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APU Business Leading Forward Podcast

Podcast: Transforming a Business during the Pandemic

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Podcast featuring Dr. Marie Gould HarperDean, Wallace E. Boston School of Business and
Andy Williamson, CEO, ONLC Training Centers

In 1983, Andy Williamson and his business partner took a leap and started a small business teaching people how to use the newly emerging personal computer. In this episode, APU Dean Dr. Marie Gould Harper talks to him about the decisions that helped successfully grow ONLC Training Centers into a leading national IT training company. Also learn how he has had to quickly pivot and evolve the business model in the wake of the pandemic by finding ways to reduce costs, cross-train employees, and other strategies to modify the business infrastructure and ensure the company can weather this storm.

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Read the Transcript:

Dr. Marie Gould Harper: Hello, everyone. Thank you for joining us again for a Leading Forward podcast session. Today, we have Andy Williamson. He is the CEO of ONLC Training Centers, which is located in Wilmington, Delaware.

I have a special relationship with Andy. I credit him for a lot of the things that I have learned in terms of how to transform and change an organization as it relates to the people, as well as the organizational structure. Today, we want him to discuss some of the things that have made his company successful.

Some of his history, or the organization’s history, is it was one of the first IT training companies, teaching personal computer software. It was founded in 1983, nearly 38 years ago. There are two business partners, Jim Palic, he has an MBA from Wharton. Mr. Williamson, he’s a business undergraduate from the University of Delaware.

The two of them met at DuPont, where both of them were programmers. Early ’80s was the dawn of the PC industry. How did they get started? Andy, can you share with us how you got into the training business?

Andy Williamson: Yes. Thanks, Marie. It all started when I was working at DuPont and the first IBM PCs started to come available. I would meet my future business partner, Jim Palic, and we would go to the DuPont library to find magazines on personal computers. They were so hard to find you couldn’t just go to a bookstore. It had to be this research library at the DuPont company.

From there, we realized that the PC industry was going to be big and we decided to leave our jobs. We started selling personal computers, writing software and doing some training. I actually taught courses on VisiCalc at the University of Delaware in the evening, and we would buy and sell Kaypro computers. They were some of the first luggable computers.

[Podcast: Change Management Steps Needed to Pivot]

You may have heard of the Osborne computer. These computers were the size of a sewing machine and weighed about 30 pounds or so. That was the first portable computer, but we would buy and sell those and do training and systems development.

Soon, we realized that so many people needed to learn about personal computers, that we could start a business where we would have a classroom and an instructor standing in front of the class and have groups of 12 people at a time come through. They would learn how to move from their dedicated word processors to PC-based word processing, learn things about how to copy files and spreadsheets, creating spreadsheets. It was a heady time with a lot of business because no one had ever used a PC before.

We had lots of business in just a small geography, where we would train in downtown Wilmington, Delaware, and eventually opened up in Center City, Philadelphia. And so we did everything from the ground up. We actually built the computers. We wrote the manuals, and we trained the instructors on how to teach people how to use computers.

Since that time, the business matured through the first 20 years. We went through multiple business cycles, ups and downs in the economy. In 2005, we actually started to experiment with remote training, where we could have an instructor in one location and have people in training rooms in multiple cities. It was the first time anyone had done that. We were one of the leaders in the industry with that.

At the time, we had offices in Philadelphia, some in New Jersey and even throughout New England. And so we became a moderately successful regional training company at that time with a half a dozen or so locations doing standup, instructor-led training where the classroom, as well as this remote classroom instruction.

Dr. Marie Gould Harper: That sounds exciting, and it seems like you had an idea in the beginning, and as time went by, you just grew it, diversified what you were doing based on what was happening in the market. That’s one of the points that we want to get out to a lot of leaders, especially as we go through this new norm, post-pandemic, what do you need to do in order to transform your company to another level? The example that you just provided shows how your particular company did that. Now, when did you really see your business start to take off?

Start a Business degree at American Public University.

Andy Williamson: Well, ironically, it happened during the Great Recession of 2008. The 20 years prior to that was almost like just preparing us for what was about to happen, and in 2008, we made a major pivot. Let me back up and describe a little bit about the two principals, Jim Palic and myself.

