Monday, August 20, 2007

TEAM: Letter from Bill Newton

Original Source

Letter from Bill Newton
To Business Friends and Associates,

There is much information circulating about “The Business” and leaders that are navigating their teams. I feel the importance of giving you my understanding and position. I will tell you up front everyone looks at discussion and events through lenses of their own perspective. Therefore I will tell you about my perspective so there is reduced chance for misunderstanding.
What brought me to “The Business” are events and experience I gained from our family farm equipment business, along with our manufacturing companies, and our 24 hour truck stop, and farming operation etc., etc., etc... At least 13 companies Jann and I owned either out right or in partnerships of some sort.
The most compelling event that drove my inquiry of the board was the demise of our farm equipment business. Nov, 1981 Allis Chalmers farm equipment Company convened a regional dealer meeting to lay out its plans to fix the troubled farm equipment business. I was 28 years old and had been managing our equipments business 2 years for my father-in-law. What Allis Chalmers did was change the deal in March of 1982. This materially affected all its dealers. Most of the dealers shut down business. All of the dealers that stayed in business lost a lot of money. Our company over night lost millions in value. Jann and I looked at ways to stay in the game to reduce or overcome the losses. I knew immediately we were in business with a company that I couldn’t trust because they changed the deal. I made the decision to stay in business just long enough to find a way out. My trust that Allis Chalmers would do the right thing for its dealers was gone. Now we operate in a mode of self preservation, and how can I lose less. Jann and I worked tirelessly for 4 years, sacrificing many things to work around the problems that Allis Chalmers unloaded on us. At the closing of our dealership April 1st of 1986 we lost over 3 ½, million dollars, and every asset we had.
Ten months later I see the IBO plan from Jim McAnarney. I told him how Allis Chalmers changed the deal. He told me that I am going to love and appreciate this plan, because it is operated by a board of IBO’s and the vendor can’t change the deal unless we elect. When I heard this, if true, “I’m in”. This board governance issue has been repeated thousands of times by most all leaders. My goal from the beginning of my business was to be on the board to help govern our business. This was my dream. Knowing I’m in for life and my family will operate our business after me was the ultimate inspiring vision I had. As I brought new business owners into business with us, I told them the value of the IBOAI board and what that means to us and them for the accomplishments of the dreams through “The Business”. In the fall of 2005 I got a call from a mentor and friend Jody Victor. He asked me if I would accept an elected position on the IBOAI. I was elated. A major part of my dream was coming together. I am on the Business Operations Committee, and also serve as a hearing panel member for the dispute resolution process. I was just voted to Chair the Proactive Communication Committee to let the board tell its own story. The board felt our perspective is critical to the IBO’s.
While serving on the business operations committee, we discuss what IBO’s need, and what should change or improve. When I attended my 2nd board meeting and saw Quixtars response to our request with little or no good reason (my perspective) I start to get the inkling the board has a more limited ability to govern than what I understood. Most IBO’s have the same understanding that I HAD!
The folks that served a long time on the board knew the board was weak. They never let the IBO’s know how ineffective or powerless the board really is. Please fellow board members don’t get defensive on this matter. Most all IBO’s believe the IBOAI govern the plan or company etc...
As the truth is revealed Board Members may want to resign from the board or at the very least give disclosure to IBO’s how toothless the board is. They can then make an informed choice whether to send the board dues. Knowing that the board is covering up their real abilities to recommend, govern, direct or how ever you want to spin it.
When Quixtar Inc. said they are going to put 60 millions plus dollars into new bonuses we all cheered, then later added material changes to our business model. The changes may include new policies and rules not approved by the IBOAI, new SA4400, this is entrapment by association. When Allis Chalmers changed the deal on its dealers the interest rate was 18%. Allis Chalmers advertised 6.4% financing to the public on equipment purchases. The problem was the dealers were on 100% recourse financially at the low rate of interest. (Dealers were trapped into complying) etc. etc. etc.
The board shouldn’t allow Quixtar to do a joint statement to the field that they are solidly behind Quixtar’s actions to terminate Orrin and Chris. Full and accurate perception to the field should come from the board to correct this cloaking reality. The remaining board members that were submitting to Quixtar's rolling over them possibly are behind this action. There are some very capable men who see things very differently than Quixtar on these issues. Where is their voice to the IBO’s? That is one reason I am sounding off. The new communications team at the IBOAI that Melissa is working with should be in hi gear with the whole story. IBO’s want full disclosure of what happened and who is actually behind this action and who isn’t. I will be looking forward to that communication.
When I called into Quixtar customer support and was told they are changing the name to Amway I called several leaders for their take on it. I was told that the founder’s council was behind this action. My first call was to Founders Council Jim Dornan. He told me he was not in favor at all the Amway business change. Dornan’s son, a new emerald, said this would devastate his business making it almost impossible to build. Jim is one of the best business builders in the world. Why would he and his son talk this way about the change in business unless it’s true?
Here is Orrins logical look at all the changes that Quixtar is forcing implementation on. When you try to fix a machine or company to get a better result you adjust 1 knob or 1 thing at a time. Then you track results. When you change 2 things you can’t determine an outcome.
We are being forced to adjust about 10 things jammed at us by Quixtar. We go into a living room tonight and say here’s the result you will get. That is not a respectable representation.
Many leaders had dialog about changing vendors from Quixtar to a more accommodating environment or vendor. Some discussions went from “yes we should”, to “How can that happen”, to, we are trapped because of rules”, to my talk with Jody Victor. My understanding is Jody personally hates this. If you throw Amway into this environment, it puts undue hardship on them. Every leader has discussed a strategy to boot Quixtar and replace them with something we can work better with.
