The recent obituary notice for James H. Wiborg probably didn’t draw a lot of attention in the business community. Wiborg hadn’t been active on the local business scene for a while, and some of the companies he ran or invested in are no longer based in this area or have changed significantly.
Then again, Wiborg wasn’t big on drawing attention to himself even when he was the chief executive or major investor in a portfolio of Northwest companies. In contrast to the current era of “hey look at me” celebrity CEOs, Wiborg’s style of operating was far more understated.
Wiborg’s lower profile can also be attributed to the kinds of companies he was involved in — doing necessary but unglamorous work in sectors such as industrial distribution, businesses whose customers were other businesses and thus unlikely to be noticed by consumers no matter how large they were.
But Wiborg’s career is worth attention, rich as it was in lessons and reminders about not just running but structuring a business to last beyond next quarter’s numbers.
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If there’s a school of business operation that favors consolidation and conglomeration, then Wiborg was a professor, if not the dean, of the opposite school. Consolidation and conglomeration have been around for a long time — in the 1960s the trend was to build big companies made up of dozens of subsidiaries with no connection to one another, not even sharing the same industrial sector. In a sense, Warren Buffett’s Berkshire Hathaway is a throwback to that era, with its grab-bag of investments in everything from reinsurance to railroads to candy.
The contemporary version can be seen in tech conglomerates such as Google and Microsoft, frenetically buying up smaller companies to add products and services, plug holes in their existing offerings or get into new lines of business.
Just as consolidation and conglomeration go in cycles of popularity, so too does the opposite approach. The trend now is for “activist investors” to target a company and pressure management to buy out shareholders, spin off pieces or break up the entire enterprise.
But those campaigns are designed to generate a quick score and some lush investment-banking fees. In a handful of cases the break-up, spin-off or move to private ownership is followed in a few years by a recombination of some of the pieces or a public offering (again with some nice fees attached).
That wasn’t Wiborg’s style. His philosophy was to pare away pieces of companies that were distractions of management focus and company resources, setting up those pieces as newly independent companies whose managers could concentrate on making those slimmed-down companies operate most efficiently and effectively. And he was patient about seeing the results.
Momentum Graphics, a wholesaler of graphics products and textile supplies, was spun out of VWR, which retained its scientific equipment supply business (it also moved its headquarters from Bellevue to the Philadelphia area). Momentum got off to a rocky start, with several suppliers pulling their products because of the addition of competitors’ lines, and because of a recession.
In a 1991 interview, Wiborg said the split of the companies made sense because Kodak, one of those that pulled its graphics products from that side of the business, was a major customer of the scientific equipment side. “It was a conflicting position in our company,” he said. Disappointing initial results for Momentum aside, Wiborg said the decision to split the two would eventually prove to be the right one, once the economy recovered.
In fact Momentum did rebound — and then split, with the textile supplies and graphics products businesses going their separate ways. “If you follow the history of Univar, VWR and Momentum, they’re constantly trying to focus on one core business,” said Bill Whitlow, a longtime stock analyst in the Northwest, in a 1993 interview.
Univar refers to the company that spawned so many of those successor companies. It was originally a chemical distributor known as Van Waters & Rogers (hence the VWR initials that would show up later in a company name). Wiborg’s United Pacific Corp. merged with Univar in 1966, according to an online corporate history.
Univar spun out Penwest Ltd., a Bellevue-based producer of specialty chemicals made from corn and potato starch. Penwest itself split into two companies in the 1990s, one to make coatings and ingredients for pharmaceuticals, the other to make products for food processing (such as French-fry coatings) and the paper industry. Penwest had earlier spun out Great Western Malting in Vancouver, Washington.
That’s quite a legacy for just one corporate family. It’s also an incomplete history of the business career of Wiborg, whose résumé would shame modern self-styled entrepreneurs for length, breadth, depth and success. Wiborg might not have been much for generating clips or quotes — the Internet is remarkably sparse with references to him — but those who pay attention to and learn from what record there is will find it’s still paying dividends.
Bill Virgin is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at email@example.com.