Business essentials Featured

9:36am EDT July 22, 2002

It was the one toy Arnold Miller always wanted when he was young.

"My husband never had a train when he was a little boy," recalls Sydell Miller, who along with her husband, founded Matrix Essentials. "I didn't know that until many years after we were married. So I went out and bought him one of those little, tiny trains that he could have in his office."

Arnold died in 1992, the same year he and Sydell became the first husband and wife team inducted into the National Cosmetology Hall of Fame and were named "Man and Woman of the Year" by the American Beauty Association. In 1994, Miller sold the company to Bristol-Myers Squibb Co. She remained chairman of the board until retiring in 1996.

Arnold's love for trains remains a happy memory for the Miller family, so much so that it sponsors the train ride at the Cleveland Metroparks Zoo.

"Somebody called the other day and said, 'Guess what? I just rode on Arnie's Engine,'" Miller said. "I said, 'Fabulous, he would love that, knowing that all these young children are enjoying his train.'"

Recalling that story brings a smile to Miller's face, as well as a joyful laugh. It's with that same gentle good humor and desire to give back that she established the Arnold and Sydell Miller Family Foundation, which recently announced a $10 million gift to create the Arnold and Sydell Miller Center for Entrepreneurship at Case Western Reserve University's Weatherhead School of Management.

"I have been looking for something to do in his honor," Miller says. "When this came about, it was just so perfect because it was everything he believed in. It matched our needs and our desires and beliefs."

A search committee has begun seeking "the pre-eminent scholar/teacher in the field of entrepreneurship" to fill the new department's chair -- the Arnold and Sydell Miller Professor of Enterprise Development. The Miller Center will be located in the Weatherhead School's new Peter B. Lewis building, which was designed by renowned architect Frank O. Gehry and will be open in 2002.

"Arnold and Sydell Miller exemplify entrepreneurial success," says David Auston, CWRU president. "They stand as important role models for aspiring entrepreneurs. The creation of the Miller Center at an independent research university such as Case Western Reserve is valuable both for the school and the community.

"Students and practicing entrepreneurs will have access to programs not only in management, but also in biomedical science, advanced technology and other fields in which the university is a national leader."

This eagerly awaited program traces its roots deep in the experiences of its generous benefactor. Sydell Miller began her career in the beauty industry long before she and Arnold started manufacturing beauty products.

And that story, Miller proudly explains, entailed a series of learning experiences that, in turn, will become a classroom case history from which others will benefit. Here are some of the lessons she learned in those years.

Seize the moment

"I've always believed that opportunity knocks once," Miller says. "Maybe one of the greatest strengths that Arnie and I both had was the ability to see opportunity and take advantage of those opportunities."

As an example, Miller points to the time when Matrix Essentials opened a distribution facility in Italy. Within one year of its establishment, the company was the third largest in the country. While on a visit to the Italian site, the head of operations explained that while it was doing well, if it were going to remain successful, it needed its own manufacturing facility, more people, advertising and capital investment.

Not seeing the immediate benefits of making such a large cash infusion into the Italian operations, Miller told the operations manager that such an endeavor wasn't possible yet.

"He looked at me and he said, 'The time is now. Maybe in three or four years when you are capable of doing things, the time will be gone,'" Miller recalls. "I said, 'I have got to figure a way, because it's time to take Matrix to a new level.' It needed the infrastructure of a large company."

It was at that moment that Miller made the decision to finish something that had been started before Arnold passed away.

"The year that my husband died, he had started to talk to Bristol-Myers Squibb," she says. "He had always felt that there would be a time in our growth when we needed to develop a partnership with a larger company, preferably pharmaceutical, where we would get the technology for our products. We were unique in the fact that from Day One, we manufactured our own products. We had our own laboratories, our quality department, as well as our manufacturing facility out in Solon. Pharmaceutical company technology was very important to us."

Aiding that was the fact that Matrix experienced major growth in 1993 and 1994.

"When the salons and distributors realized that Matrix was going to survive without my husband, the doors just opened up," Miller says. "We did more right than we did wrong. We had 80 percent growth in '93; we had a 60 percent growth in '94."

Educate everyone involved with your business

Helping others to recognize and seize their own opportunities is the impetus behind the Miller Center.

"We accomplished the building of our company through education," Miller says. "We used education as our tool for growth throughout our industry (for) everyone that came into contact with us -- our employees, our distributors, sales people, hairdressers, salon owners. We built a program for educating.

"In a small sense, a salon owner is an entrepreneur. Their training has always been in the artistic area and they become very good at what they do, so they now open up a salon."

