Customer Interview: Hank Luhring, Founder and CEO of INC 500 company, IssueTrak

Sure we share the same last name, but Hank is uniquely positioned to understand the intrinsic value of SurvivalWare, and is darned good at communicating it.  Hank has been a software entrepreneur most of his adult life, and we have intimate knowledge of each other’s product offerings and businesses.  I serve on his board of directors, and have been using SurvivalWare on his behalf for years to keep an eye on his finances.  (Of course lately it means I’ve just been drooling over his cash position and lack of indebtedness!)

Hank has been an informal advisor of mine since I was 2.  I’ve always enjoyed having an older brother who was close in age (he’s 19 months older).   We still manage to have great fun together exploring the latest technology, or comiserating about our oldest kids (just wanted to see if they read my blog..)

I really appreciate all the help Hank and his wonderful people at IssueTrak have provided to me – financially, technologically, and otherwise.  I use his product, and expect it to have the same positive impact on my company as SurvivalWare has had on his.  If you need a way to track issues – such as  support calls in a help desk environmet, or customer complaints - why not go with the best.  Check out their website at www.issuetrak.com

Some excerpts:

“You know, there’s the product and then there’s the company behind the product and the product is great.  But, the reason why the product is great is because Rusty has had an unbelievable amount of experience in analyzing financial data for all kinds of companies.”

 

Interview with Mr. Hank Luhring

February 8, 2010 – 3:30 pm ET

Ms. Kelly Luhring:  Why don’t we start talking about your company and your specific role in the company?

Mr. Hank Luhring:  The company is IssueTrak and that’s I-S-S-U-E-T-R-A-K and the “T” is capital and there’s no “C” and we are a software company.  We’re about $5 million in sales and we sell a software package used by organizations of all sizes – big companies and small companies – to do tracking of various issues. Oftentimes they’re IT issues and it’s often used in a help desk environment.

My role in the company is I’m the founder and the CEO of the company.  We have 40 people here working here.

Ms. Kelly Luhring:  Okay.  What other industries do you have experience in?

Mr. Hank Luhring:  Well, it depends on what you mean by experience.  Early on, I did a lot of IT and data processing work for school districts and a lot with their finances.  And I did work for Ferox (Ed. Note: Rusty’s first startup) in 1989 and ’90, where I helped support a product similar to SurvivalWare used by corporations to do financial modeling and financial reporting. That was interesting because the customers were in a variety of industries.  Also, I did custom programming when I started my own business in ’92.  I worked with a variety of clients and that, too, was good because I wasn’t focused on one industry. 

Ms. Kelly Luhring:  And do you find with your product that it’s geared towards the same type of audience?  That there are numerous different kinds of companies that use it?

Mr. Hank Luhring:  Yes, there are.  Microsoft is a customer.  Cisco, Verizon, UPS — we’ve got big companies, we’ve got medium sized companies and we’ve got small companies, so it’s just a big variety of customers.

Ms. Kelly Luhring:  And how did you find out about SurvivalWare and what made you decide to use it?

Mr. Hank Luhring:  Rusty Luhring is my brother and I’ve kept up with him throughout his career and I’m always familiar with what he is working on. Early on, I asked if we could use it for financial reporting. Since I had worked with a predecessor to SurvivalWare, a product called Encore, I knew the concepts and knew that it would really help out. And it has.

Ms. Kelly Luhring:  Okay.

And what type of accounting software have you used in the past or are still using? 

Mr. Hank Luhring:  We’ve been using QuickBooks for many years.  We’re about to switch to Great Plains.  We’re in the process of running dual systems right now.  I have used others in the past, but for the last 10 years or so we’ve been using QuickBooks.

Ms. Kelly Luhring:  And do you find that it’s easy to load data from QuickBooks into SurvivalWare?

Mr. Hank Luhring:  Yes, it works out pretty well.

Ms. Kelly Luhring:  And what is your user experience with Excel and what are some of its limitations and how does it maybe compare to SurvivalWare, for example?

