How can your company improve its business results? One way is by optimizing your firm’s use of patents. The right strategies for leveraging patent properties can provide long-term advantages and a leg up on the competition.
The following strategies are useful starting points for enhancing business outcomes through patents:
Consider patents’ financial qualities
The same analytical constructs that apply to financial asset management can be applied to patent management. When managing financial assets, it is prudent to consider things like expected future cash flows, return on investment and relative risk profile. Understanding this information helps businesses with limited resources to select the most profitable investments and manage risk.
Likewise, expected cash flows from internal commercialization of a patent or out-licensing royalties can be forecast, returns on patent research and development investments measured, and relative risk profiles of patents assessed. By considering these financial characteristics associated with their patents, companies can make better decisions and optimize value.
Understanding patents’ financial qualities, for instance, can shed light on which monetization route — commercialization, licensing or sale — is most desirable for a given patent or group of patents. It can also help a company strategically leverage its operations to support patent value and vice versa.
Recognize the risk profile of patents
All assets, including patents, carry risk. Importantly, the type and level of risks in patents vary according to a patents’ economic life, the technology it discloses and the industries touched by the technology. For example, certain patents in fast-moving industries may carry the risk of rapid technological obsolescence, while other patents’ technologies may face uncertain or very slow market adoption.
Holding several patents that relate to a steadily selling product may suggest financial stability but also may imply a high level of risk concentration since several patents’ values may be impacted by a single product’s market performance.
Evaluating risks associated with patents can lay the foundation for comparative risk analysis and superior strategy planning. By understanding the relative risk levels of patents in a given portfolio and how those risks align or differ from broader business risks, companies can efficiently diversify.
Effective diversification of a patent portfolio can be achieved by holding the right mix of patents and by utilizing the proper combination of monetization techniques for those patents. Notably, effective patent risk management can be done without straying from a firm’s core competencies since even patents with similar technological profiles may have substantially dissimilar risk profiles.
Execute strategic patent
transactions with care
Due diligence in executing patent deals should be analytics-based, and care should be given to the broader business implications of any transaction. In this regard, appropriate qualitative and quantitative analysis should be deployed. Proper evaluation can help parties maximize value obtained through a transaction and ensure any deal comports with prevailing strategic initiatives, financial goals and desired competitive positioning.
Factors that should be considered in executing any patent deal include the following:
■ Values paid or received by others for comparable technologies.
■ Alternatives to reaching an agreement, including design-around cost/benefit analysis and assessment of the risk-adjusted outcomes of not executing a transaction.
■ Immediate and subsequent financial benefits, such as cash flow, “option” value and defensive patent aggregation security.
■ Possibilities for using the patent deal to foster broader strategic relationships or forestall undesirable competitor activity.
■ Value and risk implications of the contemplated deal on other patents in a portfolio.
When managed carefully and used cleverly, patents can be especially powerful tools for a business to enhance its bottom line. The right patent strategy can offer an excellent path to improved business results.
Michelle Rakiec and Stevan Porter are managing directors at AdValum Consulting, a premier provider of expert economic consulting services located in Chicago. They specialize in strategy, valuation and damages analysis in intellectual property matters. Rakiec and Porter can be contacted at
However, companies taking a “wait-and-see” approach to deal-making as economic uncertainty persists, may be missing out on growth and value opportunities.
Many companies have looked to divestments to offset cash and credit challenges and to free up capital to drive growth. But this short-term thinking is shifting as companies plan for the long term and take a more strategic approach to divesting.
In a recent EY divestment study that surveyed almost 600 executives, 77 percent said they planned to accelerate divestments within the next two years, and 46 percent are planning to divest in the same time frame. As companies signal an increased appetite for divestitures, it’s important they understand and implement the appropriate steps to achieve greater value for shareholders.
Evidence from our study, combined with our work with clients, has shown that there are five leading practices that companies should follow in order to execute a successful divestment:
Conduct rigorous and regular portfolio management
Review your portfolio regularly. Companies can assess whether assets are contributing to strategic goals or if capital can be better used for other purposes.
