Dennison, a process engineer at a manufacturing company in Greater Cleveland, proudly boasts of 10 to 12 cups a day, admitting he's addicted to the caffeine.
"I know it's bad for you but it's addicting…it's like smoking," says Dennison.
His argument, however, is he stays away from more harmful drinks like beer and liquor so the health risk is worth it. Or is it?
At any given company, on any given morning, it's standing-room-only by the coffeepot. And as the Java brews, people slowly come to life. In fact, 110 million Americans reach for the legal, addictive stimulant - three times more than soft drinks and four times more than beer - with little concern for the habit or side effects.
But like anything that seems too good to be true, the pick-me-up carries a price. Physicians argue over consumption leads to addiction and like alcohol, carries definite health risks.
The perk in coffee is caffeine, a crystalline alkaloid that affects the brain and artificially lessens fatigue. For the average drinker of two to four cups a day, the drink is relatively harmless.
However, over consumption causes insomnia and jitters, injection into human muscles causes paralysis and a sudden accumulation in your body, say 10 grams or more, results in death.
While few people are caught main-lining coffee, the perked, dripped or instant drink has gained drastic popularity with coffeehouses becoming the savvy meeting place. Mom and dad's cup of coffee has been replaced with expresso, latte and even iced versions. And no matter how it's served, the effect is the same.
According to Kurt Donsbach, Ph.D., an expert in holistic healthcare and author of more than 50 books and booklets, one or more cups of coffee causes your stomach temperature to rise 10 to 15 degrees. Your heart beats faster as blood vessels around the heart widen and those around the brain narrow. Your metabolic rate increases as your kidney manufacture and discharge up to 100 percent more urine.
John Millonzi says he settles for about a cup a day of the brew and isn't addicted. As president of Falken Roth, a wholly owned U.S subsidiary of the forklift arm manufacturer based in Germany, Millonzi is no different than any other busy executive - starting early and ending the day late. He frequently travels between offices in Memphis, Los Angeles, Atlanta and Perry, Ohio and says he has enough stress without adding physical stress from caffeine.
Rather than opt for an artificial boost, Millonzi reaches for his running shoes, jogging three to five miles a day to keep his energy up. He says people who exercise regularly tend not to do abusive things to their bodies like smoking or excessive coffee drinking.
"I just feel better when I run and work out," Millonzi says. "I think the coffee addiction is really just about habit."
Coffee, i.e. caffeine, consumed in normal amounts hasn't been proven to be physically harmful. Tell that to the anxious executive with a trembling hand and dark circles from insomnia. Habit or not, coffee meets two criteria for addiction - it's tolerated by the body in increasingly high doses and its absence creates withdrawal symptoms.
The last characteristic - loss of control - can be judged by your temperment before that first morning cup.
The truth and consequences of caffeine
* Caffeine is classified as a methylxanthine, a stimulant to the central nervous system.
* More than 80 percent of Americans regularly consume caffeine, either from coffee, soft drinks, tea, over-the-counter pain medications or chocolates - making caffeine the world's most widely used drug.
* Soft drinks average between 40 to 60 milligrams of caffeine per eight ounces while caffeine levels vary greatly in coffee - between 66 and 280 per cup - depending on how it is prepared.
* A 1994 study by the American Medical Association indicates coffee drinkers suddenly deprived of coffee suffer headaches, fatigue and depression.
* The study also indicates less than five cups of coffee a day or equivalent consumption in cola or chocolate is not harmful to most people unless shakiness, irregular heart beats or sleep interference occurs.
* A normal level of caffeine is 200 milligrams daily and yet 50 percent of Americans consume more than 300 milligrams every day.
* The effects of caffeine consumption remain with you for six hours.
* An overdose of caffeine causes headaches, irritability, upset stomach, increased heart rate, increased blood pressure and possibly ulcers.
* Physicians are known to prescribe caffeine pills as a cardiac stimulant and mild diuretic.
* The eventual effect of high levels of caffeine in your bloodstream is drowsiness rather than perkiness.
* Drinking unfiltered coffee may cause a short-term increase in LDL (bad) cholesterol levels.
* Caffeine binds to adenosine receptors in the brain causing cell activity to increase, blood vessels to constrict, and the release of adrenaline by the pituitary gland.
* A two-week study of coffee drinkers at the Duke University Medical Center showed people consuming caffeine had higher blood pressure than non-coffee drinkers - an average of three points higher.
