A Stitch in Time

Despite steady sales ($2.6 billion in 1974), the venerable Singer Co., world renowned for its sewing machines, is in trouble. Its chief executive, Donald P. Kircher, 60, has recently been too ill to run the company. Profits have plummeted from a record $94.5 million in 1973 to a net loss of $10.1 million last year and another net loss so far this year of $36.7 million. The time had clearly come to find a new top man.

Last week Singer announced its choice: Joseph B. Flavin, 47, former president of Xerox Corp.'s international operations, who will take over as president and chief executive officer next month. Practical and harddriving, Flavin graduated from the Columbia University Graduate School of Business and worked his way up to controller of IBM World Trade Corp. before taking the same job at Xerox in 1967. There, he soon moved from internal controls to long-range financial planning and finally, in 1972, to the international area. Away from work, Flavin is a devout Catholic who enjoys golf and skiing with his wife and two children. He is extremely popular with colleagues for his direct manner and insistence on "teamwork rather than the one-man approach"; most of all, though, they admire his ability to reduce hard business problems to their essentials.

Says one former colleague: "He does not jump to conclusions without thinking through all the implications of what might be done. His greatest skills are financial--understanding the statistical impact on a corporation of a given course of action." Flavin says of his new job: "Basically, Singer is a sound company. Our major problem will be to determine just what it is that we're trying to do."

He will continue doing business in sewing machines, which turned a profit of $34 million last year. Singer's troubles stem from a massive diversification program undertaken during the 1960s. Under Kircher, Singer acquired a host of companies, including a maker of navigation and guidance systems and a mail-order house. Some of the deals worked out well; others have not--notably a venture into business machines.

Singer developed a line of electronic cash registers that, hooked up to backroom computers, would help department stores, supermarkets and other retailers keep track of sales and inventories faster and more accurately than ever before. Sears, Roebuck and J.C. Penney bought the line, but Singer has had unexpected cost overruns in meeting contract specifications for the equipment, and the recession discouraged other would-be buyers. As a result, the Information Systems division lost $19.6 million last year. So many managers lost their jobs in trying to turn it around that company employees nicknamed a special group of offices set aside for these executives the "cancer ward." Singer is already selling off a division making water-treatment equipment and a European mail-order business, and it has plans to drop other losing operations. Flavin's most pressing decision will be whether to sell some or all of the data-processing line as well.

This file is automatically generated by a robot program, so viewer discretion is required.