It's even more impressive when you consider that this is a company that went from a two-man messenger and small package delivery service for local shops in Seattle to a $32 billion supply chain management business that serves 200 countries and employs more than 360,000 people -- just 50,000 shy of the population of the city of Atlanta.
The man behind much of that international expansion is Michael L. Eskew, who in January 2002 was named chairman and CEO of United Parcel Service Inc.
Eskew was part of the team that initially expanded UPS into Europe in 1976, helped begin the company's first intercontinental air service between the United States and Europe, and led the campaign to launch UPS's own airline, which today is the 10th-largest airline in the United States with 257 of its own planes and 315 chartered aircraft.
Although he's been CEO for less than two years, Eskew has long been a vocal advocate of embracing the rapidly expanding global marketplace. In his eyes, CEOs who want their companies to thrive can no longer just do business in their city, state or even country. Like it or not, it's time to get global or perish.
"We have large and small customers that are now doing business well beyond their natural trading borders," says Eskew. "What was only in Chicago in the past is now in Los Angeles, New York, China and London."
Crossing the sea
Eskew joined UPS in 1972 as a wide-eyed Purdue University graduate with a bachelor's degree in industrial engineering. After a few months of "laying out parking lots," as Eskew says, he donned the famous brown uniform and drove the brown delivery truck, which the company calls "package cars."
"They let me go out and deliver packages," Eskew wistfully recalls. "You never forget those great experiences of seeing what customers expect from us."
Eskew rose through the ranks during the '70s and '80s, watching as demand for air parcel delivery increased and federal deregulation of the airline industry created new opportunities for UPS. But deregulation also led established airlines to reduce the number of flights and abandon some routes altogether.
To avoid a delivery disruption, UPS began to assemble its own jet cargo fleet. As a result, its worldwide growth started to blossom.
By 1985, UPS Next Day Air service was available in 48 states and Puerto Rico. That same year, UPS began offering international air package and document service, linking the United States and six European nations. In 1988, under Eskew's direction, UPS received authorization from the Federal Aviation Administration to operate its own aircraft, thereby officially becoming an airline. Formed in less than a year, UPS Airlines became the fastest-growing carrier in FAA history.
In 1989, its international air service reached more than 180 countries. Just four years later, UPS reached 4 billion of the world's 6 billion people -- more than twice the number of people that can be reached by any telephone network.
"We've made our moves because the customers have asked us to take them there," says Eskew, explaining the strategy behind UPS's global expansion.
That strategy is relatively simple, he says, but it's not so easy to execute. Successful implementation lies in the consistency of UPS's operations, from Boston to Beijing, right down to how the trucks are loaded.
"If you would open the back of one of our package cars in Europe, you'd realize they look a lot like they do in the U.S.," Eskew says. "If I'm in Berlin, there's a package on the shelf that came on the ground from France, one that came in the air from France ... But it's an integrated network, all integrated and synchronized in the back of that package car."
This global expansion, however, has hardly been from the ground up. Since 1999, UPS has made at least 25 acquisitions of supply chain and logistics companies domestically and worldwide. The best known of these domestic acquisitions is the one of the 3,000 Mail Boxes Etc. stores, which most franchisees have renamed "The UPS Store."
Eskew says all acquisitions must meet three criteria -- the market must have the potential for growth; it has to leverage UPS skills such as its brand, technology, people or its information networks; and it has to fit UPS's strategy.
"Our strategy, simply stated, is to enable global commerce," Eskew says. "If we think it takes our customers around the world, gives them touch, makes them more successful, lets them do more things, that's our strategy. If those acquisitions meet all three of those guidelines, we're in the market."
Putting a face on UPS in these new markets, however, requires different marketing campaigns. In March, Eskew unveiled a redesign of the company's famous shield logo to go on the company's vehicles, facilities and uniforms worldwide. And its latest advertising tagline -- "What Can Brown Do For You?" -- has been successful domestically, but is not used everywhere.
"Markets develop differently in different lands," Eskew says. "In some lands, domestic markets are not as important and not as developed as they are here in the U.S. In some countries, the express market is not as developed as it is here as in the U.S. On the other hand, in some countries, we may enter as a supply chain player. In terms of our brand, our brand plays great all over the world, but our commercials are tailored to the country."
Eskew estimates supply chain management is a $3 trillion business worldwide, compared with the relatively paltry $60 billion U.S. small package delivery market. So it's no surprise that in the last decade, the UPS management team has diversified its services to include consulting and logistics, as well as a financing arm to fund supply chain projects for customers.
To support these new global initiatives, UPS has spent at least $1 billion a year for the last 15 years on technology, and Eskew says it will continue to do so. Its Web site, www.ups.com, is accessible in 21 languages and dialects, and contains dedicated content for 104 countries.
The result? Last year, operating profit more than doubled for the company's international segment.
"It's not just a trend, because it can't be stopped," Eskew says. "In the last two years, we've seen horrible terrorism, a war and various health threats. And none of it has stopped world commerce. Global trade has kept moving forward."
One word you won't hear out of Michael Eskew's mouth too often is "I." Every accomplishment, every achievement, begins with "We." When asked whom he admires in business, his answer is his employees and the eight CEOs who held the post before him.
"I've been at UPS for 31 years, so that's the only culture that I know," Eskew says. "We are a team company, and there are 360,000 of us. I don't deliver any packages myself anymore. I don't sort any of them and I don't develop technology or fly airplanes. It takes all 360,000 to make this place work.
