Connect Business Magazine

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Pamela J. Year

By • Jan 2010 • Category: Cover Story

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Business Person of the Year 2010 – Winner

Chief Executive Officer Pamela J. Year of $46 million Mankato-based nonprofit business leads 350 employees creating jobs for thousands of people with disabilities.

Photo by Kris Kathmann

Pamela J. Year verbally chisels out one point crystal clear: Mankato-based MRCI WorkSource is a $46 million private nonprofit business. It has never been nor will ever be a government agency. MRCI WorkSource’s 335 paid staff members create innovative employment programs for more than four thousand people with disabilities, including at least 700 currently in Mankato, 160 in New Ulm, 130 in Fairmont, 120 in Shakopee, and 100 each in Chaska and Rosemount.

Sure, business transacted with various governments accounts for a significant chunk of its $46 million annual budget. Governments have always been its biggest customers. But it also generates substantial sales income in its three thrift stores and through clients performing packaging and light assembly work—about $6 million last year—for customers such as Tony Downs Foods, Taylor Corporation, 3M, and Kraft New Ulm.

Year earned Greater Mankato Growth’s recent Hap Halligan award for her leadership contributions. She leads Greater Mankato’s fourth-largest employer, which is Minnesota’s largest provider of supported community- and center-based employment. She knows her industry inside and out—employment for people with disabilities—better than anyone in the nation.

She has been president of the Minnesota Rehabilitation Association, Minnesota Association of Community Rehabilitation Organizations, and Minnesota State University Alumni Association. She is a board director for ISJ-Mayo Hospital and Harry Meyering Center. She has been the Central U.S. Representative on the National Rehabilitation Association board, and a South Central Workforce Council and Mankato YWCA board director.

Ask her. It’s a business.

You will be retiring in six months.

Life ends in a hurry. It’s suddenly over, and you have to be satisfied with how you lived your life because you don’t get to do it over.

Have you been satisfied?

Yes. Yet I seemed to have been very unimaginative in my career. I came down the road a mile from the University to start an internship at MRCI. That was 40 years ago and here I am still today. People I meet say staying at the same place isn’t the norm anymore. When I came here, this was a really tiny place, with very few people. Most were young people like me. It’s not the same organization now. It has offered new challenges all along the way.

Was the budget then two or three million?

Oh, no. Three hundred thousand. I worked for the State of Minnesota a couple of years as a rehabilitation counselor before coming here and found that lonely work. I’m a very social person and was out on my own working a large area serving older people with blindness. I came here because it looked like fun.

We had eight Minnesota State University business professors choose you as our Connect Business Magazine Business Person of the Year 2010. This year’s crop, they said, was the best yet. What was your first response when learning about winning?

It was disbelief, frankly, and I had this overwhelming sense of gratitude. But I didn’t feel like I had earned it when comparing myself to the others. I’m very proud of this honor. It’s a wonderful conclusion to my career.

Why disbelief?

I don’t really think of myself as a businessperson. I’m not trained as one. I was trained and worked as a rehabilitation counselor. Yet I have been in the industry and MRCI 40 years and know better than anyone how this business works.

What I do is easy. After all these years, it’s instinctive for me to have an understanding of the industry. A number of people here over the years have taught me about business, about money, how you grow, and how you leverage what you have into more. I see myself more as an entrepreneur than a manager.

How so?

It’s been my job all these years to find opportunities for growth. My natural impulse is to grow. I worked for 28 years for an excellent manager and learned about business from him—Arnie Berg. He was wonderful, but cautious. I always thought I could do more—in terms of service, in order to diversify our business.

MRCI has become very successful. In the midst of this economic trouble, we are having a very good year and are stable. It’s because we have diversified. Our businesses are all service-oriented and involve helping people, but the income comes from very different funding streams and in very different ways.

Our experience over time is that one of our divisions is always in trouble and one is always doing well. The rest are in between. Diversification is our safety net. Over the last six years, we have grown from being a $30 million company to $46 million. Things are working well.

How many people do you employ—in the greater sense of the word?

That’s a hard question. We work with four thousand clients at some level every year. We also work with lots of people in county welfare-to-work programs. We have about 335 staff on hand overseeing everything. In addition, we have more than 700 clients in Mankato, 160 in New Ulm, 120 in Shakopee, 100 in Chaska, and about 120 in Rosemont. There also are about a thousand families we work with, largely from the metro area.