Companies that use divestments as a strategic tool to enhance shareholder value or focus on core business strategies, rather than considering them as a reactive move to free up cash or pay down debt, tend to improve their divestment results.
Consider the full range of potential buyers
There is an intense amount of competition from buyers today for good, high-quality assets and they’re ready to transact. Appealing to a broad group of buyers can garner a price that exceeds expectations.
Companies should think about the buyer universe for a potential asset sale differently than they might have in the past, considering potential foreign buyers, buyers within different sectors and private equity firms. Each buyer may have different information needs that require a different planning process.
Articulate a compelling value and growth story
Sellers should provide tailored information about how an asset fits with the buyer’s business to help achieve strategic objectives. Develop an M&A plan for the asset or provide a view of synergy opportunities to buyers.
Effective ongoing preparation can instill buyer confidence. As a result, companies can better control the process and realize greater speed and value. Half of the executives surveyed admit that certain changes to the preparation process could have made a significant difference during divestment.
Understand the importance of separation planning
Probably the most crucial aspect of a divestment is separation planning, yet 56 percent of respondents identified a clear separation road map as the most complex part of the divestment.
Other separation challenges include decisions regarding the completion mechanism, tax planning, estimating stand-alone costs and negotiating transition services agreements.
Every day a company waits to evaluate its capital strategy, someone else is making a change and gaining an advantage.
In heeding these five key practices, companies can take a more strategic and ultimately successful approach to divestments to ensure they get the most value possible and grow the bottom line.
Paul Hammes is the Divestiture Advisory Services Leader for Transaction Advisory Services at EY. Reach him at www.ey.com.
Bruce Leon has seen managers who work 12 to 13 hours every day who are not shy about telling others how overworked they are in their job. He’s also looked deeper into the way some of those managers spend their day.
“When you really dive into it, they are doing the same things all the time,” says Leon, president at Tandem HR. “They are dealing with the same sorts of customer issues and complaints.”
Leon tries to encourage managers who find themselves in this predicament to analyze their workday with the goal of getting to the root cause of the problem and coming up with a solution.
“I push them to find the core reason why it’s happening and see if they can get as much done, if not more, and have a regular eight-hour day,” Leon says. “Some of them can’t do it or they are unwilling to admit that there is a better way. They just think it’s a fact of life that they are overwhelmed with work.”
Those who are unwilling to adapt become a big problem for Leon in an industry that is changing by leaps and bounds.
“You can’t make a five-year business plan today with any real comfort that those will be the issues you’ll be dealing with over the next five years,” Leon says. “For many of us, that’s a scary thing not to be able to plan out that far ahead. But I think the critical thing is if you’re able to keep up with those changes, you can have a much better opportunity with customers than those companies that aren’t keeping up with the market.”
And so the key to being one of those companies that can keep up is having leaders who aren’t afraid of change and who see the opportunity in every challenge.
“Are they leaders or are they managers?” Leon says. “I want to know their ability to innovate and I’m really looking to see how much they are proactively looking at change and how much they are reactively looking at change.”
Find your problem solvers
One of the first things Leon wants to see when he’s appraising a leader is proof that he or she is a leader who can get things done.
“You try to find people who have been successful in many aspects of their lives,” Leon says.
“Family, extracurricular activities, philanthropy. What is their involvement? There is no fail-safe method and if there were, we’d all have an easier time of it. But one of the best things you can find is people who can communicate very specifically about how they’ve done leadership things in the past and how they were successful at them. I want specifics and even people I can call to verify it.”
When you’re assessing current leaders, observe how they behave in various situations.
“When a problem arises, they just look for issues where they will perceive to be involved and then quickly exonerate themselves at the expense of throwing other people under the bus,” Leon says. “You see managers who will not let some of their good talent go to other departments, even if it means a promotion to an area where the company really could use them. People who refuse to engage in cross-training and documentation of all the processes they do.”
It takes an effort on your part to get a good read on a person, but it helps you understand which employees you can count on in a tough situation and who doesn’t have what it takes.
