RACINE — The SC Johnson restructuring announced in October will cut more deeply into the company’s local workforce than previously thought, SCJ Chairman and CEO Fisk Johnson told employees Friday.
SCJ spokeswoman Jam Stewart said Johnson held a town hall-style meeting Friday morning at Fortaleza Hall on the company headquarters campus, 1525 Howe St. During the meeting he said it now appears restructuring will exceed the previously announced 100 to 200 Racine area positions. Johnson said the “guesstimate” is now somewhere around 300 and possibly up to 400 positions, Stewart said.
Johnson did not give details to the group about why the number of positions to be cut has jumped so significantly from the earlier estimate, Stewart said.
The position cuts will include “voluntary and involuntary” position cuts, she said. Some positions to be affected are now open, Stewart added.
In October — also following a town hall-style meeting featuring Johnson — SCJ announced it was about to begin six months of planning to restructure the company worldwide, and wind up that planning in April.
Some specific position cuts will be made known to employees Tuesday, Stewart said Friday. SCJ is not publicly stating how many positions will be cut that day. Employees affected Tuesday will stay on for about three weeks after they’ve been told, Stewart said.
The “vast majority” of the job cuts will be announced by about the end of April, she said Friday. Some of those job cuts will not occur until the next fiscal year which starts July 1.
New job-cut numbers
In October, when SCJ said the coming restructuring was expected to cut an estimated 100 to 200 jobs, that would have been about 3 to 6 percent of SCJ’s Racine area workforce of about 3,500.
Friday was the first time the consumer products company publicly revised those job-cutting estimates. The new numbers would mean SCJ job losses in the Racine area of roughly 8.5 percent to 11.5 percent.
SCJ officials said in October that no production jobs at Waxdale will be lost, although they could not rule out other types of positions there being reduced.
Stewart said Friday that is still true.
Company officials also said last fall that no area was immune, and cuts would likely come from every function.
SCJ spokeswoman Kelly Semrau said those who lose their jobs will be treated with “dignity, respect and generosity.”
She also said then, “The important thing is we’re staying here.”
The purpose
During Friday’s talk, Johnson reiterated that SCJ is a healthy business, Stewart said.
“It’s not about cost cutting,” she said. “This is about organizational redesign and growth for the long term.”
In October Semrau said restructuring is designed to better position SCJ against the other four giants in the consumer products industry: Procter & Gamble, Unilever, Clorox and Reckitt Benckiser.
SCJ had come off of five years of record sales and profits, Semrau said then, and its last fiscal year which ended June 30, 2013, was its best ever for sales and profits.
Despite that, Semrau explained, “We’re restructuring because the industry we operate in moves quickly, evolves quickly.”
But with acquisition opportunities being scant and the main competitors being very large, brands are much more expensive than in the past, Semrau said. So, making SCJ even more profitable means the ability to set aside more cash for future acquisitions.
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Yeah... We need more unions.
Like we need a hole in our heads
king would be singing a different tune had he lost his job.
What does voluntary termination get you vs involuntary termination?
Thanks for the update!
If I wouldn't have been there, I would not believe this... Approx 80 IT employees 50 or older were invited to an informational meeting for the IT Dept voluntary termination. The silicon valley Bimbo who was brought in to outsource Racine jobs to HCL headquartered in India, explained to us how Fisk is having trouble with keeping figures/numbers straight in his head. She said the other day he was confused in talking about 3 months when it should have been 3 weeks. She also stated Fisk wasn't accurate when talking about number of employees to be terminated. If this is true that he is having difficulty with numbers, that might explain why he is making some of these decisions. Anyway, we have about 2 weeks to make an accept/decline decision on he voluntary termination, after that it will be forced non-voluntary to meet the numbers.
Thanks for the update. Keep the information coming.
Today 40 plus employees were terminated non-voluntary with termination dates in the next 1,2 or 3 weeks. Another 90 employees are invited to a meeting later this week to review the voluntary termination option. Employees targeted for the voluntary are IT, over 50. Non-voluntary included employees in marketing, sales, facilities, etc.
Agreed. I'm not even half way to retirement and I feel bad for what my kids will have to deal with
I am 58 years old and I worry about my kids and many grandchildren. The (D)'s are willing to destroy the American work ethic in order to gain votes and stay in power. They/our enemies always said they will destroy us from within, they are doing a good job sadly. I will fight to my last breath to keep what our founding fathers gave us.
Someone tell me what part Socialism had in building this greatest national experiment ever.
This is just a garbage statement. At least the Dems are fighting for worker rights and education. The Republican solution is de-regulation and tax cuts. J-Was had record profits last year and they are still cutting jobs. Wake up people... seriously wake up.
