How a solid workplace ethic helped Dri-Eaz to the top

In October of 1970, a young high school dropout drove his aging car north out of Seattle on Interstate 5 and stopped in Mount Vernon. He had $35 in his pocket. He had a young wife and baby. His prospects were nonexistent.

Somehow, the young man stumbled across a landlord who was willing to trust that he would come up with the $115-a-month rent. The young man and his family were allowed to move into the house paying only $28 in advance. Then the young man managed to buy a carpet-cleaning machine on credit. The carpet cleaning game was kind of slow. But he broadened his opportunities by learning how to remove water from flooded buildings in a way that minimized damage. Then he learned how to make the machines that remove water from flooded buildings. Then he learned how to make them better. And better.

Meet Claude Blackburn, 50, president and chief executive officer of a $38 million-a-year company called Dri-Eaz, of Burlington. The company has emerged at the top of a growing industry called “restorative drying.” In fact, Blackburn pretty much invented the industry. Besides its offices, manufacturing facility and warehouses in Burlington, Dri-Eaz has warehousing in Nashville, Tennessee, and in a pleasant little suburb called Milton Keynes. That’s just outside London. That’s in England, which makes perfect sense if you are planning an assault on the European market.

The company has been quietly building the foundation for explosive growth while keeping a fairly low profile.

“We didn’t want to attract too much attention early on because some big company could come in and see that there’s money to be made and move in on our market,” he said.

But now Dri-Eaz owns that market. The company has had a number of overtures from potential buyers as well as some parties interested in taking Dri-Eaz public. Blackburn shrugs at the idea, but he is well aware of the minimum threshold for most companies go public — $50 million. At the current rate of Dri-Eaz’s growth that may not be long off.

Blackburn built his company on a combination of people skills, market savvy, common sense engineering and an ingenious approach to linking product sales with training programs aimed at helping his customers — mostly water removal contractors — be successful. He literally “wrote the book” on his industry. It’s title is “Carpet Cleaners’ Guide to Water Damage Restoration,” which was published in 1981.

In 1971, he founded Claude’s Carpet Care, a business that still bears that name in Sedro-Woolley even though he sold it years ago. As a carpet cleaner he began to get calls to help clean up water damage in apartments and homes. It was common those days to remove water-damaged carpets, dry them and then try to reinstall them in their original settings. Blackburn figured out a way to effectively dry carpets in place. It wasn’t long before his water removal business was bigger than his carpet cleaning enterprise.

One day in 1978, while putting furniture up on blocks in a home he was drying out, Blackburn ran out of wooden blocks. He looked around and found some Styrofoam that was left after the homeowner had opened a large package that had been delivered that day. He started cutting off chunks of the foam and using it in place of the wood blocks. It worked pretty well.

Thus was the inspiration for Easy Blocks. Blackburn sunk most of his life savings into a scheme to produce foam blocks according to specifications needed for the water damage restoration industry. It was the first Dri-Eaz product and it sold well enough to launch the company and show a nice profit for Blackburn.

It’s been a three-decade journey for the one-time carpet cleaner who now dominates the American market for water removal and restorative drying equipment — literally from rags to riches. You’d think he has a right to be just a little full of himself. But the 50-year-old, soft-spoken father of four takes his success with a grain of salt. He is quick to deflect attention from himself and to the team his company has built up to put Dri-Eaz, on the world map.

“One of the problems with entrepreneurs is that they’re too smart,” said Blackburn, meeting with a writer in the Burlington office that he spends little time in these days. “I never had that problem. They’re never as smart as three people.”

By that he means he is a big believer in team building, empowering employees to do their best work. Blackburn’s education did not end when he left Mountlake High School in the 10th grade. “I had social adjustment problems,” he said. He has been a voracious reader for most of his life. He reads much of the literature on management theory and is an admirer of the works of Stephen Covey, author of “The 7 Habits of Highly Effective People.”

“A good manager is a little bit lazy (delegates) and a little bit stupid (asks questions),” he said.

Through his reading and aggressive self-improvement programs that included Toastmasters, which dramatically improved his public speaking ability, Blackburn more than compensated for the lost years in academe. In fact, he is today no less articulate than your average MBA grad, but without the pretensions.