When my son, Cody, heard the news about Amway the following dialog took place. “So… Dad, the board won’t be behind that! I’m not doing Amway!” No one in my group signed up for Amway!?*!” Cody believes the board will stop this stupid thing from happening. The board meeting is about a week away. After the Board meeting, Cody read on blog that 100% of the Board stood against the Amway action, but Quixtar was going ahead with it anyway. It was at that time Cody saw that his dad had been working, living, and educating all of us differently than what was real. He was duped. Cody remembers Allis Chalmers. He told me he won’t spend anymore of his life dealing with Quixtar, knowing they can go unchecked and make material changes without the Boards’ governance.
Randy Haugen said when you change our name to the New Amway it will have similar effect to building a ship and calling it the New Titanic!
My word and beliefs are very important to me. The reason I resigned from the IBOAI is the perception that most IBO’s have of its function and effectiveness are not the same. This in no way means the men and women serving are not giving their best. As smart and great quality leaders they are; they were totally ineffective at fixing a problem that most all IBO’s felt was in their jurisdiction to administer and solve. Knowing of the Boards’ inability on this issue indicates they are neutered on other vital issues of our business. Don’t get the wrong idea about the board and its great participants. This is about a controlling corporation. Since I have thrown 20 years of my life into my business to figure this out now, I feel compelled to enlighten those that care as I do, sooner than later.
Now for Quixtar/Amway and its actions: There has been over 15 million IBO’s registered since they started. Add spouses and you have approximately 25-30 million people. Now add 3-4 people that are very close to each IBO – the total people that have had the opportunity to buy Quixtar and Amway products could be 70-100 million people, conservatively. Why are there only about 300,000-400,000 people buying products today? Stand by for the problem and solutions.
When a new IBO registers and looks in catalogs, or goes online and takes their first glance at products – a perplexed look comes to them. The pricing on most items is higher than what they have been paying prior to becoming an IBO. Their thoughts generally take them down the path of, “now I know how the upline in the pyramid make so much money”. They get a feeling like they are the one paying the price for all those bonuses. It really puts the new IBO and their sponsor in an uncomfortable situation. One, being “you’re taking advantage of me, or why didn’t you tell me these aren’t good deals”. The new IBO is emotionally leaving the business because of high pricing within 30 seconds. The upline hasn’t had an opportunity to get them to a training conference, nor have they purchased any business support materials yet. The new IBO was probably lent materials to help with training. This period is what I call the churn. Good builders build depth in teams, and do it fast. The goal is to re-engage hope for the new IBO after he sees high prices. “Maybe if I get enough bonuses, the prices will be tolerable, therefore I will suffer with my sponsor awhile if depth is built in my group”. If very little happens from their upline team in the early stages, the new IBO will exit. And exit they do with an opinion about Quixtar/Amway product prices being high.
I and most leaders have discussed this process and real problem of high prices with the executives of Quixtar and Amway over many years. This is the main reason for Quixtar and Amway’s poor reputation. Quixtar is in denial about this reputation issue because of high prices. Instead, Quixtar barks at IBO’s about their behavior and sets up encumbering rules of which we don’t control, but have to abide by, thus, making the effort index too great for most men and women. I’m watching The Team growing in this challenging environment, while most other groups are backing up. Envious leaders explain to their own groups that The Team is just better trainers, or have a better system, or something. If the leaders can’t handle the truth they generally will throw darts at what The Team is doing and make them look like they are doing something wrong. I called Jim Payne, Managing Director of Quixtar, about mid-July 2007. I asked him specifically if he was aware of problems with The Team. He said all teams have issues at some time or another. He said Orrin Woodward has always been good to work with and he anticipated that anything that should come in the future could easily be worked through. I just saw blogs from Corporation Communication that says it totally different. I don’t think Jim Payne, Managing Director, was lying to me. I do believe some out-of-control small-minded employee with an axe to grind wrote the crap about those fine principled men that stand on what is right.
Where do we go from here…
I had to voice my opinion in a strong way. I do not agree with Quixtars encumbering and overbearing changes they are making in the business. They are:
1. Name change to Amway
2. New SA440 that tells a new IBO starting Sept 1st that Quixtar
will turn into Amway in 18 months. Gives lip service to
selling. Just lipstick on a pig in there.
3. The new money is a 2 year program and is not in our plan. It
is doled out at Quixtars whims.
Most people can’t come up to speed in time for the big bonuses. (More lipstick)
4. Quixtar cancelled their contract with the IBOAI board
Effective November then they want to go month to month. This action came after the board sent them a letter that states we are 100% not in agreement on the Amway business change. So if the board makes Quixtar feel good they may continue month to month.
5. Quixtar has not produced the 20 products the board asked
for a year and a half ago.
6. High priced products. Many leaders have requested
reduction in prices since 1995. We got a grin and a head
shake. (more lipstick)
7. The company wants to change the business model that we
signed up for. The board’s opinion didn’t change their mind
or plans.
I counted another 5 things that are in the works that because of a contract I made when I went on the board prohibits divulgence. The above information is already out on memos and blogs.
Since I recognize the perception from Ibo’s is mostly that the board governs our business, I feel its necessary for me to tell the truth and not be a party to a board that I thought governed, but doesn’t.
This is why I resigned from the board that I so much wanted to participate in.
You will get accurate information from
I love and appreciate all business owners we affiliate with. I will continue to support your businesses. Stay hunkered down and do what we all do best. We build communities.
Since 95% of us can’t sell the Quixtar products for a retail profit stay hunkered down during these times and do what we do best. We build communities. A better commerce environment will come.
All of you in business today looked at the plan to move down the tracks in one direction, then woke up and found that Quixtar changed the tracks and we are now headed a different direction than what we signed up for. It's not right that we should have to stay in a different business that most of the leaders and board don’t agree with. Quixtar should let free enterprise have its way. If you want to pursue a better option in business for your family at this time the 2 year rule should be nixed for all the afore mentioned reasons. Quixtar should negotiate a settlement with who ever wants to pursue a different business and take their friends and family with them with out any action against them. Quixtar did not build your company nor did it know your friends that you put in business with you.

