Alpha Entrepreneur Case Study 2

Fred CherryCherry Engineering Support

Services, Inc. (CESSI)

Aa

Led by CEO Fred Cherry

- Business Started: 1992

- 8 (a) Small disadvantaged minority-owned business

- 95 Employees

- Does business with most of the federal agencies in Washington D.C.

Cherry Engineering Support Services CESSI

McLean, Va.

Engineering and Accessibility Consulting

- Decorated U.S. Air Force pilot Korea and Vietnam- injured in Vietnam during ejection from fighter plane..broken ankle and wrist, crushed shoulder

- 7and 1/2 years as prisoner in North Vietnam, injuries exacerbated during his imprisonment

- Now mobility disabled- limited movement of left arm and shoulder…difficulty walking

- Awarded Air Force Cross, Silver Star, Legion of Merit, Distinguished Flying Cross

What is his disability and how has it affected him?

- Gained experience working in three 8(a) minority-owned companies

- Went to mentor, trusted friend, former POW cell mate and entrepreneur for guidance

- Mentor offered to help him start his own 8(a) business with assistance from mentor’s company

- Learned managerial discipline early from mentor’s company

- Started business in field he knew…engineering and accessibility for those with disabilities

Why and how did he start his business and what preparation or resources did he have?

- Hard to convince clients he was qualified, especially as minority business with only 2 or 3 employees

- Used mentor’s company contacts to gain access to banks and introduce him to SBA support

- Although his disability wasn’t as noticeable and it did not adversely affect his financing efforts, he feels banks are reluctant to lend to those with disabilities.

What access barriers did he face when he started his business and how did he overcome them?

- Tapped his managerial experience, discipline from military and prior companies

- Drew up business plan strategy with strong trend plotting

- Worked with mentor company to orient his plan

- Used managerial discipline to insure he stayed on track precisely with his projections, managing growth by structuring cash flow to avoid debt

How did he develop a business plan and create a managerial structure?

–- He wanted integrity, honesty, people he could trust - Selected people who enjoyed their work and had strong will and work ethic

- Looked for people who would become engaged with the business

- Chose people with disabilities, not because he was disabled, but because he wanted them to understand his market

How he select his board members?

- He believes most businesses fail from poor management of workload and finances

- Judicious use of a credit line forces him to employ managerial discipline to stay on track with his projections and this is viewed favorably by banks

- Does not allow his business to grow too fast because this would incur too much debt leaving him vulnerable to problems

- Monitoring growth, bootstrapping, are reasons for his success

How did he insure funding to finance his growth?

- As with many service firms, he started with the government market

- Once he solidified his market, he worked hard to get into the private sector

- He pursued relationships with private companies who were major government contractors and who had succeeded in expanding into private sector….thus, they guided him

What were his market strategies and how did he implement them?

- Initially stayed in areas he knew…engineering, aviation with the FAA, through subcontract

- Grew into other agencies rapidly through prime contracts via support for accessibility projects…deployed vertical capability to horizontal markets

- SWOT- Strength, Weakness, Opportunity, Threat…used strengths to combat threats…used opportunity to mitigate weaknesses

How did he choose what markets to pursue and how did they evolve over time?

- He used his employees to get in the door…every employee is your best marketer

-His employees with disabilities are especially to markets that requires accessibility support

- Words are the message…and presenter of the words is the message

How did he market to his target demographic?

- Technology helps companies and government and private sector comply with ADA

- Accessibility technology requires evaluation…his employees evaluate and demonstrate the technology and government agencies require his company’s support to implement the technology

- When agencies see his employees with disabilities demonstrating the technology, they also see the capabilities of his employees

How has he used technology to grow his company?

- Mentor company guided him to avoid pitfalls

- Mentor company taught him about 8A

- Mentor company helped him get Department of Labor contract by making DOL comfortable that mentor company was watching over CESSI’s performance

- Again relied on military-style management discipline of mentor company to build similar infrastructure in CESSI

What strategic partnerships and alliances helped his company succeed?

- Client Satisfaction…number one priority

- Monitor and maintain harmony in relationship between clients workers and CESSI employees

- Give the client the benefit of the doubt during disagreements

- Give customer best possible price

What strategies did he employ to maintain competitive edge?

- ADA was major reason for CESSI’s existence and growth

- Complying with ADA has had positive effect on company…qualified people with disabilities throughout company

- Follow on Section 508 has been important to his growth in helping government comply with new requirements

How has implementation of the ADA and Title 5 of the Rehabilitation Act affected his company?

- Wants to grow out of program because of success, not just be phased out

- Wants to have diversification from developing capabilities in all SIC code areas to insure success

- Wants graduation to be seamless

What are his plans for CESSI when it no longer has 8(a) status?

- He would have focused earlier on bringing employees with disabilities into the company

- Vision and mission should be cued to be the model that you live by

What would he have done differently if he had to his business plan all over again?

- Don’t feel inferior…you can do it if you want to

- Get involved with a mentor…seek the help that you need

- Seek the help of the SBA…entrepreneurs with disabilities should seek 8(a) status - Use the Internet when you can…wisely efficiently

- Become comfortable with IT and integrating use of the computer

What advice would he give to people with disabilties who wish to start their own business?

- Some say his imprisonment was terrible…but he says good came out of it…he doesn’t take things for granted as average American does.

- We didn’t get good life for free…there’s been much bloodshed for the freedoms we enjoy

- Developed lifetime friends from camaraderie…if one suffered they all suffered…from this he learned compassion for human race

- He wouldn’t change anything, including being a prisoner…it made him aware of so much more

How did Fred Cherry’s life experiences affect him and what has he learned from them?

- (703) 448-6155

- e-mail: info@cessi.net

- 6858 Old Dominion Drive Suite 250 McLean, Va. 22101

How does one contact CESSI?