July 25, 2023

Balancing Entreprenuerial Risk and Operational Safety

For our ninth episode, President & CCO Ethan Whitehill chats with Skuli Gudmundsson, President & CEO at OCCU-TEC. Skuli shares his career pivot into entrepreneurship and the importance of safety & health in the workplace.

Get to the point with us on the last Tuesday of each month!

Episode Transcript

Ethan Whitehill: Hi, everyone. I’m Ethan Whitehill, President, and Chief Creative Officer at Crux, the “un-agency” that fuels business growth. We have a great guest today, who is a testament to the spirit of our podcast, To The Point, someone who has lived the entrepreneurial journey and built a strong business and brand. 

Skuli Gudmundsson, President and CEO of OCCU-TEC. Following a successful corporate career with TWA, Skuli embarked on a mission to fulfill a dream of owning and operating his own business. Having lived in many parts of the world and traveled extensively during his airline career, it was easy to see that America is truly the land of opportunity, where dreams like that can become a reality. 

Skuli co-founded OCCU-TEC in 1983 as a consulting and training firm to help clients effectively manage environmental, occupational health, and safety issues, and improve overall productivity. Today, OCCU-TEC has grown into a multi-disciplined organization, with client service and loyalty remaining key to its success. 

Skuli, welcome to the show.  

Skuli Gudmundsson: Thank you, Ethan. Glad to be here.  

Ethan Whitehill: Well, let’s start here. You were born in Iceland and spent your career and young adult years traveling internationally, and I know that period was influential to your growth as an entrepreneur. Can you please share a bit about that journey and what brought you to Kansas City ultimately? 

Skuli Gudmundsson: Okay, sure. As you say, I’m born and raised in Iceland. Had a great childhood, lived in a house where my grandparents lived upstairs. We lived downstairs. My grandpa was a physician and a phenomenal guy, and I spent more time with him than my own dad. Because he worked all the time, spoke seven languages, wrote seven or eight books, taught me how to play chess and cards and all that kind of stuff, so I had a great, upbringing. 

 I had the good fortune of working summers at a farm, my great uncle’s farm, from the time I was eight years old. Just to put it in context, My generation, if you weren’t working as a kid, you were by yourself. So, I was fortunate to be able to go on a farm and work there as a farm hand. And if the kids couldn’t go to a farm, they would, plant flowers and, cemeteries and do that kind of stuff. 

But everybody worked. That was the key, in 1955, my dad took a job with TWA in Iceland. this is during the time when the constellations, the Connies had to make a fuel stop on the North Atlantic. I did that for three years, and then the Jets came along and that became obsolete, basically. They offered him a job in Bangkok, Thailand, so off we went, halfway around the world. Those kids and my mom, my dad had already gone ahead. We couldn’t speak a word of English, but we were looking forward to the adventure. Interestingly, my grandparents spent a lot of time in Singapore, Java, and Sumatra. 

We were familiar with the region. Worked and went to school there, an international school. We started learning English and had a great time. It was a wonderful time to be a teenager in Bangkok, it was safe. I rode my little moped all over the city and just had a wonderful time. So, when the jets came along, the people that competed with TWA in the Bangkok market, brought 707. 

So that was Pan Am and Air India. TWA was still flying Constellation. Some people figured out no, that’s not for me anymore. They closed Bangkok and sent us, sent to him, gave him a job in Paris, working on the international staff. We went to a NATO school in Paris and had to start learning French. Wasn’t thrilled about that. We’d just gone through the English, exercise. Interestingly, I took a French class in high school in Bangkok, and I passed because my buddy’s mom was the teacher. Three months later, I’m living in France, saying, Oh my gosh, I should have paid attention.  

So, they closed Bangkok and we moved to Paris. Unfortunately, soon after we got there, my dad passed away. My mom and sisters went back to Iceland, and I stayed behind to finish high school. The college had to be put on hold. I was supposed to go to the Sorbonne, but those plans were scuttled because I had to go to work to support my mom and sisters. We decided after I graduated high school, I went to TWA and I said, Hey, do you guys have any work, any jobs? They said, Yes, we have one as a mail boy, pays 90 bucks a month. You can have it if you want it. So that’s where I started. I did that for a couple of months, and then they promoted me three or four times to a transportation agent because I spoke better English than most of the French guys, so I had to translate for the aircrews and, and those kinds of folks. It was a great career.  