"When all 360,000 understand where we're going to go and understand our vision and understand we're one company with one vision, we've pulled together great."
To illustrate the UPS culture, Eskew borrows a phrase from UPS founder Jim Casey, who in 1956 told his management team that they always needed to be "constructively dissatisfied."
"It's part of our DNA," Eskew says. "We don't want to run ourselves down, but we can never be satisfied, and that's really what it's all about. We've always had the best service, we've always had the best people in our industry, but we have to be constructively dissatisfied. We can get complacent, and Jim would not want us to be."
What also seems to be part of Eskew's DNA is the ability to adapt to change. From 1913, when Casey's American Messenger Service was nearly driven out of business due to improvements in telephone service and the automobile, to an increasingly global marketplace today, UPS under Eskew will need to be as nimble in the coming years.
Eskew is looking forward to it.
"A lot of people think they need to change jobs to see different things, and luckily for all of us at UPS, the company keeps changing," Eskew says. "We're not in the package delivery business anymore; we are a technology company, we're a supply chain company, we're an integrated, synchronized commerce company."
HOW TO REACH: UPS Inc., (800) 742-5877 or www.ups.com
Small business owners tend to think that once their website
is built, the job is done. They rarely look at the site critically again until
it is time for an overhaul several years later.
Smart Business spoke with Steven Vicinanza, Ph.D., CEO of
cloud computing provider BlueWave Computing LLC, for some tips on how to keep
the customer Web experience crisp and fresh.
Why is website maintenance important?
When your website falls into disrepair, customers come away
with a feeling that your company is not on top of its game. Especially in
service industries, delivering a quality Web experience can mean the difference
between winning and losing business. Why take a chance? Keeping a website in
good repair is a simple matter of putting a routine maintenance program in
What is the biggest issue with website maintenance?
The No. 1 issue with website maintenance is out of date
information. Forget about the fact that the last press release on the site is a
year or two old. I’m talking about the basics. A company moves to a new office,
yet the old address is still listed on the website. Pages showing discontinued
products or referencing personnel who no longer work at the company are other
Errors like that don’t put your firm in its best light, and
when a prospect shows up for a meeting at your old office, it won’t be fun
explaining that your site has the old address. So the first step in Web
maintenance is verifying that all information is current.
I often see ‘Page Not Found’ errors. Is that a
maintenance issue, as well?
Let’s say you have a page about a discontinued product and
as part of the maintenance you remove that page. You may not realize that there
are other links around that point back to that page. So now, when visitors
click on one of those they now get a ‘Page Not Found’ error message in place of
the missing page.
Even if your site has not changed at all, you may still have
bad links. Your website may have links that point to pages on other people’s
sites. If one of those other sites changes the location of a page, image or
file that you are linking to from your page, you will have an instant bad link.
Here are some of the ways a link can be bad:
pointing to sites that cannot be reached (no such site)
pointing to valid sites but with pages that cannot be reached
pointing to pages that are found but never load (timeout)
that point to pages that are found but are restricted by security
That’s why it’s important to check out the integrity of your
site’s links on a regular basis. If your site is small, you can do this by
opening your home page and following every link to ensure they are all working
as expected. For larger sites, manually checking can be tedious and error prone
so it’s best to use some type of automated tool. Google’s free online Webmaster
Tools are a good starting point. One of those tools is a site checker that
crawls through your site to identify any broken links.
Some pages seem to take a long time to load. Why is that?
We’ve all experienced frustratingly slow websites so you
already know what a turn-off that is for your clients and prospects. Why lose
business unnecessarily because of slowness that can be easily remedied?
There are many reasons why your site may be slow to load.
The most common include:
scaled image files
designed Web application
or host site network congestion
Some of these are intrinsic to your site design and static.
Others are dependent on server load, visitor traffic or network bandwidth and
change over time. Unless you are monitoring your site’s performance, you will
not be aware of these issues until it has already impacted your business. Here
at BlueWave Computing, we use specialized Web monitoring tools to measure site
responsiveness at five-minute intervals throughout the day. We can also measure
how long it takes each individual object on each page to load. That allows us
to find the bottlenecks and optimize the page load times.
How important is security on the website?
Every site connected to the Internet is prone to malicious
attacks. Whether hackers are looking to steal data, transmit viruses to your
visitors or just share their pirated videos with the world, you want to keep
them off your server. To do that, have a qualified professional regularly
review the site’s security settings and check the Web logs to ensure only authorized
areas and data on your site are being accessed.
By instituting a routine maintenance procedure that
incorporates these items, you’ll keep your site working like new and your
clients, prospects and other visitors will come away with the best possible
impression of your site and, hence, your company.
Steven Vicinanza, Ph.D., is CEO of BlueWave Computing LLC.
For more information, visit www.bluewave-computing.com.
For almost 20 years, Smart has been leading the way to a future where cars use less fuel, produce fewer emissions and leave a reduced environmental footprint.
Now, Smart can take taken the concept of the clean-running motor vehicle, and raise it to a new level for your business fleet. The Smart Fortwo packages everything you and your business will want in a fleet car – a distinctive look, advanced safety features, an environmentally-conscious design and materials, low maintenance, repair and insurance costs, and an easily-modified exterior that can be outfitted with the design, logo and graphics of your business.
