CEO Reels in Clients with Fish Story from the Chicago Tribune Business Section 9/16/13

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When Karen Eng meets with potential clients, she often totes along her iPad so she can show off a prized photo. In it, she stands beaming on a boat, raising the tail of a short-nosed swordfish she’s just reeled in off the coast of Maui. It weighed 40 pounds.

In her world of engineering, one predicated on prototypes and programs, this is Eng’s way to place the focus on relationships.

“Almost every single time,” Eng said, “I go in there, and you have your slot, from like 10 to 10:30 a.m., to present. The people before me and the people after me are two men. …

“And they wear khaki slacks or black slacks and a blue shirt and a white shirt. And so there is this, whatever you want to call it, standardization that goes on.

“And then I show up, and I have, like, this (iPad), and I go, ‘First of all, I need to show you, I caught this fish.’

“Or I’ll say something like, ‘One of my favorite things in the whole wide world is nacho cheese,’ which it really is. That kind of personalizes it, you know, versus just getting started, straight up, like a presentation.”

Still, as a non-engineer among a phalanx of engineers, Eng already stands out.

The president and CEO of CSMI, an engineering services firm, Eng, 43, holds an advanced degree not in engineering but in optometry. In school, she spent years studying the human eye but now spends her time figuring out how to solve the packaging problems of companies like General Mills, Hillshire Brands and PepsiCo.

In the past 18 years, Eng has transitioned from doing administration in the Schaumburg headquarters of CSMI, which her father started in 1983, to managing operations and co-owning the business with her dad, to becoming CSMI’s sole owner.

Now, her ambition is to shepherd its growth.

Revenue for CSMI has jumped from $7 million to $8 million last year, according to Eng, to a projected $15 million by the end of 2013. She attributes part of the increase to an expansion in services, such as buying equipment for clients.

Another reason is Eng’s civic involvement. She sits on the boards of directors of the Girl Scouts of Greater Chicago & Northwest Indiana, the YWCA Metropolitan Chicago, the Illinois College of Optometry and the Chicago Minority Supplier Development Council. These activities allow her to make new connections that provide openings for her company to land more work.

This year, Eng was inducted into the Chicago Area Entrepreneurship Hall of Fame at the University of Illinois at Chicago’s Institute for Entrepreneurial Studies. Two years ago, she was named one of Enterprising Woman magazine’s Enterprising Women of the Year.

In the past year, Eng has attracted so much new business that CSMI had to turn away work because it would have been too much for the roughly three dozen employees she oversees.

As a result, Eng is hiring engineers and considering acquisitions.

“Her energy and her desire to grow the organization are what appeal to me,” said Larry Kujovich, senior partner at Executive Partners, who met Eng through a consulting job for CSMI but has become a mentor and friend. “I think the future of CSMI is extraordinarily exciting.”

Putting pieces together

CSMI has a suite of offices on the fourth floor of a high-rise in Schaumburg, just off state Route 53, in which Eng, a feng shui aficionado, has hung various mirrors and crystals in discreet corners.

In her office, where orchids bloom on a window ledge, Eng works on a MacBook Pro, reading proposals and communicating with clients. Though much of the drawing, design and programming are done in the office by engineers, the action-oriented part of CSMI takes place in plants all over the U.S. and the globe.

CSMI designs production lines at manufacturing plants and provides expertise on operations. Its clients — food and beverage companies and pharmaceutical firms — are regulated by the Food and Drug Administration or by the U.S. Department of Agriculture.

For instance, when Capri Sun, which is owned by Northfield-based Kraft Foods, decided to appeal to older kids with its spout-topped Big Pouch, CSMI figured out how to divert the ingredients into the new pouches, put the pouches into packaged boxes and put the packaged boxes onto pallets.

What CSMI does, Eng says, is analogous to designing a media center for a home.

“So I would specify all the pieces of equipment,” Eng said. “I don’t make a TV, I don’t make a receiver, I don’t make the speakers. But you like movies that are action, so of course, we’ll get the big screen and the speakers that surround you. We’ll say, ‘This is the best for what you want.’

“And then we get it all installed and in your house, connect it all, program the remote and teach you how to use it.”

