One on One

With Michael Skrentney

MichaelSkrentny is currently president and part owner of Mystic Systems Technology Corp. (MSTC),a Scottsdale, Ariz.-based company that provides management software, access and alarmsystems to the self-storage industry. He has been with the company since 1991.

Inside Self-Storage caught up with Mr. Skrentney to discuss his unique history inthe self-storage industry, the development of MSTC as a company, the perceptionssurrounding the launch of its Account Manager program, and his insights on the future ofself-storage software. We are now pleased to present an interview with MichaelSkrentney...

Now that we know some of your background, what were some of your earlierpositions in the self-storage industry?

My first experience was as a manager for Shurgard Storage Centers in Washington state.That was in 1984 when Shurgard was raising capital through limited partnerships. I learneda lot from the experience because Shurgard was very focused on management and qualityservice. They were from the part of the country that brought us Microsoft and Nordstrom.They wanted to instill that kind of ownership mentality in their employees, and they werevery committed to education. They quickly promoted me to regional manager and relocated meto Phoenix, to develop what was then a new market for Shurgard--managing, acquiring andassisting in the development of new properties. At the time, all of the facilities undermy direction were computerized, and we used the MSTC Mini Manager as our system.

In 1987, I took a position as VP of operations with a relatively new up-and- comingcompany, Storage USA. They were in the business of developing high-quality storagefacilities and from the very start began positioning themselves to be one of the top threeoperators in the industry. I was impressed that such a small company could have such driveand focus. We were definitely the underdog, but there was no question in my mind that itwas only a matter of time before we reached our goal. We always approached things from thestandpoint of "Will this work now?" and "Will it still work with 100 or1000 sites?" Dean Jernigan was always willing to put the necessary resources towardany problem so that it could be solved in the best possible manner. Much of the groundworkwe laid in those days is still in place today.

When I came to work with MSTC, we also had an affiliate company, Arizona Mini StorageManagement, which managed the Storage Solutions facilities in Arizona. I was again VP ofoperations. I worked this position for several years while also working sales andmanagement at MSTC. Later, when I became president of MSTC, we made the companies moreindependent and autonomous so they could each focus on their particular business.

How has this helped you in your career at MSTC?

I am fortunate enough to have had experience on every level of self-storage management,from on-site management, to supervising facilities all across the country, to writing andimplementing policies for several major self-storage corporations. All the while I wasalso a customer of MSTC, so right from the start I was an outside advocate giving themsuggestions on how to make their products more meaningful for the managers, managementcompanies and owner/operators. Whenever we put something new into our program, we thinkabout how it affects the people in all of those positions. Several other key persons inour organization come from the background of self-storage management, so we definitelyhave that part of understanding the business down pat. In addition, I am able to apply thefundamentals of teamwork to taking ownership and commitment to quality service in how wedo business. They are the key elements of MSTC.

When computers first became available on the Macintosh platform, MSTC was oneof the first software vendors. Explain its history for us.

MSTC actually started working on products in the early 1980s. At that time, one of thefounders of MSTC, Tom Swanson, was an owner/operator in Tempe, Ariz., and had a desire tocomputerize his storage facility. He worked with some local people developing a productand then realized that this was something they could take to market; so, in 1984, MiniStorage Technology was in incorporated. Right from the start they had a customer-servicephilosophy, and were the first in the industry to offer 24-hour, 7-day-a-week,365-day-a-year technical support.

In those days you actually leased the program, the computer and even the computer desk.If something went wrong with the system, they literally shipped you a new computerovernight. It was an Apple computer with two floppy drives and no hard drive. Believe itor not, MSTC was able to actually run a management program and a gate-access system all onthat one computer, even when it was supposedly technically impossible. Granted, it didn'thave the level of sophistication that we expect from our programs now, but for its time itwas very innovative. At the time I was working for Shurgard and we had the MSTCgate-access systems also. I'll never forget the day that Millie Swanson came over to ourfacility in the heat of summer to troubleshoot a problem we were having with a keypad. Itwas well over a 110 degrees and there she was out in the middle of the sun on the hotasphalt with a long mop handle in her hand, trying to pull wires out to reconnect thekeypad. We took a Polaroid picture and she looked like Carol Burnett doing one of hercleaning lady comedy acts. I wonder where that photo is. That really stuck with me thatMSTC would go that far to serve its customers.