The Smart Fortwo is a smart choice for any business looking to stand out from the crowd in the Atlanta area. Here are some of the many reasons why you should get Smart about your company’s car fleet.
Customize your car
With the Smart Fortwo, your business can have the best of both worlds – an environmentally-responsible car that still retains the eye-catching, distinctive look that the public has come to associate with vehicles by Smart. With your business logo and graphics on a Smart car, you create advertising and marketing opportunities wherever your car, or car fleet, goes. Smart cars provide reliable, low cost transportation that will ensure your employees get to where they need to go, providing your company’s services in visually-striking vehicles that will draw the attention of both current and future customers.
Smart offers multiple options for customizing your vehicle, including easy-to-install body panels in a wide range of colors, and Smart’s National Wrap Program, which allows you to design custom decals and full vehicle wraps for your Smart Fortwo. Smart company representatives will work with you to create a fully personalized design, including your logo, contact information and other graphic elements that can give your Smart vehicles your own unique look.
The production and installation is included in the overall price of the vehicle, eliminating additional out-of-pocket costs.
A safe ride
The designers of the Smart Fortwo put as much thought into safety as they did into the car’s aesthetics and environmental footprint. With engineering help from Mercedes-Benz, Smart designed a car that the people in your business can feel safe while driving.
The Smart Fortwo is constructed around a tridion safety cell, which is a reinforced, high strength steel safety cage. Inside the safety cage, the driver and passenger are protected by front and side air bags. In addition, the car features a collapsible steering column and seat belt force limiters, helping to reduce the incidence of injury not just from an impact, but from the safety equipment itself.
The braking system features Electronic Stability Program, ABS brakes, cornering brake control, brake assist and acceleration skid control, all of which helps allow the driver to maintain control of the vehicle in all types of weather and road conditions.
The thought and engineering put into the Smart Fortwo’s safety systems has earned it some of the best safety scores in its class. The Smart Fortwo has been given the highest ratings for frontal offset, side impact and roof strength tests by the Insurance Institute for Highway Safety. The Smart Fortwo also meets or exceeded all 2008 National Highway Traffic Safety Administration standards, including three out of five stars for driver-side impact and four out of five stars for driver-side frontal crashes.
A smart buy
The Smart Fortwo is designed to be an investment in your business. With zero emissions, high safety standards and unique aesthetic appeal comes low prices and low maintenance costs.
Models start at $11,990, with volume discounts available for fleet purchases. Once you get your fleet on the road, the Smart Fortwo provides optimal fuel efficiency the best fuel efficiency of any non-hybrid gas-powered vehicle in the U.S. – an EPA-estimated 33 miles per gallon in the city and 41 miles per gallon on the highway.
The Fortwo is designed to be easily maintained and repaired, featuring replaceable body panels and low-cost parts, in addition to extended service intervals. All of which means that minor repairs stay minor, regular maintenance is a little less regular, and your Smart vehicles stay on the road for your business, getting the job done.
And that’s not even broaching the subject of insurance – a sticky subject with a lot of businesses in the current economy. Thanks to the ease of repairing and maintaining a Smart Fortwo, it remains one of the least expensive vehicles to insure.
On average, it costs $487 per year to maintain a Smart Fortwo. That’s over $100 less than a Honda Fit, $200 less than a Mini Cooper or Toyota Prius and over $300 less than a Toyota Yaris, according to Intellichoice.com’s 2009 ratings.
Green to the end
When you buy a Smart Fortwo fleet for your business, you know you’re purchasing a vehicle that will, over the course of its product life, make a greatly reduced impact on the environment when compared to other vehicles on the market. But it will also continue as a green machine at the end of its usable life.
To the designers at Smart, making an ecologically responsible car doesn’t stop at eliminating emissions. It means building a car out of materials that won’t sit in a landfill for centuries after the car has traveled its last mile.
The Smart Fortwo’s modular design makes its components easier and more efficient to disassemble and recycle. The components themselves are constructed from materials that were selected for their minimal environmental impact and high level of recyclability. In total, 95 percent of the Smart Fortwo’s parts are recyclable. Several of the car’s parts, including the inner fenders and underbody trays, are made from renewable raw materials and 100 percent recycled plastic.
The Smart Fortwo is the latest generation in a growing Smart legacy that dates to the early 1990s – a legacy started with a vision to create safe, environmentally-responsible transportation designed for urban residents. Over time, that market has grown to include businesses looking for a distinctive vehicle fleet.
From the initial rollout of the Smart Fortwo in 2003 to the fully-electric Smart Fortwo Electric Drive in 2010, the Smart brand keeps growing and spreading around the globe. The car now retails in 41 countries.
Smart will continue to evolve and find new ways to enhance the safety, performance and environmental responsibility of its products, and hopes that you – and your business – will come along for the ride.
This advertising feature is brought to you by smart center Buckhead. For more information, visit www.smartcenterbuckhead.com
Banks and mortgage services have been under scrutiny lately with questions about whether they have fully complied with legal requirements in seeking to foreclose on property securing mortgage loans.
“With the downturn in the market, there was a massive surge in foreclosures,” says William A. “Mac” McBride, a litigation attorney at Baker, Donelson, Bearman, Caldwell & Berkowitz, PC. “The systems at banks and mortgage servicers were not designed to deal with the tsunami that hit them. They had systems in place designed to deal with X number of foreclosures and were suddenly dealing with X to the 100th power.”
