Q&A WITH JIM STITT JR.

Q: Why don’t you start out by telling us a little bit about your background and some of your early days.

• I moved from Ohio to Olean, NY when I was 2 years old when my dad moved from an engineering role at WearEver Cookware to an engineering role for ALCOA aluminum.
• Around 1980, my dad was transferred from Olean, NY to North Carolina to be Plant Manager of a powdered metal factory.
• About 2 years later, when I was 10, my parents told me we were moving back to Olean, NY because my father was going to be part of the executive team with ALCAS (originally a subsidiary of ALCOA) under Erick Laine’s team. At the time ALCOA wanted out of the cutlery business.
• Erick Laine was an entrepreneur at heart and wanted to own his own business and he saw the good of the Cutco product and he saw the good in the people who were making the product and he realized that if he didn’t save the company, no one else would and the company would shut its doors and all the jobs would be gone.
• My parents kept us pretty isolated from all the struggles they were going through at this time in my life, which I give them a lot of credit for to this day.

Q: If I understand correctly, there was a highly-leveraged buyout and there was a year of having to achieve a specific goal to be able to pay back the loan.  Can you describe how that went down?

• It was a leveraged buyout which means you leverage all of your assets. Your house, car, and anything else of value.  This was a 15 year mortgage with a 3 year call-back, meaning they could call the loan to be paid in full in the first 3 years.
• Well, in 1984 the bank decided to call back their loan and it took the better part of a year to find another lender who would pay off the first loan.

Q: It’s amazing to think about all the lives that have been forever changed since that time; that it was close to almost not even being able to happen.  When was it that the specific goal had to be hit?

• That was 1984. They found another lender and the agreement was that if they hit their profit target, the lender would give them a 15 year mortgage.
• That’s when Erick and my dad and their other partners really had to lean on the rest of the employees to band together and figure out how to hit their profit plan for the year.
• The union workers passed on their wage increase that was supposed to take place that year and the salaried employees took a 10% pay cut in order for us to hit the target.
• They were able to meet that financial target, they did get the loan that was needed to save the company, and they even exceeded the financial target by about $100,000.
• They divided that money up and gave it back to all the people who they borrowed it from.
• 1984 was not only the year the business was saved, but that was the year that set the tone for the partnership, the trust, the relationship with management and our factory team and was the beginning of this wonderful culture we have in our company.

Q: I’d like to hear more about your path after all this.  So from college to when you entered the workplace, what was your path like?

• When I graduated from Olean High School I went to the University of Dayton in Ohio where I got an engineering degree.
• After graduating college I took an engineering job at Honda of America at their engine plant for 2 years.
• In 1997, I moved back to Olean and started working for Cutco again.

Q: What do you feel have been some of the key experiences that have shaped your career over the past 23 years with Cutco?

• I feel so fortunate to have the opportunity to hold a lot of different positions within our factory organization. I spent college summers working in the factory on the floor.
• I’ve held an engineering position, I did front-line supervision, I did all the different management positions, I worked my way in to lower-level executive leadership all the way up to my role now.
• So I’ve worked with a lot of people in a lot of positions and they’ve all helped to shape who I am. They’ve helped shape my problem-solving skills, my communication skills, and my confidence.
• And of course for the last 10 years I’ve been heavily involved with Vector, and that has taught me so much.

Q: I want to talk about the factory because I’ve heard and experienced some amazing things during my visits there.  I’ve heard that of the hundreds of people who work at the factory, the average tenure is something like 19 or 20 years and that’s because Cutco makes it awesome and makes it “the place to work” and people find the work to be great and meaningful.  What do you think contributes to the atmosphere and culture that creates this result and what’s it like working in the factory?

• The short answer is in how we treat each other. Respect is so deeply integrated into our culture. And it’s a family culture.
• Erick Lane is the one I credit with creating that culture. He was the leader who would walk through and get to know everyone and showed he cared about everyone.
• And when Erick and my dad leaned on them to help get through the tough times in 1984 and when they made it out of the hard times the success was shared with them and it created a real trust between management and the owners and everyone else in the organization.
• In the environment that we have, people truly come first and it’s a family-like environment. We communicate with each other and we listen and we care and we laugh and we have fun and we work hard and we get results.
• People come to work every day because they really like who they’re working with.
• We don’t make business decisions that affect our people, we make people decisions that affect our business. And if you take care of your people, your people will take care of your business.

Q: Most of the publicly traded companies are focused on short-term thinking because they’re thinking of their shareholders but as a privately held company, you can make more long-term decisions.  How do you balance that long-term versus short-term  thinking comes into play?

