One CEO speaks on the stagnation of remaining in one industry.
Ze'ev Drori has a tough act to follow -- his own. In 1969, Drori founded Monolithic Memories Inc., a semiconductor firm that grew to sales of $250 million before it was sold to a competitor last year. Now, he's at it again, as chairman and CEO of Clifford Electronics Inc., a small manufacturer of car security systems. What's a Silicon Valley multimillionaire doing with a car accessories business? In Drori's case, having fun. "I enjoy it as much, possibly more, than anything I ever did in Silicon Valley," he says. "It really is exciting.'
Time was when Drori found the car security business exasperating. In 1979, he was CEO of Monolithic Memories, driving a Porsche equipped with a car alarm that was no Clifford -- and no match for the thief who broke in. On the advice of friends, he located a Clifford alarm, which worked fine for two years before needing a minor repair. Drori then spent weeks trying to locate the manufacturer, which was keeping a low profile in Sun Valley, Calif. "It was like an illicit thing," he recalls. "Their idea of selling was selling to just a few people in L.A.'
Determined to change that, Drori invested in the tiny company, acquiring it outright in 1983. Two years later, his appointed president came to him wanting to buy Clifford or leave. Drori, who had given up day-to-day responsibilities at Monolithic Memories, decided that he himself would become full-time president of the $7-million car alarm company.
It was a tough adjustment, Drori admits, accustomed as he was to the power, prestige, and staff of a much larger business. Nevertheless, he weathered the transition well. He says Clifford has been consistently profitable, and sales have grown from $550,000 in 1981 to a much bigger number he won't divulge. Its major competitor is publicly owned Code-Alarm Inc., with 1987 sales of $13 million and projections of $22 million this year. Code-Alarm CEO Rand Mueller estimates Clifford will do about $16 million this year.
Part of Clifford's success, says Mueller, stems from the company's high-technology image, which Drori has cultivated with such features as remote-control door unlocking, programmable sirens, and window sensors that recognize the sound of glass breaking. The next step? Both Drori and Mueller plan to diversify into home security, anticipating a decision by American carmakers to install alarms as a standard feature.
Drori will have to move quickly. "No chief executive, no manager, should be in his job more than seven years," he says firmly. "It really leads to stagnation." By that rule, he has until 1992 to relinquish his CEO title. Then the two-time entrepreneur, now in his late forties, expects to acquire other companies. Beyond that, he isn't saying.