Smart Business spoke with McBride about how the industry fell apart and the steps it is taking to put itself back together.
How did the problem regarding affidavits in mortgage foreclosures come to light?
It came to light this summer when an employee for a lender/servicer stated in a deposition that he had not taken all the steps necessary to verify the information in affidavits he was signing. Out of that came the term ‘robo-signing,’ which refers to the situation where a large number of documents are allegedly placed on an employee’s desk and he signs them without fully investigating their accuracy.
The problem is that when one signs an affidavit, the signer, or affiant, is stating under oath that he or she has personal knowledge or has made sufficient investigation to swear and affirm that the information in the affidavit is accurate, that the borrower is, indeed, in default on the underlying loan and the parties pursuing foreclosure own the note or otherwise have the right to pursue the foreclosure.
What was the result of the disclosure of ‘robo-signing’?
Virtually all banks undertook reviews of their internal systems. A number of banks instituted temporary moratoriums on foreclosures, halting them while they reviewed their systems, while others looked at their systems and determined a moratorium was not necessary. In addition, in an increasing number of foreclosure proceedings, borrowers are contesting the foreclosure by challenging the associated affidavit.
Although you are seeing a lot of these cases among plaintiffs, in the overwhelming majority of these cases the affidavits are factually accurate and reflect the state of affairs at the time they were signed. The borrowers are in default and, generally, by the time they get to foreclosure, they are as many as 12 to 18 months in arrears, and it’s safe to say the foreclosure is going to happen once the paperwork is sorted out.
The problem is not that homes are being taken from innocent people because other people are making things up. The problem is that if you are signing an affidavit, you are testifying you have personal information or have made sufficient investigation to confirm that what you are signing is accurate, when, in some cases, the signers were simply relying on their underlings to do their jobs properly without verifying it. That is not a trivial thing; filing documents under oath with a court is serious business. But to the extent inaccurate affidavits were filed, the inaccuracies related to the knowledge of the affiant rather than to the default status of the borrower.
What has been the negative impact on banks?
The sole realistic collateral for mortgage loans is the underlying property, because, by the time of foreclosure, borrowers rarely have other significant assets. A bank can’t sue and realize a money judgment; the assets aren’t there. The house backs up the loan, and if there is a significant delay in the bank’s ability to foreclose on the property and liquidate it, that slows down the process. Not only could that temporarily impair capital while banks try to foreclose and liquidate, it could also affect future lending decisions. Every time you throw an obstacle in the way for a lender to be able to realize on collateral, that calculates into its decision to make loans. In theory, you could see banks further raising their lending standards because this is one more potential obstacle. The biggest impact though is likely to be on the housing market and economy generally. Anything that delays foreclosure delays the ability of the market to clear and prolongs the housing crisis, which has already lasted for three years.
What other institutions are being impacted?
An increase in challenges to foreclosure also burdens the judicial system, which was designed for a very different economic reality. Banks have more flexibility to adjust in that they can hire people or acquire new technology. But the court system, being dependent upon the political process, isn’t as nimble. For the system to suddenly change from a model where it might have 5,000 foreclosures a month to where it now has 100,000 hugely stresses a court system that already has a very large backup.
How does this issue impact third-party purchasers of foreclosed property?
It creates uncertainty. For example, say the bank foreclosed on Joe and Mary Smith a year ago, and the property was sold to Susan Jones. But the affidavit submitted in connection with the foreclosure wasn’t properly verified, so the chain of title is being challenged. If the original borrower complains that the foreclosure was wrongful because the affidavit was fraudulent, suddenly you have a third-party title issue.
That presents potential concerns for those who buy property out of foreclosure, as well as for title insurance companies that verify the title is good. If that adversely impacts the willingness of purchasers to buy property out of foreclosure, it’s another factor that may slow the clearing of the market and prolong the housing crisis. That inability to sell will further damage banks and lenders by impairing their ability to realize capital on that collateral as a result of either being unable to sell or having to sell at a significant discount that reflects that there’s a title uncertainty.
William A. “Mac” McBride is an attorney at Baker, Donelson, Bearman, Caldwell & Berkowitz, PC. Reach him at (404) 221-6537 or email@example.com.
“In the beginning, you may overshoot and you may undershoot, but the more time and focus you can spend on it, you can then help drive the plan,” he says.
Despite his best predictions, Krubert reached a point where he was underpredicting, and in that six-month to a year time period, his job simply wasn’t fun like it had been.
“I was personally pulled too far,” he says. “Luckily, I go back to my training as an ER doctor, and many times in the ER, you’re pushed to the edge, and you can’t quit because someone will die or not die. That helped me in saying, ‘OK, focus on what you need to do here. Let’s simplify what’s going on and let’s have a plan,’ and then there was a light at the end of the tunnel.”
He became quite disciplined in his daily approach to the job — coming in each day, first making sure that clients were tended to, then ensuring his team was taken care of, and then spending the rest of his time doing the work that would help him out in a year.
“A lot of times managers will focus on what I have to get done today, and they don’t give themselves the two or three hours a day to spend on, ‘What am I going to do a year from now?’” he says. “It catches up if you don’t do it, and that’s where the discipline and proactive planning comes into place.”