* On the up side, a study by the American Chemical Society indicates that consumption of one to three cups of coffee daily shows no affect on the area of the brain involved with addictions.
Although the economy was tenuous with recessions and inflation, it was perhaps a simpler, more innocent time. Debates over school levies were few and far between. But today, tight budgets strain already stretched educational facilities.
That's why Mason is grateful to be a part of Cox Communications, the fifth largest telecommunications company in the United States and perhaps one of the few nationwide organizations to put its money where its heart is on a local basis.
Franchised since 1979 and headquartered in Parma, Cox serves 10 communities in Cleveland's southwest suburbs. Its long-standing tradition of educational and civic support has earned the cable service provider a 2001 Pillar Award for Community Service.
As director of Government Affairs and Education Outreach, Mason spearheads the company-sponsored programs with her four-person staff. Cox employs 125 people, yet more than 100 times that many children benefit from its programs.
Since 1983, area schools have gotten free cable television in the classrooms, not to replace teaching curriculums but to provide teachers with an additional tool. Career days, diversity programs and grants for special learning projects expose children to new worlds. And through its Partners in Proficiency program, Cox covers the costs of proficiency learning tools for all six of the school districts it reaches.
"Every child deserves any and everything a community can give to help with that child's upbringing," says Mason, still as enthusiastic as the day she was hired 21 years ago.
While altruistic, Mason is far from nave.
"If you don't have a quality school system, it reflects on the community," she says. "People start moving out of the community, and the community begins to slide downhill."
Kevin Haynes recently stepped into the positions of vice president and general manager after 23 years with Cox. He says working with children is especially gratifying, and sets thh compnay apart from its biggest compeitors, national satellite companies. Cox's initiatives expand as the needs of the communities grow, he says.
"What we want to be when we grow up speaks volumes of what enabled us to receive this award," says Haynes. "We want to be the best telecommunications company to not only work for, but to do business with while improving the quality of life in the communities we serve."
Not many companies dedicate almost 5 percent of their work force to community programming and philanthropy. Innovative ideas from the Cox family include Kid Classics, a children's alternative to TV brain drain during the summer, in which children are invited to screen films based on classic books and also receive a copy of the book.
Cox, in cooperation with Lakewood's Beck Center for the Arts, gave students the opportunity to listen to talks and learn from persons with disabilities. And Cox employees volunteer at the annual Parmatown Mall Read-A-Thon.
In conjunction with its effort to promote responsible viewing, Cox worked with Cuyahoga Community College to bring a day of seminars and lectures to the campus, including experts discussing the effects on children of television violence. The company also goes on the road, providing Critical Viewing Workshops to local PTAs and civic organization.
Haynes says that as a father, he knows every day is a parenting adventure. And while Cox's initiatives benefit the company through name recognition, he believes its long-standing tradition and marriage with education improve the quality of family life and set the local viewing area apart. How to reach: Cox Communications, (216) 676-8300
Deborah Garofalo (email@example.com) is associate editor of SBN Magazine.
Both had entrepreneurial dreams and were mentored by the president of the Cleveland-based publishing company where they worked.
They left that company in 1952 to form Dix & Eaton, but took with them the sound advice they received from their mentor.
"If a community is good to you, it's your duty to put back into it ...whether it's time, money, expertise or some combination," says Eaton.
Dix & Eaton is the largest employee-owned public relations and investor relations company in the United Sates, with global clients including TRW, PolyOne and Avery Dennison.
Dix retired in 1982 and Eaton in 1999 after seeing the company grow from two to 75 employees. Although the firm doesn't make hiring decisions based on the community activity of potential employees, Eaton says, it is full of caring people. Their activities are the reason the company was honored with a 2001 Pillar Award for Community Service.
Cynthia Schulz, managing director of public relations, says, "Giving is something that's integrated in everyone's role around here."
Schulz is especially pleased with the company's spirit in providing Christmas gifts for more than 50 children who are in foster homes or waiting to be placed in foster homes. Dix & Eaton employees work with the Malley Foundation to get the children's names, ages and wish lists to be sure each one gets something for Christmas.
Schulz says there is a contagious, companywide excitement in caring for children in need. And while many people are generous at the holidays, Sandra Ripepi Stafford says it's more than just a seasonal tradition.
"After working for Dix & Eaton for five years, I've seen how they have quietly given to the community," says Stafford, senior account executive. "Philanthropy is part of the culture."