We decided as a family that we would join up, and we decided we would immigrate. I went to a friend of my dad’s that worked at TWA in Paris. I said, we’re going to America, where should we go? I know there are cowboys in Arizona and gangsters in Chicago and that’s about it. He said, well I’m from Chicago, don’t go there. He said, my favorite city is San Francisco. So, I waited for a job opening to come up, come about. Came over here, interviewed, and got the job. I moved here in the mid-sixties. Worked in the land organization for about 12 years in San Francisco. Did all kinds of jobs working my way up the ladder, then I decided that I would have to wait a long time in San Francisco to get promoted because nobody left there. And I started to look for work in all corners of the country. All kinds of jobs. I applied to one at Breach Academy, which is the Waddell and Reed Training Center on, It was Shawnee Mission Parkway, I guess. 

They hired me to develop video training for ramp service people, the guys that load the bags. I did that for three years. I developed several safety videos and that led me to work closely with the safety organization in TWA. And they offered me a job as the Western Region Safety Manager, and I took that, and I was responsible basically for half of the country. 

Transferred to Los Angeles and worked there for two years. I came back to Kansas City and the beginning of ’81 as the director of safety and environmental protection for the airline. I did that for five years, and then I took a famous buyout and never looked back.  

Ethan Whitehill: Let’s pick up there then. You’ve had amazing life experiences. You had a tremendous corporate career, but you always had a dream of owning your own business, too and that became a reality. What led to that pivot? What gave you the courage to take that step?  

Skuli Gudmundsson: Well, I knew early on, I wanted to have my own business. I was an entrepreneur even as a kid. I used to charge kids to come watch soccer games in the backyard and I’d go buy candy and chop it into little pieces and sell it to them, you know. I was eight. But I didn’t know what it was going to be. And when I got into the safety and health, that made a huge difference, and I found my purpose to start a business centered on helping other people. 

That’s what I did. And how did the corporate career prepare you for that? You know, I was fortunate to work for a Fortune 500 company. And in those big companies, you have an opportunity to move around and move up and see people, learn from people, get lots and lots of training. And, A lot of opportunities that are not available in smaller companies, and I took full advantage of that. 

One of the things I did while I was there, I was, became the general chairman of the Air Transport Section of the National Safety Council. It was an organization that included every airline in the country and many internationally. We had, three meetings a year, one in this country and others in Hawaii and Europe and fun places. 

 And it helped build my… You know, my career, my confidence, my skill set, and so I took advantage of being in a Fortune 500 company where you can do those kinds of things.  

Ethan Whitehill: And you applied all of that to OCCU-TEC, and for those who, you know, who may not be aware, explain OCCU-TEC and, and the challenges you help clients with. 

Skuli Gudmundsson: We have three operating divisions, serve totally different clients in each one of those divisions, and We obviously help them in different ways. Our largest division now is what we call critical fuel systems. And in that division, we, inspect, maintain, and repair fuel systems for backup generators, primarily in the telecom industry. 

Some in healthcare, we’re getting more into that. But we have long term contracts with all the big telecoms, Verizon, Sprint, Frontier, and all. And we do that nationwide. For, for Verizon, for instance, we serve a 10-state area from here up to Canada over to Indiana. We have two guys based up there that inspect about 85 assets every month, for Verizon. 

We opened a Texas office, when we got a contract with Frontier Communications. And we do the same thing in Texas. We have people that travel the entire state, and that’s a huge state, on a monthly basis, and inspect and make sure the equipment is working as it should. Because the consequences of the equipment going down are significant. 

Ethan Whitehill: It’s not just me getting my Facebook. It’s emergency services and everything else.  

Skuli Gudmundsson: Exactly. Exactly. So that critical fuel system, allowed us to open an office in Texas, office in Indiana, office in North Carolina, and an office in Michigan. And we had, those are project offices, the Texas office is a full-service architect office. 

Our other services include environmental management, and in that group, we do a lot of, still do a lot of asbestos work, mold, indoor air quality, basically any environmental work within the fence line of a, of a property. We’ve done some pretty, Interesting projects here in town were a big part of the Union Station, renewal, or restoration. 

