Richard E. Hattwick
of Economics (Retired)
Western Illinois University
|This monograph briefly sketches the entrepreneurial
history of one of the nation's major corporations.This
particular history dramatically illustrates
the role of technology in creating a better
life for mankind and the role of the "free
enterprise system" in encouraging men
like Harry Barber and Bill Greene to dedicate
their lives to the task of creating that
BARBER - GREENE
|The Barber-Greene story is an outstanding
example of the interplay between the profit
motive and broader social objectives within
the American business organization. The
company was founded in 1916 by two mechanical
engineers, Harry H. Barber and William B.
Greene. Barber and Greene were motivated
in part by the potential profits to be earned.
But the co-founders were also motivated
by the vision of a broader business purpose.
As Greene put it several decades later:
Our role has been in easing the physical
burdens of mankind. Our machines dig
the ditches, shovel the coal, build
the roads and do those dirty, rough
heavy jobs formerly assigned to our
newest immigrants - the men with the
shovels and the wheelbarrows. We have
often had the satisfaction of seeing
a laborer transferred from a ditch
to the controls of a machine, thereby
acquiring a new dignity and a new
outlook for himself and for his children.
(Greene, 1966, p.4).
The Barber-Greene story is also a fascinating
chronicle of growth and change in the modern
corporation. The company started out as
a small business and enjoyed modest growth
until the Great Depression forced the organization
to fight for survival. World War II caused
the company to experience rapid growth and
by the end of the war, Barber-Greene had
become a very large business, known world-wide.
In the post war era numerous organizational
changes were made to enable the company
to cope with its new size and with the new
economic environment. The changes culminated
in the adoption of a comprehensive and detailed
system of planning and control in the late
nineteen sixties and early nineteen seventies.
THE FOUNDERS’ BACKGROUNDS
important part of the Barber-Greene story
is the background of the founders. Both
men represent backgrounds common to mid-western
American businessmen of the era. And the
events that caused these men to “strike
out on their own” are also typical of that
period of American business history. Here,
in the words of Greene himself, are the
important facts regarding the founders’
Harry H. Barber was born in Freeport,
Illinois, on January 18, 1878. I (Greene)
was born in Lisle, DuPage County, Illinois,
on September 4, 1886.
We were both born and raised on farms,
of pioneer stock, of good parents, in
a wholesome environment; and we each
graduated from the University of Illinois
as Mechanical Engineers. (Barber 1907,
Our common experience of farm life during
the turn of the century gave us similar
points of view and attitudes. We each
shared in the farm work as our school
work permitted, and we experienced long
hours of hard work but not so hard as
to preclude our realizing the satisfactions
of farm life and participating in the
constant planning for increased farm
productivity which we could observe
resulting in increased leisure and more
amenities and comforts.
Harry Barber’s college years were postponed
by a stint in the Freeport freight depot
of the Illinois Central Railroad after
high school. He was eight years older
than I and well matured when he entered
college. Harry had summer employment
with Link-Belt Company which oriented
him to the materials handling field;
but on graduation, he joined a newer
company in that field, the Stephens-Adamson
Manufacturing Company of Aurora, Illinois,
together with a classmate, Earl Stearns,
who became an important addition to
our organization years later.
In the fall of 1907, a severe financial
panic struck, and we of the Class of
1908 who followed found little demand
for our services. I got a job that fall
with the original Robins who had pioneered
belt conveyors (now Hewitt-Robins Co.)
And thus also was introduced to the
materials handling field. After two
years “on the drawing board,” I transferred
...Harry’s greatest talent was his unusual
originality and ingenuity. He acquired
in the field a good sense of economic
need, and in the shop a sense of structure
that went beyond stress diagrams and
tables of strength of materials. His
conclusions seemed more intuitive than
results of slide rule and formula calculations.
This was coupled with a contagious enthusiasm
and an unfaltering drive.
I had become deeply interested in the social
implications of machinery that could
do the work of men. In consequence,
I found myself more interested in broad
applications than in nuts and bolts,
and thus in promoting these fruits of
our engineering. This led to my becoming
Advertising Manager and in that capacity
creating and editing a house organ which
I christened THE LABOR SAVER. This was
an appropriate name which was retained
by Stephens-Adamson until the years
of the depression when the idea of “labor
saving” stood accused (Ibid., pp. 4-5).
FOUNDING THE COMPANY
As fellow employees at Stephens-Adamson,
Harry Barber and William Greene developed
a friendship and out of that friendship
emerged the courage to set up their own
business. Greene describes these developments
as follows (Ibid., pp.4-10):
Out of our continued interest in saving
labor, we became aware of fields not
served by Stephens-Adamson, and which
they did not feel were compatible
with their heavier line. Also we had
been observing the large number of
small isolated jobs where the material
was handled by shovel and wheelbarrow,
and which might be helped by portable
conveyors. In retail coal yards,
they had to unload cars by hand,
and to load wagons by hand from the
sheds and piles. Contractors, gravel
pits and small industries all had
to move material the hard way.