We’re both very different, but Jim is someone who’s very evidence-based when he makes a decision, and he’s very fiscally conservative and he’s good at organizing systems once we get a method of doing business to build systems around that internally.

My role is different in that I come up with new ideas and decide which locations, adding locations, where we should go, come up with new course content, and new teaching modalities. I’m more of a risk taker. As a result, I create a lot of chaos within the organization.

Between the two of us, it’s really a good balance, where someone’s got the reins in Jim’s role, and in my role where I try to push us into new areas. Over the years, I made a promise to myself, because we used to butt heads originally trying to decide what to do, that I said, “If I can convince Jim that it’s a good idea, and we should do it, then we go ahead and move forward. If not, if he doesn’t agree and I can’t convince him with evidence, then I just back down” and that’s worked since then.

What happened here is that we could see the economy sliding out from under us during the recession. We had been through other downturns and realized that if we did absolutely nothing, we would just be in big trouble if we just stayed as a regional company.

We did have some experience with the remote classroom instruction, and we decided to make a big push, an initiative that would open up training locations around the country using executive suites.

Executive suite companies are companies that will buy or lease a whole floor in a commercial office building, and then they’ll rent out one or two offices at a time and they will have a receptionist there and maybe tech support.

We leveraged that availability of executive suites to just have little training rooms around the country, and so from the period of 2008 to 2013, we opened over 300 locations from coast to coast. Every month it was another dozen locations or so, and we never looked back. We kept doing that.

Because people like to buy from local companies, we had now a local presence everywhere. What was important, too, is that we realized from our 20 years of starting a business how important classroom training is, and that the classroom is actually one component of the learning process. To be able to go to a quiet interruption-free location, and have all the equipment you need there, that that was an important part of what we called virtual training in a classroom. It’s a little bit of an oxymoron in that it’s virtual, but we do provide the room, it’s just that the instructor is not there.

From 2013 then to until just recently, we created a $20 million training organization, and we’re one of the largest IT training companies that you never heard of, because we’re very low key and we sell directly to businesses, so the consumers may not have heard about us as much. We’ve been recognized as a top 20 IT training company worldwide for the past eight years in a row.

Dr. Marie Gould Harper: Congratulations on that. That is an achievement that is worthy to be noted. And one of the things that you shared with us was about having that local presence. Speaking to that, can you provide us a little bit more background on your service and tell us how it works when someone goes to class?

Andy Williamson: Oh yeah, that’s a good question. Say, next week, if we had a schedule and you wanted to take an Excel class, there might be three or four classes that you could take next week. You just have to pick what location you want to be in and register for a class at that location.

Then when you’re sitting there taking the class, there might be five or six other people in the class with you, and they’re sitting in training rooms in five or six other cities, and the instructor is at home teaching the class remotely.

Everyone’s in their own individual area and that’s how you can take the class and it’s just like we’re talking now. Students can ask questions. You can see what the instructor is doing. The instructor can see what you’re doing. And, in fact, the instructor can take over your screen and provide assistance and show you how to do something. It’s almost like being in a face-to-face class.

Dr. Marie Gould Harper: Okay. That sounds like that’s a good opportunity for the students to collaborate as well, knowing that other people are there in the classroom with them.

Andy Williamson: Yeah, so that worked great until earlier this year, when the pandemic hit and that changed our business dramatically. In the period from the beginning of March to the end of March, we experienced a 70% reduction in training revenue.

And so although we weren’t as bad as restaurants and gyms that had to close down a 100%, we also weren’t seeing an increase in demand like the Walmarts and the Amazons, where they benefited from the issue surrounding the pandemic.

We were somewhere in the middle, and in some ways, we’re similar to the airline industry. They were still doing flights, but they had fewer people. They had to modify their schedule, and it’s similar to that in many ways, in that if we run a class and there’s seven empty seats, that’s revenue that we can’t get back, just like an airline would be, the same situation the airline would be in.

We worked through a lot of changes in the business cycles over the years, but this was really a black swan event, where no one expected it and no one had expected it to be this deep of a downturn on the economy.

