Ralph Dandrea, CEO at ITX Corp
Lisa: Who influenced you deeply in your youth?
Ralph: I grew up in a very entrepreneurial family. My grandfather started several businesses, and my father eventually took over one of the larger ones. I grew up being around that business all the time. As a kid, I’d work for a dollar a day sorting wire nuts for my dad. In my entrepreneurial family, we enjoyed some big wins and suffered some big losses. Through it all, I learned that authentic relationships really matter.
My grandfather taught me so much about relationships. He could be a bit frugal, shall we say, mainly because he was born before the Depression. So he came of age at a time when people just didn’t waste a thing. But if someone needed something, my grandfather was always there. He would always work things out with people and always treated them fairly. I experienced firsthand the benefits of that once when shopping at an electronics store. I picked out a whole bunch of things and brought them up to the counter. The clerk writing up the slip asked me for my name. I told him, and he looked up at me and asked if I was related to my grandfather. When I said, “Yes, he’s my grandfather,” he replied, “Just take it.” Shocked, I said, “Well no, I haven’t paid for it.” He said, “Take anything you want. Your grandfather did so much for me. I can’t charge you. And tell him I said ‘hello.’” The fact that this man had such a high regard for my grandfather taught me a great deal about the impact he had made on others.
Relationships proved to be important to my father as well. Unfortunately, the business my dad took over went bankrupt in the early 80’s. After that, only three real friends stuck by him. People he considered friends disappeared and wouldn’t return his calls. His true friends continued to help him. One found him a job. Another brought him little things that he needed and was constantly encouraging him. I learned there aren’t as many authentic relationships during tough times. I’m glad I had my grandfather’s example, and also that my father had a few close friends to see him through some tough times.
Lisa: How did your father’s troubles affect you?
Ralph: Every failure teaches us something. I was a junior in high school when my dad’s business went bankrupt. My entire life, I thought my path was leading to the family business. Then all of a sudden, the family business was gone. So, I had to figure out what I wanted to do with my life. I witnessed my father go through a really tough time as a result of the embarrassment and the grief over failing his family and his father. Because of that, I had to figure out on my own what I was going to do and how I was going to pay for college. I worked full-time through my senior year in high school and worked two full-time jobs and a part-time job in the summer after high school.
I kept working while studying finance and economics at RIT (Rochester Institute of Technology), graduated in 3 years, and I sold my first business when I got out of college. I had one short stint working for a company but other than that I just started forging my own path and I’ve been an entrepreneur ever since.
Lisa: Were there mentors who also impacted you?
Ralph: One of my father’s true friends, Al Ferrini, became my mentor. Al never went to college, but he was super successful selling lights. He built a company and opened offices across New York State. When I started my next business, I ran it out of my parent’s basement. Al came over one day, saw me down there working, and said, “You know, you can’t do this to your parents.” So he gave me some office space he had available, and that’s how I got out of the house. If he had something I needed, he was always there for me.
Al also taught me an approach I still use today for reducing big, complex problems to something more manageable. He was great at distilling things down; that was his game. He would take any challenge and give it back to me in a single question. He never told me the answer. But his question would always guide me there. I hope to be like him someday. Al definitely influenced my leadership style.
Lisa: How did your family’s successes and failures shape the kind of entrepreneur you are today?
Ralph: I learned to be very thoughtful about the risks I take on. When you start a business, there really isn’t anything to lose except your investment. However, once your business is up and running, it’s a totally different experience because now you have something more to lose – especially if you’re personally guaranteeing the company’s debt. With personal guarantees, you just can’t hide behind bankruptcy; you can personally be bankrupted by something bad happening to the business. So I make sure that the risks I accept are properly priced, and I avoid risks that could result in large losses that I cannot sustain. It may sometimes cause me to pass up an opportunity, but it makes my business much more stable.
I believe that there are two types of entrepreneurs. There are the Jeff Bezos types that bet the family farm on something and win – big. But for every Jeff Bezos, there are tens of thousands of people who try, fail, and lose their entire family fortune. That’s not for me. I chose to be the kind of entrepreneur that gets familiar with a particular industry or service, creates a little corner of the universe, and mitigates as much risk as I can. One of the things I’ve learned along this path is that when you find a niche where you can reduce a specific type of risk for others, they are willing to pay you. Other companies pay ITX to be their partners and help to reduce their risk around their software products. We reduce the risk of not knowing what to do, of not knowing how to do it, of not staying current, the risk of building products that users don’t want.
Lisa: What advice would you give other entrepreneurs looking to accomplish what you have?
