When Barry W. Karlin visited a program
that treated chemical dependency in 1995,
he walked away moved by the staff’s
commitment to help people and resolved
to change his career.
He acquired what is now the forerunner of CRC Health Group Inc. and created a business strategy. He realized that
in the mid-1990s, more than 80 percent
of the population who needed treatment did not get it, and on top of that,
there were no national or regional
companies in the market.
He decided to grow mostly through
acquisitions, but he wanted to do it differently than most roll-up strategies.
Instead of focusing on cost-efficiencies, he instead strived to maintain
those programs’ legacies and add
value through revenue-enhancement
strategies.
This chairman and CEO also didn’t
want to stay just in the chemical
dependency market. He sold the company to a private equity firm in early
2006, and then he led an acquisition of
Aspen Educational Group later that
year.
With this acquisition, CRC is now the
market leader for programs addressing and dealing with underachieving
and troubled youth.
Today, CRC has 5,500 employees
assisting about 30,000 patients every
day in 145 locations around the
country. <<
How Gary Lauer has helped
grow eHealth by caring for
customers and employees
When Clinton Severson arrived as CEO
of Abaxis Inc. in 1996, the company’s
future looked bleak.
The company makes small, portable
blood analyzers for physicians and
veterinarians that require minimal
training and yield results in less than
12 minutes. Despite this remarkable
product, it was trying to do something
that hadn’t been done yet in marketing
these devices for use in physicians’
offices. In the veterinary realm, it was
also up against a much larger company that controlled 90 percent of the
market. If those weren’t big enough
hurdles to jump, Abaxis was also losing money and barely had enough
cash to stay afloat.
Despite all of this, Severson had
confidence in the product. He found
more investors in less traditional
investment firms and raised capital
from 1996 to 2002. With the cash he
needed, he transformed Abaxis from a
losing company to a force in health
care. He asked his manufacturing
director to reduce the cost of making
one component of the product from
$22 to $4, and he was told this was
impossible. He disagreed and found a
new director and management team
to make this and other improvements.
Today, that part costs $4.13 to make.
Under Severson’s leadership, Abaxis
has grown from margins of negative
50 percent to positive 65 percent and
now has 20 percent of the veterinary
market, proving that sometimes you
just can’t take no for an answer.
HOW TO REACH: CRC Health Group Inc., (408) 998-7260 or
www.crchealth.com