They share more than a first name.
Within the past year, Dan Luhring, 25, and Danny Kline, 35, took over the businesses their fathers founded – IssueTrak and Payday Payroll – at an age when most people haven’t climbed above middle management.
They operate on different turfs: IssueTrak, run by Luhring, is a software development company based in Town Center, with 41 employees and annual revenue topping $6 million. Payday Payroll, located in College Park Square, handles payroll processing or human resources for 1,400 clients and has a staff of 23.
But the sons have walked a common path: They’re harder-edged, more analytical, less sentimental than their fathers.
Or as Hank Luhring, 63, who started IssueTrak in 1992, put it: “I’m more empathetic; he’s better able to hold people accountable. I can sometimes get bogged down in details; he’s got a good sense of vision and an amazing ability to see what will work.”
They’ve won over their staffs by hard work and balance. They said they’ve held fast to the values embraced by their fathers – “we give employees rides home and to the hospital if they need it,” Dan Luhring said – while steering their companies in new directions to promote growth.
Today, IssueTrak will move from Town Center to a less trendy, but slightly larger, location on Kempsville Circle near Sentara Leigh Hospital in Norfolk. Dan Luhring estimates that will save about $100,000 a year, which can be used for technology or other benefits for workers.
“We’re a software company; we’re not a retail shop,” he said. “People are not coming here to dine.”
Payday Payroll is moving toward owning, rather than licensing, the software programs it uses, Danny Kline said: “You have to be in control of your own destiny. We can’t get there with our wagons hitched to these guys.”
The fathers have stayed active, but made clear their sons have the last word.
“I’ve reached the point on some of these things of saying, ‘You really don’t need to call me,’ ” said Andy Kline, who launched Payday in 1985.
But both sons still consult their fathers almost daily – Luhring usually calling his on the ride in to work. Danny Kline said, “I don’t think most people who are my age have the luxury of picking the brain of somebody who’s done it. Why wouldn’t I take advantage of that experience?”
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Dan Luhring did programming at IssueTrak when he was a student in the International Baccalaureate program at Princess Anne High School. But “I never had the expectation that Dad’s giving me this.” Nor did he think he’d want it. He envisioned a career twining his two loves – music and technology.
Luhring graduated from Virginia Tech in 2013 with a degree in music technology. He stayed in Blacksburg, working for a professor. Simultaneously, he did part-time work for IssueTrak, programming, advising his father, participating by phone in meetings. After one, Hank Luhring thought: “Oh my gosh. He’s really, really good at this.”
Dan came back, full-time, in April 2014. He took over, as CEO, in March. Hank has stayed on as interim sales manager, moving to a smaller office.
Only about 30 percent of family-owned businesses persist through the second generation, studies say. The reasons that figure isn’t higher include lack of interest or aptitude among adult children, as well as geographic distance, said William Donaldson, a lecturer in strategic planning at Christopher Newport University who advises family businesses such as IssueTrak on transitions.
Hank and Dan Luhring’s personalities, Donaldson said, helped ensure a smooth handoff: “Hank was willing to let go and be guided in that process and come up with a real plan and have the courage to follow through with it. Dan was competent to do it, passionate about doing it and not overly sensitive that he was unwilling to challenge his father.”
Hank on Dan: “He can come across to some people as a little bit of a know-it-all, but he’s always thinking: How can we do this better?… He’s more outgoing and does a good job talking to analysts. I never did like that part.”
Dan on Hank: “My dad is fairly laid-back, but I have more of a sense of urgency for stretching our goals…. He has more experience interacting with customers.”
Father and son said they were in sync on the move to Norfolk. They usually see eye-to-eye on big decisions – though Hank acknowledged hesitation about letting some workers go this year.
“Working with Dan – all of my preconceived notions about reporting to someone younger just dissolved,” said Sarah Spangler, 39, the firm’s marketing director. “He is so clear-headed and has really got a good grasp of the vision of the company and what our strategic direction is.”
She also praised him for increasing communication. Regarding the move, he held discussions to gauge staff reaction and led a tour of the Norfolk building during work hours, Spangler said: “Everyone seems really excited.”
Said Luhring: “You want to put a vision out there for a future that people want to walk towards. That’s what causes the follower effect.”
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Danny Kline, a graduate of George Mason University, was rising in management at Enterprise Rent-A-Car in Northern Virginia when his father called in 2006 to ask him to come back.
“I certainly didn’t want to sell the company, but I didn’t want to work as much anymore,” Andy Kline, 62, said.
Danny said yes before he hung up. He started on the bottom, as the lowest-paid payroll processor. After that, he got promoted to working with clients.
When Andy wanted to move him up to vice president in 2009, Danny asked him to hold off for a few months: “There were two people on staff who hadn’t converted yet” to accepting my leadership. “I needed to win them over.”
He essentially took over Payday in 2012, as his father began spending more time in Florida. It became official in May 2014, when Danny was named president.
Like the elder Luhring, Andy praised his son for boosting the quality of new hires.
“We’re looking for the smartest people we can find,” Danny said. “I don’t care if they’ve never done payroll. I can teach someone payroll much easier and quicker than how to be flexible in thought and open to change.”
Perhaps Andy’s only proviso: Maintain the firm’s deep civic involvement.
“We don’t just write checks,” he said. “We show up.”
Done. But Danny acknowledged he’s not the public speaker his father is: “He is far more charismatic than I am.” And a better joke-teller: “I can’t deliver jokes; that’s not in my wheelhouse.”
For his part, Andy said his son “has the most incredible logic and analytical skills. He can define the issues, the problems, the solutions.”
When they approach decisions, “we err on the side of being conservative,” Danny said. “We look at what’s best in the long run for the clients and the employees.”
They rarely differ on anything major.
“Sometimes we agree on the same path,” Danny said, “but the steps along the way are a little different.”
In those cases, they usually meet halfway. When Andy started outlining an example, Danny interjected: “Please don’t give too much detail.”
No worries. Andy was still beaming about his son.
“Danny,” he said later, “is driving us to new technology and new levels.”
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Both sons have struggled to shield their families from the pressures of running a business. At first, Dan Luhring was working 7-to-7 days, but he “got in trouble” with his wife. So he pared back to a 50-hour work week.
Danny Kline sometimes needs to vent, but he doesn’t want to bother his wife. So he goes to his father’s office.
“Don’t tell me how to fix it,” Kline tells his dad. “Just let me talk. Let me say my piece.”
And Andy Kline listens: “I just let him go on.”