Henry Ford had dramatized the possibilities
of mass production. He had given new
impetus to the process of mechanization
and repetitive manufacture, and his
spectacular example created a favorable
public understanding of the social
benefits of mechanization, standardization,
and the resulting increased production
per man. Also “Mecanno” toy building
sets had become popular, in which
standard pieces of components could
be assembled into a multitude of combinations.
While automotive quantities could never
be achieved in a line of conveyors,
repetitive manufacture was a possibility.
Standardized components including
terminals and intermediate sections
could be developed and carried in
stock, thus allowing a wide range
of customer choice, off-the-shelf,
from a relatively small stock. (This
permitted production in quantity,
thereby lowering unit costs and customer
As these ideas evolved, we became obsessed
with the idea of our own business.
Neither of us had the capital nor
the desire to undertake a venture
alone. We felt that the other’s abilities
were necessary supplements to our
own and that a balance of combined
talents would yield more than the
sum of our two separate abilities.
Our list of potential products in the field
of Standardized, Continuous Flow,
Materials Handling Machines were impressive–possibly
20 items. None were designed but that
was not critical. What was important
was gauging the untapped market–the
small isolated jobs that could be
economically mechanized out of the
shovel and wheelbarrow stage. That
could hardly be tested without real
To provide manufacturing facilities, I
interviewed W.S. Frazier and Company
of Aurora (in what is now the Vendo
plant) whose horse-drawn carriages
were becoming obsolete and whose racing
sulkies, while not obsolete, could
not take up their slack. Yes, they
had available shop space and they
would be glad to undertake our manufacture
for us as sub-contractors, we to design
and sell and assume the risk.
It was premature to work out detailed
business plans, but our mutual interest
was sufficient assurance that we could
So we decided on our initial step. Harry
was to quit his job, complete his
designs, get some working models and
test out our market. I would keep
my job so we could have one salary
coming in until things were ripe for
more active promotion. That was a
nice conservative plan.
We arranged an evening to broach our plans
to the “old man”–Wiley W. Stephens,
the very much liked and respected
president of Stephens-Adamson, who
had hired each of us. It came
as a shock to him to think of losing
two of his hand picked trainees, and
it was complicated by real mutual
affection. We all agreed to take time
to study it in further detail and
let him review it with Dave Piersen,
then Vice-President and General Manager
and slated to succeed as President.
Dave was a realist. We had already
“tasted blood” and there was little
likelihood of our continuing to be
satisfied under their jurisdiction.
Further, Dave thought little of the
idea of my staying with S-A until
our own plans had matured further;
saying that “your heart will be in
your own business and you won’t be
worth a damn to us.” And thus a company
After winding up details of our respective
jobs, we left in good will with advice
and with the best wishes of the officials
and of our many good friends.
Our basic policies had already been hammered
out; we would design and sell Standardized
Materials Handling machines. As equal
partners, we would observe with each
other an equality of ownership, compensation
and authority; Barber to carry the
responsibility of design and manufacture;
I, the sales, finance, and business
We would consult and agree on all matters
of major importance in each area of
It was taken for granted that we would
be ethical in all aspects of our business,
scrupulous in honoring our obligations,
with all our operations consistent
with the public welfare. We would
be model employers, concerned for
our employees’ growth and development,
and for their welfare; as generous
in our remuneration as our competition
For our operating plans; we had agreed
on the name Barber-Greene Company.
We would subcontract our manufacture
to W.S. Frazier and Company. We had
each committed ourselves to an investment
of $3,500 to be advanced as needed.
Our wives had budgeted our personal
expenses (salaries) at $150 per month.
We would use the Barbers’ guest room
as our office, temporarily; also Barber’s
antique portable typewriter which
I mastered sufficiently for our first
For immediate operations, we would: ...build
a portable belt conveyor as quickly
as possible and get it installed in
some coal yard as a demonstration
unit, and then test the market with
advertising and sales calls.
In this initial planning, our wives participated
and concurred. They were critically
important and if either one had lacked
the vision and the confidence and
the fortitude required at the beginning,
as well as during the good and bad
years that followed, I would not be
writing this history. They had
proposed the reduced salaries that
we paid ourselves. They managed their
households within the budgets, even
allowing for our Model T’s and for
breaks in the routine for fun and
relaxation. Their confidence in us
and in our venture provided a sustaining
influence often needed.
Now the challenge of converting dreams
into reality and of piloting a new
business through the rough waters.
Our beginnings were modest but fast
moving. On our official birthday,
Saturday, October 21, 1916, we opened
a bank account with the first installment
($1,000) of our initial investment.
And over the weekend, we were busy
with detail plans.
The following Monday, we took the train
to Chicago, interviewed possible suppliers,
and established our credit with General
Electric and one or two others. We
ordered an electric motor, two wood
pulleys, 32'6" of 18" 4-ply canvas
belting, and sufficient steel for
a conveyor. I think there were some
other things, including two wrenches
and a machinist’s hammer, which we
carried out with us.
The balance of the week was spent in fabricating
and assembling Conveyor No. 1 in the
Frazier shops. While Harry was supervising
the manufacture, I was busy getting
some of the paraphernalia for a simple
business, designing and buying forms
and more important, getting our first
order. The order came from our nearest
neighbor, the Lilley Coal Company.
