CompHealth: honored in national competition.

• Position: The Utah healthcare employment agency is recognized by the Blue Chip Enterprise Initiative - Contains related article on applying for the Blue Chip Enterprise Initiative

COMPHEALTH Honored in National Competition

A business that grew from $7 million in annual sales to $55 million six years later would seem to be doing well. But for CompHealth, of Salt Lake City, which experienced this growth between 1985 and 1990, this proved to be a trying time. So impressive was the firm's handling of its problems, though, it recently was recognized as the top Utah designee in the national Blue Chip Enterprise Initiative.

Sponsored by Connecticut Mutual Life Insurance Co., and endorsed by the U.S. Chamber of Commerce, the Blue Chip Enterprise Initiative was launched in September of 1990 to help small businesses compete more effectively through the exchange of insights and strategies for success. By putting the designees' stories in printed and video forms so managers and owners nationwide can learn from them, the initiative hopes to improve the competitiveness of America's small businesses.

CompHealth is a prime example of a small business confronting and mastering many hurdles. The company is a temporary employment agency for physicians and healthcare professionals, the first of its kind in the nation and still, today, the largest. Begun in 1979, it initially had a narrow market focus. "We thought this would be a phenomenon of rural-practice family practitioners who needed to get away," recalled Tom Harrison, executive vice president.

Entering New Markets

Within 18 months, the firm realized a demand for its services beyond this target market. First came radiologists, then anesthetists, followed by other physicians, and finally non-physician healthcare professionals, including nurses and physical therapists.

Growth until the mid-1980s was strong, but the firm was operating only at breakeven. In 1985, management decided to buy the company via a leveraged buyout. This added $800,000 in debt, which had to be repaid within three years. The combination of debt and growth put a variety of strains on the company. "The challenge we faced was to keep the company growing, pay off the debt, and keep the quality of our service high," said Harrison.

The firm faced its problems creatively. Rapid company growth, increased diversification into related markets, and stricter state regulations regarding the granting of temporary physician licenses all combined to put severe strains on the firm's management structure. In response, CompHealth reorganized into specialty-specific teams.

The Team Approach

Each team focuses on a particular...