The Retooling Of Stanley Black & Decker

Jim Loree wants to turn a 175-year-old manufacturer into a company as innovative as any in Silicon Valley

- Amy Feldman

In 2014 Stanley Black & Decker set up engineers in a Towson, Maryland, strip-mall office with instructions to come up with something new in cordless power tools. Three months later, James Loree, chief operating officer and chief-exec-in-waiting, had a look. The Towson engineers demonstrated a clever way to arrange cells in a battery to make the voltage adjustable. Loree asked what they would need to get the battery out the door in a year. The reply: $30 million. “I looked at the CFO and said, ‘Are we good for that?’ and he said, ‘You bet’, and offthey went with their $30 million,” Loree says.

Stanley is an ancient firm, still making tape measures in the rust-belt Connecticut city of New Britain where Frederick Stanley opened a hinge-and-bolt shop in 1843. How does a company survive for 175 years? By throwing money at long shots like that battery. Says Loree, “History is littered with stories about legacy companies that were complacent, inwardly focussed, arrogant.”

Stanley’s variable-voltage battery didn’t reach stores until June 2016, but it looks like a winner. Lithium-ion batteries are getting big enough these days to run not just handheld drills but also standing equipment like table saws. The big tools, though, need a much higher voltage to operate efficiently. The designers in Maryland figured out how to make batteries interchangeable by having the tool tell the battery what kind of juice it wants.

By this trick Stanley gets carpenters addicted not just to its tools but also to its batteries, which retail for up to $199 apiece. They’ll pay extra to be able to build a house without lugging a noisy generator to the job site and tripping over power cords. Stanley is hauling in $300 million a year on its FlexVolt batteries and wants to see a lot more breakthroughs, meaning innovations that will each add $100 million or more to revenue.