Summary
Could a small, employee-owned company meet its ambitious growth goals without compromising its high-involvement culture? LightWorks Optics, based in Orange County, California, made highly sophisticated optical components for defense aeronautics, space exploration, and commercial applications. Early in its history, LightWorks had set up an employee stock ownership plan, or ESOP, under which employees gradually built up equity in the closely held firm. In 2007, the three founders indicated that they hoped to sell their shares to the ESOP trust in a leveraged buyout in 2012. In order for that to happen, the company needed to improve its revenue and profitability significantly; that, in turn, would require that it bring in more contracts, especially ones requiring high-volume production. But, LightWorks had to pay attention to its core capabilities and what it could, and could not, do effectively. Moreover, the company prided itself on its culture of ownership—one in which all employees had a stake in the business and a voice in its decisions. Could the president, Dan Barber, and his top management team reach a consensus on how to expand production without losing the benefits of a culture of ownership?