Mr. Hank Luhring:  Well, I’ve used spreadsheets like Excel for years.  Before Excel there was Lotus 1, 2, 3 and so on.  I have done financial analysis in Excel.  I’ve even written VBA code to automate Excel to do things, such as grab data out of databases to pull into Excel automatically. Excel is okay for some things, but the approach SurvivalWare takes has a lot of advantages over Excel.  One problem with Excel is it’s almost too easy to set things up.  You can quickly put some numbers in a spreadsheet, put some formulas in, and you’ve got something and that’s very quick and easy to do for simple tasks.  But, if it gets very complicated (and it often does), it gets very hard to maintain an Excel spreadsheet and it’s very hard to be sure that everything’s correct.  Especially if you make changes.  You can have some pretty complicated spreadsheets that are linked to different sheets or tabs and can be linked to external files and everything’s so hidden, you don’t just get a simple listing of the formulas, then it’s really hard to verify that everything’s doing what it’s supposed to do. 

The SurvivalWare approach is quite different and it’s much better just from an information architecture point of view.  What’s very exciting to me about the SurvivalWare approach is that the formulas are not stored in the spreadsheet with the data.  With SurvivalWare, there’s what’s called a matrix file that has just the numbers.  The formulas that operate on those numbers are in a completely separate place.  They’re written in plain English so you can see things like “net income equals revenue minus expenses”.  Those will be spelled out just like I said it and you can have all kinds of complicated calculations, but it’s all very verifiable.  That’s not the case with the spreadsheet. 

Also, it makes for better reporting because your numbers are all in one place.  Oftentimes with rows and columns, the columns will be time periods.  There might be columns that represent months of a year and you might have three years worth, so you might have 36 columns of months.  You might have 12 columns of quarters and then 3 columns of years and then you might have some columns for projections and so on.  And then, the rows often represent accounts from your P&L or your balance sheet.  And then, with all the data set up like that, the reporting is great because you can just write a report to extract the data you want.  Tou might have a very summarized version of the P&L say for the last month.  You might have that same summarization, only instead of last month, maybe the last 12 months or this quarter or the last three quarters or whatever.  And you’re not really changing the underlying structure of the spreadsheet to do that, where you would have to make substantial changes in a typical spreadsheet like Excel.  To do reporting in Excel, with the reporting functions mixed in with the data, it’s harder to do and you can’t get the variety of reports like you can with the SurvivalWare approach.  When you do do the reporting, you’re often making copies of the data or making copies of the spreadsheet and then changing it.  Again, it gets hard to be sure all the calculations are accurate and that you haven’t accidentally broken a link or done something to mess things up.  Fundamentally, the SurvivalWare approach is much, much better than the spreadsheet approach at doing very sophisticated financial analysis. 

Ms. Kelly Luhring:  And how often do you use SurvivalWare?

Mr. Hank Luhring:  Roughly monthly.  At the end of the month, we close out our books and then we export the information to SurvivalWare and then look at reports. 

Ms. Kelly Luhring:  And how long have you been using it?

Mr. Hank Luhring:  Three or four years, maybe five years – something like that. 

Ms. Kelly Luhring:  And did you need any help learning how to use it or was it pretty self-explanatory?

Mr. Hank Luhring:  Well, I think my case was not typical since Rusty’s my brother and Rusty’s also on our Board of Directors. I’ve gotten more help than probably the typical customer.  It’s easy to use and the documentation is really good. But, I’ve been very fortunate.  My guess is, from talking with Rusty, he’s responsive to everybody, not just his brother.  The support is excellent.

Ms. Kelly Luhring:  What did you like best about SurvivalWare?

Mr. Hank Luhring:  I think what I like best is the fact that you can quickly look at things by month and then if you want to take a slightly longer view, you can look at them by quarters and then if you want to look at an even longer view, you can quickly switch to years.  You can look at a very summarized version of your P&L and then, if you see something that looks like you want to find out more about it, you can drill down and keep getting deeper and deeper.  It’s lots of different ways to look at your financial data is what I like best.

Ms. Kelly Luhring:  What feature has become indispensible and really critical for your business?

Mr. Hank Luhring:  Again, I think it’s the way you can look at your financial data in lots of different ways.  It’s not like with an accounting package—you have your choices of some reports, but you have to look at one, and then the other and it’s the ease with which you can look at your data with SurvivalWare.  You can just follow your instincts.  If you’re looking at your financial information and you think, net income isn’t as good as I’d like. I’m wondering why and you can just drill down and see the expenses or see the revenue and determine, is this a trend that’s been going on for months?  And quickly switch to months or switch to quarters.  The flexibility of how you can analyze your data I think is what’s best. 

Ms. Kelly Luhring:  Have you, for example, had to show any reports to your outside companies or banks?