This approach helped him stay ahead of the company’s revenue growth — which went from $90.2 million in 2006 to $261.6 million in 2009. After that kind of growth, the company is now able to better predict future growth.
“Now, luckily, we have four or five years of growth, and we know that if we’re calling X amount of clients, here’s usually what our close rate is, so we can get better at predicting,” he says.
Some of the keys that have helped Krubert successfully grow ApolloMD without falling on his face have been to promote the right people, build rapport with his clients and to put processes in place to ensure the organization’s service didn’t lag.
“If you don’t continue to service, the growth will stop,” he says. “It’s trying to keep the growth engine in line with the operational support, and that’s taken a lot of interviewing and meeting good people and hiring the right people and training them up and putting in processes and using IT support to support the growth that we’ve had.”
Promote the right people
It’s such a critical mistake, and Krubert admits he’s done it himself — hiring or promoting someone whom you really like but doesn’t have the skills to do the job.
“I’ve done it, and often, you’re very disappointed and so is the person that’s doing the job, and sometimes the likability goes away,” he says. “It’s less about who we like and more about who can do it.”
But you have to really know what you’re looking for in a position.
“It’s a disciplined approach to define the key characteristics of what you need in a person to do that specific job and completely severing the, ‘I like, I don’t like,’ and then tapping into other people’s sort of ratings on the same scale,” he says. “It’s pretty clear, hard work or not hard work. That’s almost a quantifiable type. There are ways you can define that and then ask other people who are in a similar role.”
Krubert uses a few key characteristics in determining if someone is suited for a position, and that includes the person’s work ethic, how he or she handles stress, his or her ability to provide good service and the ability to create relationships. To evaluate these characteristics, it’s not just a couple of interviews. Instead, new employees go through a two-year leadership academy in which they’re exposed to some of the best hospitals that ApolloMD operates, mentoring and apprenticeship programs, the Apollo way of doing things, and formal educational materials.
“In the end, those people have been exposed to almost all the problems,” he says. … “They’ve lived the experiences without having to worry about the mistakes.”
At the end of that training, when a new opportunity arises, Krubert is able to look at his top candidates based on the characteristics that he’s seen in their training to decide who gets a shot at running the show when the company signs on a new place.
“You get the good exposure,” he says. “You see them in multiple venues. You see them in a professional setting, and you see them in the clinical setting. One thing about working in the ER, you see them at their worst and best.”
He’s able to see employees when they’re tired, stressed and facing technical challenges. He also gets to see their personal side and how they work with patients and how they treat them and how responsive they are.
“It’s almost a little microcosm of a platform to say there’s a lot of transferable characteristics that would apply from working in an ER or a clinical setting that we could then say, ‘This person could probably apply those same skills to the management side,’” Krubert says.
Build client relationships
One of the biggest keys to ApolloMD’s growth is excellent service, and that relies on building relationships with clients.
“That doesn’t mean wasting their time with lunches every month,” Krubert says. “It might just mean when you’re there, using the valuable time to ask the right questions. Don’t spend all your time selling, because most of the time, they have you there because they already bought you.”
He says you should strive to understand their organization and help them to see how you’re able to bring value to them.
“First, what’s their vision for either their company or service line?” he says. “How will what we do specifically apply to that?”
For example, if the client’s goal is to grow its revenue base by 20 percent, how does the ER fit into those plans? What are the exact expectations that the client is building into its budget?
“You can’t ask those questions unless you have a personal relationship and there’s trust and credibility,” he says. “You have to know their language. … Then it’s understanding, ‘OK, ER, you budgeted in 20 percent growth in the ER. Here’s our plan to get you there, and does that seem in line with what they’re specifically trying to do?”
The key is to make sure you’re asking good questions so you can have the most and best knowledge.
“Ask probing, delicate questions to make sure that their vision is consistent with what our plan is and then update it periodically,” Krubert says.
It’s also important to make sure you understand the individual you’re talking to and get to know them as a person as well.
“There’s many times they may have their own personal challenges,” he says. “Their job may be on the line if they don’t hit certain metrics. If you can understand what their personal goals are, whether it’s job preservation or maybe specifically growing it so they can get their bonus.”
Krubert takes it a step further and aligns his people’s goals with those of his clients so that everyone has the exact same metrics.
“Now, when they all win, they’re all happy, and if they don’t win, they’re all going to cry together,” he says.
It eliminates politics or hidden agendas from one party or the other when everyone is striving for the same thing, and they’ve seen a true performance bump by taking this route.
Then the last element of building strong client relationships has been to be open and honest about expectations.
“It’s very easy to sell one thing and not deliver,” Krubert says. “Reputation is what drives us and growth, so make sure what you sell and what you promise can be done. Before you promise something, you may want to do your research if it’s a technical or very specific number. It’s important to ensure what you promise you can actually deliver on.”
It’s important to also discuss the risks with your clients so they’re clear about not only what could go well but also the chances that something could not happen as planned.
“Giving them specific data and having them trust that you say you’re going to do it, you deliver, that builds trust because the next time you come in and ask for it or they ask for something, there’s that trust element,” he says. “In our business, personal relationships are huge and your reputation is important.”
Put processes in place
When you’re seeing 2.5 million patients a year like ApolloMD’s staff does, 2 to 5 percent inefficiency can create a lot of problems, so Krubert has had to put processes in place to keep up with the growth and eliminate inefficiencies that could affect their service.