Dix & Eaton employees sit on more than 30 nonprofit boards throughout the Greater Cleveland area. And that sense of caring reaches into surrounding communities, with staff members working with charities in their hometowns from Lorain County to Lake County.
Companywide support has exceeded $100,000 in non-billable community service, which includes United Way Services of Greater Cleveland. Dix & Eaton also participated in the Greater Cleveland Growth Association and President Council's Boardroom to Boardroom program to link minority entrepreneurs with area business leaders for business strategy counseling.
Other programs include donations to those affected by the Sept. 11th tragedy, the American Red Cross blood drive, Billy Bass Run and the Salvation Army's Adopt a Family program.
Employees of Dix & Eaton serve as counselors or as committee members for groups including Cleveland Heatlhcare for the Homeless, the City Club of Cleveland, Habitat for Humanity, Cleveland Today, Bellflower Center for Abused Children, Rainbow Children's Museum, the TRW Early Learning Center, Notre Dame College of Ohio and the Great Lakes Theater Festival.
Eaton says it has always been company policy to financially support the causes its employees work for. And because the spirit of giving is contagious, it continues to grow within the people that join the company.
Scott Chaikin, chairman and CEO, leads by example through his participation on boards and the support of his staff for individual causes.
"It just feels good to work here," Chaikin says.
Heading into Dix & Eaton's 50th anniversary next year, Eaton is proud of the new leadership in place to carry on the philosophy of care.
"It is an extraordinary source of satisfaction knowing that you're contributing what you have to an organization that can use it," says Eaton. "The award is something they (employees) will treasure, and in my own way, I will, too." How to reach: Dix & Eaton Inc., (216) 241-0405 or www.dix-eaton.com
Deborah Garofalo (firstname.lastname@example.org) is associate editor of SBN Magazine.
No one knows that more than the employees and staff of St. John West Shore Hospital, a 2001 Pillar Award for Community Service winner.
Community can be a place or a feeling. At St. John's, it is a ministry.
"It's always been a part of the history of this hospital and its traditions ... our duty to provide benefit and support to the community," says Fred DeGrandis, president of the Westlake institution.
DeGrandis says his role is not that of a motivator or organizer, but of a facilitator.
"Health care workers come into this profession and ministry because they want to give of themselves," he says. "We, as leaders of the hospital, have an obligation to provide them methods, ways, give them some ideas and listen to ideas they have on how we can help the community in effective ways."
St. John employees have been creative in the development of outreach programs. To help the thousands of people unable to afford health care, the hospital this year created Partners in Ministry, which assists low-income, uninsured people in getting medical care through North Coast Health Ministry and the Lorain County Free Clinic. Hospital employees donate their time and expertise, and St John donates $20 for every hour each employee works.
St. John also participates in Harvest for Hunger and this year raised more than $10,000 through donations, raffles and a fish fry. For its efforts, Harvest for Hunger recognized the hospital as a silver award winner.
DeGrandis sees the hospital's mission as more than meeting people's basic needs. To support that mission, each year 200 artists and more than 55,000 visitors converge on the hospital grounds for an arts festival. Proceeds support programs offered through the hospital's Community Outreach and Wellness Ministry programs.
St. John also uses the festival setting to offer health screenings to those who might not seek medical attention elsewhere; last year, approximately 2,000 people took advantage of the service and those attending donated 6,300 pounds of food.
Many of the programs provided by St. John are new, while several are carryovers from before the merger of St. John and Bay View Hospital.
"The programs that you see are the thoughts of employees, the efforts of leaders, but it's the giving spirit of the folks that live here that make them alive and make them of value to the community," he says.
Community service is an important part of what St. John is and DeGrandis is not shy about accepting the Pillar Award for the hospital. He says its programs will be enhanced by virtue of the recognition and will spread the spirit of giving.
"I think when you put the spotlight on folks that are doing good works, other people want to get near it," he says. "Every one of these programs has the fingerprints and hard work of people dedicated to doing good works. It's beyond the walls of the hospital where I believe the real healing takes place." How to reach: St. John West Shore Hospital, (440) 835-8000
Deborah Garofalo (email@example.com) is associate editor of SBN Magazine.
What's driving the increase in health insurance premiums? That depends on whom you ask.
Some say it's the plunge into more research and development; others blame it on new technology and the high price of the latest equipment. Still others point to an aging population.
But there is a short list of primary drivers to health insurance cost increases that everyone can agree upon, says Scott Lyon, executive director of Group Services Inc., part of the Council of Smaller Enterprises.