Do you believe a down economy affects your business more than other businesses?

No. It affects it in a number of ways and we haven’t completely felt the downturn yet. Our rates were cut 2.6 percent by the legislature last year in the per diem we charge for certain kinds of programs. It will be cut again, I’m guessing. Again, it didn’t affect our entire business because we have diversified. We had enough growth last year to accommodate the loss. We also do about $6 million annually in private sales to industry. We have been up until now going great guns with that, but that business is starting to erode.

For what reason?

Mechanization is one. Some companies have replaced our in-house handwork with machines. Not long ago, we lost a large part of one job because the company built a machine that can replace our handwork. It’s hard to fight with that. They are in business to do well.

And there is the pressure of work going to Mexico or China, and when it does, the packaging gets done there, too. We have had that happen. Yet sometimes the work comes back to the States—and therefore to us—when the company begins having issues with higher shipping costs and delays. This type of work is diminishing. We’re a packager and assembler; not a manufacturer. Our forte might be a new product a company wants tested and the company doesn’t want to spend to tool up themselves. We also handle well a rework project in which we repackage a product. The problem with this type work is that it’s not predictable.

In terms of your supported employment business, do some manufacturers use you primarily because they feel it’s the right things to do?

That certainly plays a part. Many employers believe having our people in their plants enriches the work environment. Their people grow and feel good from our presence. When hiring us makes economic sense, they are really happy doing it. But we don’t try selling our business on asking employers to help humanity. We sell economic benefits. It doesn’t help our clients in the long run—they need to be seen as productive people making a contribution. It’s not good for them to be seen as a charity. That angle doesn’t work in the long run.

With nearly all businesses following a massive layoff, the employees usually have the wherewithal to find other employment opportunities. In your case, the people working through MRCI—not the day-to-day staff, but your clients—usually don’t have that same wherewithal. How do you handle that sort of pressure?

It’s terribly hard. We’ve lost community jobs in all our locations last year. But now we are seeing an uptick. Staff members from the metro just yesterday were talking about their community work programs doing better.

We’re very full in the workshop here. When a client comes into one of our work programs, we try to make a commitment to giving them six hours of work a day. This is one reason we’re so successful—when your job goes away in the community or gets cut in half, you can come back into our workshop for work. However, that’s really hard to manage and we do get crowded in here during this recession. We’re trying to develop another training site within this building so those people coming in can be trained to do certain manufacturing jobs when work is available again and elsewhere.

The minimum wage has risen from $5.15 to $7.25 the last two years. Has that affected the people working through MRCI?

I don’t know that it has hurt much. There aren’t many lower-paying jobs available now, yet I don’t know how much of that might be related to a rising minimum wage.

Our clients often are the last ones hired and the first ones laid off. Frankly, that’s one thing we can solve for an employer. If you use our clients, we can help you manage a layoff. We’re a supported employment service, meaning we can take some responsibility for helping handle some layoffs.

The minimum wage helps our clients placed individually in community jobs. Those people by law have to get the minimum wage. The rise in minimum wage helps all over. Our wages paid in our in-house programs relate to the prevailing wage for the kind of work we’re doing in a particular area. Each year, we do a prevailing wage survey. When you raise the minimum wage, there isn’t an instant pull, but eventually that raise pulls the prevailing wage up, so all wages rise over time. We bid our work based on those prevailing wages.

A competitor, Lifeworks, entered your territory years ago. Did their presence make you change the way you do business?

Competition does improve your services. Our people work hard to attract and train clients. On an individual level, we care deeply about those two goals, and we’re often hurt if a client chooses someone else. Yet, I don’t know if we could handle providing any more services than what we do currently. We’re maxed out here in many of our programs. We worry about space.

We have one unique niche—we also serve people with really severe disabilities. We have a reputation for not turning people away, and not demitting people. We get most of the harder to serve people in addition to the rest of our population.

You addressed the Greater Mankato Young Professionals last January. What did you say to them? Did being there remind you of where you were forty years ago?

I had a wonderful time. I gave them some of my rules for the road, as I called them. The most important thing I said was that, frankly, your career choice has to be about more than money. It just has to be.

