Baking & Snack - March 2009 - 29

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The proof of the pudding is comparing where Lance
once was in these three areas to where it is today, according to Mr. Singer. One example he cited was for shareholder value. "Compare the value of a $100 investment in
Lance made in 2005 to its value today," he said. "It is worth
$180. This compares to the same investment amount in
our competitors being worth only $107, and in the S&P
500 market only worth $80 at the end of 2008."
Restating his point, Mr. Singer noted that internal
focus involved operational improvements and physical
expansion. External objectives include acquisition into
innovation and new product lines, capacities, capabilities
and territories as well as cost savings.
The recent Archway acquisition is part of the external focus going forward. Our DSD and supply chain foundation
allows faster integration of that business into the Lance fold,
and vice versa, Lance sees great opportunities to leverage
that acquisition, including using the capacity to support the
private label segment, according to Mr. Thompson.
EMPLOYEE FACTOR. "From an employee perspective, we
found most were anxious for change, embraced it and were
excited about its prospects," Mr. Thompson said. "That's
unusual for a 95-year-old company. You might think
employees would fight change, thinking 'Why change now?'
But our approach to change and the dedication of our
employees came together to energize effective change."
Management made a concentrated effort to communicate its corporate destination. "We could have dictated change and gotten some things done quicker, but
we wanted also to effect a cultural change for long-term
objectives," Mr. Carter noted. "So we did things on a
much more measured pace, thereby building an organization that is engaged and adaptable to change in the
future as well as now. We really value our people, not only
in their capabilities but also their ability to contribute."
An example of this contribution comes in the form
of Lance's "vision stream" approach to continuous
improvement. Vision stream is a concept that establishes an engaged environment of employees identifying
opportunities and affecting change. Structured teams
throughout the organization focus on different areas.
Each has an executive sponsor to help remove obstacles.
Cross-functional members add perspective. Objectives
include productivity, quality, safety, cost reduction and
others. "It offers real opportunity for employees to be
involved and make a difference and adds to our continuous improvement culture," Mr. Singer stated.
CHANGE CALL OUT. The major endeavors put in place
by Mr. Singer, his top management team and the entire
employee base are nothing short of amazing. "We are a
good size company, currently at around $850 million

BAKING & SNACK / March 2009

ᮡ Blake Thompson (left), senior vice-president, supply chain, and Mark Carter,
vice-president of strategic initiatives, work closely together to implement the
executive team's 1Lance initiatives.
JON SILLA PHOTOGRAPHY

compared with $565 million at end of 2004," Mr. Singer stated. "We've made great progress in a short time."
However, he said the company is small compared to the
behemoths in the food industry.
And Lance is focused on getting larger. Its recent
acquisitions of Brent & Sam's, Archway and Tom's and its
partnership with Late July (an organic bakery) position
Lance to be more effective by spreading costs over a larger
base and becoming more important to its customers.
According to Mr. Singer, a $1 billion company has more
opportunity and capability to do things than a $500 million company, and Lance wants to grow its branded and
nonbranded segments internally and through acquisition.
"The foundation we have established helps improve
profit margin by bringing down cost of sales," he noted.
"Unfortunately the unprecedented commodity increases
during the past year masked many improvements, but we
adjusted our pricing and pretty much put that behind us.
And margins have been restored."
Management believes that even with current commodity volatility in 2009 and 2010, those initiatives and cost savings will become very evident and start to show through.
"The next two years also puts us in a great position to grow
in size with little additional investment compared with the
past few years," Mr. Thompson added. "This too will result
in even better profit margins. That in turn will leverage our
returns on investment."
After three years of structural change, internal focus

Baking & Snack - March 2009

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