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The Early Years of NAID

What follows is the first of a three-part series about my recollection of the years leading up to, and shortly after, NAID’s founding. Keep in mind, the idea to start an industry association began more than 21 years ago and some of its roots go back further still. NAID’s history involves many influential people so their stories will be intertwined with mine throughout this article. Whatever success NAID has had over the years is the direct result of contributions from hundreds of industry leaders that have given their time and talent and the thousands of industry professionals who have supported it over the years.

NAID’s story begins in the 1980s when I served as the business development manager for Certified Document Destruction (CDD), a new subsidiary of my grandfather’s business near Toledo, Ohio. My uncle, Ken Hagan, who was the president, deserves credit for starting CDD. When he learned that records destruction was proving to be viable business elsewhere, he immediately saw how the existing infrastructure of my grandfather’s company could be applied to the secure destruction industry. It proved to be a great decision for the family business and extremely fortunate for me. We quickly expanded the business to a second facility in Rochester, N.Y., where I eventually relocated.

While I spent much of the first part of my career driving trucks and loading boxes of records, early success at CDD soon allowed me to concentrate full time on growing the business. I spent the better part of the 1980s constantly hearing from prospective customers that they didn’t need my services, all the while knowing they actually did. I once calculated that I was told “we don’t need that service” or something similar more than 10,000 times during those years. Sometimes I wonder whether my desire to create NAID and commit to my career was to prove I was right to those who dismissed me all those years.

Thirty years ago outsourcing secure destruction services was not exactly a mainstream practice. Back then competition did not come from other secure destruction companies. Competition came from the wastebasket, the recycler, and sometimes the charlatan. In reality, NAID’s competition was and is ignorance. Like many of my peers at the time, which was relatively few, I desperately needed a third-party validation for what we were offering like a strong, industry advocacy organization.

When I initially struck out on my own, shortly before the family business was sold in 1991, I was a consultant. As such, I was either helping someone get started in the secure destruction business or helping them improve what they were already doing. Business was good. As a result of all this networking, however, the idea of an industry trade association strengthened and solidified. It was during an engagement with a company in Phoenix, Ariz., in June 1992 that I finally decided to act. It may sound a bit corny but I still remember stepping off the curb at 24th Street and Camelback Road on the way to have lunch as being the moment when I decided to go for it. Ironically, that corner is only short distance from NAID’s current headquarters. Upon returning from lunch that afternoon 21 years ago, I reached out to seven people – six who were to owners of secure destruction services and one who was an equipment manufacturer.

Determining who could belong to this new association was a little more complicated. Most of the people in the room represented destruction services, meaning they were not any other related businesses such as paper recycling or records storage. And, at the time, there were many paper recycling companies and records storage companies who the group felt were engaging in disreputable practices. Many records storage companies sold destruction services but did not have destruction equipment. They usually outsourced the destruction, often to recyclers with no security or destruction equipment, and rarely with any transparency regarding the fact that they were subcontracting the destruction.

Many wastepaper recyclers offered destruction services, rarely with any attendant security and without destruction equipment. As a result, initially some expressed the opinion that the association should only represent dedicated destruction operations — those not affiliated with records storage or recycling operations. However, there was a major problem with that approach. It ignored the fact that some recyclers and records storage companies were running reputable, ethical and transparent destruction operations.

Obviously, it would not be fair or in the interest of the industry to keep them out.

Ultimately, the group unanimously agreed that voting membership would be limited to businesses that provided secure destruction services directly, requiring the provider to actually possess the equipment necessary to perform the primary destruction services they offered.

A vendor membership category was also created, which is very common in other trade associations, and allows companies offering products and services to businesses in the industry to be involved and support their customers. Eventually, these categories would be labeled “active” members (i.e., service providers) and “associate” members (i.e., vendors), but that would come a year later when the bylaws were written. A few years later, a “franchise” member category would be added to limit the influence of a large voting population created by multiple franchise operations, and an “individual” membership to allow professionals who hire destruction companies to stay informed about industry issues.