I’ve been successful at this, and might have been successful at something else. But for me, my career has been about building community and a work family—something more than money. This job is my life’s redemption. This is what my life has been about. If you’re young, and just want to make money, I don’t know what in the end you will have—other than money.

There is great purpose to our work. It’s about including everyone. If you could summarize what we do in two words, that’s what it would be—including everyone. We have a belief system that says everybody should have a piece of the action. Our work is about helping people become involved at work, in the community, and about having a good life.

If you spent a day here, it would be an incomparable experience. We have an amazing cast of characters. I will miss my interaction with our clients and staff. We’re a big family that has all these tussles, pressures, pulls, joys, and sorrows. The joys and sorrows sometimes are so raw and bare in our clients. As staff, we are touched by their lives.

Do you see many of your clients as perhaps being more genuine or authentic than other people?

Many of them I do—in a way. It would do them a disservice to generalize, but I experience that with many. This morning I went into the cafeteria. A woman was there who has been here almost as long as I have. She defies all convention, and insists on smoking and drinking lots of coffee, despite all attempts to alter those behaviors. She said to me this morning: “I’ve had three coffees and I’m flyin’.” (Laughter.) I had a little moment of joy sharing her exuberance and in her unwillingness to be controlled by our environment and us. I just experience people how they are, and they are genuine and wonderful.

It seems you are often caught in the middle. On the one hand, businesspeople usually are trained not to show their emotions, because if they do, they might offend a customer. Most can’t easily outwardly express their political, personal or religious beliefs. On the other hand, with your clients, you often see that raw authenticity.

I have very strong belief systems, for instance, but have learned to be careful in those areas. (Laughter.) We don’t talk about politics here except perhaps to despair about what the state government has done at times. We certainly don’t persist in promoting any particular worldview. That would really be a bad thing. But our humanity does get shared. We’re pretty open about our humanity, and, at some level, that sharing can be very intimate.

Our staff has meaning for me, too. I want to do something that makes a difference in communities and for families. This business is like a big puzzle that has to fit together. It needs to be good for us all.

You had a capital campaign going about a year ago, yet suspended it. What happened?

As I said earlier, we’re bumping up against our walls in terms of space. When we moved to this site 30 years ago, our budget was $3 million. Our back office staff is still scrunched into the space of a $3 million company. We’re now at $46 million. That’s a problem. We’re really struggling over where to put the people who run the place. We also need more and better space for additional clients. We need upgrades. We want to improve the safety of our bus loading and unloading.

We have many buses, and city buses load and unload here. Residential programs send cars here to pick up people. All our clients don’t come back here at day’s end, but it sure feels like it. (Laughter.) There are safety and convenience issues. Many of our clients are aging, and so am I. We need more space and more care in moving about.

Excuse me, but wouldn’t it be fair to say you all are aging?

(Laughter.) Yes. We have a large population of people that came to us from out-of-state hospitals years ago. There’s a bubble of older people here in Mankato. People with Down syndrome are living longer, for example, and some are retiring.

Can you describe the day when you had to make the decision not to go forward with your capital campaign for your building program?

It was apparent to everyone last January. We were asking too much of this community in a tough economic time. We felt it would be better to sit back, wait, and give it nine months or a year. We just met again and decided to wait a bit again.

We’ve not done a capital campaign like this before. It hasn’t been our nature to ask the community for financial support. As I said before, we try telling our community that the people working through us are worth including. They have productive value. If included, they can enrich a community rather than be a drain on resources. In a capital campaign, we will have to balance that out by saying, “Hey, with a little bit of help here, our clients can give the community back so much more.”

Aren’t you caught in a bind when advertising and promoting MRCI? On the one hand, you want the people you work with to be known in the community, and yet you don’t want to put them out there in a way that makes people feel sorry for them or for you to be seen as taking advantage of them to get money.

That’s a problem we have avoided like that plague. Last year’s annual report was a little controversial here internally. The theme of it was “Give me a Break.” It was about the people here who have disabilities who work, have unique personalities, make community contributions, and spend paychecks here. It was a wonderfully uplifting piece. I thought it showed the people that work through us in a positive light. They just need a break.

You retire this year. What is your succession plan?

