If you’re still waiting to see how the Internet will truly affect your industry before buying into the promised e-revolution, there is a good chance you’re quickly falling behind the pack.

Even as you read these words, there are companies trying to figure out how to do what you do, only better, and plan to use the rapidly evolving connected economy to chip away at your customer base.

That should be a chilling prospect for business owners still holding onto a wait-and-see attitude toward the Internet. Neil Goldman, a Senior Manager of High Growth Consulting for Ernst & Young, spends much of his time convincing business owners, especially old-line manufacturers, that the Internet isn’t just for multimillion dot-coms anymore.

In fact, striking early could be the engine that drives even the most traditional companies to new levels of growth.

“Unless you’re gearing up to conduct at least some of your business this way, you’re going to be left in the dust,” says Goldman, who promises that the true business Internet revolution has yet to hit its stride. “When it happens, you’re not going to have the luxury of six months to a year to figure it out.”

Reluctance to embrace the Net is likely fueled by the fact that doing so means going much deeper than simply placing a product catalog on the Web. The bottom line is that the Internet can revolutionize every aspect of your business, from supply chain management to customer service. That can be an intimidating, if not frightening, prospect for the uninitiated.

“So many people I talk to are overwhelmed by the clutter,” Goldman says. “They get hit by so many assertions and so many frameworks from so many directions. It’s difficult to continue to run a business, run it profitably and also get your arms around what’s really going on here.”

It is that mindset that makes people reluctant to integrate the Web into their everyday business process, but as Goldman says, this is no time to flinch. For wary business owners still hashing out what role their companies will play in the inevitable digital future, Goldman offers a few pieces of advice.

Realize that the rules have changed

The question is no longer whether the Internet will change business. It’s already happened. Once you embrace that fact, it becomes a little easier to think about how you can start using the Net to improve your business.

“Executives must adopt the paradigm that the Internet economy has changed, not is changing or will change, but has already changed, the operating rules,” says Goldman.

Reshape your business model

Merging the Internet with your business doesn’t mean simply dumping money into technology upgrades. It means looking at how the connectivity can improve existing relationships with your customers, suppliers and employees.

“Any time you undertake a transformation like this for a business, it’s not just about what the MIS department does,” says Goldman. “It impacts how top management communicates their vision and sets direction and negotiates their needs with customers and suppliers.”

The key is to make sure that your business strategy and your Internet strategy are wound tightly around each other. That may mean restructuring your business model to some degree.

“You need to make sure that your e-strategy is part and parcel of your overall business strategy and vice versa, and that you are proactively building the capabilities both technically as well as operationally,” explains Goldman. “You need to connect up in a way that is much less a way to create a competitive advantage than it is simple survival.”

Map your competitors, your trading partners and yourself

While you’re busy adapting your business to this new economy, don’t forget that your competitors and suppliers are doing the same. Before investing lots of time or money in your company’s Internet strategy, look to see where other players in your industry, especially the people you deal with on a regular basis, are placing their bets.

“Map yourself, your competitors and your trading partners,” says Goldman. “When I say trading partners, I mean both historical and new threats. Map them across how they are approaching new marketplaces, connecting with their customers, rebuilding their supply chain into a Web and supporting their employees.”

Decide what role your business will play

Even after spending a great deal of time drafting an Internet strategy, Goldman says many business owners still suffer from “analysis paralysis.” All the research in the world isn’t going to do you much good if you fail to act.

Think waiting another six months would be a better plan? Goldman advises starting now and modifying your Internet initiatives as you go.

“If you wait six months to make your first decision in this space, you won’t be as smart as if you had made several decisions over the same six months, made some mistakes, but made some right moves as well,” he says.

Goldman suggests investing in several Internet initiatives and moving forward with them after securing the help of some sort of business adviser.

“Part of your strategy need to be developing a small portfolio of initiatives,” he says. “No different than (the fact that) anyone who’s investing in dot-coms is not going to buy just one they think is going to be a high flyer, they’re going to buy several.

“Some of their stock prices may go down, but there are going to be one or two that do really well, and you’re going to succeed.”

How to reach: Ernst & Young LLP, www.ey.com

Jim Vickers (jvickers@sbnnet.com) is an associate editor at SBN.

