Spokane Journal of Business

GU agency must break even or close doors

Regional research service simplifies, diversifies in bid to become self-supporting

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Gonzaga Universitys Regional Information Services, an offshoot of the Foley Center library that provides fee-based research services to businesses, has been given an ultimatum: break even or shut down.

Library officials say the universitys administration has given the agency one full fiscal yearfrom May 31, 1999, until June 1, 2000to become self-supporting, something it hasnt been able to do in its six-year history.

Were under a great deal of pressure to assure costs are fully offset by the services that are provided, says Bob Burr, Gonzagas dean of the Foley Center library and associate vice president for information technology.

The problem partly is that many Spokane businesses are reluctant to pay for research services, and businesses increasingly are comfortable finding information independently via the Internet, Burr says.

Businesses such as Hewlett-Packard Co., Avista Corp., the WhiteRunkle Associates advertising firm, and Washington Trust Bank are among those that hire the Gonzaga agency to research specific projects.

For example, Avista Corp. director of government relations Tom Paine says he called on Regional Information Services when he wanted to find private-public groups that were working on energy issues, such as development of cleaner generating plants and reduction of global warming. The Gonzaga agency gave Avista a list of suggestions, and Avista is looking into becoming involved with those groups. Paine says Avista also calls on the agency to conduct competitive intelligence research about other energy companies.

The agency also brokers business lead lists for some small businesses. For example, it gathers an annual list of the names and addresses of all incoming high school seniors here for a local photographer, who in turn sends a direct-mail advertisement to each student about his graduation-portrait service.

Since opening in October 1992, Regional Information Services has worked for 350 different clients, most of whom are in the Spokane area, with some in other parts of Washington and North Idaho.

The fate of the program rests with the agencys leader, Regional Information Services director David Buxton. A Harvard graduate who has worked at Gonzaga for 10 years, the 51-year-old Buxton is the only full-time employee still working in the office. The agency also employed two information specialists and an office manager before talks of cutting the program reached a fever pitch about a year ago, prompting the other employees to look for new jobs or other options.

Three part-time student assistants still work at the agency, primarily providing clerical assistance. One information specialist, Beth Pfeiffer, is still on the university payroll, but is contracted to work exclusively for Hewlett-Packard, which accounts for more than half of the agencys business and is by far its largest client. As a contracted employee, Pfeiffer works at Hewlett-Packards Liberty Lake plant now.

That leaves Buxton to handle all other accounts, a hefty task for one person. During the universitys last fiscal year, the agency handled 150 billable accounts for 40 businesses, bringing in about $135,000, Buxton says.

Revenue has increased gradually each year since the agency opened its doors in 1992, Buxton says. Unfortunately, he adds, expenses have increased proportionately.

During the current fiscal year, which ends at the end of May, the drop in staffing has meant a decrease in expenses, but revenue is declining also, Buxton says. Because hes busy working for established clients, Buxton says hes had little time to generate new accounts.

We are a little enterprise here that should be self-supporting and just hasnt been able to recover all its costs, he says. (Library Dean Burr) has been able to keep the wolves from the door so far, but I think that if we cant break even by May 2000, thats really our last chance.

Bringing new ideas

Buxton and Burr have a couple of ideas that they hope will keep the doors open.

Buxton has introduced two new ways of charging for the agencys services: flat-rate contracts and standard pricing for standard research, both of which should be more affordable for clients.

Flat-rate contracts allow the agencys steady clients to pay one price for one years worth of unlimited service. The value of each one-year contract is based on the clients past usage of the agencys resources, and the prices vary from $500 to $60,000 per year.

Clients that have signed flat-rate contracts include Hewlett-Packard, WhiteRunkle Associates, the Spokane Area Chamber of Commerce, and the Spokane Intercollegiate Research and Technology Institute (SIRTI).

Spokane Area Chamber of Commerce President and CEO Rich Hadley says the organization contracted with Regional Information Services to gather information for special projects and two of its quarterly reports, the Spokane Area Business Barometer and ACCRA Cost of Living Survey.

That (flat-rate contracting) was to our advantage, because it was easier for us to plan that expense, Hadley says. And it encourages us to use it more.

Flat-rate contracts also guarantee a set amount of income for the agency, leveling out some of the financial peaks and valleys that the agency usually experiences in a year, Buxton says.

Buxton also has established standard pricing for standard research, charging set amounts for routine research projects. For example, non-contract clients pay $125 for background research on a publicly traded U.S. company, or $175 for background on a privately held U.S. company.

Previously, the agencys prices were varied, depending on the number of hours spent on research and the expenses incurred, and was usually higher. For example, Buxton says, prices for background research on privately held companies had averaged about $250.

With set prices, companies are more likely to use the service, or at least know whether they can justify the expense, Buxton says.

The more predictable research costs are possible because of a new agreement between Regional Information Services and its primary on-line information provider, The Dialog Corp. That agreement gives the university agency unlimited access for a set price, so it no longer has to pay per-hour and per-document rates.

Diversifying services

In addition to making its research rates more appealing, the agency is looking into ways to diversify its services, something that Burr says is essential to preserve the agency.

Most immediately, Buxton is organizing non-credit seminars, for anywhere from two hours to two days, and is targeting them at a variety of business interests. For example, Buxton says he is working with a computer science professor at Gonzaga to conduct a how-to seminar on Oracle databases. He also has talked to a business professor about teaching a business ethics short course.

If enough businesspeople registered for such classes, conducting seminars could become a moneymaking venture, Buxton says.

Regional Information Services also is dabbling in the knowledge-management business, in which the agency would help companies organize their data so its easier to retrieve. Buxton says a lot of companies are searching for help in managing growing amounts of data, and he is developing a proposal to conduct a knowledge-management study for a local company now.

However, Buxton says knowledge-management accounts are labor intensive, and he would need to bring on additional staff members before the agency could take on many such accounts. Buxton has requested money in next years budget to hire an information specialist, but is dubious about whether the request will be granted.

Ideally, if I could maintain the revenue all by myself that weve had historically, wed be fine, Buxton says. I dont know if we can make that happen.

Buxton has worked in university libraries since graduating from Harvard in 1969.

Linn  Parish
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Editor Linn Parish has worked for newspapers and magazines since 1996, with the bulk of that time being at the Journal. A Montana boy who has called Spokane home for some time now, Linn likes Northwest trails, Deep South foods, and lead changes in the ninth inning.

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