Dennis “Denny” Sponsel, president of RJE Business Interiors, bought his company in March 2000. Then the contract furniture industry suffered its largest downturn ever, a 42 percent drop.
While many would see doom, Sponsel saw opportunity. He has a strong vision of a special kind of business one that truly cares for customers, earns their trust, operates ethically and gives back to the community. Now, eight years later, revenue has more than tripled.
Sponsel took on his new venture with RJE as a sole owner, but he wasn’t alone. He brought in an experienced management team, but he hefted the very weighty financial burden on his own shoulders. Even in the midst of a struggling economy, he continued to invest in people, places and technology. He opened a new downtown facility, upgraded technology and added key personnel to focus on the company strategy.
He convinced ever-skeptical furniture vendors and customers to work with him and trust him by living up to each commitment that he and RJE made.
“I believe leadership stands tall,” Sponsel says. “My behavior, my example, my communications, my support, my loyalty, my fairness, the way I dress every day it all counts.”
On RJE’s Web site, all inquiries go directly to Sponsel, and he responds to each one.
“It is that personal touch and that personal commitment that mean everything,” Sponsel says.
It’s this kind of service and commitment that transformed a failing business into a community leader.
HOW TO REACH: RJE Business Interiors, www.rjefurn.com
Sportvision has endured many trials, both financial and on the business front. Through it all, Hank Adams, CEO, has persevered to turn the business around while attracting and retaining key company personnel and protecting investor’s interests.
Sportvisions’ products are well-known. It was founded in 1998 with a vision to develop technological enhancements that could be used in game broadcasts. Through the development of landmark products, such as the glowing puck in hockey, the Yellow 1st and Ten line and Kzone, Sportvision has established itself as the most innovative player in the industry.
While both clients and fans love the company’s iconic products, it is a challenge to present a clear value proposition to clients. Media executives realize that, in the short-term, the same number of Bears fans will watch a given game and that advertisers will buy ads even if the broadcast does not have the “yellow line.” It is a long-term investment proposition for executives who live on overnight ratings.
In 2002, Adams had to withstand shrinking production budgets, desperate competitors who slashed prices and exhausted investors.
Adams managed to turn the operation and morale around, and Sportvision is now profitable with solid growth, a bright future and high retention. The company has won eight National Sports Emmys, and, since its founding, Sportvision is credited by the SportsBusiness Journal with inventing 10 of the top 20 greatest innovations in sports broadcasting.
HOW TO REACH: Sportvision Inc., www.sportvision.com
John Udelhofen, CEO of Laurus Technologies Inc., has been instrumental in the company’s growth and has plans to take it even further.
The company has done very well in the area of systems integration, identity management and ERP consulting. It’s critical for the company to build on its successes in these spaces and grow the existing lines of business in the markets currently served. As well as the firm has performed in these markets, Udelhofen believes the potential is far greater than what has been realized.
In 2007, the company invested in recruiting key management, sales and consulting talent to replace and augment the partnership in key operational roles, allowing the partners to contribute to broader efforts including strategy and planning.
Even though the growth potential for Laurus in the Chicago market has room to more than triple its current size, the company will benefit by replicating its core services in underserved markets. Udelhofen has targeted southern Wisconsin and the greater Minneapolis areas and others are under consideration.
The company has developed a mechanism for evaluating potential markets with regard to Laurus’ offerings and partnerships and is refining a proces to ensure successful entries into new markets.
Each successive line of business brought into the Laurus portfolio has increased the company’s relevance to its customers. Laurus is marching from providing high levels of service in technology fulfillment to software development to business application consulting.
HOW TO REACH: Laurus Technologies Inc., www.laurustech.com
Five years ago, Dave Lindsey told his company’s national convention that “Businesses don’t grow, people do.”
Lindsey, president and founder of DEFENDER Direct, personifies this statement and has worked tirelessly to provide a culture that embodies personal growth as one of four key passions (the others are systems as solutions, developing leaders and expanding influence) that drive the company’s success since its inception 10 years ago.
That commitment to personal growth has served Lindsey and his team well as he has led them through challenges ranging from varied economic conditions, managing fast-paced growth, changing market strategies and attracting talented people to the team. When faced with obstacles, Lindsey has exhibited an uncanny ability to focus on the right priorities and draw his team’s attention there, doing the most important things first and letting the details fall in place behind the strategic needs of the business.
DEFENDER Direct is now the largest dealer in the nation for ADT security systems and Dish Network satellite systems. Lindsey has been an integral part of building these dealer programs and advising his ADT and Dish Network partners on ways they can improve their market position and dealer programs.
His entrepreneurial thinking has added value to both of these partners, and he has been instrumental in helping other dealers improve their businesses. When most other business owners would shun competition, Lindsey embraces an abundance mentality and freely coaches his peers. The end result is a stronger brand and improved business conditions for all.
HOW TO REACH: DEFENDER Direct Inc, www.defenderdirect.com
Growing companies are vitally important to us. They create jobs, support their communities, and provide products and services that help drive the economy. It is hard to imagine where we would be today without the entrepreneurs who create growth companies. They are the visionaries and the risk-takers who believe in their dreams and refuse to be denied. Rather than follow in the footsteps of others, entrepreneurs choose instead to lead, to take the road less traveled.
