HATTIE: Hi. I'm Hattie Bryant. If you're curious about how business works and how money makes money, stay with us. Each week right here, you meet the owners of companies, and they tell you their secrets.
We call this a Master Class. There are no gurus, no professors and no teachers; only people who've done already what it is you want to do.
HATTIE: (Voiceover) John Solheim makes the putters that sing--or is that ping? This is the sound of innovation. The sound that shifted golf club design away from the conventional. The sound that built a beautiful business and all in the pursuit of perfection. You might guess this company makes Ping golf clubs. Karsten Manufacturing, the maker of Ping golf clubs, started in a garage in 1959. And even though it stayed there for seven years, today, the Phoenix-based company has nearly 900 employees working in 35 buildings on 30 acres, producing some of the world's most loved products.
TESTIMONIAL: And now the father of the finest golf clubs that have ever been made...
HATTIE: (Voiceover) Called the gentle genius, Karsten Solheim was the immigrant son of a shoemaker. As an engineer for General Electric, he invented the first television rabbit ears. He took up golf, but was frustrated because he believed he could apply the laws of physics and engineering to make a better club; one that would help every golfer do better and have more fun. Since his first putter design in 1959, he led the way for every golf manufacturer.
BOB HOPE: I know you've seen me play and that's why you don't give me a Ping putter.
HATTIE: (Voiceover) Karsten Solheim is the most widely copied club designer that golf has ever seen. At the age of 88, Karsten died, leaving a corporate culture safe in the hands of the son who worked beside him for 40 years.
JOHN SOLHEIM: When we started, I was in junior high, drilling putters in our garage. It took us a long time to get of our garage-- seven years -- and my dad really questioned leaving General Electric at the time. I was a teenager in high school, he would rap on my window--which was outside the garage--at 10:00 at night after I'd went to bed; that it was time to go to work. Wasn't always the funnest thing, but...
HATTIE: There's your dad saying, `I need you'? JOHN: Yes. HATTIE: `Wake up'?
JOHN: `Wake up.' He'd watch the news and then it was time for him to do some stuff in the shop. Let me tell you a little story. They built a grocery store about a mile away from us. All my friends went and applied for jobs as carry-outs. So I went and applied for a job with them. Well, my dad found out that I'd applied for a job, all of a sudden, he wasn't too happy. That's when I started getting paid. But my deal was I got $2.50 a putter that I built, but if I needed help, I had to pay for the help. So it kind of taught me how to be a businessman a little bit back then, right from the scratch because I had to figure out my own thing.
HATTIE: Everybody tries to figure out what makes an entrepreneur, what makes a great business leader, and frankly, we've seen, over the years, when someone sees a problem that they think they can solve, they start a business. Your father had trouble playing golf the first time he played, and he said, `What's wrong with this equipment? I could make it better.'
HATTIE: Was he always stretching to make it better?
JOHN: Always. Always.
HATTIE: Why couldn't he just use somebody else's putter and be happy with it?
JOHN: Well, because when he missed a putt, when the ball didn't go as straight as it could, he realized from the dynamics of the club. The weights weren't extreme -- if the weights are out there, it won't twist as much. He did some tests, and it twists half of what it did so that means the putt's twice as close as what you would have been. You've got a shorter putt to tap in, or maybe it might catch the edge of the hole.
But, that's one step.
It took him a long time because the public didn't accept his putters, and he had to look at what the public wanted and modify those putters so that they met their acceptance. And it still look a lot of time. But we were fortunate, too, because TV and golf came along at about the time that we were really starting to have some success on tour, and when all of a sudden, people saw people like Nicklaus and Player, Julius Boros and George Archer using these funny-looking putters--because they were different; they showed up on TV different -- people wondered, `What in the world are those?'
And, you know, Karsten also was smart enough to make sure we had our name and address on every putter, too.
HATTIE: (Voiceover) The innovators are often punished by the establishment, and this happened to Ping.
JOHN: We had problems, too, because at the same time, the United States Golf Association had outlawed all of our putters, except for one.
HATTIE: Because they thought there was some trick to it?
JOHN: Well, there was a bend at the base of the grip, which forced the head to come through square.
HATTIE: When the USGA said that, were you just heartbroken? I mean, here you'd been working all these years, 7, 10, 11 years...
HATTIE: You're going up against the establishment.
JOHN: That's really tough. Exactly. And fortunately, we came to a settlement with the USGA so that the golfers were the winners because they got to continue using the clubs, and we made some changes and minor adjustments to the clubs.