Tom Pirko, managing director of Bevmark, a food and beverage consultancy based in California, does not know Eng but said the kind of business she runs is “in a boat at high tide.” Public consciousness of health, wellness and safety in manufacturing has driven innovation in the sector, he said, which in turn increases demand for the kind of services CSMI offers.

Father’s vision

Thirty years ago, Eng’s father, Joe, started CSMI, inspired by his engineering experiences at Kraft and Air Resources Inc.

At Kraft, he familiarized himself with the manufacturing and packaging processes for products like cheese and salad dressing; at ARI, he helped manage projects in the chemical industry.

Joe Eng started Cybernet System Management Inc. with the vision of applying the automation he witnessed at ARI to food manufacturing, which he called labor intensive because it required so much manual handling.

“I needed to apply the technology in petrochemical to food technology,” Eng said. “That was my motivation and my insight into starting the company.”

Born in Chicago’s Ravenswood neighborhood, Karen Eng lived in Chinatown, where her mother and grandmother grew up, until she was 2. (Her father emigrated from Hong Kong when he was 11.) But her parents decided they wanted their kids to play in yards, Joe Eng said, instead of alleys.

So the Engs moved to Schaumburg, where eight years later, they had another daughter, Cheryl. While a student at James B. Conant High School in Hoffman Estates, Karen worked at a Marshall Field’s store and helped clean her father’s CSMI offices.

Karen remembers dusting. Her father remembers how she helped scrub the office toilets.

Joe Eng said he and his wife, Doreen, wanted their daughter to be any kind of professional, though Karen said she felt that her parents wanted her to become a doctor or a lawyer.

While attending the University of California at San Diego, Eng worked for an optometrist, helping kids and stroke victims with their hand-eye coordination.

“That optometrist that I worked for said, ‘You need to go into this. This is the best profession ever,'” Eng said, adding that he made several introductions for her.

She took his advice and packed for Boston to attend the New England College of Optometry, where her fun-loving side — which can compel her to hop on her black Harley-Davidson Sportster and ride it to work — often emerged.

Her friend and classmate Karen Grucci Brown recalled that they were studying at Eng’s apartment in Boston on a rainy night.

“We were really tired of studying and needed a break,” said Grucci Brown, now an optometrist in North Carolina. “She suggested we go play in the rain! So that’s what we did — two, 20-something-year-old optometry students playing in the puddles at night in the city. It was one of those things only Karen would think of doing.”

Big plans

After optometry school and a fellowship in Baltimore, Karen Eng devised a plan to become what she called “an eye doctor to the stars.”

She would move to Southern California and target people “who had so much money, they would need different outfits and different glasses. But then again, I came out with all this student loan debt, so I was like, ‘How am I going to do this?’ And if it fails, I gotta go work for somebody. I never wanted to work for anybody.”

(This sentiment has been adopted by Eng’s 9-year-old daughter, Kiana Pouyat, who, while relaxing on the deck of their North Barrington home recently, said, “My parents say, ‘If you be your own boss, you do anything you want.'”)

By the mid-’90s, Eng had moved back home with her parents for the summer to relax until her father asked Eng to come into the office to help with administrative tasks.

Then, she made a giant pivot.

“Here was my thought process: Basically, I was like, ‘I want to have a certain lifestyle, and to afford that lifestyle, you have to generate revenue,’ and I thought, ‘You generate revenue by seeing patients.'” Eng said. “So the more patients you see, the more money you make, versus something like, at the engineering firm, you have the engineers doing all the work for you. The scalability is easier.

“But what I failed to think about is, if you hire optometrists, then you’re not going to have to work as hard. It’s generating revenue by managing the practice, by having other people in place doing it and not me seeing patients for 20 hours a day. I didn’t think that far in advance. But it’s a whole different scale.

“I just thought (CSMI) was more scalable, and I kind of had that Tom Sawyer attitude: Get everybody to do something for you. But little do we know how much I work. I was up at like 3 this morning, just answering stuff, and it’s fine.”

Her dad had not yet devised a succession plan for CSMI, so Eng asked him to give her five years to learn everything she could about the business, with the expectation that she would manage it someday.

“I was in total shock,” said Joe Eng, when Karen told him of her plan. “I didn’t remember her ever mentioning it before. Otherwise I would have sent her to engineering school.”

