A Thinking Man's Outfit
As CEO of Levi Strauss & Co., Robert Haas presides over a multinational family-controlled company that is almost as well-known for caring about people as for its blue jeans. The company went public in 1970, but the Haases bought it back in 1985 because they wanted to head ofF greenmailers and raiders and preserve its values and traditions.
Haas, 48, a great-great-grandnephew of the founder, addressed San Francisco's Commonwealth Club not long ago on the theme, "The Corporation Without Boundaries." What follows are excerpts from the question-and-answer period, in which he talked about some of the company's current concerns:
On why providing above-standard employee benefits is good business
We do what we do because we believe it's the right and proper thing. But clearly we are fortunate to be able to attract high quality people who demonstrate a great sense of loyalty and initiative and creativity, and so our reputation [for generous benefits] helps us competitively as well.
On actively encouraging employees to get involved in their communities
I think our employee volunteer efforts, which were started by my father some years ago, are an early example of how an empowered organization works. We call our employee volunteer activities Community Involvement Teams. In every one of our facilities around the world we encourage people to come together, seek to identify community problems, and work to raise funds to help those organizations or bring a little joy to senior citizens or people with special needs. Our people decide what their priorities are, organize themselves, and really make a difference in the communities in which we operate. We as managers don't give them any direction. Instead, we profit from their experience by seeing what the true needs of the communities are. This enables us to direct our corporate philanthropy to areas that support what our employees think is important rather than what we might think is important.
On the future of the mommy track and the daddy track
I think we all need to recognize that the work force is changing. The needs and hopes of workers are changing, and we need to become more flexible so that the best people will want to stay with us. We don't have all the answers. We know that a lot of it has to do with the policies that a company might have — flextime, shared work, the ability to cover for one another — but a lot of it has to do with supervisory practices, with understanding the needs of a working mother or a working father.
On the use and misuse of employee stock ownership plans (ESOPs)
Just as one size of Levi's jeans won't fit all consumers, so I think there are different motivations behind employee stock ownership plans, and they work differently in different environments. Clearly, some companies have adopted ESOPs as a vehicle to diminish the risk of hostile takeovers. The only way to make employee stock ownership really work toward the ends that I think are hoped for — to involve employees in the company and make them feel like owners — is to take some positive steps. Provide a lot of information. Give people responsibility and authority. Help them to work as a team rather than as isolated individuals. Help them understand how their activities can make a difference and lead to improved performance.
Whether you give employees stock or sell employees stock won't make a lot of difference. Make people feel like owners, though; then give them the opportunity to buy stock, and you've got a real winning proposition.
Ever since we went private, we've had the philosophy that there should be no secrets in our company. We believe that people should have the information that they require to do their jobs. So within the company we do share a lot of financial information that may not be as regularly accessible outside our company.
On dressing for success
Many [of our employees] grew up wearing our product, and since we've abandoned a formal dress code in our headquarters, it seems they like working in them too.
On doing business in South Africa and China
We choose not to operate in those countries where our own employees would not enjoy basic human rights; where we could not carry on commerce in a proper fashion. The difficulty, of course, is that with the upheavals that we've seen in the world, what might have been an unsatisfactory environment in the past could become a very appealing environment in the future. As regimes change in your existing markets, you have to monitor them to see if they remain suitable places for you and your employees to have a presence — something we do all the time. But clearly it would be offensive to employees if we were to operate in countries that didn't share the basic values that we promote within our company.
On increasing prospects in Eastern Europe
We currently manufacture Levi's jeans in Hungary and in Yugoslavia, and we market our product in a more limited way in most of the Eastern European countries. The difficulty — for those of you who are familiar with trade in Eastern Europe and the Soviet Union — is getting paid for your merchandise. Because of the lack of convertibility of local currencies right now, it's more difficult for Levi to establish a full-scale entity in certain countries. Obviously the events of the last several months may open up new possibilities for us, and we have people scurrying all over Eastern Europe taking a look at what the possibilities might be.
On what he'd do differently
I wish I could answer with something more spiffy than "nothing."