This is why worker rights are so important. Wake up people and stop voting against your own best interests.
Obama says that anyone losing their job is really freed from the shackles of working for healthcare - White House: It's A Good Thing That Obamacare Will Drive 2.5 Million Americans Out Of The Workforce
http://www.forbes.com/sites/theapothecary/2014/02/05/white-house-its-a-good-thing-that-obamacare-will-drive-2-5-million-americans-out-of-the-workforce/
Joe T...yes the EPA needs to be reigned in, but they are not the only Gov't posse that needs to be reigned in. OSHA has cost many companies their livelihood as well, not withstanding the poor slobs who lost their income, the family income maker, the kid fresh out of school looking for their first job. Folks, the U.S. Gov't has let you down and I'm glad that I did my stint and can now collect Social Security which YOU THE WORKING folks may not get a chance to do.
Don't get me wrong, I joined the Army after high school to defend and protect the Constitution of these United States, I am not "anti-America" I just hate to see where this country is headed.......ask yourself ONE question. In the broad scheme of things....can this country last another 100 years going in the direction it's headed?
This issue is much deeper than SCJ Corporate Greed...think about it and toss a shred of compassion to the companies that have to make these very difficult decisions.
The EPA once served a valid purpose, but must now be reigned in a lot. They have obstructed a lot of work from happening and jobs being created.
US Army is right in a way about the EPA. Years ago SCJ wanted to update equipment to run their lines faster but the EPA has to come in and approve that because if they develop the capacity to run "too fast" then supposedly they would cause environmental problems. So when consumers wanted more product than the EPA would allow them to produce, what choice do you think they had? Let Procter Gamble go to other countries due to the same EPA regulations while they stay behind and lose profits and competitiveness and then fail as a business? Also health care has nothing to do with this. Their plan already superseded what Obama wanted covered. The only adjustment made was eliminating the low deductible plan to avoid the Cadillac tax. And when comparing the next plans overall cost with premium, deductible and out of pocket costs, it wasn't a huge difference.
Welcome to Liberalism with a topping of socialism.
Good thing for those money making wind mills.
Some of you are commenting with knowledge and some with anger.....I can tell you all from personal experience that SCJ was forced into this by YOUR EPA. That's right...YOUR U.S. Gov't. is selling out U.S. companies so they move production overseas.
The EPA has banned some raw materials for import into this country.....the finished goods are legal because of the dilution or lower gradient of certain chemicals...but the challenge is getting the raws into our U.S. shipping docks and into the mainstream of production. SCJ and other chemical companies are chocking on the EPA. It's almost like the Ralph Nader scare of the 70's with the Pinto , Corvair and Vega.
Don't bash SCJ...this is AGAIN another manipulation of your U.S. government and the tree huggers to undermine the economy of the country that I spent 16 months in Viet Nam "
to protect and defend."
Don't get me wrong...this is a sad state of affairs for the poor suckers who will lose their jobs,
but don't blame it on the Johnson Family, if they pulled out of Racine altogether it would bring this stinky, festering eyesore to it's economic knees.
That's all I have to say about that!
Yep the EPA has forced SC Johnson to outsource their IT needs to India. What?
Maybe we oughta jus go back to before thar was an EPA. Back in the good ole days when company dumped pcps and other pollutants directly into our waterways and lakes. Then maybe the river can be so filled with these goodies that it starts on fire, er all the fish got three eyes and such.
Maybe that EPA is on to something though. Back in nam they was spraying ddt and agent orange all over the place, and maybe that was not such a good idea: seeing as how so many soldiers got cancer. Maybe every now and then a little regulation is ok.
Good point. The power goes out in India routinely. So much so, they don't even blink when it happens.
This will have a huge impact on the local economy. Hope all you Obama voters are happy. You wanted change... You got it!
HCLhttp://www.hcltech.com/ and Acumen http://acumen.org/ both on opposit spectrums are the up coming growth tools globally. Time to put the heads on straight and center and look to the future folks.
As a Famous Baseball legend once said: " The future ain't what it used to be "
And bringing in more people to participate in Industrial Civilization will only hasten it's collapse.
Always remember, Nature Bats Last: http://guymcpherson.com/
AND, The Reported Death of Peak Oil Has Been Greatly Exaggerated: http://peakoilbarrel.com/
The Elephant in the room is India's lack of fossil fuels and their need to import it with a Rupee that is losing value. When the power goes out - so do the lights and the computers. Industrial Civilization is nearing it's end, and all fiat currencies are approaching their true worth - ZERO.