Published in Cleveland
Monday, 22 July 2002 09:40

Mind your manners

It's always a tough decision. Do you try to spear that cherry tomato on your salad plate and risk shooting it across the table?

If there's a business deal at stake, you're probably better off leaving it alone or learning how to safely corral the little red menace.

It sounds trivial, but the fact of the matter is etiquette faux pas can ruin weeks of negotiations. Your dining etiquette is a direct reflection of you and your organization.

"Etiquette is extremely important, especially if it's with international clients," says Sue Fox, president of Etiquette Survival Inc. and author of "Etiquette for Dummies." "There is tons of business being done over meals. It is a product of our overworked society. What you need to do if the meeting is important is to follow the Boy Scout motto and be prepared."

 

* Find out if your clients or customers have any special food needs. Are they vegetarian? Find out where they are staying and choose a restaurant near their hotel.

 

* Try to frequent a restaurant where you are known so you'll get better service.

 

* Call ahead and make arrangements for a quiet table. If you are the host, give the manager your credit card number in advance, and, if possible, sign for the meal. This makes the whole event run smoother and eliminates any possible bickering over the bill.

 

* Don't talk business until after you are done eating the main entree. The only exception is if your guest brings it up first.

 

* Don't order food that is difficult to eat, such as spaghetti.

 

* Be prepared with small talk about current events or other topics.

 

* Turn off your technology, including cell phones and beepers.

 

* Don't put anything on the table, including sunglasses and keys. The only thing that should be on the table are the plates and the meal. Once the business discussion starts, it's acceptable to bring out papers and other related materials.

 

* Learn more about proper etiquette. Sticking a napkin in your shirt and talking with your mouth full might be accepted at your mother-in-law's, but it's not going to help you win any business deals.

 

* Greet your guess at the door, which means arriving early. Walk in ahead of them, lead them to the table and indicate where everyone should sit. You may want certain people in specific spots, but always give the best seat to the most important client.

 

And here are Fox's five worst mistakes that can be committed during a business meal:

1. Drinking too much alcohol.

2. Having a long cell phone conversation at the table.

3. Showing up late.

4. Spilling something on your client.

5. Dominating the conversation. How to reach: Sue Fox, www.etiquettesurvival.com. Fox's etiquette advice columns are also available at www.officeclick.com.

 

Todd Shryock (tshryock@sbnnet.com) is SBN's special reports editor.

 

Published in Philadelphia
Monday, 22 July 2002 09:40

The right fit

The right fit

Who is a good candidate for the Western Pennsylvania Adventure Fund? President and CEO G. Richard Patton offers some advice to would-be early-stage venture capital seekers. You must:

  • Be a Western Pennsylvania-based entrepreneur.

  • Have a business proposition that is similar to others the fund has invested in.

  • Be specific about why you are looking for financing. If you say you need $1 million to finish a prototype and verify market acceptance to prepare for a $10 million follow-up round, you're more likely to get the fund's attention.

  • Recruit advisory board members and professional services that will bring credibility to your company. Investors like to see names they recognize associated with investment opportunities.

Patton suggests entrepreneurs should research potential venture firms. Don't do mass mailings of your business plan and, he adds, get someone with some clout to make introductions."Find someone who can be a reference," says Patton. "Anything you can do to get away from cold-calling will add a lot of credibility."

Ray Marano

Published in Pittsburgh
Monday, 22 July 2002 09:39

Automated HR

People are a company's most important resource; however, many organizations are unable to generate up-to-date information such as employee turnover rates, employee training needs, costs to hire employees and skills gaps between the current and desired work force.

All of this information is critical if a company wants to compete in today's market.

Many companies have automated most of their business processes, including finance and manufacturing, to maintain their competitiveness in a fast-paced environment. What about the human resources function? How can a human resources information system (HRIS) benefit the bottom line?

 

Improved information retrieval. Companies must cope with the constant demand for information from the government, the management team and employees. Once the system is up and running, a company can retrieve quickly information such as labor costs, government required reports and employee data. This reduces the time spent retrieving information and increases accuracy.