Having made their first sale, Barber and
Greene began advertising their product in
the Retail Coalman. Orders
began to come in for Barber-Greene conveyors
and the company was on its way. As the conveyor
business expanded, Barber-Greene received
through Stephens-Adamson an inquiry from
a cement company regarding the possibility
of developing a self-propelled self-feeding
bucket loader for handling cement clinkers.
Barber worked on the concept in his basement
and in a matter of days came up with a full
size test unit. The product was successful
and by the end of 1916, Barber-Greene was
selling two product “lines” to the public.
INITIAL SUCCESSES: 1916-1930
The first decade of Barber-Greene’s history
was a period of growth and technical accomplishment.
Once again W.B. Greene captures the essence
of the period. In his words (Ibid., pp.12-13):
At the start of the decade, orders
for conveyors were rolling in beyond
our capacity. Agents and dealers kept
applying for territories, and although
these had to be judged with little
or no personal contact, results were
surprisingly good. Mussens Ltd. of
Montreal, our first dealer appointment,
has continued to represent us through
the years as one of our leading representatives.
Brandeis of Louisville and Zeigler
(now Zeco) of Minnesota also date
back to those early years.
In spite of the activity and profit in
our initial conveyors, Barber was
not satisfied. While these first conveyors
reduced the cost of unloading cars,
they did not fully mechanize the job,
and dealer salesmen lacked the patience
and ingenuity to adapt them to existing
sheds. Barber’s answer, in 1917, was
a conveyor on an elevating rack (Style
E) adapted to stockpiling and to unloading
from dump cars. This soon became,
and remains, the accepted standard.
We soon took over our own assembly in a
small unheated warehouse which we
leased from Frazier for $300 per month
and thus we became manufacturers.
Frazier continued to fabricate for
In the meantime, we were studying expansion
plans, checking buildings and sites
both in Aurora and elsewhere.
The actual steps taken were:
Incorporation for $50,000—(500 $100
Exchange of our partnership fro 250 shares
Sales of balance of stock at par: 25 each
to ourselves; 60 to McIllwraith;
140 to selected individuals “who
could afford a risk and who would
not interfere with our management.”
Purchasing of the first two lots of our
Contracting with W.H. Graham and G.A. Anderson
on a 10-year purchase agreement
for construction of Building No.
1 (70' x 100') and a 20' x 40' adjoining
We moved into the shop late in December,
1917. That was the winter of
the deadly influenza, of the big snow,
and of the coal strike and heatless
In 1918, confident of a peacetime market,
after the Armistice, we authorized
an increase of our capital to $250,000,
and strengthened our Board of Directors
by two additions. One was H.S. Capron,
a Champaign banker, a brother-in-law
of Barber’s, who thereafter served
as our financial advisor. He proved
to be helpful in establishing bank
credits which might not otherwise
have been available to us. The other
was my brother H.S. Greene who was
to become Vice-President and an energetic
and competent sales manager from 1921
In 1922, our retail coal business
had become quite competitive. It was
attractive to us, however, because
it was closely related to consumer
needs with little drop-off in a depression.
We developed a very complete line
of belt and flight conveyors together
with wheel and crawler-mounted flight
loaders with screens and power hoists.
This was a close margin bread-and-butter
business, active until natural gas
superseded coal for house heating
after World War II.
The first experimental ditcher, in 1922,
was mounted on a bucket loader chassis.
However, the feeds and speeds and bearing
pressures called for a special Chassis
for later models. The first production
model was released in 1923 and it found
a ready market that had not been anticipated
by manufacturers of the large trenchers.
We found that we could dig in coral
rock so we were ready for the spectacular
Florida land boom in 1926. Surprisingly,
neither sales nor production set our
limits in Florida, but rather a shortage
of railroad cars.
In 1919, we had an opportunity to try out
a loader on concrete road construction.
The practice had been to accumulate
windrows of aggregate on the roadway
and from these to supply (by wheelbarrow)
the mixer. Our loader replaced the men
shoveling to the wheelbarrows. Later,
separate stockpiles of sand and aggregate
were accumulated at the source of supply,
and loaded by loaders equipped with
measuring hoppers onto light trucks
hauling to the mixer on the roadway.
A typical setup included two long conveyors
(one to build each pile) and two loaders
(for the sand and the gravel). This
became standard procedure throughout
the twenties, almost a monopoly for
us. (This paragraph was added to the
text by W.B. Greene in 1976.)
By 1926 loaders and conveyors were just
beginning to feel the competition of
cranes and bins in concrete road construction.
Coal business was still good and ditcher
sales were increasing. Events conspired
to give us a sales volume not equaled
again until 1940, earnings not equaled
until 1941, and a profit percentage
not since equaled.
From 1927 through 1930, Barber-Greene continued
its profitable existence, but sales dipped,
due in part to increased competition. The
competition was felt most keenly by Barber-Greene’s
conveyor and loader line. More than a dozen
competitive methods were making major inroads
on that end of the Barber-Greene business.
Barber-Greene partially offset the sales
decline through expanded sales of ditchers
and through greater concentration on the
industrial market. To “get concentration
on this market”, branch sales offices were
set up and the aggressive sales force directed
by H.S. Greene attempted to increase Barber-Greene’s
penetration of the industrial markets.
