Business owners and former Rockettes get kick from E-Myth program

Classically trained dancers. Former Radio City Rockettes. New York City natives. Identical twins. Master's Degrees from Columbia University

By Jill Tydeman, Certified E-myth Coach

	Client: Katherine and Kimberly Corp
	Business: Pilates Center of New York, Inc.
	Home Office: Midtown Manhattan, New York
	Personnel: 8 full time, 22 part-time
	Years in Business: 4
	Began Mastery: 1/2003
	Revenue/Profit in 2003: $731,000 /-2% profit
	Revenue/Profit Today: $1,043,000/4.8% profit
	E-Myth Mastery Coach: Mark Shapiro

HOW DID YOU GET STARTED IN THIS BUSINESS?

Katherine:
We were professional dancers in addition to having corporate backgrounds. When we discovered Pilates, we loved it. We dreamed about opening a studio of our own, but it was very much just a dream at that time.

Kimberly:
Even though we both had graduate degrees, we had trepidations about opening and running our own business. Our dad encouraged us with his "just do it" attitude and his moral support. We sold our vacation condo to capitalize the business.

WHAT WAS YOUR BIGGEST SURPRISE AFTER YOU OPENED YOUR STUDIO?

Kimberly:
We opened in August of 2000, and had a huge influx of clients in early 2001. For the first year, we did not even have an office; then we "promoted ourselves" and shared an office no bigger than a closet. We were working crazy hours.

Katherine:
We grew so fast -- too fast, actually. We had no way of planning for the peaks and valleys of the business. We also had no escape from the business because it was dependent on us to run it. Both of us had gotten engaged, and then married shortly after opening the business. Juggling time between the new business and the new husbands was nearly overwhelming.

IS THAT WHAT MOTIVATED YOU TO MAKE SOME CHANGES?

Katherine:
Absolutely! I had already realized that business school doesn't necessarily teach you how to run an atypical business -- like a Pilates studio -- where client fulfillment is so vital. A friend recommended The E-Myth Revisited, and the book made so much sense to me that I decided I wanted to do the coaching program that E-Myth offers.

Kimberly:
I knew I wanted things to be different, but I was too swamped and too tired to take on one more thing. Katherine finally convinced me to read the book and join her in the program, and it's made a tremendous difference.

WHAT CHANGES HAVE HAD THE MOST IMPACT?

Katherine:
Our approach to the business emotionally has changed dramatically since we began. We both attribute this change 100% to our E-Myth coach. We both tend to be more "people people" rather than "numbers people" and we naturally focused most of our efforts on client fulfillment, lead generation and lead conversion. Our coach helped us balance these skills with better use of financial statements. Because we were so busy doing everything ourselves, the only financials we looked at were revenue and expenses. Our coach helped us learn to use the ratios and pay closer attention to those parts of the financial statements we had been neglecting. One of the major decisions we've made through our coach's guidance was to close our second location, which was increasing our expenses greatly and not bringing in the profit we were expecting. We were so concerned with NOT adversely affecting our clients at the second location that we needed our "blind optimism" held in check! Our coach helped us realize from a numbers perspective that our instincts to close the second location were right.

Kimberly:
Also, September 11 hit us very hard, as it did many small businesses in Manhattan. We definitely hit a plateau after that and our profits haven't gone up as much as we had predicted based on our first year in business. But we have been able to pay down a substantial amount of debt and the business is now much healthier financially. Closing the second location and investing in the expansion of our primary location was a no-brainer, once we really understood what the numbers were telling us. We both took accounting classes in graduate school, but it took E-Myth to help us integrate caring for the financials AND caring for clients. Our business is very dependent on the personal relationships we develop with our clients, so our decisions had not been based solely on numbers, which is what accounting tends to teach. Our coach helped show us how to review our financial statements from the perspective of a business owner concerned with all aspects of the business.

WHAT HAS BEEN YOUR BIGGEST CHALLENGE IN RUNNING A BUSINESS?

Kimberly:
Without question, managing employees. We found it more challenging than we ever could have imagined. Admittedly, we both were shocked and surprised at how some people behave!
Katherine: We've developed a lot as managers. Before, we got too friendly with people. This program has taught us to be much more objective. We can hold firm now that there are standards that need to be met and we can communicate to employees firmly if they aren't meeting these requirements. This has been a huge step for us to be this objective, because we fell into the trap of being ‘too nice' before that. One of our favorite mantras that we repeat almost every day now was taught to us by our coach -- "Don't Pick up the Rope."

"DON'T PICK UP THE ROPE?"

