The deputy he brought with him, Todd Muldaur, a straw-haired Yale football jock who’d done time at the big management-consulting firm McKinsey, didn’t say too much, but there was something about him Nick didn’t like. He didn’t like Todd’s swagger. But hey, it was Osgood who ran the show, Nick figured. Not Muldaur.
Of course, now it was Todd who presided over the quarterly board meetings, Todd who read the monthly financial reports and asked all the questions, Todd who had to sign off on the major decisions. After that first meeting with Willard Osgood, Nick never saw the old guy again.
Nick arrived a few minutes early. Scott McNally was already at the table, nursing a Diet Coke. He’d changed out of his frayed blue button-down shirt into a crisp blue-and-white broad-striped one, a red tie, a good dark suit. Nick was wearing his best suit too, which Laura had picked out for him at Brooks Brothers in Grand Rapids.
“Muldaur give you any sense of what he’s here for?” Nick asked as he sat down. This was just about the last place he wanted to be, eating at a fancy restaurant when he had no appetite, being social with some strutting asshole when he just wanted to be home in bed.
“No idea. He didn’t say.”
“He told me he wanted to ‘touch base’ in advance of the board meeting.”
“Gotta be the updated financials I just sent him. They can’t be happy about our numbers either.”
“Still, no need for a personal visit.”
Scott lowered his head, muttered, “He just walked in.” Nick looked up, saw the big blond man coming their way. Both he and Scott stood.
Scott stepped around the table, went up to Muldaur, gave him a hearty two-handed shake. “Hey, bud!”
“Scotty! My man!”
Muldaur extended his beefy hand to Nick and gave him one of those unnecessarily crushing handshakes, grabbing his fingers just below the knuckles in such a way that Nick couldn’t shake back. Nick hated that. “Nice to see you,” Todd said.
Todd Muldaur had a big square jaw, a button nose, and turquoise eyes that were bluer than they’d been last time Nick had seen him, in a glass-walled conference room at Fairfield’s offices on Federal Street in Boston. Had to be colored contacts. He had the lean, drawn face of a guy who ate a lot of protein, worked out regularly. He wore a dove-gray suit that looked expensive. “So, this must be the one good restaurant in town, huh?”
“Nothing but the best for our friends from Boston,” Nick said affably as they sat down.
Todd took the big white linen napkin, unfolded it, and put it in his lap. “Gotta be good,” he said sardonically. “The American Automobile Association gives this place its ‘prestigious Four Diamond Award,’ it says out front.”
Nick smiled and imagined punching Todd’s face out. He noticed a couple being seated a few tables over and recognized them. The man had been a senior manager at Stratton until last year, when his division had been shut down in the layoffs. The guy was in his fifties, with two kids in college, and despite the best efforts of the outplacement service Stratton had hired, hadn’t been able to find another job.
That familiar sinking feeling came over him. Nick excused himself, and went over to say hello.
It was the man’s wife who saw him first. Her eyes widened briefly. She turned away, said something quickly to her husband, then stood up, but not to greet him.
“Bill,” Nick said.
Now the man rose without saying anything, and he and his wife turned and walked out of the dining room. For a few seconds, Nick stood there, his face burning. He wondered why he subjected himself to this kind of snub. It happened often enough for him to know better. Maybe, on some level, he felt he deserved it.
By the time he returned to his table, Todd and Scott were deep in conversation about the good old days at McKinsey. Nick hoped that neither man had seen what had just happened.
It had been Todd who’d insisted that Stratton replace their old CFO, Henry “Hutch” Hutchens, with Scott McNally. Nick had gone along quite happily, but it annoyed him sometimes that Scott was so friendly with Muldaur.
“Whatever happened to that guy Nolan Bennis?” Scott was saying. “Remember him?” He smiled at Nick. “Another McKinseyite. You wouldn’t believe this dweeb.” He turned back to Todd. “Remember that Shedd Island retreat?” He explained to Nick: “McKinsey always used to rent out this really posh hotel on this superexclusive island off the coast of South Carolina, for a retreat with top clients. So this guy Nolan Bennis is out there on the tennis court with some Carbide guys, and I swear to God, he’s wearing black socks and penny loafers. Couldn’t play for shit. Really stank up the place. We heard about that for months-what an embarrassment. I mean, the guy was a total loser. You couldn’t take him out in public. He still at McKinsey?”
“You obviously didn’t see the latest Forbes Four Hundred,” Todd said.
“What are you talking about?” Scott said, a quizzical look on his face.
“Nolan Bennis is the CEO of ValueMetrics. Worth four billion dollars now. He bought the Shedd Island hotel a couple of years ago, along with about five hundred acres on the island.”
“I always thought that guy would go places,” Scott said.
“Gotta love this menu,” Todd said. “Duck breast with raspberry coulis. I mean, how 1995 can you get? I’m getting nostalgic here.”
The waitress approached their table. “May I tell you about our specials tonight?” she said. The woman looked familiar to Nick, though he couldn’t quite place her. She glanced at Nick, looked away quickly. She knew him too. Not another one.
“We have a Chilean sea bass with roasted cauliflower, pancetta, and tangerine juice for twenty-nine dollars. There’s a pistachio-crusted rack of lamb with celery root puree and wild mushrooms. And the catch of the day is a seared tuna-”
“Let me guess,” Todd broke in. “It’s ‘sushi quality,’ and it’s served rare in the center.”