We managed what was called the contamination phase of that project. We managed up to six contractors at a time, removing lead, asbestos, mold, and other bad stuff. And that was, it was gratifying to have been involved in that and now see Union Station for what it is today. Did the same thing with Stowers Institute down by the plaza. 

 We were in charge of removing and managing the removal of asbestos from the old Menorah Hospital that was down there. And we did that. That took six, seven months, and then they started building a world renowned Stowers Institute. And we have lots of, examples like that, we do all the environmental work for the KCMO school district, UMKC, Hallmark Cards, and many other kind of household names in the city. 

Our third division is safety and training. We, that’s where we started. Traditional safety programs, we help people manage, employee safety, basically. Make sure that they’re doing the right things to make sure that people don’t get injured on the job, or impedes production, or… Slows the, the operation down, so. 

And we have done that in many different ways. We, for instance, for a period of 15 years, we managed the safety program for the state of Missouri, 66, 000 employees. And we had two guys working inside state government in the Office of Administration. And we managed, ran the program, saved them millions, millions of dollars. 

Now we have taken a model out of the Crux manual, and we’ve started a fractional safety, we call it mesh, and that’s starting to take off, we’re starting to market it now, and we have several clients and more in the wings, and we think there’s a real need for that, and just like you discovered, the traditional marketing model. 

Thank you. Firms don’t focus on that. Likewise, traditional safety companies don’t focus on that. They can come in and do anything they want. So, what we want to do is engage these people on a fractional basis and then stay with them over time and help them build their safety programs back up.  

Ethan Whitehill: Why should a company consider incorporating safety and health measures in business operations? 

Skuli Gudmundsson: The short word is, it’s good for business. Injuries are a tremendous cost for a business. And most people don’t realize it. Most management people don’t realize it. They’re uninformed about the impact it has on the organization. So, we have kind of a sweet spot of people who are Manufacturers, 200 and less, typically they don’t have their own safety people, don’t have environmental people, so we can come in and fill those functions on a, on a fractional basis and help them reduce the injuries. 

The injury rates drive your workers compensation costs. If you have an injury, your comp goes up. It’s no different than, than car insurance. If you have a bunch of, parking tickets and speeding tickets, well, they’re going to charge you more. The difference in the workers comp world is that once you have that injury, that experience stays on the books for three years. 

So even if you have no injuries, you’re still paying the penalty for having had that injury. And the money that people don’t understand, I just brought a simple example. The financial impact on a company for one employee having mental health, mental stress injury, which is talked about quite frequently in today’s environment. 

If the company is operating at a 5% profit, the cost of that injury is 73, 817. If they’re operating at a 5% profit margin, they would have to sell an additional 1. 46 million worth of product to pay for that injury. All of which is preventable. When we try to educate people and they finally go, Oh my gosh, I have no clue. 

Ethan Whitehill: I bet a lot of folks think too, Oh well that’s for regulated industries, That’s compliance with certain rules and regulations, But that doesn’t apply to my business, And that’s probably not true either, right?  

Skuli Gudmundsson: Yeah, they think well, we got a worker’s comp insurance, that’s, you know, we’re covered. 

No, you’re not covered. Part of its covered. The medical costs are covered and some others. But the indirect costs, the replacement of the employee, having to hire overtime to cover the cost, investigating the accident and all the administrative stuff that goes on, is over half of the total cost. There’s no insurance for that. That comes straight out of your pocket.  

Ethan Whitehill: Yeah, so you’re really selling prevention.  

Skuli Gudmundsson: Yes, absolutely. I’ve always said, we in this business are the only people that work on prevention. There are a lot of risk management people, and they try to mitigate the impact on the organization once a loss has happened. We try to prevent the loss from the beginning.  

Ethan Whitehill: And you’ve been doing a good job for a long time. Because OCCU-TEC, your history dates back to 1983. In fact, you’re celebrating a 40th anniversary. That’s correct. This year. And you’ve accomplished so much, and the company has grown continuously through that period. 

What do you credit that longevity to?  