Out of the increased sales effort there
arose a classic organizational problem.
The sales force developed an interest in
having new products to sell and H.S. Greene
began to attempt to “sell” Harry Barber
on product concepts suggested by the field
force. The result as summarized by W.B.
Greene was that, “The Sales Department ...
exerted pressures for changes and developments
without full appreciation of the design
problems and this led to an impasse. This
conflict in philosophy was only resolved
by H.S. Greene’s withdrawal from the Company
in early 1929 (Green, 1966).
H.S. Greene’s departure stands out as the
single example of a major conflict among
the top management group at Barber-Greene.
Such a small amount of conflict is surprising
and the explanation for the amazing degree
of harmony during Barber-Greene’s first
forty years is to be found in the personality
of W.B. Greene. “Bill” Greene was
a born peace-maker - a man who practiced
the precepts of “organizational development”
long before that personnel management concept
was developed. In order to fully appreciate
the importance of Greene, it is helpful
to compare his leadership style with that
of Harry Barber.
Harry Barber demanded much of his employees,
yet earned their respect through his own
technical brilliance, drive and enthusiasm.
Old timers still recall the apprehension
with which a department would be filled
when it became known that Harry Barber was
coming to “check up” on that department.
Such occasions could result in hard feelings
for a time, but they also “kept the organization
on its toes.” Barber’s style was common
among business leaders in those days and
it produced results.
But Barber-Greene was unusual because of
the presence of Harry Barber’s partner.
Bill Greene provided the personal touch
that Harry Barber lacked. When employees
had problems of a sensitive nature, they
would go to Bill Greene and receive a warm
and understanding audience. Greene,
too, set high standards, but he enforced
them with a courteous touch that will probably
never go out of style. Once, for example,
Greene happened upon a group of employees
who had extended a noon-time Christmas dancing
party into the afternoon working hours.
Greene deftly and pointedly led one of the
women onto the dance floor, completed the
dance and without saying a word left for
his office. Everyone else went back to work.
On another occasion Greene’s assistant,
Jack Turner, was upset by an error he made.
Bill Greene sat down and proceeded to tell
Turner the story of the time when Bill Greene
had made a similar but even more costly
mistake at Stephens-Adamson. Turner went
home that night with heightened loyalty
to the organization and a renewed determination
to give the company his best efforts.
Bill Greene’s personal touch was complimented
by his deep respect for Harry Barber. Bill
Greene believed that it was Barber’s inventive
genius that brought forth the company’s
stream of new products. Greene saw his most
important role as that of supporting Barber’s
genius and seeing that everyone else was
motivated to give their full support. Bill
Greene was determined to build an organization
held together by love and mutual respect
within the management group. He was successful.
In 1929 a development occurred which was
to have a profound effect upon Barber-Greene.
In Green’s words (Ibid., p20, 1976):
Our most difficult, as well as most
successful development started in
the fall of 1929. Messrs. George
Craig and Hugh Skidmore of Chicago
(Asphalt) Testing Laboratory, called
to interest us in an application for
our loader for upgrading existing
gravel roads into low cost asphalt
roads. Their particular application
didn’t pan out but they did introduce
us to the asphalt paving field and
we used them thereafter as consultants
on our various developments.
This occurred just when we were desperate
to fill the gap caused by cranes and
bins replacing our conveyors and loaders
in concrete construction.
Our loader became the key unit in the resulting
travel plant. At first the loader
carried a small mixer but the need
soon led to a separate trailer unit
carrying the mixer and the continuous
metering devices for the aggregate
and bitumen. Low cost asphalt road
construction had been partly mechanized
by a rather crude method of blade
mixing (with road graders) on the
highway subgrade. Our method superseded
that, offering more accurate proportioning
and mixing and less vulnerability
During the depression years, we were able
to sell about two travel plants a
year to venturesome contractors on
a rental-with-option-to-purchase basis.
Acceptance was slow but none were
rejected and thus we gathered valuable
experience in the low cost paving
field while making the development
pay its own way. Ash (Barber) cut
his eye teeth on some of these service
jobs as he joined the company after
his graduation in 1933.
SURVIVAL DURING THE DEPRESSION:
The Great Depression of the nineteen-thirties
was a period of severe hardship for Barber-Greene.
As W.B. Greene, recalls (Ibid., pp.20-21):
The depression was an economic and
social catastrophe. While it started
with the spectacular crash of the
stock market on October 29, 1929,
followed by minor reverses and succeeding
major breaks, the full impact of the
crisis came two years later.
There were frequent assurances of ‘recovery
just around the corner,’ and appeals
not to ‘rock the boat’ and ‘business
as usual.’ We made a fair profit
in 1929 and were still slightly in
the black in 1930. Our new asphalt
road machines were promising and it
was logical to assume that vitally
needed road construction would be
continued as an economic stimulant.
