Reprogrammed Approach
Nien-Ling Wacker, a native of Shanghai, came to the United States as a physicist in 1968 and began learning the fledgling computer industry. During the 1970s, while raising her two sons, she developed custom software at home for select clients. By the late 1980s, Wacker sold both computer hardware and software, but she soon found herself confronting a difficult question: Why was it that her company never had enough money and her employees never had enough time for their real specialty--computer programming? Wacker was interviewed by Karen E. Klein.
In the early 1990s, I was having dinner with a gentleman and we started talking about how computer companies seemed to always be losing money. I told him I kept putting money into my company but never had enough cash.
He asked me what my grandfather did and I told him my grandfather was a tailor in China. His grandfather had been a businessman. “You know,” he told me, “in our grandfathers’ day, they went into business to make a profit. Nowadays, we’re constantly trying to get a bigger share of the market, but we’re always losing money.”
It was like a lightbulb went on over my head. My grandfather was right! I realized I could not keep pouring money into a business that was not profitable.
It was that conversation that started a period of soul-searching. One thing I realized was that as I traveled around the country selling my products, I was always lugging the hardware with me--PCs, scanners, CD-ROMs--and every time I was on site with a potential customer, I saw scanners, printers and PCs everywhere.
I knew that my customers could buy hardware much cheaper than I could sell it, and I was making only a small margin anyway. Plus, all my valuable cash was tied up in inventory.
So we decided to abandon our hardware line. I have a nimble, intelligent team of employees who really understand the software business, so we concentrated on developing software that our clients could use with their existing hardware.
Another thing we did was focus on a more narrow slice of the market. The software we sell is for managing records and reducing paper. We knew everyone could use it, but who really needed our product?
We put a priority on selling to records managers, especially those in the public sector who are facing reduced budgets and increased demands for information. If you have hundreds of thousands or millions of pages to keep track of, our product comes to the rescue.
We began to focus on applications for cities, police departments and school districts. As one agency bought our system and installed it, we leveraged their success stories to the next agency, from one city to another city, from one school district to another. When we told them they could keep their PCs and still use our software, it became much more affordable for them.
In the past three years, the business has completely turned around and become profitable again. We want to have a piece of the pie, but we realized we can’t have the whole pie. Hopefully, the pie is growing and, with our strength in this area, we can outsell our competitors.
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Bio Box
Company: Compulink Management Center Inc.
Owner: Nien-Ling Wacker
Nature of business: LaserFiche document imaging
Location: Torrance
Founded: 1987
Employees: 40
Annual sales: $3.5 million
