By Micheal Carmichael
May/June 2011
When you head a global company that was founded in 1870, you could be tempted to rest on your laurels. That’s not Stephen Polk’s approach.
Polk is the great-grandson of Ralph Lane Polk, the producer of the Polk City Directories - a 19th-century print combination of YP.com, Yelp and Google.
The idea of having a directory for a city wasn’t even necessary until the population became large enough so that a visitor couldn’t simply ask the local innkeeper or town crier where so-and-so lived or where a breeches maker might be found. Once the first one in America had been published in Philadelphia in the late 1700s, directories began to be commonplace, eventually spreading to smaller and smaller towns. Gathering the information for a directory required men (it wasn’t considered a ladylike occupation) to go to each house and business much as a census taker would - but directories were often published each year instead of every 10, and the population during the early years was often mobile.
[SYSTEM-ADLEFT]Ralph Lane Polk (The Founder, as Stephen refers to him) had been a musician in the Civil War. Even though he had been born in Bellefontaine, Ohio, he went to school at the Pennington seminary, then a Methodist college preparatory school in New Jersey, and enlisted with a New Jersey regiment on Valentine’s Day in 1865. “After he was mustered out in July of 1865 at Hall’s Hill, Va., right outside Washington, he began to travel,” says Stephen Polk.
“He discovered someone who was making directories so he worked on a directory crew and learned the business. He ended up in Detroit and decided to publish a directory on his own. That was in 1870. He rode the train between Detroit and Chicago, collected the names of all the businesses at the train stops, then created a small publication that he sold to salespeople who rode the train and sold to those businesses along the way.”
The “small publication” was printed by James E. Scripps. “The story that was told to me by my father,” says Polk, “was that he actually got in trouble for printing the directory on one of the presses owned by the company he was working for at the time. That led to him leaving and setting up the Detroit Evening News.” Scripps’ sister later married George Booth and together they founded the Cranbrook Educational Community - for which Stephen Polk, more than a hundred years later, now serves as a trustee.
The first Polk City Directory was in, as Stephen Polk recalls, “Evansville, Ind. It was a little town not too far away that needed a directory. He took the opportunity, and that was the beginning. From there he acquired a number of directory businesses and, by 1900, we were publishing pretty much nationwide. We were probably the largest directory publisher in the world because there weren’t telephone books yet.”
In Stephen Polk’s office is an early Detroit city directory, and he explains that the company has an almost-complete collection of those. But, Polk says, “I always wished from a ‘string-collector’s’ point of view that we could have kept books from all over the country. There were just too many of them because we were publishing more than a thousand a year.”
By then, despite other publishers still in business, “Polk City Directory” had become the generic name for the genre - the resource turned to by the post office, delivery folks and process servers because it was comprehensive and accurate.
R.L. Polk is now known solely as Polk, and Stephen is the fifth Polk (a brother died in a boating accident) to run the company. “It’s certainly a fabulous asset to have a family business,” he says, and cites Ford Motor Co. as an example of a fourth-generation successor. “The complexities for those businesses were greatly magnified by the number of people down the line who became descendents of the founders. My father was an only child and his father was an only child, so at least from a family succession plan we’ve eliminated a lot of the roadblocks that typically derail family businesses along the way.
“Having a business model that works,” Polk says, is another reason for the success of the 141-year-old company. “I can say today we’re still founded on the same principles that we were founded on in the 1870s. We’re still an information company. When you think of the ebbs and flows of businesses around the world, information is one of the constants. So our core competency then is still vital. We say that we provide the information that helps businesses make good decisions - so that’s a fundamental that still survives.”
Embracing technology is another key to the company’s longevity, he says.
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“My great-grandfather had a great vision. He also implemented new technologies along the way. That has continued as almost another core competency. My father adopted computers to handle information as a resource before most businesses had even thought about it. We were using IBM mainframe serial number 1. We would write programs on cards here in Detroit that then had to be taken to Chicago to an IBM technology center because that was the only machine on which they could be read. That was back in the ’50s,” Polk explains.
“The focus of our business today, which is 100 percent focused around the automotive industry, is an example of serendipity as far as Polk is concerned,” he continues. “We were an information company that happened to be located in Detroit. Alfred Sloan (longtime president and chairman of General Motors Corp.) knew my grandfather socially. He challenged him and said, ‘If you’re collecting these millions of names of people in directories, I wish you could tell me how many cars Henry Ford is selling - because he lies to me whenever I ask him.'”
Grandpa Polk then bought a company called Iowa Motor List. “Because we had our national directories, that’s how we found them in Des Moines,” Polk explains. “That was the foundation of collecting automobile registrations, which became the basis for our national vehicle census, first published in 1922.
“The directory business has gone away. We don’t print directories any more. Automotive information is essential now to what we do globally. We’re all about technology and innovation. It’s all part of the game.”
Technology and innovation came together in the 1950s with Polk’s adoption of computers and the development of the vehicle identification number or VIN.
“We had a gentleman who worked for us,” explains Polk, “and we lent him to one of the government agencies that was developing the schema that was behind the VIN. A lot of the brainpower that went into what the VIN represented - the coding elements, the 17-digit standardization that went into it - we had a lot of input and influence into.
“There were always serial numbers,” Polk continues. “What the VIN really did was standardize and code information in the specific characters. It talks about the country where the vehicle was manufactured, the engine, the model year, the plant - all defined within certain positions of the VIN. It’s not only unique to the car, it also tells you something more about the car.”
Although the VIN was introduced in 1954 and gradually spread in some variant around the world, Polk has a 1969 Volkswagen “that just has a serial number. It doesn’t have a U.S. VIN even though it was sold here. If I went to Volkswagen they probably have somewhere in their files the attributes of that car, but with the VIN those attributes would be embedded in the vehicle itself.”