 

Reduction in labor costs. An HRIS operates from a single database that serves all HR functions: payroll, benefits administration, HR management, recruiting and training. There is no need to enter employee information in HR records, then again in payroll. Employee data is entered and updated just once for all functions, reducing errors and cutting down on clerical time.

 

Simplified benefits administration. Many time-consuming benefits operations (tracking entitlements, notifying employees of coverage options and costs, etc.) are handled automatically by an HRIS. Costs associated with regulatory compliance are kept to a minimum, with immediate bottom line gain.

 

Instant development of government required reports. An HRIS generates standard reports that meet government requirements. The system guides the company in complying with EEO, OSHA, Workers' Compensation, Affirmative Action and other government regulations with no errors and in less time compared to handling these functions manually.

 

Improved service to key customers. Questions are answered faster and more accurately. Reports can be printed that detail information employees commonly ask for, such as benefit and wage information. Managers can quickly access performance reviews, pay and job history to help them make key decisions. Less time is spent searching for data through multiple files and spreadsheets, and both management and employees can focus more time on value-added activities.

 

Key information provided for strategic planning. An HRIS enables your company to be responsive to strategic needs. Customized reports support analysis, forecasting and planning. The information your company needs to formulate and modify strategy is easily accessible.

 

With an effective HRIS, a company can manage both the day-to-day administration of human resources and the deeper level of strategy. Both the short-term and long-term benefits of using an HRIS have a positive impact on your company's bottom line.

Michelle Salis is a senior consultant for HR Consulting, an affiliate company of Bruner-Cox. She can be reached at (330) 498-0897.

Published in Akron/Canton
Monday, 22 July 2002 09:39

Vickie Hutchins & JoAnn Martin

While many business partnerships fail when oversized egos get in the way, Gooseberry Patch owners Vickie Hutchins and JoAnn Martin say partnering is what makes their company work.

“I don’t know that either of us would have hung in here this long if we were by ourselves,” says Hutchins.

Sixteen years ago, the duo started the Delaware mail order business from a mutual love of country decorating and antiques. With an initial investment of $5,000 apiece, they took no income for three years. In 1990, they hit the $1 million sales mark, and the company grew at about 30 percent a year after that. They expected sales to reach nearly $15 million at the close of the fiscal year last month.

As in most successful partnerships, Hutchins and Martin have complementary skills. Hutchins handles the creative aspect of the business, particularly catalog design and cookbooks, while Martin manages more of the day-to-day operations. Yet each crosses over from time to time, and neither is territorial when it comes to getting things done.

“We can divvy up the crummy jobs and the fun ones,” says Martin.

And neither gloats over a good decision — nor plays the blame game over a bad one — like the time they tried to sell the bowl with the floating candles.

“We’ve still got quite a few of them,” says Martin with a chuckle.

“Maybe it was because the candles were shaped like rocks,” adds Hutchins. “We’ve been trying to donate the bowls to schools to use as terrariums, but you really can’t donate them because they’re so breakable.”

But the pair thinks they’re on target most of the time when it comes to picking just the right products for their customers — typically well-educated women between the ages of 35 and 55. And they contend they’re selling more than simply products in their whimsical catalog pages.

“I think the catalog is about comfort, family, friendship and sharing,” says Hutchins. “It brings to people’s lives a little something they’re missing.”

The duo also has a shared commitment to providing extra-friendly service to their customers. Gooseberry’s “personal shoppers,” telephone operators whose numbers swell to 25 in the months before Christmas, are given extensive training not only in taking orders in a chatty way, but also in becoming experts in Gooseberry’s cozy product line — from layered cookie mixes to bubble lights. Each year, the catalog features about 200 new products.

The pair, winner of Ernst & Young’s Columbus and Central Ohio Retail Entrepreneur of the Year Award in 1995, says the newest challenge is finding enough creative people to add to their in-house staff of illustrators, copywriters and graphic designers. They say Gooseberry’s laid-back atmosphere, replete with scented candles and potpourri, may be difficult for those who prefer a corporate ladder.

“A lot of people can’t go with the flow and be flexible and spontaneous,” says Martin. “The lack of creative talent is determining our growth, which gets frustrating because we have so many ideas and so much we want to do.”

But Hutchins and Martin are confident that they’ll continue to build their business in the relaxed, non-competitive way they always have.