It also deserves mentioning that issues such as private versus public ownership and mobile versus plant-based operations did not enter into the discussion whatsoever. Simply, there were no public companies in the secure destruction industry at the time. None of the major records and information management companies had a significant presence in the industry, at least not as direct service providers. On the second issue, mobile destruction services were still very new, with only a handful of operators that had negligible impact on the industry. Luckily, the structure created during the founding of NAID seamlessly integrated these two issues, making it easy to incorporate e-destruction more than a decade later as well.

The third agenda item, picking a name for the new association, took the most time of all. It is impossible to recall all of the suggestions but most revolved around the word “shredding.” I recalled ideas like the “National Records Destruction Association” and “Security Shredding Association of America” and similar variations being bandied about. We probably had 10 prospective names on the whiteboard when we broke for lunch, none of which that were generating much support. After lunch, we started fresh with the simple question, “What business are we in?” We are in the security shredding business, right? Or, are we in the records destruction
business? Or maybe it’s really the secure data disposal industry.

Ultimately, we agreed that we were in the information destruction business and, after what was probably two more hours, the group arrived at the “National Association for Information Destruction” (a.k.a., “NAID”).

It is hard to calculate how fortuitous this decision has been for the association. First, it has allowed members to fully expand the association’s influence into all information destruction issues and arenas, regardless of the process or media type. Think of how different it would have been had we agreed to use the “National
Paper Shredding Association,” which I believe was one of the early choices. An interesting point to note is that at the time of the name selection, there was never any consideration about NAID becoming an international organization. Now, about 30% of NAID membership is outside of the U.S. When NAID board members asked European members if they wanted to change the name to better suit their region, they said NAID represented more than just the words and decided to keep it. It is a thought-provoking name, almost Orwellian as a Wall Street Journal article called it a decade later. People hear it and they have to stop and think about it. For lack of a better way to put it, the name sticks. Even the acronym “NAID” has proven to be memorable and unique over the years.

With the name agreed upon, each participating company committed $200 each for NAID initiatives. Besides Bartel’s $500 for the Las Vegas meeting room, that money was the only money used to found NAID. Next, Kopelman took on the job of drafting bylaws. As luck would have it, Kopelman had an associate who was a retired attorney who had specialized in association management. Before going forward, however, we decided to get more buy-in from likeminded business owners. Because I was more heavily networked than the others and less occupied at the time, I took on the responsibility to reach out to like-minded organizations.

Fortune Smiled

It is hard to overstate the importance of that first meeting or the luck of having such committed, conscientious, ethical and visionary industry professionals at that table. On another day, it could have easily been four or five different people at the table. Had it been a different group, who knows how it may have turned out.

It may not surprise anyone to learn that none of the companies represented at this initial meeting are around today. In fact, none of them were around to see NAID’s 10th anniversary, let alone its 20th.

Ironically, CDD, the firm I helped start and ran for the better part of the 1980s, is still in business in Northwest Ohio and Rochester, N.Y.

The Association Starts Forming

In the first installment of this series, I wrote about the events leading up to the initial meeting. In that first meeting, industry professionals met to discuss forming a secure destruction industry trade association. The vision and integrity of those first six set the stage for the next steps of NAID’s establishment.

This is Part Two of a three-part series about NAID’s early history, which discusses the second NAID planning meeting held in the spring of 1993 and the formation of the organization.

Putting A Plan Into Action

In Part One of this series, eight professionals met in Las Vegas, Nev., to discuss the possibility of a secure destruction industry trade association. They thought it was best to reach out to others to get input about the idea prior to taking any steps. To that end, another meeting was scheduled in Orlando, Fla., the following spring. Among those attending the meeting were those who attended the first Las Vegas meeting and 16 other, highly regarded industry professionals. Everyone attended at their own expense.

Among the additional 16 attendees were Bill Cook of Cook’s Mobile Shredding (Tennessee) and Brian Dorosz of Certified Document Destruction (Ohio), the only two service provider representatives in attendance who still remain active in the industry. Others in attendance included John Thomas, Jr., and Bill Buhl of Document Services, Inc.; John Mengel, Sr., of Chicago Data Destruction; Russ Walzer of Mohawk Records Management (Minnesota); and Woody Clayton of Security Archives, Inc. (Texas). Bernie Thomas of Schleicher Manufacturing and Jean Flavin of Allegheny Shredders were also in attendance, representing equipment companies.

