Former drill sergeant David Allen applies ‘For-Profit’ management to drive success
David Allen has mastered the science of proactive management.
Allen, president and CEO of Mississippi Blood Services (MBS), learned early in life to spot troubling trends as they take shape, and to make a move to emerge in an even better position. For starters, Allen, who was born in Charlotte, N.C., the third of four children in a family with a long legacy of dairy and tobacco farming, learned an enviable work ethic from his parents. From tossing newspapers on a route, to tending row crops on farms, to bagging food at the local grocery store, Allen worked his way through school.
His first major proactive step occurred toward the end of 1970, when the Vietnam War was raging and the draft was on. That December, six months before he was to graduate from Appalachian State University with degrees in economics and business, he learned about a training unit in Abingdon, Va., located across the mountain from the college town of Boone, N.C. This particular unit took over basic training companies on military posts throughout the South.
“That’s how I became a drill sergeant,” said Allen, who joined the U.S. Army Reserves and went on active duty after graduation.
After college, Allen joined Milliken & Company in South Carolina, one of America’s leading textile companies. For seven years, he juggled two very different roles simultaneously — plant superintendent in the fashion fabrics side of the business when double-knit leisure suits were popular and drill sergeant for the U.S. Army Reserves.
When a colleague left Milliken to join Frito Lay as vice president of human resources, Allen was approached about an opening in Frito-Lay’s plant in Jackson. “At first, I thought no way,” he said. “I’d never been to Mississippi and knew my wife’s mother would be unhappy with me if I moved Pam and our children from the Carolinas, but after a trip to Jackson, I was sold. We love it here. It’s home.”
During the decade Allen worked as controller for the Jackson plant, he became involved with Willowood Developmental Center — Frito-Lay would often host carnivals for the Willowood clients and staff. He joined Willowood’s board of directors and soon after, the board of directors for MBS, a not-for-profit organization that had resulted from a merger between Family Blood Assurance Program and Mississippi Regional Blood Center in 1978.
In 1987, the Mississippi Blood Services board approved the establishment of Blood Centers of America (BCA), a for-profit cooperative, with three other blood centers in Illinois, Iowa and Wisconsin. Each entity invested $25,000, primarily to leverage buying power for medical plastic products such as blood bags. “At that time, we were doing 40,000 units a year at MBS,” said Allen, who took over as MBS CEO in 1988. “All four blood centers were doing about 300,000 units, and we got a much better price collectively.”
Today, BCA, headquartered in Providence, R.I., which Allen chairs, has grown to $400 million with 16 owners; another 23 blood centers use its services. “It’s not only enhanced our buying power, but impacts every discipline within the blood center operations,” he said. “From recruitment and hospital services to compliance and quality, each has its own networking conferences annually to share best practices and discuss improvements and industry issues.”
Allen has taken some ribbing from making the jump from double-knits to potato chips to blood, but, he explained, “it all takes dedication and the discipline I learned from my military service which has proven very valuable. The management skills needed to run a business are the same whether it’s textiles, food, healthcare or any other industry.”
MBS has grown from a small operation located in a former A&P grocery store on Lakeland Drive (now the Rainbow Food Cooperative), to a nearly 200-person staff pushing $30 million in annual revenue in the former Ethan Allen furniture store located on the Hinds County side of Pearl River. In early 2011, MBS will move into a new 52,000-square-foot facility located on the Rankin County side of Lakeland Drive.
“I came from a for-profit background,” Allen said. “That’s how I run this business. We’re not the typical not-for-profit. If we were a private corporation, we’d probably be ranked among Mississippi’s top 60 in volume.”
Quoting Confucius, Allen said, “If you find something you love to do, you’ll never work a day in your life.”
“That’s how I truly feel,” he said. “I love working with our terrific staff, supportive board and truly love the mission at MBS.”
Several proactive moves have facilitated MBS’ growth. Following the success of BCA, a group of blood center executives gathered to discuss the volatility of professional liability premiums. Commercial insurance companies concerned about the advent of HIV/AIDs in the late 1980s had begun boosting premiums erratically. “We understand our business a lot better than a conventional insurance carrier,” said Allen.
The result: the formation of the risk retention group, Blood Centers’ Exchange (BCx). “We’ve done phenomenally well,” said Allen. “Other insurance companies’ rates have fluctuated while ours have remained very stable. All of the blood center owners work together well to make BCx a success.”
MBS has been involved with the formation of yet another company — which Allen chairs — as a result of a technology problem debated in 2005. Allen and six blood center executives had been using the same operating system software for several years and were trying to figure out ways to improve its effectiveness. Together, they created I.T. Synergistics LLC, affectionately called “ITSy.” Last December, the group saw immediate, significant cost-savings after acquiring and enhancing the software. “Instead of vendors telling us what will be in the next release,” he said, “we make decisions about what’s needed.”
ITSy recently began selling the software outside their circle. “There are only 100 or so blood centers across the country and four software vendors,” he said. “We’re the only one owned by blood centers, so there’s been a lot of interest. We like our prospects for future growth.”
Tackling another industry challenge, MBS and two blood centers in Wisconsin and Texas are establishing a company devoted to RFID (radio frequency identification) technology as a more efficient and safer way to keep up with the blood supply in blood centers and hospitals. “We’ve been working on this project for several years, and we’re excited about the possibilities,” said Allen. “The Blood Center of Wisconsin is taking the lead on it, and within the next couple of years, we hope to have a product to start offering to other blood centers and hospitals.”
Allen has also been proactive in community involvement, particularly with his role as vice chairman for Mississippians for Economic Progress (Lex Taylor of Louisville is chairman), the organization that fights for tort reform. “MBS was being sued for accidents that we didn’t cause — yet we happened to have insurance and were located in Hinds County — during the time when Mississippi was dead last for frivolous lawsuits filings … and it just wasn’t right,” he said. “It was costing us tens of thousands defending ourselves — a not-for-profit — plus time tied up with depositions and discovery. Something had to be done. I’m very proud of what we’ve accomplished over the years, but there’s still work to be done.”
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