The first quarter century was good to Rod Hershberger and PGT Industries Inc.
From the company’s 1980 co-founding by Hershberger until several years ago, the custom window and door manufacturer had never experienced a round of layoffs and was able to guarantee 40-hour workweeks for all of its employees. In 2006, the company peaked with annual sales of $372 million.
Then the housing market started to crumble, and the entire economy followed shortly thereafter. By the end of 2008, the entire country was headed into a major recession. Sales started drying up for PGT Industries, plummeting to $166 million in 2009. It forced Hershberger and his leadership team to make some tough decisions.
“We were able to guarantee 40 hours and no layoffs for everyone, but when the housing starts dropped by 90 percent, we had to change that policy,” says Hershberger, the president and CEO. “That policy was one of the strong pillars that our employees believed in, that there was going to be a lot of job security, and that changed. It was very difficult to make sure that we could continue to be a profitable company that could give our employees a lot of autonomy and freedom.”
Over the span of several years ending in November 2009, PGT Industries slashed its work force by half — from 2,600 to 1,300. Approximately 1,000 of the jobs were cut through layoffs, the remainder through other forms of attrition. The deep cuts threatened to eat away at the culture that Hershberger had worked nearly 30 years to develop and maintain.
“I’m not naive enough to think everything is going to stay the same as it was 30 years ago or even five years ago,” Hershberger says. “But there is a base culture of teamwork that we have to maintain, and we had to make decisions with the underlying theme that our culture can’t be damaged even though we’re going against the things that our culture tends to represent.”
Through it all, Hershberger needed to address the problem that so many business leaders have had to address over the past two years: how to deliver potentially morale-destroying news to your company and how to pick your company back up and dust it off before too much time has passed.
