In the late ’90s, Carl H. Kleimann saw changes rippling through both the human resources outsourcing field and his own company, Odyssey One Source Inc.
“We saw more and more commodity players entering into our industry, meaning they were price-oriented,” the president says. “It wasn’t about quality. It wasn’t about providing strategic HR. It was really just about finding ways to save clients money but not necessarily improving their HR function.”
On top of that, many of Odyssey’s clients had been with the company for five, 10 or 15 years but were starting to outgrow Odyssey’s service capabilities, so consequently they were leaving.
Kleimann knew he needed to change Odyssey in order to adapt, but what direction should he go?
He could follow the commodity players and base everything on price, or he could try to be different by trying to improve the HR processes for small and midsize businesses. Financially, the latter made sense, because his clients would be more willing to pay to have someone help them improve their hiring and training processes than to simply do things like automating payroll, which is what the competition was doing.
“Toyota did a great job of building run-of-the-mill compact cars, and at some point, they decided to form Lexus to kind of go to the next level,” Kleimann says. “That’s what we were hearing from some of our clients. The things that they were having struggles with, nobody was out there bringing solutions for.”
Seeing the opportunity, Kleimann decided to set out to make Odyssey the Lexus of HR outsourcing.
“Things we did in 1990 and 1995 would no longer work in 2000,” Kleimann says. “It was about collaborating with employees, figuring out the direction we wanted to go and executing on those strategies.”
