Adam Burroughs

Having a job or a career can be central to a person’s self-confidence. Coleman Professional Services Inc., a nonprofit provider of behavioral health and rehabilitation programs, works to find jobs for those who may have more trouble finding a job than most — those who are mentally challenged or physically disabled.

CPS offers job placement, training and temporary work for those with barriers to employment while helping employers connect to this segment of the workforce through recruiting and outplacement. When successful, it means getting people off entitlements and helping them become more productive members of the community.

Smart Business spoke with CPS’s President and CEO Nelson W. Burns to learn more about the organization and the impact it has on those it serves.

SB: Where is CPS headquartered and what geographic areas does it serve?
NB: Coleman is headquartered in Kent, and serves individuals in seven Ohio counties that include Trumbull, Portage, Stark, Summit, Allen, Hardin and Auglaize.

SB: Whom in the community does CPS seek to help with its employment services?
NB: Coleman’s employment services are designed to serve any adult more than 17 years of age who has a disability.

SB: What services do you offer these individuals and what do you hope is the end result of their involvement?
NB: Our employment services work to support a final outcome of employment. However, Coleman might provide a wide variety of services to help facilitate employment. These services might include skill training, job experience, education support and employment aides such as clothes or transportation vouchers. Coleman operates businesses that actually hire people with disabilities. Coleman employs more than 80 people with disabilities in its Coleman Data Solutions business, a document management service.

SB: How would individuals with barriers to employment be affected if these CPS services suddenly vanished?
NB: These individuals with employment barriers would rarely be able to find employment or keep employment. Without employment, individuals with disabilities would remain on entitlement funds and less likely to contribute to their families and the community.

SB: What misconceptions does the organization spend much of its time overcoming?
NB: Many people think that people with disabilities are lazy or ignorant. The truth is that many of these individuals are very reliable and loyal employees.

SB: How do you quantify the benefits a community (business and social) experiences when these individuals are able to get jobs?
NB: The key benefits from employment are reduction of entitlements, active participation in the community without idle activities, proper model behavior for their families and more discretionary money to participate in the economy.

SB: What does it mean to someone who otherwise might have trouble getting a job to be employed?
NB: Employment is an important factor of our self-concept. With a job, people feel more confident about themselves and their contribution to the community. In a recent testimonial, a woman of 40 years of age commented to me how her unemployment resulted in deep depression and hospitalization. These conditions can lead to broken families, mental illness, addictive behavior and expensive health care.

SB: Other than funding, what is CPS’s most critical need?
NB: CPS continues to have challenges in helping people navigate through complicated systems of public aide, Medicaid and a complex system of governments and fellow nonprofit organizations.

SB: Why should a company consider employing individuals with the disposition(s) you serve?
NB: Companies can hire a reliable individual who will remain in employment. Our clients have a history of loyal and focused work experience. A company can win in business as well as helping a person and helping the community.

SB: How can companies get involved with CPS?
NB: Companies can call on CPS’s employment services for their special needs in their business.

How to reach: Coleman Professional Services, (800) 673-1347 or

Employers are trying to encourage their employees to save more for retirement, but the numbers aren’t in plan sponsors’ favor. According to the U.S. Census Bureau’s 2010 census, 73 percent of our population will struggle financially during retirement.
Why are employers so interested in employee plan participation? Discrimination testing plan sponsors must go through has encouraged the drive to make sure participation is adequate for non-highly compensated employees. If participation and deferral percentages are low for non-highly compensated employees, highly compensated employees can’t defer the maximum contribution amount, which leads to refunds at the end of the year.

“To make a plan financially healthy for all employees, good participation is needed across the board,” says Linda A. Cahill, a principal at Benefits Resource Group.

Smart Business spoke with Cahill about ensuring you have adequate participation in your retirement plan to maximize its impact for all employees.

How does discrimination testing affect employer plan participation levels?

Although individual situations can vary, the general rule of thumb for discrimination testing is that highly compensated employees (HCE) are only able to contribute about 2 percent more than the average of the non-highly compensated employees (NHCE). For instance, if a company’s average HCE is deferring 7 percent and the NHCEs were only deferring 4 percent, it’s possible that the company could fail the discrimination test and the HCEs would be given refunds. These refunds can end up costing HCEs thousands in potential retirement savings, so it’s important for a company to encourage plan participation among all employees.

How can employers boost plan participation?

Employers are adding plan design features such as automatic enrollment to boost engagement. Survey data shows that about 47 percent of all plans have an automatic enrollment feature, and 89 percent of those employers use auto enrollment for new hires. This automatic enrollment is also being used to bring in nonparticipants, allowing employers to ‘refresh’ enrollment.

Many plans have increased their automatic enrollment amount from 3 to 6 percent. In 2010, 7 percent of all plans used 6 percent contribution. Now it’s 10 percent. That’s the direction things are headed.

What aren’t more employees participating in or saving enough for retirement?

It’s a lack of education and communication regarding the importance of saving and starting early. Fortunately, there’s been an increase in communication to employees regarding retirement plans. More than half of plan sponsors surveyed indicated they’ve increased their employee communication. This takes the form of group and one-on-one sessions. Some are integrating a retirement income calculator in these sessions to project if an employee is on track to meet his or her retirement goals.