One of the biggest processes he’s implemented is with the physician credentialing procedure. When a physician works at a hospital, he or she has to go through the appropriate paperwork to get an ID number from Medicare in order to get paid for the work. If that doctor works at multiple hospitals, he or she has to have a number for each location. If the company picks up a new hospital, it then has to credential all of those physicians. The paperwork is long, tedious, has a lot of room for error, and once submitted, it could take months to get the approval. There are a lot of moving parts with it, and many companies have gone under because of not keeping up with it and being able to collect the money that’s owed them.
At one point, only 80 percent of ApolloMD’s credentialing was up to date, so 20 percent of the time, it was lagging, which had a huge financial impact. Krubert identified this one process as the most critical to the company’s overall success.
“Invest in data and metrics, not just metrics that your clients use but metrics internally, trying to make them simple but sort of poignant,” he says. “You have got to understand what is the key component that determines success.”
He says that this should be something that you measure or have a way to measure.
“You have to come up with ways to measure it, whether it’s technology or simplifying your process, but then monitoring it and benchmarking it and having historical data, so you can do a trend analysis and, when you’re pointing toward the worst direction, you can act,” he says.
“What I’ve seen is that companies, as they get bigger, it gets so complicated you don’t even know where to start in the day, so if you can simplify your business with a handful of measurable metrics, and then, more importantly, communicate that to your team and then align the incentives of your team with those metrics, those are the key elements that define success in whatever department.”
Krubert spent a lot of time studying lean and Six Sigma methodologies to implement processes to speed up this procedure.
“It takes senior management to really understand and know your business, to know all key elements of the processes that go in,” Krubert says. “If you don’t know it, either learn it or tap in to the expert person in your department and have them work closely with making it. Oftentimes, people who aren’t experts at all will come up with way too many things to measure in terms of key success or make it way too complicated rather than this is the one sort of statistically objective measure that will be directly aligned with the overall success of the organization. … It all has to be connected to the goal of the company.”
After putting processes in place to improve this one procedure, the company is up to between 98 and 99 percent successful credentialing, which means when a doctor sees a patient, the bill goes out that day instead of in three or six months.
“When we’re efficient and we’re low-cost internally, our administrative overhead expense is low, and we can pass that through to our client, which is a big deal in health care today,” Krubert says. “You can’t just be good and nice; you have to be low cost.”
How to reach: ApolloMD, (770) 874-5400 or www.apollomd.com
Employee compensation has been a hot topic during the recession. Many employees have taken on additional responsibilities due to downsizing within the company but may not have received additional compensation for these new duties. Some of these employees may have even taken a pay cut just to keep their jobs.
You may run into problems retaining these employees after the recession ends if you don’t properly compensate them or negotiate a fair salary. Offering pay increases or bonuses may not be an option at this time, so you need to develop nonmonetary compensation options, continue to maintain a positive work environment and address any concerns upfront with employees.
“Ignoring salary negotiations only exacerbates an already bad situation,” says Jessica Ford, director of sales and operations with Ashton Staffing. “Employees may feel discontent about their salary and simply not discussing the issue may make them feel that they are not important and their worth is solely based on salary. Try to involve employees when possible and let them understand the company’s current financial situation.”
Smart Business spoke with Ford about key things to include in salary and compensation negotiations and how to develop nonmonetary compensation packages.
What are some key things you should understand about salary negotiations and employee compensation?
Negotiation is not about winning, unless both parties win. If either party feels they have not negotiated, both parties lose. Make every effort to identify the most recent salary and benefits your employee or potential candidate received. Ask an employee candidate to provide a W2 or proof of salary during negotiations instead of simply asking about his or her desired salary. You can also find this out from former employers when conducting reference checks. You may not be able to match the salary, but you will have a good idea of what the candidate will seek during negotiations.
Arm yourself and do your research. Be sure to reference your current internal salary ranges, the salary of current employees in similar positions, the profitability of your company, as well as the job search market in your area and the economic climate.
Even if an employee has positively impacted your company, you need to keep your salary limits in mind. You will save yourself years of headaches and prohibitive costs by doing this, even if you have to start your recruitment process over or tell an employee that salary negotiation is not an option at this time.
What are some common mistakes employers make regarding employee compensation, and how can they mitigate those mistakes?
Some employers have simply blamed the maintenance or reduction in employee compensation on the recession and have not come up with alternative ways to reward employees. Reducing employee discontent due to employee compensation is dependent on the total work environment you offer employees. Think outside of the box. Sometimes the biggest mistake employers make is to think that employees only care about a monetary salary. Offer other incentives that shift the focus away from monetary awards to employee recognition. This can lead to higher productivity.
How can you develop nonmonetary compensation packages for employees?
- Offer a balance between work and life. Allow flexible starting times, core business hours, work from home options and flexible ending times. Employees will deter from a fixation on salary if they feel like they have a balance and some freedom.
- Offer an attractive and competitive benefits package, if you are able to, with components such as life and disability insurance and flexible hours. An employee can be content with a low- to midrange salary if a strong benefits package is offered.
- Select the right people from the beginning through behavior-based testing and competency screenings. Offer performance feedback and praise good efforts and results.
- Do your best to create a fun work environment, because people want to enjoy their work. Engage and employ the special talents of each individual, and involve employees in decisions that affect their jobs and the overall direction of the company, such as the discussion of company vision, mission, values and goals.
