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Hallmark cares enough to send the very best ... jobs to China

How did Kansas City's card maker bank $4.4 billion in revenue last year? Partly by sending hometown jobs to China.



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Every month, Hallmark threw a party in its lobby for anybody whose birthday or anniversary fell during that month. Everyone broke for the day around 4 p.m. to snack on fried chicken wings, samosas, candy, salad and soda. "I hadn't seen anything like it in China," Shuen tells The Pitch. "They were quite nice to their employees."

Shuen's title was graphic art engineer, but his duties were mainly quality control. He paid regular visits to the Chinese factories that Hallmark hired to print its greeting cards, wrapping paper and the gift items sold at Hallmark stores. With Hallmark outsourcing more and more of its work, it was a busy job.

When Shuen left in 2006 to move back to the Bay Area, Hallmark had 300 employees in Hong Kong and was preparing to move into a bigger space in the 70-floor Harbourfront Landmark building to accommodate more. "We were just growing so fast," recalls Shuen, who spoke to The Pitch by phone from San Francisco. "We were adding new people all the time."

According to online job listings, Hallmark continues to hire employees in China, even as it lays off or fires employees in Kansas City. One online ad boasts that Hallmark needs employees "in support of our rapidly growing global procurement activities" in China.

It's unclear how many jobs Hallmark has outsourced. Shuen estimates that Hallmark was contracting with at least three Chinese factories and was looking to expand in China when he left. Hallmark has responded to press inquiries about outsourcing deals — when they've been made public. In June 2007, the company transferred some ribbon-making work overseas from its 50-year-old plant in Lawrence. The plant still makes ribbons for Hallmark, but a portion of the work that used to be done there is now handled by a Chinese factory. When that outsourcing announcement was made, the company also said it would close one of its two factories in Leavenworth and put the other up for sale.

Not all of Hallmark's work has gone overseas. In 2004, the company signed a $230 million, seven-year deal with Dallas-based Affiliated Computer Services Inc. to handle IT work. The switch required 135 employees to move from Hallmark to Affiliated. Hallmark said it would save $50 million by switching the positions to the Dallas firm.

Among the jobs lost this year were five in the "writing studio." Those cuts occurred when the company redefined job titles and created "required specific skill sets" that some of the writers didn't have, O'Dell says. Two of those writers retired, one left the company with severance pay and two took part-time positions, O'Dell says.

Meanwhile, in its Kansas City headquarters, many employees who spoke to The Pitch complained that complicated jobs once handled by longtime employees are now handled by temps who lack training.

One Hallmark temp who spoke with The Pitch says temporary workers are looked down on and, in some cases, cordoned off into wings by themselves. She's working on a special project with a pool of temps who are not permitted to go elsewhere in the building. She says she recently was told not to drink from the water cooler of a nearby department because employees had chipped in to pay for it. "We are treated like second-class citizens," she says. "It's horrible the way they treat us."

Over in China, though, Shuen says Hallmark has been good to its workers. He says the company gave directives to its factories that the workers shouldn't be required to stay for unpaid overtime. "We had to tell them, in America, we only work from nine to five and then we go home," he says.

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