Skuli Gudmundsson: Well, we have a what we call a consultant mindset. We think differently than a lot of other people who are more thinking technically. And what that means is, that was our, basically our background. So, what that means is when we go on a facility, and we’re hired to do a specific task, could be a changing of a valve or whatever, we spend time, or we look around the facility, and if we see something that needs management’s attention, we’ll bring it to them and say, Hey, this is an issue you guys need to look into. 

It’s going to create a problem down the road. Well, our clients… Really appreciate that. I’ve had a couple of people say, Oh, you’re just trying to sell more work. No, that’s not true. We’re trying to help our clients not become trapped in a situation where they have a bad failure or have to spend a lot of money to bring your equipment up to spec. 

So that has served us well. We, like to say, we never say never. We’re always open to new opportunities, and I’ll give you the example, of our critical fuel group. A big client came to us and said, we cannot keep our backup generators running, the fuel gets clogged up, the filters, clog up, and the fuel doesn’t flow to the, can you help us? 

Well, we’re consultants, of course we can. We hired a firm to teach us the ropes. Well, it’s not our biggest division. It would have been easy to say, oh, you know, we don’t do that. But we don’t think that way. We think, yes, we can do that. We can learn that, and we did, and we’re very good at it, and we are highly respected in the industry now, and, like I said, it’s our biggest division and growing every day. 

Loyal employees, that’s critical. I have one guy that’s been there over 30 years, one guy that’s been there over, 20 years and several that are in their teen years have very little turnover. We try to create a culture of inclusivity and fun and support and teamwork. And I think the results speak for themselves. 

Ethan Whitehill: I’m sure there have been pain points along the way. What are some of the examples of things that you’ve had to overcome in that history?  

Skuli Gudmundsson: Well, we had to overcome the start of a business, which is always hard. We didn’t gain our first client for probably… Six months. But fortunately, that was a big client turned out to be KU that hired us to do training manuals for the asbestos disciplines for the people that did the work in schools. 

So, we wrote all their manuals, and they hired us to teach that an Air Force contract did that all over the world, Asia, Europe, everywhere in this country that launched. We were in the right place at the right time and we said, heck yeah, we can do that. You start a business; you obviously don’t start a business with the idea that you’re not going to make it. 

So, you just have to develop this mindset that no, we’re going to work through this. And we did. And my wife was working at the time, we didn’t have kids, so that took a lot of pressure off. And then later on, you know, there are all kinds of things that happened. Recession was one, COVID was another. Not catastrophic stuff, but stuff we had to navigate through, and it wasn’t always easy. 

Ethan Whitehill: So, thinking about risks in, in running a business, that, that’s sort of the, the entrepreneurial road you’re going to face it. What strategies can other entrepreneurs employ to mitigate risk that you, you can share with them?  

Skuli Gudmundsson: Well, we all know the statistics related to startups. They’re pretty grim. A lot of people don’t make it past five years, as you all know. 

My advice is having a purpose for starting a business. Know what you’re going to do and why. I see lots of people that startup businesses and they’re not real clear of where they’re going. But you have to think through that. Do research on the demand for your goods and services. It’s not good enough to say, oh yeah, I’ll go out there and sell this stuff. 

Is there a market for this stuff? And research is so easy today. So do that ahead of time. Don’t underestimate the cash needs for the startup years. That’s critical. That’s where a lot of… Small businesses just don’t make it because they haven’t accounted for it, or they thought they were going to get business rolling sooner, and sometimes that happens. 

I said surround yourself with people and advisors that are smarter than you. You have to be a little thick-skinned and take some advice from people you may not always agree with, but you have to hear them out. They’re there to help you and you’d be foolish if you didn’t take that to heart as you know Hemp has the put your first worst foot forward mantra, So you have to be open and honest with people. 

I say establish strong banking relationships and Barnett helped I would say have more than one. Because he went through a rough time when he just had one. Seek appropriate legal advice and have a solid business plan. It is so easy today to find resources to build these things. I mean, back in our day, you just had to kind of make it up. 

Or write or read a book that was this thick. But now you can go online, and you can download, you can cut and paste and it’s… But don’t skip that. You have to have a plan because if you don’t have a plan, a strategy… for where you’re going, you’ll probably never get there. Yes, you adjust the plan along the way. 

Act accordingly, but you have to have a plan and a vision, and a goal. And that’s, that’s the entrepreneur or the leader’s job, is to have them create a vision and set it for the organization.  