- Continue company traditions, such as holiday parties. This gives everyone something to look forward to and adds an element of fun into the workplace.
- Remember to take an interest in your employees. Respect their ideas and listen to them. This small gesture can make an employee feel needed and that he or she has a purpose in everyday tasks, beyond just receiving a paycheck.
- Provide opportunities within the company for cross-training and career progression. People like to know that they have room for career movement.
How can you handle employees who are not happy with their salary and the negotiation process?
Remember to always be honest with your employees and never promise them anything that you cannot offer. Tell your employees upfront if it’s absolutely impossible for your organization to address salaries at this time. Be sure to balance this with some kind of nonmonetary reward. This is necessary in order to maintain a healthy and happy work environment. But if you are confident that your company will have a good year, set a date as to when your employees can expect a raise or bonus.
Jessica Ford is the director of sales and operations at Ashton Staffing. Reach her at (770) 419-1775 or firstname.lastname@example.org.
Smart Business spoke to John M. Leonard, the first vice president
and regional manager of the Atlanta office of Marcus & Millichap Real Estate
Investment Services, about where opportunities lie in the distressed real
How high is the level of
distress in the Atlanta commercial real estate market right now and what does
it mean to investors?
Weak economic conditions
through the recession took a toll on commercial real estate fundamentals in the
Atlanta metro area, leading to a significant amount of distress. Approximately
$5.1 billion of real estate in Atlanta can be classified as distressed, placing
it near the center of the pack when scaled to the market’s size and compared to
other major metros nationwide. The distressed dollar volume total includes
approximately $3.4 billion in troubled properties and another $1.7 billion in
assets already reclaimed by banks. The figure does not include, however, the
roughly $650 billion in commercial mortgages that has been restructured or
extended, or the $1.3 billion in distressed commercial real estate deals that
have already been resolved.
Which sector of the
investment real estate market has been impacted most by these delinquencies?
As of third quarter,
apartments account for the largest share of distressed dollar volume in the
Atlanta metro area, which should translate into some strong acquisition
opportunities for investors as fundamentals recover. Interest in stabilized
lender-owned properties remains particularly high, and several sales involving
this type of asset have already occurred. Prices for these deals generally
start below replacement costs at less than $40,000 per unit, with cap rates
varying from 8.5 percent to 9.0 percent. Assets with deferred maintenance or
high vacancy also continue to attract interest due to opportunities to
strengthen performance in the quarters ahead, but cap rates typically will
begin above 9 percent. While the expected improvement in occupancy and rents
will bolster NOIs, new supply will slow through the remainder of this year and
into 2011. The slowdown in construction will provide greater opportunity for
new owners to rebuild property operations.
How have delinquencies
impacted the retail real estate sector?
While investor demand remains
greatest for stabilized retail properties occupied by strong tenants with good
credit, the market for distressed deals has become more active. More lenders
have begun to list distressed shopping center properties in the Atlanta metro
area, a trend likely to persist over the remainder of this year. So far, even
vacant retail assets have attracted interest from local buyers, although prices
must be approximately $40 per square foot for deals to occur. Distressed sales
will likely continue to appeal mostly to local private investors, as the
majority of the retail properties classified as REO as of the third quarter are
relatively small, with an average size of approximately 33,000 square feet.
How is the office market
performing and how much duress is that sector under?
Office property operations
have continued to soften this year due to the completion of substantially
vacant properties in the urban core and continuing business closures and tenant
downsizings. Properties scheduled for delivery this year broke ground during
better economic times but will expand office stock by a significant 1.9 percent
at a time when demand remains slack and vacancy already exceeds 20 percent.
While gradual strengthening in the local economy will lead to the creation of
approximately 7,700 office-using jobs by year-end, many of these positions will
fill underutilized space before tenants contemplate enlarging their footprints.
Efforts by property owners to
fill vacancies as demand improves and leases roll over will sustain the
downward trend for rents, placing additional pressure on NOIs and contributing
to more distress in the local market. Although fundamentals will remain weak
for several more quarters, prices have likely neared the bottom. As a result,
investors seeking discounted value-add opportunities ahead of a robust recovery
likely will step up activity in the months ahead. REO activity is also on the
rise, and banks will dispose of more reclaimed assets as their balance sheets
improve. These lender-owned assets, which may be priced at deep discounts, will
present opportunities for aggressive investors to enhance value through the
employment of re-tenanting strategies, including steep rent cuts.
John M. Leonard is a first
vice president and regional manager of the Atlanta office of Marcus & Millichap Real Estate
Investment Services. Contact him at email@example.com
or (678) 808-2700.
Companies lose $350 billion a year and for reasons that can’t be blamed on the economy. These companies are losing money because of employee disengagement.
Employee engagement is a measurable degree of an employee’s positive or negative emotional attachment to their job, colleagues and organization, which profoundly influences their willingness to learn and perform at work. Thus, engagement is distinctively different from satisfaction, motivation, culture, climate and opinion. An engaged employee will act in a way that furthers his or her organization’s interests.
“How many of the employees in your company are really engaged? If you believe that about half are, you may actually be surprised,” says M.J. Helms, director of operations for The Ashton Group. “According to a recent Gallup study on employee engagement, about 54 percent of employees in the United States are not engaged and 17 percent are disengaged. Only 29 percent are engaged.”