We’ve been working on that plan feverishly the last couple of years. I made my intention to retire to our board months ago. We have a search committee. When this is published, we will be well on our way to making a decision on my replacement. We’ve been working the last several years internally with our senior management group on leadership, skill building, and total involvement within the organization. We don’t have any silos of knowledge.

We try to have a “hit by a bus” approach. If a bus hit me today, how many people would have trouble making a decision? Right now, the net effect on the organization might be zero. (Laughter.) Recently, I’ve been withdrawing myself from some decision-making. It seems at times as if nobody needs me or calls, which is a great compliment to our team. We all understand the philosophy of the company and what the other person does.

I’ve seen in some businesses that the person running it maintains total control up until the day they retire.

I understand that feeling. It’s painful to withdraw from a leadership position. I’m coaching people more now, rather than making decisions. I find myself saying, “If I were making the decision, this is what I might do.”

From what I hear you saying, do you feel there may be a tendency among some people in business to think of the business as their company—among those who are managers and not owners? Are there days when you have to check yourself and say, “Pam, this isn’t my company; this is theirs.”

Very much so. It’s not mine, In many ways that’s a relief. I’m ready to go. I’m pushing my staff to make decisions. Next year, we’re going to add on to our building, using our own funds. We just must do it. Given I’m leaving, I can get above the politics to see more clearly what will work. I’m not going to say no or yes; I’m only going to offer what I see as pitfalls or issues. It’s hard for me to give up control because I’m bossy.

Leadership in an organization is primarily about decisiveness—that’s the single most important aspect. That comes fairly easily for me. I’ve had a great deal of experience and know how things have played out in the past in terms of what works.

You have other income sources, such as MRCI Foundation. Is the Foundation beginning to benefit MRCI in terms of operating revenue?

Oh, yes. They’re giving us income as their endowment grows. They have a goal of reaching a million dollars in their endowment in the near future. They’ve been stymied perhaps by our lack of decisiveness about our capital campaign because the endowment campaign tied in with it.

One of the Foundation’s purposes is to help underwrite special projects.

A not-for-profit business is a hybrid. Doing what is right financially and doing what is right humanly speaking, at times are at cross-purposes. The Foundation supplies us with money sometimes to do things that don’t make economic sense.

Can you give an example?

I hesitate because I don’t want the people working in those programs to feel badly. But one we have struggled with—one that has been subsidized by our auxiliary and United Way—is our EASE Program. EASE stands for “Employment and Social Enrichment.” It’s a retirement program often for people who have worked for us for years and no longer have the intellectual or physical resources to be stimulated in retirement. It has about 35 people part-time. It now has an adult daycare license and has begun making inroads toward financial health. We’re committed to those people. We’d do this program regardless of its financial success because it’s important.

Other revenue streams are your thrift stores. You have quite a few competitors now in Mankato. Is the market oversaturated? Have your thrift stores taken a hit?

We have volunteers and staff there who are night and day focused on staying ahead of that happening. We just had the best October ever—$80,000 in sales alone in Mankato. New Ulm is doing well. It’s a much smaller operation totally operated by volunteers.

In a down economy, that is one industry that could thrive, but it seems every time we turn around another thrift store opens. In the last year, we opened a third thrift store, in North Mankato on Commerce Drive. It’s run entirely by our clients. It’s been successful in the sense we receive lots of donations from the Hilltop, which has helped both our stores. Taylor Corporation staff members have been especially supportive. We make our money doing volume. So we need donations.

Do you consider yourself a community leader?

We are a big business, and, from that perspective, I might be seen as a community leader. I was just presented with the Hap Halligan Leadership Award from Greater Mankato Growth. I try to participate where I can in the success of our community.

Do some businesspeople still think MRCI is a government entity rather than a private, nonprofit business?

Oh, yeah. I’ve answered that question hundreds of times, and sometimes to the same people again and again.

And some people, if they think MRCI is a government entity, won’t be too enamored with it.

Many people don’t have any idea what this business does or how complex and large it is. And how much of an economic impact it has on the community.

I do struggle when people pat me on the head and say how nice it is I’m helping “these” people. We have as complex a business as any in town. We have the same necessity to do well and make money. I also sometimes get pats on the head for being a woman.

Explain.

