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Chris Lantzy's 16-year career ended in a hotel room in Newton, Iowa. The call came as he was road-tripping from Colorado with his five sons, headed to Mom's house in Cleveland for Thanksgiving. His wife was back in Colorado, pregnant with their seventh child and unable to make the trek.

Lantzy could afford a big family, thanks to paychecks from one of Northeast Ohio's most successful companies, Progressive. He had worked his way up from lowly temp to senior IT programmer, earning $75,000 in a good year. He'd moved to Colorado Springs from the company's Mayfield Village headquarters just two years before, and always planned to retire from the insurance giant.

Now it had come to this: laid off at the age of 44, just in time for Christmas.

Lantzy was one of more than 340 people to receive pink slips in November. Facing a plummeting stock price, declining profits, and a losing advertising war, the nation's third-largest auto insurer was faltering. The "reduction in force" was supposed to trim the fat.

But two months after the layoffs became public, the company bought the naming rights to Jacobs Field. It was a savvy marketing move, perhaps, but one that angered both Indians fans and employees, who saw the $50 million advertising buy as an insult.

Suddenly, one of Greater Cleveland's best employers, a beacon of stability with 9,400 jobs, became a target of ridicule and resentment. While Wall Street analysts may not have been overly bothered by the slump, Clevelanders couldn't help but take it to heart. The region doesn't have many Fortune 500 companies left. If Progressive stumbles, where does that leave us?

In 2000, Peter B. Lewis was headed through security at the Auckland, New Zealand airport when drug-sniffing dogs discovered an ounce of pot in his briefcase. The 66-year-old billionaire philanthropist, who had recently had his leg amputated, endured a cavity search and a night in jail. This is the man who built Progressive.

Raised in Cleveland Heights during World War II, Lewis took over his father's company in the '60s and grew it from a small outfit to a national name brand with 27,000 employees nationwide. Around the Mayfield campus, "Peter B." was a deity.

He hired bright young people and gave them the power to make decisions. They were encouraged to question authority and be honest with their customers — a novel approach in the insurance world.

Under his leadership, the company earned a reputation for innovation. In the '50s, it started insuring high-risk drivers when no one else was interested, and those customers helped business explode. Then, in the booming '90s, Progressive became notoriously efficient. Independent insurance agents could send a customer's information to Progressive and get a policy faster than anywhere else.

It was one of the first companies to sell insurance online. It launched 24-hour phone lines, and even took the unusual step of providing customers with quotes from competitors.

Meanwhile, employees were treated royally with on-site gyms and doctors' services. Lewis' ex-wife, Toby, helped build what became one of the most impressive corporate art collections in the world.

New ideas were welcomed, and if you worked hard, it paid off with promotions and prestige.

"[Lewis] treated his employees as assets to the company and as real human beings," says one former employee.

"There was just a camaraderie," adds Lantzy. "You took care of them; they took care of you."

Lewis was so dedicated to the company that he told a reporter his fantasy was "to be carried feet first out of my office." About eight years ago, thanks to circulatory problems that led to partial amputation of his leg, he ceded the spotlight, resigning as CEO. These days, he enjoys his private jet and homes in Beachwood, New York, and Colorado, and spends nearly half the year on a luxury yacht overseas. Renowned for his love of art, women, and weed, he makes a habit of giving the finger to Cleveland's civic establishment, withholding donations from institutions like Case Western Reserve and University Circle if he decides they're poorly run.

He's still the chairman of Progressive's board, but when he departed, he made Glenn Renwick his handpicked CEO. Some employees say nothing has been the same since.

"Until the reorganization was announced, I could've written a commercial for how much I loved Progressive," says one veteran manager.

"Everybody wanted to be there," adds another longtime employee. "Now it's quite the opposite."

When contacted by Scene, most employees were afraid to speak publicly about the company. Some fear they'll be fired. The laid-off still have friends and family on the job. And Progressive, they say, is no longer a place where people are encouraged to speak openly.

In the years after Lewis left, new layers of management appeared. Analysts and MBAs were hired to examine processes and procedures, rather than bring money in the door. "Things quit getting done," one former manager recalls.

Office politics became more important, Lantzy says, causing the company to lose focus. New managers would reorganize things. Six months later, everything would be reshuffled again. It had become something of a Dilbert cartoon — management for management's sake. "It didn't seem like being a loyal, hard worker counted as much anymore, whereas it always had," he says.

Soon, the trademark collegial office culture was replaced by fear. One longtime employee says that if someone complains in his out-of-state office, the bosses will put a newspaper on his desk, opened to the want ads.

"They pretty much rule with an iron fist," he explains. "They want you out, they'll get you out."

A former local manager, who was earning more than $100,000 a year, learned of his impending layoff at a hastily convened meeting in November. Progressive's call-center chief actually read from a script. The manager's position was being eliminated, they told him. There just wasn't a place for him.

He might have mistaken this for a scene from Office Space, if not for the extra security guards outside the door. He grabbed his coat, turned in his key card, and walked out.

The days of Peter B.'s swaggering honesty and fearless innovation were officially over.

Some trace the decline to Progressive's dubious decision, four years ago, to split the company into two brands. Drive would sell policies the traditional way, through agents in neighborhood offices. Progressive Direct would sell via the phone and the internet.

For reasons no one can seem to explain, the company believed the split would help them win favor with independent agents, who hawked the policies of multiple companies. Progressive invested heavily in the idea, wining and dining agents in Vegas, and renting out a racetrack so they could see the Drive car compete, one veteran employee recalls.

The execs didn't seem to realize that diluting their name recognition by splitting into two lesser-known brands was asking for trouble.