HATTIE: (Voiceover) A key strategy in making customers happy is making sure their clubs fit.
JOHN: We realized that we were out of touch with our customers. So we started thinking, `How can we get in touch with them?' And what we started doing is bringing our customers into our plant and giving them training, both on learning what we were about and club fitting.
HATTIE: (Voiceover) Jay Richie teaches the golf pros how to fit Ping clubs. So how is that you do this fitting because this is part of the secret of why people love your product, right?
JAY RICHIE: Right. It's extremely important for anybody, whether you're a high handicap golfer or a professional, to make sure you get componentry that actually fits your game.
HATTIE: So what measurements do you need? I'm not telling you my weight
JAY: Weight's the first thing we ask. It's very basic.
HATTIE: Come here, come here, come here.
JAY: OK. First of all, we just want to know--it's a basic chart here--if you're left-handed or right-handed.
JAY: So I'm going to come over here and I'm going to measure your wrist to floor. Our next step is exactly this--the dynamic portion, where I actually have to watch you swing...and see where you're marking on this tape. And I want you to hit down on that board.
HATTIE: Do I not need to be back further?
JAY: Bend your knees a little bit. You get wherever you feel comfortable. Remember, you're the beginner golfer.
HATTIE: And I'm going to know...
JAY: This is all going to come--yeah. And just hit down on that board.
HATTIE: How far back should I go?
JAY: As far as you feel comfortable. There you go.
HATTIE: I want to go--I'm afraid. I don't want to hit it. But you want me to hit it.
JAY: I want you to hit it. It won't hurt the board. There you go. Excellent. And all I'm trying to have you do is make a mark. You actually did a pretty good mark. We're going to talk a little bit more and make sure that you feel comfortable with all the componentry that we've actually recommended for you, the right shaft, the right loft, the right lie. And then we're going to do in the pro shop. We're going to call the customer service department at Ping and they're going to actually place the order on the computer and then the production department is actually going to make your set specifically for you with all the componentry that we've just fit you for. It's going to take two days to make. We're going to ship them to you and you'll be playing with those golf clubs within a week.
LARRY MAJOR: And what we do is take the accounts, we bring them into Phoenix...
HATTIE: (Voiceover) Larry Major runs the Ping education program.
LARRY: And we try to educate them in our philosophies, our designs and basically club fittings. (Voiceover) Because the more they're educated, the better off they can communicate and the chances of sales obviously are much better when we do that.
Unidentified Man #2: Ping has gone to the point of training us to be expert club fitters, so we can get our customers or our guests in a golf club that's suited for them so that they can play the game and enjoy it more.
HATTIE: You've been at Ping Golf for how many years?
BOB: Twenty years.
HATTIE: What is it about this organization that causes people to stay, because there are a lot of people who've been here a long time?
BOB: The Solheim family takes care of their people. They recognize people for their talents. When I joined the company, we didn't even have job descriptions. Karsten hired people for what he saw that they could do, and then he let them develop into their skills. And that's really an unusual company that permits that to happen.
HATTIE: So you feel like this is a place where if you get an idea, you can chase it down and make it happen.
BOB: Without question.
HATTIE: (Voiceover) Ed O'Brian keeps Karsten Manufacturing connected.
ED O'BRIAN: I was a golf professional working for a club owned by Ping, and I voiced my desire to leave the golf business, and John Solheim asked me if I'd like to come and work the Web--run the Web site.
HATTIE: Why is it, then, important for a small owner to give an inside person an opportunity to learn about this?
ED: I think it's very important. The company culture is what you're trying to project ... the personality of the company. You're trying to put it on the Web and I think only somebody who has an intimate knowledge of the company is in that position. If the company still decides to outsource it, they need to have a team of people at the company who work very closely to supervise it. All the flashy graphics, Java, and Flash in the world is not going to cut it if you're not getting your personality online.
HATTIE: How do you attract these folks?
DOROTHY GLICK: For the most part, by word of mouth.
HATTIE: Dorothy Glick is director of human resources.
DOROTHY: The company has a great reputation in how they treat employees once they're hired on. And because of that, it's kind of like family members refer friends or other family members, and it's just grown from there.
JOHN: Well, number one, you take of your people. You make sure that you pay them well, that you have a bonus plan for them, you have retirement plans and medical insurance. But then, you know, you give them a challenge, and that's much more important. You give them a job that they're responsible for.