Building a Business Legacy

According to a SBA report, about two-thirds of small businesses (with employees) will survive two years.  After five years, business survivability drops to nearly half.  In Detroit, it seems new businesses are popping up weekly and the challenge centers around business growth and sustainability.

Simply put, how does a new or existing business achieve longevity?

Meet 88-year old, KLA Laboratories.

Established in 1929, Dearborn-based and family-owned KLA Laboratories, Inc. provides turn-key solutions for networks, premise cabling, in-building wireless systems, video and sound system installations. It also offers audiovisual installation and event production for events of all sizes including corporate presentations and festivals.  In fact, if you’re attending and enjoying free music through your mobile technology at various summer festivals or enjoying free Wi-Fi on their phones at The Palace of Auburn Hills, Ford Field, or at Comerica Park, et. al., chances are the system has been constructed and installed by KLA Laboratories for your listening pleasure.

Pat O’Bryan, who worked for the founders in 1947, purchased controlling shares of the company and assumed ownership in 1964.  It has remained a family business and is now under the leadership of his son, Matt, who currently serves as President & CEO.

Today, KLA Laboratories employs 175 employees and is expected to reach $40 million in revenue 2017.  Since its inception, the company has evolved and now offers turn-key solutions for networks, premise cabling, in-building wireless systems, video and additionally, offers audiovisual installation and event production for events of all sizes including corporate presentations and festivals.

I recently talked to O’Bryan about the company and its ability to remain relevant in an ever-changing, competitive marketplace.

Lee:  KLA Laboratories, Inc. is nearly 88 years old.  How has KLA Laboratories technology evolved since the installation of microphones and speakers in 1929 to the advanced communication technology that it provides to clients today?

O’Bryan:  The company was about 75 years-old when I took a leadership role, and my assessment was that they had been doing something right for a very long time as KLA had been on a growth trajectory. Working with my father and other experienced engineers and the more creative guys, I thought if we followed their model it was going to work. What we had to do was look for new areas and new services to provide our customers because the economy was really tightening up. So, we looked to expand our services to our existing clients. We weren’t going out and knocking on doors to get new customers, we were trying to be innovative in how we could provide more services to our existing customer base.

Lee:  Business sustainability is a challenge for most businesses.  What have been your keys to success and how have you remained relevant in an ever-changing marketplace?

O’Bryan:  Our motto is making the impossible, possible and we are able to do that with the incredibly creative engineers we have working for us. KLA Laboratories has always sought out employees who can blend the science of engineering with the art of creativity to achieve what most might think is impossible. We have some uniquely gifted people who work for us and some really creative engineers, people who have just the right blend of an engineering and creative mind.

So, for example, a customer may come to us and say they have a situation that needs to get wireless connectivity from point A to point B, or need to get cabling from this part of the building to another, but it’s impossible to get it there. That’s when our engineers go to work building a unique way to creatively solve our client’s problem. There’s a great example at Ford Field that we are working on.  They are doing all the stadium upgrades right now and wanted Wi-Fi in the bowl area, so that everybody in the stands can be on their Wi-Fi system. The unique issue is that Ford Field was built underground, so we had to get cabling up the aisles and up into the hand rails that go down the aisles. We ended up using directional boring to get wires there, a process you might typically associate with being used to install underground pipe, conduit or cables along freeways.

Lee:  And with so many businesses were failing/struggling during and post 2008, how did you keep the company innovative?

O’Bryan:  We saw the Great Recession as an opportunity to reinvent the company that was founded on the eve of the Great Depression. This period in history followed a long pattern set before my time at the company of keeping an eye on the future, established by those who came before me. Our market was shrinking and we needed to be more aggressive to grow. It was a pivotal time for KLA.  We began designing and building wireless local area networks and developed our expertise in distributed antenna systems. Our DAS capability allowed us to now eliminate the need for our clients to have costly antennas and we could then expand our sales beyond just supplying the cabling, into also providing the engineering and hardware. Expanding our verticals allowed us to thrive as an advanced technology company in what was a very difficult time for our country’s economy.

Lee:  What advice would you give to those struggling with business sustainability?

O’Bryan:  My advice to those who are struggling with sustainability would be one word–Patience.  It can be an incredibly frustrating time but patience and persistence to succeed will go a long way to achieving success.  Often times, success may become apparent in a different way than you envisioned.  As part of the learning process and you have to adjust to that and modify your goals accordingly.

Lee:  The company has completed more than 500 Distributed Antenna System installations in the United States, Canada and Mexico.  How has KLA Laboratories wireless capabilities differentiated itself from competitors?

O’Bryan:  Major sports and entertainment arenas have presented KLA Laboratories with a strategic business opportunity to grow the unique KLA Laboratories DAS and wireless capabilities. Older arenas often require DAS and wireless network updates and new venues look to deploy state-of-the-art systems, providing KLA Laboratories an opportunity to add enhanced network capacity that allows major venues to tailor their signal to meet coverage and capacity needs. Often, KLA Laboratories has been able to provide extraordinary solutions for clients who have what may seem to be an impossible problem. From the design, engineering, the cabling, the electrical, the commissioning, all the installation talent it takes to install the system, our clients make one phone call and they call us, whereas others would have to subcontract areas out. 

Lee:  Your business strategy actively engages entertainment venues in Detroit and beyond and in fact, KLA has had at least one employee at every Detroit Tigers home game since 1935 to run the sound system.  What role do these venues play in your business model and will they continue to do so in the future?

O’Bryan:  Our work with venues has expanded, obviously with our more recent technology capabilities like distributed antennae systems. Currently, we are in Little Caesars Arena installing wireless and the network, in Ford Field with wireless, network and the DAS system. We’ve already completed Comerica Park, and we have had full-time people at every Tiger home game all the way back to the days of Tiger Stadium. I’ve done just about every job you can in the company, and I worked nine seasons at Tiger Stadium running audio starting in 1987, a great year for the Tigers and a lot of fun for me.

Lee:  Have you ever had thoughts of selling this business? 

O’Bryan:  I get offers to sell the business quite regularly. We work with a lot of integration companies, so they’ll come in and say, Hey, are you interested in talking about the possibility of selling?  My response is always, No, I’ m not interested.  It’s the legacy, it’s my family, it’s my home, it’s my job and I love it. And, I want everybody in the company to love where they work and be proud of it. So, if I sold out it would really be selling out my legacy and my whole family’s legacy would change.