Succeeding in Good Times and Bad
Three Top 250 companies saw the economic downturn as an opportunity, not just a crisis
photos by Olivier Koning
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ProService Hawaii president of finance and operations
Mixing old and new ways
ProService Hawaii responded to the recession by focusing on its human-resources-administration business while coming up with ways to help customers through trying times.
ProService has always evangelized about its business – handling the human-resources tasks for Hawaii’s small and medium companies. ProService believes it can cut its clients’ HR costs while providing better services than were done in-house, and allowing owners and managers to devote more attention to their main business. The company saw itself in a sweet spot as more firms outsourced their HR.
But at the beginning of 2008, as Hawaii’s economy started to dive, ProService also knew it needed to find ways to become even more important to clients. It crafted a theme of improving service in a way that customers would feel and know, something that’s frequently talked about among the staff, say the company’s two leaders.
“We knew our clients would need our services more than ever,” says Ben Godsey, president of finance and operations and a co-owner of the Hawaii Kai-based firm with Dustin Sellers, president of business development and marketing.
“We knew there was a need we could fill,” Godsey says.
About two dozen people were added since mid-2008, boosting staff to more than 115. That cut into profits, but Godsey and Sellers considered it something they needed to do as seven out of every 10 clients shrank employee counts.
The new workers helped push out more information and services, and guide companies through downsizing, unemployment forms and other issues that come with layoffs.
“We didn’t look at it as risky at all,” says Sellers.
The revenue line doesn’t tell the entire story – 2009 sales were up about 1 percent to $299.2 million. Underneath those numbers was the turmoil of a recession as some clients shut down or went bankrupt.
ProService says it was able to replace that business, even though it cut the marketing budget, because the hard work paid off when the company asked clients for referrals. “We had more referrals from customers last year than we’ve ever had,” Sellers says. From December 2008 to April 2010, the client roster rose by about 4 percent and the company now serves about 1,000 customers.
ProService also has retained clients by expanding the services it offers, including finding ways to fight rising healthcare costs.
“They allow us to just run a restaurant instead of worrying about a lot of other things,” notes Rick Nakashima, a vice president for Ruby Tuesday Hawaii, operator of four restaurants with 350 employees in the state. “It’s been a real good partnership.”
Top 250 Rank
2010: 23 | 2009: 26 | 2008: 32
2009: $299.2 mil. | 2008: $296.6 mil. | 2007: $244.5 mil.
Up 22 percent from 2007 to 2009
[Doing more for customers]
Y. Hata is also looking at ways to give clients more. Besides keeping a corporate chef on staff to help clients with menus, its meat, paper, bakery and other specialists help customers fine-tune their operations.
The company is also spending more than $300,000 a year on training, and bringing in consultants to work with staff on customer service, management techniques and how to help customers make improvements and solve problems.
“Russell has done a terrific job of managing through this downturn,” says Ray Ohta, president of Pacific Training and Development, one of Hata’s consultants. Hata’s commitment to customers even includes an instance of lending Ohta to help with a client’s training program. “The (company’s) morale is very high.”
AlohaCare is trying to improve its offerings to both its health-plan members and the 3,300 doctors and medical service providers in its network. It has looked for ways to expand the provider network on Maui and Hawaii – two islands with doctor shortages.
For example, McComas says, when a Big Island doctor was called up by the National Guard for service in Afghanistan, his Hilo practice was threatened. AlohaCare arranged for someone to cover for the doctor while he was away.
“Part of our strategy is to build and strengthen our relationships with providers,” McComas says. That includes spending $2 million annually on programs that improve quality of care, he says. That money supports immunizations, pap smears and mammograms that can detect problems early rather than later, when treatment is costlier and often less successful.
The strategy also extends to another pillar used by all three of these Top 250 gainers: technology to improve efficiency and communications with customers.
It may not sound like a breakthrough, but AlohaCare swears by a new telephone system tied to its computer database. It helps connect providers and customers with its 214 staffers quickly, in addition to pulling up relevant information faster.
Similarly, ProService installed a telephone and customer-relationship management system that helps improve service and provide greater support to customers. “That has really galvanized our relationship with our customers,” Sellers says.
ProService also invested $2 million in a human-resources management system from Ultimate Solutions, software and technology that boosts HR reporting and other efficiencies while helping customers save on paper and printing.
The Ultimate Solutions’ UltiPro platform is a leading HR solution used by medium-size national corporations such as Ruth’s Chris Steak House and Major League Baseball and not normally within the reach of small business. But ProService says that, with it acting as an administrator, it can offer UltiPro to companies with fewer than 25 employees.
“The economy hasn’t been as much of a factor as an opportunity in the market,” Sellers says.
New software has helped Hata improve order efficiency and productivity, and helps analyze the company’s performance and profitability. A tracking system in the warehouse improves stocking and reduces order errors.
Those systems also give Hata information on how the company is performing, which is then communicated to employees.
“We’re not close to where I want us to be, but we’re doing damn good,” says Hata, who helped craft a vision calling for Y. Hata to become the state’s leader in “cultivating mutually successful customer and employee relationships.”
ProService has a similar vision and sees itself as giving clients more value during the downturn. That figures to pay off further in coming years.
“We viewed a time of difficulty as a time to differentiate ourselves,” Godsey says. “We viewed it as a time of great opportunity.”
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