Ralph: I would say the number one thing is to do whatever you need to do to stay in business. I call it The Bluebird Theory. If you leave your window open long enough, a bluebird will fly in. If your window is not open, the bluebird will never find you. If you keep the business open and work hard, eventually something good comes in. “Keep the business open.” It sounds trite, but that’s how a lot of people become successful.
Second, know your limits. When I started ITX, as the sole employee, I had to do everything. But I quickly learned that I needed help. So I looked for people who could share the workload with me. Early on I didn’t look for people who were better than me. That was another learning; I realized that I needed people better than me if the business was to do great work and grow. Now, I am completely focused on trying to find people who can do the job far better than I and putting them in the right positions. Because I have capable people around me, I can focus on what I’m good at and what creates the most value for my client and for my company. I would say I spend the bulk of my time on developing our internal company environment. I focus on how we operate and how we do things, and then on teaching that to our team. That’s really my number one job.
Third, you’ve got to continue to get better. When I look back 5 years, I’m embarrassed about what the company was. And I hope that 5 years from now I’ll look back and be just as embarrassed. Because that’ll mean we’ve grown. If you look back 5 years and go, “Oh, that was great,” then you haven’t really moved. You haven’t evolved and haven’t gotten better.
Lisa: What has surprised you about the process of starting, leading, and growing a business?
Ralph: A positive surprise was the effect of momentum. Once you have positive momentum, good things seem to keep happening. Some of the things we do help momentum, others not so much. The fact that momentum existed as this force was a helpful concept for me to grasp. With momentum, ITX became its own entity at some point. When I started ITX, my values were ITX’s values, my interests were ITX’s interests, my mission was ITX’s mission. I simply wanted to find a steady diet of interesting things to work on. It wasn’t about making money, it wasn’t about changing the world. I’m a problem solver at heart. It was about solving interesting problems and minimizing risk for others.
Then, I started to hire great problem solvers. I never had any sales goals for the first 15 years. I just didn’t believe in that. It was more about having really cool things to work on. That was more important to me. But ITX became its own entity because the people who work at the company collectively make up the culture. We have evolved the interests, mission, and values beyond just my own. I’m really proud that we have a very high retention rate and we attract great talent. Great people are choosing to stay at ITX, which tells me we’re doing a good thing. I also like hearing that people enjoy the environment and the positive impact that we share with our clients. Those are the things that truly matter to me.
Lisa: In your opinion, what matters most in leadership?
Ralph: I think the most important thing is to have a wide variety of management and leadership styles available. That allows you to apply the right one to a given situation. Winston Churchill was limited in his “ways of being” as a leader, in that he knew only one style. This style was not quite as effective pre-war. During the war he was an amazing leader. After the war he went back to being less effective. He was the right guy for the job during the war, but after the war he couldn’t adapt. The needs of the job changed, and the needs of the British people changed. Evidently, that was outside the bounds of what his style could support.
It’s hard to find people who have a broad set of leadership capabilities. We all have our default styles but if we don’t have a lot of different “ways of being” available to us, we’re very limited in terms of the types of situations we can handle. For example, if someone is limited to the “field marshal” style of leadership, they can’t be successful in situations where the field marshal style of leadership isn’t effective. So, I have focused on trying to make more and more ways of being, or styles, available to me. I try to take time to pause and be thoughtful about which approach I’m taking in a given situation. I’ve learned to start with the current set of circumstances and then approach it with what I believe is the right way of being with that person relative to the situation. The actions and decisions just naturally happen, but first you have to choose the right way of being.
Lisa: What do you consider your greatest accomplishment?
Ralph: I’d say the environment we’ve created here at ITX. Throughout my career, I’ve learned so much – from my grandfather, my father, my mentor Al, clients, colleagues, and co-workers – that I now enjoy helping others think in new and different ways when they’re exposed to interesting challenges and problems to solve. It’s not about getting them to adopt my way of thinking, but offering them alternative ways to see a challenge and then watching them process through it. What’s even more exciting is when I see our team members here helping their teammates in the same way, using that method to help others transform and broaden their abilities. That’s part of our culture.
I want the confidence in knowing that ITX will survive in a post-Ralph world. It’s been a pleasure to contribute to the environment we have and to offer people a place to work and where they want to stay. Every year, I present annual length of service awards. That’s particularly exciting and gratifying. We also produce a yearbook every year that serves as our cultural artifact. In it we document all the great things we did that year for our clients, and there are terrific stories in there about our employees witnessing each other living the ITX values. It’s a way for us to catalog and celebrate our accomplishments. That’s all a big part of our environment, and I’m really proud of that.