May 1 wasn't just another day in the life of Southwood (Woody) J. Morcott. For the first time in 37 years he no longer reported to Dana Corp., where he started his business career as an assistant director of corporate relations in 1963, rising quickly through the ranks to president and CEO and COO in 1989 and chairman as well in 1990.
Last year he relinquished the CEO post to President Joseph M. Magliochetti, 57, who now succeeds him as chairman after his retirement.
A 33-year Dana veteran, Mr. Magliochetti has been groomed for the top spot for several years. He is only the sixth chairman since Dana became a publicly held company in 1916.
"We've done a ton of work to prepare Joe," says Mr. Morcott. "He has the demeanor and all of the qualifications to do the job."
Major management changes at the big automotive components manufacturer based in Toledo, OH, are not taken lightly. Dana has a policy of promoting from within, so outsiders - unless they arrive from acquired companies - are all but non-existent. Mr. Magliochetti spent a year at Victor Corp. before Dana acquired it in 1967.
Mr. Morcott, 62, says he began thinking succession a decade ago when he won the top spot. Although by most measures he shaped Dana with his own brand of people-oriented leadership, Mr. Morcott won't retain any official ties with the company. "I don't believe in looking over anyone's shoulders," he says, "but Joe can call on me if he has an assignment."
It's natural to look back at one's legacy after a long career. Mr. Morcott cites Dana's focus on growth in revenues and profits during his watch, and Dana's emergence as a global powerhouse.
The numbers support this view. When he took over, Dana's annual sales totaled $5 billion. In 1999 Dana far surpassed his original target of $10 billion by 2000, reaching $13.2 billion in sales.
Dana now ranks No.127 on the Fortune 500 list of U.S. companies and No.340 on Fortune's Global 500, clearly enjoying a place in elite territory.
Since 1997, Mr. Morcott has shed numerous marginally profitable businesses that didn't fit with its long-term strategic plan - $2 billion in all. During his tenure at the top, Dana acquired some 55 companies, many abroad.
Today Dana has 330 facilities in 32 countries employing 82,000 people. Mr. Morcott didn't hit his long-term target of a 6% return on sales (ROS), but in 1999 Dana's ROS reached 5.1%, up from 4.7% the prior year.
If Woody Morcott has a major disappointment it focuses on Dana's share price on the New York Stock Exchange. Dana's shares sank 27% from $41 to $30 during 1999, and in mid-April were also hovering at $30.
In the company's '99 annual report, Messrs. Morcott and Magliochetti attributed this malaise to investor abandonment of "value stocks" like Dana's "for technology and Internet stocks. In fact, our entire sector took a beating," they wrote, although underscoring that "history tells us that investors will again return toward them (blue chips)." There is growing evidence that they may be right. And to help its cause, last year Dana repurchased $100 million of its shares, and in February expanded its repurchase bogey by $250 million.
All of this high finance was far in the future for a young man born and raised in small town Covington, GA, 30 miles east of Atlanta.
Woody's father had a general insurance agency and sold real estate. His mother earned a master's degree in child psychology. Both parents died in 1997 after 65 years of marriage.
He still returns to Covington "for gut checks," he says. His father was active in Boy Scouts and helped build a 6,000-acre camp near Covington. Woody advanced to Eagle Scout and holds a Boy Scouts of America Distinguished Eagle Award. "I learned a lot about leadership in the Boy Scouts," he says.
Those skills were honed during three years as an artillery officer in the early '60s and at Davidson College in North Carolina and the University of Michigan, where he completed the MBA program (in 1964) in just 12 months - half the typical schedule.
During his college days he held a variety of jobs, including selling Kirby vacuum cleaners in Charlotte, NC, making $50 on each sale. His Georgia drawl helped when he applied for a summer job in the late '50s at the Castle Park resort near Saugatuck, MI, where he met his wife, Cindy. They were married in 1959.
Mr. Morcott's 1999 remuneration totaled $2.5 million. When he started at Dana, however, he reckons he was worth $1,000. "I owed the bank more than my net assets," he says. "A Ford Anglia was my only possession."
Now in retirement he can afford to do whatever he likes. He serves on three corporate boards and may join others and possibly do some consulting. But after years of heavy travel that "would choke a horse," Mr. Morcott plans more time for some of his avocations, including hunting, boating, fishing, hiking and golfing, trying to lower his respectable 12 handicap.
Still, "the phone keeps ringing," he says.
