Shelf wealth: Deborah Schwarz started her career as a librarian without enough work to fill the day; now she's expanding her outsourcing service.

IT was 1997 when Deborah Schwarz got the call that changed her fife.

The Beverly Hills resident had been operating a low-key library staffing agency when Pillsbury Madison & Sutro LLP, the major San Francisco law firm, asked her to run its library as an outside contractor.

The agreement she reached with Pillsbury broke tradition in two hidebound industries--it even merited mention in the Wall Street Journal.

"We took over the entire operation," recalled Schwarz chief executive of Library Associates. "Then I began to think, if I did this I can do more."

Today, the Beverly Hills-based firm provides outsourcing, consulting and staffing services to more than 100 clients that include government agencies, hospitals, corporations and law firms. It is one of the few library outsourcing firms that's developed a national reputation, and the 49-year-old former librarian has ambitious plans for more.

Library Associates has made inroads in servicing "special libraries" made up of in-house corporate collections, law firm libraries and any others aside from public, school and university libraries.

After the firm got its contract with what is now Pillsbury Winthrop LLP, it began servicing other law firms. And in 1999 it made another breakthrough, winning a contract to run the library at the Torrance headquarters of Toyota Motor Corp.'s North American operations.

The two librarians there maintain the corporate archive, and respond to both employees' and external requests for information, among other functions.

Such growth has filed some in the profession because outsourced operations tend to run on the lean side and librarians are concerned that their jobs will become temporary instead of permanent.

"We know there is value (in what these firms do). We just wonder if there is long-term value there," said John Crosby, chief marketing strategist for the Special Libraries Association, a library trade group. "We believe that information professionals and librarians better serve an organization when they are part of the team."

Acquisition drive

Library Associates manages company reference materials on site. "Because we are a company that runs very lean, we had decided to outsource the archive function," said Ron Kirkpatrick, Toyota's national manager of company communications. "We can expand and contract as the need arises."

Meanwhile, Schwarz has been acquiring companies. In 2001, Library Associates bought Medical Library Consultants, which was performing similar outsourcing functions for hospitals that must maintain medical libraries to remain accredited. It now has contracts with 35 hospitals that include Good Samaritan Hospital near downtown Los Angeles.

Last fall, Schwarz took on an equity partner in buying the assets of a government information outsourcing firm called Sanad Support Technologies in Rockville, Md. The purchase doubled the company's size through contracts with the Department of Justice, where it staffs the main law library, the National Library of Medicine and 18 other agencies.

The firm has 135 librarians placed nationwide. Unlike a temp agency, they are on payroll. Employees with advanced degree librarians earn from $40,000 to $80,000 annually.

"We are a female-dominated profession, but Deb is a librarian herself. She is very conscious of keeping our salaries up," said Joyce Fedeczko, who has been working for Library Associates for two years and is director of information services at a BP Plc library in Naperville, Ill. "Outsourcing has gotten such bad press it's a dirty word, but I feel I can get a job anywhere."

Schwarz was a history major at the University of Michigan, but she decided to get her master's degree in library science in 1979 from the University of Toronto as a way into the publishing world.

She ended up moving with her first husband to Los Angeles, where she worked for several law firms as an in-house librarian. "I just found myself restless. I could get the whole job done in an hour, and now what I am going to do with my day?" she recalled.

In 1984 she and a colleague started a temporary staffing agency serving local law firms and public libraries. The partnership lasted only two years, but she carried on in 1986 with her own firm under the Library Associates name. "It was a living for me," she said. "I had two babies. I didn't put a whole lot of energy in."

That changed with the Pillsbury call, but there also have been larger forces at play. The growth of the Internet eliminated many clerical positions within libraries and put a premium on information specialists who are technically savvy and able to train others.

At the same time, companies have scaled back employment, while outsourcing picked up steam as the dominant corporate philosophy.

"There are not a lot of firms out there," said Linda McKell, who owns Advanced Information Management, a Hollister-based competitor to Library Associates.

There is also a shortage of librarians as fewer people go into the field, training programs close, and the existing workforce grays. Most major cities have one or two mom-and-pop library outsourcing companies serving them. Schwarz says her goal is to begin acquiring some of these firms.

"We are looking for more acquisition targets," she said.

PROFILE

Library Associates

Year Founded: 1986

Core Business: Library staffing and outsourcing

Revenues in 2002: $3.7 million

Revenues in 2003: $4.3 million

Employees in 2002: 75

Employees in 2003: 120

Goal: To acquire small library outsourcing firms around the country, establishing a wider national presence

Driving Force: Staffing libraries in an era of technological change, downsizing and outsourcing, despite a shortage of qualified personnel