History
In 1960 the Wilson Brothers, Bob and John, started Wilson Brothers Limited. This Canadian company
manufactures and distributes various lines of prepared food products for the Canadian market from a
number of plants, with the head office located in Brandon, Manitoba. Bob was just 23 years old at the
time and John was 21. In the first year of operations the sales volume for Wilson Brothers Limited was
$300,000. By 2000 Wilson Brothers Limited had 6 operating plants in Canada. They had also expanded to
the western US market and had a number of plants in Europe. Wilson Export Division was responsible for
exporting product to Japan and China. In 2000 the total sales volume of the Company was over 6 billion
dollars. The company was a Canadian business success story, both at home and abroad. In addition to
the spectacular volume increases, the company was very well managed financially. It had no reason to go
public to raise capital as it financed all of its expansion through earnings.
There were a number of reasons for the Company’s exponential growth. First and foremost, the brothers
valued hard work. They each worked ten to twelve hours per day, even in the latter stages of their
careers. Consequently, their senior and middle management group worked similar hours. Secondly, each
brother was a skilled salesman in the traditional sense. Their handshake was their bond. Thirdly, they
had tremendous ‘cultural sensitivity’. Whenever they expanded to foreign markets they recruited a local
executive to be CEO at that location so that the local culture was respected and integrated to business
practices (fostered). They assigned a Canadian executive to be VP Finance so that financial reporting was
consistent across all Company operations.
The brothers were proud of the exponential growth of the Company and were particularly proud of their
Canadian roots. This pride and work ethic permeated through the organization from top management to
the line employees in the plants. The success of this Canadian organization attracted executive and
management talent from across Canada.
Setting them apart from their competitors was the speed with which strategic decisions were made and
the flexibility by which these strategies could be implemented. Strategic decisions were made only by
the brothers. From the Vice Presidential level down, all operational choices made were in support of the
implementation of the plans developed by the brothers. Employees from coast-to-coast were extremely
proud that the Company could go from conception of a new product idea to launch of the product in the
marketplace in a matter of weeks. Similar decisions made by their competitors could take months or
even years.
The brothers controlled as many elements of the food supply business as they could. For example: they
ensured that the plants always had an adequate supply of ingredients on hand for production. They also
formed their own trucking firm, Able Distribution Limited, a wholly owned subsidiary of Wilson Brothers
Limited. In this way they were able to guarantee on-time deliveries to customers. More than 70% of the
demand for the trucking firm came directly from food business deliveries, independently operated out of
Truro, Nova Scotia.
Threats to the Business
Today the Wilson brothers know that regardless of the success their company has enjoyed over the years
and their attempts to control aspects of the business, it faces significant threats to profits on a daily
basis.
General Canadian Economic Conditions
Over the last decade the Canadian economy has seen a major deterioration in its manufacturing base
which in turn has increased unemployment and depressed real wages. So, even though inflation hasn’t
been a huge factor in the equation, it has risen at a level greater than general wage increases. One could
argue that this should have little impact on the food business as ‘food is food and everyone has to eat’,
but consumers have become increasingly more price and health conscious. In terms of the percentage of
overall family budget devoted to food acquisition, the average family spends less now than it did five
years ago. The trend to shopping at big box wholesale or discount stores such as Costco and Walmart, or
the popularity of generic brands at Sobeys or Food Basics, impact the profitability of brand name
products competing for the same market.
Competition
Significant competition exists in Canada from major companies with similar product lines. In the juice
business for example Wilson Bros would compete with Coca-Cola through its Minute Maid Division.
There are a number of other American firms that have penetrated the Canadian market attempting to
decrease Wilson Brothers Limited market share. Some of the US competition is dependent on the value
of the Canadian dollar. Competition has also stiffened overseas, particularly in Europe. Early on Wilson
Bros was often first to market with their products in many European countries, but as the market
matured, local companies saw the success of prepared foods, gauged the opportunity and began to
compete directly with Wilson products.
Pricing
The Canadian market for food producers is split into two avenues: retail sales, selling the product
through major grocery chain stores such as Sobeys; and food service sales, such as McDonald’s or Swiss
Chalet. On the retail side, major grocery chains have developed their own “housebrands” to compete on
price against Wilson Brothers products in many of their food lines. On the food service side, Wilson
Brothers is only able to maintain the business primarily on “best price” so that over time, regardless of
volume increases, profit margins tend to decrease.
Consumer Preference
In the early years the Wilson Brothers products were extremely popular, solely based on the
convenience of prepared food. Recently however, consumers are being more discerning about
purchasing convenience foods, paying close attention to such health concerns as transfats, unsaturated
fats, salt, and sugars. Wilson Brothers desserts in particular have suffered. In Quebec the market has
always been softer than other markets in Canada, and continues to deteriorate because of the
preference for ‘home cooking’.
Transportation
Able Distribution Limited, (the wholly owned subsidiary of Wilson Brothers Limited) transports raw
product to its plants for manufacture and inventory to its customers to market. However, the global cost
increases in petroleum products have been significant and with the need to keep product prices low,
transportation cost is a major area of concern for the Company.
Recruitment
Wilson Brothers has been an attractive company for Canadian executives, managers and plant personnel
to seek employment because of its Canadian roots, culture and success. However, they have had
significant issues recruiting in the Vancouver market in recent years since the cost of living in that market
far exceeds real income.
