Successful entrepreneur says 'it's all in the people'

March 6, 2009
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For a guy who averages 80 hours of work a week and whose outside interests are sailing, racquetball, traveling, fly fishing and MSU sports, it sounds like a joke when Dan Behm says he and his wife, Barb, are gearing up for their second Scrabble tournament.

"I like my quiet time at home too, believe it or not," said Behm. "With the kids gone, Barb and I love to sit at home and play Scrabble." The couple has been married 26 years.

Behm is president of Open Systems Technologies, which offers IT solutions for companies specializing in health care, finance and insurance, manufacturing and distribution, and enterprise services.

"I have this philosophy to play hard and work hard," said Behm. "When I work, I work pretty much around the clock. But, I also — over the last 15 years — take six to eight weeks off at a time."

For Behm, putting in long hours is nothing new. The eternal entrepreneur, Behm started two technology companies before taking on OST, which was originally a division of G/S Leasing, a computer equipment, parts and supplies company.

The technology industry, however, was a far cry from where Behm started out. After graduating from Grand Haven High School, Behm got a job as a real estate appraiser with the city, where he was mentored by his boss, John Petoskey, the city assessor. Petoskey and his wife were both Michigan State University alums and heavily encouraged Behm to go to college — in particular, to MSU.

"John and his wife really took me under their wing. He really encouraged me to go to college, but while a lot of kids in Grand Haven at that time would've gone to a community college, he strongly encouraged me to go to a four-year college," said Behm. "He had a huge impact on me. People make a huge difference."

With two years of full-time work under his belt and the support of the Petoskeys, Behm enrolled at MSU.

"Nobody in the family had ever gone to college before and my parents were not really encouraging me to go to college," said Behm. "As a matter of fact, when I told my dad that I was going to go to Michigan State, he looked at me and said, 'Why would you want to do that? You've got a great job with the city.'"

At MSU, Behm knew he wanted to study business, but was unsure about what type. Since the economy was tight and jobs were hard to come by, he chose the business education route that was producing the most jobs for graduates: material logistics management.

"Back in '81, '82, '83, the job market was very tight," he said. "Then I heard all the jobs were in MLM. At the time, MLM was rated No. 1 in the country in terms of its program. I didn't know anything about it; I just knew people going into that field were getting jobs."

Company: Open Systems Technologies
Position: President
Age: 49
Birthplace: Grand Haven
Residence: Cascade
Family/Personal: Wife, Barb, of 26 years; three grown children
Community/Business Involvement: Board of directors for the Metro Health Foundation; advisory board for Arrow, an $800 million dollar distributor of HP hardware and software; OST recently sent 20 care packages to GI’s in Iraq.
Biggest Career Break: A combination of experiences: Education from MSU gave him structure and discipline; IBM, business and technology; startups, persistence and determination. “If you look at what it really takes, it’s a lot of hard work and being tenacious and not willing to give up.”

That story is similar to how Behm got his first job after graduation. He had heard that IBM was the best place to work in the world. Even though he wasn't much of a technology buff, he made up his mind to get a job there. He joined IBM in purchasing, the focus of his college major.

In 1986-1987, Behm said he survived what was probably the most difficult year of his professional life: IBM sales school, notorious for weeding out the weak from the strong. The first three months of the year-long process were spent preparing for an exam. Those who failed the exam were escorted back to their rooms and then to the airport to return home.

For those who passed the exam, things didn't get any easier. Behm recalled being berated in front of his class for missing three points out of 20-point sales call. He also recalled spending an entire day in a room where the temperature was between 90 and 100 degrees.

"They said that there was a malfunction with the heating system," said Behm. "I saw one guy come out of the room … and his tie was completely soaked. There wasn't a dry spot on it. His face was literally dripping when he walked out of the room."

Behm survived the year and moved up the IBM ladder. Though he was successful within the company, he had a desire to join a smaller company where he would have more impact. Behm left IBM in 1993 and found himself at a career crossroads.

"I already had 10 years into my career at that point," said Behm. "I thought, 'OK, I've got another 20 years to go. Do I want to stay in technology or do I want to branch out and try something different?'"

The 33-year-old Behm had offers from several technology firms, as well as from a stockbroker and a real estate company. He chose G/S Leasing. His new sales position was 100 percent commission, and Behm had some pre-conceived notions about what it would be like to go from a large corporation to a smaller company.

"You kind of have this false illusion when you leave a big company," he said. "You're coming from a sales position, so you think it's going to be relatively easy, and you also think the company will probably hand some accounts to you and help you through it."

He was wrong.

"What I found was I actually had to go out there and build my own book of business. It was grueling, so I just started pounding the phones."

Behm put a lot of thought into what it would take to become successful and decided that instead of spending all his time making calls to individual customers, it would be better to build a relationship with a large organization that sold to multiple customers. That was when he discovered Crowe Chizek (now Crowe Horwath), a Grand Rapids-based accounting firm. He worked hard to build a relationship with the company, which eventually led to becoming G/S Leasing's No. 1 salesperson for five consecutive years.

During his time at G/S Leasing, Behm created two start-up technology companies. The first dealt with the Internet, and since it was 1993, Behm said it was a little premature. That business flopped, but he took a lot of knowledge away from the experience. He started his next company a year later. He bought large quantities of computers that had been on lease to large businesses, refurbished them and then sold them in smaller quantities.

After a year, the start-up showed some profit, but he had to make a choice — did he want to continue with the business full-time or close it down? One thing he was sure of: He couldn't continue to work both jobs. His start-up company didn't present the intellectual challenge Behm was looking for, so he decided to close it.

G/S Leasing was fully aware of Behm's talent and desire for entrepreneurship.

"They knew all along that I was doing these other business startups, but at the same time, I was their No. 1 salesman and 100 percent commission, so they let me do it," he said. "They finally came and said to me, 'How about you do a start-up for us?' And that's when I started OST, the company I run today."

That was in October 1996; Open Systems Technologies was incorporated in January 1997. The company originally sold computer hardware for Crowe Chizek, which had approached G/S Leasing to do the hardware side, because it only wanted to sell software.

Approximately six years ago, Behm completed an employee buyout and purchased OST from G/S Leasing. Since then, the business has seen astonishing growth.

"We started from nothing. There were two of us: myself and Jim VanderMey (the company's chief technology officer)," said Behm. "Today, there are over 80 of us: 46 employees that are W2 employees, and we've got another about 40 contractors."

After the buyout, the company experienced 30 percent compounded growth each year for the first five years, hitting $33 million in sales in 2008. Behm believes what sets OST apart is the people, which he describes as genuine.

"It's all in the people. We have something we call 'One Percenters.' That means if I take 99 Oracle DBAs (database administrators) and put them in a room with our best Oracle DBA, our guy is the best in the room — hands down. That's true for about 10 or 12 technology areas. We actually have the industry leaders," Behm said.

He noted that many times when you get brilliant minds together in one company, the company can become arrogant. OST tries to be otherwise.

"It's that combination of the genuine with a brilliant technologist that makes us different."

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