Impressive article in today's Star Tribune on one of our new board members:
I especially like the last 2 paragraphs...
Published Monday, November 17, 1997
Youngblood: OneLink working to put tough sledding in the past
Dick Youngblood / Star Tribune
Edie
The way I figure it, little OneLink Communications Inc. could qualify as the poster child for corporate victims of accelerating technological change.
Not that the Eden Prairie company is a goner, but securing the future of the seven-year-old enterprise still promises to involve a bit of scrambling.
It was just two years ago that I introduced you to OneLink and its promising line of interactive telephone software systems, the best known of which was a single-number call-routing system used by Pizza Hut and Domino's to transfer phone orders to the store nearest the caller's location.
The ensuing 24 months have not been kind to the company, however: Its core products have been overrun by technological advances and growing competition and its cumulative losses have doubled to about $6 million.
In the process, OneLink also has changed its name (from MarketLink), replaced its board of directors and chewed through two CEOs. Oh yes, there also was an unfortunate acquisition in July 1996 that lost $300,000 in 14 months and was discontinued in September.
All of which helps explain why the company has embarked on a new business strategy aimed at taking OneLink's experience in extracting information from telephone networks and shaping it into a data package that can be sold to corporate clients.
The strategy is as yet unproven, of course, but key events last week nudged it beyond the realm of pipe dreams: U S West, which bankrolled development of the new product, signed a three-year contract to resell the OneLink service to its business customers.
Though the two principals declined to disclose contract details, OneLink CEO Paul Lidsky did say the deal could double his company's revenues in each of the next three years and lead to its first stream of profits late next year.
Lidsky, a veteran of the telecommunications industry who signed on in September as OneLink's third CEO in two years, projected 1997 revenues at nearly $2 million, about half stemming from the U S West transaction. That compares with sales last year of $1.1 million. Now the company figures to peddle its service to the other regional Bell operating companies.
The apparent resurgence comes at the end of a turbulent period for the company. For one thing, its stand-alone call routing systems rapidly were becoming obsolete as new technology allowed the regional Bells -- the so-called Baby Bells -- to upgrade their networks to include call-routing capabilities.
A portion of this business -- perhaps even a growing portion -- is being salvaged by marketing to the Baby Bells the company's expertise at building the precise geographical data bases used in routing telephone calls.
Why the prospect of growth? "The cost of our stand-alone systems [including hardware] made them economically feasible only for large chains such as Pizza Hut," said OneLink cofounder Gred Mohn, the company's vice president of business development. "But the Baby Bells can use their existing networks to sell the service on a per-call basis, which makes it feasible to include companies with only three or four locations. That means a much broader market."
How successfully that market can be developed remains to be seen, however.
Meanwhile, OneLink also had growing problems with its other products, a line of interactive voice response systems sold to Realtors, newspapers and TV stations to make their data bases accessible to callers 24 hours a day. The trouble was, growing competition was transforming the technology into essentially a commodity product, snuffing sales growth and slashing profit margins in the process.
Complicating this scenario was the mid-1996 acquisition of a Roseville company that resold long-distance services via pre-paid debit cards. It might have looked like a booming industry to OneLink's management at the time, "but it didn't fit our business and quickly lost momentum," said Lidsky, who shut down the operation within days after he became CEO.
The question was how to respond to the negative trends. And the answer, it turned out, was with the company's experience at collecting and extracting data from a telphone network and applying Geographic Information Systems (GIS) software used to identify callers and their locations.
"We used this expertise to sell our [call-routing and interactive voice response] services," Lidsky said. "But in the process, we also generated a lot of valuable information about the calls and the callers themselves that generally went unused."
For example, OneLink can tell a client how long it took for each call to be answered, the frequency of busy signals and the length of each call, Lidsky said. This not only gives a company a clear picture of just how adequately staffed and customer-friendly its phone system is, but pinpoints the frequency and location of calls to help it decide, say, the site of a new store or where to target its marketing efforts.
Apply to the location of the caller the related demographic information available from the GIS system -- income, age and education, among hundreds of other variables -- and you've also got a load of exceedingly valuable marketing information.
"It's the kind of data our customers have been seeking for years," said Eric Pflum, a senior manager in U S West's product development operation.
Add it all up and you've got OneLink's new TeleData service, which the company has been developing in partnership with U S West since March.
Given his background, Lidsky would seem to be a logical choice to lead the company's turnaround. In 13 years at Norstan Inc., the Plymouth reseller of telecommunications and videoconferencing equipment, he rose from regional sales and marketing manager to general manager of a regional branch to executive vice president of strategy and business development.
In short, he brings not only experience in business operations, planning and development, Mohn said, "but he fills a void that we've had from the beginning as a company that focused more on technology than sales and marketing."
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