In the mid-'80s it became evident that the business world was moving from Apple toIBM-compatible computers and that DOS was here to stay. MSTC jumped on the DOS bandwagonin a big way and began the task of creating the Mini Manager II, which was a derivative ofthe Apple program but clearly better. At that point, they knew the shortcomings of theprevious system and what it needed to do to be at the forefront of technology for thismarketplace. When the program came to the market, people didn't want to lease theirsystems any more, so the approach was all sales. MSTC got out of the business of providingall the hardware and the desks, but stayed with the approach of offering a completesystem. Now, however, you could do more than just lease it, you could own a license to thesoftware. By the early-'90s, almost all Apple-based systems were converted to the DOSsystem. A very similar experience to what is occurring now with so many moving from DOS toWindows.

What significant changes have occurred to MSTC through the years, and how hasit impacted the marketplace?

MSTC has always been at the forefront of technology. In the early 1990s, MSTC was thefirst to conceptualize and implement an alarm system that could be retrofitted intoexisting facilities because it employed the use of wireless transmitting technology inconjunction with other hardwired devices. This system came with individual doortransmitters that could be wired to magnetic contacts or placed in passive infrareddevices that required literally no installation. This meant that alarms could be rentedout to customers who were willing to pay extra for them. Shortly afterwards, we developed16-channel multiplexers that could also be utilized in the system. This allowed the systemto be practical for new installations where all units were to be alarmed as well as forretrofits.

In 1995, my business associate, Kathy Trevillyan, and I also took over controllinginterest in MSTC. It was our goal to reorganize it into a company that still cared aboutquality products and customer service, but that could hold pace with the way the worlddoes business today. In 1996, we moved our offices and expanded our staff to help maintainconsistent levels of sales and technical support. We began business planning using outsideconsultants, such as George S. May International Co., to help us identify areas that mightneed work. We also felt that the world would be going over to the Windows platform and wewanted to be at the forefront of that effort with 32-bit technology. So we started theprocess of defining the specifications for what would later become Account Manager forWindows. It was important for us that we keep the good things about the DOS Mini ManagerII that made our company a success, but we wanted to stand on top and incorporate many ofthe things our customers had been telling us they wanted in a new system.

We began programming the Windows-based Security Manager in 1996 and Account Manager in1997. We were expecting to release them both by summer of 1998; however, softwaredevelopment is not an exact science and the process took longer than expected. Meanwhile,in 1998 our programming staff (which consisted of three family members) decided that theywere not happy with the direction of the company and they departed in October of 1998,leaving us with an incomplete program and some unhappy customers who were anxiouslyawaiting their new systems.

Recognizing the need to act quickly, we selected a software-development company thathad a great deal of Windows- and Internet-development experience, to outsource the actualprogramming of Account Manager. We decided to turn a negative into a positive, and I beganworking with them on a daily basis. This gave MSTC a great opportunity to take a freshlook at Account Manager and make it even better than initially conceptualized.

The only problem we encountered was timing. It became apparent to us that we had tostart over almost from scratch, and we were already late releasing Account Manager. So wedid everything we could to speed up the process. We had up to five people working 10- to24-hour days trying to accomplish the impossible. We learned an incredible amount duringthis process. All the while, many people in the industry were waiting to see us fail andspreading rumors that we were going out of business. Consequently, we released version 1.0of Account Manager a little prematurely. We thought people would be happier to see theproduct partially functioning and that they would have the patience to go through thecompletion process with us. We were wrong, and we then recalled the product and began amore controlled approach to releasing the software in the fall of 1999.

That's quite a story. It's easy to see how perceptions can be inaccurate. Arethere any thoughts you'd like to share with your captive audience?

We're here to stay! We've weathered a tough storm and come out stronger. It has made ustune into our customer base even more. After all, they have been frustrated; yet, we stuckin there day after day and listened to what they had to say so that we could be the best.We owe a debt of gratitude to thank all of our customers who have supported us and givenus the strength to persevere. It is our business and our pleasure to serve such excellentpeople.

Windows development tools are holding the floodgate open for software vendors.Do you feel this makes the buying decision more difficult? How has competition affectedyour business?

