Ray Marano

Monday, 22 July 2002 09:36

In your space

Walk into the conference room at Bulldog Office Products Inc., and you'll find the mailroom facilities line one wall.

That's not a permanent location, but it will have to do while the company completes the last phase of its headquarters expansion.

Bulldog Office Products has many of the earmarks of a company that's growing from a small family business to a middle-market company. It has established operations in Cleveland and Columbus and has a calculated plan to move into other metropolitan markets. It instituted a health plan for its employees a few years ago, and is looking at developing a retirement savings program, as well as an employee manual.

But perhaps the most obvious sign that Bulldog Office Products is growing is the need for expansion of its distribution facility in Robinson Township. Following a reconfiguration in the mid 1990s that eased its space shortage, the company's owners decided to nearly double its warehouse, office and showroom space.

"We've been busting out of our warehouse for a long time," says Frank Fera, president and son of the company's founder. With the completion of its expansion, the facilities will more than double in size, from 15,000 square feet to 34,000 square feet.

Founded in 1968 by Fera's father and run by Fera and his four siblings, as well as his mother and some of his siblings' spouses, the company continues to grow in a market that has become increasingly saturated by big box retailers like Office Max, Office Depot and Staples. Price competition is stiff for office supplies, so the company relies on its ability to provide a high level of service and the sale of more profitable lines like office furniture to beef up its margins.

Its warehouse facility has been pushed by expansions of its operations to Cleveland and Columbus, moves that are expected to help push sales to the $14 million mark this year. With a plan to reach $50 million in sales within five years, the company's managing of its warehousing and distribution will be key to its success.

Pushing the envelope

About five years ago, the company's growing pains were becoming unbearable. It called in Lawrence Zima, a consultant who helps businesses upgrade their warehouse and distribution facilities.

Zima concluded that what Bulldog Office Products didn't need more space, it needed space that was used more efficiently. He showed the company how, with a new floor plan and more efficient equipment like racks, shelving and forklifts, the warehouse operations could be expanded without pushing out the walls.

"That saved us a ton of money," says Fera.

By redesigning the warehouse, Zima increased its capacity without expanding the building.

Ultimately, Bulldog Office Products found the seams bursting as operations in its new markets began to tax the warehouse's limits. With more space, it saw opportunities to purchase larger quantities from its wholesalers at more attractive prices -- and realized that showroom space would be an asset in selling furniture and design services to clients and architects.

Again, it called in Zima, this time to assess its needs and make recommendations for an expansion of its facilities.

Making the right choice

Zima says that, too often, companies assume they don't have enough space in their existing facilities.

"They think it's cheaper to build a building rather than better utilize what they have," says Zima.

A common mistake, he says, is failing to use the height of a building to its full advantage. The most economical way to go is up, not out, he advises. Using the appropriate shelving, racks and equipment, companies can make their spaces much more efficient.

Zima points out that a forklift, for instance, needs a certain amount of space to allow the operator to turn around. The easier it is to turn around in an aisle, the faster the operator can move from one location to another. So, he notes, it's critical to know what kind of forklift the business is planning to use.

Managing an expansion or reconfiguration is key, says Zima. The relocations of product that are necessary for the changes can create confusion. Without preparation, product can be misplaced or damaged, resulting in lost sales or, worse, botched orders and miffed customers. Employees have to be prepared as each step occurs.

Zima recommends the work be done in stages, carefully planning to minimize disruption of routine activities.

Says Zima: "If it's not properly managed, it can put you out of business." How to reach: Bulldog Office Products, www.bulldogop.com or (412) 787-3333; Lawrence Zima Consultants, (412) 788-0133

Monday, 22 July 2002 09:35

$tart it up

I read recently that Ron Wood, guitarist for the Rolling Stones, had gone into rehab to kick his alcohol habit.

The media reported that Ronnie wants to make sure he's in good shape when he and his mates hit the stage on their next tour.

I saw the Rolling Stones in 1994 at Three Rivers Stadium. I'd never seen them live, and I guess my preconception was that it was going to be fun but a sloppy presentation, given the reputation of the Stones as the perennial bad boys of rock.

People who live like these guys are lucky they can stand up, let alone put on a decent two-hour show. Boy, was I wrong.

The thing that has stuck with me ever since is what pros these guys are. The Stones have lasted 35 years in a business in which careers are often measured in months. Love 'em or hate 'em, there are reasons they have been successful that go beyond their penchant for turning three-chord ditties into million-seller classics or Mick Jagger's androgynous prancing on stage.

Quite simply, it's been good business sense, and entrepreneurs could learn some lessons from the Stones. Here are a few:

Vision. The Rolling Stones could set up their gear in any stadium in the world, charge $100 a ticket, fill the seats and walk away with lots of cash. But for some of their more recent tours, they decided to go with some lavish and expensive sets that took a couple of days to set up in each city.

