Maximizing Time And Attendance

Stromberg LLC predicts a 52% growth rate by staying out of niches and paying close attention to Internet-based time and attendance.
Business Solutions, June 2000 by Nancy Senger

Systems integrator Stromberg LLC doesn’t turn away customers because of size or vertical market. Providing time and attendance and labor management solutions is what Ted Dinkel, company president and CEO, calls a seamless growth path for companies of all sizes. The company has a customer base of more than 7,000 in North America. Stromberg specializes in time and attendance functions, such as job tracking, employee benefit tracking, PC entry, and advanced biometric employee identification terminals. Simply put: If you’re an end user with a need for a time and attendance solution, Stromberg wants to talk to you.

The company has a history dating back almost 100 years in electromechanical time clocks, according to Dinkel. Matthews Ventures acquired Stromberg in 1996, and the “new Stromberg” acquired Jason Data, a software company, in 1998. “We later spun off the electromechanical clocks,” Dinkel explains, “so in essence, we are a stronger Jason Data.” Stromberg’s current business plan calls for a 52% growth from 1999 to 2000.

“Today,” he continues, “we can sell basic time and attendance applications that run on a PC for $299. We also can sell $1 million WAN (wide area network) solutions. I believe we’re the only company that can make this claim in our industry.”

As its client base increases, Stromberg is developing its own channel to handle larger installations across the country. Until about eight months ago, the bulk of its customers were small to mid-sized companies. Today, its customer list includes companies such as Sports Authority, Caterpillar, and Universal Studios. Stromberg’s new enterprise product, Stromberg Time Manager — Enterprise Edition, is aimed at Fortune 1000 companies. This client/server solution is designed for large distributed environments with complex time and attendance management requirements. The system has an emphasis on security, scheduling, and updating capabilities.

Leading The Pack
“We can use leading-edge technologies because of our infrastructure and the strength of the time and attendance technology. For example, we were the first integrator to become a Silver Solutions Provider for Citrix Systems, Inc. We provide customer planning, installation, integration, and support for the Citrix MetaFrame product line.” MetaFrame software provides a method to deploy, manage, and access applications throughout an enterprise. The software lets Stromberg’s customers deploy, manage, and access its Stromberg Time Manager 2.0 and Stromberg Time Manager — Enterprise Edition across the extended enterprise. This can be done regardless of client hardware, operating platform, network connection, or bandwidth.

“Citrix lets our software run on a Mac or UNIX workstation,” Dinkel explains. “Now, a customer can buy one of our solutions to run at all of its locations, even if its operating systems don’t match.”

Dinkel’s next target is the Internet. “E-access allows our customers to punch in and out of work over a browser,” he explains. “It also allows supervisors to edit time cards and other payroll-related activities from their homes if they want. This can be an important function when you take into account the importance of payroll.”

Growing Fast — But Not Fast Enough
Until about 18 months ago, Stromberg achieved what Dinkel calls “solid, moderate growth.” Through its expanding product line and partnerships with companies like Citrix and Microsoft, the company achieved a growth rate of 67% from 1998 to 1999. Stromberg’s only problem right now is a lack of visibility in the market — but Dinkel hopes that will soon be a thing of the past. “When I’m interviewing salespeople from competitive companies,” Dinkel divulges, “they talk about deals that they win and lose. We aren’t even aware of 90% of the deals they are discussing. The good news is that we lose very few deals that we bid on. The challenge we face is getting our name out there and letting people know we are alive. We just received a million-dollar venture capital investment. At least half of that money will go to marketing.” Stromberg plans to attend trade shows, increase its print advertisements, and make improvements to its Web site.

“Since we have a horizontal focus, we find a lot of business through the Internet,” Dinkel explains. “In the last two days, we’ve closed three deals for our new enterprise product. That amounted to about $150,000 in 48 hours. That’s great, considering some of our sales are only $800. Sales like these are why we are looking at a 52% growth rate for 2000. The fact that the economy is still on an upswing isn’t hurting us, either.”

Dinkel doesn’t rule out the possibility of an initial public offering (IPO) at the end of 2000. Increasing company value is the bottom line.

“The investment community isn’t always concerned with huge profitability,” he states. “These people look for explosive growth. I’d rather have a growth rate of 50% to 70% and zero profit. That tells me I’m racing as fast as I can to increase revenue, but at the same time, I’m not bleeding the company dry. We have been making money, so that tells me I should push for more marketing.”

Leverage The Internet
Qualifying return on investment (ROI) in the time and attendance industry isn’t difficult. Automated systems reduce human error and manpower associated with employees entering data. Biometrics can eliminate buddy punching, so one employee can’t have another employee punch him in for work. Software can also track data fields, such as employee benefits and holiday pay.

Dinkel feels the next area of growth will be achieved by leveraging the Internet as much as humanly possible. “When we do anything, the first question asked is, ‘How can we use the Internet?’ Today, we can support customers by simply giving them Web addresses. Then, we are able to log on through their addresses and provide technical support via the Internet. They can see exactly what we are doing, and we can talk to them — all without the cost of a long-distance phone call.”

Keeping On Track With Enterprise Resource Planning
Stromberg’s also able to integrate its time and attendance solutions with enterprise resource planning (ERP) solutions, such as SAP’s R/3. ERP solutions help companies manage the important parts of their businesses. These functions can include product planning, parts purchasing, maintaining inventories, interacting with suppliers, providing customer service, and tracking orders.

“Companies need us to be experts in getting payroll information into the ERP solution in a format they can use,” Dinkel explains. “Our software breaks the information down enough so that we can export it and provide immediate value. Right now, we’re at 80% of where we need to be. As we continue to grow and work with larger companies, we are facing new challenges, like putting database schemas in specific formats. But beyond that, we can say, ‘If you want to maintain employee data in PeopleSoft’s ERP database, the data will automatically be updated in your Stromberg time and attendance database.’”

Stromberg’s new relationship with IDenticard, an access control provider, is related to this integration. Stromberg works with IDenticard to allow employees to clock in as they use their ID cards to gain entrance to a building. This opens the opportunity for integration with bar codes, magnetic stripes, and smart cards. “It’s easier to sell a system when the value-adds are clearly visible,” Dinkel comments.