Tension – The Beginnings
By the age of 24, William J Berkowitz was already an accomplished businessperson and entrepreneur. Little did he know that his decision to sell advertising novelties would ultimately shape the future of the envelope industry and Tension Corporation.
The young William J Berkowitz grew up in Pennsylvania, finishing his public school education in Pittsburgh. Upon graduation, he went into his family’s clothing business which had been established years earlier by his father, a German immigrant.
He soon broke out on his own selling advertising novelties such as pens, pencils and paperweights. This business was so successful he was able to invest, bit by bit, in real estate. However one day he made a “serious mistake,” according to his grandson, Bert Berkley. “He signed a promissory note for a friend. The friend went bankrupt, and because we like to say that “integrity” was my grandfather’s middle name, he sold his real estate to cover the debt.” Later, as the family lore goes, his real estate plots would be developed into what is now known as the Golden Triangle of downtown Pittsburgh, Pennsylvania.
Shortly after selling his properties, William moved to Kansas City, Missouri, where several of his brothers already lived. He worked at the law firm of Lathrop, Smith & Marrow in 1884, studied at night, and clerked over the weekends. William found himself increasingly interested in business, so he decided to leave the law profession and join his younger brother, Maurice.
On March 17, 1886, William and his brother founded a new business, Berkowitz & Company Printers. William J Berkowitz was adept at recognizing what was needed in the marketplace, and became the primary business solicitor. He was often described as being an excellent judge of human nature and found it easy to deliver his customers’ requests. He started selling envelopes and printing, and, again, he found himself selling advertising novelties and items that were personalized with a company name or logo printed on them, as that was the business he knew in Pittsburgh.
The Berkowitz brothers were astute businesspeople. Seeing a void in the marketplace, they began to manufacture envelopes in 1890, which immediately proved profitable. Although other printers existed in Kansas City, Berkowitz & Company appeared to be the only one making envelopes. Their letterhead stated: “Berkowitz & Co. Printers and importers and manufacturer of Advertising Novelties for every business and Manufacturer of Envelopes of every grade and color,” although these envelopes of “every grade and color” were all one size and produced by hand.
In 1894, the company brought the first envelope-folding machine as far west as Kansas City. And in about 1896, the envelope business had grown so rapidly that Berkowitz & Company gradually withdrew from the general printing business to concentrate on the production of envelopes. By 1901, the company focused solely on manufacturing envelopes and changed its name to Berkowitz Envelope Company.
The company was expanding, and William J Berkowitz’s sons, E.B. and Walter, joined the business as young teenagers.
E.B. Berkowitz would eventually go on to lead the business showing expertise in management as well as in manufacturing. Initially E.B. was in sales, yet had a natural proclivity toward the manufacturing side of business and was described as a mechanical genius. Eventually he began to focus on machine designs and processes to improve the production of envelopes. E.B. was awarded Tension’ first patent for a shirt-packaging envelope made on custom-designed equipment, which was issued in 1909.
Walter entered the company as a salesperson in 1906 at the age of 14, working in the morning and going to school in the afternoon. Walter was a natural salesperson and eventually was in charge of sales and was secretary/treasurer of the company.
Influence on the Envelope Industry
The Berkowitz, now Berkley, family has long been dedicated to the envelope industry and this continues today. From its earliest involvement in the industry, Tension’s philosophy is that the envelope is more than a carrier of paper. It creates a positive brand image, carries an important message, helps sell a product or service, and can facilitate bill payment.
In 1911, William J Berkowitz was one of three founding members of the American Envelope Association, the predecessor of the Envelope Manufacturers Association (EMA), which was established to share knowledge and advocate for the envelope manufacturing industry. His descendants, Bert and Bill Berkley, third and fourth generation Tension Chief Executive Officers respectively, continued this commitment to the EMA.
Bert was chairman of the EMA and was also a founder of the Global Envelope Alliance formed to preserve the value and volume of mail worldwide. Bill, Bert’s son, stands as the longest serving chairman of the EMA, holding the position for three years from 2011 to 2014. As Tension’s current president and CEO and the chair of the EMA public policy committee, Bill continues to advocate for the industry through legislative efforts that help the industry thrive and meet the needs of American businesses and consumers.
