Davey Tree Flipbooks

87 86 Growth Rings to a possible merger as Davey also recognized the benefits of working together. Davey primarily sought market share in the utility line clearing segment and a strategic location in Canada for both residential and utility services. With High Tree being located on the west coast of Canada and working predomi- nantly as a utility line clearance tree company, the logical management team at Davey to oversee these operations proved to be the Davey Tree Surgery Company, which was headquartered in Livermore, California. Gene Haupt and Rick Ramsey, along with support from the home office in Kent, coordinated the sale of High Tree to Davey. As High Tree evolved, and the entire Canadian operation on both coasts expanded, the parent company from Ontario, e Davey Tree Expert Co. of Canada, Limited, assumed the lead role in developing and integrating High Tree into the Davey Company. is work took place under the leadership of vice president and general manager Blaire Sayers. Rick Ramsey, working from the corporate office in Kent, Ohio, would play an active role in assuring collaboration among all Canadian operations and improving communication between the corporate headquarters in Ohio and the consolidated Canadian subsidiary. Rod Soderstrom was named vice president and general manager of Davey Tree Services, Canadian operations, and Doug Soderstrom became vice president of operations. e acquisition of High Tree turned out to be a successful business venture: it provided most of the Davey Company's 2 percent increase in utility revenue for the year 1986. A Shift in Services and Leadership e sharp year-over-year increases in total company revenue between 1979 and 1985 slowed rather dramatically in 1986 when increasing competition cooled the utility line clearance market – the service that had been Davey's bread and butter for decades. Total annual revenue increased by only 3 percent that year as utilities trimmed maintenance expenses. Line clearing represented one of the largest maintenance costs for utility companies, and many started reducing the number of contractors' crews performing maintenance. Utility managers also started awarding contracts to the lowest bidder. Davey lost crews on numerous accounts or was forced to re-bid the cost of existing accounts at much lower rates, thus shrinking the profit margin. e utility downturn proved stressful for Davey's utility managers, who believed one could not put a premium on safe, high-quality work. Company management was convinced tree care firms that bid low to win contracts were proving destructive to the industry and the country. Low-bidding on line clearance contracts often led to decreased wages and fewer benefits for utility arborists. us, in some parts of the country, productivity decreased while the number of tree-related power outages increased. Retired Davey Company chairman and CEO Karl Warnke said strains on the service line led to some internal discord. "ere was considerable debate and strong arguments both for and against the utility service line and the amount of management time and financial support that should be devoted to this business segment," Warnke recalled in a 2019 interview. "Animosities between executives and managers from residential and utility services grew and internal collaboration was noticeably absent." Seeing the utility market challenges, company management wanted to grow other aspects of Davey Tree as fast as they could. Management started to recognize that the utility market may not be a reliable source of future growth for the company given that utilities were not building new, or expanding existing, transmission facilities as aggressively as they did in the 1950s and 1960s. Clearing space for new utility lines and maintaining rights-of-way had been a steady revenue source for the company through the middle of the 20th century, and utility line clearance remained the primary profit center for Davey Tree Surgery. But with this shift, management started to view the future to be in providing residential, commercial, municipal, and consulting services. is new perception of the company's future gained more ground with the election of Doug Cowan as president and chief operating officer by the board of directors in July 1985. Cowan's election also signaled the beginning of the transfer of company leadership to the next era of management. Many current company leaders were WWII veterans – like Joy, Haupt, Pohl and others – who had served Davey loyally for decades and now were on the eve of retirement. Cowan brought a unique perspective to the century-old tree care business. Cowan, who started in 1974 as a corporate controller in finance and was instrumental in the employee-ownership acquisition, had a bright and optimistic view of the company's future. But before he could imple- ment his vision, he would face a considerable challenge in garnering support among field employees and some top managers. Unlike Jack Joy and most other executive leaders, Cowan did not start out with Davey by trimming trees or dragging brush; he had spent his entire career with Davey in corporate functions. At first even Cowan himself wasn't sold on the idea of moving into the president's office. When Joy approached him, Cowan initially recommended Howard Eckel take the reins of Davey Tree. Eckel had started with Davey in 1963 as a sales representative and later spent the bulk of his career in utility operations. He would have easily had the backing of employees in the field along with most of the corporate leadership. But Joy recognized Cowan's passion for the company, particularly after going through the employee-ownership acquisition together, and ultimately Cowan agreed. Joy understood the task ahead of Cowan and addressed it in a letter he wrote to employees published in the July 1985 Davey Bulletin. "Employee support is really the most vital element of our success," Joy wrote. "I have the personal conviction and confidence that Doug possesses the leadership qualifications and dedication to lead our company to its full potential in the years ahead. In addition to his managerial skills, he has a commitment to the traditions, culture and ethics that have been the strength of the company through several generations." Joy also supported Cowan from a personnel perspective, as the incoming president would eventually inherit the support of Joy's executive assistant, Rosemary Nicholas. Nicholas had started with Davey in 1964 as one of several secretaries working in the stenographer's pool – a modest start to a career that would support the company's top leaders for decades. In 1972 she was promoted to serve as secretary to Jim Pohl, and then in 1975 she became executive assistant to Joy. In 1982, she would be named assistant corporate secretary. Nicholas earned the John Davey Award in 2000, exem- plifying the qualities most revered by the company's founder and the respect and admiration she had earned during the decades. A certified administrative professional, she would ultimately serve as Cowan's executive assistant until his retirement in 2006. en, she worked to transition her duties to her successor, Rachel Slippy, who would serve as administrative assistant to Karl Warnke. Cowan's attitude and professionalism would make up for any lack of specific tree care knowledge during his transition. "One of Doug's great strengths was his optimism," retired executive vice president, chief financial officer and secretary Dave Adante recalled in a 2016 interview. "He was one of the most positive-thinking people I've ever known. Doug believed that power and authority come from the bottom up, not from the top down. And he had a positive outlook for the future of an Chapter 5

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