“I don’t think we’ve ever lost sight of what it is we’re here for and what it is we want to do,” says Hutchins. “I don’t think it’s ever changed; it’s evolved.”

Muntaqima Abdur-Rashid is a Columbus-based free-lance writer.

Published in Columbus
Monday, 22 July 2002 09:39

Coordinators are for closers

To save a few jobs after selling a second location, one Central Ohio businessman created what has become a model support system, allowing sales reps to reach more potential customers while still servicing existing clients.

The jobs Jim Dixon Sr. saved at Val-Pak of Central Ohio are now called sales coordinator positions, and the people who fill them help the sales reps at his nearly $6 million business increase sales, as well as customer satisfaction.

They do this by servicing existing customers — which account for 80 percent of Val-Pak’s business — while sales reps focus on building on the remaining 20 percent.

“We expect them to bill at 10 percent more each mailing vs. the [same month’s] mailing a year earlier,” explains Dixon, who owns the Columbus-based franchise that mails consumer coupons monthly to more than 500,000 homes in Franklin, Delaware, Fairfield, Licking, Madison, Marion and Union counties.

Dixon used to own a Val-Pak franchise in Dayton, which he sold in 1994, leaving him with extra support staff in Columbus. This extra staff understood the business, Dixon says, so he didn’t want to get rid of them. They were detailed people who could help a sales rep approve client coupon artwork, coordinate billing and collections, and answer client questions more quickly than a sales rep who is typically out of the office.

“Sales reps are good at getting sales,” Dixon says. “But a highly detailed person is much better for the customer in the long term.”

It’s also proving to be better for Dixon’s company. The sales coordinator is part of a business plan that has allowed Val-Pak of Central Ohio to double its sales in six years.

“When we made the change, we were at about $2.5 million in sales,” Dixon says.

Last year, the company reached $5 million in revenues. This year, Dixon is expecting to boost that total by another million.

Dixon has also increased the frequency of Val-Pak’s mailings since 1994, going from eight to 12 times a year — without increasing his staff. Only now is he beginning to hire more sales reps and sales coordinators.

Dixon says his Val-Pak franchise sales are double that of any sister franchise now.

“I have to attribute a lot of that to our sales coordinators,” he says. “We have such good sales reps, but they can do so much more because of the sales coordinators. Our sales reps are twice as productive.”

Here’s how he does it.

Affording a coordinator

Dixon determined that once a rep was producing $35,000 a month in sales, that person would be assigned a sales coordinator. Generally, one coordinator assists two sales reps. It takes 3 percent of the reps’ total monthly sales to cover the coordinator’s salary. If a rep with a sales coordinator cannot increase sales beyond $35,000 a month, then the rep loses the coordinator.

The objective is for both sales reps to sell in the neighborhood of $50,000 a month each, he explains. When the sales coordinator handles more than $70,000 a month, the coordinator benefits with a 3 percent commission on the additional sales. Coordinators can make up to $40,000 a year on this plan, he adds.

Initially, Dixon’s reps were hesitant about using sales coordinators.

“They were extremely nervous about allowing anyone else to talk to their customers,” he says. “They were afraid about losing customers. If the sales coordinator says the wrong thing, they might lose the sale. Sales people, in general, are paranoid and have difficulty accepting any change.

“It was difficult to turn them over initially, but now they know it makes the relationship stronger.”

Jennifer Mills has been a sales rep with Val-Pak since January 1996. After 18 months, she qualified to work with a coordinator.

“I still do a lot of the [ad] layouts and getting proofs approved and collection calls,” Mills says. “But my sales coordinator helps to organize everything and finds more efficient ways of getting things accomplished.”

“It has made a big difference in my business just from stress management alone,” she adds, noting she has 117 active accounts that mail almost on a monthly basis. Mills also is working outside the office four days a week.

“My billing has always continued to increase significantly from year to year and I attribute a large proportion of that to the help I get with a sales coordinator,” she says. “It’s pretty essential to managing a large account base effectively.”

That doesn’t mean sales reps leave all customer care to the sales coordinators. Dixon says his franchise hosts golf and ski outings where sales reps and customers see each other and sales reps still stop by their clients’ businesses when they’re in the area and it’s convenient.