“We’re trying to put the right people in place so that we can scale with only having to add lower-level people to build up for the growth,” Leon says. “But I do think the people who are running your company at 30 employees are not always the same people who are going to run it at 130.”
Some of the skills that you look for are a desire to grow, the ability to be self-critical and a willingness to accept constructive criticism.
“It’s the ability to not be threatened by hiring strong people beneath them,” Leon says. “Leaders also have a strong customer service aptitude. They really have a passion for what they do. It’s not a job.”
The ideal leader you are looking for is similar to the manager at Tandem HR who was feeling swamped by his workload and was willing to take an introspective look at what he and his team were doing.
“The ones who are good can step away, get their teams together and go over the core reasons for the problem,” Leon says.
“I had one of them that came up with a call center that has been solving 93 percent of 12 customer issues they were having. It previously took multiple phone calls and voice messages and now we solve issues in eight seconds through the call center. It came about from a manager taking his group out and looking at every customer issue that was coming in and figuring out how they could streamline it.”
Don’t allow silos
Silos are another pitfall for managers. Leaders who feel insecure about their place in the organization often create them.
“People artificially create silos in a way to build their own inner security system or to build a moat around their work,” Leon says. “I think it has to do with egos and peoples’ inability to be open, transparent and willing to share. It’s the perception people feel that if they are the only ones who can do something, they will have job security.”
Having insecure managers in your company is obviously not a good thing. But the bigger problem is created when you have a situation where a leader leaves the company or is unavailable for some reason to deal with an issue related to their department.
“Everybody has to imagine what their job would be like if tomorrow, they were hit by a car and someone else had to step in and do their job for them,” Leon says.
This is not just a mind exercise for Leon, however. He wants a real action plan in place in case such an unfortunate scenario happens.
“I want to see that documented,” Leon says. “I want to see that really existing. I want to see the results of it.”
One of the ways to prevent silos from forming is to occasionally move people around to different areas of your business.
“We switch around a lot of the administrative people in different departments so nobody gets locked into one unit,” Leon says. “It forces people to be cross-trained and it prevents that natural us-versus-them attitude in the company.”
Another step that isn’t always an option for some companies is to put more people under one roof. This was an option at Tandem HR as the company is in the process of consolidating from seven to two locations. The prevention of silos was not the main reason for the move, but it will be one of the benefits when the transition is complete.
“It’s building people to be more non-siloed and building recognition between the family of companies that we have,” Leon says. “We can also streamline shared services. We hope to save a fair amount of money on shared services with the relocation.”
Going forward at Tandem HR, new employees will be given the chance to spend time in different parts of the business.
“Even if they have been brought in as a benefits specialist, they are going to spend some time in payroll or HR or 401(k) or with risk,” Leon says. “They are going to have to learn those units as a new employee.”
The cross training is part of a six-month program where employees learn about other positions as they get up to speed on the job for which they were hired.
“We do monitor their level of competency by their performance,” Leon says. “They take tests along the way as they are learning just so we can gauge how they comprehend the material.”
Check your own ego
As much as Leon works on appraising the leaders in his company, he strongly believes that he needs to fall under the same microscope in terms of how he performs his job as president.
“Many a bad business decision and many a bad leadership decision came from unchecked ego,” Leon says. “Sometimes you have to put people in place, but that can also be you. Every CEO needs their own check.”
The person or people that you ask to judge your performance need to be able to do so with honesty and without concern that negative feedback will be met with hostility.
“Without that, the likelihood that you make ego-related bad decisions or you make bad personnel decisions or you get yourself involved in activities that hurt the company is too great,” Leon says. “It’s a critical point for me personally and one I try to share with CEOs.”
Fortunately for Leon, he seems to have a pretty effective team of leaders, including himself. The company hit $355 million in revenue in 2012 and Leon feels good about the future. But he’s not one to take a lot of the credit for making it happen.
“You have to be thankful every day for having the opportunity you have,” Leon says. “It could change very dramatically tomorrow.”
