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Executive of the year.


It was more than 20 years ago when a young chartered accountant by the name of Bill Loewen, while employed at Ideal Brass Company, a Winnipeg-based furniture manufacturer, noticed that the data processing people refused to recognize that automated payrolls could be handled more efficiently and effectively by independent service bureaus. Computer program were long and unwieldy they said (this was 1967, remember), the number of forms and cheque requirements made payroll jobs too complex and most of the big payrolls in town were already well in hand. But Loewen's eye was not on the corporate giants; rather he saw great potential in smaller to medium-size payrolls.

He searched in vain for this type of company, but finding nothing to his liking (he turned down a few franchise opportunities in the accounting field), he devised his own computerized payroll system, launching it with the help of Fidelity Trust. "I approached various financial institutions about a payroll system in which all cheques would be drawn on one bank account," he recalls. "Fidelity Trust showed the greatest interest and agreed to help me with my proposal. Really, without their help and faith in me, I'm not sure I would have been able to get off the ground at all. They were invaluable to our efforts."

The key to the whole concept was the cheque--the ability to draw on one bank account maintained by the service company. Other service bureaus were preparing payroll cheques but they were drawn on each client's own bank account. Loewen's fresh approach increased the efficiency of computer operations since fewer forms and fewer transactions were necessary. Customers were also saved the tedious aspects of payroll management such as signing cheques and reconciling bank accounts.

In addition, the Comcheq concept produced greater financial efficiencies by buying cheques and forms in large quantities and providing clearing services for cheques. The net result was more service for less money. Comcheq made its money (the grand sum of $1,494 the first year) by levying a service charge for payroll preparation and by collecting interest on money that customers deposit in the company's payroll trust account.

That was over two decades ago. His entrepreneurial drive, astuteness and shrewd business decisions during these years have combined to make Comcheq Services Canada's largest independent payroll services company. Its customer base has grown from a modest four payrolls back in 1968 to more than 6,500 from 4,500 clients today. Annual revenue now approaches $24 million while the number of Comcheq offices across Canada totals 19. Employees now total over 450.

"We clear about nine million cheques a year," says the unpretentious, almost reticent Loewen. "We're probably the largest handler of cheques with a total payroll substantially larger than that of the federal government."

Never one to stand still for any length of time, Loewen has already laid the groundwork for what could well be the dawning of yet another era for Comcheq Services. Late last year, Comcheq made application to the superintendent of financial institutions in Ottawa for a bank or trust company charter. It's something he's been considering for some time: "It's been on our minds for quite a while. As a payroll services company, we've been competing with the banks for over 20 years. We feel the time is right to build our client base and become more of a full-service bureau."

Loewen says the company is taking this initiative largely because they handle close to $5 billion yearly through their trust account and have monthly balances in the range of $80 million at any one time. "There comes a point when you're handling that kind of money that a company should be regulated to the same extent as other financial institutions."

A charter would also provide Comcheq the opportunity to retain vast sums of payroll money longer and, in the process, increase its interest revenue. This, in turn, could result in dramatic growth within the organization. He says federal regulators are in the midst of drafting policy regarding deregulation within the industry so he is awaiting their suggestion as to what kind of charter would be best for Comcheq.

Although a decision regarding the application is not expected for several months, Loewen says it would be a milestone event in the company's history. "The public will undoubtedly view this as a major development in Comcheq's history," he says. "It will definitely play a big role in changing the image of the company and will help us grow much more quickly."

While the plan at present is to stay away from commercial loans and mortgages, he says Comcheq would want to have a retail presence and provide customers with personal chequing privileges.

With such an impressive array of accomplishments, one might get the impression that Bill Loewen's life has been full of frantic wheeling and dealing. But those that know this quiet and self-effacing man also know that comcheq's rise to national prominence has been due largely to Bill Loewen's judicious business manoeuvers and common sense approach devoid of the fanfare and fervor often associated with big business deals.

As others have pushed and swaggered their way into the business and socio-economic spotlight, Manitoba BUSINESS magazine's Executive of the Year has unobtrusively been leaving his indelible mark on the city of Winnipeg, the province of Manitoba, and indeed all of Canada for nearly 25 years. The very antithesis of the brash and bold wild west gunslinger, he's more like the quiet, yet forceful marshall--there whenever the need arises.

"Bill epitomizes what a quiet leader should be," says Harri Jansson, senior vice-president, commercial and corporate banking at the Bank of Montreal. "He stays in the background and usually avoids the spotlight, yet he is not hesitant to take a controversial stand and speak his mind on matters of importance. He is Mr. Integrity as far as I'm concerned--you can always take him at his word."

"He is very intense in everything he does or approaches," says nephew John Loewen, president and general manager of Comcheq Services. "Projects that he gets involved with are always very well thought out and he makes everyone around him work hard just to keep up with his thought process.

"Yet he is one of the fairest and most compassionate individuals I have ever known. He doesn't have to yell and scream to get your attention. You can tell he means business by the fire in his eyes."

As complimentary as his employees and associates are to him, Loewen is quick to credit those around him for his successes. "You need good people and you need to be able to keep them motivated and satisfied. For me, the more I've asked of people, the more they've given, and the more they've become involved in the growth of the company. Motivation also means participation and leading by example. If the person leading the company does not work hard, how can you expect the others to?

"Our senior managers work on a bonus system and there is a profit-sharing plan for all the employees. We've tried to keep all our staff involved and interested in their company even during the early years, when there were no profits to share in," he adds with a laugh.