Technology is the key to driving participation, but it’s underused because of a lack of communication and education. There are tools that can dial-up deferral or contribution levels and determine the outcome, but participants must be made aware of these in order for them to be useful.

How can employers help employees know if they’ll meet their retirement goals?

Employees should sign up on the Social Security Administration’s My Social Security ( site to determine their estimated benefits and double-check salary data. Using that information with current account balances and a retirement income calculator gives a pretty good estimate of what income a person has for retirement.

It’s good to have an annual review with the plan sponsor to determine if employees are participating, if they’re invested appropriately or if they are paying attention to details, because with a 401(k), participants are responsible for their own retirement outcome. They need to look to make sure it’s doing what they want it to accomplish.

People spend hours planning their vacations, but don’t spend the same amount of time planning their retirement, which is potentially the longest vacation one will ever take. Get people to think about these things today rather than allowing them to continue to delay planning until it’s too late.

Linda A. Cahill is a principal at Benefits Resource Group. Reach her at (216) 393-1812 or

Insights Employee Benefits is brought to you by Benefits Resource Group

Highlights for Children might be best known for its Highlights magazine, which many children — and before them their parents and their parent’s parents — get at school or thumb through in doctors’ and dentists’ waiting rooms across the U.S.

While it’s proud of its past, the company has invested heavily in its future, propagating its brand internationally to reach children across the world. As it grows its presence and its products, the company is studying its customers and consumers, adapting its processes, expanding digitally and aligning its focus on the customer experience.

“We’ve definitely shifted from being a magazine-focused company to putting the customer at the middle of our thinking; we like to think of ourselves today as a family media brand,” says Shelly Stotzer, executive vice president and chief marketing officer for Highlights For Children.

Highlights breaks its audience into two segments: its consumers, who are the children from ages 0 to 12 who use its many products, and its customers, who are “almost anyone who is part of the village of raising a child,” Stotzer says. That includes parents, grandparents, aunts and uncles, teachers, doctors, caregivers and anyone else who is helping raise a child.

“We see people who buy from all demographics, all backgrounds, all different types of professions,” she says. “We definitely have a very diverse market.”

The company has a stronghold in the U.S. market, and has spent the past four years working to establish its brand across the globe. Today the company has a presence in Korea, Brazil, Ireland, India, Poland and China, putting some 4 million products in the latter country this year, compared to a few thousand in years prior.

Reaching all those countries means the company has had to expand its infrastructure, working with local partners in foreign markets to adapt its products to each one’s specific culture and people.

“We find great partners who we trust, we work closely with them to make sure we stay true to our mission, and then we adjust to make sure we’re appropriately meeting expectations and needs,” Stotzer says.

Highlights has also expanded its digital presence, providing children’s content on the Web for the past 10 years, and launching apps as far back as five years ago.

“Each day we learn something new,” she says. “The technology is changing so quickly. It wasn’t long ago that there weren’t many children’s books available in e-book format, but there are today.

“Children are not only downloading them but they’re also borrowing them from the library in a digital format.”

That means the company has had to keep its eye on the market to understand the needs of its consumers.


Putting customers first

Monitoring customer behavior serves multiple purposes for Highlights, such as helping its shift in philosophy from product-centric to customer-centric, in part to improve customer service.

“When we were product-centric, we were focused on how to increase sales or improve the experience within that product experience,” Stotzer says.

The company’s more recent customer-centric approach focuses entirely on the purchase and service experience.

“It says regardless of which product you buy or which channel you buy it through, we want to make sure that the infrastructure we’re putting in place, the processes, the experience is consistent and positive across that entire experience,” Stotzer says.

Illustrating the difference from one approach to the other, she says if someone bought a book from a retailer and they had a question about it, they could call an 800 number. But if that same customer on the same call had a question about a different product, they would need to be transferred or call another number. Today, one customer service staff at one number serves all its products.

“I believe that repeat buyers come from good customer experiences, good brand impressions. What necessitated it was recognizing that if we want to be as successful 60 years from now as we are today, if we’re going to get into all these new products and markets, we need to make sure we do it well.

“Simply saying if I’m a customer of Highlights, this is how I want to be treated, and if I want customers to come back this is what we should expect,” Stotzer says.

This approach is particularly important as the company continues to grow its product offerings from magazines into toys, merchandise, books and mobile apps while simultaneously building on its direct marketing approach by adding e-commerce and retail, all along with developing strategic partnerships in foreign markets.

“By doing so we needed to really pause and make sure every interaction, how we made decisions, how we set up our teams, how we engage the customer really reflected what we wanted it to reflect, which was a consistent, positive, customer experience,” Stotzer says.

Gaining greater insight

Taking that time to reflect led Highlights to establish its customer insights team, which was put in place to not only help the company provide better customer experiences, but also to leverage customer and market data differently.

“We have always done a good job of doing market segmentation for direct marketing,” she says. “We’ve always done a good job of understanding the profitability of our sources.

“But our customer insights team kind of flips that information on its side and allows us to look at who are our best customers across all the different channels we sell through — all the different product formats that we sell, who our best customer is, who is most likely to buy another product once they’ve bought our Hello magazine, who is most likely to transition into our High Five and into our Highlights, but then who also might be buying an app or some other type of product that we have to sell,” Stotzer says.