The commentaries about Obamacare are just so brain dead. That has nothing to do with Johnson's reworking of their business. Those comments just show the deadness and blindness of people who constantly blog and not understanding business. As painful as it is, Johnson has gone global and has been moving towards this for years, prior to the Affordable Health Care Act. This has nothing to do with the Racine Mayor, the Govenor, the President.
Blog. Totally correct. Market forces at work. All the crying, finger pointing, and blame game solve nothing. Sounds like Kenosha in 1988. Racine will face challenges greater than they have now. Time to kill the political ill will and get a real plan for recovery going.
They did get too top heavy. Too many suits in the past decade.
In 2018 a 40% excise tax will be imposed on health insurance. A single policy over $10,200, or family policy over $27,000 will be taxed. This tax is permanent. I'm sure that Johnson's pays much higher insurance premiums for their employees, and the tax for them will be huge. Who penalizes a company for giving excellent benefits. The Democrats get the credit for this. Consumers are already engaged in future planning for their companies even though this will not happen for four years.
It's strictly a business decisions on the part of SCJ to stay competitive in the world market. Racine don't get this. Remember when American Motors shut down, and all Racine laughed and said Kenosha is dead? Well, they looked forward and progressed. Check out Kenosha and Pleasant Prairie now. Thriving and building like crazy. Racine.............,what can you say. The people and city leaders of Racine are still waiting for Hamilton Beach, Western Printing, Oster, and Walkers to start up again, so it will be like the "good old days"! With that mentality the only "good old days" coming will be Detroit style.
It seems SCJ's focus has changed ever since the major acquisitions of Ziploc, Windex and Drano. Previously, they focused more on developing their own new products instead of acquiring iconic brands. When they are back in hiring mode, it would be nice to see them select more Racine residents who will spend their money here and help improve the local economy.
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"But with acquisition opportunities being scant and the main competitors being very large, brands are much more expensive than in the past, Semrau said. So, making SCJ even more profitable means the ability to set aside more cash for future acquisitions"
The cost of developing your own new products and building a new brand has very high up front costs with a high rate of failure. Acquisitions of known brands is a better bet most days. It's how do you do both. How do you free up capital for innovation when your workforce is focused on keeping the lights on. No one is willing to pay $10 for a box of Ziploc when Walmart has a $4 box right next to it. This transformation started 10 years ago and anyone who couldn't see it, was naive. Some good people are going to have hard times.
At one point, SCJ had one of the highest new product success rates in the consumer packaged goods field.
With Walmart alone accounting for up to 25 percent of US sales volume in some product categories, it has no doubt effected all major CPG manufacturers.
It's time for a change at SCJ. Many of the employees don't have a clue what happens in the real world. The SCJ culture suffers due to the number of employees who have no experience outside the walls of SCJ. Many suffer from entitlement syndrome just becasue they work at SCJ. They may work there but you'd be suprised how many don't spend their money in Racine. As far as the Johnson family goes, they own the company, they have no shareholders and can do whatever they want with the company. Racine is finally starting to realize that.
Walmart squeezed SCJ's margins. Competition in insect control and air fresheners increased. Lack of innovation is another key problem. Cutting 400 jobs adds $40,000,000 to the bottom line I.e. Profit. Guess who the share holders are? Who benefits if the share owners now have $6B and $40M more??? Baloney. This is a disfunctional organizational issue, not financial. Believe me.
Change is difficult and can be fiery blazes! Change is painful.The times they are a changin!
You are clueless and don't understand what expanding globally means. Waxdale makes and exports products into Asia, Mexico, Europe, Canada and South America besides making it for the US. Some products you buy are made in SCJ plants in Mexico, South America and Canada because certain lines only have capability to make certain products and it is cheaper to make certain products here and cheaper to make certain products there. Distance, logistics, raw materials and shipping costs determine their strategy of what is made where also. You don't understand business. If SCJ sacrificed critical decisions to keep people instead of restructuring and only stayed local, in ten years they would be shut down in Racine. That is global economy.
We will but will downtown Racine? All the lost $$$ in spending in the few Stores left, How many will be left in 6 moths.
They probably need to do this to pay for Curt's legal bills. And the Mayor thinks this is just a bump in the road? Open your eyes Dickert!
I agree Shawn. I have worked there 13 years. Many there still live in the past instead of moving forward with the changes that must happen for the company to remain competitive. Fisk is open with people on his strategy of moving forward and he is making the right decisions for long term success. It is time to quit looking back at what Sam did. People don't realize how Fisk expanded the company globally. The profits are reaped by the people who work at SCJ and spend that money in the local economy.
