Post-Fordism and the Development of the Full Sail Brewery as a Quality Craft Brewer
The 1980's and 1990's have included large restructuring movements in businesses across the country. Many have introduced a post-Fordism taste to their restructuring in which topdown management is scrapped in favor of unique management techniques. One example is the Full Sail Brewery. Located in Hood River, Oregon just 65 east of Portland, Full Sail currently employees 62 employees (Dave Wendell, interview). Full Sail began brewing in 1987 and now produces about 70,000 barrels of beer per year. By definition, they are a "craft brewery" meaning they produce more then 15,000 barrels per year. Anything under 15,000 is termed a "micro brewery." To learn about the company, I decided to visit in October, 1999.
Throughout 1998 and much of 1999, the future of the company was in question. Full Sail's answer came on July 2, 1999 when its ESOP (Employee Stock Ownership Plan) buyout was finalized, transforming the company from being owned by a number of wealthy entrepreneurs, to only employees, who now own 65% of the company. The original owners of Full Sail own the other 35%. Not all craft breweries have taken this path though. Other Oregon breweries such as Widmer have sold out to larger companies to strengthen distribution possibilities and provide security. Yet for Full Sail, the ESOP decision reflects an evolving trend for micro and craft breweries: an extension of post-Fordism and decentralization. The advent of the craft brewery and Full Sail in the United States is evidence of a first stage in post-Fordism; Full Sail's ESOP decision reflects a continued strengthening and transformation of Post-Fordism in which an industry created by Post-Fordism moves towards the essence of the craftsmanship for which microbreweries are associated. The ESOP has also been a crafty marketing tool for Full Sail.
Fordism was a trend named after an industry revolution Henry Ford fathered at the turn of the 20th century. Ford revolutionized industry by deskilling workers so that each produced a smaller portion of a car. Production became more efficient while the worker lost a connection to the car production process as a whole. (Rifkin 1995). This same trend is deep-seated in the beer industry. For example, Miller today produces about 44 million barrels of beer each year. Workers in this large of a production process do not have the opportunity to connect with the product they produce. Their beer production process has co-evolved with other beer producers, creating a product almost indistinguishable from other shity beer companies such as Blatz, Schlitz or Budweiser. Industries such as Ford and Miller are thus able to produce more of a single unit at a cheaper price and in less time than someone such as Full Sail.
With the 1970s and 1980s came a revolution called "post-Fordism." One principle learned was that beer was not just beer. Industries such as Toyota transformed their pyramid structure of management in favor of ideas such as Japan's kaizen and lean-production (Rifkin 1995: p 97). At the same time, people began to challenge big-government and big-corporations. People opened their eyes to sexism, racism, class distinction and most importantly, the homogeneous yellow piss they were drinking. Beer drinkers began to look for import beers such as Beck's and Japan's Sapporo instead of sticking to the status quo. This is a sign that people were looking outside of the normal for local, regional or specialized products such as beer. Conversely, there was a decrease in Fordistic "umbrella industries." A magazine sales. Broad-spectrum magazines such as Life, Look and the Saturday Evening Post sales decreased at this time while the number of special interest magazines increased by 300. (Bertsch 1994: p2).
Full Sail Finds A Niche in Post Fordism
In the mid 1980s microbreweries such as Full Sail began to pop up, marketing themselves towards an increasing number of people who wanted more from beer. Catch words such as 'quality', 'distinctiveness', and 'genuine' were, and are used by micro and craft to market themselves as a company interested not only in the product but in the employee as well. This blending of quality, beer and the employee who connects the two is demonstrated in Full Sail's website.
"Despite growth and expansion, Full Sail has stayed true to
its commitment to hands-on brewing and absolute consistent
quality. While many breweries have gone to automated
brewing, Full Sail has adhered to the philosophy that it's the
people not the technology that makes the difference."(WWW.Fullsailbrewing.com).
This craftsmanship is essentially what the craft-brewing industry is about: A small company of workers obsessed with producing a highly personal and attractive product. In producing beer at Full Sail, the essence of quality is essential. To assure a quality product, the beer is made on a much smaller scale than companies such as Miller. The production process could be compared apple pie. For simplify this, lets look at the difference between a pie from Grandma or going to the store to purchase a prepackaged pie. The pie Grandma would make might not be perfectly semetrical and would not last as long since the ingredients would be fresh. More than this though, one would know that Grandma put time into creating a more personalized product. If she wanted to change the recipe because another fruit was in season, she could do so without having to change a mechanized process. A pie from the store is not the same. It might contain preservatives and have a much longer shelf life. It would taste and appear more generic, since, essentially it is more generic. The essence of the pie would change too as one would know that a person creating a product was not so much behind it as was a mechanized process of production.