We program utilizing Microsoft Visual C++ development tools. It is possible to utilizeother development tools, but they do not all get the same result. Account Manager offersliterally thousands of options of how to do business. It takes a lot of programming(source code) to support that much flexibility. I find there are a lot of systems outthere, some of which are new to the marketplace, but few demonstrate the level ofexperience and depth of configuration that Account Manager has.

Just being "Account-based" makes its source code more complex than anythingelse. The word "account" as used in our system means that for each customer thatrents units at the site, we establish an account you can enter the customer contact,billing and identification information into. In addition, you can have multiple contactsand multiple units in the account. For each account in the system, you actually customizeall of your business practices so you can do business with them the way they wantyou to do business. We have over 15,000 programming hours in the system, and we plan tokeep going strong.

Lots of companies will put a Windows product out there. There aren't any real controlsin place to regulate software. That's one of the reasons why so many products come tomarket. Anyone can form a company, write a program, get a trade-show booth and anadvertisement, and claim to be an expert. It's difficult initially to tell them apart.They all appear to do the same basic functions. It's the flexibility to conform to how youdo business, the accountability of the system tracking controls, and the customer supportthat sets apart the better ones. I think you'll find that the more mature companies in theindustry understand this, and if you evaluate the products you'll see some significantdifferences.

Developing a reliable, proven product is not easy from what you've explained.Is your newest Windows property management product, the Account Manager, bug-free?

Microsoft has certainly demonstrated that no successful product is bug free. At anygiven time, any software system has a list of known issues. It is the responsibility ofthe software companies to minimize the potential risk of any bugs by thorough testing andto respond quickly to any that are identified. A software system with no bugs isessentially a dead system and will soon be obsolete. We maintain a list of issues in oursoftware, track the progress made on each issue, and then test the fixes prior toreleasing a new version. We have released a new version of Account Manager at least once aquarter and intend to continue to do so through the year 2000.

So "buyer beware"? What advice would you give to a first-time builderof self-storage who is shopping for automation products?

Since we lack the equivalency of Consumer Reports in our market, it is importantto educate yourself via seminars, publications, and relationships with management andconsulting companies, as well as with the vendors who supply you with the products. Talkto other operators and learn from their experiences as well.

"User-friendly" is a term so often heard in software marketing. Isthere truly such a thing as user-friendly software?

We decided that "user-friendly" means being compliant with Microsoft Windows.We designed our system to use all the standard menus, tool bars, wizards, task bars,properties sheets, drop lists and dialogue boxes you would see in a product developed byMicrosoft. In this way, the computer operator is half way there just by learning how touse Windows. We find that people who are Windows proficient find the system easy to use,and those who only know DOS get frustrated. Until they learn Windows, they will continueto be frustrated. We recommend that everyone using our system should take a basic Windowsclass to learn how to maneuver around, and then they can take one of our optional trainingcourses. In addition, our system has a very thorough online help system that will help theuser find just about anything they need to know about the system.

Internet technology is also another life-altering device in our society. Howhas MSTC applied Internet features in your business and in your products?

We use the Internet as our primary means of communication, even within our own company.In addition, we have created a website that allows our customers to easily contact us forsales inquiries, and support questions, and to make suggestions on product development.Several of our employees actually work from home several days a week and utilize theInternet almost exclusively to stay in touch. We utilize synchronization so they can logon and update their database to match the main one on our network. In the Account Manager,we utilize the Internet for corporate report transmittals and are expanding that toinclude credit-card processing and the mailing of customer invoices.

We also see the future as being one in which there will be a web-based approach toself-storage management software that will allow storage customers to check their balancesand history, make changes to their account and make online payments via the Internet. Froma corporate standpoint, the home office of multiple sites will actually maintain theserver and host the database that the sites will log on to as browsers. This will allowthe home office the ability to always have the most recent information at their fingertipsmaking call-center reservations, rate management, audit controls, report timeliness andmarketing decisions a snap.

What can this industry expect to see from your organization in the next threeto five years?

Our big emphasis over the next few years will be to continue to refine the AccountManager to meet the needs of the industry, to introduce our new security hardware line andto develop and release a web-based enterprise version of Account Manager. All the whileour focus will be to continue to improve our quality of customer service and to introduceinnovative and leading-edge solutions for the industry.