During World War I, the U.S. Printing Office manufactured and sold envelopes to the U.S. Postal Department, which then resold them in every post office in the country. Because the nation was at war, the U.S. government could buy paper and other raw materials at a lower price than envelope manufacturers. William J Berkowitz recognized the strain this put on the industry, and in 1916, at his own expense, went to Washington, D.C. to talk to the postmaster general and the head of the U.S. Printing Office. He explained that if the postal service was to grow, envelope manufacturers, printers, and others interested in the mail should be promoting mail, something the postal department was not doing. He was successful in his efforts, and, as a result, William J Berkowitz is often credited with saving the envelope business and helping give rise to the direct mail industry.
It was also during this time that Tension saw some changes to its management. In 1914, William J Berkowitz became sole owner of Berkowitz Envelope Company. William’s son, E.B., was appointed Vice President and General Manager, and Walter was appointed Secretary and Treasurer. Later, in 1920, William passed away and E.B. was named President of the company.
In 1921, Walter Berkowitz visited Germany on vacation where a chance encounter would change the face of North American envelope manufacturing. He learned of a new high-speed envelope-folding machine produced by Winkler and Dunnebier (W&D) that could fold a range of sizes, as opposed to a plunger machine, which was much slower and manufactured only one size. Walter arranged a visit to W&D and was so struck by what he saw that he telegraphed his brother, E.B., who traveled to Europe by ship to evaluate the machine. The brothers were able to envision the W&D machine’s impact on the industry and negotiated to have exclusive rights to sell W&D machines in the U.S., Canada and Mexico. This created even more opportunities for E.B. to develop and patent machines and envelopes. That spirit of innovation has continued and to date Tension has received more patents than all other U.S. envelope manufacturers combined.
Consultative Selling Approach
Consultative selling has long been a hallmark of Tension and its sales associates. It is driven by a simple philosophy - by working together, Tension and its customers can achieve greater results by focusing on solving problems and fulfilling customer needs.
An early example was the establishment in 1933 of an in-house Creative Design Department. E.B. believed that a strong graphics arts department, with its in-depth understanding of the equipment, printing process, and printing specifications, would be able to work with the customer and develop the best graphics for the envelope. The department, now named the Tension Design Group, continues today and has created thousands of original creative designs.
How Tension Got its Name
The company purchased the New York-based Tension Envelope Company in 1937. The original Tension Envelope Corporation patented the “Tension Tie,” the now iconic string and button design, which held the contents under “tension.” In 1943, all of the company’s businesses were consolidated under the more recognizable name of “Tension Envelope Corporation.” Coincidently, in 1941, the family changed their name from Berkowitz to Berkley.
Second Half of the Century
The second half of the 20th century was a time of growth, expansion and commitment to Tension’s employees and the envelope industry. In fact, Tension had a policy that any employee who served in the military could have their same position back when they returned from service, and many employees took advantage of this policy.
The early 1960s witnessed a transition of leadership at Tension. Bert Berkley, son of E.B. and grandson of William J Berkowitz, was named President and CEO of the Tension Corporation in 1962. Dick Berkley, who would become mayor of Kansas City in the 1980s, was elected Assistant Treasurer and Assistant Secretary of the board. Walter Hiersteiner, who joined the company in 1951, worked closely with Bert Berkley as Executive Vice President.
Tension grew throughout Bert’s tenure by steadily adding more plants and developing new and improved products and processes. It was under his leadership that Tension expanded to the West Coast, making Tension one of the few envelope manufacturers with nationwide coverage. “We continued to do things that were different,” Bert Berkley said. “We were awarded patents, made the first photo envelopes, an example of one of the many patents issued to Tension. Numerous designs are still in use today.”
When Bert turned 65 in 1988, Bill became President and CEO and was the fourth generation of the Berkley family to lead the business. By the time Bill took over, he had worked full-time for the company for seven years, learning all aspects of the business.
Under Bill’s leadership, Tension continued to grow, both organically as it increased the size of its customer base and by additional sales to existing customers. It also opened new plants, expanded its presence and made strategic acquisitions.
