Taylor Guitars, a leading global builder of premium acoustic guitars, has announced its transition to 100% employee ownership through an Employee Stock Ownership Plan. The company say that they have made this move to preserve their innovative culture and position the company for sustainable success well into the future.
Today, we speak to Taylor co-founder and CEO Kurt Listug and find out more about this new direction for the company.
Q: Why was becoming 100% ESOP the way for Taylor Guitars to ensure their independence for the long-term future?
A: Early on, Bob and I learned the value of planning ahead. With any successful first-generation company, especially one with a creative culture, there’s always a question of what happens to its culture and the quality of its products or services after the founders are gone. So, Bob and I have spent the last several years considering what type of ownership structure would put the company and our employees in the best position for future success—in other words, keeping it true to its values and preserving the innovative culture that is so important to us. We felt that an outside owner wouldn’t properly understand or honour the culture that has been so important to our success. In the end, we felt that the best and really only viable option would be transitioning ownership to our employees, who’ve contributed so much to our success and live and breathe our culture. And we wanted to do it while both Bob and I still have many good years left to help guide the company forward.
Q: Part of Taylor Guitars’ decision to become ESOP was to provide a valuable financial benefit to the people who have contributed to the company’s success. Why is this important to you?
A: For starters, to reward the efforts of our employees, whose creativity, commitment to our values, and collaborative spirit have enabled us to grow and succeed beyond what Bob and I ever imagined. Beyond that, we know that people often have limited opportunities to get ahead financially in life. The ESOP gives them real skin in the game, and an opportunity to build a better future for themselves and their families by contributing to the growth and future success of the company. I might add that it was really important for us to include all of our employees, including those who work in our factory in Tecate, Baja California, Mexico, and in Europe and South America. Those plans had to be structured slightly differently due to the laws in those countries, but we found a way to make it work and we’re really happy about that.
Q: What makes the culture at Taylor guitars so innovative?
A: It starts, of course, with having a passion for what we do. We love guitars, and it’s really rewarding to make a product that has inspired so many people around the world to express themselves musically. Also, Bob and I both have problem-solving mentalities, and we believe in continuous improvement whether it comes to making guitars or managing the business operations. When you’re passionate about something, when you feel like you’ve found a purpose, you’re willing to persevere through adversity. In fact, we learned early on the value of innovative thinking as a way to overcome challenges. It’s made us more resilient as a company. Along the way, we’ve attracted talented, like-minded people and championed values like collaboration, respect and having pride of ownership in your work.
Q: Will this decision lead to any changes to management structure, operations policies, or practices for Taylor Guitars?
A: Other than the fact that Bob and I, and Andy Powers, our master guitar designer, no longer own the company, no. There are no changes in our operational leadership. Bob and I will continue in our roles as President and CEO, respectively. Andy will continue to be the wellspring of our guitar design efforts. Over the past 10 years, Bob and I have put together a strong executive and management leadership team, and they will continue on, now with an even greater level of excitement and engagement. It was important for us to maintain continuity for the benefit of dealers, vendors, suppliers, customers and, of course, our new employee-owners.
Q: What are Taylor Guitars’ priorities for 2021?
A: Like other companies, to continue to operate safely during the pandemic, and to continue designing and producing the best possible musical instruments. Demand for our guitars remains high, so we will also be focusing on hiring and increasing our production capacity to fulfill orders.