Manufacturing: Rise and Fall of the Conglomerates

Hartley Peavey with GE Calma CAD/CAM System, 1984
Symbolizing the pressures to stay competitive, Hartley Peavey opened one of the world’s most advanced research and design centers in 1983.

The conglomerates who had purchased highly profitable instrument manufacturers in the sizzling 1960s, found themselves deeply in debt by the early 1980s. They had failed to recognize the small size of the music industry and paid too high a price. Most thought the conglomerates were ill-suited to manage an industry they knew little about. Their mistakes led to the demise of dozens of instrument manufacturers.

By the end of 1985, the conglomerates had departed. The companies that survived went through painful rebuilding and consolidation to compete in a world market with increasingly high standards. Companies of the 1980s had to be flexible, responsive, innovative and global in scope.

Foreign manufacturers like Kawai, Roland, Yamaha and Samick opened facilities in America, giving U.S. firms even more competition. By 1985, advanced technology was the name of the game as the music industry marched to the beat of microchips and synthesizers.