We had to step back and look at what was happening, and we had three sets of stakeholders in the company that we had to address.

The first were the stockholders, and that was easy to address because we’re just a small business with me and Jim. We don’t have a quarterly performance goals per se. We just needed to stay in business. We didn’t have to hit specific numbers.

Then we have the customers that we had to keep meeting their needs, as well as the employees. The employees are really two different categories, they’re instructors and customer service people. We had to come up with a strategy of sustaining the business and addressing the needs of the stakeholders, being the customers and the employees for the most part.

Dr. Marie Gould Harper: Now, I will say that I believe that that is one of the most important lessons that I have learned from you and Jim. It’s your definition of stakeholders and how you treat all the different groups. We have the pandemic, everyone else is a little bit shaken, almost frozen in fear as to what to do next, especially as it relates to leadership and infrastructure of an organization.

I personally knew you were going to pull through, you have so many ideas, had no doubt about it, but can you share with us, what did you do? What changes did you make to stay in business and to be responsible to your group of stakeholders?

Andy Williamson: The first thing we did is not directly related to any specific group, but just we needed to tune the infrastructure. People had always had the ability to work from home, but now almost everyone was working from home all the time.

We left a core group of four or five people that would stay in the headquarters and that could physically do things like set up computers and deal with issues around the headquarters, but everyone else would work from home. They had a voiceover IP phone. They had remote desktops, and with the pandemic, we gave everyone second monitors, so they could have two screens to monitor different things.

We made a major push to implement Microsoft Teams. We talked about it for years, but kept putting it off, and Teams was a great help for making the remote work situation more closely model what it felt like to be at work, where you could just drop in on someone or chat with someone or add people to a conversation. Teams was a big help.

The other thing that we did, and this was just recently, we figured out how to get the receptionist to work from home, so that we would have someone who could personally answer the phones and keep a higher level of customer service for inbound callers rather than put them into an automated attendant. Those were a couple of infrastructure things.

Regarding our customers, I could tell you a little bit about what we did, how we changed the business model to still meet the needs of the customers in a safe way.

The first thing we did is we reduced the schedule of classes. Whereas, we might have had a class like an Excel intro run or three or four times a week, we switched it to once per week. This was important so we didn’t get one person scheduled in each event and then have to cancel them all.

If you think about the airline industry, they had to do something similar. They reduced the number of flights so that they would get a runnable number of people in each flight. Then to make it a safe environment, we guaranteed that only one person would be in a training room at a time.

Typically, if we had a classroom in downtown Chicago, and we had two people from different companies sign up for exactly the same class, they could sit side by side in a small training room that could hold two or three people.

But now because of the virus and the risks there, we guaranteed that we would have only one person in a classroom. If we had two people sign up for the very same event in the same city, we’d put the second person in another room.

Going back to the airline analogy, they did something similar, where they guaranteed that the middle seats, for awhile, the middle seats would be empty. That was something similar that we did.

Another thing that we did was we removed the scheduling fee, so that would give people more flexibility. Again, with the virus and changing childcare conditions, schools are open for in-person training, then the next day everyone has to be virtual. The world was changing so much on a week-to-week basis, no one could guarantee what their schedule was going to be three weeks from now.

We allow people to reschedule without incurring a fee. Again, this is similar to the airlines, where they would allow people to reschedule their flights with no additional fee.

Another thing that we did is we decided that we would run classes that we would traditionally cancel because they were low enrollments. Let’s say we had two or three people in a class, in the past we might say, “Oh, well, maybe we’ll cancel Wednesday’s class and you can just take it next Monday when it runs again.” Now, we decided to run the classes with the low enrollments.

This is important from the client’s perspective, because there might be a business need for the training and the timing of the class might be important. They might not want to take it a month from now, they need it this month.

I think airlines may have done a similar thing as well, where they would run flights with a dozen or so people in the plane, even though it wasn’t normally full. They might lose money on a run, but they would keep the planes running for the customers.

Finally, the thing that we did is we made it clear that our classes were virtual, and although we used to promote that the primary way to take a class would be to come to our facility, you could always take a class from your home or office.