The decision didn't sit well with many independent agents. They were already peeved about Progressive's low commissions and worried that its online and phone sales would put them out of business. Trying to get them to sell an unknown brand wasn't going to help.

"Everybody saw that it was ridiculous," one Cleveland manager says.

Yet the split remained in place until last September, when the company folded back under the single Progressive banner. But by that time, agents had already taken to placing their business elsewhere, says Brian Sullivan, editor of the trade newsletter Auto Insurance Report.

Meanwhile, competitors began to target Progressive's greatest strengths. Other companies jumped into online sales and sought high-risk drivers. And Progressive continued to get pummeled in the area that's always been its weakness: marketing.

According to TNS Media Intelligence, nationwide spending on car insurance ads exploded from $600 million in 2003 to $1.6 billion in 2006. GEICO alone spent at least $500 million that year.

Progressive had long believed that customers would automatically recognize its superior service, Sullivan says, though it might not offer the cheapest policies. But that's not a message that sells well in a sound bite. Slogans such as "Think easier; think Progressive" and "Relax. Just drive" weren't the kind of catchphrases you could hum in a carpool.

Nine years ago, the company ran a Super Bowl ad featuring E.T. as a spokesman for safe driving. It was supposed to be part of a larger branding campaign, complete with propaganda in drivers' ed courses and an E.T. Safety Club for kids. But it all had the feel of a public service announcement. When new customers failed to arrive, Lewis fired the ad company.

"They really don't understand advertising and marketing," Sullivan says. "That's what's playing the game right now."

GEICO is just the opposite. With its faintly British gecko mascot and Caveman commercials — so popular they spawned a sitcom — it offers a counterpoint as a friendly, likable company with a healthy sense of humor.

Allstate, meanwhile, portrays itself as a reliable, comforting hand you can depend on during a disaster. Its spokesman, naturally, is the cello-voiced Dennis Haysbert, who played the president on 24.

By comparison, Progressive's ads seem more like software commercials. They are sleek and tech-savvy, but hardly distinguishable from thousands of others. The current slogan, "It's about you. And it's about time," is as bland as its predecessors. Its latest commercial features a nondescript guy in a checkout line. The cashier claims he just saved $350, then touts the company's "concierge claims service" and 24/7 help online.

Within the blizzard of ads that pound consumers daily, it has all the ingredients to be eminently forgettable.

"Progressive has consistently proven that it doesn't know what funny is," Sullivan says. "It's just bad."

Progressive seems to be aware of the problem. It recently moved its brand development division under CEO Renwick's direct supervision. One of its biggest moves was to buy the naming rights to Jacobs Field. The question is whether displaying its logo at Tribe games will be enough to make a difference.

Sullivan says the name game is helpful, because it builds branding and puts Progressive's name on the lips of baseball fans everywhere. But the dizzying pace at which stadiums change names leaves it unclear whether fans remember any field's name.

"This is a spectacular insurance company with a very powerful foundation," Sullivan says. "Four really smart people can fix the advertising. The problem is, they haven't found those four people."

By last fall, Progressive's stock price had fallen to $18.21 — the lowest it had been in four years.

This raises questions about the company's capacity to grow. People clearly aren't buying its stock, and that problem has persisted for months (the price was down to $17.76 in early March).

Last month, Progressive's claims chief of the past nine years, Brian Passell, was "separated" from the company without explanation. Such moves don't inspire confidence. "They're not growing," Sullivan says. "They need to get this figured out."

It's perhaps a sign of how bad things have gotten that corporate officials refused to talk to Scene for this story. There was a time when reporters could reach Lewis directly. Now calls are vetted through a PR team. Answers to Scene's questions were provided via e-mail and attributed to the company's human resources chief, Tricia Griffith.

She admits that having a well-known brand is key to competing with the GEICOs of the world and says that the Jacobs Field deal is designed to make that happen. As for the employees, they're still enjoying the same gyms, yoga classes, health centers, dry cleaning, and profit-sharing perks they always have. Those who were laid off were considered either "redundant" after Drive and Direct merged, or simply not necessary. She says the company's IT department was "overstaffed." In fact, she suggests that the layoffs, many of which affected higher-paid veterans, would help save Progressive from the problems that concern Sullivan.

"These changes allow us to operate more efficiently, which can help us bring competitive prices to more customers and grow our business," Griffith wrote.

But as one manager points out, it's been four months since the layoffs, and "Our stock prices are still not moving." She can't help but blame the people on top.

"Peter would have found some way to stimulate the business," she says. "He would've put Progressive out there in the forefront."

These days, the mood in Mayfield is dark. No one's sure whether more cuts are coming, and managers feel their every move is being examined from above. One says she used to be free to make many of her own decisions. Now, "I could still do that, but only after I get permission to do that."

She won't leave, because she has a son in college and "couldn't touch" the salary she's earning anywhere else. But she's frustrated, knowing that a company full of "some of the brightest people I've ever worked with" is being choked by fear and micromanagement. "I think that the business would be successful again," she says. "It's like you need to unleash those people."

Of course, no one is ready to write Progressive's obituary. Some analysts argue that the company's roaring growth of the '90s couldn't last forever — all rising empires inevitably plateau. "They had a golden age," Sullivan says. "That is rarely sustained for long."

John Ryan, an analyst for Morningstar, points out that the car insurance industry as a whole is suffering through a natural downturn after a boom. He's confident it's a temporary problem, and a well-run company like Progressive will recover in time. "People may be antsy . . . To us, it's nothing new," he says from his office in Chicago.

Adds Sullivan: "They're struggling, but the core of what they do is still excellent."

In the end, it's hard to kill the optimism bred by decades of success. Even Lantzy says he recently applied for another job at Progressive. "I really cared about the company," he says, "and in a funny way, I still do. It's just a big chunk of me."

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