Highlights’ marketing database tool enables the company to better understand its customers’ experiences and life cycles across all of its products.

“So with the new database, it is structured in a way that the customer view is the first view that we see,” she says. “It provides a lot more flexibility in slicing and dicing that information so we can make good decisions. It also allows us to effectively target the right message to the right customer at the right time through the right channel and allows us to track that in a very visual way.”  

The database further allows Highlights to track customer purchases and marketing, which permits more trigger and automated marketing that makes it easier to follow up with the right transactional, sales or content touch point at the appropriate time.

Chasing a vision

The customer insights team also fielded Highlights’ first brand study this past spring. The study was an effort to understand not only what customers think, but what potential customers who aren’t engaging with Highlights today think and how Highlights might change their perceptions over time.

It’s also a step toward helping the company transition from being known primarily as a magazine for children in the U.S. to an international family media brand — “A customer-centric, global, multichannel, family media brand,” Stotzer says.  

She says the study was a starting place that established where the company was and compared it to where it wanted to be.

“We really put ourselves up against brands that we looked to as family media brands,” Stotzer says. “In the study, we did not put us up against brands that we felt were our historical competitive set where we might have been the leader in the group. We really wanted to create an aspirational set that would help us understand where we sit compared to those.”

She says she was happy with the results.

“I’m quite proud of what we’re known for. If you look at the characteristics that people think of us, they are right where we want them to be. We’re known as wholesome. We’re known as good for children. We’re known for being respectful. We’re known for a lot of the characteristics that we’ve strived to be known for.”

Highlights will repeat the study annually to track its progress against its benchmarks.

“We have a lot to build from, and that was helpful because there’s so much noise in the world today, you’re not sure where you really sit, but it was really helpful to know that we have a great foundation to build on,” she said.

The company is looking forward to spring boarding from that foundation to the next level.  

“The world is a big place,” Stotzer says. “We have plenty of countries and plenty of children all over the world who we can reach with the products we have, and we’re also continuing to add several products a year to our portfolio.

So we need to do all those things while also keeping an eye on the changing digital market and the changing needs of children.”


Find out how Highlights for Children is creating a comprehensive Web and social media strategy for all digital platforms


Learn more about Highlights for Children, at:

Twitter: @Highlights


How to reach: Highlights for Children, (614) 486-0631 or

You’ve just launched your product, which has taken months of research and development effort to bring to market. Soon after its debut you receive a notice that you’re infringing on an existing patent or trademark.

You’re now left with a decision: License the technology that you’ve infringed, which you may or may not be able to do, or wind up with a costly infringement suit. You could fight the suit, retreat and try to design around the patent, or scrap the whole thing and start again. Any of those choices come with substantial costs. All the while knowing that with a little bit of due diligence up front all of it could have been avoided.

“Don’t undervalue your business’s IP,” says Jeffrey N. Zahn, an attorney with Fay Sharpe LLP. “Do what’s required to make sure it’s protected and not potentially infringing a third party’s IP rights. This will help you protect your investment in your IP and avoid unnecessary third-party, IP-related expenses down the road.”

Smart Business spoke with Zahn about the intellectual property (IP) mistakes companies most often make.

What IP mistakes do businesses make most often?

The three biggest IP mistakes, in no particular order, are the failure of a business to adequately protect its IP, failure to avoid infringing the IP of other companies and failure to seek the advice of an IP attorney.

There are many ways a company can leave its IP exposed. Those include not using nondisclosure agreements when working with outside parties; forgoing patentability investigations to determine if a patent would suitably protect company technology; failing to file provisional and regular utility and design patent applications when appropriate; allowing trade secrets to leak; not ensuring employees, outsiders and third parties maintain the confidentially of the company’s critical technology; and failing to federally register trademarks to protect brands.

Another major problem is failing to avoid infringing on another’s existing IP rights. This is often the result of not conducting freedom to operate searches for issued patents, as well as published pending patent applications, and trademark clearance searches.

But the one mistake that often leads to all others is failing to seek the advice of an IP attorney. This is a critical aspect of due diligence and developing a solid and secure IP strategy.

Do large or small companies typically make these mistakes?

Smaller companies are more likely to make these mistakes. Smaller businesses often believe an IP attorney is a service they can’t afford, or one is only needed when filing a patent or trademark application. In most cases, it comes down to not recognizing the value of IP to their businesses.

In contrast, the larger a company is the more likely the company is educated about IP and has in-house counsel and/or a relationship with an IP firm to address these issues.

Is there a particular time when a company is more vulnerable to IP issues?

Businesses are typically more at risk during the early stages of their existence. That’s why companies should take stock of their IP and look into the market to identify the IP of the relevant third parties, such as competitors, early on. This can save a lot of time and expense if it’s done up front.

Companies are also vulnerable during the early stages of a product development cycle. Bringing a potentially infringing product to market may require the company to license the infringing technology or trademark, or rebrand or redevelop the product if the technology or trademark can’t be licensed. That’s why it’s critical to conduct freedom to operate searches and trademark clearance searches during the initial stages of a product’s development.

What can help businesses prevent these errors from happening?

