When Yaniszewski first started her company, she offered clients a vast smorgasbord of administrative services: database management, telephone answering, resume writing, transcription--you name it, her staff did it. "We were trying to do everything for everyone and not doing anything really well," she recalls. It's a common dilemma. "Entrepreneurs tend to be highly reactive and opportunistic, which becomes more of a liability as the company grows," says Goodman. "They tend to be very sales-driven, and that's dangerous because it focuses on revenue instead of profitability." Indeed, Yaniszewski thrived on sales, often landing so many new clients that her tiny staff would beg her to slow down. "It was overwhelming because she would sell so many accounts," says Judy Debay, a transcriptionist who has been with ExecuScribe for 11 years. "You felt like you were doing so many things that your head would spin." Yaniszewski herself "couldn't understand how I could be working so many hours and making no money."
A little outside advice was extraordinarily revealing. "We needed someone to look at the business in a way that we couldn't," recalls Tom Yaniszewski. "And then the light bulb went off." For the bargain price of $2,500, a consultant taught them about core competencies, a concept that would radically change how Yaniszewski ran ExecuScribe. A routine financial analysis revealed that the company excelled at medical transcription work; it was the most profitable service that ExecuScribe offered and the one that generated the most referrals, which lowered the company's overall cost of sales. But transcription services represented only 20% of total revenue. So Yaniszewski took a deep breath and began to slash and burn, essentially "firing" 80% of her customers and eliminating 90% of her services over the next 90 days. It may sound extreme, but Yaniszewski was hewing to her life plan. Rebuilding her business to focus entirely on transcriptions seemed to be her best shot at earning the kind of money that would open the door to the lifestyle she coveted.
The temptation to immediately replace terminated clients with new ones was almost overwhelming. "Even with so much opportunity, we've got to focus on taking on one customer at a time," cautioned Tom. "Let's take on 10 and make it fly," countered Linda. "It's too aggressive," Tom warned. "You can't do it without straining our cash flow and the staff." To which his wife would offer her favorite response: "Just watch me." In the end they compromised, taking on more work than Tom felt comfortable with, but less than Linda would have liked.
In many ways, money was the easier part of the equation. Yaniszewski was a self-described workaholic and micromanager who thought she did everything better than everyone else. But those were exactly the characteristics that kept her tethered to her business. Arriving at home by 7 every night, taking a decent family vacation, not working on weekends--all required that she trust other people to get the job done.
She took her eight employees to an off-site meeting with a facilitator and shared her new vision for ExecuScribe, one in which she would loosen her grip and begin to rely more heavily on her staff. One left, one was fired, and the rest embraced the plan with relish, hoping that the company's new mission would reduce stress for everyone. "We gave permission for people to make mistakes, and that was huge," says Yaniszewski. "Our philosophy became 'try, fail, learn." She gradually began delegating responsibility to others. She gave up managing the night shift, which meant that she would no longer take calls from the company's off-site transcribers, who for the most part worked at home as independent contractors. And she abdicated client services to a new manager who attended to the day-to-day details while she focused on the things that she did best, sales and relationship-building. She created a quality assurance program and hired a trainer for new transcriptionists. Slowly, a new infrastructure began to take shape. Within 18 months, the company's revenue grew 450% and profits increased enough to allow Yaniszewski to add health insurance, plus 401(k), employee assistance, and bonus plans.
To a large extent, Yaniszewski was riding the wave of two powerful trends. In the medical field, greater concern about liability and a growing movement to outsource administrative functions were resulting in a burgeoning need for high-quality, fast, and reliable transcription of patient notes. Signing on new clients was like shooting fish in a barrel. But Yaniszewski had already suffered the terrible consequences of assuming that all customers are created equal. And so she devised a profile of her ideal customer. She wouldn't market to anyone looking for a low-cost provider because she wanted clients willing to pay for quality. Customers impressed by top-quality work were more likely to refer ExecuScribe to others, and more referrals meant lower cost of sales. The company's customers also had to be situated no more than two hours' drive from Rochester, so that Yaniszewski could meet with them face to face on short notice while remaining true to her commitment to spend more time with her family. Finally, they had to be technology-savvy because "we were sick of being everyone's tech guru," she says. By 2000, she had successfully separated the wheat from the chaff; 90% of her clients were large, private physician practices and hospitals who fit her profile; 90% of her business came from referrals. In pursuit of her life goals, she had learned how to become strategic in her business. And it paid off. Between 1997 and 2000, ExecuScribe's revenue grew from $302,000 to $1.3 million, its staff swelled from eight to 14 with 45 contractors, and Yaniszewski got the salary she wanted.