Expand the company globally ?? Thats why the job situation in america is the way it is. 10 year from now it would be no suprise if there manufacturing plant is long gone. moved to mexico probaly. Ya record profits and hes cutting 400 jobs. He sounds like he realy cares
These comments are so ignorant it's painful. I worked at SCJ for close to 8 years before seeing the writing on the walls a few years ago. This isn't about Obama and healthcare or Unions or Scott Walker. More than anything it's SCJ avoiding these types of outsourcing measures while all their competitors have moved on. Many of these people are close friends of mine and I wish them all the best. SCJ needs to do this to compete in a global economy. I know this is killing Fisk but he knows he has to transform or die. He wants Racine on the map in another 50 years.
Not sure if this is true or not .but i heard the johnson arnt realy involed with the company any more. That would explain why they would have record profits and then hack 400 people.
5 Billion and he could not give up Million that he will never miss? Wow leadership!
Part of the reason why jobs are going overseas is due to the laziness, stupidity and sense of entitlement by Americans. While Indians learn technology, many Americans are off getting a liberal arts degree.
I'm not saying this is the cause of SCJ restructuring, but it definitely is a big contributor of jobs leaving the US
"This is about organizational redesign and growth for the long term.”
Lolz
Sugar coat it however you'd like.
HCL is an interesting Company - they espouse Employees First, Customers Second - however it does NOT mean what Americans would think it means - and it most certainly would NOT be anything Wisconsin Government Employees would embrace! IN fact- they would REVOLT from it!
EFCS is not about making employees happy or comfortable. I don’t even really care if employees are happy. I don’t think that employee “satisfaction” is something a company should strive for. Satisfaction is a passive state, isn’t it? Satisfaction doesn’t produce change or improvement or innovation or much of anything.
As for employee “engagement,” that isn’t much better than satisfaction. I would hope that everybody, no matter what their job is, would be alert and paying some attention to what they do, would be engaged.
http://www.forbes.com/2010/06/18/employees-first-vineet-nayar-leadership-managing-hcl.html
The Bizzare video from HCL, demonstrating "The Employees First Effect" - is a glorification of voluntary slavery to the Corporation - perhaps, OR service to others - but WHO is being served and at what cost must first be defined. Indians find the video very inspirational.
http://www.youtube.com/watch?v=_Plr_9iwMqY
It is definitely from an Indian perspective that would be foreign to most Americans. India has a huge talent pool of highly educated people who will work for very little and are easily thrown away. Such is the nature of an advanced Industrial Civilization.
HCL ISD will partner with you to manage your IT operations more effectively, with the highest return on investment.
http://www.hcltech.com/it-infrastructure-management
OR - is the World scraping the bottom of the barrel as debts become unserviceable and energy prices relentlessly increase?
Sam lived in a different time and Fisk wanted to keep his dad's ideals alive more than what needed to be done to keep SCJ alive. Fisk is doing what needs to be done. It sucks but SCJ as on organization has been living in a time long past.
What happened to being a "family company"? I bet the Johnson family will not see any losses in income. Also, how can someone be treated with "generosity " when they are loosing their income.? It is a sad day for Racine families and Johnson Wax. Sam would be disgusted.
" Honest abe - February 08, 2014 11:57 am
What happened to being a "family company"?"
curt thought it meant family sex company
Darn! What will "we" do w/out the free backpacks??
If this is a surprise to any one of you, then you are truly a fool.
Those reduced water fee perks are a %&*#$! Karma. lol
Then I can see why they are going with HCL based on the software services they support and I imagine SCJ globally is going to them from all their plants throughout the world making it consistent. My guess is their other plants already utilize HCL but that is a guess. They transfer people to and from Waxdale from other countries so a consistent IT dept makes sense if it is their goal. It is a shame for the jobs to be going but I cannot imagine the IT people being qualified to go anywhere else in the company.
Makes sense. SCJ already has consistent IT dept globally, next step is to replace SCJ employees with HCL. SCJ brought in silicone valley outsource executive to manage the transition. After jobs are outsourced, this person probably will leave and go duplicate process at another company...
"...Some specific position cuts will be made known to employees Tuesday, S......t said Friday. ...how many positions will be cut that day..." ~ 120 next Tuesday. 80 voluntary 40 not so voluntary..... High % of these going overseas to India and other countries HCL operates in.
Actually a few weeks ago the cuts started on a Monday morning when 32 employees were summoned from their work and escorted to a conf room where they were either terminated immediately or notified their position would be terminated in the next couple weeks or months. Many jobs being terminated are going to India, a company, HCL Industries will be doing the Information Technology positions (~200) from a location in oversees/India. The transformation to HCL is already in progress and should continue through June 2014.
