Keithley Instruments Company Profile
by Julie Henry

Keithley Instruments, Inc. designs and builds measuring devices that use small amounts of electricity to calculate how well things work. Manufacturers around the world buy Keithley's hardware to test everything from cell phones to flat panel displays to semiconductors. And scientists use the instruments to conduct basic research.

The company started in 1946 as a one-man operation on Cleveland's Crawford Road, in a spot between a bar and a barber shop. Today, nearly 400 people work at Keithley's Solon facilities. And another 200 employees are spread out in offices throughout Europe and Asia.

Now if you're wondering what a 56-year-old company with 2001 sales totalling $150 million is doing in a program about entrepreneurship, consider this.

In the early 1990s, Keithley Instruments hit a wall. It could have been the recession. It could have been global cutbacks in research and military programs. But whatever the reasons, after decades of steady growth, Keithley's sales began to fall. Chairman, President, and CEO Joseph P. Keithley says the company was forced to re-invent itself in order to survive.

Joseph P. Keithley: Well the way we sized it up, and I didn't have to do it by myself cause we have such a good team here, was to acknowledge that it isn't just problems outside us, there were some things we weren't doing well. There were some things we needed to do to change.

We had to visit new customers, we began to hear about new needs, and we had to sell in a different way. So there were lot of things we had to change in our organization to carry out this strategic intent that we wanted to pursue.

In addition to breaking into new product markets, change at Keithley has meant restructuring departments by function rather than sales areas. It's meant changing the manufacturing process so that workers are cross-trained in different areas and products are constantly flowing through the production line. And it's meant embracing new technologies like the world wide web and using them to their full potential.

All this change seems to have paid off. The company saw sales rise every quarter from 1998 to 2000. But what about the employees? How did they react to all this upheaval? Keithley says better than you might imagine. He says enlightened self-interest helped them adapt to new ways of working.

Joseph P. Keithley: We engaged people early on rather than having a few executives off in a separate room trying to figure it out and then unfolding it on the organization. So that inclusion helped facilitate the notion that the change was going to be for the positive.

And we had the angst of having all the success and then not having success. So it was clearly well understood and felt we need to change. And that's a large part of the battle, then it's a question of in what way do you change and does anybody lose as a result of the change.

If you're creative and if you're energetic and you adopt these new approaches, and I guess creative and energetic means you have a lot of young people in your organization, there's no telling what you can do.

To maintain the status quo is to fall behind. Change is everywhere and it's forced upon us and why not embrace it as opposed to fight it?

The concept of adapting to survive is one that Keithley says applies not only to established companies like his, but to northeast Ohio as a whole.

Joseph P. Keithley: This region, because of the jobs that are there for people in for example the steel industry. The steel industry employs a lot of people here, but in terms of our future isn't going to be nearly as important as industries that have a tremendous amount of intellectual property. You don't want to do one instead of the other. But if you would take all the money that's been spent on the steel industry or the coal industry or agriculture, just to name three industries that a lot of state money is put in, and direct it toward new industries, whether its polymers or medical devices or biomedicine or the high tech industry that i'm part of, I think you'd see 15 years from now a community which is more vibrant.

There is a tremendous amount of money today at the universities, and the Clinic, and U.H., at NASA Glenn, being spent on research and there's an awful lot of data to support that communities that have major research institutes find that as time goes on, they're able to push new technology through products into new companies.

To the extent that we can have more quote unquote technology transfer agents at the universities and at NASA Glenn would be very helpful.

Keithley also says we can't wait for government or business leaders to change our regional economy. He says it's up to all of us. And that might mean taking some personal risks.

Joseph P. Keithley: Encourage people who have thought that working for someone else all your career is the right thing to do. It may be. But it's also right to start your own company. Know that there are places like the ohio innovation fund and now early stage partners. These are two organizations that combined have almost $50 million worth of money to invest in companies before the companies have any revenue and these two orgs didn't exist five years ago. So there are some support nets if you think of what it takes to start up a company in the area, it's going to be technology, it's going to be capital, and it's going to be people. And I think the people are here if they want to try to do something, we're beginning to get the capital and the technology here is more than you might imagine at the universities and at NASA (Glenn).

I think that this region, and it's true of other regions as well, have an inferiority complex. I think that they feel they aren't as good as maybe we really are. And I think when you feel inadequate it's difficult to dig yourself out of a hole. I think that we need to recognize the strengths that we have and march forward from it.