We created additional videos to explain how people could take the class from home and what equipment they would need, and even how they could do it with a single monitor or a laptop and a monitor, so they could see the instructor as well as do their hands-on training.

Dr. Marie Gould Harper: Now, you have talked about something that I think it’s important to note. Probably for the last five minutes or so, you have shared how your organization has adapted, but also looked at very carefully and thoroughly about how your changes would affect your customers. I hear you bring up the airline industry. Was that your focal point in determining what would work best for your company?

Andy Williamson: No, not really. The more I thought about it though, it was a very similar situation like hotel rooms or seats on a plane, where once the event is gone, you can’t recover the revenue from that. It just happened to be that it was similar.

I know hotels have done the same thing, where there’s limited touch. They won’t have someone come in your room, they waive cancellation fees and things like that. I think everyone’s trying to find their own path within their business model of where they can make the customer feel safe and accommodated.

Dr. Marie Gould Harper: Good. That’s an excellent point, because so many times in the past, we have attempted a one-size-fits-all and with best practices, and you have basically shared what has worked for your organization. I think that’s going to make sense for a lot of organizations. You looked at some other industries to see what they were doing, but in the end, you did what was best for you. Now, on the customer service, with the employees, what did you do in that area?

Andy Williamson: That was challenging as well, because we did not want to lay anyone off, and yet, we had a 70% reduction in volume. There were two categories of things that special projects that people could work on that would help the health of the organization.

The first category of project is, can we get our customer service staff involved in things that help us conserve cash and reduce our expenses? Secondly, what can they do to help increase sales and be more responsive to customers?

On the first side, related to conserving cash, our biggest monthly expense was our rent. Remember, I may have mentioned that we had about 350 offices around the country, and although they were small offices, it adds up to a lot each month. Those offices are on short-term leases, and most of them expired in the end of 2020.

We got a team of people together and contacted over 200 vendors that provided those 350 offices. We made sure that all of our leases were at a minimum, set to month-to-month. We shut down some low-performing operations that maybe should have been shut down before then, and then we renegotiated rates to get some concessions from the landlords.

We also looked at things like geography. We did this recently where we looked in at Minneapolis, where we had an office downtown, and then we had maybe five offices surrounding downtown area.

We kept a key regional location north, a key location south, and one east of the city, and paused the other locations. It didn’t provide the customer with as much choice as they used to have, but it helped keep us in business by significantly lowering our monthly expenses.

Then on the other side, getting more customers or getting more higher sales. We initiated outbound calling campaigns, and this is interesting. Most people would think that wouldn’t be a big leap to do that, but over the years, we’ve prided ourselves in being more of an inbound customer service-related company.

 I remember going to trade shows, and they would say, “What separates you from your competition?” I said, “Well, we guarantee that we’ll never call you after you take a class with us.”

That’s sort of an inside industry joke, because some of our competitors would call them almost on a weekly basis. We would be hands-off and never call them at all, and figuring that when they need training, they would call us.

We had to change that a little bit recently to make sure that everyone, all the customer salespeople were productive. We had to create systems for providing them names for outbound calling, who should they call, as well as scripts and different offers for customers. We got more value from our customer service reps that way.

Dr. Marie Gould Harper: Well, I definitely liked hearing a story about your slogan. I’ve noticed that a lot of companies struggle with when asked that question and make it like an elevator pitch of explaining what separates you from all of your competitors. I’m not sure why that is a struggle for some.

Now, you are very creative. What goes through your mind when you are asked by potential clients about what makes you different? Besides that specific slogan, what’s the rest of the sales pitch?

Andy Williamson: Really our unique selling proposition that was important for a lot of people was the fact that we provided the classroom with the class, with the virtual training. Before the pandemic, when customers would buy training from us on a weekly basis, they knew that they could take the class from their home or office or from one of our facilities.

Marie, it was interesting over the course of a year, 85% of the people would take the training from our nearby training rooms, so that was unique, and no one else offered that. The classroom was very important.