“It will vary,” Dixon says, “but at least every six months we want the rep in there saying, ‘Hello,’ and making sure the customer is happy.”

Dixon’s business model using the sales coordinator position is so successful that it is replicated at other Val-Pak franchises, which number more than 300 in North America.

“Obviously, as a company, it gives [us] a more solid relationship with the account,” he says. “If the sales rep leaves, we have another person still on the account and in a relationship. For the rep, the dividends are greater and more immediate.”

How to reach: Val-Pak of Central Ohio, valpak.com or 486-7168, ext. 135

Andria Segedy (aesegedy@sprintmail.com)is a free-lance writer for SBN.

Published in Columbus
Monday, 22 July 2002 09:38

Web watch

Easy-to-use Web sites with free information to help you manage your business

www.whatsnu.com

The name just about says it all. This site displays all of the URLs posted within the last 24 hours, organized by topic and category. And you can subscribe to an e-mail newsletter to receive information in your areas of interest. Subscribers receive a free weekly newsletter notifying them of new Web sites being launched . The search engine accepts URLs and filters new Web site submissions by date and/or category.

www.score.org

The Service Corps of Retired Executives has beefed up its site, offering a revised version of its online counseling, success stories and a content-rich resource center that doles out information on business planning, human resources, legal matters and more. Online counseling puts you in touch with seasoned business pros who answer questions via e-mail. Business professionals, authors and entrepreneurs offer their wisdom and comment on the latest trends in the guest feature section.

www.entreworld.org

Entrepreneurs offer advice on topics from business valuation to marketing to growing your company. The site provides a free e-mail newsletter, a Top Advisors in which experts give valuable how-to information, and discussion groups that connect entrepreneurs, academics and service providers.

www.home.cnet.com

Arranged like many of the popular search engines, CNET.com offers hardware and software reviews, Web site building information, the latest pricing information on equipment, Internet tools and more. TechNews offers the latest scoops in the technology industry. Investors can get stock quotes, product recommendations and how-tos.

Published in Pittsburgh
Monday, 22 July 2002 09:38

Airing it out

A little more than a year ago, West Penn Airport was a tiny, obscure, public-use airstrip known only to a close-knit group of flying enthusiasts.

Then, one day, everything changed. Suddenly, that little airstrip and the property surrounding it were propelled into massive economic development that made even the governor's office sit up and take notice.

That was the day Rock Ferrone flew over it.

Ferrone, president and owner of printing industry equipment manufacturer Rock-Built, simply wanted a place to land and keep his four-seater Cessna. So when he found out the airport's owner wanted to sell, he couldn't resist. He also couldn't sit still.

Ferrone didn't see just a tiny airstrip. He envisioned an entire business community built around a slick, new airstrip, with business owners flying in and out all day long. And he saw himself leading the way.

If skeptics existed back then, when he started articulating his high-flying ideas to anyone who would listen, they're gone now, thanks in large part to the giant earth movers, bulldozers and dump trucks that have begun to reshape the land around the airstrip. The earth-moving equipment is preparing the land for a 270-acre office park, which he has named Rockpointe Business Airpark.

Ferrone, with help from Pennsylvania Lieutenant Gov. Mark Schweiker and a host of other local dignitaries, recently kicked off the development with a ground-breaking ceremony. However, Ferrone himself has been breaking new ground, figuratively, for the past year as he works every state and federal government angle in his efforts to talk up the project. He was also trying to line up early funding for a project which he predicts will cost about $30 million before it's all finished.

His efforts have landed him as a poster boy of sorts for general aviation-driven economic development in the state as he cuts through bureaucracy with speed and a welcomed sense of wide-eyed naivete. In fact, he managed to convince not only state officials but township and school district officials as well that his development project was worth getting behind.

As a result, the combined taxing bodies have designated Ferrone's site as a Keystone Opportunity Zone, a program launched last year which allows businesses to locate to the site free of local, school and state taxes for 12 years. Ten-and-a-half years remain on that program, compelling Ferrone to forge ahead even more aggressively than before.

Said Schweiker at the event: "Suddenly we stand here looking at the soon-to-be-developed 300-acre airport industrial park. Together, there's no stopping Allegheny County. There's no stopping Pennsylvania."