How to reach: Tandem HR, (630) 928-0510 or
The Leon File
What is the best business lesson you ever learned? Always hire ahead of the curve, both in terms of numbers and talent. There’s more than a 50 percent difference between a $100,000 employee and a $150,000 employee.
As you grow, you need to get better talent and go outside of your budget to get it ahead of time. It’s very difficult to do it after the fact. You often make bad hiring decisions because you’re pressured and then people walk into a situation that’s like a house on fire, which is not a good way to start.
By hiring ahead of the growth curve, it gives you a chance to find the right people, get them trained and not to have the house-on-fire first day. A lot of business people, myself included, say I’m going to wait until I hit those targets or until we get the revenue or our profits are up before we hire that senior level person. Sometimes, it’s too late.
What traits or skills are essential for a leader? Everybody has different leadership styles. For me, my leadership style is that I am very transparent. I admit my mistakes very quickly with my senior executives and let them know they will never get fired here for making a mistake. But they will get fired for withholding information and for not admitting when the mistake happened. I try to lead by example with that all the time.
What’s your definition of success? It’s to know at the end of the day that I did all I could to further the values of this company, and I was able to make an impact in the industry that I serve.
Study your current leaders.
Promote inclusive leadership.
Let people judge your perfromance.
Business operations are subject to a number of internal and external risks, as are ownership interests in businesses. How organizations and their owners address these risks can have a significant impact on the value of businesses and interests therein.
“An enterprise risk management process involves identifying risks relative to an organization’s objectives, assessing them for likelihood and impact, developing a response strategy and monitoring progress,” says John T. Alfonsi, managing director at Cendrowski Corporate Advisors.
A well-defined enterprise management process (ERM) framework can protect and create value for organizations and their owners, he says.
Smart Business spoke with Alfonsi about ERM to better understand its applications.
Where is risk addressed in a business valuation?
The most common method of valuing a business is the ‘income approach,’ which requires a valuation analyst to project a business’s future cash flows, then calculate the present value of the sum of these cash flows by employing an appropriate discount rate. The valuation analyst must address risk in two primary areas: projected future cash flows and the discount rate. Effective ERM processes can help businesses increase value by affecting the estimates for these quantities.
How does risk impact projected cash flow?
There exists a risk that an organization will not achieve its projected figures. As such, the process by which management projects future cash flows can impact a valuation analyst’s assessment of the business. A key risk in the process is information integrity, the quality of information generated through monitoring and data assimilation.
Information integrity allows management to make well-informed decisions and should provide a valuation analyst with greater confidence in a business’s projections.
Valuation analysts can analyze information integrity by examining historical projections and assessing elements of the internal control environment.
A valuation analyst also should examine the variance between historical projections and a business’s actual performance. If a strong correlation exists, a valuation analyst can be highly confident in current projections, if the process employed by the organization remains constant. If not, the analyst must examine the variance between the past projections and actual performance to discern whether bias existed in past estimates and current projections.
What about risks in the discount rate?
The discount rate is the yield necessary to attract capital to a particular investment, given the risks associated with that investment. A project with relatively high risk will require a relatively high yield to compensate an investor for bearing these risks.
In determining the discount rate, there are two sources of risk that need to be quantified: systematic and unsystematic.
Systematic risk is the risk one must bear for taking on a risky investment in the market. However, systematic risk is estimated by calculating the return to public equities due to availability of data. The ERM process has little impact on systematic risks unless the business’s performance is heavily tied to market performance.
Unsystematic risk is sometimes broken down into two components, industry risk and company-specific risk. Industry risk reflects the risks identified with the industry in which a business operates. Company-specific risks encompass all other risks, including size, depth of management, geography of operations, customer and/or vendor concentration, competition and financial health.
How can ERM processes mitigate company-specific risks and increase value?
An ERM process should quickly gather and assimilate high-quality information for use in the organization’s decision-making process, allowing the organization to rapidly assess the impact and likelihood of risks associated with changes in its internal and external environments. Early assessment and mitigation can help preserve value and capitalize on risky events when competitors do not react as swiftly to environmental changes
John T. Alfonsi is managing director at Cendrowski Corporate Advisors. Reach him at (866) 717-1607 or firstname.lastname@example.org.