“That’s right!” she said.
“Where have I heard that before?”
“You look familiar,” Nick said, feeling bad for the woman.
Her eyes flitted to him and then away. “Yes, Mr. Conover. I used to work for Stratton, in Travel.”
“I’m sorry to hear that. You doing okay?”
She hesitated. “Waitressing pays less than half what I was making at Stratton, sir,” she answered tightly.
“It’s been tough all around,” Nick said.
“I’ll give you gentlemen a few more minutes to decide,” she said, and moved quickly away.
“Is she going to spit in our salads?” Todd said.
“You guys don’t need me to tell you we got a real problem here,” Todd said.
“No question,” Scott agreed quickly.
Nick nodded, waited.
“A bad quarter or two, blame it on a lousy economy,” Todd said. “But it keeps happening, it begins to look like a death spiral. And we can’t afford that.”
“I understand your concern,” Nick said, “and believe me, I share it. I want to assure you that we’ve got things under control. We’ve got a major customer coming in tomorrow-I mean major-and it looks good for signing them up. That contract alone will turn things around.”
“Hey, we can always hope lightning strikes,” Todd said. “Maybe you’ll get lucky. But let me tell you something. Corporations may be based on continuity, but capital markets are all about creative destruction. If you’re unwilling to change, you’ll be drawn into that big slide toward mediocrity. As CEO, you’ve got to overcome the organizational inertia. Unclog those corporate arteries. Free the flow of fresh ideas. Even the best boats need rocking, man. That’s the magic of capitalism. That’s what Joseph Schumpeter said years ago.”
“Didn’t he used to play for the Bruins?” Nick said, deadpan.
“There’s the quick, and there’s the dead, Nick,” Todd said.
“Well, I don’t know about ‘creative destruction,’” Nick said, “but I know we’re all basically in sync. That’s why we sold the company to Fairfield. You guys are value investors with the long view-that’s the only reason I was able to convince Dorothy Devries to sell to you. I always remember what Willard said to Dorothy and me, in the parlor of her house on Michigan Avenue-‘We want to be your partner, your sounding board. We don’t want to run the business-we want you to run the business. We may have to go through some pain together, but we’re all in this for the long haul.’”
Todd smiled slyly. He got what Nick was doing, invoking the words of the ultimate boss like Holy Scripture. “That sounds just like Willard. But you gotta understand something-the old man’s been spending an awful lot of time fly-fishing in the Florida Keys these days. Guy loves fly-fishing-last year or so, he seems to think a lot more about tarpon and bonefish than P and Ls.”
“He’s retiring?”
“Not yet, but soon. All but. Which means he leaves the heavy lifting to us, the poor suckers who have to go to work every day and do the dirty work while he’s standing in the bow of his Hell’s Bay, casting his line. The world has changed, Nick. Used to be all the big institutional investors would write us a twenty-million-dollar check, maybe a hundred-million-dollar check, and let us do our job. At the end of six years, ten years, they cash out, everyone’s happy. Not anymore. Now they’re all looking over our shoulders, calling all the time. They don’t want to see one of our major investments turn sour. They want to see results yesterday.”
“They ought to go to your Web site,” Nick said. Fairfield Equity Partners actually had an animated Flash movie on its Web site, the Aesop’s fable of the tortoise and the hare, made to look like a storybook. It was beyond cornball. “Tell ’em to check out the tortoise-and-the-hare story. Remind ’em about the long view.”
“These days, the tortoise gets made into turtle soup, buddy,” Todd said.
Scott laughed a bit too loud.
“Don’t worry,” Nick said, “that’s not on the menu.”
Todd didn’t smile. “The kind of companies we like are healthy companies that are growing. We don’t believe in catching a falling knife.”
“We’re not a falling knife, Todd,” Nick said calmly. “We’re going through some adjustments, but we’re on the right path.”
“Nick, the quarterly board meeting is in a couple of days, and I want to make sure the board sees a comprehensive plan to turn things around. I’m talking plant consolidation, selling off real estate, whatever. Creative destruction. I don’t want the board losing confidence in you.”
“Are you implying what I think you’re implying?”
Todd cracked a victorious smile. “Hell no, Nick! Don’t take me the wrong way! When we bought Stratton, we weren’t just buying some outdated factories in East Bumfuck, Michigan, with equipment out of 1954. We were buying a team. That means you. We want you to hang in there. We just need you to start thinking different. A balls-out, warp-speed effort to come up with a way to change the trend line.”
Scott nodded sagely, chewing his lower lip, twirling a few strands of his hair behind his right ear. “I get what you’re saying, and I think I’ve got some interesting ideas.”
“What I like to hear. I mean, hell, there’s no reason for you to have all your components made in the U.S. when you can get ’em at half the price from China, you know?”
“Actually,” Nick said, “we’ve considered and rejected that, Todd, because-”
Scott broke in, “I think it’s worth taking up again.”
Nick gave him a black look.
“I knew I could count on you guys. Well, who’s up for dessert? Let me guess-the dessert trend that swept Manhattan in 1998 has finally made it to Fenwick: molten chocolate cake?”