Rita Pollock, executive director of the economic development and planning agency SPC, sums up Ferrone's efforts simply.

"He's an absolute dynamo," she says of Ferrone. "You don't see people like Rock Ferrone who are so driven and so active. There's something about him. He's such a good guy. And this project is outstanding, because it combines general aviation and industrial sites. It's so clearly a winning opportunity."

Mulugetta Birru, county development director for Allegheny County at the time of the ground-breaking, adds: "He has the energy to move a mountain."

In a very real sense, that's just what Ferrone and the earth-moving crew are doing. They are preparing the land for a new airstrip that will extend 5,000 feet --almost double the size of the existing strip -- and be 100 feet in width. Plans also call for a new terminal building, which will house a restaurant and fuel service company for aircraft, as well as facilities for the two flying clubs that use the airport.

The airstrip and terminal ultimately will be turned over to a public authority as a requirement of receiving state and federal grants that are available to improve public-use airports.

But the biggest part of the development is the rest of the land surrounding the airport, which Ferrone hopes to turn into a parklike office complex housing 30 to 40 businesses and providing amenities such as a walking trail, a golf course and even racquetball, to name a few.

"I want it to be a country club environment," Ferrone says.

Ferrone has secured a significant development commitment from Zambrano Corp., which has known the Ferrone family for years, according to Eugene Zambrano III, vice president of Zambrano Corp. and a general partner in the firm's commercial real estate holdings. Zambrano, which provides commercial construction services, owns 16 commercial and residential buildings throughout the Pittsburgh area, including a 70-unit high-rise in Leetsdale, a 10-story, 100,000-square-foot building in Monroeville and a 50,000-square-foot commercial/industrial building in the RIDC Park in O'Hara Township.

"What we bring to the deal is 40-plus years and tons of real estate development credibility," Zambrano says.

For starters, Zambrano plans to build a 25,000-square-foot headquarters building for its own company, which currently is located in Sharpsburg. The firm is doing so on a five-acre parcel it purchased from Ferrone. Zambrano says the company will use three of the acres for its headquarters and the other two for other "real estate investment."

Zambrano says he reacquainted himself with Ferrone last year after seeing a cover story about him in the November issue of SBN. From that point, Ferrone took him for a ride to the airport for an early look.

"As soon as we drove up there last November, it's like I got it -- I understood," Zambrano says of Ferrone's vision for the property. "He's a fireball and a great entrepreneur."

Zambrano and Ferrone also have entered into an agreement to jointly develop a 52,000-square-foot flex-space office building on speculation and are in discussions for others.

Moreover, Zambrano Corp. is in line to provide construction services for any third-party developers who plan to purchase land in the air park for office buildings. Zambrano won't disclose specifics, but he says he's in discussions with at least seven people who have expressed an interest in building.

Says Zambrano: "Right now the action is fast and furious." Ferrone, himself, plans to build a new headquarters and manufacturing facility there for Rock-Built sometime "in the middle of next year." He also has plans to build a new home on the property which would allow him to taxi from the runway right to his home. Daniel Bates (dbates@sbnnet.com) is editor of SBN.

Published in Pittsburgh
Monday, 22 July 2002 09:38

A Class-A Gimbels

It's amazing what $50 million, the removal of 25,000 tons of debris and a little attention to historic detail can do for an old department store building in the heart of downtown Pittsburgh.

That's what it's taking to transform an 86-year-old building, which has far outlived its original intent as a sprawling, 14-floor urban shopping experience, into one of the region's most colorful -- and state-of-the-art -- Class-A office buildings. It's a model of what can be done downtown to bring old, architecturally significant buildings into the 21st century.

The Gimbels building, designed by architectural firm Starrett and Van Vleck of New York City (the same firm that designed Lord & Taylor at about the same time), was built at the corner of Sixth Avenue and Smithfield Street in 1914. The building was constructed with structural steel covered with hard-baked clay tile, with a façade of brick and custom-made terra cotta tile moldings and other details.

A building in decline

For years, Gimbels served the region as a major department store, along with Joseph Hornes Co. and Kaufmann's, before succumbing to economic times that were driven largely by suburban shopping malls. Gimbels closed in 1986 and remained vacant until 1992, when a New York-based real estate investor named Richard Penzer bought it and slowly began a transformation.

