Winner of the 1994 St. Louis Small Business Award, Matthews/McCoy is reaping the benefits of employee ownership.

John Marcus, Chairman of the Board Matthews/Mccoy

The text below is from an article published in St. Louis Commerce magazine.

When John Marcus hands you his business card, it doesn't say CEO, it says head coach--an unusual title for an unusual company. Traditional job titles have disappeared at Matthews/McCoy, a distributor of medical and health science books and supplies. They've been replaced by function titles like "player" and "coach".

Likewise, the company's corporate pyramid is the opposite of the traditional hierarchical structure. Head Coach Marcus is on the bottom, supporting senior coaches (vice presidents), coaches (managers) and players (front line employees).

While unorthodox, Matthews/McCoy's structure has contributed to the company's significant growth in recent years. The coaches provide the players with the information and educational support they need to make decisions. Conversely, players let coaches know what customers are thinking so they can make more informed planning decisions.

"We have internally removed the word 'management' from our vocabulary," says the coach of the marketing department, Ann Bueler.

Bueler says the company lives by the "Four R's": rights, responsibilities, risks and rewards. Employees have the right and the responsibility to do what they need to do to satisfy customers; they are encouraged to take risks to help the company grow; and all are rewarded by the company's success.

The rewards are part of Matthews/McCoy's status as an employee owned company. In existence since 1889, the company became employee owned in 1989. At the time, John Marcus, who had taken over the company from his father in 1970, was the sole owner. He gave 30 percent of his stock to an employee stock ownership plan (ESOP).

Participation in the ESOP requires a year in the company and 1,000 hours of service. Employees become 20 percent vested after three years; fully vested in the ESOP after seven years.

While the company has enjoyed steady growth since 1989, Marcus is quick to point out that it is not due to the ESOP, although he originally thought of the ESOP as a motivational tool when he first adopted the policy. He quickly learned that employee ownership is just the "icing" on the people-oriented corporate culture created at Matthews/McCoy, which he says is really the "cake."

What has really impacted growth is the company's operating philosophy which emphasizes personal development. Rather than "work hard, play hard", Marcus endorses a seamless life of work and play. He says it not only makes people happier, it also builds good relationships that ultimately improve the company's bottom line.