ERP: Ocean Spray has spent millions on it, and may spend millions more to fix it, do you know what it is?

"Implementations of ERP systems are struggling throughout the world. They take too long, cost too much and fail to deliver the promised benefits of competitive advantage and cost reduction. Despite the promise and the high investment required to implement ERP systems, statistics show that more than 70 percent of ERP implementations, whether self-created or designed by established ERP software vendors, fail to achieve their corporate goals."  Source: Strategy and Business article

ERP, or enterprise resource planning was supposed to be the high tech solution to running the complex operations of large manufacturing and distribution companies like Ocean Spray. But its history has been anything but stellar. One of the largest pharmaceutical distribution companies, FoxMeyer, for example, spent two and a half years and $100 million dollars in an effort to improve its competitive position with rapid deliveries. Instead this company with $5 billion in annual sales went bankrupt and was sold for a mere $80 million.

Even a computer giant, Dell, spent $200 million and two years before scrapping the system. Still, companies are spending tens of billions of dollars to implement ERP systems. To learn more how and why ERP fails, and how to make it succeed, read the technically dense but excellent article called "Making ERP Succeed: Turning Fear Into Promise" by Scott Burkhout, Edward Frey and Joseph Nemec Jr. in Strategy and Business, here

Press release about ERP that   you may have missed

Ocean Spray Cranberries New Plant Cuts Deployment Time 30-50% by Standardizing on Intellution FIX Dynamics Software and Windows DNA for Manufacturing - Tuesday, February 23, 1999 HERE

Publicly traded companies
Have you ever wondered how much information is available to you about publicly traded cranberry companies? Read the most recent SEC filing from Northland here.

The antitrust suit against Coca-Cola enterprises by a small Maryland distributor has been settled out of court. B.K. Miller had accused Coke of discriminatory pricing, fraud, wiretapping and other harassing tactics. Coke countersued, claiming Miller transshipped, breaking the Soft Drink Interbrand Competition Act. As part of the settlement, Miller sold its Coke assets. Also at Coca-Cola, who is facing a racial discrimination suit, a so-called "diversity advisory council" has been former. Coke chairman and CEO Doug Ivester states "ours is an environment where all people advance simply based on their ability and performance."  Source: Beverage World 

Know your co-op: read the actual case of United States Court of Appeals For the First Circuit OCEAN SPRAY CRANBERRIES, INC., Plaintiff, Appellant, v. PEPSICO, INC., Defendant, Appellee. Click here

The case for 2^nd preferred stockholders of Ocean Spray

by Linda Rinta

Market news:

Aronia Juice, alternative to cranberry?

6/5/99:  Aronia is a berry native to North America, but no longer cultivated here. It is currently being imported from Poland. Wildland� Aronia Berry Juice Cocktail is being promoted as a healthy alternative to cranberry juice. Distribution began on the west coast last spring, but the product was just spotted in a Star Market in Massachusetts. Read more about aronia here. While BevNet hasn't rated the Wildland product line yet, it has reviewed, and given an A+, to the (SoBe) RedTea with Selinium, which derives its flavor from aronia, on bottom of page here. Read about the phenominal growth of New Age drink leader SoBe here.

Point  | Counter-point:

6/3/99 The debate continues: Follows is a letter that Bruce Lachney of Rainer Mountain Cranberries in Eatonville, Washington, wrote to Don Hatton, Chairman of the Board of Ocean Spray, which Mr. Lachney kindly shared with Stressline, and a spirited debate that has been generated on the Forum.

I read with interest the letter from T. Gelsthorpe espousing his prognosis in regards to Ocean Spray's future. It is with his points in reference that I would like to share my views and concerns.

Mr. Gelsthrope affirms that an independent Ocean Spray can not survive, that capitalization of Ocean Spray's business goodwill through public trading is the only sensible means to achieve grower equity. At best this is a dangerous proposition to realize short-term equity gain, at worst it is an ill conceived plan to reorganize the corporate entity without regard for posterity. Continued here.