• The business has to be successful or it won’t be there for the people. The purpose of our organization is not profit, however financial health is very important, and we’re very mindful of profits, because there has to be a profit to keep the organization going so we can take care of our people.  If the profits aren’t there, we can’t take care of our people. We’re able to take care of our people because we’re financially healthy.  But it doesn’t mean that our purpose is profit and that’s something that sets us aside from a publicly traded company.
• It would be very difficult to do what we’re doing and to have the culture that we have in a public company but we can do it as a private company.

Q: I’d like to get into some of your own personal philosophies as a leader that you’d like to share with our audience.

• There are a few traits that I try to focus on and stay true to on a daily basis. The first one is to be genuine, trustworthy, and to have integrity. People need to respect the person they’re following and there’s 2 elements to that:
  • They respect the leader’s results
  • They respect the leader as a person. A follower needs to respect their leader’s values, what they stand for, and how they treat the follower.
• The next big thing is to surround yourself with good people. It takes a team to get it done.  No one can get it done by themselves.
• Be a good listener. If you surround yourself with good people, they have good ideas, concerns, goals, interests, needs, and you really have to listen to that.
• The 4th leadership philosophy is to have clear objectives. Having so many great people around means a lot of good ideas but the leader’s job is to clarify all those ideas and to clarify the focus so that the entire team can be rowing the boat in the right direction.

Q: Speaking of having a clear objective, what is your vision for the future of Cutco?

• The vision is sustainability and to be a company of great products and great people and be a company of great purpose. In short, how do we maximize the impact we have?
• It starts with our team. When Erick and my dad bought the company, they did it to save jobs; to save livelihoods.
• But it’s more than just having a job. It’s about having a job that allows you to pursue happiness and fulfillment.  We want our people to be able to maximize their talent within the business and be a part of something that’s bigger than themselves and have a positive impact on people around them.

Q: How do you wish for the Cutco/ Vector organization to help change people’s lives in the coming years?

• One of the great things about our organization, and it really exists within Vector, is the pursuit of personal growth and the pursuit of being the best version of yourself. And when you tie that into a culture of taking care of and serving others, what you have now are talented people who are successful and who have the ability to help take care of people around us who could use some help.
• And we give back in ways that many companies just can’t do it, but we can, and it makes me proud to know that we’re a part of what this podcast is all about, changing lives selling knives.
• Making and selling knives is the vehicle for us to create livelihood and if we create good livelihoods, with a backbone of great values, then we have the ability to impact the people outside of our business and be an example and inspire others within our world to be better. And quite honestly, our world could use a little bit more of that these days.

Q: What else is there that you feel you’d like to say to our young reps, our managers in the field, our alumni?  What would you like to leave people with?

• The biggest thing I need to say is I need to thank them. There are 2 parts to our business, we make the knives and we sell knives.
• The team that sells our product is a very important part of that equation and we wouldn’t be the thriving enterprise we are without them.

Q: As you look ahead into the future, 5-10+ years down the road, what are you most excited about?

• As I look out into the future, sustainability is important. And we live in a rapidly changing and competitive world.  And the pursuit of being a sustainable company, the pursuit of being a company that’s built to last, the pursuit of being a company that stands the test of time, is something we can’t take lightly.
• We have a great foundation with our product and our people and our values and our distribution approach. But there’s some things we have to do to stay alive in this competitive world.
• As I look at our foundation and I look at our people, it’s exciting to come to work every day and say, “we’re going to solve these problems. We’re going to make this happen. And it’s going to be a positive thing for a lot of people.”
• In the next 5-10 years a lot will change but our product absolutely fits in today’s world, we just have to figure out how to navigate our business in this world that’s very competitive and very noisy and very small and I’m just excited to see what we’re going to accomplish.

FINAL THOUGHTS

• I loved hearing how many different positions Jim has worked in the company all the way from the factory all the way up to the CEO position.
• Of course, the “people come first” philosophies of the company.
  • “We don’t make business decisions that affect our people, we make people decisions that affect our business.”
• I was struck by the idea of the difference one person can make in the lives of so many others. In this instance, Jim gives credit to Erick Lane who led the leadership team that bought Cutco from ALCOA in 1984 and just think of the impact that one decision by one person has made on countless lives.  All the Cutco reps who’ve worked since 1984. All the factory employees, some of who are still there now from way back then.
• How can you change people’s lives in your future?
• What impact can you have?
• How can you take that impact to the highest level and impact the most people in the biggest ways in your future?