His next attempt, General Products Systems, had an equally short life. Looking to squeeze more revenues from his core business, Tjelmeland added a division that would sell a line of proprietary roofing materials. But selling a tangible product, he found, bore little resemblance to peddling a service. "How am I supposed to distinguish myself?" he once asked his accountant. "Hmmm," came the reply, "ever done any advertising?" Almost immediately he went out and plunked down $12,000 to lease a billboard above the Cedar Rapids police station. In coming up with the uncluttered design -- which touted both the new division and T&K -- he consulted with several friends, among them Scott Appleget.
Appleget had gone to high school with Kurt, the oldest of Tjelmeland's three children. Now he was about to graduate from the University of Northern Iowa, where he had studied public relations and marketing. What are your plans? Tjelmeland asked. Appleget wasn't sure. How about helping me get this thing off the ground? Appleget was soon designing brochures and writing PR copy.
Tjelmeland's preoccupation with the roofing products was coming at the expense of his installation business. He wasn't out selling jobs as much as he had been. His beloved monthly statements revealed that volume was dropping. Since the early 1980s revenues had flapped as wildly as scaffolding in a gale. Down to $700,000, up to $1 million, back down to $800,000. By 1985 sales had shriveled to less than $500,000. Worse, "there was a little bit of red ink," he admits. The billboard brought in business, but Tjelmeland also heard some disturbing comments. "Hey," someone would say, nudging him, "until I saw your billboard, I thought you guys were out of business."
The company's deterioration had less to do with Tjelmeland's realization that he was spreading his management time too thin than with changes in the industry. While he was tinkering distractedly, his business was losing its footing.
Understanding the transformation at hand meant going back to the mid-1970s, during what may soon be known as the First Energy Crisis. To keep heat inside, companies stuffed their buildings with insulation, exposing their roofs to harsh temperature shocks. The then-popular built-up roofs (BURs) consisted of three to five plies, a gooey layer cake of asphalt and roofing felts. Inflexible, the roofs began to suffer thermal fractures, causing leaks. As interest rates soared to withering heights in the early 1980s, manufacturers sought cheaper, more reliable alternatives.
Single-ply rubber roofs answered the call. Aside from their recession-friendly price tag, they were also a cinch to install. Who needed tar kettles, hoisting equipment, or pumping gear? Aspiring roofers simply got their hands on a paintbrush, a screwdriver, an extension cord, and a ladder. To get the job done, all they had to do was roll open a big sheet of rubber, stretch it across the roof, and seal the seams together. "A lot of those guys didn't know anything about the business," charges Tjelmeland, "but they could squeak by for five years."
Before underbidding themselves out of existence or getting kiboshed by unanticipated warranty claims, newcomers inflicted a lot of damage on T&K. At many a prebid meeting, Tjelmeland suddenly found himself as much as 25% above the lowest bid. "It was getting tougher and tougher to sell against these renegades," he concedes.
Fortunately, he sought out some guidance by attending a local workshop called Marketing in Tough Times. Brimming with new ideas, he began focusing on the possibility that the company might need a new image. Appleget agreed, substituting a fancy college word: positioning.
T&K's curse, Appleget argued, was that it had no distinctive selling point. The companies he had studied in college, such as IBM and Procter & Gamble, all stood for something and prided themselves on consistency. Consumers came to them with certain expectations. To the extent those expectations were met, they felt satisfied and came back again. T&K knew nothing about what its customers wanted. Indeed, it hardly ever spoke to them. T&K might install your company's roof, and you would never see the workers again. The company didn't project consistency, either; some of its trucks didn't even have T&K's name on them. "Nobody thought much about it," Tjelmeland says with a shrug.
In an odd way, the industry was ready for him. As competition grew keener, T&K would need the kind of skills that Tjelmeland had been developing through his outside ventures. At Data Management, for instance, he had perfected his ability to acquire and use timely information. And GP Systems had introduced him to the concept of marketing. Finally, Tjelmeland, for the first time since he had founded T&K, had a trustworthy management team in place. "It's a shame that I had to grow my own managers, but I did," he confesses. "In a day-to-day operational mode, I go to pieces." In addition to Appleget, son Kurt, then a recent law-school graduate, signed on as chief operating officer and corporate counsel in April 1987. (A younger son, Kreg, served as production manager until last July.)
It wasn't long before Tom decided to shelve GP Systems and rechannel his energies into the roofing business. "The roofing business could exist without GP Systems but not vice versa," says Kurt, now 28. Clearly, the company needed Tom's attention. Sifting through building permits, he could see that T&K, which once had performed 55% of the area's jobs, was now down to roughly 35%. "I saw there was business out there," says Tom, "and we had to get it."
How? Quite honestly, he didn't know. Nor did he pretend he had the energy to carry it out himself. "I was a kid when I started this," Tom says. "Youth is fun. I figure that if I can't go back to being 20, why not enable a couple of young men to lead interesting lives? Why not let the company benefit from their excitement?" He was giving his managers a mandate to remake T&K "with a modern image."
They would not disappoint him.
* * *
Tom Tjelmeland founded T&K when he was just 20 years old. He had started working at age 14, dragging buckets of mortar around construction sites. "I never had much formal education," he says.
