... FOREST IN UPSTATE NEW. YORK THAT THE COMPANY CULTIVATES AND HARVESTS TO SUPPLY ITS FACTORY AND WOOD SHOPS. ... ness in Oneida in the early 1800s. ... kitchens of the burgeoning number of Central. New Yorkers ...
DEEP ROOTS
APRIL/MAY 2011
IN CENTRAL NEW YORK
Harden Furniture CEO Greg Harden’s office desk is sturdy and well-crafted but not imposing or shiny. It’s not as impressive as the new conference table the Oneida County furniture maker just shipped to the Roosevelt Room in the White House in Washington, D.C. It’s certainly not as ornate as the chairs Harden crafted for the U.S. Capitol’s visitor’s center or the furnishings it made for the Federal Deposit Insurance Corp. or a slew of private clients. Those pieces began as trees somewhere on the 20,000 acres of forest in Upstate New York that the company cultivates and harvests to supply its factory and wood shops. u
Harden Furniture factory in McConnellsville, NY.
All photos by Dick Blume/The Post Standard
Charles S. Harden Sr., the company’s originator, had an adventurous spirit but finally returned from the West to Upstate New York and started Harden Furniture. Frank S. started working in his dad’s sawmill as soon as he was able, making and packing shingles.
Harry became president in the late 1930s and served until his death in 1950.
Dave Harden became president in 1955 and served until 1992.
Greg Harden was elected president and CEO in 1992.
Greg Harden is the fifth generation of his famly to lead the company, which was founded in the 1840s.
The logs passed through the Harden sawmill and down the line of its cutting, aging, inventory, inspection and crafting rooms before the wood became components to be fitted together. Then came staining and lacquering and other elaborate and time-consuming processes. Dozens of trained eyes and hands examined each piece of wood and screw and fixture as the parts moved from room to room. Weak and damaged pieces were set aside while the parts that approached perfection moved onward. Harden’s desk traveled that same route. It was brand-new when he moved
to the headquarters office after joining the company as a salesman in its Philadelphia branch in the 1980s. The company then was owned by his relatives, including his father. It still is. Greg Harden is a co-owner now, along with 13 other family members. His office sits just behind the reception area at the Harden factory in McConnellsville. It looks the same as any office along the long hallway. A 6-foot tall adult would have to scrunch his or her knees to take a nap on the office floor. Bookshelves and filing cabinets line the walls; it’s a pretty small office and the desk takes up most of the space.
It’s traveled with Harden on his sojourn up the Harden organizational chart. Harden’s desk is a good place to begin contemplating the company’s situation and his. Greg Harden is the fifth generation of his family to lead the company, which was founded in the 1840s. The world has changed profoundly since then, and Harden Furniture has too. But some things rooted in fine craftsmanship and continuity — like Greg Harden’s desk — remain the same. The company’s mission is to stay nimble in a global economy but preserve the traditions that infuse value into its brand. Harden says
HARDEN FURNITURE’S FIVE GENERATIONS The company was founded in the 1840s by Charles S. Harden Sr., whose family moved to what was wilderness in Oneida in the early 1800s. Harden worked at various jobs in the Midwest and prospected for gold at Pikes Peak before settling in McConnellsville and buying a sawmill on Fish Creek. Charles’ son, Frank S. Harden, was a teacher and moonlighted at the sawmill as the company expanded its line of furniture to
parlor chairs. Its first chairs were for the kitchens of the burgeoning number of Central New Yorkers who came here as industries bloomed and the Erie Canal provided swift transportation. Harden became the second generation of his family to lead the company. Frank’s son Harry Harden became the third generation, rising to company president in the late 1930s. His legacy to the company was to increasingly use the native black cherry wood found in Upstate New York, a material that became its signature for case goods.
Harry Harden died in 1950 and his brother Charles Harden became president. Harry Harden’s son Dave Harden, the fourth generation, took over as president in 1955. Dave Harden served until 1992, when his son Greg Harden was elected president and CEO, representing the fifth generation. Source: Harden Furniture
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his company’s approaches to solving the perils facing a family-owned business are changing with the times but still reflect his family’s values. THERE ARE THREE major pitfalls that family-owned businesses must avoid to survive from generation to generation, according to a 2007 article in the Graziadio Business Review, a publication affiliated with Pepperdine University in Los Angeles. They are failure to document the terms of its operating agreement in writing and ensure that any agreements address all issues, including divorce; ignoring financial responsibilities in the event of quarrels among family members; and failure to plan for the future, especially succession. Greg Harden says his company works hard to avoid those pitfalls. He describes his company’s corporate structure as “flat.” He’s not a big fan of having six layers of management and would prefer that everyone, from the boardroom to the room where they store the boards, work as a team. “Titles are not important here,” he says. “We try to have a lot of transparency. Folks on the (factory) floor understand what’s happening at the top level.” About 300 people work for Harden now, down from a high of around 500 four or five years ago, he says. The jobs include those that demand specific skills: woodcarvers and foresters, accounting and worldwide marketing in a digital age, and furniture designers and technicians who can program computer-guided machines that make ultra-precise cuts and use every possible square inch of the available wood. “It’s a great group of people,” he says, that takes pride in what they do. About a half-dozen executives — many from outside the Harden family — function as department heads or vice presidents, Harden says. He meets with the group regularly to hear reports and plan business strategies. That group includes the chief financial officer, the director of purchasing, the top designer, the head of human resources, the chief of manufacturing and the directors of sales and marketing for the commercial division and its residential counterpart. Harden is the only family member who is active in managing the business now. His father, who ran the business for decades, still lives in the area, he says, but isn’t involved in the day-to-day affairs of the company. The company shareholders, including
New Construction circa 1937.
Harden, meet from time to time to discuss major company issues. None of those directors, he says, who span three generations, holds a majority of ownership. Harden CFO Rich Shaw says that seven or eight of the shareholders are active on the board, which meets three or four times a year to hear reports and ask questions about strategies and issues. Those shareholders/directors would choose a new CEO when the time comes, Harden says. If necessary, the votes would be weighted according to the percentage of share ownership. Each of the shareholders signs a contract upon acquiring the shares. It gives the company the right of first refusal whenever the shares change owners — for example, if the shareholder wanted to liquidate his or her shares or if the shares were about to change hands in a divorce settlement. As for the next generation of Hardens who could enter the business, Greg Harden says there are now nine cousins in various stages of growing up. He guessed that one or two of them might be interested in joining Harden. His own children are growing into adult-
Cutting and skidding logs circa1921.
hood now, he says. Daughter Alexandra, 25, a Colgate University alumna, works at event-planning company IQPC in New York City. Son Brad, 23, a graduate of St. Michael’s College in Vermont, works at State Street Bank in Boston in wealth management. And youngest son Max, 21, who will graduate from St. Michael’s in May, is looking at attending an architecture school for graduate work. Each of them has similar talents in business, Harden says, and different talents as well. In any case, Harden thinks that it’s a u
Harden truck — circa 1920.
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great idea that a potential successor to the top job in a family business work somewhere else early in his or her career. “Let somebody else introduce them to the cold, hard world of business and learn things elsewhere that they can bring back to this business,” he says. The company will soon begin talking about the process of identifying a possible successor for the top job, Greg Harden says. A recent conversation with a cousin convinced him that the time is ripe. Harden is 54 and is not looking at retiring early, he says. But he says he can see the wisdom in starting family discussions about who and what comes next, especially given his path to the CEO job. Harden’s first workdays at the company involved tramping the woods with logging teams as a teenager and learning the various jobs in the cutting and milling rooms. He graduated from Colgate in 1978 with a degree in political science and a good taste of the competitive world of intercollegiate golf. While at Colgate, “I didn’t have a burning interest” in joining the family business, Harden says. After graduation he lived in Northern New Jersey and worked at Huffman Koos, which was the New York City area’s largest furniture retailer, managing the company’s customer service operations. “It was a great way to cut my teeth,” he says. He eventually joined Harden in 1982 and began work at headquarters in 1985. Advancing age and declining health would soon take its toll on the Harden family and its involvement with the business. Harden’s mother died in 1991, and shortly after that his father, Dave Harden, suffered a stroke. Dave Harden had become president of the company in 1955 and served until 1992, when Greg Harden was elected president and CEO, the fifth generation of Hardens to lead the company since its founder began making chairs in McConnellsville in 1844. Dave Harden still serves as chairman of the family shareholders’ board. But the changes at the top in the early 1990s were swift. In the course of 18 months, Greg Harden recalled, he moved from being sixth or seventh in the company structure to the top rung. Simultaneously, he says, changes were happening to the management team. Some
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executives left the company and others were reassigned. Meanwhile, his older cousin, Terrence “Terry” Harden, was moving steadily up the corporate ladder at the company, Greg Harden says. Terry Harden, who had earned bachelor’s and master’s degrees in engineering, had risen to posts as corporate secretary, environmental engineer and transportation director. But Terry Harden died suddenly of a heart attack in February 2000, Greg Harden says. It was just one more example of how the best-laid plans at a family-owned company could be derailed in an instant. He says he plans to be involved as the next generation enters the company. His father, he says, put a lot of energy into structuring the company but not a lot into what Greg Harden called “personal development.” “Mentoring did not come naturally to him,” he says. “I spent a lot of time figuring it out for myself.” He’ll be sure to remind himself not to micromanage the progress of the next generation, he says, smiling. u
Harden Furniture plants, conserves and harvests the lumber for its products on thousands of acres of its own woodlands and prepares the wood in its on-site sawmill.
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ABOVE, Joe Marsall sharpens a 40-foot band used in the sawmill, where the log is cut into pieces of rough lumber and trimmed for optimum wood quality. Throughout the sawmill process, defective boards and wood scraps are removed from the line and forwarded to other manufacturers of wood products or to the furnace for fuel.
LEFT, Harden owns 10,000 acres of forest in Upstate New York, leases thousands of other acres and has its own forestry division. The company is a founding member of the American Tree Farm System.
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Shaw says that Greg Harden has told him that he wants to make sure his children are prepared to make their own decisions about their careers. The 1990s were good years for the business, Greg Harden says, but the recession has squeezed it as it has other American firms. Another trend that has transformed the U.S. furniture-making industry is the growing reliance on overseas factories and the importing of materials, Harden says. He says that 600 American furniture factories have closed in the last decade as foreign competition has heated up. The company pondered whether Harden should take advantage of favorable monetary conditions abroad and begin importing goods, he says. But although the company imports a few items, the vast majority of its materials and goods (a 2010 online blog item by Greg Harden says 95 percent) are from local sources. It was a crucial choice to stay focused on local manufacturing, he says. “Everything that made our brand distinctive was tied to our domestic manufacturing,” he says. The company decided that if it began outsourcing, “we’d lose so much of our uniqueness.” But Harden still has its eye on markets abroad as export destinations. Turkey, the Middle East and Russia lately have been fertile markets for Harden furniture, he says. Harden is not only exploring emerging markets for its products, but it is also spotlighting its long history of respect for the environment. Sustainability is a virtue to consumers who demand more sustainability and “green” features. The company says it is unique among U.S. furniture makers because it plants, conserves and harvests the lumber for its products on thousands of acres of its own woodlands and prepares the wood in its onsite sawmill. Sound conservation practices have guided the company for more than 150 years, the Harden brochure says. Harden owns 10,000 acres of forest in Upstate New York, leases thousands of other acres and has its own forestry division. The company is a founding member of the American Tree Farm System. It participates in an industry movement, the Sustainable Forestry Initiative, and must pass a third-party inspection each year to remain certified as a member. The initiative certified the company in 2002 and was recertified to the new standard in 2010.
Dan Dorn puts fabric on a chair at Harden Furniture.