Lyon says a recent survey by The Center for Studying Health Systems Change looked at issues contributing to the 2000 increases and offers the top primary and ancillary factors driving up the cost of health insurance:
Prescription drug spending
* 44 percent of the increase in spending in 1999 is attributed to drug spending.
* One-third of that 44 percent is due to higher drug prices; two-thirds is attributed to the introduction of new drugs, lifestyle drugs and pharmaceutical company advertising.
* 32 percent of the increase is attributed to growth in physician spending.
Hospital outpatient spending
* 21 percent of the increase is attributed to hospital outpatient spending.
* Annual per capita increases average 8.5 percent as inpatient admissions for medical procedures decrease.
* New drugs and new technology decrease the need for inpatient stays, but the cost to operate a hospital remains constant.
* Hospital costs are borne by fewer patients.
* New construction strains resources as the number of outreaching ambulatory centers increases.
An aging population
* The aging baby boom generation presents a higher demand for technology and treatment.
* Aging is complicated by obesity, which spawns cardiovascular disease, high blood pressure and high cholesterol.
Insurance carrier profits
* Health insurance companies push for profitability through mergers and acquisitions.
* The number of for-profit insurers exceeds the number of not-for-profit insurers.
HIPPA - The Health Insurance Portability and Accountability Act
* The law guarantees issue and renewal of health insurance in the small-group market.
* It requires that all insurance issuers offering coverage in small-group market accept every small employer that applies.
* Nondiscrimination provisions prohibit health plan or insurance issuers from denying individual eligibility for benefits or charging higher premiums than for a similarly situated individual based on health.
* HIPPA drove changes in rating methodology for commercial insurance carriers.
* Overall, many insurance carriers raised premiums to cover the additional risks associated with HIPPA.
Four years ago, Kent Clapp, chairman and CEO of Medical Mutual, called an old friend, Edward Hartzell, to toss around a few revenue-generating ideas.
Together, they designed Antares Management Solutions, a wholly owned subsidiary of Medical Mutual. Today, that extra revenue is approximately $90 million generated by 700 employees from headquarters in Westlake and processing centers in Beachwood and West Virginia.
Both Hartzell and Clapp have in-depth knowledge of the behind-the-scenes workings of the health insurance industry after rising through the ranks of the Blue Cross Blue Shield family of insurers.
Together they concentrated on expanding Medical Mutual's most valuable function -- service. In 1997, Hartzell became CEO of the new solutions provider.
''We took those skills and competencies and said, 'We can create a business out of this,''' Hartzell says.
Antares' first order of business was to take over systems services for its parent company. It then signed on Central Reserve Life Insurance in Strongsville.
Antares manages disaster plan recovery by running clients' software in its data center, removing the worry of keeping data communications lines up and running. It also offers customized claims adjudication and customer service software. To tie it all together, the solutions provider trains clients in the software or supplies the entire customer service staff.
The concept was to share strengths developed over time with other health care organizations, allowing them to concentrate on core competencies. By understanding the entire gambit of what health care companies do, Antares offers cost savings in operational activities.
Consumers want service from their health insurance provider, but behind that service lies a tangle of typical business demands: e-commerce design and hosting, network security, disaster recovery, telecommunications, capacity planning, HIPPA compliance, software design, programming and training.
''We are actually an extension of that insurance company (client),'' explains Hartzell.
Recognizing exactly what Antares is and is not allows the company to look to the market for the best software systems, even turning to competitors' software to offer more flexibility to its customers. Hartzell says the company is not married to one software system because it is not just selling software -- it is selling solutions.
The company also doesn't let the lure of big dollars entice it from its niche. If a customer does not fit the target demographics of a small- to mid-sized company -- $100 million to $500 million in premiums -- Antares does not pursue it, Hartzell says.
Antares has just 15 clients, but sales per customer can amount to as much as $10 million annually. Most are based outside Ohio to avoid servicing a company in competition with Medical Mutual. How to reach: Antares Management Solutions, (440) 414-2100 or www.AntaresSolutions.com
Deborah Garofalo (firstname.lastname@example.org) is associate editor of SBN Magazine.
The career of Margot James Copeland reaches back to the 1970s when she was a researcher for the Ohio State Legislature. With a master's degree in hand, the Virginia-born businesswoman took root in Northeast Ohio's profit and nonprofit sectors.