The best tool is education and a proactive IP management program. Have conversations with those who know the issues — someone who works in the IP field regularly, whether that’s an in-house attorney or an IP attorney at a firm — because affected parties must be aware of IP issues. Then continue to talk with an IP attorney as your business grows, new products are developed and new markets are served. Many businesses would be pleasantly surprised how valuable an initial consultation with an IP attorney is relative to the expense.

An ounce of prevention is worth a pound of the cure. This is especially true in the area of product design and branding where a little due diligence to investigate third party IP rights can help you develop your product and brand strategy so it doesn’t potentially infringe existing rights. This can help you avoid potential infringement issues, such as a costly patent or trademark infringement suit.

Jeffrey N. Zahn is an attorney at Fay Sharpe LLP. Reach him at (216) 363-9168 or

Insights Legal Affairs is brought to you by Fay Sharpe LLP

Rising health care costs have driven up insurance premiums, straining employers’ funds and leaving less money available to invest in their businesses, hire employees or award pay increases.

“Any time costs go up, there’s less money to spend on other things that are important to the growth of a business,” says Ross Farro, a principal at Benefits Resource Group. “It comes down to companies deciding how they will pay the increased expenses and continue to offer health care benefits.”

Smart Business spoke with Farro to learn about strategies employers can utilize to effectively deal with rising health care costs.

Are certain types of businesses hit harder by these changes than others?

Generally the size of the business determines how it’s treated under the Affordable Care Act (ACA). For instance, the new law means community rating is used to determine premiums for companies with fewer than 50 employees, which eliminates medical underwriting. This has driven up rates for companies with healthier workforces — sometimes as much as 50 to 120 percent. They are also obligated to provide minimum essential benefits to meet the plan design requirements under the law.

Also, employers that offer group benefits are being hit with fees and higher taxes that come with the ACA. Large employers are also still awaiting final U.S. Department of Health and Human Services guidance for measuring the eligibility of employees during 2014 for required coverage in 2015.

What are the most troubling issues for employers as health care costs rise?

Employers are concerned with controlling costs without reducing employee benefits. The taxes and fees that come with the ACA are substantial. This year, taxes and fees are roughly 5 percent of fully insured premiums, and are expected to increase next year. Employers paying $1 million for health care premiums will have $50,000 in associated fees. For many companies, that’s the equivalent of one potential new employee’s annual salary.

What should employers do to better control health care-related expenses?

Wellness plans and an emphasis on consumerism are two approaches that can help employers better afford the health insurance benefits they offer employees. Negotiating with or changing providers really doesn’t work. A better solution is to focus on things that can be changed, such as addressing obesity and chronic disease within your employee population since these are factors that increase costs. Wellness initiatives not only have an impact on insurance premiums over time, but can improve productivity and mitigate disability claims.

Health care consumerism is fundamentally about restructuring an employer’s health benefit plan into one that puts economic purchasing power in the hands of its employees. To leverage this approach, companies should consider programs such as a health reimbursement account or a health savings account paired with a high deductible that pays for health care expenses with pretax dollars from the employee, employer or both. Either strategy brings attention to the costs of services and prescription medications, encouraging employees to be more cost conscious.

Self-insuring allows employers to pay the costs of claims rather than pay for a fully insured premium, offering a more transparent look at costs. It also can substantially reduce the amount of new ACA fees and taxes. Self-insuring is becoming a viable option for employers with fewer than 100 employees, as insurance carriers are developing products for groups as small as 25 employees.

If employers do only one thing to deal with the challenge of rising health care costs, what should it be?

Employers need to work with a consultant, not a broker. It’s not only about shopping your benefits with other insurance providers; it’s about being creative and knowledgeable. You need a proactive consultant who understands the laws and can develop strategies to help you. As much as employers might want to wait to see if something comes along to derail the ACA, they must realize it’s not going anywhere at this time.

Ross Farro is a principal at Benefits Resource Group. Reach him at (216) 393-1820 or

Insights Employee Benefits is brought to you by Benefits Resource Group

Companies invest significant resources developing products and services that are intended to generate revenue. The ability to prevent competitors from copying these new products and services utilizing intellectual property (IP) protection is essential.

However, many companies fail to fully protect all of their resources. Or, by failing to educate their workforce on the vulnerability of unprotected assets, unintentionally spoil the outcome of products in development before they reach the market.

Smart Business spoke with Sean M. Weinman, an attorney at Fay Sharpe LLP, to learn what companies at various stages of their lifecycle must do to protect their IP.

What are some common mistakes young companies make when it comes to their IP?

The most common mistake young companies make is failing to protect their intellectual property (IP). Some companies choose not to protect their IP because they don’t believe that IP protection is available. Others choose to protect IP but file for such protection too late, while some avoid seeking protection because of cost concerns.

One common mistake is thinking that patents are the only IP that matters, which ignores the importance of copyrights, trademarks and trade secrets. Failing to protect all types of IP can have devastating effects on a company by leaving the door open for competitors and customers to access and copy vulnerable IP.

What mistakes do more established companies make when it comes to IP?

A common mistake more established companies make is mismanaging their IP. Protecting IP can be expensive. Therefore, an IP strategy needs to be developed with an understanding of how IP fits into an overall business strategy. A good strategy should at least consider which assets should be protected, the extent of the company’s investment in pursuing IP protection, and how IP can support the company in achieve its business goals.