His efforts brought in anchor retailers Burlington Coat Factory and, later, Barnes and Noble Bookstores, along with a few others on the building's lower floors, bringing it up to roughly 30 percent occupancy.

But it wasn't until members of the Rudolph family, which used to own the Wendy's restaurant franchise in Pittsburgh, and members of the Perlow family (the late Ed Perlow helped start Interstate Hotels), created a partnership to purchase the building last year that its future began to take shape. The partnership bought the building for a reported $15.5 million.

Then, with help from tax increment financing approved by Allegheny County, the City of Pittsburgh and the Pittsburgh School District, the owners embarked on what ultimately would become a $50 million transformation process.

No ordinary renovation

It wasn't just your typical old-building conversion into trendy, if not quaint, new office space. The owners envisioned a Class-A office building which, while showcasing the historic façade, would offer state-of-the-art accommodations for 21st century businesses. Such state-of-the-art amenities would begin with a hard-to-find floor plate of 45,000 square feet per floor -- more than an acre of space on each floor.

"Tenants around the country are looking for large, efficient floor plates," says Jeremy Kronman, a real estate consultant and leasing agent for Oxford Realty Services, which manages the building and its leasing efforts. "But to get a location in the city, you need to go to either an old building, such as a department store or warehouse, or build a new one. Here, we have the best of both worlds, with the combination of an historic outside and a high-tech inside -- and right in the heart of downtown.

"That's what makes this project so exciting."

The owners launched their transformation effort by renaming the building Gimbels Landmark. Then they enlisted the services of Pittsburgh-based architectural firm Burt Hill Kosar & Rittelmann, Architects, which set out to design a floor plan that would meet Class-A standards while also adhering to strict building and renovation standards set by the Pennsylvania Historical Commission and the U.S. National Park Service. Those agencies are involved because of special financing incentives which are tied to historic preservation of the building's façade.

That posed a number of challenges, according to Gary MacDowell, an executive from John Deklewa & Sons, Contractor, who served as construction manager for the project. For instance, the building's windows, made by Traco, could be made of aluminum, but they had to be designed to replicate the style of the original windows.

But when they were installed, a Park Service inspector decided the aluminum was too noticeable on the lower levels. So the owners had to resort to new windows made of wood for those floors.

Moreover, more than 500 pieces of glazed terra cotta tile representing 12 designs had to be matched and replaced. Even the type of solution used to clean the building was determined by the Park Service (Ivory dishwashing detergent), along with the level of water pressure in the pressure washers.

But, as MacDowell says, "In general, everybody has to realize that the Gimbels building will be the nicest office building in town. It's a rock-solid building that offers the best of both worlds."

High-tech insides

Inside, contractors have rebuilt the elevators, installing Otis Elevonics control equipment, which not only makes them faster but, as MacDowell says, automatically measures usage patterns and programs their positions throughout the day. Contractors also are installing a 12,000-volt electrical system that offers what MacDowell describes as triple redundancy aimed at protecting computers and other related equipment that prove sensitive to power surges and outages.

If one line shuts off, the additional lines will switch on in an instant, he says. Reaction time in switching lines on the current system is about an hour or so. Duquesne Light Co. is providing the fail-safe electrical system.

Then there's the heating and cooling system. MacDowell says it's the most flexible available, using an open-loop, closed-loop system that exchanges water that comes from cooling towers on the building's roof. The system will automatically adjust the temperature in any given area of the building, depending on worker preferences as well as variables such as where the sun is shining throughout the day.

The crowning feature

The signature feature in the building, though, is the seven-story atrium punched out of the center of the building and capped by a fancy glass-paneled dome That posed the most significant challenge of the project, since the building was already accommodating a few tenants on the bottom three floors.

All told, workers and bulldozers gathered up about 25,000 tons of concrete, brick, reinforcement rods and other debris, mostly after working hours, and funnel it all down a small chute on Strawberry Way, where tandem dump trucks lined up night after night.

"They hauled away thousands of truckloads," MacDowell says. "But the most difficult aspect was making sure there was safe construction."

