The Miracle of Pittron Steel
by Peter B. Grazier
Published in EI Network October 1, 1997
The book is a sobering but inspiring look at a life of struggle that prepared Wayne for the work he would later do so effectively. It also detailed a powerful story about how a workplace can be dramatically changed by valuing people. For me, it was one of those books I just couldn't put down.
The importance of this story for those of us in the "organization change business" is that it points to real root causes of change process failure. Many of the decisions we make are driven by our beliefs about people. And if those beliefs include little value for the contributions others can bring, then real participation is probably doomed from the outset.
In 1965, Wayne Alderson accepted a job in the financial department of Pittron Steel, a steel foundry in Glassport, Pennsylvania, and by 1969 he had worked himself up to the position of controller and chief financial officer. As controller, Wayne was responsible for the financial management of the company, and Pittron was in financial trouble. The massive foundry, covering seven blocks along the Monongahela River, was typical of the many steel mills of western Pennsylvania.
The nerve-wracking noises, noxious odors, and ever-present soot created an oppressiveness that hung in the plant all day and night. Pittron was a filthy place to work, and it did not bring out the best in its people.
In 1972, Pittron was on the verge of explosion. There was so much hostility between labor and management that tension was at a peak. On the surface, the issues appeared to be economic---the plant was in trouble financially and the union, the United Steel Workers, had made concessions. But under the surface, workers were feeling animosity over other issues---qualitative issues concerning matters of dignity and personal respect. Despite the company's financial condition, the men went out on strike in October of 1972. The bitterness, charges, and countercharges resulted in what was called "eighty-four days of hell."
Just before the strike, Wayne Alderson had been promoted to the position of Vice President of Operations. Alderson had been critical of the company's policy of "management by confrontation" and intimidation of the workers, arguing that it simply didn't work to improve productivity and quality. Against all industrial relations protocol, Alderson decided to meet secretly with USWA Local 1306 President Sam Piccolo, a tough and skilled representative for the plant's people. He wanted to present a plan called "Operation Turnaround." The difficult meeting broke the ice that had held management and the union in its grasp for years, and began a relationship between Alderson and Piccolo that has continued to this day. Alderson felt that management had to make the first moves to convince the workforce of its sincerity. And so he began by walking into the plant to talk with people.
The first person he visited was a "chipper," who performed one of the hardest and dirtiest jobs in the plant. The chipper chips away defects from large steel castings with a heavy jackhammer. Alderson said, "Let me have a crack at it." And with that, he removed his suit coat and climbed onto the casting. He lasted all of three minutes and conceded that whatever the company paid the man, he earned every cent of it. Within a few minutes, every worker in the plant heard of the incident. By his gesture, Alderson had dignified the least respected task in the plant. As he took more symbolic steps to demonstrate dignity and respect, Alderson began to break down the industrial traditions of the past.
Space limits the detail to which we can discuss this story (I highly recommend the book), but I was particularly struck by one episode that speaks to the need for dignity, respect, and spiritual sustenance. Knowing Alderson was a man of God, one day Sam Piccolo, at a lunchtime gathering, began jokingly needling him. He asked if Alderson was "ready to start teachin' us about the Bible?" Over the next few days the subject came up again, and Alderson began to think they were serious. So informally, the two men began to discuss the Bible, accompanied by a few others from the plant. As time went on, more and more men joined the group. As it grew, they moved the discussion to an abandoned storage room located directly under the open hearth. The dismal room looked like a catacomb. So the men cleaned out the spider webs, brought in stray cats to control the rats, and set up benches.
The men referred to the place as their "chapel-under-the-open-hearth," and one man made a sign that simply said "Chapel." Others began to make their own contributions to the chapel. Wednesday's were set aside for the Bible study meetings. Initial skepticism gave way to belief, as the group grew gradually into hundreds. Workers families were noticing the changes also as love, dignity, and respect were replacing hostility. The ensuing months brought a dramatic change in the plant and its people. Something powerful was bringing an order to life in the plant.