Fighting for what I believe is right!
Bill Newton

Since composing this letter I received a letter from Quixtar saying they will not accept my resignation from last week but they are terminating me.

Blessings Bill


Lee and Sandy said...

Thanks for setting the record straight Bill. And thanks for fighting for our business.

Dave said...

Thank you Bill for your dedication to what's right. Your character and integrity appear to be on the same page as the TEAM leaders and am sure they would welcome you in with open arms.

Collateral said...

I appreciate your integrity Bill. There are many more of me standing behind The TEAM.

Brad Obert

Chris and Helen said...

Bill and Jann,

Watching this all play out reminds of David and Golith. 1st Samual 17:29 it says "... is there not a cause?" David said that statement to his Brothers that were telling thim that he was too small to take on Golith, he didn't waiver he knew there was a cause and that was enough for him to fight the good fight. I am proud to know that you are today's David, fighting for a cause. How does one put a price tag on it to know that you have risked everything so that others can live the Dream, you can't there is no price tag on that All we can do is say Thank You.

ed said...

The last few weeks have been stressful for many of us. More so for some than others. Many rumors, weblogs, and emails are surfacing regarding the latest corporate and IBO developments. And, for the record, this is out of character for me to post a message on a blog--I've never done it before.

As history unfolds itself and we look back on this, it will become more and more apparent what mistakes have been made. In the mean time, how do we proceed?

I don't know where this quote came from but it goes like this. "Make your decision for what is right, not expedient, and wash your mind of all compromise." In my 51 years on this planet I've met 2 people who, I feel, truly abide by this creed-- my dad and Bill Newton. You may have other experiences but that has been my experience.

Many of you understand the concept Michael Dell has about having a successful Internet business with regard to the 3 C's, content, commerce and community. My perception is that Quixtar has been serving to provide us (the community) with content and commerce. They provide the content, we provide community which results in commerce. Content is built with money--community is built through leadership. Commerce can be influenced by either. If the content of the website (or any other product and/or service outlet) reflects prices below market average on the majority of its products and services, an increase in commerce will occur without any leadership. The community of commerce will develop much like any other community of commerce develops that is motivated by low prices. That community will follow low prices--period. No leadership is necessary. If, on the other hand, the content of the website reflects competitive, or worse, higher than market average pricing structure, then leadership is necessary to develop the community. In our particular case, leadership is essential to help keep IBO's focused on income potential and asset (business) building activities and how it will benefit them in their pursuit of their dreams. Otherwise the tendency is to be a typical consumer in their decision making process and balance cost and convenience--with little regard to long term income potential or business building activities, i.e. leadership and community development.

