Skip navigation
2015

SBOM_Credential_body1.jpgIn our latest installment of SBC’s small business spotlight, we meet Steven Smith, chairman of Credential Check Corp., a workforce screening services-company based in Troy, Michigan. In a recent interview with business writer Susan Caminiti, Smith speaks about how the company got started, the role technology played in its early success, and why in business it’s important to keep an open mind.

 

by Susan Caminiti.

 

In his long career as an entrepreneur, Steven Smith has learned not to dismiss those seemingly outlandish ideas that come his way. “When I’m ready to have a visceral reaction to some crazy request or business idea, I’ll stop and think it through first before making a decision,” he says.

 

That strategy has served him well. As chairman of Credential Check Corp., Smith has built his workforce screening services company with deliberate decision-making when it comes to people and ideas. It’s a method that has enabled him to attract nearly 1,000 corporate clients—Fortune 500 companies among them—and post annual revenue of nearly $5 million.

 

SBOM_Credential_body2.jpgIn the mid-1990s, Smith was running several businesses, including Smith Security, a company he founded to provide corporations with uniformed security guards for their headquarters. A local business acquaintance in Ann Arbor, Michigan named Jerry Wright approached him one day with an idea: Would Smith like to buy his security assessment and workplace violence prevention business?

           

Wright’s company was successful, but as an Ann Arbor police sergeant, he had no interest in overseeing the administrative side of his growing business. “When Jerry asked me, my first thought was ‘Why on earth would I want to buy your company?’” Smith recalls. But after his initial resistance, the idea began to make more sense. The businesses were complementary, and the purchase would allow Smith to spread his security company’s substantial IT, legal, and back-office expenses over a greater base of revenue. “Plus, I knew Jerry and had the greatest regard for him,” Smith recalls.

 

The arrangement proved successful and over the next few years the combined businesses flourished. However, it wasn’t until an annual budget meeting in early 1998 that the seeds of Credential Check were actually planted.

 

At the time, databases for pre-employment screening were just beginning to come online. Wright had been doing about 10 background checks a month for different clients, Smith recalls, but the process was slow and involved mainly phone calls to track down the information needed. Wright requested $15,000 to purchase PCs to access the databases electronically.

 

SBOM_Credential_PQ.jpg

“Again, it was another one of those moments when my visceral reaction was to say, ‘No, we have a Unix computer system, we don’t need to spend money on PCs,’ but I listened to him and waited before responding,” Smith says. He eventually approved the purchase and the company that would later be renamed Credential Check, was born. Says Smith: “We didn’t agonize over the name. It says what we do.”

 

Today, the Troy, Michigan-based company does over 10,000 pre-employment background checks a week for clients in a variety of industries including defense, energy, staffing, entertainment, manufacturing, and healthcare. Smith says clients can receive a full report on a potential new hire within 48 hours to 72 hours in an easy-to-read format.

 

“We deal with the human resource professionals who don’t have the time to do the kind of background checks we do,” Smith explains. Depending on the type of job responsibilities involved, Credential Check can do criminal and civil records searches, access consumer credit report and driving records, and arrange for substance abuse testing.

 

Michael Pachuta, who joined the company in 1998 and was named president in 2001, says one of Credential Check’s greatest opportunities for expansion is with a service it offers called CC-Verify. “This service allows clients to manage the training, testing, and validation of suppliers, contractors, and sub-contractors who have routine, yet unescorted, access to their facilities,” he says.

 

SBOM_Credential_Sidebar.jpg

Credential Check’s growth has required additional real estate and technology financing, says Jason Baroni, the company’s Bank of America small business banker (SBB). “Down the road, we can also handle financing for any acquisitions they choose to make,” he says. “Credential Check is a really interesting client because they’re a direct indicator of how much—or how little—hiring is being done in the economy.”

 

Like all growing businesses, Credential Check’s path has not been without its challenges. In 1999, a year after prompting Smith to make the move to electronic databases, Wright suffered a heart attack at age 53 and passed away. “It was a horrible time,” Smith recalls. “Jerry was so young and within a week my wife had me in a cardiologist’s office to have my heart checked.”

 

The profile of the business also changed. Shortly after Wright’s death, Smith decided to sell the uniformed security guards portion of the company. “I realized I wanted to step away from the daily CEO role and this part of the business was the biggest user of my time,” he says.

 

He and Pachuta agreed that the best course of action for Credential Check would be to concentrate on background checks, the part of the business that provides a steady, recurring revenue stream. Pachuta handles the new business development and client relationships, while Smith oversees finance, accounting, and human resources. And although he splits his time between Credential Check’s Michigan headquarters and a home in South Florida, Smith says he and Pachuta typically talk “several times a day.”

 

“The beauty of my role now is that I don’t have to be in the office everyday, but I can communicate with Michael whenever we need to, from wherever I am,” Smith says. “Technology is just unbelievable.”

Video Replay of the Live Google Hangout: Exploring Generational Differences Among Small Businesses Owners

 

 

Welcome to this video replay of the Small Business Social Series sponsored by Bank of America.  The panel discusses the generational differences among U.S. small business owners and what this means for the small business landscape.  This discussion was moderated by Carol Roth.