As I recall, it cost $1 million a week to keep the Voodoo Lounge tour on the road. With the huge overhead, I'm sure they couldn't make too many mistakes before the profits would begin to dry up.

Planning. Appearing in 50 or so cities and making sure there are hotel accommodations for the crew, security for the performers and adequate advance publicity poses a logistical challenge. And the Stones' organization hired a big-time British agency to promote not only a recent tour, but the Rolling Stones brand as well.

Execution. This is the step that really counts when it comes to performers and entrepreneurs -- and where the wheels can fall off, even if everything else goes well. It was clear that, no matter what kind of shenanigans these perennial adolescents where engaging in behind the scenes, the Stones weren't about to let things go along haphazardly on stage.

The act was carefully choreographed to appear spontaneous. They played their oldest hits with the freshest enthusiasm. Keith Richards played his signature licks flawlessly, Charley Watts beat his drum kit with digital precision and Mick Jagger traversed with the energy and intensity of an Olympic athlete.

All of the hype, massive stage riggings and fancy costumes would have been for naught had the Stones simply gone through the motions.

Please the customer. It was plain to see that the Stones weren't content to simply rest on their laurels. They acknowledged and thanked the audience, something that too many performers, some of whom prefer to display body parts or spit on people in the front row, don't seem to think is "cool" anymore.

Maybe Wood made a unilateral decision to dry out, but I wouldn't be surprised if he got some pressure from the Stones' organization to clean up his act before they went on with theirs. They're not likely to let anyone, even one of their own, get in the way of their satisfaction. Ray Marano (rmarano@sbnnet.com) may not prance around the publication office with androgynous enthusiasm, but as associate editor of SBN magazine, he gets his satisfaction turning the likes of rock 'n' roll ditties into motivational lessons for entrepreneurs.

Monday, 22 July 2002 09:34

Tech trek

As Roger Byford, president and CEO of Vocollect Inc., demonstrates the Talkman, it's readily apparent just how good its voice recognition technology is.

He responds to prompts from an automated voice and the device captures his responses to "remember" how he says words and phrases. Vocollect's Talkman does it just as easily with Byford's British accent as it would with a Western Pennsylvania twang or an Arkansas drawl.

In a traditional warehouse setting, workers use pick lists, a printed list of items to be collected for delivery to a customer, to locate and select cases of merchandise for shipment. Typically, the employee identifies a location of an item in the warehouse by a number or combination of numbers and letters, goes to the location and selects the quantity specified. A label bearing information about the item -- price, size and warehouse location, for instance --is peeled from the pick list and attached to the case.

The Talkman eliminates the need for pick lists and stickers, relying instead on the operator's response to the orders the Talkman issues and the user's responses to those orders. Because the device is attached to the user's belt and employs a microphone and headphones, workers have both hands free virtually all of the time.

Vocollect's technology seems uncannily appropriate for this kind of application. It can be customized to the customer's particular use. Because the system requires no pick lists or labels, stray paper doesn't stick to

floors and equipment and warehouses stay cleaner. It eliminates annoyances like the difficulty in making labels stick to frozen food cases. And the check features of the system reduce selection errors and help warehouse operators spot merchandise misplaced on its racks.

Yet Vocollect endured no small amount of anguish trying to sell its technological wizardry, which initially targeted the manufacturing inspection market, to one set of users. It decided it had to identify another market if it planned to survive and grow as a company. But adversity and frustration pushed it to find new applications -- although not without growing pains -- for the clever technology it had come to master.

Vocollect ultimately found its market and adapted its know-how to it, but only after it became clear that it needed to change its focus and look for an easier sell.

Where's the market?

The marketplace didn't hear Vocollect's message nearly as clearly as the Wilkins Township company's Talkman comprehends users' utterances.

Much of the problem was unfortunate timing. The recession of the early 1990s hit its target customers hard. The final thawing of the Cold War was accompanied by the drying up of defense contracts.

Larry Sweeney, co-founder and vice president of marketing, explains how the company made the shift from the manufacturing market to the grocery warehouse market.

"Going from manufacturing inspection to warehousing, that's easy," Sweeney says. "The 1990-91 recession hit, and we laid off half the company. We needed to find a recession-proof industry."

Says co-founder Mike Gabrin, vice president and chief technology officer: "Things weren't going well in that time frame. We're selling to automotive, the first thing to go in a recession. The Cold War ends, we're selling defense electronics."

Vocollect's picture today is markedly different. It has found enough success to place among the 50 fastest-growing technology companies in Pittsburgh in the $5 million to $10 million annual sales category and is approaching the 100-employee mark.

Its growth forecast is rosy enough for the owners to commit to a new headquarters building designed to accommodate 300 employees.

