Tidying Up the House

"Once, two and two made three around here. Now it makes six." So says Gordon Grand Jr., the lean tax lawyer who runs giant Olin Mathieson Chemical Corp. (1965 sales forecast: $875 million). Strange though such arithmetic may seem, it makes sense at Olin. Like many another manufacturing mammoth, the company overreached itself in a scramble to diversify a few years ago, found its profits dwindling as its debts increased. Olin is still pretty diversified--its 4,500 products include antifreeze, shotguns, rocket fuel, electric toothbrushes and paper for Bibles--but it has learned how to make its money stretch further. It is busy tidying up its corporate house, notably with an ambitious threeyear, $230 million plant expansion and modernization program aimed at wresting economies from its ability to do things in a big way.

Last week Olin dedicated the world's largest ammonia plant at Lake Charles, La., thus increasing its substantial stake in the fast-growing world market for chemical fertilizer. The $19 million plant will produce 1,400 tons of ammonia a day, require a crew of only 32. It should eventually enable Olin to shut down its older, more costly ammonia plant at Lake Charles, where a staff of 71 produces only 350 tons a day. To take full advantage of the need for fertilizers--the world must double its food supply by 1980 just to keep even--the company recently opened the world's largest phosphoric acid plant in Houston, is building an ammonia-based urea plant at Lake Charles.

Surrounded by Youth. Olin's five major operations are practically five different companies. Through them, Olin is the U.S.'s fourth largest aluminum producer (it was the first to raise aluminum prices, last to back down), its sixth largest chemical company and its leading manufacturer of cigarette paper. Though the company is principally a supplier to other industries, its other two divisions--Squibb drugs and Winchester-Western sporting guns--produced a third of its sales last year. All of the divisions are busy on several continents. Olin has just opened a caustic soda plant in Georgia and a sporting ammunition plant in Italy, is building a biological research laboratory in New Jersey, a plywood plant (its first) in Louisiana, and a plant in Ireland to produce an ingredient for antidandruff shampoo.

Olin Mathieson acquired most of this industrial spread at its birth in 1954, when Olin Industries merged with Mathieson Chemical Co. It has only lately begun to master it, particularly since Gordy Grand, 48, took over as president and chief executive last April. New Jersey-born, educated at Yale ('38) and Harvard Law School, Grand became G.O.P. counsel to the House Ways and Means Committee in 1948, became such an expert on taxation (he is currently president of the Tax Foundation) that Olin Industries Founder John Olin hired him as assistant in 1953, promoted him to vice president for administration the year the merger took place.

In his eight months as top man, Grand has shucked off unprofitable plants, folded the international division into other operations, promoted 50 Olin managers and surrounded himself with youthful executive vice presidents (average age: 49) whose salaries run close to his own $125,000 a year. He demands that each of Olin's divisions keep its profits within the top third of its competitive field, gives them virtual autonomy to do so. "Now we have a clear recognition of what we're doing and where we're going," says Grand. "We have taken on the flexibility of small business combined with the scale and economy of big business."

Two-Mile Walk. Grand runs his company so smoothly that he still practices a personal preachment: "It's stupid to spend too many hours a day on company business. You aren't effective if you don't have a good time." He walks the two miles from his Park Avenue apartment to a normal workday in mid-Manhattan, weekends in Greenwich, Conn., with his wife and five children, skis in Vermont, summers on Fishers Island in Long Island Sound. There is nothing relaxed, however, about Grand's plans for Olin. He is struggling to fatten the unimpressive return on investment (4.9% despite a 22% profit increase so far this year), intends to completely revitalize the lagging Squibb divisions, bring out more consumer products. He expects Olin to hit $1 billion in sales by 1967. At the company's present rate, he will get what he wants.

This file is automatically generated by a robot program, so reader's discretion is required.