Insights Accounting is brought to you by Cendrowski Corporate Advisors LLC
Today’s workforce is unique in that there are now four generations of people working together — traditionalists born from the 1920s to the 1940s, baby boomers, Generation X and millennials.
That presents challenges to employers in bridging generational gaps and getting workers on the same page.
“There are now four generations of people in the workforce, and they all bring something very different to the table. They have unique characteristics in terms of values and what is important to them personally,” says Liz Howe, Director of Business Development at Benefitdecisions, Inc.
“There is a lot of buzz about the lack of communication among the generations. They come from different places and have different ways of doing things. It’s about getting them to play in the same sandbox, if you will.”
Smart Business spoke with Howe about the differences between generations and the affect it has on the workplace.
There have always been multiple generations in the workforce, how is it different now?
It’s that there are still people born in the ‘20s to ‘40s in the workforce in high, C-level roles, along with baby boomers, Generation X and young kids out of college.
Combine that with the progress made over the last 20 or 30 years in technology and the Internet. The world is a completely different place and that can pose challenges in getting things done. One segment of workers says, ‘This is how it’s been done,” while another says, ‘Why do we do it this way?’
How can you bring them all together?
Companies need to consider what’s important to each group. The traditional generation was raised in a really hard time and tends to revert to how things used to be done; Generation Xers don’t identify with that. If you have a Gen Xer managing a traditionalist, he or she needs to think about what is important to that person — a flexible work arrangement, succession planning and teaching them technology.
That same manager would handle a millennial differently. Priorities to a millennial are having a work/life balance and having a relationship with his or her supervisor that doesn’t involve micromanagement, but more of a team-oriented approach. So it might be more of a mentorship than just being a work manager.
With baby boomers, no news is good news. If a manager isn’t calling and asking questions, they’re in good standing.
What is the danger of managing everyone the same?
You lose the employee engagement factor, which is a hot topic these days. Millennials aren’t as loyal to companies as baby boomers, and if they’re not happy they will leave for a company that better fits their culture. That has become more socially acceptable and other generations are seeing that. Ten to 15 years ago it wasn’t acceptable to have four or five companies on your resume, now tenure is three years before people want a promotion or a different role.
You need to be thoughtful about managing employees and what types of benefits you’re providing by catering to what they find important. There’s been a real push toward wellness programs. Some businesses provide different types of insurance — pet insurance is huge. Other companies will match charitable contributions to an organization of the employee’s choice rather than just giving a cash bonus. People today are much less monetarily driven than they’ve ever been.
What are the benefits of having all of these generations together?
It brings some depth and breath of knowledge to an organization, along with a wide variety of skill sets. It’s an advantage to have people raised at a time when there was little or no technology all the way down to people who don’t know anything but technology and the Internet.
The challenge is to get them to communicate with each other so you can take full advantage of their knowledge.
Liz Howe is director of Business Development at Benefitdecisions, Inc. Reach her at (312) 376-0452 or email@example.com.
Insights Employee Benefits is brought to you by Benefitdecisions, Inc.
Health care cost transparency is the ability of patients to learn how much a medical service or treatment costs, preferably before receiving the service or treatment. This is important because treatment and service costs vary widely from doctor to doctor and from facility to facility.
“In all my travels, with all the different hospitals I visit — hundreds of them — only one had the general charges of fees and services, like cost per day in the hospital, posted up on the wall. It just doesn’t exist today,” says Mark Haegele, director, sales and account management, at HealthLink.
“This system has made it difficult for people to get the information. We’re getting there, but a spotlight on transparency and the cost and options gives people a little more decision-making authority,” he says.
Smart Business spoke with Haegele about the shift toward transparency and helping employees shop for better health care prices.
Why do health care prices vary so much?
Physicians are just trying to diagnose you to help you get better. In addition, surgeons only get paid if they recommend surgery. So, cost doesn’t really weigh into whether patients get knee replacement surgery or are sent to therapy for six months.