The founders of the brewery, Jamie Emmerson and Irene Firmat made this decision in the face of a number of possibilities. One option was to sell out to a larger brewery. This was Widmer's decision in 1997. After brewing in Portland for 13 years, Widmer sold some of its stock to Anheuser-Busch for the security, and option to become a national brand. Full Sail employees were not in favor of this option. One reason was that they would more than likely lose their jobs. Another reason was that many felt it would be selling out (Matt Swihart interview). In an interview with Full Sail brewer Dave Wendell, Dave believed the brewery would lose some of its autonomy and character. As it stands, Full Sail is a local Hood River product with a name that represents the town as a windsurfing meca.
Company independence might be lost because of the way beer distribution works in the United States. In order to sell beer, a company must first sell to a distributor who then sells to the primary seller. The distributors are run mainly by the "big three": Miller, Coors and Budweiser. For example, a distributor might be a Miller distributor. In this case, the distributor would only sell Miller products and/or products in which Miller has invested. For a company like Widmer was interested in creating broadening their distribution, the ability to link up with a national distributor would be a bonus (Francis 1997: A01). Wendell believes this thinking decreases the quality of a product and ability for a company to be independent. For example, if Full Sail was in Miller distributor and Miller did not agree with how Full Sail was running their business, Miller would have the leverage to not sell their product. Quality, Wendell believed, is also markedly decreased with expansion. With distance comes the decreased ability to monitor how a product is cared for in being distributed. Many do not understand that beer is fragile, especially good beer. For a beer brewed in Portland, the chance that on a trip to the east coast it might be exposed to a hot spell in a train car or left on the shelf in a supermarket past its due date is more likely. This of course increases the possibility that a beer snob would purchase the product and be dissatisfied.
These are some of the reasons why Full Sail deciding on the ESOP program. The ESOP has a number of other benefits. It furthers the post-Fordism idea of retreating from large scale brewing by integrating the employee with the success of the company. It has also encouraged employee retention. Dave believes that with employees feeling more a part of the company, the already low turnover rate will remain low or drop even further. At the same time, employees feel more of an incentive to do their job well. The ESOP also has been a marketing tool, distinguishing Full Sail from a market saturated with superb regional micro and craft brews. Instead of being just another tasty craft beer, they are the ones who treat their workers well who would thus be more likely to put time and energy into producing a quality product.
From talking to Full Sail employees, the ESOP appears to have support from within the company. Assistant brew master Matt Swihart believes that with the ESOP, his everyday job activities are not changing much. Instead, it is his broader outlook on his job that seems to be transforming. In reference to his talking about wanting to someday establish his own brewery, Swihart said, "I now get the value out of the efforts I put in…I don't feel that drive anymore [to start his own brewery]." Swihart went on to say that his political views tending towards socialism are more similar to an ESOP philosophy of managing Full Sail as well. Swihart also said he believes that since the creation of the ESOP, there is more of a feeling of community in the company .
Eliseo, a man in his middle thirties who has a Spanish accent, started working at Full Sail about three years ago after being laid off from a lumber company. He seemed very pleased with his job on the line. With the new status of the company, Eliseo feels he has a new pride in his job. Unlike larger factories, employees working on the line at Full Sail are rotated around a series of eight sectors each day. For example, someone might start driving the forklift for an hour, then move on to stacking cardboard boxes of beer bottles onto a conveyor belt for an hour. This breaks up the monotony of a job that Eliseo said would otherwise drive him crazy. Also, for an area such as Hood River which relies heavily on cheap labor for picking at orchards, a job on the line at Full Sail which includes full benefits, and a four day/forty hour work week with free beer is something to hold on to.
Skeptical of Eliseo's response, I watched him and two other line workers. Their duty was to make sure the steam pressure of the capping machine was correct. This had to be precise, as too much or too little steam would mean that oxygen could find its way into the beer in the capping process. Oxygen is extremely destructive to beer. This particular capping process was for the first batch of the Old BoardHead Barley Wine, an 8.5% beer that Full Sail only releases once each year. Because it was so dense, the three had to spend some time talking amongst themselves, tweaking the machine and watching with their eyes to see if the capping was done right. These line workers were using their heads to make a judgment call on an entire batch of beer. When the capping machine was finally perfected, I watched as the workers took a few minutes to taste test this batch with Matt. A fine job indeed.
Post-Fordism is linked to the emergence of craft breweries such as Full Sail. These breweries have symbolized a backlash to the large companies producing mass quantities of low quality products such as Miller Beer. Full Sail has taken this one step further by encouraging and implementing the ESOP program which gives workers of all scales a stronger tie to the production of Beer. From my observations and conversations with employees, this program appears to be successful for reconnecting the employee with the product as well as making the company stand proud for itself and the beer drinking population as a whole.