Wayne Alderson is not a "softy. He is a hard-nosed, practical manager focused on the performance of the organization. The difference is how he goes about getting results. By truly valuing people, which he interprets as demonstrating love, dignity, and respect, a foundation is laid for high-performance. Over the next 21 months, Pittron's turnaround was as dramatic as any in the annals of American industry.
- Sales went up 400%
- Financials went from a deficit of $6 million to a profit of $6 million
- The workforce grew from 300 to 1200
- Productivity rose 64%
- Labor grievances went from 12 per week to 1 per year
- Chronic absenteeism running 20% dropped to less than 1%
- Quality of product became the best in the history of the plant
- A poor safety record went to an outstanding one
- Workers became customer oriented and ultimately its best sales people
With profits running high, Pittron was sold by its parent company. Even though Pittron became the shining star in the new organization its management style was just too radical for the new company. Alderson was given the opportunity to remove himself from the Bible study group, but politely refused. His refusal to change his management style at Pittron resulted in his termination from the company. The work world in 1974 was not ready, even when the evidence was overwhelming, for valuing people at work.
As I sat at the rear of the conference room at Lucien's Manor in Berlin, New Jersey, I wondered what was on the minds of the eighty people in attendance. Camden County Health Services Center had a history of tension between management and labor. People were carrying old baggage, some for many years. Tony Peters, CEO of the center, rose to welcome the group to this one-day seminar called Value of the Person.
Tony was followed by the center's union leadership, who supported the need for the seminar. I thought of the courage it took the management team and the union leadership to move forward with such a process.
Wayne Alderson had come with his team: his daughter Nancy Jean, his wife Nancy, Sam Piccolo, Gloria Scumaci, and Reid Carpenter of the Pittsburgh Leadership Foundation. Throughout the day, the message was consistent. There is a basic truth of life based upon valuing people that is under pinned by three elements: love, dignity, and respect.
Initial skepticism and cynicism slowly turned to belief---belief that years of confrontation could be reversed if each person took responsibility for his or her own baggage.
We watched the film Miracle of Pittron that chronicled the astonishing events of the 21-month turnaround. Stories told during the day became real faces, and tears flowed as each person confronted the tragedy of a management system that devalues people. That evening a dinner was held for these employees and their spouses as the message of valuing people moved from workplace to home. Several people spoke that evening, but I was most struck by the comments of Rebecca Moore, President of Council 71, AFSCME Local 2307.
Rebecca said that she would be driving a big truck to the front door of the center the next morning (metaphorically) to collect all the baggage that has been around too long. She encouraged everyone to show up in the morning and unload theirs. But Rebecca isn't one to simply tell others what to do, she then courageously made a public apology to another center employee in the audience.
A friend Ray Martin has shared with me his frustrations about the center for many years. Deeply embedded beliefs are hard to change. But there is always a unique point in time in the history of every organization when an opportunity presents itself---business and labor leaders with a vision and desire to change, a catalyst, and a process. Tony Peters and Ray Martin held the vision, their labor leaders have courageously supported it, and Wayne Alderson and his team appeared at the right moment. From what I observed, I have every confidence that their change process will move forward directly and dramatically. People will change and the center will be better.
I think at times that our resistance to change our workplaces toward more human concepts reflects our fear of intimacy. We feel uncomfortable when speaking of love, dignity, and respect. The head and the heart are parts of a beautifully balanced system we call a human. But somewhere in our evolution we separated the two when it came to our work. The heart plays a distant second to the head. But examples such as the Pittron story should, once again, serve to reinforce that for truly high performance to happen, the heart plays a central role. And so the movement continues.
My thanks to Ray Martin, Tony Peters, and Wayne Alderson for allowing me to spend this day of discovery with them and their people. In no small way they are moving us toward a better understanding of how organizations change. And a final thank you to Rebecca Moore, for demonstrating what real courage means in the process of moving forward.