A new focus

Vocollect hasn't abandoned the effort to apply its technology to the manufacturing environment, but it has scaled back after pounding doors and walking the shop floors of factories and plants for several years. Instead, it is concentrating on the warehousing market, customers which proved more desperate for a solution like what Vocollect had to offer, more willing to give it a try and more amenable to sharing their experiences with their peers.

But the shift didn't come until the founders realized they were failing to make an impact on the market they believed was perfect for the solution they could provide.

A solution looking for a problem

Byford, Gabrin and Sweeney worked for Westinghouse in the 1980s in the emerging field of voice recognition technology. When they left in 1987 to start Vocollect, they saw manufacturing inspection as a ripe market for voice recognition technology applications.

Quality control workers could inspect a part or an assembly and note potential problems that might indicate a problem upstream in the manufacturing or design process. A sag in the paint or a poorly fitting panel could be recorded and the data off-loaded to an information system that would collect it for analysis.

Problems in the process could be spotted early, allowing the plant to make adjustments or corrections before things got out of control. But while the manufacturing field could apply the technology -- companies including Ford, Saturn and Raytheon Corp. bought into it -- what Vocollect offered didn't provide (in manufacturers' minds) the clear advantages Byford and his partners thought it would.

"I think we were very much an organization that had a solution that we were trying to apply to problems," says Gabrin.

Byford recounts why the manufacturing arena, which originally appeared to be the prime application for their technology, proved so difficult to penetrate.

"You could sell to one Ford manufacturing facility, for example, and when you went to the one down the street or across town or in another state, it was another empire, almost autonomous, with another whole selling process to go through and a set of folks whose priorities might be completely different," Byford explains.

The managers at a Cleveland plant didn't much care what had been accomplished at their company's Atlanta site.

"It was difficult to replicate even within one company," Byford says.

And the competitive nature of the auto companies stifled any sharing of ideas within the industry.

Just as problematic for Vocollect was that companies in unrelated industries had little interest in what it had done elsewhere. Byford recalls an instance in which it tried to sell its technology to a company that produces nipples for baby bottles. To that prospect, Vocollect's track record meant nothing.

"The fact that we were doing things with Ford didn't mean a thing to them," says Byford.

The owners had promising technology that worked well, but not enough customers who found it sufficiently attractive to buy.

"We have customers who think the product we sell them is nice and does a good job, but when push came to shove, it wasn't mission critical," says Gabrin. "We wanted to find something that was mission critical."

Vocollect's partners learned a valuable lesson: They had a dazzling, inventive technology but weren't pursuing the strongest market for it.

"Just because you can do something doesn't mean you should do it," says Sweeney.

Seeing an opportunity

Gabrin visited a hardware distribution warehouse in St. Louis to see if it was a prospect for Vocollect's technology and came away a believer. The operations are complex, rely on large labor forces and have to meet tight deadlines for deliveries.

"It took you three seconds to watch them do their job, knowing the technology we had, to say there's an application," says Gabrin.

The warehouse environment proved a particularly good fit for Vocollect's technology for several reasons. First, it had the potential of cutting the cost of labor for picking, often more than half of a warehouse's total labor costs. It would eliminate case labels and allow workers to have two hands free at all times, thereby increasing productivity.

It could reduce the trash produced by the label backing paper and pick lists. And it could provide features such as spotting merchandise that was slotted in the wrong location or allowing pickers to go back to a previous item to double-check whether they had made the right selection.

Finding partners

About the time that Vocollect identified a new target market, some favorable events occurred. A major competitor in the warehouse market had been floundering and was sold off by its investors. And in the mid-'90s, high bandwidth radio frequency technology became available, making wireless transmission of large blocks of data more practical.

But while the market was a natural one, it also posed some challenges. In a manufacturing inspection setting, Vocollect's equipment could fail without a major disruption of operations. It wouldn't be so simple in a warehouse. The application would be central to a fundamental function in the warehouse environment.

"One difference on the inspection side was that it really wasn't mission critical and that falling back to paper and pencil was easy," Byford says. "The difference we faced in the warehouse was it was absolutely a mission-critical operation."

There were other technological barriers, as well. The hardware had to function in environments with wide variations in temperature and humidity. And it would have to be durable enough to withstand the bumps it would take in a warehouse situation.

Manufacturing proved a demanding environment for Vocollect's hardware, but the use by inspectors who worked at benches or walked around cars on an assembly line was nothing compared to the punishment meted out by warehouse workers.

"We thought we had a rough, tough environment in the manufacturing arena," says Byford. "We had no idea."

Vocollect set its sights on one of the largest grocery warehouse operations in the country to try to establish a foothold in the industry. It targeted Wal-Mart, the Bentonville, Ark., retail giant. Vocollect's top executives realized they had the software capabilities to meet the needs of the warehouse business, but recognized that with a small company, they needed to beef up their credibility.

To do that, they teamed with Telxon Corp., of Milford, Ohio, a well-known designer and producer of wireless and mobile information systems and a public company with 1999 revenue of $365 million, to design the hardware to be used with Vocollect's software. Together, they came up with the Talkman, a rugged but lightweight unit that mounts to the user's pocket or belt.

Wal-Mart proved a lucrative partner for Vocollect. In 1992, the retailer launched its supercenter concept, a combination discount store and full-blown supermarket, and was looking for ways to maximize productivity as officials implemented a plan to build five new distribution centers a year, each capable of supplying 100 supercenters.

With a company of that size, even small productivity improvements translate into large savings. As Byford points out, Wal-Mart's realization that no system would be absolutely perfect coming out of the box helped in the development of the product, which resulted in the Pick Manager software, which powers Vocollect's warehouse systems. By 1997, six Wal-Mart distribution centers were using the Vocollect technology.

The work for Wal-Mart has paid off. The company has systems installed in 16 of the retailer's distribution centers and expects to move into other Wal-Mart warehouses. It has sold into operations such as Roundy's Inc. of Pewaukee, Wis., a $2.9 billion wholesaler with eight distribution centers in five Midwestern states, as well as Kroger's and Drugstore.com.

The experience that Vocollect has gained with the warehouse industry applies to a very large market, one that goes beyond groceries to segments such as pharmaceuticals.

"A lot of these other areas look really interesting to us," says Sweeney. "There's a lot of volume there, and we can leverage our warehouse experience with these guys."

Obstacle turns into opportunity

What would have happened if Vocollect hadn't faced the problems it encountered in the early 1990s? It might have missed out on a golden opportunity, according to one of the partners.

"Our competitors would have found the warehouse market, probably before we did, and we would have been playing catch-up," Sweeney says.

While Vocollect has identified a niche in which it can leverage its success in grocery warehousing and gain advantages in similar types of operations, the founders believe that significant opportunities remain in manufacturing. Vocollect, says Byford, has a deep understanding of the technology, which creates a barrier of entry to potential competitors, and the technology has become more widely accepted.

This time, however, it will sell most likely through third-party systems integrators which will incorporate it into larger packaged solutions, and not directly to the end users.

"I think there's still a good application there, but I don't think it's the place to start a business," says Byford.

Perhaps not, but it may yet be a place to grow one. How to reach: Vocollect, www.vocollect.com; Telxon Corp., www.telxon.com; Wal-Mart, www.wal-mart.com

Ray Marano (rmarano@sbnnet.com) is associate editor of SBN Pittsburgh.

Monday, 22 July 2002 09:33

Planing and planning

Let me tell you about my home office.

Well, it's not really an office. It is, however, where I spend much of my time at home these days. And it's a place where I do work that is as challenging and rewarding as anything I've ever done for a living.

First, a little background. About 20 years ago, I came across a book that described how to build musical instruments. I already owned a few woodworking tools, so I decided I'd give guitar-building a try. A few months later, I had actually managed to put together a crude but remarkably good-sounding guitar.

Thus encouraged, over the following two years or so I built a few more, each one a little better than the last, although by no means a great instrument. Since then, however, I've done little more than dabble in it.

Last summer I visited the C.F. Martin Co. in Nazareth, Pa., the most esteemed builder of acoustic guitars in the world. After a tour of the factory, where the scents of freshly cut rosewood and mahogany teased my nose, I got the bug to build again.

This time, though, I decided that I needed to get my shop in order first. I laid out a floor plan to try to get the most out of the 11-by-15 space in my basement. I researched to find the right tools to outfit the tiny shop and reviewed my books on guitar-making.

I spent a day sharpening my old chisels, planes and knives. I trekked to stores well out of the way and pored over endless pages of catalogs and brochures. I built three new workbenches. I made patterns, jigs and guides to handle the specialized operations that building guitars requires.

I kept in mind that I was laying the foundation for not just the first instrument but for the second, the tenth and, if I get really good at this, perhaps the hundredth.

So far, things have gone really well, although I'm going to make some changes to the original plan. I've finally admitted to myself that the ugly brown cabinet that's been in the corner for who knows how many years should go. And I'm not real happy with the metal utility shelf units that I thought I could live with.

But the changes I've made will make those other things a lot easier to alter. I've got 300 percent more bench space and a lot more storage capacity, and it seems like I actually have more room to work, thanks to a better floor plan and relocation of a few things to the garage.

Two additional light fixtures and three more electrical outlets make things safer and more convenient. New power tools take some of the guesswork and drudgery out of the work.

In retrospect, I suspect, doing this isn't much different from building a business. I needed to have a vision of what I wanted to accomplish, a plan to implement it and the motivation to make it a reality. I needed a little cash and a lot of sweat equity. Lacking any of those, I probably wouldn't have accomplished anything close to what I've come up with. It's not Norm Abrams' shop, but, hey, I don't have my own television show.