Smart Business spoke with Helms about what your company can do to have a satisfied, productive and enthusiastic staff.
Why is employee engagement so important?
When employees becomes disengaged, your turnover rate increases, which impacts productivity and the bottom line. You need to discuss strategies and tactics that build a corporate culture where employees want to be part of the team. Start with an employee survey; feedback from all aspects of the employee lifecycle can be used as the foundation for change and ongoing success.
What should be asked in an employee survey?
Some suggested questions to ask in your employee survey are:
- Do you know what is expected of you?
- Do you have the materials, equipment and information you need to do your job right?
- Have you recently received recognition for doing a good job?
- Does your employer seem to care about you as a person?
- Does your manager encourage your development at work?
- Do you feel your opinions or ideas seem to count at work?
- Do you feel that your co-workers have the same dedication to their jobs as you?
- Do you have a best friend at work?
- When was the last time your manager talked to you about your progress?
- Have you had any opportunities at work to learn and grow in the past year?
Why does appreciation change everything?
Recent research has shown that appreciation is the driver behind great work. There is no greater tool for teaching, reinforcing and aligning company goals and values than employee recognition. Appreciation will help your company by ensuring that employees are receiving the appropriate training to support their ongoing development. It also links employee skills with opportunities for growth in the company, helps employees understand how their work contributes to the company’s bottom line, and gives employees ongoing feedback on their performance.
What is the ‘C series’ when it comes to employee engagement?
The ‘C series’ is 10 guidelines that should be incorporated into an employee engagement plan. They are:
- Career: Companies should provide challenging and meaningful work with opportunities for career advancement.
- Clarity: Managers need to communicate a clear vision. Success in life and business is, to a great extent, determined by how clear individuals are about their goals and what they really want to achieve.
- Communicate: Strong leaders clarify their expectations about employees and provide feedback on their job performance.
- Congratulate: Exceptional managers give recognition, which is sure to keep employees motivated.
- Contribute: People want to know that their input matters and that they contribute to the company’s success in a meaningful way.
- Control: Employees value control over the flow and pace of their jobs and managers can create opportunities for employees to exercise this control.
- Collaborate: When employees have the trust and cooperation of their team members, they outperform both individuals and teams that lack good relationships.
- Credibility: Upper management should strive to maintain a company’s reputation and demonstrate high ethical standards.
- Confidence: Good leaders help create confidence in a company by being examples of high ethical and performance standards.
- Connect: Your company must show that it values employees.
What else can an employer do to increase employee engagement?
No matter what the economy is like, employee engagement is imperative for businesses to survive and thrive. Here are five other ways to increase employee engagement:
- Reduce excessive workplace stress. If employees are stressed-out, which seems to increasingly be the case in today’s work force, they cannot be engaged.
- Address the situation by talking about it. Let employees know that you are aware there is stress in the workplace.
- Extend a helping hand. Let your employees know that you will work with them so they can keep a healthy balance between work and home lives.
- Think about innovative ways to reduce stressful situations. You may consider providing alternative and flexible scheduling.
- Think about hiring additional staff. Oftentimes, hiring an additional temporary employee seems like an expensive solution to employers. However, employers can end up spending a lot of time and money should an employee begin to have additional stress and become chronically absent or require medical leave. These situations can cause high turnover rates, so it is usually better to consider hiring temporary personnel.
M.J. Helms is the director of operations with The Ashton Group. Reach her at (706) 636-3343 or firstname.lastname@example.org.
Born: Knoxville, Tenn.
Education: Electrical engineering degrees from the University of Tennessee and Georgia Tech
As a child, what did you want to be when you grew up?
I wanted to be a ballplayer. I’m 3 inches too short and 50 pounds too light.
What was your first job as a kid, and what did you learn that still applies?
Carrying newspapers. I started very young I was 9 years old. [I learned] the importance of collections, the importance of getting paid.
What’s the best advice you’ve ever received?
It comes back to the best advice is to focus and be good at something.
What’s your favorite movie and why?
‘Remember the Titans.’ I love team-based sports and those kinds of feel-good movies.
If you could have dinner with any three people from history, who would it be and why?
Mother Teresa, I would love to get to know her. There’s an example of someone extremely passionate and committed and focused on being the best at what she did and caring for others.
Another person that would be very intriguing would be one of the founding fathers of the country pick any one of them John Hancock understanding the building of a nation and the enormity of building a nation. I’d love to know if they really understood the enormity of what they were doing back then. It could be really interesting.
Harry Truman is a president that I’ve read a fair amount about, and I’m intrigued by his approach to solving problems and his ability to pull together a group of people and a team.
Aventis Systems, Inc., located in Marietta, Georgia, is one of the fastest growing companies in the refurbished server business. Founded in January of 2008, Aventis Systems grossed 2.8 million dollars in revenue its first year in business and this year they are expected to hit just over 10 million. So what’s the secret to success for a small business like Aventis Systems?
Tiffany Bloomer, Director of Business Development, shares with us some of the strategies Aventis Systems developed at the beginning that set the company up for success in the refurbished hardware industry.
For more information on Aventis Systems, visit www.aventissystems.com or call 1-866-528-9313.
Tiffany Bloomer is the Director of Business Development for Aventis Systems, Inc. Reach her at email@example.com.
Tracy Lovitz is the Marketing Manager for Aventis Systems, Inc. Reach her at firstname.lastname@example.org.