It's All About the Shoes

When nearly all of his competitors were exporting work overseas, John Stollenwerk kept his 700 factory jobs in the United States -- but not for the reasons you'd think.

It is all too tempting to paint a portrait of John Stollenwerk as the Patriot CEO, vividly brushed on a canvas with strokes of red, white, and blue. Stollenwerk is the president, chief executive, and owner of Allen-Edmonds Shoe Corp., one of the last remaining shoe manufacturers in America.

At a time when more than 98% of all shoes sold in the United States are made in other countries, Stollenwerk is often held up as the lonely holdout against the dark forces of offshoring. Earlier this year, his company was honored with a Making It Better in America award from a business lobby in Wisconsin, where Allen-Edmonds is based. And even George W., on the campaign stump in Milwaukee last October, hailed Stollenwerk as a savior of American jobs. "He made the conscious decision to fix it up to make the right decisions," said the president in perfect Bush-ese, wearing a pair of black Allen-Edmonds "Stanton" loafers, "so he could keep people working here in Wisconsin."

But don't be fooled by the giant American flag outside the Allen-Edmonds headquarters. Sure, Stollenwerk is patriotic and certainly proud that he has kept jobs for the 700 U.S. workers in his plants. But Stollenwerk is not the crusading CEO he's been made out to be. Peel away the patriotism, take the man off the pedestal, and you'll find that things are more complicated than they seem. This unassuming leader isn't refusing to go overseas because of some abstract principle. It's all about the shoes, and he still believes that Allen-Edmonds can make them better -- and serve customers faster -- in the United States. "It's nothing for or against foreign manufacturing," says Stollenwerk, 64. "It's about the quality." Yes, he could cut some corners and probably boost profits substantially. But Stollenwerk just isn't a corner-cutting kind of guy.

A tall man with silvery-white hair and a somewhat distracted smile, Stollenwerk is instead the sort of guy who still talks about old-fashioned "business sense" and cuts short an interview to make it to a meeting with his bishop. Though he is not a shoe man -- Stollenwerk started his career in the exporting business -- he is every bit a salesman. Lifting a pair of chestnut-colored "Hillcrests" from a boardroom display, he points out the hallmark of Allen-Edmonds craftsmanship, gingerly rubbing a strip of leather, called a "welt," that's sewn onto the circumference of both the sole and the "upper," or top leather part of the shoe. The welt, he explains, eliminates the need for metal shanks, which makes Allen-Edmonds shoes more flexible, more comfortable, and more practical than most of their competitors', which use glue and nails.

"John could take this offshore tomorrow and we could double our profits. But he knows that's shortsighted."

Yet an adherence to tradition does not mean that the 82-year-old company isn't finding ways to innovate. It has to. Last year, Stollenwerk invested more than $1 million in a complete overhaul of his manufacturing process, transforming an old assembly-line operation into a lean, efficient system that has already sliced damage rates and boosted productivity. The renovated system could knock 5% off the cost of each pair of shoes -- but moving to China could slash costs by 60%. "John could take this all offshore tomorrow, and we could probably double -- maybe even triple -- our profits," says Mark Birmingham, Allen-Edmonds's COO. "But he knows that's probably shortsighted."

Stollenwerk hasn't turned a blind eye to offshore manufacturers. In 1999, the company experimented with producing a casual shoe style, the "Wayland," with a contractor in Portugal. When the finished Waylands were returned, most of the Wisconsin shoe men had to admit the copies weren't bad. But they weren't Allen-Edmonds. The size stamp on the sole was a little askew, the lining wasn't quite right, the stitching wasn't as fine. A leader who was less committed to quality might overlook such subtleties. Not Stollenwerk. "It's the parts that make the whole," he says. "We could take out a few stitches and you'd never notice it -- and then we could take out a few more. Pretty soon, you've cheapened the product, and you don't stand for what you're about."

That obsession with detail reveals much about Stollenwerk. He's a bit too agitated, for example, by a blue dishrag left out in the kitchenette of the wood-paneled boardroom. His desk, in an open cubicle, is painstakingly neat. Yet despite his need for order, Stollenwerk is known by his team as a hands-off leader who gives people real responsibility and lets them run with it. He can be deferential and at times even seem uninformed about operational details. "My job, really, is setting the tone," he says.

And that is something Stollenwerk has done for almost a quarter of a century. Since he bought the company in 1980, his guiding principle has been a commitment to quality. In 1984, when the original shoe factory burned to the ground on a firehose-freezing Wisconsin morning, Stollenwerk reminded his employees that their greatest asset had been left unscathed. "We have lost a plant," he said, asking them to raise their hands above their heads. "We have not lost the skilled hands that make our shoes."

But ask him what he does to set that tone on an everyday basis -- how he communicates to his team the kind of quality he expects -- and Stollenwerk becomes frustrated, exasperated almost, that you can't see how simple it is. A commitment to quality is woven into his DNA, and he surrounds himself with people who have made the same inner vow. "It's my life. It's the way we live, it's the way I was raised," he says forcefully. "It's me. Consequently, I surround myself with people who have the same philosophy." That philosophy -- built around a willingness to sacrifice short-term gains for the long-term good of his organization -- is what defines Stollenwerk's quiet kind of courage.

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