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Reinventing the Company Puts TCG on the Fast Track

Digital Library > Defining and Serving a Market > Product development “Reinventing the Company Puts TCG on the Fast Track”

Winning over a different market — and 1,109% growth.

During her first 10 years in business, Olga "Cookie" Mapula did not see herself as a fast-growth entrepreneur.

From 1986 to 1996, she was happy providing research and communication services to the public sector. She carved out a niche managing technical-assistance projects aimed at socio-economic development efforts in distressed, low-income communities along the U.S.-Mexico border.

By year-end 1995, her business generated more than $600,000 in annual sales. But as a federal contractor, she knew the government’s desire to decentralize its social-improvement programs and dole out money to the states would jeopardize her company’s survival. And that led her to rethink her business. "We analyzed market trends in light of the federal government’s new focus," says Mapula, president and CEO of El Paso-based TCG Inc. "We decided to diversify into information technology."

In early 1996, Mapula relaunched her company as TCG Inc. — changing its name from The Communications Group. She broadened the business from a research and communication firm reliant primarily on federal technical-assistance contracts to a reseller of computer hardware, software and support services. It soon became a systems integrator specializing in network technologies and training.

Winning the Right Client

As a Hispanic, Mapula bid for local contracts in her early years of business from a position of strength. She understood the concerns of the governmental officials and business leaders whom she sought to win over.

"It has been a real advantage," she says. "About 70% of the population is Hispanic in this area. All of my staff is bilingual. We can relate to the populations and communities we assist in this region."

But TCG’s first big technology client in 1996 didn’t select Mapula’s firm solely because of its minority-owned status. The White Sands Missile Range in nearby New Mexico wanted to contract with a company to install a new supercomputer, and one of Mapula’s employees was a tech-savvy engineer who had retired from White Sands a few years earlier.

"His contacts at White Sands and his technical expertise helped us get that contract," Mapula says. "And that led to more work, including installing the network backbone for White Sands’ new control center."

Her high-profile success with White Sands led to more contracts with local governments and businesses. By 1997, TCG’s annual revenues exceeded $4 million, a 1,109% increase in sales over five years.

Mapula chose the right time to revamp her business. In the mid-1990s, commercial demand for systems-integration expertise and computer training was beginning to boom. TCG rode the wave. The services that her company introduced in 1996 now represent 90% of total annual sales.

But four years ago, Mapula faced major risks. She bet that a range of clients — from federal agencies to municipalities to private-sector businesses — would pay for TCG’s fledgling information-technology services. She invested about a year’s worth of revenues to enter this arena.

Thanks to Mapula’s strong relationships with local banks, she secured favorable loans.

On the Right Path

With annual sales in excess of $8 million in 1999, TCG has continued its torrid growth. But Mapula’s business has not forsaken its roots. While most of its sales come from information technology, the company still provides research, particularly on minority health issues and technical-assistance services to help low-income communities. And it still retains some federal contracts.

"Now we’re mostly going after longer-term municipal and commercial-service contracts that are more stable," says Mapula. "Had we focused only on the low-margin, highly competitive computer hardware and software reselling business, we would have needed a heavy volume of orders to make money. But by adding quality support services, we could operate at much higher margins. Had we continued basically as a product reseller, we may have survived. But we wouldn’t have been able to grow," she explains.

Writer: Morey Stettner

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