The meeting lasted a full day. I and several others who were present in Las Vegas used most of the morning to explain the concept. Of course, everyone there was familiar with the concept of a trade association, but the “devil is in the details.” The purpose of the meeting was not only to get buy-in but also address concerns in the association’s foundation documents such as the bylaws and corporate charter.

Some of the concerns raised in the meeting were anticipated.

For instance, there was some concern about how the new organization would deal with the divide between plant-based and mobile service providers. Luckily the group wisely agreed that the association would remain neutral on that issue, instead focusing on educating customers on the need for proper destruction and the benefits of outsourcing. The consensus was that customers could make their own choice between the competing service platforms.

It was more important to increase the amount of customers for everyone by raising awareness. All boats would rise equally under this strategy.

Also, there were a number of attendees who worried that establishing NAID would actually lead to more competition. As a result, it was determined that NAID would not provide incentives or training materials specifically designed to attract new competition. As it came to be expressed in the future, NAID would be your best friend once you are in the business; however, would not provide information about how to get started in the industry. Regardless of NAID’s position, however, the increased attention on data protection, privacy and identity theft issues dramatically increased the number of competitors in the industry. By the end of that day, though some participants remained skeptical, those 24 professionals left with the understanding of what NAID would become.

Due to a meager treasury that included $1,200 from those that participated in the first planning meeting, I filed the incorporation papers myself. Fortunately, years later the incorporation documents were reviewed by an attorney who did not find any problems. Once incorporated, I also filed for non-profit status with the IRS as a 501(c)(6) organization designating it as a commercial trade association. All in all, it was a relatively simple and inexpensive process.

The decision to structure NAID as a non-profit was never really in question. In that regard, the founders were following in the footsteps of other, world-class trade associations they admired such as ARMA, ASIS, PRISM, AIIM, IFMA, BOMA and AHIMA. It was a well-founded principle that the level of transparency and accountability inherent in the non-profit structure would be critical to the organization’s credibility and integrity. The non-profit structure was the only one that would give every member an ownership stake in the organization and ensured their rights of representation in the long term. (See “The real value of NAID’s non-profit structure” on this page.)

Taking It To The Streets

It was very important the founders had everything in place when they rolled out the association for the first time. Had NAID entered the market without the corporation, charter, bylaws or having applied for non-profit status, things would most certainly have gone differently. In August 1995, non-profit status was officially awarded to NAID. As a result, NAID founders did not have to answer questions that most people would ask before giving their support. Some of those questions might have been: Where is the corporate filing? What’s the structure? How are officers and directors elected? Where is the charter? Who owns it? By doing most of the work first, the founders found it much easier to introduce the trade association to their potential members.

As it is often done, the initial bylaws created a temporary board of directors that would serve until an official board could be chosen by the membership. That board consisted of Carol Kopelman of Document Destructors in Washington, D.C., as president, Bill Buhl of Document Services, Inc., in Pittsburgh, Penn., as vice president, Pat Clayton of Security Archives, Inc., in Dallas, Texas, as secretary/treasurer, and Russ Walzer of Mohawk Records Management in Minneapolis, Minn., Rich O’Brien of Arizona Records Destruction in Phoenix, Ariz., and me as directors. I was an ex-officio director who did not have a vote. Then, I had volunteered to serve as the interim executive director until the association got on its feet. Everyone realized it would be years until the association could compensate any staff.

I agreed to keep it going until that was possible. The plan was to hire an association management firm when it was economically feasible, which ultimately came to pass in 1999.

The Shredded N – The Story of NAID’s Logo

Within the world of data destruction, and even in the broader world of records management and data protection, the NAID logo is a highly visible and familiar insignia. In many ways it has become more of an icon than a simple logo, recognized far and wide, even without the NAID acronym associated with it.