I haven't finished my first guitar, so I can't judge the overall success of this venture. I got one surprise, though. The planning and the preparation to reach the ultimate goal turned out to be an end in itself.

I've learned firsthand what a lot of entrepreneurs have been telling me over the years: Getting there is at least half the fun. Ray Marano (rmarano@sbnnet.com), associate editor of SBN magazine, now is pursuing the other half of the fun. And don't worry; he's getting there. Wanna buy a guitar?

Monday, 22 July 2002 09:33

A design for designers

Bally Design's offices and studios on North Craig Street occupy the space of a former automobile dealership. The word "Oldsmobile" embedded in the floor tile mosaic and a long bank of glass-front offices confirm its former identity.

But the showroom these days displays models of vacuum cleaners, hand and power tools and a variety of other products that Bally Design has developed for its clients.

While the close attention paid to the details of a consumer product like an automobile might seem perfectly harmonious with the activities in an industrial design studio, the similarity between a design studio and an auto dealership might not seem so apparent. Although the original tenant's function was starkly different from that of Bally Design's, the space works remarkably well for the design firm, which has used it creatively and economically, with a few alterations, and molded it to its own uses.

That's important, because the way the space fills the design firm's functional needs is critical, says Frank Garrity, Bally Design's president.

"It impacts every single interaction that our company has with its employees, its customers, their teams that come here to work -- everything," says Garrity. "I would put it No. 1."

Garrity points to one example of how the office affects business. Bally's clients' employees often come to its offices to work on projects with designers. Officials from athletic shoe manufacturer adidas, for instance, came from all over the world to the offices last year to discuss product design issues and got a surprise.

"They were amazed at how much they could accomplish in a short time if they were all in the same room, focused on the same issues," says Garrity.

Garrity's own office is between the showroom and the designers' areas. Doors in his office, which he usually leaves open, connect the two areas. It's an arrangement he prefers because it creates an openness that allows staff members to pass through and share ideas or discuss projects in a casual manner.

The company did make some changes to improve the work areas. To create a large meeting area, a wall was eliminated between two smaller spaces. The resulting room is large enough to accommodate a couple dozen people to exchange ideas or formulate strategies.

Some ideas were cheap to implement. Panels of an inexpensive product used for sheathing in building construction were covered with fabric and attached to most of the walls to allow design team members to pin up ideas during brainstorming sessions.

"You can pin on every wall in our space," Garrity says.

Bally even designed some of its own lighting. Light fixtures in one of the work areas were designed and fabricated by designers in-house. While they look like stylish units that would fetch a tidy sum in a specialty store, they are constructed of sheets of foam core, a few feet of guy wire and off-the-shelf commercial lighting components.

"It was a good, cheap way to get good lighting," says Garrity.

For business owners who are contemplating a new space or a new design for their existing quarters, he suggests considering how employees and clients interact.

Says Garrity: "I would start on the work habits, how teams interact -- client teams and internal teams." How to reach: www.ballydesign.com

Ray Marano (rmarano@sbnnet.com) is associate editor of SBN magazine.

Friday, 28 June 2002 07:54

Consultants in a quandary

When CLG's management informed its employees that the company had been sold, the announcement hardly caused a stir.

"In April of 1998, when the announcement was made, it was the most uneventful day in our company's history," says Leslie Braksick, president, CEO and founding partner of CLG, a Moon Township consulting firm that provides executive coaching and helps companies develop human resources strategies, processes and behaviors.

CLG has offices in Pittsburgh, San Francisco, London, Singapore and Atlanta, and an operations center in Morgantown, W.Va.

Doing lots of preparation for the change of ownership and engaging employees in the design of the blueprint for the sale ensured no one was caught off balance by the transaction.

Had the same message been delivered just a couple of years before that, however, the reaction would have been a lot different. CLG was -- and is -- a much different company than it was in 1996. It's now back in the hands of two of its original partners, its employees through an employee stock ownership plan and 17 investors.

And it's larger, with 180 employees and $22.5 million in sales last year, with a healthy increase in revenue expected this year.

But perhaps most significant change is that CLG is now governed by management, an organizational structure and processes that were lacking in its early years, threatening the health, if not the very survival of the company.

CLG, launched as the Continuous Learning Group in 1993 by Braksick and two partners, Julie Smith and Larry Lemasters -- who sold his interest in the company as part of the 1998 buyout -- had by most measures done well in its first three years. It took in revenue of $1.2 million its first year of operation and doubled that figure every year for its first five years.

By 1996, it had 60 employees, contracts with Fortune 500 companies -- and some knotty internal problems.