For the past 22 years, we have proudly recognized outstanding business leaders from the Midwest area program. This year’s Illinois, Indiana and West Michigan participants have succeeded through turbulent economic times and personal sacrifice. They have risen to tackle adversity and change the world as we know it. They’re driven by accomplishment. They have defined sustainability. They’re not afraid to take risks and can see beyond them.
Ernst & Young’s Strategic Growth Markets practice is the leader in serving the Russell 3000 high-growth private companies, those with significant investments from venture capital or private equity firms, and companies planning to go public. We are committed to serving the entrepreneurial companies throughout their life cycle. That’s why we started the Ernst & Young Entrepreneur Of The Year awards. Since the first awards were presented in 1986, more than 12,000 outstanding businessmen and businesswomen have been honored with this distinction.
Join us in congratulating the leaders of today those innovators that have achieved their American dream. We, along with our sponsors and patrons, continue to be inspired and encouraged by the entrepreneurial business achievements of our nominees. The following pages highlight those individuals who pursued this coveted distinction. Ernst & Young is proud to recognize and honor the accomplishments of the people who make this country great.
Congratulations from Ernst & Young on your continued success!
RANDALL L. TAVIERNE is Ernst & Young Entrepreneur Of The Year program director, Midwest Area Strategic Growth Markets leader and a partner at Ernst & Young LLP.
Nicole Loftus was working as an executive in the promotional products industry when she realized the inefficiencies in the way the industry conducted business.
The standard business model was to view the customer through a territorial lens, discouraging any contact between the corporate and end customer and the manufacturers and importers closest to the products.
She knew that she could create a better business model and formed Zorch in 2002 to realize her vision. By emphasizing the branding and merchandising capabilities that Zorch could bring to its corporate customers and de-emphasizing the middle-man role that distributors have traditionally played, the company can be a better partner to its corporate customers. Zorch can deliver a more efficient, responsive order process as it facilitates communication between vendor and customers, it can bring higher levels of sophistication to the merchandising and design decisions and serve as a corporate “brand guardian” as well as deliver lower costs.
Loftus bootstrapped the company with loans from her parents and put up her house as collateral to guarantee bank loans to the business.
As her business model was most applicable to large customers with significant promotional product spending budgets, she faced scrutiny from large Fortune 500 purchasing departments. Nevertheless, through force of will and a compelling customer promotion, she was able to land a major insurance company as her first customer. Now, she has several of the largest companies in the nation as her clients, most of whom source their promotional products exclusively through Zorch.
HOW TO REACH: Zorch International Inc., www.zorch.com
In 1983, Edwin S. “Stan” Hooker III and a partner purchased Midland Paper, Packaging + Supplies from the jaws of bankruptcy. His vision was to create the premier independent wholesale distribution company for fine printing papers in the Midwest. Hooker has never wavered from his original vision.
Those early years presented a number of challenges, including apprehensive suppliers, minimal working capital, bankers looking for personal guarantees and a crowded market of competitors, many of whom had substantial resources.
Year after year, all of the profits were invested back into the business so Hooker could continue to build the business while gaining credibility and trust with suppliers, customers and banks.
MPC prides itself on having a flat management structure, which enables the company to be responsive to its employees and make key or strategic business decisions in a relatively short period of time. In addition, the company’s four stockholders are actively involved in the day-to-day business operations and practice an open-door management style. The culture has allowed the company to double its employee base during the last five years while maintaining a very low turnover rate among its middle- and upper-management team. It also allowed MPC to acquire several companies with a minimal impact on the underlying business.
Today, the company has grown to become one of the largest independent paper and packaging distribution companies in the country.
HOW TO REACH: Midland Paper, Packaging + Supplies, www.midlandpaper.com
True entrepreneurs are never satisfied. They are always pushing the envelope and preparing for future possibilities. Jim Fabris has continuously harnessed that entrepreneurial drive to convert his vision into business realities.
Fabris joined Hurco Cos. Inc. 20 years after its founding, but he quickly understood the value of the company’s mission of providing unique software and equipment to the machining industry.
Combined with his conviction, tenacity and vision, he risked his career more than once to convince the board to make tough choices that were counter to company norms and even industry norms at the time. For example, while competitors continued to focus on the North American market in the 1990s, Fabris understood the value of globalization and the importance of building a strong global supply chain.
Fabris revisited the company’s mission to convince the board that painful choices in the short term were necessary for future growth. Much of the pain was due to his recommendation to abandon legacy products upon which the company was founded, which meant layoffs of employees associated with those products.
“I had to convince them that shrinking would actually make us stronger,” Fabris says.
Focused on the company’s core competencies, Fabris instigates continual innovation of technology that supports the company’s mission. Under his leadership, the company that pioneered interactive graphical computer controls systems continues to push the evolution of technology to new levels, which has led to unprecedented growth and profitability.