Bill Loewen's vision and insight into business has been his long suit over these many years. Always thinking ahead, he realized, back in 1967, the potential of two significant technological developments. First, the use of large-scale computers was becoming more common and it was becoming easier to buy or lease them on time. Second, Common Business Oriented Language (COBOL) came into use and was ideally suited for the payroll industry. "COBOL allowed the transport of programs from computer to computer, thus making expansion to other computers and even other cities possible."

A founding director and past president of the Canadian Independent Computer Services Association, Loewen has long taken an active interest and role in the development and use of computers in the payroll services industry. Along with taking the lead in creating numerous innovations in the payroll processing field, Comcheq is also full or part owner of several related companies and divisions that make computer-based equipment or provide accounting services. Among the more prominent are: Time Terminals of Canada, which manufactures and markets the Electronic Time Card (ETC) and the XTENDER, a microprocessor that acts as an interface between the X.25 Datapac Network and most microcomputers; VoiSys, founded in 1987 to market the telephone response system developed by Comcheq; Electro Trac Circuits Division, which manufacturers printed circuit boards for the electronics industry; and Grassroots Information Services Limited, a wholly-owned subsidiary of Comcheq which is an on-line database providing information to business investors, prairie farmers and the general public. Services include stock and commodity prices, weather, news and home financial services.

While payroll preparation and related services are the cornerstones upon which Loewen built Comcheq, he has not been afraid to venture into deeper waters as they relate to other areas of personal financial services. Evidence is the development and evolution of the TouchPay Bill Payment Service division of the company. Loewen explains the genesis of this important milestone in the company's history: "During the latter part of the 1970s we could see that our business was being threatened by the direct deposit of payroll funds into personal bank accounts. We had to look in other directions to ensure our long-range future. One of the areas we wanted to explore was the possibility of becoming a full-scale financial institution which would encourage people to use us for their current account needs.

"We could not be a bank in the traditional sense, but it was apparent that electronics were changing and becoming an integral part of people's lives," he continues. "So we conceived a banking system that suited us and our customers--one that would allow people access to their pay cheques from home, work or at the mall." To complement the payroll and related financial services being offered, the enterprising Loewen introduced TouchPay, a telephone bill-paying service that enables the caller to pay all his bills with one simple phone call, thus eliminating the nuisance of cheques, stamps, lost envelopes and long line-ups. All that's needed is a membership, a chequing account and a free TouchPay membership and bill paying was never easier.

Simply put, TouchPay allows a person to pay his bills without ever leaving the comfort of his home. While the technology had been tried and proven in many business applications, Comcheq used its expertise in business computing and financial management to perfect the service for the home customer.

All a member needs do is phone the TouchPay line, quote his account number and reel off his payments. The cost is $0.50 for each bill paid. Considering that some financial institutions charge up to $0.35 per cheque written and that it now costs $0.39 for local mail, the $0.50 TouchPay charge can actually result in a saving. Plus, you get to save the time it would take running to the post office, the mailbox or the bank.

By Loewen's admission, the four-year-old system has been a bit slow in catching on, but he is optimistic that it has now turned the corner. Statistics bear this out: In January, 1988, there were just 200 users of the TouchPay system--at the end of 1989, the number was up to 1,200. In terms of monthly transactions, there were about 900 being processed in January, 1988, but that had climbed to nearly 5,000 by the end of last year.

One would think that with such an array of mind-boggling products and services, accounting and computers are something that Bill Loewen has been dreaming about since his childhood. "To tell you the truth, I had aspirations of studying physics and other science-related subjects," he says, recalling his high school days in Elkhorn, Manitoba. "But it was the late 1940s and money for university was hard to come by. I had heard about some CA courses that offered room and board along with the course, so a friend of mine and I decided to try it out and signed up as article students. So my career in accounting happened more by chance than by choice."

His first full-time job was with Canadian Propane Limited which took him both to Regina and Edmonton. He remained in oil and gas with Canadian Equipment Sales and Services in Edmonton, before returning to Manitoba in 1966 with Smith Carter Searle and Associates, Architects. A year later found him with Ideal Brass, but his career in the furniture manufacturing industry was short-lived, because the entrepreneurial bug hit him in 1968.

Over the years, Loewen has enjoyed a strong love affair with both the city of Winnipeg and Canada. One of this city's most vocal "cheerleaders," he has also been an outspoken critic of the Canada-U.S. Free Trade Agreement. Although he says the year-old agreement has had little or no direct impact on his business operations, he's quick to add that there has been a serious negative effect on employment in Canada which could have repercussions for Comcheq. "The payroll industry is fully dependent on people working and I feel the Free Trade Agreement has been hard on employment. Such trends are troublesome to us from a business standpoint and we are concerned about maintaining our level of growth.

"My concerns are that the east/west trade network is being diluted. It's not competition that worries me. I've competed head-on with the five major banks and the largest data-processing company in the world (IBM) for years and been successful. No successful business is threatened by free trade. We can all adapt. It's the impact that it will have on people that bothers me."

As chairman of a prominent national company Loewen, now in his 60th year, is taking a less active role in the day-to-day running of Comcheq Services. "My major involvement now is with the new services we're trying to introduce," he says, eschewing any thoughts of an early retirement. "While I try to delegate more responsibilities to our senior officers, Marv Taylor (Comcheq's Chief Executive Officer) and I continue to work on future opportunities for the company. His is in the area of new directions for our major accounts; mine is in the field of technology development."

Though he may be less involved in the company's daily activities, he still calls most of the shots, says nephew John: "From a strategy point of view he's still the key man. The company's success flows directly through him. If his plans and directions are followed through properly, everything tends to work out just fine. It's a true sign of his leadership."




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Title Annotation:Bill Loewen; includes a related article on his private life
Author:Bain, Don
Publication:Manitoba Business
Date:Apr 1, 1990
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