The company he has created along with his management team and line staff is growing at a dizzying pace. It’s not just that it has gone from net sales of $6.9 million in 1993 to $37.8 million in 2002. More than $10 million of that growth occurred in just one year, from 2001 to 2002. And sales have nearly doubled from the $19.8 million that was logged in 2000. The company employs between 150 and 160 people at its Burlington facility on Josh Wilson Road on Port of Skagit County property near the airport.

All the company’s stock is in the hands of Blackburn and his two oldest children. But when the company does well, employees can receive sizeable bonuses up to 16 percent of their salaries. Business has been so good that for the past eight quarters, Dri-Eaz has paid the maximum 16 percent bonuses to its workers.

As his company began to grow more rapidly in the early 1990s, Blackburn crossed paths with Dick Gillespie, a management consultant. He had once been employed at IBM and spent 30 consulting to firms like Weyerhaeuser and government agencies like the U.S. Forest Service. He is known in the industry as the founder of the “Work/Life Management System,” which he explains has the goal of helping employees find satisfaction both in their work lives as well as their personal lives. Blackburn, who had come to be a believer in employee development and empowerment, brought Gillespie in to run workshops for the company.

Blackburn and his management staff adapted the Gillespie programs to the needs of Dri-Eaz. And, Blackburn found, that Work/Life was quite consistent with his own philosophy of respecting and valuing employees. In 1995, when Blackburn decided to take his first vacation in years, he asked Gillespie to sit in for him as a temporary general manager. Upon his return, Blackburn noticed that the grounds had been cleaned and neatly trimmed.

As Gillespie recalls it, “Claude asked me how I got people to do things. I said, ‘I just go around and ask, can I help you?’” Gillespie had articulated an approach to management leadership that very much paralleled Blackburn’s own philosophy. The Gillespie gospel now permeates the company’s employee and customer relations policies. The company stresses values like “kindness, persuasion, patience, gentleness, discipline and integrity.”

By 1999, Blackburn felt the need to spend more time with his family, which included his wife, Mary, and four children. He decided to pull back from day-to-day management responsibilities and asked Gillespie to give up most of his outside consulting businesses and assume the oversight of the company, which he did. Today Gillespie, at 70, is company vice president, ramping down his hours and still doing some outside consulting while Matt Miller, director of operations, handles much of the day-to-day management oversight. However, Blackburn also has created a senior management team that he says needs little oversight. Department heads know their jobs and know how to communicate with their staffs. Blackburn says he is confident that the team he has in place can handle the next phase of the company’s growth.

In the American market for restorative drying equipment, Dri-Eaz has become both the dominant supplier of equipment, and has literally set the standard. Blackburn estimates that the company has achieved 70-80 percent market penetration in the U.S. That’s why Europe looms as the next territory for Dri-Eaz to conquer.

Dri-Eaz products are sold through thousands of distributors throughout the U.S. and Canada as well as some 20 countries outside of North America. The buyers are typically contractors specializing in water removal, often in connection with accidents or flooding that is covered by insurance. Blackburn says he has been able to show the insurance industry that his drying techniques can restore homes and their contents to virtually their original conditions for thousands of dollars less than replacing carpets, furniture, dry wall and other items soaked in water mishaps.

Dri-Eaz manufactures air movers, dehumidifiers, water removers, mold killers, and accessories. These machines are used for everything from drying out a flooded home or office to inflatable advertising (giant tires, beer cans, gorillas) and the inflatable bouncers for kids. For drying out a building there is the DrizAir 2400, which sells for $2,326, and can evaporate 18.5 gallons per day without damaging carpets, walls and furniture. An air mover (good for both blowing up your typical Macy’s parade gorilla and drying out a steamy, damp gymnasium) goes for anywhere from the low $200s up to nearly $500.

Ever alert to new applications for its technology, Dri-Eaz has even adapted its equipment for use in the pet grooming industry. The company considered that if it could dry out a house full of wet carpet, dogs should be a synch. Thus was created a new specialty dryer called “DriDog.” The company points out that by 1999 the number of pet grooming businesses advertising in all U.S. yellow pages was 21,000 and other data had found that there are 5,850 pet dogs and cats per pet grooming business. People may skimp on many things during hard times, but the company cites figures showing that in California, even during the extended recession the pet care industry hardly suffered. “Most pet owners think of their pets as ‘household members’ and for that reason they rarely cut back on grooming services,” Dri-Eaz marketing data reports.

