
But the formal programs don’t capture the true essence of the
Ecolab culture, which has existed for 75 years. Ecolab’s founder,
Merritt Osborn, was a generous and caring friend to many in
< F OOD & B E V E R A G E D I V I S I O N . Known for more than three decades as
Klenzade, the division was renamed Food & Beverage in 1995 to more accurately
reflect the markets it serves.
57
CHAPTER 8: 1990-1998
< E COLAB U NIVERSITY. Ecolab’s state-of-
the-art employee training center, named
Ecolab University, opened in the company’s downtown St.
Paul headquarters in 1998.
> H URRICANE A NDREW V OLUNTEERS .
In the wake of 1992’s Hurricane Andrew,
Ecolab employees united in Miami, Florida,
to help residents repair their homes.
ties and incorporate them into their lives.
need. Ecolab’s first employee, Ida C. Koran,
Schuman is confident that Ecolab’s strong culture
sustained that spirit through the Ida Koran Trust, a fund that
supports Ecolab employees enduring hardship or seeking funds
will carry it to new heights in the years ahead. “We are
to finance a child’s education.
going to be a ten- to fifteen-fold bigger company in our
one hundredth year than we are today,” he said. “Our
Today, hundreds of Ecolab employees around the world are
active community volunteers, generously donating their time
basic strengths, our aggressiveness and our company
and their skills to dozens of organizations. The company backs
culture will make it happen.”
its employees with generous contributions to people and organizations worldwide.
When Hurricane Andrew hit the Florida coast in 1992, Ecolab
shipped 65,000 pounds of disinfectant hand soaps, pot-and-pan
cleaners and other products to the region, and employees pitched
in to help people rebuild their homes.
In September 1994, the company shipped 40,000
pounds of cleaning and sanitizing products to Iowa, Illinois
and Missouri to aid in flood relief. Ecolab donated products
to Rwanda refugee camps in 1994, in the wake of political
unrest, and to Kobe, Japan, following its 1995 earthquake.
And when floodwaters in Grand Forks, North Dakota,
caused a shutdown of Pest Elimination’s headquarters
in early 1997, relief efforts took on massive proportions.
Donations to Ecolab associates and the Grand Forks
community, both in monetary and material form, surpassed more than $200,000.
In 1996, the company formally articulated the qualities
that define the Ecolab culture – spirit, pride, determination,
commitment, passion and integrity. Ecolab people from
the top down and around the world embody these quali-
> E C O L A B TO W E R. When Ecolab celebrated its 75th year in 1998, the company’s 21-story office tower remained a dominant landmark on the downtown St. Paul
skyline. That year, the company initiated a renovation of its three-building headquarters campus to see it into the 21st century.
58
Quest for
Excellence
Ecolab’s
Our mission Our mission is to be the leading global
their education and training. We have constructive and
innovator, developer and provider of cleaning, sanitation
open lines of communication, and establish goals with our
and maintenance products, systems and services. As a
associates. We encourage associates to participate in set-
team, we will achieve aggressive growth and a fair return
ting these goals and judging their own performance.
for our shareholders. We will accomplish this by exceeding
Our global workforce is a team of diverse, talented,
the expectations of our customers while conserving
action-oriented people who demonstrate spirit, pride,
resources and preserving the quality of the environment.
determination, commitment, passion and integrity. Our
associates are enthusiastic, honest, open and hardwork-
Our shareholders We are a growth company. We will
ing, do their jobs well, and expect their co-workers to do
provide our shareholders with a 15% annual growth in
likewise. We use the company’s assets as carefully as if
per share earnings while continually investing in product
they
research and business development to assure a reliable
were our own, suggest ways to be more productive, and
future. Dividends will be consistent and recognize share-
help each other. We encourage people to take initiative,
holders’ needs for an adequate return and the company’s
go the extra mile, make the additional call! Above all, we
need for growth capital. Our financial objectives also
want associates who accept responsibility and account-
include a minimum 20% return on beginning of the
ability for their own growth, behavior and performance.
year shareholders’ equity and an “A” rated balance sheet.
We provide a clean and safe work environment. We
We intend to remain an independent company and
care about each other and enjoy working together as a
chart our own course.
team.
Recognizing that the quality of our shareholders’ invest-
We learn from our mistakes and celebrate our victories.
ment is built and measured over time, we will not sacrifice
We hire the best qualified people. Associates are
long-term growth in sales and earnings for short-term
rewarded based on performance and teamwork. We
results.
encourage self-development and promotion from within.