With her previous position at Leadership Cleveland and then through the Greater Cleveland Roundtable, Copeland has facilitated Cleveland's renewal. It is because of those roles that she is recognized as a Master Innovator at the 2001 Innovation in Business Conference.
As executive director of Leadership Cleveland, a program of the Greater Cleveland Growth Association for 10 years, Copeland nurtured and cultivated relationships among leaders of the community from the health care, nonprofit, business and religious sectors. Meeting once a month for nine months, groups took field trips, listened to speakers and simply gathered to share ideas on the issues most affecting the city, those issues being racial, social, health care and economic development.
Copeland became president and CEO of the Greater Cleveland Roundtable in 1999 after leaving Leadership Cleveland. She then moved the organization from a champion of racial progress to include proactive programming, tying diversity with bottom line business success.
The organization is made up of a group of leaders that come together to develop strategic action plans to resolve the multiracial and multicultural problems confronting the city.
Mayor Mike White sums up Copeland in one word: Driver.
"She's a person who sets a path, gives it enough thought, then sets her course," he says. "She doesn't let anything get in the way of achieving success."
That's not to say Copeland has an adversarial style; rather, her manner puts people quite at ease. White explains that it takes a great style along with a creative mind to turn dreams into reality.
"Leadership Cleveland is a process organization," she says. "You frame the arena for people of influence to come together, develop relationships in an arena of trust in ways you would not normally be able to do in other settings."
Terence Uhl, executive director of Cleveland Today, says Leadership Cleveland is designed to teach city leaders about the issues. Uhl is a 1999 alumnus and, after 25 years, the network is full of notable names including Mayor Mike White, Mary Boyle, Jane Campbell, Jimmy Dimora, Tim McCormack and the majority of Cleveland's CEOs.
"Leadership Cleveland was really a way for me to blend my volunteer leadership track and my professional track together," says Copeland. "Community really became the heart of what I wanted to do."
Uhl says Copeland has a wonderful mix of perception, intelligence and energy that has people looking to her as a leader.
According to Copeland, teaching leaders about the community and introducing them to a network of their peers helps cultivate relationships that yield success. The forum allows people to shares ideas and agree to disagree, in order to focus on resolving ethnic and racial problems in the communities.
Copeland attended a Leadership Cleveland forum in 1991 when she was president of the Junior League. As she recalls, it had a profound effect on her when she saw the participants working as a collective to initiate change.
Dennis Eckart, president of the Greater Cleveland Growth Association, says Copeland's tenure as director left a lasting impression on him.
"Anyone can do great things one time. Doing something really well, year in and year out, recruiting, motivating, organizing, that's different," he says, adding that "Leadership Cleveland was one of the reasons that Cleveland became a comeback city."
A humble Copeland does not take credit for any of the successes of the program.
"I didn't do it," she says. "I just framed the arena for these relationships to come together."
But the effects are well-documented. From putting a library in the women's correctional facility to playing a key role in attracting major corporations to the city, others will give her much more credit.
Uhl says Copeland had a masterful way of pulling the best out of people while still creating a cohesive group.
"Taking over the Roundtable was a natural progression for her," Uhl says. "The reputation she earned in running Leadership Cleveland was just a tremendous asset for what's now the really difficult job of trying to get the issues of diversity and inclusiveness addressed on a broad scale."
One of her biggest accomplishments is the Greater Cleveland Roundtable Center for Diversity Management and Education, which is a consulting service focusing on diversity management, inclusion and education.
Sandy Holmes, associate director of the National Conference for Community and Justice in Cleveland, worked with Copeland in 1999 on the CommUNITY project. The multimedia marketing campaign focused on diversity issues during a 30-minute television program carried simultaneously on all local channels.
"She can make a point in such a way that people in the room really remember it," says Holmes. "She has a great ability to deliver a message and to make people think about things in a different way than they might have."
Copeland's 1999 initiation into the Roundtable came at the time of the Ku Klux Klan rally that had city leaders hotly debating what to do. Joining forces with city officials, Copeland encouraged the community to consider the rally a non-event.
Copeland's goal for the Roundtable is to create an organization that the community can utilize that makes inclusion an integral part of business success.
Barry Doggett, deputy director of Cleveland Tomorrow, says Copeland recognizes that the needs of the community have changed and she brings that to the Roundtable. White adds her work with the police and fire departments in dealing with race and gender issues has been immeasurably helpful.
