BUILDING A COMPANY WITH A SOUL
Entrepreneurship is part of the American Dream. But even in a stable economy, most start-ups don’t survive. In these lucid times, established companies too are experimenting to find greater resilience and flexibility. The co-founder and CEO of Specified Technologies, Inc., Charbel Tagher, shares some of what he has learned over 30 years nurturing a start-up in the construction industry to its thriving maturity today.
WHAT IN YOUR MIND ACCOUNTS FOR STI’S RISE FROM A 2-PERSON START- UP 30 YEARS AGO TO ONE OF THE MAIN PLAYERS IN THE FIRESTOPPING INDUSTRY TODAY?
In a few words: We always cared more. And we still do.
Jim Stahl Sr. and I started STI intent to make a difference. Thirty years ago, firestopping was an emerging sector of the construction industry. It aimed to save lives, but the practice itself was a bit of an enigma, with little technical clarity, almost no enforcement, few knowledgeable contractors, and products that were solvent-based. You had to wear a mask and gloves to use them, and a five gallon pail of firestop sealant would sell for about $450.
We knew we could do better, and we launched in 1990. Jim was a brilliant engineer who by then had been dabbling with water-based products for close to 20 years and had a good understanding of the nascent firestopping industry. And I brought some relevant management experience: after many years at McKinsey advising companies what to do, I ran a division of a mid-sized company (T&B) that included a microscopic firestopping line. That’s where Jim and I met.
Together, we had a clear goal: to build a company that would make a difference and be different. We envisioned a premier technology company, a thought leader who would help advance the science and art of firestopping. A company that would in time become the preferred choice of the people in our industry: That’s where the check mark in our logo and the words Specified Technologies come from.
We realized that customers would first have to give our tiny start up a shot in the shadow of the giants of the time (3M, GE, Dow Corning, Hilti). And that’s when our caring transformed into committed policy: to make innovative and better products, add value the giants couldn’t or wouldn’t, make it enjoyable for our customers to interact with us, and most important, to continuously improve safety while helping our customers succeed at what they do. We also decided that we would make our products in the USA (I feel a special debt to this country), which we have for 30 years now, even though we export to around 50 countries, including China.
To start with, we patented and introduced a new, safe, and superior technology: the water-based two-stage controlled expansion. It allowed simpler and better solutions that covered a wider range of applications. And we did our best to provide outstanding sales and technical support so that end users had their questions answered very quickly and would get Engineering Judgments by highly qualified personnel. Over the years, to make sure we provided safe and excellent solutions, we tested extensively. We started with 12 UL Systems and if I remember well, 3M, the market leader, had 48 UL Systems. In fact, the whole industry had around 100 UL Systems! I’m proud to say that STI today has around 1,650 UL Systems – more than anyone else by a long shot. We’ve also made it very easy for our customers to pick the right UL systems on our website. And we put powerful search engines in place that allow our engineers to search our databases very efficiently. So, when we provide an Engineering Judgment, we know what we’re talking about. And when we refuse to provide one, it’s for the same reason.
A few years ago, we had an opportunity to hire some wonderful and very talented engineers who wanted to remain in Tulsa and were forced to resign their positions. We had not expected to have such an opportunity and had not budgeted for it. But we did not hesitate to hire them, opened an office in Tulsa, and seamlessly integrated them into our team. Their presence has helped propel our engineering support from great to elite while fulfilling their personal needs.
Another strategic policy choice flowed out of our commitment to caring: To prioritize solutions over sales. We saw that often firestopping problems were just a symptom and that customers needed help addressing problems in a lasting, holistic manner. STI products that were integrated within a practical framework made it easier for them and other industry players to solve their problems with a solution, not just tubes of caulk. The industry’s performance, as well as STI’s, went up with our policy choice. It gave our business a huge head-start with programs such as the Barrier Management Program, EZ-Path, Firestop Locator, and Submittal Builder.
