Jerrold

"Jerrold faced serious issues—chief among them was inflated numbers tied to a corrupt purchasing department taking kickbacks. Productivity at the main factory was also poor. We overhauled purchasing, shut down the Philadelphia plant, and moved operations to more efficient locations in Nogales, Mexico; Springfield, Massachusetts for high-end parts; and Asia for low-cost components. By committing to large-volume buys, we cut costs dramatically."

"GI was one of the first companies to market with UHF tuners, introduced in the 1950s and ’60s to allow TVs to receive ultra high frequency (UHF) channels (13 through 48) beyond the original very high frequency (VHF) band (channels 1 through 13). GI had stock that was overvalued at the time, and the company wanted to use it to buy something. Jerrold, it was discovered later, had some financial irregularities, always to the upside, of course, since accounting “errors” rarely make a firm’s finances look worse rather than better. So GI had used inflated paper to buy an inflated business. Less than a year after the Jerrold acquisition, GI was in trouble. It had bought a series of businesses, which wasn’t working, and, worse, now General Instrument was struggling to stay current on its loan payments."

"The company accepted promissory notes from customers, a legal promise to pay the bill—and sold the notes to financial institutions at a discount. Most banks wouldn’t touch loans for such a risky business. When a lot of those early entrepreneurs overextended themselves and faced financial trouble, Jerrold took over their systems. Consequently, Jerrold became one of the largest “community antennae TV” operators in the country."

"We focused hard on offering the lowest prices on volume products the industry needed, down to the little connectors to join or plug in cable wires. So that every time a Jerrold salesperson greeted a client, there was a reason for the order book to come out. And just by doing a better job of running the business, we saw the results start to improve and our market share go way up. Monty was thrilled."

"I flew to Tulsa, drove to Gene’s house, drank brandy, and shot pool. That was the sales pitch. And then Gene would say, “Let’s go get some steaks for dinner. You can stay over, we’ve got a spare bedroom.” Soon, I was selling Gene cable boxes and whole systems, turnkey, with an ironclad promise to stand behind our word. One-on-one worked well for me. Jerrold was booming."

"To really get inside the business, I launched a key account system—each top client had a Jerrold exec on point. I took the top five myself."

"I relied on creative problem-solving skills I had honed at Jerrold and in my days at Bell Labs and McKinsey. Some days I felt energized by the challenge, like a young mechanic back home piecing together parts on the garage floor and trying to get a dead engine to come sputtering back to life."

"As we were talking through the troubles at Jerrold one day, Monty asked me straight-out if I’d like to run GI’s Jerrold myself. I was getting tired of being a consultant and never seeing my family. If Leslie and I moved to a nice neighborhood in Philadelphia, maybe we could build a more stable home life without all the traveling. I could be president of Jerrold, the third-largest U.S. cable operator and one of the largest divisions in GI. I’d be the one making the decisions, rather than simply whispering in the CEO’s ear."