A description of the Business Planning Department during the major acquisition years gives context to the acquisition effort. I worked in this group from 1971 to 1977. In the first year or so, RJR had two separate groups working on acquisitions. It was never clear why we needed two groups. Perhaps that indicated a lack of strong central control over the process. At the time, as an analyst, it was not in my domain to challenge the wisdom from on high.
I was in the smaller of the two groups. We studied a series of potential acquisitions, none of which came to fruition. In 1973, my group was disbanded, and I was moved to the larger group. This was a younger organization that had two major functions – (1) analyze mergers and acquisitions and (2) coordinate between corporate headquarters and operating companies, working on major capital expenditures, annual budgets, and long-range plans. Bob Thompson, a very bright former corporate assistant controller, headed this group. The group of fifteen or so.
While a discussion of our personal style is totally irrelevant to the broader story of acquisitions, some of my “adventures” in this group are now amusing, if not instructive. On reflection, our style probably reflected the long-time culture of RJR without our even realizing it. I will speak only for myself on this. Others in the department might say that my description did not apply to them, and indeed, some were far more sophisticated about business than I was.
We were all a bit too old to be the hippie generation, mostly in our 30s, but the style of the day ruled anyway. That included long hair, sideburns and flamboyant clothes. Looking back, it is embarrassing to think about how we dressed in what should have been a subdued business environment. My attire included maroon double-knit slacks and ankle-high brown boots along with a wide patterned tie and a pea-green double-breasted blazer. Not exactly acceptable business attire, actually more appropriate for the vaudeville stage.
This was partly because of my inexperience, and partly because it was the South. It didn’t mean we weren’t capable, but it did matter that I looked like a country bumpkin when traveling outside our immediate area. My former associates might take exception to my description, but it was certainly accurate of my wardrobe. And maybe more accurate of some of them than they would likely admit.
But I was one of the worst offenders. Several us had rural backgrounds from North Carolina, Alabama, and Virginia, and we had no idea what appropriate business attire really was – nor was it very strictly enforced in Winston-Salem.
But when we traveled north, we surely were the butt of jokes (but seldom to our face) from our contemporaries at the operating companies when we visited. I remember so well going to Fifty Rockefeller Center to meet with the CEO and CFO of Aminoil. The three of us walked around the corner to a very nice restaurant. I had worn one of my more flamboyant outfits – a white suit carefully accessorized with white patent leather shoes and belt. I completed the outfit with a bright red tie. I’m sure this cut quite a figure in Manhattan.
Carl Matthews, the CFO who had worked in Winston-Salem, was embarrassed by my appearance. He asked, “Why on earth did you wear a white suit to New York?!” Jack Sunderland, the CEO was too much a gentleman to comment, although I am certain he had some strong opinions about how I was dressed.
I may not have learned much in the last forty-five years, but I have figured out that if you’re going to wear white in New York you need to be either Tom Wolfe or the Pope.
Years later, David Milam remarked with some accuracy unfortunately, “We all thought we were working very hard in Business Planning, doing five-year plans and budgets. None of it was worth a damn. The only thing that really mattered was keeping those cigarettes machines running.” They paid for everything and dwarfed everything else financially. If we had looked realistically at the company, we would have seen that cigarettes were what made RJR tick like a well-made clock – nothing else mattered very much.