Now, things may have accelerated with—they say that about the pandemic, it will accelerate trends that were going on to anyway. With more people working from home and setting up a home office, long-term, more people might feel comfortable taking a class from their home.

We’ll see what happens after people get nine or 12 months of experience working from home. When they decide they need more training, whether or not they’ll come back at that same 85% rate and prefer our training facilities or take the classes from home.

Dr. Marie Gould Harper: Okay. Thank you, Andy. You have shared your ideas and experiences with the customer service personnel, but what about the instructors, those teaching the classes to your clients?

Andy Williamson: Yes, that’s the last group that we had to make adjustments for. At one point, I think it was around 2000, we had over 70 instructors and about 30 customer service people. Since that time, we realized we could use contractor instructors, and we wouldn’t have to be concerned with what our instructors were doing on days that they weren’t training. That was always a big problem.

From 2000 to the year 2020, we changed it so that we only have three or four full-time instructors and maybe 10 favored contractors that we worked directly with. Then we have a larger list of instructors who are contractors, who work with us through a broker, and there’s folks who are traditionally a little bit more expensive because they are coming through the broker. Within the instructor group, we had three kinds of instructors, the W-2ed instructors, the favorite contractors, and the brokered instructors.

First, we felt like we had the most responsibility toward our W-2ed and favored instructors, and so we started by cross-training them so that they would have more opportunities to teach given the schedule. We also had some new projects that we worked on. We sell on-demand training, which is recorded training that people can take at any time.

We invested in some more recordings there, so we have a broader list of topics, as well as one new area, which was G Suite, used to be called G Suite. Now, it’s Google Workspace for companies that were going to a lower cost alternative to Microsoft. We created courseware and recordings for those topics.

Then the other thing that we did to help reduce costs as we got the contractors to reduce the rates for us, when they were teaching a small class of two or three people. This way, we could teach those smaller classes, and they would make a little bit of money, we would make some money and the customers would be able to get their classes that they needed. Those are some things we did with the instructors as well.

Dr. Marie Gould Harper: Well, on this section, I think it really should be noted, you mentioned it earlier, the fact that both you and Jim, one of your core values has been your employees. It’s not just all business, it’s a combination of the two. And I remember being in one of your employee meetings and you stating, “We just want to have fun.” I think that was the motto for all of us, and that’s why we gave up a 100%, because we knew the two of you were actually looking out for us as well.

If anything else, that’s a recipe for, how do you get your employees to be loyal? You have to take care of them, and they will take care of you. You’ve told us the story of how you started and what happened when the pandemic hit and how you responded to that. Would you care to share what do you see in the near future for ONLC Training Centers?

Andy Williamson: To comment on something that you said about, related to the employees and sharing the state of the business, we actually did for, oh, I think it’s been at least 25 years now, we’ve been doing something called the great game of business, where every month we share the financial state of the company with the employees. When we’ve gone through other downturns in the business cycle, everyone could see it.

So far this year, we get to see how much money we’re losing each month and what our plans are for turning the corner. That also gets everyone invested, and there’s complete disclosure in terms of what the finances are. It keeps everyone on the same page and working in the same direction.

As a result of the things that we’ve done so far, we’ve been able to what they call variabilize our expenses, because of the instructors reducing their costs for low enrollment classes, and the biggest thing being the rent expense. Starting in 2021, our rent expense will be almost half of the cost that it was in the beginning of 2020, and so that will help us.

We did get a substantial PPP loan from the government, and because we have not laid anyone off, we’ll be able to have that loan forgiven. In addition to that, we have a lot of cash on hand as a result of my business partner, Jim Palic’s, business philosophy.

Over the years, whenever we made a little bit of money, or even if we made a lot of money in a year, instead of declaring a huge dividend, we would squirrel a lot of that money away, whether it was just $10,000 or hundreds of thousands of dollars over the years. In the past 15 years, we’ve saved a significant war chest to be able to help us.

I personally never thought we’d be in a business situation where things changed so dramatically in such a short period of time, and some people will term that as a black swan event that you didn’t expect and it was very severe. Between the PPP loan and our significant cash in the bank, that will help us.

