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Selling Services Globally
You don't have to be a manufacturer — or a big company — to export successfully. Three small Connecticut service businesses show why — and how
Service industries have become an engine of growth for the U.S. — and, increasingly, the Connecticut — economy. Companies engaged in every type of commercial activity — manufacturing, transportation, education, retail and wholesale trade, finance and government — rely on the edge that service firms offer to be an integral part of their own business success.
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Business New Haven
4/5/1999
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According to Peter Gioia, an economist with the Connecticut Business & Industry Association (CBIA), a service is a value delivered to a client that is not manufactured, made, mined or constructed. Examples include trade, retail and wholesale, financial, government, entertainment, travel and tourism.
Gioia explains that, according to the latest figures from the U.S. Department of Commerce's Bureau of Economic Analysis, Connecticut's GNP value for 1998 was $124 billion; 70.2 percent of that was generated in services.
While economic well-being will always be closely linked to the efficient production and trade of goods, the productivity, application, and use of information and other business services are similarly critical factors. Advances in technology have rapidly expanded other developments in trade sectors such as financial services and database management, and have fostered the growth of specialized business services with their ability to reach large geographic distances.
Many Connecticut firms have taken advantage of these advancements to develop markets for their services beyond the state's borders.
Interactive FrameWorks Inc. of Madison designs and develops integrated media projects that combine the reach of television, radio and print with the power of the Internet. Since establishing the company in 1991, Andrée and Will Duggan have concentrated on using new networking approaches and technologies to extend the reach and impact of documentary and public-affairs television.
The co-founders have a common background in television news, documentary film production and strategic corporate communications. “We think of ourselves as inventing a new breed of interactive producer,” says IFI's vice president and projects director, Andrée Duggan.
Duggan says IFI's clients typically find out about the company through word of mouth. In its short history IFI has worked with such companies as AT&T, the Charles Stewart Mott Foundation, the Christian Science Monitor, Pratt & Whitney and the Kennedy Center for the Performing Arts.
IFI recently was awarded a grant from the Nathan Cummings Foundation in New York to develop Y2K Week, a series of eight half-hour news and information programs to air nationally on public television and public radio with interactive Web site support.
“With this new media where you have all these different elements - television, Web, print and educational outreach - what we'll do is coordinate with the different people involved, the Web resources, the print resources and so forth,” explains Duggan. “Proposals have been presented to some corporations already, and we'll see if we can partner with a few sponsors.”
Interactive FrameWorks played a key role in several Discovery Channel initiatives from 1993 through 1996 which explored the convergence of television and the Internet. The resulting pilots included The Promised Land (with Nicholas Lehman), China: Building Cultural Bridges and Harlem Diaries. Students from a number of schools were sent materials and used them with the television show and the Web site.
In 1997, working with Grey Advertising and Varied Directions International, IFI created and implemented “You Can Soar,” a multi-disciplinary media and educational outreach project featuring Texas pilot Linda Finch in her 1997 aerial circumnavigation of the globe. Interactive FrameWorks work with several strategic partners like NASA (with a geomap service), Naval Meteorologists (which provided real-time weather forecasts during the flight), and COMSAT (which provided the equipment to track the aviatrix live).
Students across the country could be not only exchange e-mail with Finch but also shared their writings and drawings with other schools via the Internet. “It was exciting for us to do this project,” Duggan says. “One thing just led to another. We got some of our technical people together and they talked to some of their friends - and little by little we figured it out.
“That's what's exciting about this period in history,” Duggan adds, “with technology, it's really like a big playground out there for the people involved in this industry.” Duggan says that depending on the client and the type of project, IFI will come up with the specific interactive media elements that will be put together, and then coordinate the network of partners needed to put the project together.
ESC Inc. is an Old Saybrook firm specializing in electronic design and manufacturing support services for state-of-the-art electronics-based products. These services include system design, printed circuit board design, custom integrated circuit design, testing, and repair service.
“We're in the higher-cost, low-volume market,” explains ESC principal George Martin. “We're not mass-producing anything; we design the prototypes and the client can take it and mass-produce them.”
Martin has been working in electronic engineering since 1969 when he graduated from the Chicago Institute of Technology and took his first job out of college at Hamilton Standard in Windsor Locks. He founded ESC Inc. when he left Hamilton Standard after five years there.
Over the years ESC has designed embedded electronics that are installed as part of a larger computerized system. Blood-cell counters, respirators, simulators for utility companies are examples of equipment developed using ESC's electronic services.
