CHICAGO (ELCA) -- Augsburg Fortress, the publishing house of the Evangelical Lutheran Church in America (ELCA), terminated 34 employees Nov. 12, said the Rev. Marvin L. Roloff, Augsburg Fortress president and chief executive officer, in a memorandum to employees. The staff reduction is part of a significant reorganization and downsizing of the publisher that will result in new business units and discontinuation of business operations no longer needed, Roloff said.
Employees who lose their jobs were given severance and are eligible for job placement services and insurance continuation. The employee reduction is part of a $3 million cut in expenses, Roloff said.
In addition, as many as 38 employees are eligible to accept a voluntary early retirement program. Those who accept this option will retire by Dec. 31, Roloff said.
"Augsburg Fortress revenues have been in decline over the past 10 years and the company has not responded as well as it should to the needs of our markets," Roloff said. "We have worked hard during the past 18 months soliciting feedback from our customers, significantly updating our technology capabilities, revising products and developing a strategic plan."
Augsburg Fortress, based in Minneapolis, anticipates an operating loss for 1999 and expects an operating loss next year as well, he said. Despite that, the company does not have any debt and has a strong balance sheet, Roloff added.
Plans for reorganization and possible staff reductions were reported to the Augsburg Fortress board of trustees, which met Oct. 21- 23 in Minneapolis.
"We regret having to implement employee reductions, but we are committed to assisting employees to the greatest extent possible," Roloff said. "Fortunately the strong economy will help. While these staff reductions are painful, we are excited about this new strategic direction and the opportunity to rejuvenate our mission in proclaiming the message of Jesus Christ within the church and beyond."
"We will move forward with new opportunities of leadership," he added. "We intend to be the premier Christian publishing house in the United States."
Prior to the staff reduction, Augsburg Fortress employed 240 people at its corporate offices in Minneapolis and 114 people at 16 other locations around the United States, Canada and Puerto Rico.
The restructuring is the result of an extensive study of the company's operations by the Manchester Companies, Inc., a Minneapolis business consulting firm. In April, Augsburg Fortress board of trustees endorsed several suggestions from the Manchester study, including a recommendation the publisher refocus its business system to create a market-driven organization. As a result, Augsburg Fortress will be restructured into four market-focused business groups. They are:
+ An ELCA group, which will develop and market products needed for worship and congregational life in ELCA congregations;
+ An ecumenical group, which will develop and market products needed for worship and congregational life to all other denominations and faith groups;
+ A professional development group, which will develop and market such products as academic resources needed for development of church professionals; and
+ A consumer group, which will develop and market products for adults, teens, children and families used in settings outside of congregations.
In addition, business groups will be formed for Canada and new ventures.
"The board of Augsburg Fortress has approved and fully supports the strategic plan and budget established by President Marv Roloff and the management team," said Richard E. Lodmill, Seattle, board chair. "The changes will position the (publishing) house to more effectively accomplish its mission in responding to the needs of customers in theELCA, = ecumenical partnerships, academia and general consumers. The changes will be difficult but will open significant new opportunities along the way."
A company meeting was planned for Nov. 15. Information will be provided about the new structure, business plans and how employees will be involved in Augsburg Fortress' future direction, Roloff said.
Augsburg Fortress is the third-largest Protestant church-owned publishing house in the United States. It provides education materials, music, books, ecclesiastical arts, electronic worship resources, computer products and other resources for congregations and non-church markets. It also publishes several magazines, including The Lutheran and Lutheran Woman Today.
***Gayle Aldrich, publicist for Augsburg Fortress, provided information
for this report.
For information contact:
John Brooks, Director (773) 380-2958 or NEWS@ELCA.ORG
http://listserv.elca.org/archives/elcanews.html
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About the Evangelical Lutheran Church in America:
The ELCA is one of the largest Christian denominations in the United States, with 2.8 million members in more than 8,500 worshiping communities across the 50 states and in the Caribbean region. Known as the church of "God's work. Our hands.," the ELCA emphasizes the saving grace of God through faith in Jesus Christ, unity among Christians and service in the world. The ELCA's roots are in the writings of the German church reformer Martin Luther.
For information contact:
Candice Hill Buchbinder
Public Relations Manager
Candice.HillBuchbinder@ELCA.org