Other Co-ops in the news:

650 member Coop Sunsweet Growers and Kings Canyon Corrin form partnership

Sunsweet Growers Inc. and Kings Canyon Corrin have entered into a partnership to test market the Sunsweet brand name of California tree fruit and grapes, according to a news release. Sunsweet and Kings Canyon Corrin will support sales with value- added programs. Sunsweet, based in California, is a cooperative of 650 grower/members. Kings Canyon Corrin is a privately held company that markets 4.5 million cartons of tree fruit and table grapes. See related article at the top of the page.

Gary Hanman and his Dairy Co-op makeover
Source: 5/3/99 Forbes Online
Article "Bet the Farm" by Bernard Condon

"Brand ownership is an established strategy among farmer co-ops: That's what Ocean Spray (cranberry drinks), Sunkist (orange juice) and Land O'Lakes (butter) are all about. But with brands and factories come much greater risks."

6/2/99: Hanman heads up the $7 + billion (sales) co-op, Dairy Farmers of America,  which was formed last year when three dairy co-ops merged.  Now with some 20,000 farmer- growers, the co-op is a force to be reckoned with in the $80 billion milk industry. He has turned the DFA into a hybrid cross between a food manufacturer and an ag co-op, similar in fact to Ocean Spray. Click here to read Forbes article

Cranberry Stressline Forum

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Although not mandatory, I encourage posters to sign their messages.

Longer essays will be considered for publication as Op-Ed pieces.

All of the Forum messages and replies, as they are posted,   can be viewed and responded to from

HERE

Re: Good-bye and Good Riddance
Saturday, 05-Jun-1999 15:12:17
Brace yourself. I've heard that if the board fires Bullock, which it doesn't look like they are going to do, they might bring Murphy back. Wouldn't that get our company back on its feet in a hurry!!! They say things have to get worse before they get better....
C. Winters

Enough is Enough - Tuesday, June 1, 1999 10:05 PM - Message: Enough is enough. The time is now for us to take a keen interest in our own future. I am a new grower in the co-op and joined because if the desire for "stability" in returns.....what a joke!  I have six questions that the board needs to answer and answer now. Message and replies cont. here

TAKE CHARGE -Tuesday, June 1, 1999 1:38PM - Message: Tom Bullock and the B.O.D. are giving away YOUR Company and most of the future casualties are happily taking the ride. It should be painfully obvious, to even the most ardent supporter of Ocean Spray's management team, the Co-op is coming apart and the men responsible are blaming forces beyond their sphere of control. Cont. here

Saturday, 05-Jun-1999 10:52:08
A Modest Proposal

(With apologies to Judy and Irene who do a nice job for us.)

Fellow cranberry growers! It is time to test the grass roots strength of this website! Our means have become more modest and it is time for austerity measures. I have been ruminating on the money spent during our decadent Ocean Spray annual winter meetings, and I have come up with the perfect way to save the co-op, and ourselves personally, money. And yet, we won't be sacrificing any of our fun, or for that matter, any of the vital business operations performed. Take this past winter meeting for example. Held in Florida. Peak of the season. Well, being quite well traveled myself, I have remembered a location just as exciting as St. Pete Beach, which for some reason I don't understand is off-peak as a tourist attraction in February. Have you guessed it yet? Bismarck, North Dakota!

Now for next year, we scrap the San Antonio plans and book into the Motel 6 in Bismarck. Our room rates just went from in the neighborhood of $200 a night to $36. Now compare this scenario to last winter in Florida. I (and you) helped pay for upper management's suites. They faced the ocean. I also helped pay for the Director's suites. They faced the ocean. Beautiful sunsets, I'm told. I paid for my room all by myself. I was on the other side of the building. About half my window was above ground level. My view was the grill of a Dodge Ram Van. The joke was on the people in the suites, though. Those sheer curtains couldn't keep out the moonbeams. No one got any sleep unless they had one of those black-out masks like Mrs. Howell used to wear when she took naps on Gilligan's Island. And, through some mistake, there was only one mask per suite handed out at registration time. Meanwhile, on my floor, all the lightbulbs in the hall were burned out so I didn't even have light shining in through the crack under the door. Slept like the dead. (Being used to looking out for myself, I had smashed the headlights on the Ram Van before sundown to make sure the owner didn't turn them on in the night and startle me.)