CLG was founded by partners with a passion for their profession but not necessarily a burning desire to run a complex business, says Braksick. When it operated on a smaller scale, the partners could easily make decisions and communicate with employees and each other.

"There was a person-to-person model of operating, and it really worked pretty effectively," says Braksick.

But as the business grew and took on larger and more numerous clients, the channels of communication and the control the partners exercised began to erode.

"Because of our growth, we had gone from three partners running the business to nobody running the business, because it wasn't clear who was in charge. So then it became which of the three you could access," says Braksick.

And CLG was wrestling with other problems faced by many fast-growing companies. The partners were handling a substantial amount of the hands-on work on client projects and were less focused on the nuts and bolts of running the business.

Taking on large contracts with big clients created cash flow pains as payment schedules were stretched over several months. To ramp up for projects, the company needed to hire additional consulting and support staff but didn't want to expand its capabilities too rapidly.

"Because of our growth, we got to a point where we really needed processes to govern us," says Braksick. "We missed that. We didn't get those processes in place fast enough."

Communication breakdown

An inherent strength of CLG exacerbated the communication issue. The company hired consultants and allowed them to live anywhere they chose, reasoning that requiring them to relocate to a central location was an obstacle to recruitment. If prospective consultants wouldn't have to uproot their families to join CLG, it would have a larger pool of high-caliber professionals to recruit from.

"We set up the company to work on a virtual basis, and we were pretty successful at that," Braksick says.

But the lack of structure and communication fostered misunderstandings and created isolation between the partners and the consultants. Because consultants are compensated by a combination of base salary, billable days and corporate profitability, there's an incentive to work as many days as possible. However, in some cases, consultants were working fewer days than they desired in some months, although CLG had contracts secured that would provide ample work in future months.

But without a system to routinely and smoothly keep consultants up to speed on upcoming projects and the role they might play in them, the consultants operated in an environment of uncertainty. That, says Braksick, sowed the seeds of discontent within the ranks.

The warnings surfaced gradually. Terse, just-the-facts e-mail messages replaced the collegial ones that Braksick and others were used to receiving. Subtle changes in tone of voice and body language signaled employees were unsettled. Braksick began to hear second-hand disparaging comments about the company by some employees.

Questions about compensation and the roles of the partners came up more frequently. And the partners found they were making decisions that, at times, worked at cross purposes with each other.

As with many growing companies, systems and support systems weren't put in place rapidly enough to accommodate expansion and change.

"The biggest red flag was rapid growth and change without the infrastructure to support it," says Steve Jacobs, a senior partner.

Bodega Bay

In 1995, CLG landed a large contract with Chevron Chemical Corp., now ChevronTexaco Corp., in San Francisco that would take two years to complete and stretch CLG's resources nearly to the breaking point.

"We all started running very, very fast," says John Dale, CLG's vice president of e-business.

There was a sense at the company, says Dale, that the Chevron project was a make-or-break for CLG.

Braksick, who had a 10-month-old baby, took the lead on the project, commuting a couple of times a week on a red-eye flight between California and Pittsburgh. After a few months, Chevron offered her a house and a car near its headquarters to allow her to eliminate the travel and stay with her family. The arrangement eased her domestic situation but further isolated her from the day-to-day operations at CLG.

Ultimately, Braksick says, she and her partners realized they needed to take serious action to unearth the internal turmoil and get everyone back in step.

"We knew that there were issues. We knew that we had to step back, regroup, right the ship and figure out how to do things a little bit more systematically from a process standpoint," Braksick says.

CLG hired a consultant to take a fresh look at the company. He interviewed everyone at CLG and briefed Braksick and her partners on what he'd found.

Now, with no doubt that CLG was buckling under the strain, the partners planned a two-day meeting in Bodega Bay, Calif., where employees could throw their issues onto the table, and hired a facilitator to channel the dialog into a useful, constructive direction.

The first day was emotional and tempestuous for the partners and CLG's employees as the hurt feelings and misunderstandings came to the surface.

There were angry, loud exchanges. Employees poured out their frustrations and anxieties. Some broke into tears, others confessed their own complicity in feeding the flames of discontent.

"It was gut-wrenching, very emotional," says Braksick.

The disillusionment ran deep. Jacobs, who had joined CLG just months before, said he made it clear he had real reservations about recommending clients or colleagues to CLG if things didn't change. Even in the brief time he had been with the company, he'd witnessed things that were troubling to him. He didn't hold anything back.

"I became famous for my candor that day," Jacobs says.

Royce Heiskell, CLG's chief financial officer, had joined the company only a few months before as well. Heiskell had been recruited from an architectural firm and had spent a good chunk of her career at a Big Six accounting firm. After the first day of the Bodega Bay meeting, she says, she wondered if she had made the right decision.

"I remember going to my room and thinking, 'Maybe I'll be looking for a job next week,'" says Heiskell.