More established companies often fail to perform an IP audit to check that all IP is being protected properly. A review of all existing products and those in development should be performed annually to ensure that all potential IP is being protected and valuable rights are secured. IP audits also help ensure the right IP is being protected. Many companies waste thousands of dollars protecting the wrong IP. Protecting products and assets that have little potential can negatively affect a company’s bottom line.

Along with having a strong IP strategy, it is important to understand competitors’ IP to avoid costly lawsuits and ensure up-and-coming projects have strong market potential. Not knowing the scope of your competitor’s IP protection could impede your own product development if you incorrectly assume it’s too close to something your competitor is developing, even when a lucrative opportunity exists.

How can companies avoid these mistakes and gain a better understanding of IP?

First, hire an IP attorney who has experience developing IP strategy and protection, ideally in the technology domain of the company. You want to find a lawyer who will work with your company and who understands your company’s business, strategy and plans for the future.

Include confidentiality and IP provisions in agreements with employees, contractors, suppliers and other parties. A premature public disclosure of a new product can negate future IP protection. In many cases, foreign patent rights are lost if an invention is publicly disclosed or offered for sale before a patent application is filed. Additionally, all employees, contractors, and other parties working close to your IP should be required to assign any and all IP to the company. It is important that non-employees include similar provisions assigning IP rights to the company.

Further, make sure your entire company is educated about IP. In most cases, only management and engineers understand IP protection. However, other groups of employees are also associated with the IP of a company, such as marketers, salespeople and technicians. Educating an entire company about IP can help ensure that IP rights are not lost because valuable IP isn’t identified, a public disclosure is made prematurely, or protection is filed too late to be effective.

Sean M. Weinman is an attorney at Fay Sharpe LLP. Reach him at (216) 363-9000 or

Insights Legal Affairs is brought to you by Fay Sharpe LLP

Clark David Baker, president and CEO of the YMCA Of Greater Houston, doesn’t have to dig deep to find an example of how the YMCA assists future business leaders in the region.

Benton Love, former president of Texas Commerce Bank, and Gerald Hines, founder and chairman of Hines, one of the world’s largest real estate companies, both share something in common besides success in their respective fields: Both at one point lived in housing provided through a Houston YMCA residential program.
“We’re a people organization,” Baker says. “Therefore, we don’t make widgets; we build people.”

The 37 YMCAs that comprise the organization that has been a part of Houston for 127 years serve 100,000 people weekly through its programs, which are lead by 6,000 full-time staff and 13,000 volunteers. Houston, however, is not the same city it was more than a century ago — in order to cater to this generation of residents, you have to understand them.

“Back in the day when I was coming along, we threw a couple of basketballs out in the gym and everybody just came and played. Everybody got along, everybody looked the same, everybody was lower-middle income,” Baker says. “You come to Houston, Texas, (today) and we’re the most diverse city in the country. We speak 23 languages here at our YMCA.”

While the community the YMCA serves has changed, the organization’s mission hasn’t.

“Our core values are the same. Our core programs are the same,” Baker says. “But in Houston you’ve got to be sitting on the edge of your chair because of this multicultural community — one size doesn’t fit all.”

Here’s a look at how the YMCA has evolved with the times, placing an emphasis on getting a diverse, qualified staff to serve a diverse population.

Building the leaders of tomorrow

The key to serving that diverse community is finding the right people for the job.

“One of the wisest men I know told me there are only two things that can get you in trouble: You’ll run out of money, or you’ll run out of talent,” Baker says. “Spend your time on the talent, and you’ll never run out of money. So we hire passionate young people who want to make a difference in the community.”

According to Baker, the YMCA’s professional-level jobs offer competitive pay, resulting in 20 to 40 applicants for each opening.

“We’re a great place to work,” he says. “We’re a great service to our community and people want to work for us. So we do not have a staffing shortage or a crisis in getting talent.”

Volunteers primarily come from the families of the children served by the YMCA. He says 73,000 kids played youth sports last year, all coached by volunteers.
While filling positions seems to come easily, developing the organization’s future leaders gets special attention.

“One of my jobs is to recruit, train and retain the best and the brightest people available. We have a serious commitment to training,” says Baker.

To that end, the YMCA makes a significant investment in preparing its staff to advance, as evidenced by the $3 million it earmarks for training out of its $115 million annual budget. It also has a 35,000-square-foot training center located in the center of its service area, which will train about 2,000 people this year, according to Baker.

The two-story YMCA Center for Leadership Development has conference and training rooms and a computer lab through which webinars and other online training programs are hosted for those who can’t be there in person. It also houses Springfield College, which assists the YMCA with leadership development.
“We grow our own leadership,” Baker says.

The YMCA also uses career mapping coupled with a personal development plan for all full-time staff that plots where the employee wants to get in the organization and helps him or her understand how to get there. Testing is conducted to see where employees excel, and gap analysis is used to see what skills the employee lacks. Each employee’s career development plan is reviewed every two to three years to track progress.

The YMCA also utilizes external quality measures to rate performance, such as the Net Promoter Score, which is used to gauge customer satisfaction. The staffers who run YMCA programs get measured regularly through the NPS, and from that each staffer’s gap analysis data is gathered.

