I stopped by Vans’ new, beautiful headquarters building in Costa Mesa last week to see the space and also to talk to President Doug Palladini.
I spoke with Doug about why it was important for Vans to have its first-ever, proper headquarters after 51 years in business, and about how his first year as Vans President has gone.
It was a year filled with extensive travel, including to Germany, Sweden, Italy, UK, Switzerland, France, Hong Kong, China, Japan and India, in addition to key cities in North America.
First, some details about the new building. It’s 182,000 square feet on 14 acres, right next to the 405 Freeway. Most notably, VF bought the building and land for Vans, and the company has room to expand there.
“VF wrote a big check for the whole thing,” Doug said. “We’re 51 years old, and the string of office buildings we have had in this company has been profoundly shitty. …I give VF a lot of credit and I’m incredibly thankful they said, ‘Vans, you guys have earned it.’ “
Most recently, Vans resided in two nondescript office park buildings in Cypress, with the North America team in the back building and the global team in front. There were also a series of offices at different points that were part of a distribution center, and some that were inside factories.
It’s the first time in about 13 years that employees are working together under one roof.
Doug said it was very important for everyone to be in one building to allow the Vans culture to thrive.
“We are a familial company, and it’s hard to be familial if the family is in different houses all over the neighborhood,” he said.
After asking employees what they wanted in a new building, three themes emerged: coffee, gym, Wi-Fi.
Thus Vans now has a barista that makes Stumptown coffee throughout the day, a large, well-equipped gym in addition to yoga and weight training classes, and very powerful Wi-Fi that allows employees to connect on any device anywhere in the building, on the patios, and even in the far reaches of the parking lot.
Doug said Vans culture has a humbleness about it, and there were some questions about whether the company should really have perks like a barista or exercise classes.
“We wanted to show (our employees) that we do deserve it,” he said.
And while Vans did want to invest in some extras like coffee and the gym, it chose not to hire a chef or create a mini Vans town à la Google and Facebook, which offer so many services that in theory, employees never have to leave.
“We are surrounded by an amazing civilization here,” Doug said. “We want people to get out and live their lives outside of the office.”
While there is not a chef preparing food, there is a well-stocked grab-and-go food area where employees who need a quick lunch can swipe badges that they preload with money to easily pay for what they want.
The building itself is square on the outside, with a hollow, open-air middle containing a large patio and a bright red, outdoor staircase, which Vans added.
Vans executives toured lots of company headquarters before deciding on the design they wanted, which was created by David Galullo at Rapt Studio.
They liked the idea of an open floor plan, but tried to mitigate some of the pitfalls like noise.
Strategically placed overhead speakers pipe in a small amount of ambient noise, called pink noise, to reduce some of the din that can arise in an open floor plan.
Vans also decided to emphasize common spaces that can be used by all and de-emphasized offices. Only vice presidents and above have offices in the new building, and most of the offices are on the small side.
Instead, the building is filled with tucked-away seating areas where people can meet, or work by themselves away from their desks.
There’s a large seating area on the ground floor with restaurant-style booths and tables, and the barista making free Stumptown coffee. The space opens onto the central patio, adding to the open-air feel.
And, acknowledging that sometime people need privacy, there are small phone rooms for sensitive calls and “huddle rooms” for small meetings that are better held in private.
Another way they tried to mitigate some of the disruption that can happen with an open floor plan is by being thoughtful about where they put the common spaces.
All the common working spaces are on the inside track of the square building, while people’s cubicles are on the outside part of the square.
When employees are walking from one place to another they use the inside track, which means they aren’t disturbing the people working on the outside track, Doug said. The tracks are far enough away that when people run into each other on the inside tracks, it’s not a huge distraction for people at their desks.
“We tried to mitigate as much of the downside as possible about what we had read about open office spaces,” Doug said.
The President’s Role
Being part of the move to Vans’ first proper headquarters was has been one of the highlights of Doug’s first year as Vans President.
He can’t wait to have former Vans President Kevin Bailey, who launched the headquarters project during his tenure, see the space in a few weeks. Kevin is now President of VF Corp.’s Asia Pacific Region.
Other highlights include Vans becoming the biggest brand at VF Corp. by revenue - $2.3 billion - at the end of calendar 2016.
“VF bought Vans in 2004 as an experiment, and to see it come to this point is pretty amazing,” Doug said.
The other big highlight for Doug has been watching the international growth that Vans has been experiencing.
For example, he remembers the brand’s humble beginnings in China, and now it has 1,000 stores in the country, and employees in the region that have embraced the brand and are bringing it to life. In fact, the Vans Park Series will be held in Shanghai at the end of August.
I asked Doug if he felt the weight of having the company’s entire P&L on his shoulders.
“I don’t ever think about it,” he said straight-faced.
Then he started laughing. “Of course I do - you feel it every day,” he said. “But really, the emphasis we have at Vans is doing the right thing for the brand, and the results will follow.
“I worry much more about living up to the promises we made to ourselves about what we are going to achieve as a brand. I know if we do those things, the dollars and cents will work out.
“In my 14 years working here, that’s been the truth the whole time,” Doug said.
He did say he feels a huge sense of responsibility when it comes to VF, and the impact that Vans has on VF Corp.’s financials.
“We are now such a profound amount of revenue, margin and operating income for VF, that’s where the weight is much more overt,” Doug said.
“We may have started as an experiment, but we aren’t an experiment anymore.”
Editor’s note: VF released earnings Monday, and Vans had a stellar quarter. Read about the results here.