I had the pleasure of interviewing Phil Friedman, president & CEO of CGS. He grew his business nearly 35 years ago from three people to more than 7,500 employees today.
Yitzi: Thank you so much for doing this with us Phil! What is your “backstory”?
You could say that my story begins in 1976. That was the year I arrived in the U.S. from the former Soviet Union, feeling confident about the opportunities that awaited me. I’d earned degrees in electrical engineering, economics and finance, but I soon realized that English skills would be crucial to my success in this new country. I went back to school to refine my English and to study technology, focusing specifically on data processing. I eventually secured a job at garment manufacturer Charles Greenberg & Sons, and that’s where it all began.
After about three years, I was running the entire IT department for Charles Greenberg & Sons. At the time, the company’s computer systems were very laborious and utilizing a lot of manpower to run successfully. I convinced Charles Greenberg & Sons to implement IBM System/38 and its ACS software, creating the first online computer system for the company. People came from far and wide to see this online system, and to ask for my advice. That’s when I had my “aha moment.”
I realized that I was spending a considerable amount of time giving out advice for free. I drafted a four-page business plan, gathered all my courage and I proposed a deal to the owners of Charles Greenberg & Sons: If the owners of the company would allow me to take five programmers and build a consulting service, I would commit to delivering the same quality of service to them for half the price. I didn’t realize it at the time, but this was the first outsourcing deal of my life. By some miracle, they believed in me enough to become partners with me and let me start another CGS: Computer Generated Solutions.
Yitzi: Can you share the funniest or most interesting story that happened to you since you began leading your company?
The most interesting story is about when to say “no.” Shortly after I began CGS, I received a call from Joel H. Newman, who was president of Calvin Klein at the time. I didn’t know who he was, but he had heard about me and my expertise with ACS software. He asked me to manage Calvin Klein’s IT operation, which would include overseeing the ACS implementation. It was a very appealing offer; Calvin Klein was growing its business and making money by the minute. For two days, I didn’t eat or sleep thinking about my decision. I came back 48 hours later and decided that I would not have the time or resources to grow my business if I accepted the initial six-month contract. It turned out to be the right decision. We were able to help Calvin Klein to implement the ACS ERP package, hire the staff and for several years we did consulting services that help the company grow. However, I could not abandon my goal to build my company. This interaction taught me to have confidence in myself and not lose sight of my long-term goals.
Yitzi: So, how exactly does your company help people?
CGS supports global enterprises, regional companies and government agencies with business applications, enterprise learning and outsourcing services to solve the fundamental business challenges they face. Our clients span across several industries including fashion, apparel, healthcare, hospitality as well as technology and telecoms.
We began with providing professional IT services and quickly expanded into Enterprise Resource Planning (ERP) software, and today we are the number one solution provider in the fashion and apparel market. Our BlueCherry® Enterprise Suite is recognized as the industry standard by providers throughout the fashion, manufacturing, distribution and retail industries.
When I started the company, I realized early on how important it was that the company didn’t just offer one product or service. By offering a variety of services — infrastructure, software services, enterprise learning and business process outsourcing — we are able to cross-sell our products and services as part of a unified solution. This is extremely beneficial for our customers, who see CGS as a partner in transforming their business operations versus a vendor that is selling a one-off product or service.
Yitzi: What do you think makes your company stand out? Can you share a story?
CGS is an international company that partners with its customers. We do not act as a vendor; we truly become a part of each of our customers’ organizations. And, when you realize the size of the company, it is quite amazing the broad range of services that we offer. As a partner to many global enterprises, I have always been proud of our employees — they are key to the reputation and the growth of CGS. Why we stress partnering with our customers is because they are our best asset in knowing what the industry needs. We have a ‘Customer Advisory Board’ that intimately knows our roadmap, helps shape future goals and adds value to our plans.
One of our outsourcing clients, which is a U.S.-based technology company with very complex application models, required a team with detailed knowledge of its brand sales process for an outbound tele-sales channel partner campaign to generate new clients. The client needed CGS agents, performing this tele-sales effort, to represent our client as a true extension of that client’s brand to the new customers. Our client requested the dedicated CGS team to be trained in a two-week period on multiple products for the outbound campaign that was launching in just four weeks. We sent a trainer and project manager from Romania to the client’s headquarters in San Francisco for two weeks to be exposed to the full spectrum of the client branding sales process and to gain deeper insight into the client sales teams, team leaders and trainers’ processes to replicate the methodology into CGS processes. The outcome was successful: CGS’s ability to complete the process and hiring in a two-week period allowed the client to initiate its program on time and within budget and has since realized 60% in new channel sales. Based on the initial results, the CIO expects to extend this program to larger scale global customers in the next 12 months to drive increased revenue for the company.
Yitzi: None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are?
I am not originally from the U.S. I born in the former Soviet Union and came of age in the Soviet military complex. For many years I worked for an entrepreneur who was not a conventional manager. He took a lot of risks; one of which was that he saw something in me and decided to take me under his wing. His name was Andre Koshik and he invited me to management meetings, allowing me to shadow him. He gave me an opportunity to learn how an entrepreneur works, thinks and makes decisions. He helped build my confidence. I didn’t realize at the time, but his style and leadership led to my mentoring others.
Yitzi: How have you used your success to bring goodness to the world?
I have had the opportunity to work with many wonderful organizations and leaders throughout my career. I serve as vice chairman for Yeshiva University, where I have established a scholarship fund, annually funding 10–15 students. From my work with Yeshiva, I have focused on mentoring our future leaders. At CGS, we offer internships annually for some of the brightest students studying at Yeshiva.
Additionally, I am proud to be on the executive board of the Tom Lantos Human Rights Institute. Tom, who was a former U.S. Congressman and my closest friend for over 20 years, was the Chairman of the House Foreign Affairs Committee. I traveled with him all over the world and met some of the most interesting and influential people. Tom was a person who I admired, learned from and considered to be a titan in government, foreign relations and human rights — fields that I have a major interest in. In November 2016, we inaugurated a statue of Tom Lantos, that I commissioned, in the city of Netanya, Israel, where one of the main streets is named after him and where we have our CGS office.
Yitzi: What are your “5 Things I Wish Someone Told Me Before I Became CEO” and why. (Please share a story or example for each.)
Despite what I know, I don’t think I would have changed a thing, but five tips that would have been useful:
Yitzi: Some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might just see this 🙂
I would love the opportunity to sit down with Jeff Bezos. I am fascinated by his innovation, vision and entrepreneurial spirit. He’s built a well-known and respected worldwide brand from scratch. When he founded the company 20 years ago, he didn’t have unlimited funding. In fact, he came from a very modest beginning and was just selling books. Yet he had the vision and foresight and executed on his plan. Today, Amazon is a leading Fortune 100 company. What he has done is nothing short of miraculous.