There was growth across the globe as well, as Tension established an international presence in Australia in 1995, then in Taiwan and China shortly after. If you look closely at Tension’s logo, you see that it features a red ball with the letter ‘T’ positioned to the right. “The ball represents the globe and reflects our global presence. The ‘Tension T’ propels us forward, even as it respects and honors our past,” Bill Berkley said.
Into the 21st Century
With its rich history of adapting to the changing needs of customers, Tension expanded its business into the packaging and automation market in the early 2000s. For years, Tension had been creating envelopes for the growing internet retail business. Drawing on its roots as an early adopter and influencer in the envelope machinery industry, as well as its engineering center of excellence, Tension soon began to develop a broad array of machines which package and sort customer orders. “It was the infancy of online commerce, but we had always worked with a number of mail-order companies,” Bill explains. It was a natural extension of Tension’s business of supplying envelope products to provide the automated machinery for Tension’s customers who were packaging orders for delivery – as well as the consumables that go through the equipment.
The process of automating the fulfillment process applied to pharmaceuticals as well, and Tension began selling equipment to pharmacies. The acquisition of Maverick Enterprises in 2011 gave Tension the capability to design and market its own automated fulfillment equipment and systems.
Today, Tension’s Packaging & Automation division designs, engineers and integrates automation solutions for order fulfillment centers and central fill, mail order and specialty pharmacies. In addition, the company offers software, packaging materials, service and support.
The company, after seeing a need for print-on-demand services for its customers, later created Tension Direct, an on-demand web-based printing solution that helps companies keep marketing materials up to date and also services businesses that purchase small quantities of printed goods,. Tension continues to diversify and extend its products ‘beyond the envelope,’ and now also offers business cards, presentation folders, checks and financial forms, and direct mail inserts and letters.
Tension has integrated Lean Sigma principles throughout the company. Lean Sigma is a systematic approach to cost control, quality, and repeatable processes, using methodologies that engage all associates of Tension. It is a bottom-up way of solving problems that empowers every associate to improve the business. Ultimately, as a Lean company, Tension can respond to market changes quickly and effectively, and provide greater value to customers.
In 2011, Tension rebranded from Tension Envelope Corporation to Tension Corporation, reflecting its expanding presence in packaging and automation, beyond the envelope products, as well as its increasing footprint in international operations. Today, Tension’s three divisions are Envelope, Packaging & Automation, and International.
Tension: Making Its Mark on the Greener Side
Sustainability and respect for the environment have long been an integral part of Tension’s approach to business and can be found in Tension’s Vision, Mission and Values statement. Recognizing the importance of sustainability to customers, Tension has always integrated “green” products into its product lineup. Tension was a pioneer in developing the two-way envelope, having patented one of the earliest designs in 1938.
In addition to supporting customer’s green initiatives through two-way envelopes, Tension offers other environmentally-friendly options that can reduce customers’ environmental impact while promoting their brand as an environmental steward. Products and services such as certified and recycled papers, wind credits and soy-based inks are a few examples.
Tension’s commitment to sustainability starts from inside the company walls as the company looks for opportunities to reduce its environmental footprint through sustainable processes and practices. As a result, Tension factories reuse and recycle virtually all of the materials used in manufacturing and integrate sound waste reduction activities into all its processes. Continuous improvement through Lean Sigma has helped enhance these initiatives.
An Eye on the Future
As of 2016, Tension is the second largest envelope manufacturer in the U.S. with seven manufacturing locations and sales operations throughout the country and facilities overseas as well. “Our business is built around adapting to customer needs and providing cost-effective solutions,” President and CEO Bill Berkley said. “And it is all made possible by the dedicated associates of Tension Corporation.”
As the envelope, order fulfillment packaging equipment and pharmacy automation industries continue to grow and evolve, Tension remains at the forefront, leading the way with customer-centered innovations and quality products and services.
“The mail continues to play a critical role in the lives of Americans. Not only does it serve the individuals who still want to receive hard copy documents, but mail also helps connect customers to a company’s digital presence. The integration of hard copy and digital content gets the best result in the mail. As we look toward the future, Tension continues to create new products and advocate for the real value mail brings to businesses and consumers,” Bill Berkley said.