ASK ROGER CLEMENS WHAT HE planned to do after the Yankees lost in six to the Marlins this time of year in 2003. Real tears in Rocket's eyes would tell you his heartfelt answer. He was headed home to Texas to spend more time with his wife and four boys, whose names all start with the letter “K,” to spend more time fishing, to become a spectator of America's favorite pastime. Yankee fans wept. An American League batter or three might well have been guilty of doing the math, and fantasizing about adding a point or two to his average, sleeping free of the recurrent nightmare of a splitter that explodes into the zone belt-high and winds up in the catcher's mitt, belt-high to a worm.
Ask Bob Ladd what he was going to do when he stepped down a couple of months later, in January 2004, as head of Masco's Texwood Industries (cabinet) division, and the answer would have been almost the same. Retirement, family, a few strategic business investments; it all added up as the right thing to do, at the time.
Roger's phone rang one day, and it was new Astro Andy Pettitte. Bob Ladd's phone rang one day and it was Bill Bowerman, majority owner of Choice Homes, one of Ladd's investment interests. Same difference. Bye-bye retirement.
Now, when the CEO of a powerful regional home building company decides to up and leave, get some big league private-equity financing, and set up shop in his former employer's back yard, you might say, “Hey, good for him.” When the same CEO's exit strategy involves tapping a management brain trust directly out of the hide of the company that only a few months earlier was signing his paychecks, it raises tough questions.
Questions like: No president and CEO? No COO? No CFO? What the heck are they going to do? Sell? Go out of business?
That's why Bob Ladd and his come-out-of-retirement tenure as president and CEO at Arlington, Texas-based Choice Homes hit our radar. On the surface, it might have seemed Bob Ladd was a money guy, and a newcomer to the home building industry. In fact, he's neither.
Let's put both assumptions to rest with simple facts. In 1969, Ladd and his father started Quality Cabinets in Duncanville, Texas, with three employees. They sold it to Masco in 1997 as a critical high-quality “good” linchpin in Masco's “good, better, best” strategy, with 2,800 employees and annual revenues in excess of $150 million. Need further evidence that Ladd knows both home building and operations by heart? See contributing editor Lisa Marquis Jackson's “Change by Necessity … Reinvention by Choice,” starting on page 74.
“Business is business,” Ladd told me about the leap over to running a home building company after almost 35 years as a materials provider. The CEO role, in either manufacturer or a home builder firm, is to help “develop a focused strategy and then to provide a supportive environment to our people so we can reach our goals.”
Whatever the fallout after former CEO Wall's departure and talent raid on Choice, Ladd's message is clearly about moving onward and upward, without one serious thought about selling Choice once he's fixed it. “This was an entrepreneurial, decentralized culture, with highly capable people,” says Ladd. “As an investor, I saw opportunity in setting a strategic focus, and bringing disparate, un-focused parts together.” Immediate moves involve promoting Dan Couture and Steve Garza from within, to step up as his key go-to guys.
Now come aggressive land-position moves from the “fringes” into the “core” of Choice's competitive market areas, and the introduction within the next 120 days of a new Choice brand for the move-up market. Ladd anticipates annual revenues of $450 to $500 million in 2005, with somewhere between 7 percent and 28 percent growth in 2006. Not a company that looks like its back is against the Wall, so to speak. Rocket and Ladd will retire, someday, but not before putting up a few more Ws, and continuing to make opposing players lie awake at night.
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