I feel it most from people over age 55. An example of when it bothers me? As a woman, I dislike people doing business at the golf course. This totally excludes me because I can’t play golf. And if I did, it simply wouldn’t happen because it wouldn’t feel appropriate. I can go to lunch, but even in that I have to watch the appropriateness of it. It’s all about how to work out that psycho-sexual-social relationship for a woman working among men. It’s just another dimension to be considered. Here at work, I don’t think about being a woman.

Do you think a man in private business running a $46 million company would think no way you could run it?

I’m sure some men would think that, and they might be right. (Laughter.) I couldn’t run their business, but likely, they couldn’t run MRCI. I have some concern about some people who think you can just slip your management skills into just any kind of organization. People that have been in for-profit industries haven’t done particularly well when transitioning into my industry. Running a business is a creative process.

You are married to Bill Bassett, former City of Mankato city manager. At night, when you talk, does he talk about what is going on in the city today?

Absolutely never. Absolutely never. Not from the first day. It’s like when we talked about this business not being mine. The city of Mankato was never his. He knew that, and never lost sight of it. This is a town that has a life of its own, and his attitude was you do the best in your stewardship of the town when you have the position.

So in your leaving, you could say he was a role model for you in how to leave a business?

Absolutely. I watched with some trepidation his leaving. He was so passionate and involved. That was more than ten years ago. He is never judgmental towards anything done now. And I hope that I can be that way, too. I want to be supportive of whoever is next in the business. I’m not going to be involved at all after leaving because I’m too strong, verbal, and persistent. I know I have to get the heck out of the way.

Often, people in my position in retirement go onto the board of directors or stay around in some way, but that would be a mistake. I’m helping the board in the selection process, because I know a lot of people and think I can save them a lot of trouble. But I’m not going to be the selector. It’s not about me. And that’s even hard.

Anything else?

I want the community to understand that MRCI is a contributing business. It isn’t just a social institution. Also, besides talking to the Young Professionals group, which I mentioned earlier, I also gave a talk in an MBA class at MSU this year. I talked about my approach, and that understanding people was the most important skill in business. You ought to read literature in order to understand how the world works—before you go to work. Shakespeare will tell you everything you need to know about people.

My father taught me to memorize poetry. One any given day, I can call up from memory a line that nails exactly how I’m feeling or a situation I’m in. It helps me stay centered and grounded. By my telephone, I have taped little sayings. One is, “I would rather be the man who bought the Brooklyn Bridge than the man who sold it.” It’s from Will Rogers. That reminds me I have to stay open and be willing to take risks with people. We get so cynical about the world. If our intentions stay open and pure, we win in the end.

Another very old saying I think about a lot: “In necessary things unity, in doubtful things freedom, in all things love.” Business can be all about love—loving the business, the people, the purpose. I think businesses can be like that. It can be about bringing beautiful products or services to a customer, about giving your life to make it better.

MRCI WorkSource Services

MRCI WorkSource has a number of options to help individuals find and keep employment, including: employment planning for people unsure of their abilities or job goals; employment development to help workers address individual work skill or behavior deficits; job placement services to help people obtain a job in the community; job coaching services to help people needing short-term assistance learning a job or adjusting to a new work environment; the Employment and Social Enrichment (EASE) program, for people in retirement working part-time; community-based employment ranging from light office and manufacturing to janitorial; center-based employment in packaging or light assembly for people in transition to a community job or those not choosing community work; Day Training and Habilitation (DT&H) for people with severe developmental disabilities receiving individualized service; an employment service network for people with mental illness needing help finding and keeping a job; employment and training services for Minnesota Family Investment Program (MFIP) recipients; and adult basic education and recreational opportunities for people with disabilities.

Getting to know you: Pamela J. Year

Born: April 15, 1945, in Hull, Iowa.

High School: Melvin, Iowa, 1963.

Spouse: William Bassett.

College: B.S. social services, Minnesota State, 1968; M.S. rehabilitation counseling, Minnesota State, 1971.

Professional Involvement: Minnesota Rehabilitation Association, past president; Minnesota Association of Community Rehabilitation Organizations, past president and legislative chair, current member; ISJ-Mayo Hospital board of directors, quality committee chair; Harry Meyering Center board of directors, past president; Minnesota State University Alumni Association former board director, past president; National Rehabilitation Association former board director; South Central Workforce Council, former board director; Mankato YWCA former board director; Mankato YWCA 1993 Woman of Distinction 1993 award recipient.

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