In addition, the building features a top-floor outdoor garden courtyard, although MacDowell says it's not clear yet whether that courtyard will become a common for all tenants or accessible only to a tenant that occupies the top floor.

Space available

MacDowell expects the construction to be completed by the end of September. Meanwhile, Oxford Realty Services has been hard at work lining up tenants.

Kronman says the asking price is "in excess of $20" a square foot, which, he adds, is still about 10 percent lower in price than other Class-A offices in downtown Pittsburgh.

At the moment, United Healthcare occupies more than 60,000 square feet and the Port Authority of Allegheny County is moving its executive and other offices into more than 70,000 square feet. The Duquesne Club, which occupies an adjacent building on Sixth Avenue, has expanded its health club and other facilities into a larger space in the Gimbels building.

Kronman expects it to be at more than 65 percent occupancy when it is completed, with most tenants taking advantage of the large floor plate. However, the owners expect to offer smaller spaces as well -- as little as 2,000 square feet -- on some floors.

To market the building, Kronman says the owners and building managers have stuck with the 21st century theme, providing an extensive Web site (www.gimbelslandmark.com) instead of a hard-copy brochure. The site comes complete with artists' renderings, photos, news and information -- and an award-winning virtual tour of the building designed to collect information about the person doing the virtual walk-through.

"It's fun marketing a truly 21st century building, which this has become," Kronman says. "It's an exciting project. It's a world-class renovation, and there's nothing like this in Pittsburgh." How to reach: Oxford Realty Services, (412) 261-0200

Daniel Bates (dbates@sbnnet.com) is the editor of SBN magazine.

Published in Pittsburgh
Monday, 22 July 2002 09:38

Guiding the green

Growing professionally is a continuous process at Squire, Sanders & Dempsey LLP.

With corporate offices in Cleveland and more than 550 attorneys and 20 offices in cities around the world, including Columbus, SS&D offers several training programs to help guide the careers of its associates.

"Business development is not a skill that you learn in college or law school," says Alex Shumate, SS&D's managing partner in Columbus. "It's a mindset that you develop over the course of your experience. As Squire, Sanders & Dempsey LLP is committed to lifelong learning for all associates and partners, we take an active role to ensure that they receive the resources necessary to ensure personal and professional growth."

An example of that commitment is SS&D's monthly New Associate Training sessions. Topics such as "Accepting Assignments & Managing Your Workload" and "Public Service Work and Community Activities" help new attorneys learn over a span of nine months about the mechanics and culture of the legal profession.

Karen Winters, a partner in the Columbus office who teaches a session in associate evaluation, says SS&D's orientation program gives new hires a sense of the whole.

"It's largely informational," she explains. "We want new associates to know about all of the services the office has to offer to make their jobs easier. They also need to be familiar with substantive areas of the law which they may need to interact with to provide quality legal services to a client."

To help meet these goals, Winters says, new associates are trained in using the firm's technology to conduct advanced legal research and attend presentations given by SS&D attorneys who specialize in such areas as tax, public or environmental law.

Another example of the firm's commitment to training is "SS&D University," typically a two-day workshop at which a panel of SS&D partners provides new associates with an overview of the firm's markets and plans for the future, guides them in developing personal business development plans and gives them pointers on bolstering client relationships.

Three years ago, SS&D began a bimonthly training program aimed at helping its mid- to senior-level associates better market their services. Working with groups of 10 associates at a time, the Business Development Group includes senior partners in the firm who share their experiences in maintaining and enhancing client relationships and generating new business opportunities.

As part of the same initiative, SS&D brings in outside speakers, including public relations strategists who discuss ways to build relationships and enhance image and reputation, and past clients to share the factors they use in selecting outside counsel.

SS&D sees training as an investment in its future, Shumate says. "We realize that it is imperative to invest time further developing our young associates and their continued growth, for they are the future of our business," he says. "They appreciate the level to which we focus upon their continued success. Ultimately, as they grow, generate new business and establish sound client relationships, they bring success to the firm as a whole." How to reach: Squire, Sanders & Dempsey LLP, www.ssd.com, 365-2700

Muntaqima Abdur-Rashid is a Columbus-based free-lance writer.

Published in Columbus