Heiskell says the candor was unlike anything she'd experienced.

"In my previous experience, I hadn't seen a company be so frank and open and lay it on the line like that," says Heiskell.

But by the end of the second day, she says, the doubts raised on the first day had dissipated.

"We had a really strong feeling that we were a company that was going to overcome this and go forward and be stronger," says Heiskell.

But the facilitator who had helped employees get their concerns out wasn't as optimistic. Braksick says he gave the company about a 5 percent chance of healing.

Dale describes the Bodega Bay experience as a "flight to health," in which the company realized its shortcomings and vowed to fix the problems. But, he says, it took a second company meeting at Bodega Bay some months later to cement the structural changes.

At that meeting, the company selected a more rounded leadership group that was more likely to speak up and voice their opinions and concerns. It put Braksick in the CEO spot and put an end to the mushy structure that having three partners at the reins had fostered.

Beefing up staff

CLG had a critical need to bulk up staff to provide support to consultants in the field. It added a travel agent -- even though there wasn't an immediate need for a second one-- to coordinate consultants and travel and ease the workload.

Staff was added to retrieve and modify documents to fill requests by the consultants, and someone was hired for sole purpose of launching new projects.

Dale says he believes the company survived because its leadership took a hard look at its own role and made a genuine effort to correct the problems.

"I really believe our leaders were pretty introspective about their leadership of the company," says Dale.

Jacobs gives credit to CLG's employees, whom he says work hard and set high standards for personal achievement, yet never let their egos and personal gratification get in the way of working as a team. He says it took the 3 Cs -- commitment, courage and candor -- for everyone to own up to their responsibility to the company and to each other.

And he doesn't view the Bodega Bay experience as an unusual one for companies.

"My personal feeling is that something like Bodega Bay is a defining moment at some level and quite appropriate and necessary at some level," Jacobs says.

Braksick says she had to shake the feeling that she was responsible for the problems that led up to Bodega Bay.

"I never felt like I had screwed something up so significantly, so I had to just swallow it and move forward," Braksick says.

These days, she says, issues are out in the open and everyone is encouraged to bring up concerns. And the lines of responsibility and processes for bringing those concerns are clear to everyone.

"We're not perfect; we're highly imperfect," says Braksick. "But we talk about everything." How to reach: CLG, www.clg-online.com


Keeping the lines open

When companies move into fast-growth periods, they often encounter difficulty lifting their noses off the grindstone just when it's most important to take a look around and see what's really going on.

Reflecting on the experience of CLG, Leslie Braksick, its president, CEO and a founding partner, recommends that leadership not lose sight of activity within the company. She suggests that leaders:

* Recognize that peak periods may be the best time to examine whether the processes in place are the ones that are needed.

* Reflect on how well they are living their vision and values.

* Structure formal communications about the health of the processes that contribute to running the company.

Friday, 31 May 2002 12:54

Altering the vision

Jeff Pepper experienced firsthand the isolation and boredom that can prevail in an eldercare facility when his father lived in one during the last years of his life.

After that experience, Pepper decided to retire from ServiceWare, the company he had founded, and launch ElderVision, a venture that would provide seniors in eldercare facilities with easy access to the Internet and a way to stay in touch with friends and family.

ElderVision raised $1.2 million in early 2000 and began to burn it up in development costs and an effort to fast-track the concept to be first to market. The company ran out of money by the end of the year, and Pepper kicked in $600,000 of his own cash.

In early 2001, ServiceWare's stock, Pepper's principal asset, took a dive, and his holdings dropped 60 percent in value. After a conference call with ElderVision's advisory board, Pepper suspended operations.

With no cash, $1 million in debt and 45 investors holding worthless paper, Pepper decided to reboot the company, converting Eldercare from a total solution to an applications service provider.

"I felt if I walked away, I wouldn't be able to look them in the eye again," says Pepper.

Pepper and his team agreed to work for no salary to get things running again. They negotiated with vendors for a workable payment schedule. The software development was outsourced to offshore developers, and ElderVision revamped the product to allow nursing home operators to acquire it for $500 rather than the $100,000 the previous version would have cost.

They offer it under a licensing agreement for each resident user, who pays a modest membership fee and a monthly subscriber's fee. ElderVision is now targeting large national players to purchase the service.

In retrospect, Pepper says, the race to get to market first was misguided. Caught up in the frenzy of the dot-com boom, ElderVision had its sights set on a fast ramping up of the company and a public offering that would make its investors a fast bundle. But getting to the finish line first proved extremely expensive and almost sank the company.

"We slowed it down," says Pepper. "If you fast track, you burn money real fast." How to reach: ElderVision, www.eldervision.net

Tuesday, 30 April 2002 07:53

Jack LeVan

Jack LeVan has a long list of reasons for coming to Vocollect Inc., the Penn Hills-based company that produces voice recognition solutions primarily for warehouse and distribution center applications. Most of them, however, boil down to Vocollect's position in its industry, its customers and the man he has replaced as its president and CEO.

