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When life gave Joshua Liberman lemons, he didn't just make lemonade. He planted some seeds to grow roots for a whole new business.
Liberman, president of Net Sciences, an Albuquerque, N.M.-based VAR, is in the midst of a radical business transformation of the company following a sharp revenue decline due to the faltering economy.
The recession hit New Mexico later than it did other regions, particularly the construction and architectural design vertical markets, said Liberman. As a result, Net Sciences lost about half its accounts and 40 percent of his revenue in 2010.
"We had a client retention rate of 90 percent for a decade. It just dissolved last year," Liberman said.
The VAR took the downturn to upgrade its own infrastructure, train employees and market a new managed services offering to clients. Liberman himself took a 50-percent pay cut as part of a complete overhaul of Net Sciences, which had saved about a year's worth of profits in the bank to help finance the changes.
"We dug in and pretty much paved a brand new road for us. We changed a lot about the way we work. Thirty to 40 percent of our processes changed and we finally documented changes and procedures with the crew," Liberman said. "We found a way to be more efficient in the way we executed field work. We consolidated jobs. We made the execution of projects a little better. We learned to plan [customers'] emergencies a little better so in the long run there were less emergencies."
Specifically, Net Sciences acquired three new servers, 10 new desktops, as well as a new firewall, an SSL VPN, e-mail security, switch, UPS and equipment rack. All told, the VAR spent about $30,000 on new equipment.
In addition, employees received Sonicwall and Symantec training, Intel server design training, as well as additional Microsoft training, at a cost of about $10,000, not including MDFs from vendors.
"When things were really tough, we decided to spend into the recession. The recession was really a thing that worked out for us. It was not so good for the U.S., but we had planned ahead. We had a saved a lot of cash during the boom years. We had a year's profit [in the bank] and took that money to revamp a lot of processes," Liberman said.
Net Sciences changed processes from marketing to client management to remote service delivery, Liberman said. The company implemented Autotask, GFI Software's remote monitoring and management tool, a hosted VoIP system, redesigned its Web site, doubled its marketing and spent a great deal of time improving the documentation of its processes.
Net Sciences initially tried Level Platforms and Zenith Infotech as its managed services platform but settled on GFI because it was reasonably priced and packaged and offered good support, Liberman said.
Initially, Net Sciences sent out e-mails to its customer base informing them of its migration to a managed services model and asking them to talk about how this would impact each customer on an individual basis.