Ethan Whitehill: Yeah, and that’s a great point. It can be kind of lonely sometimes as a leader, and you need to turn to other folks for guidance. 

You mentioned the Helzberg Entrepreneurial Mentoring Program as one of those resources. What should anybody running a company leading a business, be thinking about when it comes to guiding their own decisions.  

Skuli Gudmundsson: I think you have to have mentors. I’ve always had a mentor, even before my hemp days. 

I’ve always been involved in CEO roundtables, groups of 10 people get together, you know, once a month and talk about ideas. What problems are you having? How can we help you? It’s a support group, so to speak, you learn if you have an open mind. I hired a scaling-up coach here a few years ago to help kind of scale up the business. 

That’s based on the Rockefeller model. You may be familiar with that, or listeners. Did that for a couple of years. He set us on a pretty solid path, and we’re following that. And now, we have Crux we have a marketing arm of our company that we’ve never had before. We’ve had marketing people that were pretty much solo operators. And I had one a couple of years ago and that guy quit. We went back to ground zero. And that’s when I said, There’s got to be a better way. And I just saw, as you know, I saw your ad on the Business Journal website and called you up. Been doing this now for year and a half. 

Ethan Whitehill: And we’re thankful for that.  


Skuli Gudmundsson: are too. I mean, our marketing outreach, our statistics, our numbers are going through the roof. We’re now starting to seriously do some outbound marketing. We’re doing one for the state of Missouri has a requirement for all schools in the state to have the water tested. 

So, we’ve developed some webinars, we’ve had a bunch of outreach, and now we have several school districts that have hired us to do that, including Kansas City Middle School. And these are labor intensive and pretty complicated. This all came out of the Flint, Michigan, That, lead in schools and all that kind of stuff, so it’s mandated in the state of Missouri. 

The good news is, which a lot of people don’t know, but we do because we have close relations with the people in Jeff City, is that the state has set aside 27 million dollars to reimburse schools for doing the testing. So, that should be a pretty easy sale. You  

know, as we think about other resources that you could share with other folks who are listening. 

And maybe interested in launching a business or going through a tough time in their business. What else could you recommend? Seek  

help. There is so much help in this city that’s available for people who do some research, reach out and find out where the help is. We’ve all been around this city a long time and, and obviously the Helzberg Entrepreneurial Mentoring Program was one of those. 

Now it’s not for startups because you have to have been in business for three years and you have to have a million in revenue before you’re accepted into the program. But there are lots of other programs that focus more on startups and help with those infant steps at the beginning. But Hemp was wonderful for me. 

I was in the class of 2005, so I had three mentee years. I had Walt Rizalewski as my mentor, and the guy’s brilliant, and such a just a nice, nice man, and we’re good friends now. And, after three years, I stayed on as a fellow, and then I became, a chair of the paid forward committee, and that put me on the board for a few years, and it’s just a wonderful organization, but what I tell people, if you get in there, you’re exposed to a group of the business owner, probably 200 strong, that are more than willing to help you bend over backward, Give you resources, give you ideas, give you thoughts. It’s a little bit unknown how important and impactful that organization is.  

Ethan Whitehill: Now, Skuli, it’s time that we get off the point. And I’m going to ask you a totally random question. I have, my 20 questions that are determined by this 20-sided die I’m going to roll. And I rolled a 5. The question is, if you could only bring three things with you on a deserted island, what would you pick? 

Skuli Gudmundsson: Is a case of wine one or twelve? 

Ethan Whitehill: Yeah, we’ll call that one.  

Skuli Gudmundsson: What would I bring? A generator? Some communication equipment? And lots of sunscreen.  

Ethan Whitehill: Skuli, this has been fantastic. Thank you for spending time with us today on the show. If people want to learn more about OCCU-TEC, where do they find you? 

Skuli Gudmundsson: Online is OCCU-TEC. com, OCCU-TEC without the hyphen. Anybody would be happy to help you. I’ll give you my email address, because I love to help people and talk to people about business. It’s sgudmundsson@occutec.com — Feel free to reach out to me anytime.  

Ethan Whitehill: Awesome. Thank you, Skuli! 

Skuli Gudmundsson: You’re welcome.

Read More

View All Blogs