Mr. Hank Luhring:  No, we’re a privately held company.  We’re self-funded.  We don’t have any debt, so we really don’t have to show anything to outsiders.  Althoug, I do have a Board of Directors and I use SurvivalWare to display information to them.  Actually, during the Board Meeting we’re going to have SurvivalWare projected up on a screen and do a financial review that way.

Ms. Kelly Luhring:  Can you think of a specific scenario in which case SurvivalWare was able to maybe put your company in a better state than it would have been without it?

Mr. Hank Luhring:  Well, there was a time period where I had a partner in the business who is no longer with me and he sometimes liked to exaggerate or emphasize certain things regarding the finances and I used SurvivalWare to do a reality check.  I felt like I was helped greatly by having an independent view of things. 

Ms. Kelly Luhring:  And then, also, recently I believe, Rusty had told me about how he had noticed that commission expenses were out of whack?

Mr. Hank Luhring:  Yeah.  You know, there’s the product and then there’s the company behind the product and the product is great.  But, the reason why the product is great is because Rusty has had an unbelievable amount of experience in analyzing financial data for all kinds of companies.  He’s focusing on smaller companies now, but he has had a lot of experience with larger companies, you know, multi-billion dollar companies and they use his software to do the top level reporting.  I remember one particular customer was a conglomerate up in Canada and it had billions of dollars in revenue.   The holding company had companies and those companies owned companies and so on.  It was quite a complicated consolidation operation and it all was done with Rusty’s software.  And the insights Rusty has gained over decades of experience doing financial reporting and modeling helps SurvivalWare customers.  The software is designed by this expert who has had all this experience. 

And then, if you have questions, you’re not just talking to some low level person or hot shot programmer.  You’re talking with someone whose had decades of really high level financial analysis experience. That commission issue was a good example. I asked Rusty to take a look at my finances for December. He called me back and said it looks like my sales commissions are  high for December.  I looked into it and talked to my accounting people and it turned out we accidentally booked January’s commissions into December.  Rusty’s the one that caught it. That’s an example of it’s not just the product, it’s the company behind the product that is so valuable.

Ms. Kelly Luhring:  And so, another thing in talking to other customers, they’ve said the ease of use and then also it’s a time saver in terms of doing the projections very quickly.  Do you find that as well?

Mr. Hank Luhring:  Yes.  It’s designed to make it easy for you to do things like projections.  It has a lot of nice short cuts.  And again, it’s Rusty’s expertise of doing decades of projections for huge corporations that helps.  I remember when I worked for him back in ’89 and ’90, one of the customers was Federal Express and I remember I was doing technical support.  I remember helping them do their projections with Rusty’s productWith all that experience he’s had helping all kinds of companies, big and small, do projections, it’s all been in the software, so that it’s much easier to do it.  So, yeah, it is easy. 

Ms. Kelly Luhring:  And so, what other types of businesses do you think could benefit from SurvivalWare?

Mr. Hank Luhring:  Well, I think any kind of business because with any business it gets down to the dollars and cents and profit and cash flow.  All businesses look at those things.  SurvivalWare is general enough that it can help.  It’s especially useful for businesses of any size that have cash flow problems.  You think oftentimes that it is small businesses that have cash flow problems.  General Motors had a cash flow problem, as well.  It’s useful for any size business.

And you know what’s interesting?  You get these big corporations like General Motors and some of the concepts are the same, whether it’s for a small business or big business.  In other words, one of the metrics SurvivalWare tracks is days of cash.  In other words, based on your daily rate of spending money and how much cash you have, SurvivalWare figures out how many days of cash you have.  That number is a helpful measure whether you’re General Motors or a one person company. 

Ms. Kelly Luhring:  Anyway-—you do feel like there’s adequate customer support?

Mr. Hank Luhring:  Yes.  I know I can get a hold of him, but in chatting with him, I hear him talk about his other customers. It sounds like people get excellent support and that’s probably worth every bit as much as the cost of the software.

Ms. Kelly Luhring:  And so, would you recommend it to a friend or colleague?

Mr. Hank Luhring:  Yep, I definitely would.

Ms. Kelly Luhring:  Okay.

Do you have any last minute comments or questions?

Mr. Hank Luhring:  No, it’s just, you know, a fabulous piece of software and a fabulous company behind it, so I think it’s a real bargain.

Transcription Services Provided By:

eTranscription Solutions, LLC

www.etranscriptionsolutions.org

(740) 385-5994