Baker adds that the Houston YMCA has 10,000 donors who give annually to keep the organization’s work going. Satisfaction, then, can be measured by how many of those donors return to give the next year.

“And, thank heavens, we have about 90 percent of the people who give to us give annually for years and years and years,” Baker says.

But does all this training work?

“I would suggest that we have very low staff turnover. Our jobs are coveted. If we open a director’s job at one of our Ys, we have three or four of our staff who are qualified for that, and we’ll get them in front of a local board, which has a lot to do with who we hire,” Baker says.

Additionally, Baker says during his 57-year tenure he’s helped develop 23 staffers whom are now CEOs leading YMCAs around the country.

“You want to be known as a good person to work for. And I like to think I’m a good person to work for. I want them to come in and have a joyful experience; they’re all going to work hard. But I think your measure of success is who did you train and how well are they doing,” Baker says.

However, before a CEO can be placed, he or she has to be discovered.

“The simple answer is you want to find passionate people who believe in your mission,” Baker says.

He looks for people who “have a head for the business and a heart for the mission. There’s no mission without money, so you’ve got to be a good manager, you’ve got to know how to do a budget, you’ve got to know how to stay in a budget.”

Find value in a homegrown product

Baker himself is no stranger to the YMCA’s method of growing its own leaders. He’s been with the organization since he was 12 years old and was recognized by the director at the time as having a potential future with the YMCA.

“The joke is I went to the Y one day and just never went home,” Baker says. To keep the YMCA membership he received as a gift from a neighbor when he was 10 for a third year, he needed to work for it, so he started mowing the YMCA’s yard.

“At 12 years old, I could mow the grass with the best of them. I was a good edger with the old hand clippers. I used to pride myself on squaring the corners when I mowed. I got recognized by the (YMCA) director who told me if I took as much care with my job as I did with that yard, I had a future working there.

“So he gave me my first job. I was a gym attendant — I put the balls out and kept score at the games and kept order in the gym,” he says. “That’s how I started. So I literally started at the bottom and worked my way up.”

Baker stayed with the YMCA, working during his two years at Vincennes University.

He went on to Covenant College in Georgia, where he graduated with a bachelor’s degree in recreational management, before spending three years in the Army as a personnel specialist.

He says the Army gave him the chance to work with many different people from many different places.

“The Y and the Army are very similar in that regard. We’re a melting pot. We work with everyone. The end of our mission statement has two words, ‘For all.’ In Houston, Texas, that means the haves and have nots, both sides of our community.”

Baker was back in the U.S. in 1970 and was offered a job at the YMCA as youth director.

“And that was my first real job — you have a lot of jobs, but when they give you benefits and put your name on the letterhead you’re a real staff member then,” he says.

The job paid $5,500 a year with $100 a month to buy health insurance.

“The YMCA and the United States Army are the only places I’ve ever worked. I love the Y, and I love the job. You never made a lot of money but you always felt good about the money you made,” Baker says.

Telling the story

Before electricity, bug spray, air conditioning and the telephone appeared in Houston, there was a YMCA, according to Baker. And with its wide reach through all levels of class and culture and its aim of inclusion, the YMCA touches many Houston residents.

“Our business model is to charge those who can pay, and let those who can’t come in free. That’s a terrible business model, but it’s a wonderful human service model. We still deny no one service due to their inability to pay,” Baker says.

The Houston YMCA is a 4-Star Charity, according to Charity Navigator, which rates nonprofits based on financial health and their accountability and transparency. According to the site, among the more than 6,000 charities evaluated by Charity Navigator 30 percent obtained a four-star rating.

It seems many people recognize, utilize and appreciate what the YMCA brings to the Houston community. But making sure the story gets told and the brand’s strength is maintained takes work.

“Back in the day Santa Claus, Coca Cola and the YMCA were the three most recognized names in the world. Everyone you talk to loves the YMCA, but they don’t all know why,” Baker says. “My job and our marketing people’s job is to tell people why they need to love us.

“We’ve got the audience; we just have to tell the story. The best way to tell the story is to let them tell the story. So we believe in T-shirts, we believe in bumper stickers.”

The organization also has “mission moments,” which are stories told about what the YMCA means to somebody, what happened in someone’s life because of YMCA classes and programs.

The Houston YMCA has been telling its story since 1886 when the city had 12,000 people, and has managed to stay successful, much like its leader.
“It’s been a great career, a great opportunity,” Baker says. “It’s not a job. It’s a real ministry. You get up every day and you help people. It’s been good to me, and I hope I’ve been good to it.”

How to reach: YMCA of Greater Houston, (713) 659-5566 or


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The Clark Baker File

Education: Bachelor’s degree in organizational management from Covenant College in Lookout Mountain, Ga.

Born: Washington, Ind.

Hobbies: Baker is a pipe organist, which he says can be a difficult hobby to keep. In order to have access to the instrument he says, “You’ve got to become friends with pastors.”

Being friends with pastors also helps Baker with another hobby of his, attending estate sales and collecting antiques, particularly of the religious type. His best pick is two prie-dieux items from a church that closed in his hometown.