ESC engineers create their designs from a rough outline or from formal design specifications given to them by their clients. “One of our clients from Arizona had us do design work for a radio direction finder, like what they have in the James Bond movies (where there's a little red light moving across the screen),” Martin says. The client, a retiree from Honeywell and the U.S. Department of Defense, then sold the finished product in Europe, where they're used to track criminals.
“He had all the antennas and all the receiver units, and he knew what he wanted the computer to do,” Martin explains. “We wrote the program that would have the computer chips control the analog and direct the signals.”
Another design project was for a “distinctive ringing unit, allowing users to have one phone line coming into their house and have up to four numbers using the single line. Martin explains that it's available in Connecticut (known commercially as Star Ring); each number activates a different ring and can be routed to different phones. Martin says the client ESC did this work for sells these units to SNET and US West.
In 1997 ESC did design work for an electronic biomechanical forceplate for a scientist at the University of Brussels. It's similar to an extra large bathroom scale, but this one measures the force exerted by an object in six axis directions and then graphically simulates how the object is moving across the forceplate.
Martin explains that children with muscular dystrophy might be monitored by this device after they had treatment and the doctors were able to determine whether the treatment was working.
Martin explained that most of his clients find out about him through word of mouth. “In the beginning we had to advertise; now we don't have to,” he says. “I do the same thing. If someone wants to know where printed circuits are made, I'll tell them who I know.”
Branford-based Lexitech designs a myriad of software systems to support self-service kiosks in public and corporate locations. Lexitech President Alexander Richardson founded his company in the basement of the Yale School of Management in 1983, while a second-year student there.
Lexitech has been instrumental in the design and development of interactive Information Technology (IT) services, particularly new media self-service applications, since the industry's infancy. Today its core business is the creation of custom software for Internet e-commerce and corporate e-news applications, predominately for enterprises that employ self-service Web terminals.
Many self-standing computer terminals, or kiosks, running Lexitech's interactive software have been seen everywhere from the Special Olympics World Games in New Haven to the United Nations World Summit on Trade Efficiency to locations for the Hurricane Andrew relief efforts. The software allows the kiosk to operate like a limited-access Web browser (limited to those Web sites chosen to be part of the content available to the viewer), and uses a touchscreen system permitting any user to access information regardless of his level of computer literacy.
This interactive software has been designed and installed in a variety of client applications including trade shows, conferences, state job centers, municipal public information centers, and retail point-of-sale locations. Lexitech specializes in creating business-to-business applications within the technology, insurance, automotive, health-care, retail and government sectors.
“We have our software running at places like the Kennedy Center, NASA, the Rock 'n' Roll Hall of Fame, the U.S. Office of Personnel Management in
Washington, D.C., and Audi in Germany,” Richardson says. “It really makes a small company a global company.”
Microsoft uses Lexitech's software in its “virtual recruiter” kiosks in the lobby of its Redmond, Wash., recruiting center. Job applicants can touch-screen different choices and be shown what it's like to work for Microsoft and live in the greater Seattle area.
Microsoft also selected Lexitech to provide interactive software for self-service kiosks it uses at trade shows to present key content information and generate leads.
Richardson points out that designing this type of software allows a company to analyze the leads it generates at trade shows and conferences, and can see how effective its presentations are and rationalize its trade show and conference expenses. Along with providing information to the viewer, the software provides a record of what specific information people visiting the booth were most interested in obtaining.
Another Lexitech client, Fidelity Investments, uses Lexitech software to operate a branch office in San Francisco. Customers can make transactions, open new accounts, check their portfolios and surf the Fidelity.com Web site at 12 self-service kiosk stations.
Each particular software application is customized with regard to what information is to be shared with the viewer and the choice of distribution, whether a kiosk, point-of-sale terminal, Internet-enabled telephone or networked PCs.
For example, employees at companies like AlliedSignal have found detailed human-resources information via a custom-made intranet system. Hong Kong residents can browse Web-based yellow pages while making pay-phone calls. Customers at Ritz Camera and Wal-Mart can get instant photo enlargements at the Fuji Film Alladin Workstation co-developed by Lexitech.
“Besides finding opportunities outside of Connecticut,” Richardson explains, “what's important for small Connecticut companies is how to get access to the larger or bigger companies here, from companies like GE to the Travelers to Black & Decker.
“There are opportunities here, too,” he notes.
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