If you go to a store and look for a refrigerator, one of the first things you try to figure out is the price. But if you go to the doctor, and you’re talking about getting your knee replaced, that conversation — if it ever comes up — comes up at the very end.
The average treatment for heart failure might vary by tens of thousands of dollars within the same city. A list of Medicare costs, released by the Centers for Medicare & Medicaid Services, found a difference of $21,000 to $46,000 in Denver, Colo., or $9,000 to $51,000 in Jackson, Miss.
Only some rate differences are because of health care’s complexity. If two people with the same insurance get a tonsillectomy at the same hospital, they still could have different doctors ordering different levels of anesthesia and pain medicine with different philosophies on hospital-stay length.
How does transparency lower costs?
As the government, media and patients push for reliable cost and quality information, it motivates the entire system to provide better care for less money. For example, according to the book “Unaccountable: What Hospitals Won’t Tell You and How Transparency Can Revolutionize Health Care,” the governor of New York mandated that hospitals publish their mortality rates for heart surgery. By the year following, hospitals started implementing quality metrics to reduce mortality, and the trend in the mortality rates dropped dramatically, which ultimately saved lives.
In another instance, a Thomson Reuters study of a Chicago employer found a cost variance of 125 percent for health insurance members receiving an MRI of the lower back without dye, with similar differences in diagnostic colonoscopies and knee arthroscopy procedures. If employees were given information to select providers at or below the median cost, it was estimated the company could save $83,000.
What can benefit administrators do to help facilitate transparency?
As a general rule we feel helpless, but there are some things benefit administrators can do to move costs. You’ve got to get information out to members, and then align incentives. The average member, once he or she meets the $2,000 out-of-pocket maximum, for example, doesn’t care if a hip replacement costs $5,300 or $223,000. They should — but most don’t make better purchasing decisions until it impacts them.
Under a self-funded health plan, you have more control over what you are able to publish and demonstrate to employees, as well as more ability to align incentives. But regardless, you need to start identifying costs of providers of key procedures to treat your health plan like an asset.
By putting together a best-in-class grid for your members, and then aligning incentives to ensure they use the lowest cost providers, such as giving a $200 gift card, you can empower your members and move the needle on health care cost.
Mark Haegele is director of sales and account management at HealthLink. Reach him at (314) 753-2100 or firstname.lastname@example.org.
Website: Visit the website to learn more about transparency and other key health care business trends.
Insights Health Care is brought to you by HealthLink
The purpose of an arbitration clause is to resolve disputes by means of a private proceeding that is generally perceived as quicker and less expensive than the court system. Yet many contracting parties do not fully analyze the arbitration clauses in their contracts, and so do not draft such provisions in a comprehensive and precise manner. These lapses can lead to costly and time-consuming disputes.
“Any party entering into an arbitration agreement, therefore, would be wise to carefully analyze the arbitration clause thoroughly, with a view to ensuring that it will accomplish all of the party’s goals,” says Courtney D. Tedrowe, a commercial litigation partner at Novack and Macey LLP.
Smart Business spoke with Tedrowe about what it takes to draft an effective arbitration clause.
What are the key considerations in drafting an arbitration clause?
Broadly speaking, there are two categories of issues to consider when drafting an arbitration clause. The first of these concerns the extent to which the court will be involved in pre-arbitration and post-arbitration issues. The second category concerns the parameters and procedures of the arbitration proceeding.
Why consider the court’s involvement in pre- and post-arbitration proceedings?
Just because you have an arbitration clause doesn’t mean that you will avoid court proceedings. Not infrequently, a party will oppose the arbitration demand on the grounds that it does not fall within the scope of the arbitration clause. Under the Federal Arbitration Act, courts are required to ensure that the claim is arbitrable. However, the arbitration clause can specify that the arbitrator decides such substantive ‘arbitrability’ issues, effectively limiting the court’s role from the very outset.
The parties may also restrict the court’s involvement in post-arbitration proceedings. Some post-arbitration judicial action is inevitable, since courts, not arbitrators, have the power to reduce the arbitration award to an enforceable judgment and to decide any challenges to the award. Here, the parties can use the arbitration clause to limit the grounds of appeal, further reducing the chances that the award is vacated, and minimizing the risk of lengthy appeals.