Baker is also a boater, owning a Carver 33 Mariner. “It’s old but it’s faithful, like me,” he says. “Boating is family and friends — you can always find somebody to go out with you.”

What’s one thing you’d love to talk about but never seem to get the chance? Probably my military service. People never ask what I did in the military. I was able to travel to 15 countries in Europe and abroad. For a little boy from Southern Indiana, those are big stories.

What’s your advice for burgeoning young leaders? Distinguish yourself in some way. Be known for something. There are too many people in the crowd; how are they going to know it’s you?

Who contributes most to your worldview? Malcolm Gladwell. He’s really an anthropologist helping us understand how we live today, why we do things we do today. I find since I work with people and since people are what I believe in I need to read books about people and their thoughts and their ways.

Twitter: @YMCAHouston

The financial crisis of 2008 led to the “meltdown” that brought on “the Great Recession.” Faced with immediate economic failure, large businesses were bailed out by the government, with the justification that they were Too Big To Fail (TBTF) — Because these businesses were so large and integrated into the rest of the economy, their demise was predicted to have a catastrophic effect.

This policy approach is a potential threat to free market capitalism, and therefore one that businesses must make sure they do not count on in the future.

Smart Business spoke with Walter Simmons, Ph.D., professor of economics and chair of the Department of Economics and Finance at the Boler School of Business at John Carroll University about the dangers of TBTF.

Why is TBTF a bad practice for society?

Government should not be in the business of selecting which businesses succeed; the market does a much more efficient job and avoids an outcome in which profits are privatized and loses are shared by taxpayers.

The inherent instability of the free market is the very catalyst of its survival and sustainability. Business cycles are an innate feature of the market and provide the dynamism and motivation for individuals and firms to innovate and invent. Those pursuing their own self-interest behave in a socially responsible manner in competitive markets, and thus outcomes are determined by competition and not by government selection. The free market encourages resources to be used in the most efficient manner, creating a situation in which no one may be made better off without anyone being made worse off. 

Why is TBTF a bad policy for big businesses?

The expectation that a firm should not be allowed to fail because it is very large and embedded in society creates a moral hazard and weakens market discipline. If companies and their affiliates believe that the government will bail them out from losses, they have less incentive to monitor risk because they are protected from the negative consequences. Thus, businesses that benefit from TBTF policies may be tempted to exploit their advantage and engage in high-risk behavior because they are able to leverage the risk against the governmental protection. 

Why has free market capitalism succeeded while socialism has failed?

Big, inefficient governments; bureaucracies that maintained a bloated system built on pseudo-patriotism and subsidized welfare; and the limitations and subversion of rights led to the disintegration of socialism. Of course, the free market is not perfect and is subject to situations of market failure, but it is generally believed to be the best economic game we have in town. Even communist countries such as China realized and have adopted it on their path to economic growth and prosperity.

Why is TBTF a threat to free market capitalism?

Economic stability is not an enduring characteristic of the free market. And the life of a company in a capitalist economy is one of struggle. Any competitive advantage is relatively short lived. Companies must adapt or die. Barnes and Noble and Netflix have succeeded while Borders and Blockbuster have failed.

The difficulty with a ‘bailouts’ approach is that one can only learn whether a firm’s failure would tend to be disruptive if it is allowed to fail. Once a firm has been rescued, there is no way of knowing how disruptive its failure would have been.

What does the future hold?

The government had no explicit policy to rescue TBTF entities and it only became an issue for policy makers after the financial crisis. Systemic risk mitigation polices, such as the Dodd-Frank Act, limited the size and scope of activities of financial institutions that were already in place. They recognized the desire to avoid potential or moral hazard issues. This implies that ultimately it is the responsibility of companies to manage the inherent risk within the free enterprise system. Companies should have a strategy to benchmark their ability to take risk. In general, for the free market to allocate resources efficiently, companies must be financially rewarded for making good use of resources and, although they may not like it, punished when they do not.

Walter Simmons, Ph.D., is a professor of economics and chair of the Department of Economics and Finance at the Boler School of Business at John Carroll University. Reach him at (216) 397-4659 or

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There are very few written policies that are required by law to be provided to employees, but there are certain policies companies can adopt to protect themselves and reduce their liability exposures. This can either be done though a company handbook or by distributing individual policies to employees.

“Courts have said that by advising employees of certain information, the burden shifts from the employer proving something didn’t happen to the employee proving something did. That can be a significant difference in an employer’s ability to defend itself both in terms of success and cost,” says Jeffrey Dinkin, a shareholder at Stradling Yocca Carlson & Rauth.

Smart Business spoke with Dinkin about key policies that should be included in employee handbooks and what other options exist.

What are some required policies suitable for an employee handbook?

All employers are required to have sexual harassment policies that clearly state to whom employees should report complaints. More than one person should be designated, but if that’s not possible, there are outside resources to which you could direct them.

For companies with five or more employees, if the company has leave policies, policies regarding pregnancy disability leave must be included. As a note, under recently enacted legislation there must be continued employer health insurance contributions during the period of pregnancy disability leave for up to four months. The California Family Rights Act also allows 12 weeks of baby bonding leave, with continued employer health insurance contributions now also being required.

Employers with 50 or more employees are covered by the Family and Medical Leave Act, which must be honored when you learn an employee is eligible for family medical leave, and requires a related employer policy.