The company takes its “green” role seriously. It aggressively recycles or reuses many of its manufacturing byproducts, avoids toxic finishes, saves the environment even in its shipping policies and makes products that can last long beyond one lifetime and can be naturally returned to the earth when they have outlived their usefulness. A blog item by Greg Harden says that the McConnellsville facility uses zero fossil fuels in its manufacturing process. The company uses leftover wood products to power drying ovens and provide heat and energy elsewhere on the McConnellsville campus. Centuries-old approaches to woodworking exist side by side with computerized machinery at Harden; new ideas that come from afar seem to blend well with the company’s traditions. A COLLEGE PROFESSOR who studies what makes family businesses succeed thinks there is much that they can learn from non-family companies. Research shows that 77 percent of new businesses involve more than one family member from the start and that an additional 3 percent become a family affair within the first year, according to Pramodita Sharma, Ph.D., a professor at Concordia University’s John Molson School of Business in Montreal. Many, especially the more progressive ones, follow the advice that family businesses establish clear lines of authority, strategies and responsibilities, she says.
Sharma teaches a course that attracts students who one day hope to join or start their own family businesses. Among the advice she gives them is to find a job after college outside the family firm, she says. “We encourage them to take a detour for a few years and develop their talents” away from their family’s business, she says. u Continued on page 8
ABOVE, Joseph Hilts, in the background, uses a lathe to make feet for sofas. CEO Greg Harden says he's not a big fan of having layers of management and would prefer that everyone work as a team. "Titles are not important here. We try to have a lot of transparency. Folks on the (factory) floor understand what's happening at the top level."
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RIGHT, Tina Storace sprays a table in the finishing area. The company's 21-step finishing process, from initial sanding and staining to the final hand-rubbed finish, ensures each piece meets a strict final inspection for clarity, depth of color and satin-smooth finish
Sheila Hall assembles a drawer.
RIGHT, Norm House upholsters a chair. Harden upholstery features kiln-fried hardwood frames, doubledoweled and glued joints and eight-way hand-tied springs. Trained specialists in upholstery work with a variety of furniture styles, cushion types and upholstery treatments, with several graded-in fabric and leather programs.
About 300 people work for Harden . The jobs include those that demand specific skills: woodcarvers and foresters, accounting and worldwide marketing in a digital age, and furniture designers and technicians who can program computer-guided machines that make ultra-precise cuts and use every possible square inch of the available wood.
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Larry Fox cuts fabric.
Barton Cable makes parts for a chair.
That gives new generations a chance to experience the business world outside the family-owned company, something that can add to their perspective, she says. Two of the biggest keys to success for a family business, she says, are professionalism and the ability to meld the best features of family and corporate relationships. Shaw says that Harden’s board is keenly interested in the company’s human capital. The average employee has worked there 23 years, he says, and there are 50 employees who have more than 30 years with the company. When the economy led to a series of layoffs at Harden in the past few years, Shaw says, the board members wanted assurance that the former employees were faring well and that morale in the shops stayed high. All that contributes to quality, not just in the products but also in how they are made, says Shaw, who joined Harden in 2008 after working for other local firms for 18 years. That reputation for quality is a huge part of the company’s assets in the marketplace, he added. Building such a reputation, he says, is a painstaking process not unlike the attention to detail seen on the Harden factory floor — and in the CEO’s office — every day. “Greg could be the CEO at any company,” Shaw says, “not just because he had the right family name.” AS FOR WHY Harden hasn’t traded in his well-worn office desk for a new, shiny one, he doesn’t see the need to turn away from something that ought to last decades, or even centuries, if its owner uses it well. And there’s a point to be made. “When you are the owner, you have to be frugal with the company’s resources,” he says. By Walt Wasilewski/Post-Standard
Connie Little sands a door front for a china cabinet.
Jan Waterman assembling a cushion.
Warren Dingman assembles a nightstand. Furniture inspector Mary Lou Alguire checks one of the finished pieces. Dozens of trained eyes and hands examine each piece of wood and screw and fixure as the parts move from room to room. Weak and damaged pieces are set aside while the parts that approach perfection move onward.
On most Wednesdays at 10 a.m., Harden Furniture conducts a free tour of its facility, starting at the showroom. The tour usually takes approximately two hours, depending on the number of questions and the information requested. Visit www.hardenfurniture.com for more information.
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