Trimmer TouchStar Ready for Growth: CEO Bederman

TouchStar, a developer of world class call center technology with on-site and hosted deployment options, is getting some flak in the market for the recent reduction of its workforce, according to CEO Steve Bederman.

The Denver-based company, which counts among its clients 700 collection agencies and law firms that specialize in collections, cut about 50 positions recently, reducing its total workforce to 275, Bederman said, alleging that some competitors – who he declined to name – have started rumors regarding the company’s viability in light of the staff cuts.

But the 15 percent reduction strengthens rather than weakens the firm, Bederman said.

“We implemented a (self-developed) scorecard program to measure efficiency and progress in every layer of the company,” Bederman explained. The top scorers received bonuses and the ones at the bottom were the employees who were cut.

“We conducted an evaluation through each workgroup” and compared costs and benefits, Bederman said.

By keeping the most productive employees, TouchStar and its clients receive the benefits of a better total workforce, according to Bederman. He added this is the type of action typical of a company moving from its initial, entrepreneurial stage to a firm focused on further growth.

“We’re not a troubled company, we’re a company that’s organized [for growth],” Bederman said.

The scorecard and workforce adjustment moves have already shown benefits, Bederman added. “We’ve increased sales and productivity beyond our expectations.”

Annual costs were cut a projected $7 million. So the privately held company recently increased its forecast for earnings before taxes, interest and depreciation (EBITDA) from $4 million to $6.5 million for the current calendar year and its forecast for sales from $29 million to $31 million

The company also strengthened its position for its planned initial public offering in the next 24 to 30 months, Bederman said.

Before that occurs, Bederman expects TouchStar to announce two acquisitions. The company is currently conducting its due diligence, so Bederman declined to discuss those plans in more detail.