For production of our new asphalt machines
we borrowed $165,000 early in 1931
on a bond issue, and we set the foundation
piers for an extension to Building
No. 3. A few months later the
economy slumped further and the future
became so unpredictable that we canceled
the building program. The piers remained
as monuments to our frustrated hopes
Contrary to some in our industry ... we
did not reduce wages and salaries
until April 1931; and, during the
previous winter, we created employment
by production schedules in accordance
with our seasonal practice. A schedule
of 30 ditchers was produced in the
winter of 1930-1931, but ironically,
ditchers became a symbol of the machines
that took jobs away from men. Some
were bombed on job sites. Most of
that last schedule stayed in our inventory
for many years.
Retail coal ... proved to be our most stable
market ... Later as the Government
undertook public works, we were able
to sell permanent and special conveyors
for some of the large dam jobs ...
The availability of both engineering
and shop capacity made this a fertile
period for special jobs and these
enhanced our engineering reputation...
Business reached a low in 1933 after almost
over-whelming losses. We were finally
forced to subordinate everything to
the one goal of Company survival.
Individual employee problems were
beyond our ability to consider. Each
family had to adjust to reduced incomes
and some laid off had to resort to
Federal make-work programs.
Every transaction had to be considered
in terms of ‘cash gain’ or ‘cash loss.’
A sale of surplus inventory might
show a loss but still yield invaluable
cash ... Depreciation was a
non-cash cost. Part of normal maintenance
could be deferred...
We finally reached a point with key salaried
personnel where, instead of further
layoffs, we allocated each a percentage
of billed shipments, resulting in
very slim pay checks without reduced
hours. This was painful but not protested...
We never missed meeting a payroll; we never
skipped an interest payment and we
paid all our creditors in full.
... After struggling through another loss
year, dawn broke in 1936 ...
Profits that year were $82,000 which
made us again eligible for bank credit
and once more we were on own way.
Despite the hardships of the middle 1930's,
Barber and Greene never lost sight of their
need to continue new product research and
development. As explained by Greene (Ibid.,
While development expense was greatly
reduced, we never considered its elimination,
that was our ‘seed corn’ – the source
of future earnings.
RECOVERY AND EXPLOSIVE GROWTH:
|Barber-Greene’s recovery after 1936 was
suddenly accelerated by the outbreak of
World War II. The war created a huge
demand for machines that could be used to
build roads and airports. Barber-Greene
had spent the Depression years holding onto
and improving its technological capability
in these areas and the company became a
major contributor to the successful defense
effort. In 1936 Barber-Greene shipped $1.5
million worth of equipment. By 1943,
the peak war year, Barber-Greene’s shipments
totaled over $11 million, of which $9 million
went directly to the military. During the
course of the war, “There were miles of
runways rapidly constructed in this country;
scores of airports built or resurfaced in
England ... many airports quickly laid in
North Africa just prior to the invasion
of Sicily ... an elaborate chain of airports
built through the Aleutian Islands; ...
(and) many ‘B’s Nests’ which spotted the
Pacific for ... B-29's (Turner, 1966,
During this period Barber-Greene became
a “big business.” The number of employees
rose from 265 in 1936 to 1024 by 1943; a
Personnel Department was established; and
a world-wide demand for Barber-Greene’s
paving technology emerged.
As World War II drew to a close, a new
Barber entered the ranks of top management.
Harry Barber’s son, H.A. “Ash” Barber obtained
a B.S. degree in Mechanical Engineering
from the University of Illinois and joined
Barber-Greene in 1933. By the late
1930's, Harry Barber had begun to suffer
from high blood pressure. Ash Barber began
to assume many of his father’s former responsibilities
and a new team of Greene and Barber began
THE GOLDEN YEARS OF GROWTH:
At the end of World War II, Barber-Greene
entered a twenty year period of rapid and
profitable growth. The growth and the profits
were based on four factors: (1) a
well organized sales effort managed by W.B.
Greene, (2) the company’s decision
to set up foreign “joint partnerships”,
(3) the innovative product line that
Harry Barber had originated and which the
engineering department under the direction
of Harry’s son, “Ash”, continued to develop,
and (4) the post war boom in U.S. highway
The sales effort grew out of discussions
between Harry Barber, W.B. Greene, and “Ash”
Barber. Out of those discussions emerged
the conviction that a unique post-war opportunity
wold emerge in the form of large new sales
opportunities (This seems obvious in retrospect,
but at the time, there was a great deal
of uncertainty as to whether or not the
post war demand would materialize).
In order to capitalize on the anticipated
opportunity, Barber-Greene decided to establish
a sales organization based on a separation
of sales into a Construction Division and
an Industrial Division. It was further decided
to switch the primary emphasis from selling
through Barber-Greene sales offices to selling
through independent distributors.
The foreign expansion fulfilled a long
standing goal of W.B. Greene. In the nineteen
twenties he had become active in an association
of export companies that was formed to promote
exports. As World War II drew towards its
close Bill Greene traveled to England to
investigate the possibilities of setting
up an operation there. The result was the
establishment in 1946 of a joint partnership
with Barber-Greene’s British dealer, Jack
Olding and Co., Ltd. The partnership, “...
combined the name, products, techniques
and capital of Barber-Greene Aurora – with
the management talents, national understanding,
(and) marketing knowledge ... of Jack Olding.”