To effectively maximize our shareholders’ equity, we
must have strong, positive relationships with our cus-
Our customers Our customers are our business part-
tomers and our associates. Our objective is to have all
ners. We listen to them, respond quickly to their current
associates be shareholders.
needs and anticipate their future needs. We deliver quality
services, products and systems that are safe and reliable.
Our employees Our most important resource is our
We are superior to our competitors, providing the highest
associates. We recognize and reward associates who
value to our customers at a fair price.
actively demonstrate and support The Ecolab Culture and
We work closely with our customers, tell them the truth
Quest for Excellence.
and earn their business every day. Superior service built
We are committed to creating a global environment
this company and continues to be our central policy and
that respects diversity and individuality. To best utilize
and develop our associates’ many talents, we invest in
59
philosophy. We are a vigorous, tough, ethical competitor.
believe in the free flow of candid, objective information, up,
down, and across organizational lines. We observe uniform
Our organization We are a flexible, innovative, respon-
accounting practices and prompt disclosure of operating results,
sive and entrepreneurial organization. We structure our busi-
with no surprises. We insist on preparation and planning. We
nesses around the needs of our customers and provide only those
encourage over-achievement.
central services which are essential to our growth, the protection
of our corporate assets, or provide significant advantages in
Our society We recognize the importance of service to soci-
terms of quality and cost. Performance is judged on the extent to
ety and contribute positively to the communities in which we oper-
which it promotes the overall good of the corporation over the
ate. Our business is conducted in accordance with the law and
separate interests of individual business units and functions.
stated corporate and societal standards of conduct.
Our business environment is constantly changing. We are
This statement is an expression of our mission and shared val-
committed to creative, innovative approaches that lead to break-
ues, the achievement of which is an ongoing challenge and a
through performance. We are always improving.
never-ending process. It requires us to respond effectively to an
We value simplicity; we take action. We expect results. We
ever-changing environment. It requires pragmatism and dreams,
endorse substance over form, and quality over quantity. We
courage and confidence, trust and commitment.
Culture
Ecolab
“We have many different ideas and many different people
please our customers, surpass our record achievements, and drive
throughout our organization. Yet we are one company, one team,
our organization to greater success.
with one culture.”– Al Schuman, president and chief executive offi-
Commitment Like a family, we are united by an unspoken
cer, Ecolab
pledge, bound by our convictions. We prize dedication, and are
Spirit Ecolab associates are the company’s heart and soul.
moved to help each other and our customers. We accept nothing
Hungry to succeed and passionate to achieve, we embrace the
less than loyalty in our ranks. We are true to each other and to
unknown, fearlessly taking risks, confident in our ability to
our cause.
deliver results. We are eager and ambitious. We tenaciously perse-
Passion We wholeheartedly believe in our company;
vere, surmounting obstacles with grit and determination. Above
its goals and objectives are our mission, and we enthusiastically
all, we find joy in our work, and in serving the company and our
embrace them and relentlessly pursue them. More importantly,
customers.
we truly believe in each other, care, protect
Pride Exceptional service, exceptional products…we delight in
and support each other.
presenting premium quality in all we offer. No matter how big the
Integrity Professional. Reliable. Trustworthy. Honest.
project, or how small the request, we strive for excellence in our
Our corporate integrity is a critical asset and we are committed to
response, for we relish perfection. We cherish our company, and
upholding it worldwide. We set high standards, and we abide by
represent it with honor.
them as we practice business fairly and behave ethically. We
Determination Ambitious and aggressive, driven and
share our expectations with each other and strive to maintain a
determined, enthusiastic and energetic, we cultivate the opportu-
work place built on mutual values,
nity to compete. We thrive on challenges, viewing them as an
trust and goodwill.
invitation to success. A true team, we work together to routinely
60
Publication Information
Editor and Project Director
Helen Carciofini
Credits
Calgonite – Beecham Inc.
Spic & Span – Proctor & Gamble
All – Conopco (DBA Lever Brothers Company)
Kiwi – Sara Lee Corporation
Snowy – Reckitt & Colman Inc.
Sta Flo – The Dial Corporation
Sta Puf – The Dial Corporation
Scrub Free – Joh. A. Benckiser GmbH
28741/0800/0199
61