Smart growth Featured

8:00pm EDT June 28, 2006
Sometimes the best way to grow a company is to spin off a successful business unit into its own entity. That’s what Andre Temnorod did in the first quarter of 2006, when his Cleveland-based wholesale VoIP telephony provider Broadvox spun off InfoTelis, its retail business unit.

“The separation was needed because, in some cases, we were competing with our own customers, and it’s not a good business practice,” says Temnorod, Broadvox’s chairman and CEO.

Broadvox posted $16.2 million in 2005 revenue, and Temnorod expects the 60-employee company to nearly double that this year.

Smart Business spoke with Temnorod about how he adds employees and plans for growth.

What do you look for in the people you hire?
I pay attention to continuity. If somebody has been jumping from position to position every six months to a year, unless there are some very specific qualities that I’m looking for and that person has those qualities, I won’t be calling that person for an interview.

When you see somebody who’s been on the job 10 or 15 years and you see them starting from a low position and making their way up within the same organization, it tells you about commitment. I look for people who can grow in my organization as well.

Honesty. If somebody lists some professional qualifications in their resume, and during the interview, it comes up that they don’t know what the hell they were talking about, that’s a red flag immediately.

How can companies deliver what their customers want?
Everything starts with product development. When you develop a product, you’ve got to make sure you deliver a product that has demand. You don’t develop the product in a vacuum.

You need to know exactly what the market wants. One of the good things to do is industry-specific focus groups. We do it internally.

You’ve got to cut down time-to-market cycles because if you’re slow, by the time you’re out to market with a product, your competitors can beat you to the punch. It gives you a competitive edge — you’re the only game in town.

How do you determine your growth strategy?
You’ve got to invest money into the market and nurture it in the beginning. We know how much money we have right now and how much we can raise in our additional offering; that determines how many markets we’ll open.

What role do customers play in your company’s growth?
You’ve got to be customer-oriented. You’ve got to deliver what the customer expects, and sometimes you’ve got to overdeliver a little bit. You’ve got to keep bringing the customer back.

In wholesale, you’ve got to make sure the customer keeps buying from you. That’s another reason why we split up the company: different customer orientation.

The customer has a lot of different choices out there. We’re covering a lot of bases at the same time, so we need to make sure that all of our services are functioning properly and that the customer’s satisfied and receives a very good customer experience.

How do you ensure that?
I’m consistently monitoring the performance of our customer service and sales departments. I go through a lot of reports and meet with salespeople and customer service people to discuss our marketplace and give them my feedback. I don’t have a very big organization here, so I try to stay very hands-on.

What areas does a business owner need to look at when considering growth?
You’ve got to make sure you have enough money for the growth. In a lot of cases, when a company’s growing rapidly, they’re losing money. They need to make sure that they have enough money to sustain that growth so they don’t run out of money in the midst of that.

Before you plan rapid growth, make sure that you can sustain rapid growth. A lot of companies are getting killed by growing too fast. Make sure that all the departments are ready and well-staffed so you don’t have holes in your operations, or it will cause a lot of growing pains.

Businesses don’t build themselves; people build businesses. You have to be surrounded by good people who are willing to bet their future on this company.

Make sure that the core of your company is good people and that they’re happy in your company, well-compensated and see the future.

HOW TO REACH: Broadvox, (216) 373-4600 or www.broadvox.net