HOW TO REACH: Hurco Cos. Inc., www.hurco.com
In 1988, Bejan Douraghy made his way to Chicago with $1,000 in his pocket and an idea for a business. A prior job experience had taught him that you had to treat creative talent with the same level of respect as you treat your customers, because as a creative staffing agency, people are his products and his service.
Five years later, his company, Artisan, had tripled in size. A year after that, he appeared on the cover of Inc. magazine about how bootstrappers change their business practices to foster growth and move beyond the start-up phase.
Almost 14 years later, his words still hold true, and he emphasizes a commitment to his team and to the growth of Artisan, a creative haven for top talent, such as artists and designers, that balances the demands of businesses needing creative services while advocating for the talent filling those needs.
He has built one of the best-known brands in the United States’ creative staffing services industry, serving nearly 2,000 companies and providing challenging work to 8,000 artists. The company continues to gain recognition with promotional events that recognize the best artists and designers in the global creative community.
Douraghy knows that putting together the right people for his client needs is equally as important as putting together the right internal team for Artisan’s culture and sustained success. When employees ask for professional development opportunities, he examines the request, considers an appropriate budget and encourages them to pursue creative endeavors.
HOW TO REACH: Artisan, www.artisantalent.com
“You have no idea how much I appreciate being heard.”
Robert Habeeb read this line from a note he received from an employee in Ohio, and it touched him. As president and chief operating officer of the $165 million hotel management company First Hospitality Group Inc., he could easily spend all of his time in fancy boardrooms in important meetings, but instead, he relishes being out among his 3,000 employees, all of whom he says have stories worth listening to.
He recognizes that when leaders take the time to learn where people are from, ask about their families and find out what their aspirations are, it creates loyalty and trust. And relationships that are built on these casual interactions create stock no leader can buy.
Smart Business spoke with Habeeb about how focusing on employees strengthens your company.
Talk to people. The closer you stay to the front lines, the better informed you’ll be as to what’s really go on in your business. If you get out on the front line where the interaction between the company and the customer takes place and you listen to those folks, you’ll get a great picture of what’s happening in your business.
If you stay in the office and go from meeting to meeting, dealing with executives and expect you’re going to get the full picture of what’s happening in your company, you’re probably mistaken.
If you don’t discipline yourself to put a big black line on the calendar and say, ‘I’m not in the office on this day or during these hours,’ and get out, it’ll never happen because your time will always be hijacked by some other priority.
You get to chat with people and learn a lot about your product and customer. The more that you’re close to your product and the people on the front line, the more that the keeping it real comes naturally rather than it’s a mission.
Find a way to help your employees.We started an employee Web site. When we first rolled it out, we had an all-staff meeting and talked about the site.
At the end of the meeting, the first question was, ‘I don’t have a computer do you know where I could get one?’ A lot of the people that work for us at entry level didn’t have the resources to buy a computer, so we came back and found a company that would co-op with us on helping people buy their first computer.
Anything we can do to help them navigate, people cheer for. It creates loyalty. We want people to be cheerful and friendly, and it certainly contributes to them going to work and making it easy to be cheerful and friendly.
It’s probably the difference in where you have your heart in what you do versus just going through the functions.
Think big. We’d rather get out of bed every day and try something different and have it flop and then pick ourselves up and try something else, as opposed to being an organization where ideas end up on the bulletin board, and the bulletin board committee gathers them and puts them in the log book, and that’s where they die.
We do a car giveaway every year. There came a time when we realized that management by whip and chair was extinct, and to retain people and inspire them to do good things, you have to develop a system that rewards.
Every time you have perfect attendance for a quarter, you get into the lottery. At the end of the year, we draw from the names of all the people who have perfect attendance, and that person has their choice of, this year, a Cadillac Escalade for a year, a Harley Davidson motorcycle to keep, or we paid your living expenses for the year.
That spurned from a lunch conversation we had one day. What’s the cost, and what’s the potential if it improves people’s performance just 10 percent?
Incentive programs should always drive you to some result. The reward should be exciting, and you should have a celebration of the accomplishment. The bigger deal you make of any incentive, the more effective it will be.
Call-offs reduced by 75 percent over the first four quarters where we had it introduced. It’s a long shot that you’re going to win the car, but it’s creating a positive when you get up in the morning and you’re not really sick but you’re making that decision of whether to call off sick or not. It really does change people’s behavior for the better.
Prioritize people. It’s all about where your head is at. What happened at Enron is that management stopped going to work every day thinking about their customers and employees and starting going to work thinking about ‘me’ it’s all about ‘me’ this is what ‘me’ has to do.
Many leaders can accomplish great things while being full of themselves self-confidence and a little bit of arrogance are positive traits but when you break that connection and you’re not genuine anymore, then you’re in the soup.
There’s a barrier that goes up when someone is seen as unapproachable as opposed to someone who walks around chatting with everyone they see. It keeps it real. It keeps you in tune with what’s happening in your company and what’s happening with your customers.
HOW TO REACH: First Hospitality Group Inc., (847) 299-9040 or www.fhginc.com