How should the arbitration clause be drafted to provide for procedural matters?
Parties can agree to pretty much whatever they want when it come to procedures. Typically, agreements simply select an organization’s rules, such as the American Arbitration Association, JAMS or ADR Systems.
There are two big pitfalls here. First, most organizations have more than one set of rules with sometimes very different deadlines, discovery options and evidentiary rules. When drafting the clause, be sure that you select not just the organization, but the specific set of rules most favorable to the particular situation.
Second, organizations change their rules regularly, meaning parties will likely be bound to use the rules in effect at the time of the dispute, which may have changed.
Can parties modify the applicable rules?
Yes. For example, although the rules of evidence do not typically apply in arbitration, parties may specify that they will apply, or that only certain rules of evidence apply. Parties also have the ability to craft the discovery process to their particular situation. The arbitration clause can set forth, among other things: whether parties may take depositions and, if so, how many; whether documents requests and interrogatories will be allowed and, if so, how many; and the parameters of any other discovery method.
The clause may also deal with the hearing location; pre- and post-arbitration motions, such as motions to dismiss; and the arbitrator’s power to fashion specific remedies.
How much freedom do the parties have to control the arbitrator selection process?
Parties have complete control over who arbitrates their dispute. The specific arbitrator could be identified in the clause, or the clause can set forth the rules by which an arbitrator is selected, either expressly or by selection of a particular organization’s rules.
Courtney D. Tedrowe is a commercial litigation partner at Novack and Macey LLP. Reach him at (312) 419-6900 or email@example.com.
Insights Legal Affairs is brought to you by Novack and Macey LLP
Recognized as one of the world’s most prestigious business award programs, the Ernst & Young Entrepreneur Of The Year Awards celebrate gravity-defying innovators who build and run great companies. This June, we gather here and in 24 other cities across the U.S. to honor all of our regional finalists and welcome the award recipients from the class of 2013 into our Hall of Fame.
Entrepreneurs change the world and make it a better place to work and live. We honor them for their fortitude and resilience, and we celebrate their ability to forge new markets, navigate uncharted territory and fuel economic growth.
Congratulations to this year’s finalists and winners for their unyielding pursuit of business excellence. We are honored to share their inspiring stories with you.
Todd E. Novak
Midwest program director
Consumer Products and Services
Family Business Award of Excellence
Private Equity/Venture Capital Backed
James Reynolds, Jr.
T. Scott Law saw the trends developing as medical billing continued to get more and more complicated. Thinking there had to be a better way he set out to improve the medical delivery process for medical practices by founding Zotec Partners in 1998 as a solution.
Now, insurance submissions and rejection appeals, which in the past had taken upwards of 13 minutes to prepare, can be completed more accurately in seconds using Zotec’s advanced Electronic Billing Center software programming and client-focused support personnel.
Zotec has functioned as both a software licensor and a billing service provider, though these two arms originally operated independently. Clients could choose to only license the software, or they could also choose to partner with Zotec’s billing services team.
After working under this model for many years, Law recognized that there was room for improvement. Clients that chose only to license the EBC software were not achieving the level of efficiency he knew could be reached by Zotec’s services team.
Relying on a billing team at Law’s small start-up company that had yet to build a recognizable brand was understandably not palatable for clients. They were comfortable using the EBC software, but Law felt there was a greater method to help improve client bottom lines.
Over time, Zotec has earned its clients’ trust, primarily due to Law’s continual focus on providing a quality software product and personalized experience. In 2007, Law believed that his company had generated enough credibility and was ready to be taken in a completely new direction. He shifted Zotec to a “bundle” approach, where clients could no longer license the software separately from the service.
By providing a bundled offering with consultative services included, all clients now have access to an experienced billing expert who can provide guidance and support.
Customer reaction to this has been extremely positive, and client bottom-lines improved dramatically as a result.
How to reach: Zotec Partners, www.zotecpartners.com