Gee will the folks in India be coming to Downtown Racine to keep it alive ?
They are in Racine for knowledge transfer from SCJ employees and will take this knowledge back to India along with the jobs....They have a computer cap SCJ employees wear that sucks all the knowledge and transfers to Indian....
The jobs going to India are a commodity. If you work in IT you have to keep your skills current and find ways to add value. People won't pay $10 for a bag of Ziplocs. The jobs that stay are about innovation and driving value.
ggodmuls I think you are right to a degree. to remain competitive they must change and most people don't realize they began restructuring in 2005 beginning on the floor. They also have strategically placed plants across the Americas to reduce the impact of shipping charges related to oil. to those who think they would move to Mexico, they would have to ship products into US from Canada or Mexico and they don't make the same products in all their plants. It is all strategy to reduce costs globally and not just locally. their competitors started years ahead of them. if they dont make changes now, they'll be left behind. drop the panic and speculation.
Obamacare is costing employers a lot of money. I can't imagine how much a company the size of SCJ will be paying. If they had unions, this probably would've taken place 5 yrs ago. And I wouldn't call record profits, "running the company in the ground." But hey, you're an Obama voter, so I don't expect you to understand that.
Ya record profits and there canning 400 people? What a great company ..people like u crack me up .u probly shop at walmart wher hardly anythings made in the u.s .then complain how thers no jobs. People like u blame unions for every businesses downfall. But you never say anything about the ceo that raked in miliions before the company took a dump
“It’s not about cost cutting,” she said. “This is about organizational redesign and growth for the long term.”
In a post peak (straight crude) oil world the "Growth Paradigm" is over. SCJ must know the truth - at least at the top. Per capita use of energy in the US is falling - and growth is not sustainable worldwide because of falling supplies of crude and increasing costs of extraction - also the newer forms of crude - LTO, Tar Sands, Heavy oil, and Deep Water all have terribly low EROI, and the hydro-carbon mix is not optimal.
In October Semrau said restructuring is designed to better position SCJ against the other four giants in the consumer products industry: Procter & Gamble, Unilever, Clorox and Reckitt Benckiser.... So, making SCJ even more profitable means the ability to set aside more cash for future acquisitions,
Interesting. Not ONE WORD concerning bike paths, marsupial bridges, fancy Downtown sidewalks, DRC, RCEDC, Public Skools, round abouts, Rootworks, Osterman Granite and Tile, Jim Ladwig's empty Marina, Downtown Bars, OR all the other NONSENSE Dickert and Company talk about. NOT ONE WORD. Got that Carpetbagging Cory Mason?
P-R-O-F-I-T-A-B-I-L-I-T-I-T-Y and L-O-W T-A-X-E-S
Racine - can't compete in the global economy - ESPECIALLY in a post-peak crude oil world.
Downtown Racine is TOAST. How will all the loans - that have not generated any return - be repaid? Who can answer that question? Default is coming. Property is just a tax liability and collateral for Dickert's valueless loans.
I hope all the Obama voters go first. They're the ones who got us all in this mess. This will be a hit to our local economy.
Big hit. What stores downtown will close? Who will pay for the DRC or the other toys?
IF johnsons was a union shop im sure you would blame the unions for this. But there not so now you blame obama lol why cant you just admit that the kids are running that place in the ground.next up they will be moving to mexico.
Family companies get sold down the line. Maybe the kids have no interest in keeping this ghost town above water. If they would sell, new owners wouldn't come to Racine with their horrible schools.
Your probably right. Wonder what the Tower will scrap out for?
Welcome to the real world.i feel bad for some of these people but most johnson employees are so stuck up and treat there temps workers baf
Horrible news for everyone.
Don't worry Racine, your local elected officials have a plan to combat the non-stop downhill slide of loss of jobs and businesses in Racine. NOT!!! Racine = Number 1 in unemployment in the state for 10 years in a row and counting, Racine city hall's solution? Turn your head and act like it's not happening. It's really a shame what is happened to Racine.
Primetime, where can I find this information? I know it's most likely true, but I'd like to see the stats myself.Thanks!
Corporate cutbacks. Many already have two or three under their belts by now. Not something a person wants to go through especially later in life. Hope things turn out OK for those who hit the street.
The gravy train just rolled over on Howe Street.
Gee who will pay for the Uptown Plan or Rootworks now that Johnson will not be able too?
How many Downtown stores will close now?
Hunker down Racine this will not be fun.
Hopefully the local involuntary cuts start with those with Hope & Change (Hoax & Chains) bumper stickers on their cars.
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