Optimizing opportunities Featured

8:00pm EDT April 24, 2006
For A.C. Coy Co., the purchase of a piece of Stargate Industries out of bankruptcy provided the company with new and valuable human resources, a fat increase to its top line and new client opportunities.

It also brought growing pains. The new structures necessary to serve a larger organization left some employees uncomfortable. It chafed enough at some that they decided to leave. And while the acquisition brought new opportunities, says CEO John Yocca, it also carried with it more demanding customers with higher expectations.

For a business whose core activity is finding and placing IT talent, inadequate organization and staff disruption could have been disastrous. But Yocca didn’t flinch. Instead, he hammered out a formation that allowed A.C. Coy to take advantage of the acquisition.

Now, at 140 employees and $10 million in annual revenue, Yocca’s company is a bigger and stronger business.

How has A.C. Coy grown so rapidly?
Two years ago, we added a lot of growth when we acquired part of Stargate Industries when it went into bankruptcy. That added a big boost to our top and bottom lines. It tapped us into new customers that we hadn’t worked with in the past and we also picked up some very experienced professionals that had been in this business for quite awhile — sales and technical people.

That was a major thing for us. It probably added about 20 percent to 30 percent to our sales numbers. Our biggest challenge was the integration of the new people into our current company. We had some people turn over because they didn’t like the idea that we were changing some things.

How did you integrate Stargate employees into your company?
The key is to listen to your employees, both new and existing. We had several group and one-on-one meetings the first several weeks.

We needed to address what concerns everyone had with the new organization. It was important to flush out systemic changes versus peripheral ones. One issue which was a flash point was the sales force compensation plan, since they were significantly different. Rather than change either plan, we ended up keeping both plans and have moved toward a unified plan.

If we did an immediate change, we potentially would have lost valuable employees. Even though communication lines were open, we still had a few folks leave prior to giving us a legitimate chance. This was disappointing, since we are a people business.

How has the Stargate acquisition improved A.C. Coy?
Overall, it’s been a great move because it’s created some great opportunities for us, brought some other customers out there that maybe we didn’t have a good handle on before. With our new look and feel, they were more apt to utilize our services.

With the new focus, we’ve got better metrics, like our percentage success rates on this or what’s the turnaround on that, more formal documentation on what we’re doing. Through the acquisition, a very strategic customer started utilizing our services. This customer required us to respond with qualified consultants within a 48-hour time window.

We needed to adjust our traditional turnaround times to meet these new requirements. This forced us to rethink what we were doing as a recruiting organization to decrease our turnaround times. As a result, we were better able to respond to new customer requests, which had a higher element of time-criticalness and led to further opportunities for growth.

How do you satisfy your ongoing need for talent?
We recruit people primarily through referrals, so we’ll come up with people we think are what we’re looking for and try to focus on other people that they might know to get us additional folks.

It’s really who do we know that knows somebody else that can help us out. We guesstimate that we have 2,000 (people we’ve placed) that we’re in pretty good contact with. Even though they don’t work for us any more, they might get an e-mail from us occasionally or some other contact to find out if they know anyone who’s looking for work.

How do you foster a team environment?
The critical growth element is our internal sales and recruiting team. To get everyone working as a team, we have monthly group incentives.

Besides immediate cash rewards for a job well done, we have brought in a massage therapist to loosen everyone up. We sponsor off-site luncheon work meetings, golf outings and holiday parties. A loose and fun environment is ... critical in fostering success.

How do you keep the company on track during rapid growth?
Organization. Being fairly well-organized and having good rapport with people, interpersonal skills. I like to say our business isn’t rocket science. What we’re doing here isn’t changing the world, but it is a pretty important business.

A lot of people think it’s an easy business to do, but it’s extremely hard to do well. Anything can derail things at any time. You’re dealing with people’s lives when they change jobs, and there are a lot of factors that go into that decision.

How to reach: A.C. Coy Co., www.accoy.com