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Fireplace Moves with Business
When the founder died on a business trip to Iowa in 1923, his old office on Detroit’s Howard Street was dedicated as a memorial to him. In the ’60s, Stephen Polk’s father needed to move to another building because he needed additional space. The memorial room was torn down and the fireplace was to be relocated to his dad’s new office. In order to do that, Polk recalls, they disassembled the fireplace and crated it - and moved it to be stored temporarily in a barn on a farm the family owned in Metamora. In 1988, Polk was finally going to clean out the barn after his father’s death in 1984. “I found these boxes,” he says, “and I couldn’t figure out what in the world the stuff was. I asked my mom and she said it was the old fireplace. We had to move out of our previous locations because we again needed more space, so from the barn in Metamora it was reconstructed in Brewery Park (on Detroit’s riverfront, the former home of Stroh’s Beer). Fortunately, we had found the photo so we had something to go on. No one’s ever had the courage to plug the logs in, so we don’t know if they’re supposed to glow red or just give off heat.” Photo by Rosh Sillars |
Even without a standardized global VIN, Polk is able to keep track of just about every vehicle sold throughout the world. “There’s still a lot of information around the vehicle that we keep track of,” Polk says.
The 17 characters in the VIN were originally thought to be sufficient to handle production for a number of years. “But,” Polk explains, “they have actually come to the point where they have to repurpose VINs of older vehicles that have fallen off the system so they can be applied to new ones. There’s enough flexibility, though, to last us a few more years.”
Using the VINs and other data, Polk is able not only to keep track of essentially every vehicle produced and sold in this country but also predict when those vehicles will be replaced - and by whom and for what - whether it’s the same brand, a different type of vehicle, perhaps a different brand.
“It’s really looking at information,” says Polk. “Having lots of information at hand and helping clients make good decisions. What can they use that information to do? So we try to look at the analytics and then make predictions based on the data.
“One of the things we (are) keenly focused on right now,” he continues, “is our loyalty practice. That’s taking a look not just at when or where a vehicle gets sold, but the pattern of vehicle purchases in households. We can’t identify individuals to our customers, but we can talk about (how) loyalty is shifting in a broad set of customers, which is very important. So by tracking that and accumulating predictions on where people are likely to go, we’re able to help clients make good decisions.”
During the early days of GM, Sloan created what was called “the ladder of success” - the natural progression of buyers from Chevrolet to Pontiac to Oldsmobile to Buick and ultimately to Cadillac. When GM recently closed not only Oldsmobile and Hummer but also then Pontiac and its newest offering, Saturn, Polk says, “That’s a very significant disruption. One of the things you can do with loyalty patterns is predict where Saturn buyers are likely to be going next - and what potentially can influence those buyers. It could be advertising and product design or communications to then-current owners to try to encourage them to stay loyal. The same could be true for conquest buyers - what kinds of things influence their decisions. That’s all part of what our loyalty practice would be looking at.
“We have a lot of experience,” Polk says proudly, “and we’re very good.”
More than 10 years ago, Polk entered the consumer world with its purchase of CARFAX, a service to used-car buyers that alerts them about potential problems that could be uncovered by knowing the entire history of their proposed purchase - another thing Polk is very good at.
“CARFAX is a product that is built on the information we’ve been accumulating anyway,” Polk says. “It’s a wonderful brand, built around automotive data that fit very well with data we’ve accumulated for our own purposes. It’s the only product we have that’s designed for consumers.”
Polk has also partnered with Comcast Spotlight - a cable-based feature that targets consumers with commercials that are designed to appeal to their demographic group.
“Essentially, what we’re doing with Comcast,” Polk explains, “is using a statistical overlay on the communities where they’re servicing their customer base, allowing them to differentiate neighborhoods for the types of cars being acquired in those neighborhoods. They can then better pinpoint their sales groups to sell in local community advertisements to match the neighborhood buying patterns.”
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Can Comcast then target so effectively that an empty-nester household gets one commercial while the family with three kids under 10 across the street gets a different commercial?
“There are privacy concerns,” Polk explains, “that prohibit us from identifying specific household attributes. What it does do is allow us to lump groups of people into certain categories. Comcast has the ability, using other information they have, to differentiate what buying patterns there might be and what you might be interested in. So, you’re not targeted as individuals, but as groups.
“I’m very concerned about people’s privacy,” he repeats for emphasis.
Polk has just consolidated its southeast Michigan operations into a suburban office tower in Southfield that has a newly constructed glass staircase carved out of the center of the building, a staircase Polk takes regularly instead of an elevator.
One thing that marks the building as the “official” headquarters of Polk is a character-filled fireplace that’s prominently located on the top floor of the building. It’s no longer as tall as it once was because over the years - as it’s been moved from the original Polk offices in downtown Detroit to other locations throughout the area - it has been shortened to accommodate lower ceilings. Hanging over the mantle is a photograph of two generations of Polks admiring a portrait of The Founder. Custom-designed Pewabic tile lines the firebox and hearth, and a set of very early electric logs completes the installation. The only thing that seems to have changed are the andirons.
“Oh,” says Polk, looking more closely at the photograph. “I think I have those in my home,” he says with a laugh. He lives in the home his grandfather built and which is now on the National Register of Historic Places.
“When you look at the move to a new headquarters facility like this,” Polk says, “it’s a great environment for our people. It’s made us rethink how we look at our entire product offering. By investing in our core business in a lot of substantial ways to make sure we’ve got that right, we also want to make sure we grow that business in some new directions. We want to make sure we meet customer needs that are five to 10 years out.”