Also, a new law dictates that employees paid commissions need to be provided a clearly written commission agreement that describes how commission is calculated, earned and paid. It needs to be signed by, and a copy given to, the employee.

What else should an employer include in an employee handbook?

Employers should have a policy that requires employees to accurately record all time worked (the start and stop times), as well as the start and stop time for meal periods. The policy should clearly prohibit off-the-clock work. It is important to also address meals and rest periods provided by the company.

Technology and communications policies are increasingly necessary. It’s important that an employer indicate that the materials stored and communicated on devices owned by the employer belong to the employer, and it has the right to review and monitor those communications at its discretion.

There’s a lot of attention on bring-your-own-device workplaces. Employers need to communicate that work-related mobile activity is not private and information can be retrieved from a personal device including when the employee exits the company.

Is an employee handbook required?

Companies don’t need to have a handbook, but having one allows them to set forth some essential policies and employee rights and obligations that should be observed.  Handbooks enable everyone to have a reference to their rights and obligations.

What will suffice as notice in place of a handbook?

You can provide individual policies. Employers often provide new hires with the policy regarding sexual harassment, or there can be a separate meal and rest period policy. There is other information that must be provided to employees through permanent postings at the workplace or handouts.

Who should assemble the handbook?

An employment attorney is a good resource. He or she will typically have a model handbook that can provide a starting point that’s then customized to suit the employer’s needs. The chamber of commerce or an HR consultant have similar resources.

However, a big part of employers preparing a handbook is for them to become aware of their obligations and rights so they might better order their employment policies to protect themselves. It’s a good education tool and a chance for an employer to order its thoughts on how it wants to treat its workforce. ●

Jeffrey Dinkin is a shareholder at Stradling Yocca Carlson & Rauth. Reach him at (949) 725-4000 or

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There’s a lot of opportunity for investors in Cleveland to fund up-and-coming technology companies.

“There’s a growing sense of entrepreneurship and innovation,” says Steve Haynes, managing partner at Glengary LLC. “It has become the norm for colleges, universities, hospitals and other institutions to think about monetizing the technology developed in their facilities. They’re getting research dollars and they’re trying to convert science into something commercial. In addition to institutional technology transfer, incubators, accelerators, etc., are being formed to drive economic development.”

Patrick R. Roche, a partner at Fay Sharpe LLP, adds that there are many companies in the area looking to assist the right companies with capitalization.

“It’s very competitive — there are a lot of deals to be looked at,” he says.

While the market is fertile with both investors and entrepreneurs, Roche and Haynes say there are many things entrepreneurs fail to account for when seeking funding, including the viability and strength of their intellectual property (IP).

Smart Business spoke with Roche and Haynes about what investors look for in entrepreneurs’ IP before a deal can be done.

What does an investor look for in the IP of an entrepreneur seeking funding?

From an investor’s perspective, when an entrepreneur approaches with an idea the investor has to ask, ‘Will this idea have value in the marketplace?’ If yes, then one of the next questions is whether it can be protected, from an IP perspective. Otherwise, releasing it into the public creates a marketplace for anyone who can reproduce it. Then it becomes a marketing game, and early-stage companies don’t have the money to compete with well-capitalized competitors.

From an IP attorney’s perspective, basic due diligence dictates that a business owner or entrepreneur should present to the attorney what he or she thinks is the IP, so it can be analyzed.

It’s important to know when a patent application was filed and whether foreign rights have been preserved. The IP attorney, working on behalf of the investor, will examine in detail what the U.S. Patent and Trademark Office has done with the application and conduct his or her own research to try and predict what the patent office might do with it, called a patentability study. If it’s determined the patent application has little chance of being granted, that will likely kill the deal.

Patent attorneys also are looking at whether the invention can be designed around. Can noninfringing copycat products be created that could hurt the market?

What commonly turns an investor away from a fund applicant?

At an early stage, many of the potential obstacles for investors relate to whether or not there’s IP protection, both legal and otherwise. The strength of that protection is determined by identifying the difference between the applicant’s invention and prior art — the new invention has to be a nonobvious improvement over the state of the art.

Another part of the due diligence analysis is to determine if there’s an obstruction to the right to practice or use the invention freely in the market. It’s dangerous if it’s necessary to get a license from another party to sell a product in order to avoid infringing.

How can entrepreneurs best prepare before pursuing funders?

Entrepreneurs should check their IP ahead of time. Patent applications need to be filed, research should have been conducted, and their novelty and any likely obstructions identified and clearly understood. Investors need to see a thoughtful canvassing of the principal issues that an investor needs cleared. If the efforts of the entrepreneur are consistent with the IP attorney’s findings, and the entrepreneur is honest and truthful with the potential investor, the momentum carries through to a deal.

There’s not much worse than when an entrepreneur says they have a patent and it’s just a provisional application; the person hasn’t done any research and is just hoping everything works out.

It’s understood that every nickel is precious when a company is in the early stages, but it’s important that a company conducts thorough research on its IP before seeking funding.

Patrick R. Roche is a partner at Fay Sharpe LLP. Reach him at (216) 363-9000 or

Steve Haynes is managing partner at Glengary LLC. Reach him at (216) 378-9200 or

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