Most importantly, we hired smart people with the right attitude, and invested in them. We did our best to make sure internal and external communications were open, honest, fast, and respectful. Colleagues (and customers!) who feel empowered and valued stay a long time and contribute out sized value to the company and the industry. More than half our people have been with us over 10 years. Most of the senior people have been around more than 15 years. Longevity and continuity have allowed us to develop a strong middle management bench in all disciplines and deeper relationships with customers.
That’s how we could continuously fulfill our purpose to advance the state of the art; create new firestopping segments and products, as we did in Curtain Wall and data cable management; and provide a whole new approach for the healthcare industry. We also realized the importance of sharing our knowledge with the industry, and within a decade or so STI became the “Firestop University,” with programs such as the FIT 1 and 2, which have become the standard of our industry.
But we also did not hesitate to turn to other experts as needed. For example, in 1997, we realized that hospitals needed a holistic approach to solving their firestopping issues. But we were unfamiliar with their nuanced requirements and needed help. So, we turned to top-notch consultants that included Doug Erickson, George Mills and Mike Kuechenmeister. For two years, they taught us the challenges that facility managers confront in hospitals and helped us develop the Barrier Management Program. What started as a thick binder is now a very powerful, cloud-based set of tools extensively used by hospitals.
I would also be remiss not to mention the important contributions of the FCIA and IFC to the firestopping industry. As proud members of both associations, we have worked hand in hand to learn from each other, advance our common interests, and raise the level of firestopping education in the industry.
WHAT DO YOU THINK ARE SOME OF THE KEY DIFFERENTIATING FACTORS WITH YOUR COMPETITORS?
The most important one, which has always sustained everything, is commitment. That’s a very hard one to copy. I think STI stands out in our industry for its continuity of vision and people. Customers and business partners let us know how valuable those relationships are to them and their success. In contrast, big companies change focus and people all the time. That puts the burden back on the customer.
The second most important one is our in-depth knowledge of all aspects of firestopping and ability to turn it into added value. Customers and other industry members rely on us to keep their own performance ahead of the curve in terms of value, fire safety, and productivity. Again, our customers tell us this is a huge differentiating factor. We are careful to continuously build on years of in-house technical research, testing, gleaning insights from the tens of thousands of interactions we have with end-users every year, sharing our knowledge with the industry, and learning by working hand in hand with contractors, designers and facility owners. You can’t build this body of knowledge when you turn over your workforce all the time.
Commitment and continuity—all the rest derives from there.
STI IS OFTEN REFERRED TO AS A “COMPANY WITH A SOUL”. WHAT DO PEOPLE MEAN BY THIS?
Indeed, I’ve heard that from many of our customers, employees and business partners. It is a compliment that’s music to my ears because that’s exactly what Jim Sr. and I wanted to create, and our people live those values to ensure it is so. Basically, we do business by practicing the right attitude and values. We care about people and about safety, and we show it in our consistent actions.
The bottom line is that we do not see our relationship with our employees and business partners (contractors, distributors, suppliers, A&E’s, and AHJ’s) as merely transactional, but as one that includes a spiritual component. People do not live to work, but work to live, and we want our daily interactions to enrich the mind, the pocket and the soul. That’s why we invest in all our relationships. We want our people to feel happy (and stretched) in what they do, proud to be with a company that upholds their principles, and empowered to do their bit to contribute to society. We have always believed that if we do well by our employees, they too will do well by our customers and partners.
This comes at a cost of course, but it’s very much worth it. For example, in 2008, as companies were laying off people during the financial crisis, we made a commitment to our employees that we would move heaven and earth before we let go of anyone doing their job properly. Jim and I took a cut, but no one else had to. By 2012, not only had we not laid off anyone, we had hired 50% more people! We reminded our colleagues in March, when the Covid-19 crisis started, that this commitment continues and that we wanted them to focus on three things: staying safe, keeping their families safe, and taking good care of our customers.
I also want to add that I personally have a particular debt of gratitude to all those who took a risk on us in the early days and helped us become successful. They cared. And they will always have a special place in my heart.
I hope the folks reading this find it useful. And I welcome the opportunity to hear their reflections about the industry we share and care so much about. I can be reached at ctagher@stiirestop.com.