 

In this video you will hear from:

  • Robb Hilson Small Business Executive,Bank of America
  • Dan Schawbel, Career & Workplace Expert
  • Steve Strauss, Small business columnist, USA Today

Eco-Business_body.jpgby Robert Lerose.

 

According to a 2012 survey co-sponsored by Green America, a provider of sustainable economic solutions, small businesses that offered green products and services reported robust customer growth and strong sales, even as the broader economic recovery stayed sluggish. But you don't have to sell organic products to see an advantage. Adopting green practices within your own operation and empowering your employees to come up with green solutions can raise morale, cut your expenses, enlarge your savings, and hand you a competitive marketing edge when you pursue new customers, as these experts explain. 

 

Assess first

"Ninety-five percent of sustainable projects are either cost neutral or positive in the long term," says Jeana Wirtenberg, CEO of Transitioning to Green, a Montville, New Jersey-based firm that helps companies adopt sustainability practices. "Small businesses are not seeing the tremendous opportunity that is here to engage their employees, to increase their customer base, and to increase their market share."

 

Wirtenberg says that small businesses should start by first doing an assessment to help them figure out where they are, where they want to go, how they can get the best return on their investment, and the changes that are right for their particular circumstances. She suggests focusing on five areas:

 

Facilities: Depending on whether you rent or own your building will help determine ways to make it more energy efficient. For example, updating your windows can cut down on heating and air conditioning costs.

 

Resources: Identify sources of wasted energy and consider shifting to sustainable forms, such as solar or wind. Switching to low-flow toilets can save water. "Is your waste going into a landfill or can you come up with a zero waste plan?" she asks.

 

Eco-Business_PQ.jpgFinances: How much can you afford to invest in changes now? How long can you wait before seeing a return on your investment? "The most important [consideration] for a small business is their profitability," says Wirtenberg. "How do they measure that? What risks do they face? We just saw how superstorm Sandy wiped out a lot of small businesses. As they're rebuilding, are they thinking about the risks from future weather changes? To stay in business and be sustainable, everyone has to find a way to invest in the future."

 

People: Leaders should give more control to their employees to come up with green projects. "It's a way that people will get excited. It ties into the health and wellness of the employees as well as their engagement and satisfaction levels," she says.

 

Supply chain: Take a close look at the companies you buy from to see whether they engage in eco-friendly practices that could help your small business lessen costs and your environmental impact.

 

After the assessment, put together a plan with a timeline. Even modest accomplishments, such as forming a green team within three months to improve recycling procedures, can energize employees. "Sustainability is one area that can bring people together," Wirtenberg says. "Everybody is connected in more ways than they realize."

 

Make the easy changes

Experts say that small businesses should start with easy fixes or so-called "low-hanging fruit" before they tackle more ambitious goals.

 

"Light bulbs are a perfect place to start. It's not all about saving energy, but about having the right kind of light bulbs for the right space," says Alex Kahl, president of Kahl Consultants, a San Rafael, California-based Internet marketing services firm that has been awarded the Green America Business Seal of Approval for its eco-friendly standards. "It's also about maximizing daylight by maybe moving some tables around so that they're closer to windows or having skylights put in."

 

Turning off office equipment at night, putting computers on power saving mode whenever possible, installing high efficiency filters on the faucet heads, hooking up a motion sensor in the bathroom to open and close the lights automatically can save you money quickly. Some improvements may qualify for tax rebates or other incentives—another small windfall.

 

Kahl uses computers, laptops, and printers with high Energy Star ratings, installed solar photovoltaic panels that convert sunlight into electricity, and recycles rigorously. "My expenses have been going down constantly over the last few years based on all the investments I've made. It takes me less money today to run my business than it did five or 10 years ago," he says.

 

Rewarding employees for pursuing green solutions, such as letting them share in the cost savings, can be a strong incentive to keep them motivated. "Even a business that is extremely green will still have a hard time shifting whenever they move from one method to another," Kahl says. "You're going to have to push people to do something, so take it small. Once you reach a plateau and people see the benefits, it's important to let them know how much money they saved the company."


Kahl sees a growing number of consumers making buying decisions based on green factors, so businesses should make them part of their advertising. "You need to promote it and let people know because that's money in the bank."

 

Lean towards green

"I have a colleague who said it very well: 'lean towards green,'" says Yvette Little, owner of Simply Green Solutions, an Ellenton, Florida-based project management services firm with a specialty in green solutions. "So even if you're not doing every green step—if you lean towards green and you start thinking about it, it becomes part of your daily practice."

 

Cutting down on the amount of documents that your office prints, printing on both sides of the paper, or adjusting the margins for a larger print area can have a profound effect over time. For example, Realize Bradenton, a small-sized non-profit economic development organization in Florida, says that their productivity increased by about 20 percent after Little helped them move all their management documents online for easier access and revision.

 

To remind employees of the cost savings between black-and-white and color printing, Little says to put notes on their computer monitors with the actual prices. Conducting a meeting via a service like Skype can dramatically reduce travel, time, and energy resources.

 

Being green can take many forms beyond recycling or sustainable energy solutions. For example, Little works with many non-profits and arranges for for-profit companies to donate their leftover supplies or spare equipment. "It's a great marketing tool for for-profit businesses to be linked with non-profits and with causes they believe in," Little says. "It gives more credence and credibility to both partners."

Filter Article

By tag: