In traditional companies, management passes from one individual to the next based on professional qualifications. In family-run businesses, however, leadership positions often pass to close relatives irrespective of qualifications for the job.
In many ways, family businesses are better than traditional companies. The employees have been there through thick and thin, and there is a strong sense of pride throughout the organization. Still, over time, even the strongest organizations can falter if the leadership isn’t up to par. Mismanagement is the source of most business failures, and by the time the company realizes it needs outside help, it’s often too late.
Take, for example, a company that my private equity firm acquired in 2009. We made the mistake of leaving the management team — established by the second generation of family leadership — in place until 2010. When we decided to overhaul the company, there were several key steps.
Address staff issues. In mid-2010, faced with mounting operating deficits, I stepped in and assumed the CEO position. I eliminated redundant and ineffective staff members and streamlined reporting responsibilities, eliminating entire layers of management. Not only did this result in immediate cost savings, but it also enhanced staff performance and created accountability. Do not be afraid to let people go if they are not helping the business succeed.
The company is your first priority.
Get new perspectives. If management needs to be replaced, be wary about hiring existing staff members to fill those vacancies. Poor or insecure leaders tend to surround themselves with advisers whose critical thinking skills are weak. When incumbent management indicates that the status quo must remain, more often than not, this is indicative of management lacking in expertise and vision. A third-party expert might be needed.
Don’t overhire. Hiring several people at once is a classic leadership mistake. It’s easy to assume that one new hire will generate a certain amount of growth, which will, in turn, create a need for additional employees. Avoid this pitfall. Hiring before you have actual need or before free cash flow supports hiring a bigger staff is the first step on the path to failure. My rule of thumb is to wait until the existing staff has a heavy enough workload to necessitate three new employees, and then hire one.
Keep the peace. While trying to revamp any family-owned company, you will inevitably face challenges from people who have been there for years and who expect things to be done a certain way. Change is unavoidable, but you can gain your employees’ trust by retaining the best qualities of the business as you restructure. Don’t fix what isn’t broken. Your staff will recognize that you have the company’s best interests in mind and will trust your judgment as you implement changes.
Know your customers. Understand the choice your customers are making between you and your competitors. For example, at the company acquired by my private equity firm, I knew our products were outstanding, but our marketing strategy was ineffective and customers weren’t fully aware of our product range. Overhauling the marketing strategy has helped us expand our market share. This is a continuously evolving process. To perform better, you must exceed customer expectations on every visit. It is critical to understand your customers and the market so well that you anticipate customer needs before they know what they want. In restructuring the business, the rule of thumb should be, “Keep the best, overhaul the rest.”
Guest columnist Bruce Rosenthal is the president and CEO of Submarina California Subs. For more information about Submarina or franchising opportunities, please visit www.submarina.com.
The odds were against Z Brand Group when it was first formed. Born into
a downturned economy, the company also faced the challenge of having 70 percent of its client base composed of nonprofit organizations — the sector hit the hardest by the recession. But despite these challenges, Goldie Z. Ostrow was able to get the company off the ground and see it quickly thrive.
Leaving the design and marketing communications company she had previously co-founded, Ostrow decided to establish Z Brand as a new kind of agency that would deliver a high level of quality services, including advertising campaigns, across a variety of platforms, as well as offer social media to her clients for the first time — all at a more streamlined cost. As president and director of business development, she grew her business by networking and mixing tactics such as giveaways, a billboard campaign, social media and a website.
Z Brand has grown a loyal client base by delivering exceptional return on investment for its clients. Ostrow strives to keep costs low through a variety of smart business practices, such as eliminating excess, smart shopping for the best vendor quote, subleasing agency space and taking advantage of advertising specials and deals for both Z Brand and its clients.
With clientele including many of Pittsburgh’s largest companies, Z Brand also does extensive pro bono work with several high-profile nonprofit organizations.
Ostrow is as active within the community as she is with her business. She serves on the Friends of CAPA Advisory Board and recently joined the boards of Family Resources, Rodef Shalom Congregation and Hillel Jewish University Center. Additionally, she chaired Rodef Shalom’s public relations committee and served on the United Way of Allegheney County’s strategic marketing committee.
How to reach: Z Brand Group, (412) 697-2800 or www.zbrandcreative.com
As a former NFL player with the San Diego Chargers and the Pittsburgh Steelers,
Charles Sanders has always been a very involved philanthropist within the Pittsburgh community. The running back turned businessman understands the importance of helping those in need and has played an active role in bettering the lives of others.
His contribution does not stop at supporting charities and local programs, however. One of his largest contributions came in 2002 when he and his wife, Elisa, founded one of the most highly rated, privately held vendor management companies in the country, Urban Settlement Services. The company later changed its name to Urban Lending Solutions and has been on a steep growth curve for the past few years.
Nearly 10 years after its founding, the company continues to grow, adapt and garner accolades for the problem-solving work it has done for lenders and servicers. A certified Minority Business Enterprise, the company has been named a National Minority Supplier Development Council Supplier of the Year, listed as a 2009 and 2010 Black Enterprise 100 in services firms and a 2009 Top Five Fastest Growing Firms in Western Pennsylvania by the “Pittsburgh Business Times.”
Sanders, the company’s CEO, has built the company on excellence, dedication and teamwork and got its reputation for providing title services and loan origination work for people buying homes. With the onslaught of the mortgage crisis, Sanders saw an opportunity to grow and help more people, so he decided to shift his focus. The company looked to provide comprehensive products and services to support the residential and commercial mortgage and real estate industries delivering some of the fastest turn times in the industry.
While Sanders has taken hard hits on the football field, he didn’t like seeing people in his community suffering from the hard-hitting effects of the mortgage crisis. Sanders grew the company’s services in recognition of and in reaction to the mortgage crisis. He saw that he was in a perfect position to help those in need when the housing market fell in 2008 and partnered with financial institutions to provide homeowners with options to save their homes.
Those options include solutions for residential, servicing and commercial. Urban Lending Solutions is experienced with both prime and subprime transactions, as well as loan requirements. It offers full title insurance across the country, as well as appraisal and alternative valuations, settlement and closing services. The business provides a full complement of loan origination services.
Today, Urban Lending Solutions is a leading provider of home retention services, focused on saving people’s homes. Urban provides creative solutions regarding loan modifications, loan workouts, call campaigns, borrower engagement and other loss mitigation activities. Additionally, Urban Lending Solutions offers contract underwriting, market-to-market diligence, predictive data analytics, a Web services platform and other servicing sector products.
Bringing the centralized vendor management concept to the commercial sector, Urban Lending Solutions commercial unit offers a full complement of services, including appraisals, title and settlement services, as well as construction audits, tax reduction services, cost control and risk cutting. The company can centralize all facets of commercial transactions so that clients can access all of the real estate and mortgage services they require from one source, saving time and creating cost-efficiencies.
The growth and success of the company over the last five years is a direct result of Sanders’ ability to recognize emerging areas people needed help in as well as the company’s solution management capabilities. His vision and delivery of services has provided a beacon of hope for families across the country. Through the organization’s home retention work, Urban Lending Solutions has become an industry leader and since 2007, the company has helped retain nearly one million homes.
Since 2006, Sanders’ leadership and direction have resulted in revenue growth from $10 million to more than $100 million. Through the company’s expertise in emerging markets and its ability to help meet and even exceed goals, the company is one of the largest providers of home retention services focused on saving people’s homes and removing debt. The company now has offices in North Carolina and Colorado, along with its headquarters in Pittsburgh, and today, it is the nation’s largest minority-owned settlement services company.
HOW TO REACH: Urban Lending Solutions, (412) 325-7046 or www.urban-ls.com
Under the leadership of President Mark T. Perry, Tetra Tech NUS Inc.,
a provider of consulting, engineering and technical services, has grown more than 40 percent in the past three years.
This growth has been spurred by Perry’s vision to transform NUS from a government contractor into a diverse company that offers full-service environmental engineering. Having been partners with the U.S. Navy for many years, Perry knew the importance of that relationship, but he saw other opportunities for NUS in the marketplace.
His vision began with pursuing work from the private sector, an area that NUS was unfamiliar with. He also saw that there were Pittsburgh markets that NUS could address to help the company become more sustainable. After identifying a few ways to diversify the company’s services and add new clients, he looked to support those endeavors with acquisitions and mergers.
Perry went to a sister organization of Tetra Tech that had strengths in areas NUS wanted to get involved in. It wasn’t long before the companies merged and NUS was looking to add another acquisition. This time NUS acquired a company called Quattro Engineering, a manufacturing engineering design company that had connections to local chemical and steel companies.
With new acquisitions, business and services, NUS needed to hire new employees to run its new departments in water and wastewater, energy and natural resources, and nuclear services. These new departments have allowed NUS to successfully bid for and implement larger-scale projects such as the Marcellus Shale Natural Gas exploration. Other opportunities have come from the commercial sector working with NASA, the U.S. Army and the U.S. Coast Guard.
While the company has seen strong growth and expansion nationally, Perry has fostered local growth and employment along with it. In the last two years, NUS has added 50 employees and plans to add another 30 this year.
Perry’s drive and vision to succeed has helped NUS increase revenue and positioned the company as a leader of engineering solutions to environmental problems. The company continues to see significant growth in revenue and employee count and has been opening new offices around the country. In fiscal year 2011, offices are planned to open in Alabama, Oklahoma, Pennsylvania and West Virginia.
HOW TO REACH: TetraTech NUS Inc., (412) 921-7090 or www.tetratech.com
Sean McDonald is no stranger to the Pittsburgh Pacesetter ranks, having been
recognized now for the third year in a row — and for good reason. As president and CEO of Precision Therapeutics Inc., a life-science technology company focused on cancer research and development, McDonald has led the company to impressive growth and advancements in the industry.
He believes Precision Therapeutics can become the next big life sciences success story, and over the past few years, every sign points to that statement becoming more and more of a true fact. From raising increasingly larger amounts of venture capital dollars each year to developing new products and hiring new employees, the company is firing on all cylinders.
The company has been able to triple its employee base in the last three years, adding more than 20 employees just in the last six months. Precision has also doubled its sales force over the past year. Additionally, a second clinical laboratory and a third research facility have been opened, as well. The additional work force and space will allow the company to expand its work to meet doctors’ and patients’ needs by being able to personalize the treatment that is best for the patient.
McDonald’s focus is to advance clinical trials and research in an effort to improve the quality of life for the patient. As the company continues to grow, McDonald leads his work force by challenging his employees and himself to develop creative solutions for the constantly changing business climate. The dynamic corporate culture at Precision encourages employees to educate themselves further by attending education, research and advocacy events. In order to accomplish this, he encourages input and accountability from his employees and maintains an open-door policy. The promotion of education allows employees to stay ahead of the fast-moving industry and encourages career advancement.
McDonald’s commitment to scientific advancements stretches beyond the company. He serves as chairman emeritus of the Pittsburgh Technology Council and sits on the board of the Pittsburgh Regional Health Initiative. He is chairman of the board for Aethon, a company backed by venture capitalists that is trying to develop autonomous robotics for the health care industry. McDonald also sits on the board of directors for Philips Respironics and several other technology companies.
McDonald has definitely made a positive impact within Precision, the Pittsburgh region and the industry. He’s shown his willingness and proven his ability to master a wide range of unfamiliar issues in the complex world of oncology, including clinical studies, technical laboratory processes, reimbursement and billing, and physician relationships.
McDonald constantly challenges himself to be a better leader. He has created a company that is dedicated to the ongoing clinical trials and research to better provide physicians and patients with actionable clinical information to personalize cancer treatment. He continues to drive the company into the development of genomic and proteomic profiles to predict tumor response to chemotherapy.
These trials and extensive research have led to the company’s flagship diagnostic test called ChemoFx, which helps to determine the most effective type of chemotherapy to treat individual patients’ tumors. It has also led to an exclusive partnership with Med BioGene Inc., a Vancouver-based life-sciences company that is helping to develop a lung cancer test called LungExpress Dx.
McDonald showed his unwavering commitment to the company once again by continuing to secure investors to raise venture capital dollars. Due to the company’s continued growth and advancements, Precision has received more interest from larger venture capital firms, and in 2010, he secured $33 million in new investment funds — Precision’s largest round of capital. That round of funding brought the company’s total venture capital intake past the $100 million mark.
McDonald doesn’t just recruit investment dollars, but he has also been instrumental in recruiting and retaining top-notch executives with proven track records to lead the management team and attract key opinion leaders in oncology to serve as speakers and advisers for the company.
Through McDonald’s commitment to continuing the strides that the company has made in cancer research, Precision has showed an annual growth rate of 25 percent and now has nearly 300 employees. He has defined Precision as one of the leaders in the personalized medicine arena and is expanding its unique capabilities to include several platforms to meet the needs of doctors and patients.
HOW TO REACH: Precision Therapeutics Inc., (800) 547-6165 or www.precisiontherapeutics.com
Patricia T. Horvath has been named executive director of UnitedHealthcare
Employer & Individual in Northern Ohio. She joined UnitedHealthcare in 2001 as managing director of health and wellness strategies for the Central and Western regions.
Sweeney founder James B. Sweeney was named as the agency’s first CEO. Jennifer A. Manocchio is now president. She most recently served as vice president and general manager of the company’s Wilmington, N.C. office.
Sweeney established the agency in 1986 and will focus on agency growth, business development, creative services and quality assurance. Manocchio will take responsibility for client services and agency operations, including personnel, technologies, vendor relations and partnerships/acquisitions.
Michael E. Stevens, executive vice president of retail and leasing for Forest City Enterprises, was recently awarded the 2011 ICSC (International Council of Shopping Centers) Trustees Distinguished Service Award. This is the highest honor awarded by ICSC and is the association’s most prestigious official recognition of distinguished service and contribution to the association, to the worldwide retail real estate industry and to the community at large.
Dave Sobochan, principal in the tax department of Cohen & Co., was awarded the 2011 Member of the Year Award from the Northern Ohio Chapter of NAIOP, the commercial real estate development association.
Gene D. Karlen joined Javitch, Block and Rathbone as director of human resources. Karlen has 12 years of experience in human resources.
The Museum of Contemporary Art Cleveland recently elected officers and six new members of its board of directors.
Officers include: Scott Mueller, chairman of the board, who is president and CEO of Dealer Tire; Mary Ann Stropkay, president, chief credit officer of Park View Federal Savings Bank; Toby Devan Lewis, vice president; Char Fowler, vice president; and Scott Bogard, treasurer, senior associate at The Riverside Co.
New board members are: Kristen M. Bihary, vice president, communications at Aleris; Joanne Cohen, executive director and curator of Cleveland Clinic’s art program; David Doll, senior vice president of investments at UBS; Jen Grossman, co-owner of National Safety Apparel; Grosvie Robinson Cooley; and Bassem A. Mansour, co-CEO of Resilience Capital Partners.
Morton’s the Steakhouse Cleveland hired Denise Afflerbach as the new assistant manager. She most recently served as food and beverage manager at the TPC
Sawgrass golf club in Jacksonville, Fla., where she gained extensive hospitality management experience.
MedData hired Brenda N. Brown as director of compliance audits and education. In this newly created position, she will be responsible for providing ongoing documentation, training and education to MedData’s clinical and coding staff to ensure operational compliance and optimal reimbursement.
Please send your executive-level promotions to firstname.lastname@example.org.
After being frustrated with a long wait at home for a customer service appointment,
Yuval Brisker realized he could build a company while solving his own problem. He created TOA Technologies and designed a Web-based user interface that now serves as the only cloud-based, enterprise-level, on-demand mobile work force management solution to make real-time visibility and change possible.
Serving as CEO, Brisker’s company currently manages more than 50 million appointments annually for many global brands in the telecommunications, utilities, retail and home services industries, bridging the gap between mobile work force management and customer relationship management. TOA’s patented ETAdirect solution enhances customer service by predicting, with 96 percent accuracy, when a field employee will arrive at a customer’s home. This solution reduces customer wait times while increasing field work efficiency.
Mobile workers can use ETAdirect to access their company’s system via any Web-enabled mobile device, including new features specifically developed for the iPad. They can then provide dispatchers and field management with complete, real-time dashboard visibility and control of their team’s activities. TOA’s clients see increased efficiency, improved customer satisfaction and significant reduction in operating costs. In fact, TOA clients can save an average of $18,000 per mobile worker annually and have reported 98 percent customer satisfaction rates.
Brisker and TOA Technologies have been able to make the service experience better for providers and customers alike by making mobile work force management easier and faster. One of the fastest-growing companies in Northeast Ohio, TOA continues to receive recognition for its innovative vision. The company has previously earned Gartner’s “Visionary” designation in the Field Service Management Magic Quadrant every year from 2007 to 2010, and the Gartner’s 2010 report named the company a “Best of Breed.”
How to reach: TOA Technologies, (216) 925-5950 or www.toatech.com
Maintaining a passion for his doctoral thesis work in visual recognition, Simon
Melikian continued to explore new concepts in the field for years after completing his thesis. His hard work and experimentation paid off when he solved the mathematical equation for human vision and visual recognition.
Melikian patented his work, and in 2007, he started Recognition Robotics Inc. to pursue industrial applications for his groundbreaking technology. After receiving an innovation fund award in 2009 from the Lorain County Community College Foundation, Melikian began successful market trials that have since attracted the attention of the robotic guidance industry. Able to give inanimate objects such as robots the ability to see and recognize images as humans do through a software package and single video camera, Recognition Robotics’ products can compute an object’s position in space.
The company’s CortexVision software technology combines Melikian’s unique visual recognition system with a self-learn teaching feature and simple computer interface, duplicating the human vision process and allowing for six degrees of spatial freedom. Such technology has been employed in more than 40 auto assembly installations around the world by two of the world’s leading robot manufacturers, Comau and Motoman, making them more efficient and cost-effective.
Recognition Robotics has also used visual recognition technology to develop a product line of new industrial measurement sensors, called Lucana 3D Sensors. These handheld sensors employ a laser camera and software package that allows manufacturers to measure different dimensions instantly without the need for calibration or programming. At the laboratory stage, Recognition Robotics has been developing numerous other commercial applications for visual recognition technology such as devices for the visually impaired, art forgery detection systems and image recognition for social websites.
Expecting to nearly double its 2010 sales this year, Recognition Robotics has the potential to change many markets using Milikian’s innovative visual recognition technology.
How to reach: Recognition Robotics Inc., (440) 590-0499 or www.recognitionrobotics.com
Sometimes it can be difficult to come up with ways to be visionary and
innovative, but those are the keys to taking a business from simply a me-too player to being a competitive leader in any given industry. While it may be a challenge, Frank DiTomasso definitely had a vision as general manager of Farris Engineering.
The company is a business unit of Curtiss-Wright Flow Control and has designed and produced a wide range of spring-loaded and pilot-operated pressure relief valves for more than six decades. The company has always been a pioneer in the field and many of its products remain industry standards. Of course it should be a pioneer. The parent company was originally formed as companies merged, which were founded by Orville and Wilbur Wright and Glenn Curtiss, the father of naval aviation. With those kinds of shoes to fill, it’s no wonder that innovation plays such a big role at the company and the way it approaches creating its products.
But as the company has created industry-leading products, competitors have followed suit, so DiTomasso knew that he had to come up with a new differentiating strategy that would allow Farris to gain a competitive edge.
He had a vision to become a “complete solution provider” to the industry. He released a multidisciplined engineering project to design and develop a Web-based engineering software that would satisfy audit requirements for pressure relief systems. He recognized early on that with an ever-increasing competitive environment, software technology could support the ability of operating facilities to improve plant productivity, reduce cost and risk, and enhance manufacturing uptime — and, most importantly, comply with OSHA guidelines.
Today’s new software technologies host a range of new forward-thinking approaches and tools that can meet and surpass these challenges. This new generation of software will help process-related companies stay on top of managing existing or new pressure-relief systems. The new software is Web-centric technology that allows plant employees instantaneous access and analysis to data on any pressure-relief system from any location that has Web connectivity. This allows employees to proactively resolve system problems while also offering the most thorough and systematic approach for the design, analysis and documentation of new or existing pressure relief systems.
The strategy has been an immense success under DiTomasso’s leadership. The core product that Farris manufactures has seen an increase of business in a slow economy. The future forecasts are even more positive, which will certainly allow Farris engineering to grow its manufacturing presence in the Ohio market — something the state definitely needs.
As the company moves forward, DiTomasso will remain committed to moving Farris forward by continuing to innovate and keep its technology ahead of all the competitors.
How to reach: Farris Engineering, (440) 838-7690 or farris.cwfc.com
There is a common saying that one man’s trash is another man’s treasure.
But Magnus International Group co-founders and co-owners Eric Lofquist and Scott Forster have found ways to turn a lot of men’s trash into treasure that benefits the whole planet.
Lofquist, president and CEO, and Forster, vice president and COO, have designed innovative systems to salvage waste materials and transform them into sustainable global products. Their company comprises four primary entities that develop and manufacture organic components for eco-friendly products: Hardy Animal Nutrition, which processes naturally derived vegetable products to be used in the manufacturing of custom-formulated feed for production animals; Hardy Industrial Technologies, which converts vegetable oils into all-natural industrial and consumer product wax, renewable fuels and dust control agents; Recycling & Treatment Technologies, which effectively and safely process oil and water emulsions in two locations; and Renewable Energy Management, which also converts vegetable oils into all-natural industrial and consumer product wax, animal feeds and renewable and biodiesel fuels.
Lofquist’s and Forster’s commitment to innovation in the renewable and environment industry goes beyond the all-natural products that Magnus produces, however. Sustainability is an important part of how their products are manufactured. Magnus companies’ proprietary technologies utilize landfill gas as a substitute for natural gas. Additionally, Hardy Industrial Technologies and Recycling & Treatment Technologies of Ohio also run on local lake water. Magnus has a number of other pollution prevention, energy-saving and cost-reducing initiatives in place that are setting new standards for sustainability.
Magnus acts on its commitment to corporate and environmental responsibility, conducting research and development as well as partnering with companies to provide sustainable products for the global market. Magnus’ all-natural animal feeds, renewable liquid fuels and industrial and consumer waxes serve as green substitutes to synthetic options available to suppliers and consumers.
How to reach: Magnus International Group, (216) 592-8355 or www.magnusig.com