History is replete with examples of hostile take overs from wars to corporate mergers. The dominating force will remove the community leaders (usually in a public manner) and through acts of intimidation, rule what's left of the community. Are the owners of the "content" (the website the owners built and own) attempting a hostile take over of the "community" (the team of people following the leaders) by publicly executing the community leaders? Does this act strike fear in the hearts of the community? Are the corporate urgent and immediate response required emails of "sign or be terminated" acts of intimidation to rule what's left of the community? You decide.
It appears to me that Quixtar has many of us entrapped through non-compete and non solicitation clauses on a train--and they have shifted the track on us. Many of our representatives on the Board opposed this shift and either resigned or were terminated--you decide. My interpretation of the law suit is that many of us want to get of the train and continue down the track we were headed. Quixtar wants to lock the doors and not let us off. In my opinion it appears that the people at Quixtar are the ones attempting to pilfer communities the leaders have developed.
How would you feel if you spent several years of your life developing a community of loyal IBO's only to have your income from that community taken away? What happens to that income? I'm not sure. What do you think happens to it? Over the years there have been a lot of people that have had their businesses taken away by the corporation. I've never been notified of extra money available to us that has been seized by the corporation for arbitrary rules and ethics violations by the leaders. If it comes back to the community I am unaware of it.

What's happening to these gentlemen reminds me of the scene in the original move, "Walking Tall." Forgive me if this isn't accurate, by my memory of it is like this--Bufford Pusser leaps from the witness stand, rips his shirt off and faces the jury and says, "If you will let them do this to me, then they will do the same d__n thing to you!"

"Make your decision for what is right, not expedient, and wash your mind of all compromise."

Ed & Donna

Victora916 said...

Bill & Janice,
I know you probably won't reply, but her goes... I've heard your talks through Inet srvcs. Although I have not met you, I know you throught the cd's. What can you say about Q? They changed the plan, and our leader Chuck & Co. wouldn't stand for it. If only I could have been a fly on the wall with all of you there. As Orrin says, "it would make a pilgrim cry". Pilgrim's would have been crying! To offer freedom and change course is not what I plan on showing people. What do I show them? A plan to achieve what? Chuck always wanted the same plan for us to achieve our dream. Chuck's posting outlined a lot of what frustated him. I won't go into detail because you already know. But what I will say is that the community is the key and the TEAM know the way and we respect you very much. BTW... We can just walk... How can they find out or sue a little IBO who has nothing?

RussRamey6 said...

I have been involved with A/Q since before new years Day 1979 and I am through with them regardless. No corporation has ever had our benefit in mind.
I know Don and Randy as men of integrity and if they resigned-I resign. Go TEAM and damn the torpedoes...just resign and let us take OUR people out of this abomination.

Ed Manley said...

Quixtar was never meant to do the things that are happening at this moment. Rich Devos and Jay VanAndel never saw this coming. But a pay plan based upon 1950 economics can play havoc in todays economy.Everyone in Amway and quixtar works very hard to instill beliefs and spirit in each and every new distributor. I myself left Amway in 1992. At that time, I was blackballed because I had the same questions that the field is questioning now. IT TAKES A REAL LEADER to stand up to the company as all of your leaders are doing now.
But know this, Put all that is happening in the LORD'S Hands and it will work out for the best for all Distributors. New as well as old. I am in direct contact with Market America now. Since 1995 I have been a distributor. I have seen many of you that have been unhappy with what your company has been doing to the field. I TRULY UNDERSTAND. JR RIDINGER DID too. He was a double Diamond in Amway many years ago and saw the problems happening then. Today after 15 years He has created something that even the average individual can make money at. PLEASE DO NOT DISCARD THIS BLOG!
I am here to offer anyone the opportunity to come to our corporate head quarters and meet the corporate staff, see for your self that there are legitamate and secure ways to even increase your overall income with less emphasis on just recruiting. I can be reached at HealthTrends at GoNowMail com My Name is Ed Manley
My God Bless You all In whatever Happens!!

Anonymous said...

There was a time when
I was amazed at the quality of the people I've found IBOs to be.I am now fortunate to know many ,sadly I am not fortunate enough to know Bill Newton.However I am extremely proud of Bill . I have always stated that without strong ethics, morals and honesty one cannot succeed longterm in a business such as ours. Bill Newton, you sir, made me very proud in many many ways , thank you and I look forword to being associated with men and women like you for many more years to come.

thank you very much, DAD