Unionization
Most of Wilson Brothers Canadian operations are non-union and for competitive reasons the brothers
tend to prefer it that way. They have always felt that any issues with an employee could and should be
dealt with directly, on a one-to-one basis. The brothers believe they need to operate with flexibility in
order to make quick strategic decisions; to develop a new product idea; and take it to launch as quickly
as they do. Labour agreements can add a level of structure and time consuming protocol that creates a
less flexible operational environment.
The Current Situation
You are brought in to the organization as Director of Human Resources for the Canadian operations. The
Company has manager-level HR representation in each plant in Canada, but no one coordinates the
overall effort. Your job, as described, is to develop and implement HR policies so that the company can
apply them consistently throughout the Canadian organization. Subsequently, you will introduce policy
to international operations, ensuring that where currently the company has non-union status, it is
maintained. In that capacity, you report to Ron Abrams, Vice President of Operations, Canada. You work
from the corporate offices in Brandon.
You discover a number of HR issues that need to be addressed. Executives and managers are hired at
starting salaries that were set primarily by their ability to negotiate their own salary rather than on any
specific salary range criteria. No policies regarding Employment Equity or Pay Equity exist. The company
has no job description, nor any job evaluation processes in place. Performance appraisals are
nonexistent below senior management, and even at that level, appraisals are informal and totally based
on an Management By Objectives style of management. Bottom line results are paramount regardless of
the behaviours exhibited by the executives and managers to get those results.
There are no bonuses in the organization except for the sales and marketing staff and they are paid
solely on sales target achievement and market share improvement. Succession management has not
been considered. Historically, if a brother determined a vacancy he would offer that position, based only
on an employee’s ability to implement a strategic objective. Often that judgment was based on a fleeting
impression. Even the brothers themselves have no plan with respect to who will replace them should
they retire.
Along with the pride of working for the company there is also a pervasive fear. At the head office and
plants in Brandon for example, employees are very afraid of losing their jobs as Wilson Brothers Limited
is the one major employer in the area. Since there are no consistent policies on any employee relations
issues; any employee at any level could be terminated at any time if he/she fell out of favour with the
owners.
The brothers attend two noteworthy team meetings. The team that includes the CEO’s from all of the
European and Asian subsidiaries meets once every three months at the corporate office in Brandon. The
purpose of this team meeting is to discuss and improve profit results. The brothers also meet once a
month with the senior executive team in Canada including the VP Sales-Retail, the VP Sales-Food Service,
the Executive VP Marketing, the VP Engineering, the VP Finance and the VP Operations. No other formal
team meetings are held in the company. There are groups that meet on an ad-hoc basis to manage new
product implementation; these employees come from Sales, Marketing, Finance and Operations.
As the newly appointed Director of Human Resources for Wilson Brothers Limited, you recognize that
there is substantial work ahead. You know that while changes are required, you are very aware that the
company has been a huge success. How will you help move the company forward? Bob, John and the
other members of the executive team will have projects and assignments for you to do in the near term.
You will gain knowledge and experience as you offer your leadership in the field of Human Resources
Management. Good luck and have fun!!
Company Details
Wilson Brothers Limited Executive Team-Canada
Bob Wilson: Co-Owner-CEO
John Wilson: Co-Owner-President
Murray Brown: Executive MP Marketing
Ron Abrams: VP Operations
Dave English: VP Engineering
John French: VP Finance
Gayle Robillard: VP Sales Retail
Diane Ouellette: VP Sales Food Service
Canadian Plant Operations
Vancouver, British Columbia (220 employees)
Old Facility and Equipment
Residential Area
No Room to Expand as Plant right on the Shoreline
Only 1 Product Produced at Location
Union Operation-IBT (Teamsters)
Average Hourly Wage Rate $ 38.02
Total Benefit Rate $ 9.51
Total Compensation Rate $47.53 (hourly only)
Calgary, Alberta (410 employees)
Large Facility, New Equipment
Industrial Area
Room to Expand
All Products Produced at Location
Non Union
Average Hourly Wage Rate $32.10
Total Benefit Rate $ 8.03
Total Compensation Rate $40.13 (hourly only)
Brandon, Manitoba (860 employees)
Large Facility, New Equipment, Head Office
Industrial Area
Room to Expand
All Products Produced at Location
Non Union
Average Hourly Wage Rate $30.05
Total Benefit Rate $ 7.51
Total Compensation Rate $37.56 (hourly only)
Toronto, Ontario (1035 employees)
Retail and Food Service Sales Office Location
Separate Plant Location-Industrial Area
Room to Expand
One Product Produced at Location
Unionized-UFCW-United Food and Commercial Workers
Average Hourly Wage Rate $34.10
Total Benefit Rate $ 8.53
Total Compensation Rate $42.63 (hourly only)
Montreal, Quebec (300 employees)
Medium Sized Facility, Industrial Area
Room to Expand
Two Lines Produced
Non Union
Average Hourly Wage Rate $30.05
Total Benefit Rate $ 7.51
Total Compensation Rate $37.56 (hourly only)
Halifax/Dartmouth, Nova Scotia (280 employees)
Medium Sized Facility, Industrial Area
Room to Expand
Two Lines Produced
Non Union
Average Hourly Wage Rate $30.00
Total Benefit Rate $ 7.50
Total Compensation Rate $37.50 (hourly only)
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