THE TIMES 100 : The Best Performing Companies in California : THE HUMAN FACTOR : Armor All Products Tops List in Revenue Per Employee
The next time you get the impulse to spruce up that car--especially the tires and dashboard--there’s a good chance you’ll add to the stellar record of Laguna Niguel-based Armor All Products Corp., the firm with the highest revenue per employee of any in the Times’ annual ranking of California public companies on that basis.
Last year, Armor All grossed $1,126,000 for each of its 123 employees, topping the list in all categories (see table on Page 40).
Armor All President Ken Evans said the company keeps revenue per employee high partly by concentrating on marketing and sales. Manufacturing is done by outside vendors.
In addition, Evans said, Armor All is careful to keep its work force lean but avoids layoffs by retraining people if their positions become obsolete. Last year, Armor All did lose three employees, but company sales increased by 9%, Evans said.
“These are knowledge workers, and they do have very important productivity measurements, such as number of orders written and reductions in the number of complaints,” Evans said. “Productivity is a very visible part of our everyday life.”
In other industries, Chevron Corp. topped the list of energy companies at $661,400 per employee, down about $100,000 from the previous year. SCE Corp. led the utilities at $405,100, followed by Pacific Gas & Electric at $366,200.
Foundation Health Corp. far outpaced other health services companies, with $779,500 in revenue per employee, down from $813,900 in 1990 but way ahead of the next highest competitor, Safeguard Health Enterprises, which earned $187,800 for each of its 324 employees.
Leading the aerospace sector was Trimble Navigation Ltd., which showed $171,400 in revenue for each of its 881 employees.
Some economists caution that a simple ratio of revenue to number of employees may not necessarily show whether a company’s workers are productive.
“It would depend very much on what the company produces, what the company does and what the profit margins are of the company,” said Sar Levitan, director of the Center for Social Policy Studies at George Washington University in Washington. “It’s too general a criterion for judging company productivity.”
According to David Lewin, director of the Institute for Industrial Relations at UCLA, attempts to show productivity as a ratio of revenue to number of people employed can be skewed by factors such as a change in the number of employees, in the price of a company’s product or in hidden costs. For example, he said, a company might reduce its employee rolls by laying off workers and then farming out jobs to independent contractors. If revenue remained constant, productivity would seem to soar.
Still, measuring productivity as a ratio of revenue and employment can help a company track its own record over the years. It is also useful for comparing companies in the same industry, Lewin said.
Most Productive Employees
Top companies in each industry ranked by revenue per employee.
Industry/Company: Revenue/Employee ($000s)
Aerospace & Defense Trimble Navigation Ltd: 171.4 Northrop Corp: 158.2 Lockheed Corp: 135.7 1991/90 group avg.: 126.57/111.38
Banking Silicon Valley Bancshares: 437.8 Sumitomo: 307.5 Imperial Bancorp: 280.4 1991/90 group avg.: 236.95/235.91
Computer Products Quantum Corp. 528.6 Adv. Logic Research 426.8 Apple Computer Inc. 382.6 1991/90 group avg.: 253.16/214.10
Computer Services Amplicon Inc *: 1,091.3 Logicon Inc *: 86.2 1991/90 group avg.: 588.75/214.10
Computer Software Software Toolworks Inc *: 597.1 Adobe Systems Inc: 316.8 Electronic Arts Inc *: 315.5 1991/90 group avg.: 220.62/186.90
Consumer Products Armor All Products Corp *: 1,126.9 Lewis Galoob Toys Inc: 572.8 Cisco Systems Inc: 374.3 1991/90 group avg.: 335.81/343.12
Drugs & Pharmaceuticals Allergan Inc: 534.6 Amgen Inc: 398.2 P. Leiner Nutritional Prods * 235.9 1991/90 group avg.: 221.35/152.16
Energy Chevron Corp *: 661.4 Berry Petroleum: 650.3 Atlantic Richfield Co: 615.1 1991/90 group avg.: 581.27/525.85
Financial Services The Foothill Group Inc: 549.2 Transamerica Corp: 455.0 Countrywide Credit *: 178.8 1991/90 group avg.: 394.29/391.81
Food & Beverages Erly Industries Inc *: 298.2 Dreyer’s Grand Ice Cream: 281.9 Bridgford Foods Corp *: 165.7 1991/90 group avg.: 248.61/227.13
Health Services Foundation Health Corp *: 779.5 Safeguard Health Enterprs.: 187.8 FHP International Corp *: 157.0 1991/90 group avg.: 144.49/142.90
Insurance Pacificare Health Sys. *: 691.0 Argonaut Group Inc: 689.7 Broad Inc *: 651.5 1991/90 group avg.: 417.62/503.80
Leasing McGrath Rent Corp: 374.3 PLM International Inc: 322.2 Electro Rent Corp *: 240.2 1991/90 group avg.: 312.21/329.02
Real Estate Grubb & Ellis Co.: 53.7 1991/90 group avg.: 53.73/329.02
Retail The Price Company *: 368.6 Viking Office Prods Inc *: 297.6 SysteMed Inc: 270.5 1991/90 group avg.: 154.30/146.05
Services Centex Telemanagement Inc: 337.9 Adia Services Inc: 330.3 Jacobs Engineering Group * 222.7 1991/90 group avg.: 128.20/120.19
Transportation Services American President Cos.: 480.1 Westair Holding Inc: 170.8 Harper Group Inc: 137.5 1991/90 group avg.: 201.55/171.80
Utilities SCE Corp: 405.1 Pacific Gas & Electric: 366.2 SJW Corp.: 281.5 1991/90 group avg.: 273.87/298.74
