The Big Time
Although Ban-Koe Companies is the nation's largest Kronos dealer, the company is much more than a time and attendance VAR. Its $19 million revenue comes from a multigroup structure and a focus on hand geometry technology.
In 1999, when the employees of Ban-Koe Companies (Minneapolis) moved into their new Peoria, IL office building, they found something…well, unusual. In addition to an excessive number of very old phone lines, the century-old brick building had numerous nooks containing hidden walk-in safes. Ban-Koe later discovered that the building had allegedly housed whiskey stills and gambling operations run by Al Capone.
But running an office out of an ex-mobster's lair is just one of Ban-Koe's unusual qualities. For instance, how many $19 million time and attendance VARs do you know? Furthermore, how many time and attendance VARs do you know that also sell POS (point of sale) equipment and CRM (customer relationship management) software? Finally, why would a time and attendance VAR be selling products such as fire alarms and wall clocks?
Eliminating Competition With Cross Group Selling
Obviously, Ban-Koe is more than just a time and attendance VAR – despite the fact that the company is the nation's largest Kronos dealer. Today, cross group selling is Ban-Koe's battle cry, and leading the charge is President/CEO Bill Bangtson. Along with his now retired partner Bill Koenig (the "Koe" in Ban-Koe), Bangtson created this "total solution" concept that is the foundation of the company's growth. However, to fully understand the breadth of Bangtson's plan, you have to understand how he has structured the company. The following are the six groups that comprise Ban-Koe Companies:
- Time Group – time clocks, data collection, labor reporting, and shop floor control systems
- Solutions Group – network configuration/administration, custom software, database management
- Business Applications Group – management, planning, and control applications such as Comshare budgeting, reporting, and consolidation software
- POS Group – back office and front counter equipment as well as software from Digital Dining, Biztracker, Cap Automation, and Uniwell
- ID America Group – card printing, digital imaging, badge management systems and supplies
- Systems Group – fire alarms, wall clocks, communication systems, sound reinforcements
Bangtson and Koenig had worked together at Simplex (Westminster, MA), which provides solutions for fire detection, security, building communications, and time and attendance. Their expertise in those areas is what created Ban-Koe's Time and Systems Groups. According to Bangtson, the other groups evolved naturally over the years due to customers' needs. "After we would install a time and attendance system, for example, our customers would ask whom they should contact for applications to feed the data into," he explained. "Instead of sending this business elsewhere, we increased profits by expanding our products and services." By adding the Solutions Group, Business Applications Group, POS Group, and ID America Group, Ban-Koe doubles and sometimes triples its average project revenue. The company's newest additions, the ID America and POS Groups, together account for nearly $3 million of Ban-Koe's annual revenue. And, although every group is rarely involved with a project, the cross group selling concept makes future sales calls much easier. "It's the difference between making a ‘warm' call and a ‘cold' call. In the former, the client already knows our company from its experience with another one of our groups," Bangtson explained.
Biometrics Adds $2 Million In Revenue
Most of Ban-Koe's projects revolve around one data entry point of contact – such as a time clock. Each project then evolves outward from that single point. In the past five years, Ban-Koe customers such as Anderson Windows, Spartan Stores, and Sun Chemicals have chosen a biometric solution as this point of contact. In particular, these companies have installed Recognition Systems, Inc. (RSI) (Campbell, CA) HandPunch terminals (see sidebar on page 102).
The ability to eliminate buddy punching and time cards/badges is the key selling point of any biometric time and attendance solution. So why did Ban-Koe choose hand geometry over other biometrics? Simply put – acceptance. "People are fearful of some biometrics," Bangtson said. "They think either the technology can harm them (e.g. iris scanning) or that the data will be used for the wrong purposes (e.g. fingerprinting). For some reason, hand geometry isn't perceived either way."
This positive perception of the technology is what Bangtson refers to as "soft" ROI (return on investment). Another example of soft ROI is the ability of a system to help management make more informed decisions. Ban-Koe wanted to add more of this type of ROI to all of its biometric solutions. Therefore, HandComm® software was born. HandComm expands the capabilities of the standard time and attendance software provided with a HandPunch terminal. For example, the program offers labor-level transfer and workflow capabilities. It can also send e-mail alerts to the system manager if something goes wrong with the RSI terminal. Ban-Koe now sells HandComm with every HandPunch system. Bangtson estimates that his company earns $2 million in sales from projects involving RSI products. "All of our calculations and experience show that biometric technologies are a rapid growth area for us," he said.
Education Offers Big Growth
Ban-Koe's total solution concept also helps sell more HandReader terminals. For example, the company's Systems Group may be contracted to install a fire alarm system and wall clocks at a newly constructed school. The Time Group could then also suggest a time and attendance system using HandReader terminals. That would enable the POS and Solutions Groups to recommend more terminals for use in access control and debit programs for the cafeteria.
"Education is a big new market for us," stated Bangtson. "Not only are more schools being built, but older schools are being retrofitted. The increase in school violence has also prompted a need for more advanced security technologies like classroom listening systems and access control."
Profiting From IT Staff Cutbacks
Biometrics and education aren't the only growth opportunities Bangtson foresees in the future. Because of the trend in business to cut back on IT staffs, he expects the Solutions Group will become involved in more upcoming projects. "Frequently, clients have been asking us to assume the role of the system manager," he explained. "In the past, this job was usually done by an employee at the company." Bangtson also predicts the Solutions Group will be busy with the ground swell of interest in Ethernet connectivity. Currently 90% of Ban-Koe's clients seek this service.
Bangtson is also not immune to the excitement created by the ASP (application service provider) movement. Although his company does not yet offer its own ASP service, it does sell a Kronos model. "It seems large companies understand the ASP concept and are embracing it. The small companies don't have enough IT resources, so they are also using ASPs. But it's all the companies in the middle that seem to be sitting on the fence. ASPs might be a trend, but they're certainly not a wave I want to put my surfboard on right now."
Ban-Koe may not be a typical time and attendance VAR, but one thing's for sure – Bangston is adamant about the company being labeled a VAR. "A lot of companies call themselves a VAR, but aren't really adding any value – most of them are just looking in catalogs and supplying products to people. We never could have reached $19 million in sales without value added services."Questions about this article? E-mail the author at DanS@corrypub.com.