Another key to the company’s manufacturing success is the care that goes into designing the molds for the plastic housings for the equipment. Blackburn, leading a tour of his plant, stops at a molding machine into which a worker injects the plastic grains. The company’s engineering and development group designs the tooling for the molds “from scratch,” he said.

“We have typically put about 2,000 man hours into the design of the tooling for a mold like that,” he said pointing to a device that will turn out the housing for one of the Dri-Eaz air movers. The care taken at the design level assures that the mold will work properly and for long stretches of time, thus reducing unit cost in the production cycle.

The one-time high school dropout has become not only a learned man, but an educator. In 1987, he wrote the Dri-Eaz Marketing Guide and developed a marketing seminar for the water damage restoration industry. He estimates that between 1987 and 1992 he presented the seminar to over 1,000 people.

By the early 1990s, Blackburn was acknowledged nationally as one of the nation’s leading experts on water damage restoration. He was chosen to chair the industry’s Water Damage Restoration Board. He was elected to the board of the largest trade organization of its type in North America — the Association of Specialists in Cleaning and Restoration. He wrote and published Restorative Drying, a 470-page manual on water damage restoration. In 1994, he developed the plan for the Restorative Drying Symposium, the largest gathering of restorative drying specialists in the world and was chosen by his peers as “Cleanfax Person of the Year.”

By 1997, Dri-Eaz sales were starting to skyrocket. Blackburn had already brought in Gillespie and his Work/Life program. Blackburn set out to make his company “a world class business.” In 1998, he led a strategic planning process for the company. He had set his sights on steering the company toward a new and almost stratospheric goal. He wanted to pattern Dri-Eaz after the criteria for the national Malcolm Baldridge National Quality Award.

It was a tall order, but Blackburn was determined to try. The “Baldridge criteria” became his bible. The Dri-Eaz Leadership Model was developed along those lines. It called for leaders “to deal with the followers in the same way that they would want to be treated.”

“I compiled this to help me practice leadership,” Blackburn wrote in the foreword to the statement. “It helps describe how honorable leaders attempt to influence people around them.”

Dri-Eaz “working guidelines” call upon “associates” to work at “being proactive by: increasing trust, building relationships, continuing my education, learning the mission statement, choosing my response in any situation, accepting responsibility for my behavior, using positive methods to deal with stress and eating properly and getting adequate exercise.”

Blackburn, himself, seems an embodiment of many of those principals. He creates the visitor with a warm smile and a handshake. He is only in the office for a few hours on the day of the visit. He is wearing a Hawaiian flower print shirt and looks almost too relaxed for a CEO. But the company now pretty much runs itself, based largely on the principles set forth in various mission statements and goals developed by Blackburn in concert with his management team.

Blackburn had just returned from a trip to Oak Ridge, Tennessee, where he had reviewed some water damage experiments conducted on a federal grant by scientists at Oak Ridge National Laboratory. The scientists were trying to determine effect ways of cleaning up water damage. They had never heard of Dri-Eaz or Claude Blackburn. But Blackburn came away with an agreement to let the experimenters try out some of his equipment, which he had little doubt would produce better results than what they had produced to date.

He leads the visitor into the training area of a large, adjacent warehouse. Inside the building, the company has built a large carpeted living room and kitchen area with linoleum flooring. The room is inundated with water so that trainees can get first hand experience with the equipment and study the Blackburn Bible for water damage restoration. Most of the sessions last four days and cost $900. Distributors provide somewhat less intensive training when they sell the machines to customers.

As Blackburn moves through his plant and offices, the affection of his employees is evident. In the sales office, he greets a young woman at the copying machine.

“Hey, I hear we had a record day yesterday,” he says.

“That’s right,” chirps the young woman. “It was our biggest single day of sales ever.”

Uninsulated pipes bursting during a cold snap in the Tenessee Valley drove sales to great heights. Blackburn grinned from ear to ear.