Katherine:
A tug-of-war requires two opposing forces to pull on each end of the rope. If we don't battle with employees, if we remain objective and don't pick up our end of the rope, then the situation remains manageable. This phrase has a multitude of applications in communicating with many different people, not just employees! The other one was, "good enough is good enough." We are both high-achievers and perfectionists and it might have taken us forever to systemize our business because we were obsessing over every detail. Now, we know it doesn't have to be perfect; it's ok to keep it a work in process. This point of view shift has had a great impact on us.

HOW DO YOU FIND EMPLOYEES WHO CAN DO WHAT YOU DO?

Kimberly:
We don't! We look for people who are willing to learn how to do what we do. In the beginning, we were lucky and had really solid people. We did not realize their skills weren't universal and grew accustomed to their efficiency and work ethic and came to depend on that. Thus, when they left, we realized how challenging it is to find qualified workers who not only can do the job, but also "fit" into our company. Our coach helped us develop the skills to find qualified people to replace them, especially the intangible aspect of hiring, namely, insuring that an applicant is a "good match" for our business. Our recruiting and hiring systems became one of the most important drivers for growth in our business.

Katherine:
We went through many bad hires that could not perform the job requirements or meet the standards that we wanted the business to reflect. Now, we're able to choose employees who are team players and willing to learn their systems, more quickly replacing those who aren't on board with our vision for the company.

THERE MUST BE THOUSANDS OF FITNESS OPTIONS IN MANHATTAN. WHY DO PEOPLE COME TO YOUR STUDIO FOR THEIR FITNESS NEEDS?

Kimberly:
The comment we most often receive is "you have the best instructors." We have personally trained all of our instructors and we are so proud of each and every one of them. This is the best compliment our business could receive. On top of that, we try to listen to our clients' needs and act accordingly. When we started asking our clients what they really wanted, we got a few surprises. Our first studio was only a little over 1000 square feet and had no showers or dressing rooms. The lack of amenities was actually driving customers away. We expanded to over three times that size, renovated the exercise area, added dressing rooms with showers. Now, the whole studio is designed to be a quiet sanctuary from the pressures of the outside world.

Katherine:
E-Myth gave us the tools to become very client-centric (in a financially healthy way!), which had been our goal when we opened our business. When we closed the second location and improved this one, we actually greatly expanded our customer base because we were better meeting their needs.

WHAT MAKES THEM COME BACK WEEK AFTER WEEK?

Kimberly:
Our instructors are trained to progress clients safely and motivate them to meet their fitness goals. But of course, we really struggled with a common problem in the fitness industry: getting clients to stay beyond a couple of lessons. With the help of our coach, we brainstormed and came up with the idea of an "After Eight system" which provides a system for monitoring the studios' ability to meet clients' needs. Now, even long-term clients are routinely -- but informally -- surveyed to find out if their needs are being met. We talk to them after their 8th, 18th 28th, etc. lesson. Our clients continually buy 10, 20 even 40 packs of lessons, so we take this as a good sign!

Katherine:
We also discovered that many clients wouldn't complain about service, they just wouldn't come back. Our coach helped us view this "problem" as an "opportunity!" If we knew why they weren't returning, we would have the opportunity to solve the problem. Our reception staff calls newcomers the next day to follow-up on their lesson. Additionally, we started including a one-minute client survey after the first eight visits to stay in touch with the client's feedback and make an effort to improve their experience in subsequent sessions. This way, we can be proactive about meeting our client's needs. And this has greatly informed our client fulfillment systems, which were like a leaky bucket before. We kept getting new clients but then we'd lose some, too. Through the After Eight system and client fulfillment systems developed with help from the E-Myth program, we now have a huge influx of new clients, we keep the current ones longer, and we have daily reports to quantify the results that we're getting.

HOW HAS YOUR TYPICAL WORKDAY CHANGED SINCE YOU STARTED WITH E-MYTH MASTERY?

Katherine:
We've become clearer and clearer about our vision for this business through E-Myth. Before we opened, all we did was plan for the business, but as we got busier and busier, we didn't spend as much time planning because we quickly fell into doing, doing, doing. Now, we spend consistent time ‘planning and plotting' as we call it. This, and everything else we've learned with E-Myth, has greatly impacted the quality of our lives.

WHERE HAVE YOU SEEN THAT "QUALITY OF LIFE" IMPACT?

Kimberly:
In so many different ways! For example, the business isn't as dependent on us to run it; we've cut back our work hours; and we are able to pursue other interests, such as being able to leave the business last summer to film parts in the recent Hollywood movie, "The Stepford Wives." We never could have done that the year before.