KLA Laboratories: 77 Years and Counting
By Mindy Kroll
Universal Advisor, 2006 Issue No. 3

Headquartered in Dearborn, Mich., KLA Laboratories was founded in 1929 as a custom radio/electronics manufacturer and sound system contracting company. Over the next two decades, the company morphed into a Hi-Fi retail chain until Pat O’Bryan assumed control of the company in 1964. “My father believed that there was greater potential in the systems contracting and installation business,” says Matt O’Bryan, President and Chief Operations Officer of KLA. “He was right.”

Today KLA Laboratories is among the largest communications contractors in the nation. They install structured cabling and fiber optic networks for the Big 3 and provide sound systems and A/V rentals to clients in industries such as manufacturing, government, and education, as well as churches and entertainment facilities. The secret to their success? “Our people,” responds Matt without hesitation. “The brunt of our business is labor — we aren’t selling a lot of materials. Quality, skilled people are all we have.”

All in the Family

CEO Norma O’Bryan was a stay-at-home mom when her husband, Pat O’Bryan, passed away in 1991. Matt was still in college, his sister Mary was a secretary at KLA, and his brother, Don, was working in shipping. “Dad believed that you should work your way up in the company,” laughs Matt.

“It was a difficult time,” admits Norma. “I was thrust into this leadership position, and I wasn’t sure whether we should keep the business or sell it. I went to Don, Matt, and Mary and said, ‘If you want it, I’ll hold on to it.’” As is customary for the O’Bryans, they pulled together and kept the business going.

“I’d always liked it at KLA,” says Matt. “I’d been working there part time since I was 12 years old, labeling and stamping out wire tags. I realized very quickly that I wanted to be part of the business. Now I can’t imagine doing anything else.”

I’m With the Band

Something you may not know about KLA: playing in a band may as well be a prerequisite for employment. “Seven of our 18 full-time office staff are in bands,” says Matt, which makes sense given their expertise in audio. And we’re not just talking entry-level staff; Matt plays guitar and sings in The Wrenfields, an alt-country band that plays throughout the Midwest. “We recently interviewed a man who told us he’d need to leave early some Fridays because he played in a band,” laughs Matt. “I think my brother hired him on the spot!”

So what makes KLA such a great place to work, aside from its support of staff extracurricular activities? “I think a lot of it is the variety of work that we do,” says Matt. “A person might work on a sound system one day and A/V rental or a computer network the next. That’s the challenge of the work we do. Our staff becomes skilled in every facet of our company.”

It must be working, because turnover at KLA is virtually nonexistent. Most installers have been with KLA for more than 10 years, and a handful have been with the company more than 30. “We recently installed a brand new sound system for The Palace of Auburn Hills,” recounts Matt. “We had a five-day window to complete the project which, although we were working around the clock, is virtually unheard of, as the Palace is one of the busiest arenas in the United States. One of the things that helped us complete the project more quickly and efficiently was that KLA installed the Palace’s initial sound system when it was built in 1987. Five staff members had actually worked on the original system, and other crew members had a connection in that their fathers had worked on the original system. If we hadn’t had that history and the information that can only come from firsthand knowledge of a project, it would have been much more difficult to meet our deadline.”

A Commitment to Customer Service

In addition to low staff turnover, KLA boasts an equally low customer turnover. In fact, their three largest clients — Ford, GM, and Chrysler — have been with them since 1929, 1933, and 1942, respectively. KLA has had similarly long relationships with the Detroit Tigers, Detroit Lions, and the Archdiocese of Detroit. “This may sound obvious, but our goal is to maintain our customer base,” says Matt. “We’re competitive with ourselves in that we want to provide the level of service we provided 50 years ago — and we were great 50 years ago. I think a lot of it has to do with our hands-on approach. I personally spend a lot of time on the road at customer sites to make sure that they’re satisfied. I think people value this personal attention.”

Planning for the Future

Only one-third of family-owned businesses in the United States survive into the second generation; of those, only one in five makes it to the third. How does KLA plan to transition into the third generation?

“My brother’s oldest son has been working here since high school,” says Matt. “He’s only 19, but he seems to have a genuine interest in the business. We’re trying not to put too much pressure on him, but he has a future here if he wants one.”

“My husband always said to get the best attorney and the best CPA you can get,” continues Norma. “He said that you can’t go wrong as long as you confer with them before you make your decisions. We’ve worked with Plante & Moran for nearly 40 years, and we’ve always consulted them before we made a move. We might use them more than is necessary, but it allows us to feel secure in our decisions. You can’t put a price on that.”