(Barber, 1966, pp.36-37). The new
company sub-contracted manufacturing to
British manufacturers. In the following
years similar arrangements were made in
Australia, Brazil, Mexico and the Netherlands.
The foreign expansion was also promoted
by the establishment of a world-wide marketing
operation headquarters in Aurora.
Developments at the engineering end of
the business were also crucial in this period.
As explained by “Ash” Barber (Ibid):
Barber-Greene is an engineering company
and its life blood is the flow of
engineered products and applications
... The basic inventions and
developments of Barber-Greene during
its first three decades became widely
recognized and accepted during World
War II. Much of this earlier development
was created and executed by a relatively
few talented individuals ... The detail
design at the beginning of the decade
was based on pre-war standards.
Considerable modernization was immediately
necessary ... This tempo could
not be sustained by the older and
experienced engineering talent, so
it was necessary to follow the same
course as in marketing and production.
The projects were split off and then
subdivided again under the new and
less experienced engineering personnel
who substituted enthusiasm and energy
for experience and caution.
Management changes were several in nature.
At the top of the organization there was
a peaceful transference of the presidency
from W.B. Greene to “Ash” Barber in 1954.
W.B. Greene remained Chairman of the Board.
Also included on the new top management
team were: Sam Faircloth, Vice-President
and Production Coordinator; E.H. Holt, Vice-President
and Director of Sales; Jack Turner, Vice-President
and Director of Publicity and Promotion;
H.E. Herting, Vice-President and Comptroller;
R.C. Heacock, Vice-President and Director
of Manufacturing and Engineering; J.M. Spence,
Treasurer; W.A. “Alex” Greene, Secretary;
Urban Hipp, Assistant Treasurer, and F.J.
Merrill, Assistant Secretary.
In 1948 in the middle of the organization
there was created an unusual entity – the
Junior Advisory Board. This was a
formal organization of younger middle management
persons. The board met regularly to develop
and recommend new corporate projects, such
as personnel policies and order entry systems.
The Junior Advisory Board was adopted primarily
because of its management development potential.
As Ash Barber once put it.
The Junior Advisory Board ... contributed
greatly to individual and group growth
– particularly to inter-departmental
coordination and understanding. This
is not the best method for ‘running
a tight ship’, but it did provide
the strength for the growth from within
multiple decision making areas.
There was also a change in ownership. By
the mid-1950's Barber-Greene had grown to
a size necessitating a major decision. As
Ash Barber put it (Barber, 1966, pp.44-45):
Barber-Greene had been a relatively
“closely held” company. To continue
to do so would probably mean that
the Company’s growth and direction
would have to be curtailed. This would
mean a reduction of opportunity for
many vital people in Barber-Greene.
This course was not acceptable.
Thus there were two alternatives open -
merge with a compatible and financially
strong company - or declare and pursue
a corporate course as an independent
company with a “publicly owned” broadened
base. This was thoroughly discussed
between directors and officers, co-founder
and sons, and key management people.
The decision was unanimous. Barber-Greene
was bigger than any one of us, or
Thus it was that in 1958 and 1959 there
took place a series of events that led to
a successful public stock offering and the
listing of the shares in the “over-the-counter-market.”
One benefit provided by Barber-Greene’s
decision to go public was the ability to
merge with Smith Engineering Works of Milwaukee
in 1960. Founded by Thomas L. Smith,
the firm was directed by Charles F. Smith
during its crucial period of growth in the
period 1913-1951. Barber-Greene had
a policy of avoiding mergers merely for
the sake of sales growth, but the Smith
merger was attractive because Smith produced
a line of aggregate processing equipment
that nicely complemented Barber-Greene’s
product line. In addition there was a long
association between the companies. Smith
bought Barber-Greene conveyors to use with
their crushers, and the two companies had
jointly bid, manufactured and erected jobs
for years. Thus, Barber-Greene’s decision
to go public was the last step needed to
permit a merger.
“ASH” BARBER’S TIME OF TRIAL:
By the mid-nineteen sixties, Barber-Greene’s
business environment began to change significantly
and in 1966 “Ash” Barber found himself at
the head of an organization that was in
trouble. The two major changes that
occurred in the environment were: (1) the
emergence of strong competitors, and (2) a
sharp slowdown in the industry-wide demand
for most of Barber-Greene’s product lines.
When these changes occurred, Barber-Greene
was organized “loosely” in terms of internal
controls and management information. This
loose organization had been entirely satisfactory
for the period of rapid growth when the
emphasis was upon seizing opportunities.
But in the new era of limited opportunities,
tighter controls were needed. In addition,
Barber-Greene was organized along functional
lines with decision-making concentrated
in the hands of the president. This structure
had been workable when the company was smaller,
but by the mid-1960's there was clearly
a need to decentralize decision-making.
For the better part of the decade that followed,
“Ash” Barber devoted his energies to the
task of leading Barber-Greene through a
reorganization which decentralized decision-making,
installed the controls and introduced strategic
planning. The result was a turnaround that
began showing up in improved levels of profitability
The need to decentralize decision-making
was recognized as early as the late nineteen-forties.