But, Miller says, it take more than energy and expertise in a field to be an entrepreneur.

"There's a lot of things they didn't learn in beauty school on how to run that business," she says. "We started doing courses. We looked at what we could make available for entrepreneurs who are interested in developing ideas and a business. What does it take? What are the downfalls? What are they going to need to do at what levels of their business?

"How do they get the right financing. How do they promote and advertise? How do they do all these things that they may not learn in a basic four-year course in college?"

In other words, all the things the Millers learned on their own.

During the early years, education was on-the-job for the Millers.

"It was constantly, 'We don't want to hit the wall, so we need to keep educating ourselves. We need to keep reaching out for programs. We need to hire people that are more experienced than us in areas where they can surround us with very skilled people where we lack some of these skills.'"

Learn from success

Miller hopes she's able to help others benefit from her experiences.

"Matrix will become a case study because it is a very unique company with a very unique culture," she says. "In a very short length of time, (it) became the leading company in the industry by more than double any other company in the industry. It has a wonderful story to tell."

It's a story, Miller says, that any fledgling entrepreneur can relate to.

"I guess I've come to realize that it's truly a reflection of the American Dream. It is a story of two people that came from a nice background, but certainly not from any wealth," she says. "Nobody thought we could have accomplished this, so nobody paid any attention to Arnold and me. That allowed us to do our thing.

"When people woke up and discovered we were there to stay, it was too late. We were fortunate because had people tried to put pressure on distributors not to take the line, not to distribute the line, it may have been a different story."

But by the time the competition woke up, Matrix was on its way to becoming an industry leader. When Miller sold it to Bristol-Myers Squibb Co. in 1994, it boasted annual revenue in excess of $300 million.

Enjoy the spoils

Business has so many benefits -- often intangible ones -- that it's easy for entrepreneurs to forget to stop and marvel at their accomplishments. Ironically, however, the trappings of success are readily evident and often the major draw for budding entrepreneurs.

But from the successful perch on which Miller sits, she can easily see a few additional rewards.

"It helps give credit to the city," she says.

When she and Arnold started Matrix, it was difficult to find local people in the beauty supply business because there weren't a lot of beauty supply companies in Cleveland. Says Miller, "We would have to recruit people all the time. It was very difficult."

She remembers the days when airline pilots announced that they were about to touch down in the city where the river burns.

"It used to aggravate the heck out of me," she recalls. "Now (it is good) to see us being looked upon as progressive, one that has helped to rebuild its downtown, its waterfront, that has brought culture to our city. So many people didn't even realize how much wonderful culture Cleveland has always had available.

"I look at it as giving back to a city. It's also very important to my children and me."

There are long-term benefits as well, Miller says.

"It keeps perpetuating because as we develop these people, and hopefully they are successful in whatever dreams they have and helping to make them happen, it will only benefit this city."

Miller realizes her gift to CWRU is a hefty one, but says that only underscores the importance of her goal.

"It's a large gift, but I think it will be one of the most important gifts we've ever given because it will touch a lot more people," she says. "It will help give to the whole community. That's difficult to do when you're giving a gift. I think it's a wonderful tribute to my husband and his memory. Arnold was a true entrepreneur and a very charismatic man.

"He loved people and he loved this city. It's a way of honoring him with something that he loved."

Recognize the benefits

Sydell Miller will be the first to tell you how much she has enjoyed her entrepreneurial experiences. It's that love of the thrill of business that she wants to share with other kindred spirits.

"For me, the opportunity is to be able to build an educational program that would utilize some of the techniques that we used that ensured our success in business. It will help people do that and have fun in doing what they're doing at the same time," Miller says. "I'm not sure you can totally change a person to become an entrepreneur. But I do believe that you can take somebody who has some of those qualifications and you can guide them and educate and develop them to become much better at what they do.

"Many of us groped because we don't have the opportunity to know where the next road is going."

Opportunity, she says, must be recognized in order to be seized.

"Those are where I feel opportunities can be opened up -- to help them go a little faster and a little more confidently and maybe not hit all the pitfalls that we hit. Some pitfalls you have to experience. That's part of learning and growing. But you learn quickly when it's a costly mistake.

"Not all of it has to be through touch and learn. Some of it can be through basic education." How to reach: Case Western Reserve University Weatherhead School of Management, (216) 368-2046 or www.weatherhead.cwru.edu

Daniel G. Jacobs (djacobs@sbnnet.com) is senior editor of SBN.