While still practicing optometry at the AccuVision on Michigan Avenue on the weekends, Karen immersed herself on the weekdays in the purchasing and proposal processes at CSMI, as well as engineering operations, at least from a macro standpoint.

“She did not get into the minute details of how a robotic arm could rotate 360 degrees,” Joe Eng said, “but she knew enough to say, ‘Somebody has to study that.'”

From the start, she prized building relationships.

“Karen was smart enough and wise enough to deal with these (purchasing) guys, where I was not,” Joe Eng said.

Five years ago, Eng bought out her father and became sole owner of CSMI in what Joe Eng calls a natural transition.

“I was very confident,” he said, “that she could take this thing and probably do better than I could.”

Since then, Eng has not only bolstered staff and revenue numbers but also expanded CSMI’s global reach, with jobs in the Philippines, China, Vietnam, Mexico and United Arab Emirates.

Michael Espinosa, CSMI’s director of engineering, who has been working at the company for nearly 17 years, said seasoned engineers might think Eng’s lack of an engineering background is a communication barrier. But Espinosa acts as a buffer. The newer engineers, he said, tend to understand that “Karen doesn’t have all of the technical background, but she knows the business.”

Eng says she makes a practice of admitting that she is not an engineer by education or training.

“When you are upfront from the beginning, saying, ‘I don’t understand this,’ then it’s easier to admit it than pretending you know what you don’t know,” Eng said. “And I’ve always been that way. But I’m intelligent, so, when they do explain things to me, I do understand them. And I understand what the capabilities of this firm are and what they’re not.”

Jon Riechert, a senior corporate engineer with Hillshire Brands, said it doesn’t bother him that Eng isn’t an engineer. What matters to him is that she communicates. If he has a question on a project, he says, Eng is always able to get him an answer.

Riechert first considered CSMI for a project six years ago after a Girl Scouts event, where Eng met Brenda Barnes, the former CEO of Sara Lee Corp., from which Hillshire Brands was carved.

Impressed by the confidence Eng showed in her staff, Riechert hired CSMI to figure out how to improve the efficiency of moving Jimmy Dean sausage from the packaging area to the chiller at a plant in Tennessee.

“It’s very difficult to get our plants to actually like people that our corporate group picks out,” Riechert said. “But the plant liked them so much, they started calling (CSMI) directly.”

One of the most challenging tasks so far, Eng said, has been to manage clients’ expectations.

“We are engineers; we are not psychics,” Eng said. “If you want something, you have to tell me what you want, and we have to make sure that we can balance that.”

Once, Eng said, a proposal written by someone else set unchecked expectations that proved costly.

“I had to own up to it,” she said. “The client was like, ‘You wrote in this proposal you would run 700 bottles per minute. Why is it only running 500? I had to go back and fix the whole line.

“I only did that once, but those are the types of things that you don’t want to get caught on, and until you make some of those mistakes, you don’t learn.”

Linda Emmert, in her 14 years as CSMI’s office manager, has watched Eng rise at the company, and she credits her boss’s persistence for the company’s growth.

“She’s very determined,” Emmert said. “When she’s convinced other people want and need us, it’s, ‘I’m going to get this client.'”

Karen Eng

Born in: Chicago’s Ravenswood neighborhood

Raised in: Chicago’s Chinatown and Schaumburg

Lives in: North Barrington

Family: Husband Scott Pouyat, 42, and daughter, Kiana Pouyat, 9

Education: Bachelor of Science in biochemistry and cell biology at the University of California at San Diego and Doctor of Optometry at The New England College of Optometry; executive education program at Tuck School of Business at Dartmouth College.

Eats at: Shaw’s Crab House and the Little Goat Diner

Junk food addiction: Nacho cheese and chips

Shops: Through a stylist at Nordstrom

Enjoys: Playing golf. Eng’s home backs up to a driving range.

Spends time with her daughter: Going to Girl Scouts events and cooking lasagna, dumplings and chicken Parmesan.

Vacations in: Maui

How she lets an employee go: “My approach is to be direct, but encouraging. I ask to speak to them in my office and clearly state that this is not going to work out.”

Areas of personal improvement: Time management. And her golf game.

http://articles.chicagotribune.com/2013-09-16/business/ct-biz-0916-executive-profile-eng–20130916_1_general-mills-karen-eng-hillshire

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