“The shredded N,” as it has come to be known, appears today exactly as it did 21 years ago when it was first created. At the time, Carol Kopelman, who eventually became the first NAID president and was from Document Destructors, Inc., in Washington, D.C., had a daughter who was a graphic designer. In late 1993, after a short discussion of what the new trade association would be and what the founders wanted the logo to represent, Kopelman shared her daughter’s designs with the group. While there were five or six logos featured, someone noticed a sketch on the bottom of the last page that had not been fully developed.

All agreed that it had the most promise and asked for a finished version. What came back is exactly what the world sees today. In total, it took less than a week from concept to implementation. As the association grew and added chapters, so did the logo. See examples of those logos below.

The Association Achieves Relevance

The last NAIDnews installment of NAID’s early history ended in the summer of 2005, with the new association having held its first annual conference. While the event was a success, the organization had about $6,000 in the bank, no paid staff and was in need of some creative ideas to be effective with so little resources. As it were, it would be nine years until NAID paid for any staff and, even then, the staff remained part time for two more years.

Prior to NAID, in 1990, I had created a brochure for my consulting business titled “Information Disposal.” It confronted the seven most common objections to using a data destruction service. It became fairly popular at the time. Its success was largely based on the fact that it was the only third-party, educational brochure in the industry. Frankly, the success of the brochure was my first experience with educational pieces proving to be more credible than the same literature generated by the service providers themselves.

Based on the past success of the Information Disposal brochure, the fledgling board took a leap of faith in creating the first NAID brochure in late 1995. The brochure made the case for outsourcing data destruction as well as branding NAID. And, though it took about half of NAID’s financial resources to create it, the 140 or so members ate it up. For the first time ever, service providers had a tool from a third party, non-profit, education-oriented organization that explained why outsourcing secure destruction was the better option. In fact, simply having a legitimate trade association for the industry gave added credence to what members were offering.

1995 also happened to be the year mobile data destruction was appearing throughout the U.S. (Note: The mobile platform remains a footnote in Europe and Australia and has not surfaced yet in Asia.) As mentioned in Part One, NAID’s founding members had resisted the temptation to create an association of plant-based service providers in favor of a more inclusive approach of future platforms. They decided it was more important to keep the discussion on the general importance of secure destruction and the benefits of outsourcing. Lax customer attitudes on data disposal were the issues to confront, not which destruction platform customers chose.

Mobile Operators Join Forces To Start AMSA (1995-1998)

However, another group felt differently. With the increase in mobile services, a group of mobile service providers decided to form the American Mobile Shredding Association (AMSA) in 1995 to promote that platform. AMSA was a created as a non-profit organization dedicated to promoting the use of their members’ services locally and nationally. The organization also made no secret of the fact they were attempting to battle the growing number of mobile operators in the Shred-it franchise network. Shred-it was having success with national accounts, an area in which the independent operators had no means to compete. At this point in time there were no national, plant-based service providers in operation. At its peak, AMSA had about 80 members, rivaling NAID’s size at the time. Most AMSA members also supported NAID so the organizations coexisted rather peacefully. NAID had no designs on national account management since it would inevitably pit one member against another where multiple members served the same market.

After a couple years, having delivered no national accounts or other meaningful benefits, AMSA decided to disband. Many AMSA members had added plant-based or records storage services, both of which seemed inconsistent to arguments that destruction services were best offered onsite. Those offering records storage had trouble promoting the position that records could be stored offsite but had to be destroyed onsite. Prior to its dissolution, however, the AMSA Board of Directors attended a NAID board meeting in 1998 to request some changes to NAID’s structure. Several compromises were reached at that meeting to accommodate what were viewed as reasonable improvements by both boards.

NAID Develops Certification Program (1997-2000)

The idea of an industry certification was a topic among NAID leadership from the beginning; however, it was not until 1997 that a task force was formed to create the structure and specifications of a program. Among the task force members were Tom Simpson of Confidential Security Corp in Peoria, Ill.; Don Thorne of InstaShred in Irvine and Oakland, Calif.; Bill Buhl of Document Services with seven plants across the eastern half of the U.S.; and David Culbertson of Texas Shredding in Houston, Texas.