However, Bill Greene and Ash Barber moved
slowly and methodically in tackling the
problem. The goal was to provide the younger
persons in the organization with decision-making
experiences that would prepare them for
top management roles in the future.
Ash Barber spent more than five years in
the early nineteen-sixties studying organizational
alternatives, analyzing the professional
growth and development of the younger management
talent that would have to implement the
new system, and analyzing the management
information needs that would be generated
by the new organizational approach. In 1966
Barber felt that conditions were favorable
for action, and, as the first step in bringing
about the needed changes, he brought in
an outside consulting firm to evaluate the
situation and recommend changes.
In 1967 the consulting firm made a number
of recommendations, including the suggestion
that Barber-Greene be reorganized along
product group lines with each group as a
profit center. Barber had expected such
a recommendation and within a matter of
months, management had established five
product groups. The five groups were: construction
equipment, industrial applications, material
handling, repair parts and Telsmith (formerly
Smith Engineering Works).
The consultant also recommended the adoption
of a formalized planning process and the
creation of a management information system
to support the planning. These recommendations
were also expected, but their implementation
required several years of development. In
1967, Ash Barber initiated this long process,
and entered into the most trying period
of his business career. It was a difficult
period for Barber-Greene because the changes
could not be made quickly. The data base
for effective planning by product line had
to be created before effective decisions
could be made and the entire organization
hd to learn how to operate in a formalized
planning environment. Ash Barber expressed
the early frustrations when he said in one
of his memos to the Chief Executive Group
(Barber memo, Feb. 1968):
We have been under way with our first
experience in the new responsibility
budget procedure. It has been frustrating
because of the unraveling of the duplications,
oversights, miscoding, etc. It has
been particularly frustrating because
of the lack of comparative history
and the presently unfinished “cost
Nevertheless, it is my impression that
we have come a long way... However,
it is also apparent that fiscal 1968
will be a major setback to our financial
If we were clearer in our individual product
line profitability, and clearer on
our forward planning profitability
projections by product line and program,
then I would advocate an immediate
realignment of resources no matter
where the restructuring fell. We are
fighting desperately for this information
and when it emerges and when we crystallize
our strategy from it, then realignment
will take place. This company
is going to become a profitable growing
company for everyone’s sake.
By the Fall of 1968, the budgeting and forecasting
process was sufficiently well along that
Ash Barber was ready for the next step.
As he told a group of district managers
on October 14, 1968 (Budgets and Forecasts,
We are formalizing our Corporate Planning.
That means that we will emerge with
a corporate plan - not just a plan
in words and objectives - but a plan
that has been converted from assumptions
and decisions into finite figures
that are summarized into a profit
projection ... (and) that will be
used to measure the success in executing
that plan after the fact are in ...
The plan will cover a fiscal year span
and another form of plan will cover
the next five fiscal years. The next
fiscal year plan will be reviewed
and updated halfway through that year.
The five-year plan will be reviewed
and updated once a year for the new
five-year span ahead....
This is the program ahead of us. The concepts
are not new to industry. Corporate
planning has become well established
in the last decade. The General Motors,
DuPonts, General Electrics, etc. have
been leading out on these concepts
because it became a business necessity.
Much of the recent success in some
of the larger industries is credited
as a direct result of these planning
and control concepts. There are other
large industries that have slipped
back in the last decade and much of
their failure has been debited to
their unwillingness or inability to
tackle formalized planning and control.
Let me be clear on one very important point
here. A business fundamentally will
rise or fall depending upon the combination
of its ingenuity or inventiveness;
its attitudes, talents, and judgements,
its over-all comparative productivity,
and its related raw materials, customer
acceptance, economic climate, etc.
No Corporate planning or control concepts
will substitute for these fundamentals.
However, when two businesses each
have the same potential for these
fundamentals, the business that learns
how to establish plans and control
to those plans under complex inter-relationships
will emerge ahead. In this competitive
business world, we intend to be one
of those businesses that is emerging
But this is not simple, and it is not the
kind of a program that ‘doers’ enjoy.
It’s hard grinding work to put down
finite assumptions and decisions on
paper. It’s frustrating to be forced
to select one opportunity when we
would like to take advantage of two.
It’s not pleasant to control where
expansion at the most familiar center
seems so easy; or to force talent,
resources, and achievement into a
strange channel that does not come
We at Barber-Greene decided over three
years ago that if we were going to
compete as a multi-operation with
multi-decision making centers, then
we had better be able to provide a
formalized planning and control program
that would assist in the optimizing
of Barber-Greene’s total direction,
growth and success. We fully
realized that we were faced with the
development of a management system
equally, if not more complicated than
the one at General Motors or at Caterpillar...
During the next few years Ash Barber devoted
his total efforts to the task of implementing
the new system. The frustrations continued,
and the financial rewards were slow in coming.
Earnings per share declined steadily from
a high of $1.99 in 1966 to a low of $0.67
in 1969. They rose to $1.09 in 1970 but
then fell again to $0.85 in 1971. But by
1972 the financial picture brightened considerably;
earnings rising to $1.15. By 1975 earnings
had risen to $3.40 per share and the turnaround
had been completed (August 30, 1975, Officers).
