Look back in anger.

• Author: Bailey, David
• Position: Guilford Mills Inc. CEO Chuck Hayes' management technique - Cover Story

For Guilford Mills to face the future, Chuck Hayes had to come to grips with where he'd been.

Chuck Hayes has never hesitated to act like the boss, even when he wasn't. Take his very first job at Lee Dyeing Co. in upstate New York, where he went to work at 16 after quitting school to marry his pregnant girlfriend: "I worked myself into being in charge of quality control, and Kenneth Becker -- Jeez, what a memory -- he was on the front end."

On the back end of the machine, where Hayes stood, the fabric looked terrible. "I said, 'Cut it off.' He said, 'No.' I met him halfway, and I hit him so hard that it fractured his jaw and put him in the hospital. And then they were going to fire me, and I said, 'I just did my job.'"

He didn't get fired. In fact, he got promoted, time and again, because he made things happen by doing them his way. "They condoned my mistakes and my anger. I had this anger inside of me, I had to find releases for that."

By channeling his anger into performance, Chuck Hayes found a formula for success. It's how a high-school dropout turned Guilford Mills, a small Greensboro knitter of synthetics, into the world's largest and most efficient producer of warp-knit fabric -- material made from interlocking loops of nylon, acetate or polyester yarn.

"If you're going to succeed and you believe in yourself," Hayes, 57, says, "you go your path and you bring people with you to help you get there, and you reward them well. And if they don't focus with you, what the fuck do you need them for?"

He found people with focus, a half-dozen like-minded, similarly motivated men who helped him steal business from the big weavers and squeeze out a margin that was the industry's envy. They pushed and pummeled Guilford from a small producer of slip and sleepwear material until it swelled into a global player with a half-billion dollars in annual sales. The team was good, but it was Chuck Hayes who made it happen.

"His mind is like a perpetual-motion machine," says Bernard Fleisher, Guilford's former head of manufacturing. "He has a real gambling instinct. He has a saying, 'I came with nothing, and I can go with nothing.'"

Over the years, as Guilford's tough-talking, hard-partying president became an ever more integral part of the business, the company almost became his alter ego. He owns 10.6% of the publicly traded company ($37.7 million worth at the end of March) and runs it as chairman and CEO. But now Chuck Hayes realizes he has to distance himself from the company he built. He has vowed to step aside as president and chief operating officer by July of 1994.

It isn't the first time he has come to this conclusion. Three years ago, his personal life in chaos, he turned the company over to his hand-picked replacement. Guilford lost $8 million, and its stock dropped from a high of $39.50 in 1988 to $16.25 in 1990. Hayes had to step back in.

This time, he says he's instituting a complete rethinking, rewriting and reworking of Guilford Mills. It will involve every employee "to power down decision-making to its lowest possible level."

But many can't help but wonder whether there can be a Guilford Mills -- the Guilford Mills that Chuck Hayes created in his own image -- without him in charge. Even if the company finds a way to keep using his instincts, intuition and innovation, can Guilford do without his greatest gift: the special brand of tyranny that demands things get done his way?

He came there in 1961, lured to Greensboro as a potential partner by James Hornaday, who had started with two knitting machines in a feed-and-seed store in 1946. Guilford had grown into a medium-sized operation with 60 machines that made fabric the cheapest way on the planet, knitting it out of synthetic yarn. Hornaday wanted Chuck Hayes to set up a dyeing and finishing operation so the company could charge more for its material.

Under Hayes' guidance, Guilford Mills' aim couldn't have been truer: It would target pricey natural-fiber fabrics with low-priced synthetic knockoffs. That's not to say executives at Cone Mills and Burlington Industries stayed awake worrying about what Chuck Hayes and his team were doing. "They didn't even know we existed," he says. "We were pimples on an elephant's ass, for Christ's sake. Nothing."

Seven years after he arrived, Hayes was president. In 1971, Guilford went public. The year after that, Hayes became chairman and CEO and moved the company onto the American Stock Exchange. In 1984, it started trading on the Big Board, the New York Stock Exchange.

This was an industry made for men like Hayes -- outsiders who didn't have advantages like a well-connected family or a formal education. That's why so many Jews ended up in textiles, says Hayes, whose parents were Methodist. "The Jewish people had to make it, and how could they make it in an industry that was building steel? ... We both had the same goal in life, to succeed, to make it. You had to be innovative all the time, an entrepreneur. Textiles lent itself to that."

Hayes' cabinet was made up of highly motivated men -- Bernie Fleisher; Maury Fishman, Guilford's technical genius; Norm Weisbecker, a marketing, promotions and merchandising whiz; Lee Rosenberg, a planner and details man; George Greenberg, the company's super salesman and president from 1976 to 1989; and Paul McGarr, the company's money man.

"We all came from nowhere," Fleisher says. "Maybe that's why we were able to work together so good."

"What makes Sammy run?" asks Hayes, who was paid $480,000 in salary and bonuses during the fiscal year that ended last June 30. "He runs because he never wants to look back."

They developed into a tightly knit group who "knew each other so well that the blink of an eye would mean something," Hayes once said. "This group got married. Look at them. They all started looking alike with beards and moustaches."

And they all took their cue from Hayes, ranting and raving regularly. "Most of the inspiration to work harder was supposedly based on how loud management could shout," recalls George Stansell, Guilford's head of engineering.

Determined to succeed, driven by fear of failure, the cabinet instilled "a sense of urgency overriding everything," Robert Spillane, Guilford's vice president of research and development, says. An example of that urgency is the way the team developed a substitute for velour -- a velvety cotton fabric that became a hot item in the '70s, despite its steep price of $8 a yard.

Manufacturing might tell marketing what was doable in other companies, but at Guilford, if the project was a priority with Hayes, everybody worked to make it happen. "God help them if they screwed it up in their department when everybody else had done their job," Spillane says.

Despite having to invent a new way to dye the material, the team perfected a synthetic velour in 1978 that "was the basis of six or eight years of profitability on that one product," Fleisher says. "You just never gave up."

After increasing its sales 70% in five years, Guilford had what the company calls its golden year in 1984. It earned $24.3 million on sales of $456.9 million -- almost a 5% margin, stacked up against Burlington Industries' 2%, J.P. Stevens' 1.1% and Springs Industries' 3.8%. That's the year the Atlanta-based management...