Frontier Business Systems founders named SBA Alaska Small Business Persons of the Year

Conservative strategy, quality service lead to success

By SARANA SCHELL, Anchorage Daily News

Published: April 26th, 2005

When Anchorage's economy skidded in the mid-1980s, Frontier Business Systems saw customers go out of business.

But Frontier founders Greg and Lenora Niesen said their company actually grew as competitors collapsed.

Customers want stability when they buy a big-ticket item like the copiers Frontier sells, Greg Niesen said. "They want to make a safe buy."

Frontier seemed safe because it didn't change the way it did business, Lenora Niesen said.  "There were no layoffs," she said, because the company had hired conservatively. "Our customers saw the same people they always saw."

The Niesens are this year's Alaska Small Business Persons of the Year, an honor the U.S. Small Business Administration gives for management staying power, growth in sales and employees, financial stability, innovation in products and services, ability to cope with adversity, and community commitment.

Lenora Niesen said she and Greg were both IBM employees when they met at a weeklong IBM training camp. Letters flew between Alaska and South Carolina for a year, she said, before she moved to Alaska in 1979 "to see if it was really all that."  

At the time, IBM was focusing on personal computers and boosting the cost of service for its office products, Greg Niesen said.  

As a technician, he heard disgruntled customers say they'd go somewhere else if they could.

The Niesens decided to be that alternative. 

The couple started Frontier in 1981 on the brink of a major economic boom in the state, and over time expanded from Anchorage into Fairbanks, Kenai and Kodiak, with 42 employees today.  

Frontier's headquarters on the corner of 15th Avenue and Ingra Street sports a curving metal and neon frontispiece over the entrance. Inside, light filters through sound-reducing translucent white panels. Salespeople have a spacious showroom for putting copiers through their paces. Upstairs, there is a black leather couch in the employee lunchroom.

The Niesens said they pruned their lifestyle and expenses before starting Frontier, and saved enough to avoid taking money from their new venture for a year and a half.

"We sacrificed a lot up front," Greg Niesen said.  That conservative financial approach has stayed their hallmark, the couple said.

"We're not big on setting pie-in-the-sky numbers" as growth targets, Lenora Niesen said. Instead, the couple said they focus on customer value and making sure total sales and profits are growing together.  "We just come in and work hard every day," Greg Niesen said. "Slow, consistent growth will come."

Frontier aims to offer customers higher-end copiers, upgrading as stores like Costco have edged into the market's low end.

The company also employs cutting-edge software to measure its own performance. Each month, Frontier downloads its technicians' service records into a database that lets the company compare its staff with others around the world.

Two years ago, Frontier adopted a program that rewards technicians based on the length of time between calls on a machine, rather than the number of calls handled.

"We said, 'Slow down, fix the problem reported, but also clean the whole machine'" and look for other problems, Greg Niesen said. "We've seen the number of copies between calls go up by placing emphasis on the quality of the call."

Frontier also subscribes to independent industry publications that it shares with customers so they can see how Frontier's brands compare to others.

The infrastructure has a cost, so Frontier isn't the cheapest option.  Frontier lost a recent bid with the Alaska Railroad over price, said the railroad's director of information services, Pamela Means.

"I'm unhappy they didn't get it," Means said. She said Frontier's service on a separate contract let her small team focus on computers rather than copiers. "I don't want the cheapest thing. I want what's going to work."

Frontier will continue to focus on value, the Niesens said.

"We care how we treat our employees. That has a cost," Lenora Niesen said. "But it's necessary to keep good employees, and that provides stability for customers. And it's what we want to do anyway."

Daily News reporter Sarana Schell can be reached at sschell@adn.com or 257-4466.