After two years of planning, the board approved the program and the NAID Certification Program was officially unveiled in March 1999 at the annual NAID conference in St. Petersburg, Fla. There were to be three levels of certification offered: A, AA and AAA with AAA being the most rigorous. NAID contracted with Pinkerton Security to conduct the audits. Within the first few years of the program, NAID certification dropped the A and AA versions to become the NAID AAA Certification Program. Also, NAID started contracting with independent, ASIS International accredited, Certified Protection Professionals (CPPs) to conduct the requisite audits. The success of NAID certification is now a matter of record and it stands as the crown jewel of the association’s programs.

Transforming From Start-up To Industry Institution

After NAID’s first conference, the still struggling association faced a predictable set of challenges: little money and no paid staff. I remember one early call from a prospective member in 1996 asking about the extent of NAID’s lobbying efforts. It was tough to report that NAID barely had the money for the airfare to get to Washington, let alone do any lobbying. My time was largely spent planning the annual conference (e.g., sessions and exhibitors), soliciting new members and vendor support, and serving as a publicist for the organization.

Then, there came a point when it was a safe bet that NAID would be successful so I did what I always said I would do. I resigned in 1999. In reality, I had never intended to manage NAID for more than a few years. When the five-year mark rolled around and the association was ready to go to the next level (or stop being subsidized), I left and the board hired an association management company to run the organization. At the time, I was completely convinced that NAID would succeed without my further involvement. I did not take a salary in those five years and was more than happy to turn NAID over to professionals who knew how to run an association.

Nonetheless, I returned to NAID a few years later. In the interim, I had cofounded a secure destruction service in New York City. While it would be nice to take the credit for NAID’s transformation, no one person, group of people or single event is responsible. The first years of the new millennium saw the Health Insurance Portability and Accountability Act (HIPAA) and Gramm-Leach- Bliley Act (GLB) compliance deadlines hit, the ENRON/Anderson scandal, and the explosion in identity theft crimes that resulted in new state laws. It was the perfect example of preparation meeting opportunity, and it was the reason NAID transformed into the industry’s flagship trade association.

Why NAID Works

Timing and market conditions aside, there are some critical ingredients that led to NAID’s success.

The proper structure:

Shortly after the association incorporated, I filed the paperwork to become a non-profit 501(c)(6) organization. Not to avoid taxes; we did not have money. It simply showed our motives were not to make a profit but create a member-owned organization. Besides, all the associations I respected (e.g., PRISM International, ARMA International, AIIM, ASIS International, IFMA) were all structured as non-profits. It never dawned on the founders that members would be willing to build an industry brand over which they did not have legal ownership.

Inclusiveness:

We kept the discussion on the need for data destruction and the benefits of outsourcing. Consumers were in no position to decide between different service platforms if they did not care about data security in the first place. Once the market became educated, consumers would have the tools to decide what type of service best fit their needs.

Consensus building:

NAID has always involved a lot of members in everything it did and continues to do. Industry professionals are encouraged to run for office and participate on committees, councils and boards. Even now, close to 100 industry professionals participate at some level in NAID leadership roles.

Mission-driven orientation:

The idea for NAID came to me after more than a decade of selling data destruction services where misinformation and apathy ran wild in the industry. During those years, I longed for a credible, third-party industry association to help me make my arguments and rid the industry of the bad guys. I truly believe my dedication to the industry and NAID’s principles is simply a continuation of the battles I fought with ignorance as a young man. NAID is still about proving that point that so many ignored during the formative years of the industry.

No Opportunity To Rest

Few professionals would dispute that NAID has become an influential force in promoting secure destruction industry standards and education. While this three-part series was meant to cover NAID’s formative years, the challenges the industry faces will never cease. In fact, there has never been a time when one or more events, conflicts. or industry developments have not challenged the association’s mission or place in the industry. It would be naïve to think it would ever be otherwise. It will always be a struggle but such is life. Who knows, maybe in five years I will use the 25th anniversary of NAID as an excuse to cover the years from 2002 to 2014. For now, that chapter is still being written.