I was talking to my son, Gary, a few months ago, who works for Dell and is getting his MBA at night. We were talking about companies like Apple and Microsoft, if they were to hit a downturn, how would they be able to weather it? We looked it up and Apple has $60 billion in sales each year, and they have almost $200 billion in cash on hand. Microsoft is not in as good of a situation, they have $126 billion in sales, and they only have $138 billion in cash.

When the pandemic hit, people would say, and I think you even echoed this earlier, you said, “Well, you’ve been in business a long time, you guys are smart, you’ll figure it out.” That may be true, but to be able to figure it out and pivot, you need time, and we’ve taken some significant actions lately. But to be able to buy that time, you need cash to be able to weather short-term downfalls that may happen over a course of a year or 24 months.

I’m not sure exactly where we’ll land, how much training will be done in training rooms or done online in the future. That’ll be up to the customers to decide, but I’m sure we’ll be playing a significant role in the IT training space for years to come. Thanks to Jim’s foresight, we have the cash to be able to stay in there and get the job done.

Dr. Marie Gould Harper: Great. You have said a number of things and some of the points that I wanted to bring back up. I think you and Jim have the perfect partnership. You balance each other, and just by you telling your story, you have shown over the years how your two different styles have helped anchor the organization.

It’s interesting to have that type of structure, because I think that’s what a lot of the larger businesses miss out on, the diversity of thought between two of the leaders, and then also the trust that has built over time.

It’s not like either one of you have your own career path plan and working individually, you’re working in harmony together. I’m putting my money on you. I think ONLC Training Centers is going to come out. I’m very interested in seeing where you come out at. I think it’s going to be another transformation like the one that you have shared from the time that I worked with you to the pandemic time. Even the time before that, how you decided to, I think, you used to refer to it as, last-man standing. You want talk about that?

Andy Williamson: That might happen here with, it’ll be interesting to see. There’ll be a certain demand for IT training over the next year, but we always talk about the demand facing the firm. If there are fewer players in the market, even if the overall demand goes down, the demand facing our firm might go up, if there are fewer competitors. So we’ll be around, I don’t know about who else will be standing alongside.

Dr. Marie Gould Harper: Okay, I’ve used that expression over the years. You have shared so much information, a lot of how to, and then things what not to do and how to just analyze things about your personal situation in your organization. Are there any other things, little tidbits, you would like to share?

Andy Williamson: Well, the other thing that helps is, what did I say? We’ve been in business for almost 38 years. Many of the people who are part of our core group, who work in the headquarters, have been working with each other for 20, 25, 30 and over 30 years, the core group.

That helps a lot in that we can more easily pivot. Everyone knows their jobs. Everyone knows multiple jobs, and they’ve been with the business a long time. That’s like a little bit of a secret weapon that we have compared to some of our larger competitors. We’ve all worked together for a long time.

Dr. Marie Gould Harper: Andy, I think you’ve shared a lot from your experience with your company. I think you have also shared information that will be of encouragement to individuals, who have been faced with this pandemic, and because their backs have been up against the wall, a number of them are trying to figure out if they should just go out on their own and be that small business owner.

I think you give a sense of hope to people who might want to step out and do that. I think you have provided guidance on some of the things that you should look at, and I’m getting ready to throw this one in. I hope you can come in and teach some of our classes too, just from a leadership perspective. What I call seeing beyond the veil, because you’ve always had good foresight, you and Jim together, looking beyond what’s in front of you to see where you can go.

I want to thank you for sharing your time, your thoughts and your perspectives on ONLC Training Centers. Once again, congratulations on the rewards.

Andy Williamson: Thanks, Marie.

Dr. Marie Gould Harper: We have been speaking with Andy Williamson, CEO of ONLC Training Centers. This is Marie Gould Harper. Thank you for listening to our podcast today.

Dr. Marie Gould Harper is the Dean of the School of Business at American Public University. She holds an undergraduate degree in psychology from Wellesley College, a master’s degree in instructional systems from Pennsylvania State University and a doctorate in business from Capella University. She is a progressive coach, facilitator, writer, strategist, and human resources/organizational development professional with more than 30 years of experience.

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