In the process of implementing the new
planning and control system, Ash Barber
adopted many established procedures that
had been proven successful by other firms.
But, being the innovator that he was, Barber
could not resist trying to develop some
new concepts and techniques unique to Barber-Greene.
Some of these attempts failed. Others were
outstanding successes. One such example
was the accounting system. As Barber put
The accounting systems - particularly
cost accounting-systems - of companies
that are growing are periodically
in need of updating; ours was no exception.
We decided that instead of just updating,
we would design an entirely new system
that would give us the kind of information
flow we needed for a formalized program
for planning and control of the future.
We were pleased to hear the other
day from one of our experienced outside
auditors that, in his judgement, our
new accounting system was ten years
ahead of corporate practices.
Probably the most innovative development
during this period was the implementation
of the production and inventory control
system and, in the years following,
the cost accounting system resulting from
the same data base developed for inventory
management. This system stood out for two
First, through thousands of hours of personal
effort in the form of writing, teaching
and discussing concepts, Ash Barber set
out to develop the system by concentrating
on what was theoretically correct rather
than analyzing what was done and modifying
or improving the existing method. The concepts
of time of order, quantity or order and
cushion (safety stock) techniques went well
beyond any published literature available
at that time.
Second, the implementation of the system
resulted in focusing the attention of the
total organization on the future under a
disciplined formal planning process.
Perhaps more than any other factor the planning
system solved the frustration found in many
complicated manufacturing businesses where
top management decides on a product or marketing
direction but the manufacturing system,
based upon historical data, is incapable
of responding to significant changes of
In 1971, with the “turn-around” underway,
“Ash” Barber handed over the presidency
to Anthony S. “Tony” Greene with Barber
remaining as Chairman of the Board.
Ash Barber had worked long and hard to
accomplish a turnaround and many chief executives
in his position would have liked to continue
to direct the process until the results
showed up in the financial report. But Barber
knew that to be fully effective the new
system required a management style different
from his own and he wanted the new management
to start under favorable conditions. The
new management style required much more
delegation of decision-making responsibilities
than Ash Barber was accustomed to employ.
And so, Barber made the decision to step
down from the presidency. It was a classic
example of the way in which successful businesses
must handle the problem of executive succession.
In 1976 “Ash” Barber joined W.B. Greene
in retirement, and Tony Greene became Chairman
of the Board as well as President of Barber-Greene.
On several occasions the company had been
severely tested by its environment during
the leadership years of Harry Barber, Bill
Greene and Ash Barber. But the company was
able to meet each challenge and move on
to higher levels of achievement. It was
able to do so because the Barbers and the
Greenes understood the underlying strengths
of the business and were willing to make
the sacrifices necessary to maintain the
long run health of the corporation. As Ash
Barber put it, “Barber-Greene was bigger
than any of us – or our families.”
Greene, W.B., “The Beginnings,” in Our
First Five Decades, Aurora, Illinois,
Barber-Greene Company, 1966, p.4.
||Ibid. pp. 4-5.
||Ibid, pp. 4-10.
||Ibid, pp. 12-13.
||This paragraph was added to the text by
W.B. Greene in 1976.
||Greene, W.B., “Our Second Decade ... 1926-1936,”
Our First Five Decades, Aurora, Illinois,
Barber-Greene Company, 1966.
||Ibid., p.20. The fourth sentence in the
quotation was added by W.G. Greene in 1976.
||Ibid., pp. 20-21.
||Turner, J.D., “Our Third Decade – 1936-1946,”
Our First Five Decades, Aurora, Illinois,
Barber-Greene Company, 1966, pp. 28-29.
||Barber, H.A., “Our Fourth Decade – 1946-1956,”
Our First Five Decades, Aurora, Illinois,
Barber-Greene Company, 1966. Pp. 36-37.
||Barber, H.A., “Our Fifth Decade ... 1956-1966,”
Our First Five Decades, Aurora, Illinois,
Barber-Greene Company, 1966, pp. 44-45.
||Memo from H.A. Barber to Chief Executive
Group, February 23, 1968.
||“Budgets and Forecasts” Speech for District
Managers meeting of October 14, 1968.
||On August 30, 2975, the top management
team consisted of the following eleven executive
officers: H. Ashley Barber, Chairman of
the Board of Directors; Anthony S. Greene,
President and Chief Executive Officers;
David B. Hipp, Vice President, Operations;
Frank J. Merrill, Vice President, International;
Merrill E. Olson, Vice president, Sales;
William A. Greene, Vice President, Administration
and Secretary; Urban Hipp, Vice President,
Finance and Treasurer; James H. Rice, Vice
President, Planning and Development; Donald
W. Smith, Vice President, Asphalt Construction
Product Group; Jake R. Smith, Vice President,
General Manager Telsmith Division; Robert
C. Johnson, Controller. In October 1975,
David B. Hipp became Group Vice President,
Construction Machinery; Frank J. Merrill
became Group Vice President, International
Operations; Merrill E. Olson became Group
Vice President, Minerals Processing Machinery;
and Donald W. Smith became Vice President,
Product Group Manager Construction Products.