But hey I'm not really complaining about the room rates. The hotel really isn't making all that much money. They couldn't afford windows or even screens on the beachside "Pelican Cantina". Weird-colored birds kept flying through dropping feathers and what-not on to our tables during meals. I can vouch for secure windows at the Motel 6.

Now, let's think Bismarck again. First, it's centrally located in the continent, approximately in the cranberry lattitudes. Everyone can save money by driving instead of flying. Now don't think of this as a sacrifice. Think about the last time you were broke, back in your college days. Sure, times were tough, but don't you get nostalgic about all the fun you had living on the edge? This has given me a great idea how to have fun! Get this: The rusty VW Microbus competition! Jerry Garcia died a couple years back. He was the lead guy of the band "The Grateful Dead". No more Grateful Dead concerts. The market for touring VW Microbuses has crashed. Perfect timing for us. All growers wishing to particpate in this activity must arrive in Bismarck in a microbus. Winner will be judged on "most psychedelic" or "least remaining metal" or whatever WE decide. Added bonus: we can't afford to hire mechanics on the marsh any more, so nursing these vehicles cross country will be good drill for us. Plus, you meet the nicest people when you're broken down along the interstate!

What can we tour in Bismarck? Only the famous bakery that put the town on the map! Or how about the National Open Air Cold Soak Laboratory on the mall?

Banquet facilities? Hey, what's wrong with a good old fashioned pot luck? But a word of caution to the wise is in order here. Don't make a tacky "faux pas" by bringing a cranberry dish. Meat dishes may be out of the reach of our pocketbooks, but we can all still afford a dished based on more valuable commodities than cranberries, such as okra, or parsnips.

Entertainment after the big banquet? What could be more fun than an audience participation event? You know what I'm thinking! The big Wet T-shirt and Beer Belly competition down to Flabby Freddy's Grill on Hereford St!

This has got the potential to save the company 25 cents a barrel and still be more fun than any annual meeting to date.

So, let's see if we average growers have got the clout to make this come true! Start printing the T-shirts and bumper stickers!

FOLLOW ME TO BISMARCK in '00 !

signed,
Peat Farmer

Sunday, 06-Jun-1999 05:43:51

Dear Peat,
I can't vouch for Bismark, but Souix Falls is nice. They got the Corn Palace after all. I was there for a meeting. I never did get to the Corn Palace but I sure heard a lot about it! The Sheraton there had a nice Ocean Spray logo on the place mats and really went the distance promoting the products. Of course, they only had Mango Mango and Strawberry Kiwi. We grow those don't we?

I think S. Dakota is just as economical as North D. and it may be a shorter driving distance. I'm working on my van right now. Do you think we need snow tires? That could throw the budget off.

Ready for the Road

Message:
204.214.112.205 writes:

The frustration of growers is apparent when we read the messages that are being posted here on stressline. Ocean Spray management and the Board of Directors are frequently bashed here with no response from either group----isn't this telling you something? It is pretty reasonable to assume they are reading the postings on this site, but strange that they are silent. When they choose not to defend themselves one can assume they must be guilty as charged. I was a grower for O.S. for 30 years and communication was always a problem, but until the last few years the information we received was credible.

When you read Tom Bullock's letter of May 27 you quickly come to the realization that management doesn't realize they are the ones that are supposed to solve problems not create more. Read what he says about customer issues, problems with shipments, out of stock situations, and resulting CUSTOMER DISSATISFACTION. He goes on to say "These problems were primarily the result of low inventories". We want to know why these things happened, what caused them to happen, and when are you going to change things. In other words address the issues!

This will happen when a management change takes place. This will take real leadership by the board of directors. Is the new chairman capable of this kind of leadership or will he simply once again apologize for them?

Even though I am no longer an O.S. grower, I feel I have every right to criticize what is now happening to this company. Over the years I, along with others, helped build O.S. with our stock purchases. Now we want them to succeed and continue to lead the industry, and we want to be assured that our stock will be redeemed. This position is not self serving, it is only what we were lead to expect and we do.

Roy Peters