In January, LeVan took over the job one of Vocollect's founders, Roger Byford, had held since the company launched in 1987. Byford, an engineer by training, has settled in as chief technology officer, a role Byford says suits him a whole lot better. And LeVan says he's convinced Byford is more than willing to give up the reins.

"I've met lots of founders who said they meant it, but they really didn't," says LeVan. "Roger truly means it."

LeVan will leverage his experience and Vocollect's potential to build a bigger presence in Europe and to transfer Vocollect's technology to a wider range of applications.

He's got a handsome roster of customers to work with. Vocollect boasts retail giant WalMart among its clients and enjoys a solid relationship with Giant Eagle Inc., a company LeVan describes as "a good strategic partner in helping us understand how to support a core market."

LeVan comes to Vocollect with hefty experience in automated data capture technology. He spent the past seven years as a senior manager at two such companies, most recently in San Diego as CEO of SCS Corp., a producer of radio frequency identification tags and scanners, and in Vernon Hills, Ill., at Zebra Technologies Corp., a company that produces bar coding products and that had $450 million in sales last year.

And how does Pittsburgh stack up against those locales?

Says LeVan: "In terms of a supportive atmosphere and a network of people who want to help one another, this is better than both of those places." How to reach: Vocollect Inc., www.vocollect.com

Thursday, 28 March 2002 11:04

Getting it right

Bob Plummer took a number of swings at getting the marketing component right for his personal shopping service, Hours To You.

He missed every time.

After three years of trial and error, he says, he got it right when he engaged Decision Partners to research the market and figure out what the barriers were to potential customers trying the service.

Decision Partners' research, which involved in-depth interviews with customers to determine what their underlying beliefs were about Hours To You and the rationale for those beliefs, uncovered several barriers, most prominently an inability for potential customers to visualize what it would be like to use the service.

"I confirmed with the data the priority we should put on our marketing message," says Plummer.

The next step was to have AD 1 Partners, armed with the information gathered by Decision Partners and its interpretation of the data, create a direct mail piece and a brochure designed to overcome those barriers.

That process, says Plummer, has produced significant results for Hours To You.

The campaign addresses the obstacles to using the service, and Plummer has discovered that customer acquisition costs have dropped by half. And, he says, no other efforts were initiated to build the customer base during that time that could have skewed those results.

Essentially, Plummer says, "We took the services and products we had and found a better way to market them."

Just as important, Plummer says, he believes that having a clear picture of what customer perceptions are makes it easier to grow the business. Knowing that the barriers to using the service can be overcome, other parts of the operation, like product offerings or fee arrangements, can be altered to reach growth targets without worrying the message isn't right.

"The value to us is that we've taken the guesswork out of our marketing and communications tools," says Plummer. "We were able to use them more effectively, more than we have in the past."

How to reach: Hours To You, www.hourstoyou.com or (724) 657-1523

Tuesday, 26 February 2002 13:15

Stamp of approval

Retailing is a tough business. Just ask Ames and Kmart.

To grab an edge, retailers are bringing back some old tactics. One of the more interesting is Shop 'n Save's introduction of S&H greenpoints, a dusted-off version of the stamps retailers used to give customers to paste and save until they had enough to redeem them for merchandise. This time, shoppers who register accumulate credits for their purchases when they shop; spend a dollar, get 10 points, more if you buy certain featured items.

When you've got enough points, you redeem them online or through a catalog for anything from a cruise to a gas grille to a discount on groceries. This time around, the whole process seems a lot less cumbersome than the "licking and sticking" that used to be part and parcel of saving stamps on S&H's first go-round.

The attraction of stamps faded by the mid-1960s, mostly because retailers then were looking for an edge, too. One way to get that was to drop stamps and cut prices. The rise of the big retailers like Kmart made it easier to shop in one location to buy the stuff that the stamp catalogs offered and probably did its part to lick the stamps, so to speak.

The folks from Shop 'n Save and S&H emphasize a built-in advantage of the program, noting that their market research indicates that more than four out of five people in Western Pennsylvania recognize and remember S&H. What would most companies do for that kind of brand recognition?

At a press conference to roll out the greenpoints program, at least three people, myself included, noted they got their first baseball glove -- an early rite of passage of sorts for kids in the late 1950s, the heyday of the stamp business -- with S&H green stamps.

In these complicated and uncertain times, there may be a yearning to return to a seemingly simpler era that the image of stamps conjures up. If shoppers find accumulating greenpoints less of a hassle than they're willing to put up with, the idea might catch on.

Oh, yes, and the most critical factor of all: They do have a baseball glove in the catalog. Maybe they won't drop the ball.