Confidentiality prohibits Copeland from discussing the programs' specifics except that each program is customized to fit the organizations' needs rather than a cookie-cutter approach.
White acknowledges that "Cleveland's business community will never be a world-class business community unless it clearly embraces diversity."
Cleveland is still in its comeback stage.
"I don't feel that Cleveland can honestly say that it has come back as a community until we climb this last slippery slope," says Copeland. "This is the issue of inclusion, this is the issue of participation."
Acceptance and inclusion are key to working out the problems of race and community.
"If you can basically enlighten the sense, enlighten people though processes as they go about doing their work, you can help them get beyond fear," Copeland says. "People are afraid of what they don't know."
How to reach: The Greater Cleveland Roundtable, (216) 579-9980; Leadership Cleveland, (216) 621-3300
Earlier this year, Paul Feingold succeeded Arnold Tew to become the 16th president of Myers University. But it was Feingold's work as Myers' academic vice president that earned him his current job and garnered his recognition as a Visionary in the 2001 Innovation in Business awards.
Institutions of higher education can teach students or change lives. Feingold opts for the latter. He understands the community Myers serves and uses that knowledge to redefine the school's market focus and create key niche programs.
The results are impressive -- approximately 1,400 enrolled students, a staff of 100 and annual revenue of more than $10 million at a university founded as Folsom Business College in 1848 to help Cleveland gain full-city status.
Feingold did not end up in Cleveland due to the hijacking of his plane, nor did he accidentally get lost in the maze of barrel-lined Ohio roadways. The business professor from California came to the Lake Erie shores with a clear purpose -- betterment of the school and the community.
As an administrator in California, he employed creativity with graduate programs but sought an opportunity to do the same with undergraduate studies.
"I've always looked at problems not as problems but as challenges," Feingold says, adding that he is simply looking to accomplish change.
In the early 1990s, Myers was seeking a strong identity. Because Feingold dropped out of college, eventually finishing his undergraduate degree by going to school during the day and working at night, he brought an unique perspective to his academic vice president position. By analyzing his own life as a father, husband, part-time student and employee, he folded innovative programs into the traditional business school.
"I know the problems," Feingold says. "Where do my innovations come from? The school of hard knocks. We've provided opportunities for people to go to school. The business world benefits because they have a better educated work force."
With satellite facilities into six suburban Academic Centers, students can attend Myers in the communities where they live and work. Feingold's commitment to that all-important balance between personal and professional lives led him to develop diverse learning methods -- Myers is the first Ohio institution to offer degrees online for both undergraduate and MBA programs.
Knowing that time constraints, business experience and career aspirations drive and differentiate the adult student, Feingold designed a 30-credit-hour, one-year MBA program. And, understanding that teachers in an urban setting have classroom problems not seen in rural communities, he set his sights on education programs specifically designed for the urban educator. He says the next step is "to prepare teachers who have experience in urban issues and teach the kids how to cope and overcome."
As corporate colleges become the norm for extended training and degree-seeking employees, Myers University Corporate College Partnership program is gaining quick acceptance within Cleveland's corporate community. Businesses utilize its online capabilities and faculty to offer accredited degrees, as well as noncredit certificates in areas that can have an immediate impact on job skills.
Feingold says his message to the business community is simple and straightforward: "Stop talking about the problems and let's start solving them," he says. "Let's take some chances and move ahead."
How to reach: Myers University, (216) 696-9000
Some business owners may view selling their product through a major retailer such as Office Depot as the epitome of success, but not Jim Kandrac, president of Altatech-Direct.com.
When Kandrac founded the furniture manufacturing and supplies company, he looked past the prestige of big-box retailers to cyberspace, taking the road often deserted these days.
The move paid off -- Altatech has achieved $6.5 million in annual sales while its Internet cousins continue to drop by the wayside. It's done so by responding to the market and understanding its core strengths.
Laying the foundation
In 1987, Kandrac left a Cleveland-based computer leasing company to start a computer hardware business, United Computer Group. Around 1996, hardware became a commodity product as prices dropped and access to equipment increased.
Sensing the shift, Kandrac turned his attention to other ways for UCG to provide value to its customer base of small- to mid-sized manufacturing and distribution companies.
He saw a need for systems packages, such as manufacturing distribution systems, customer relationship management, business intelligence enterprise solutions and Web-enablement programs. The market proved him right. Over the last 14 years, UCG has evolved into a solutions-driven complete systems provider, with 20 employees juggling more than 500 accounts.
A favor yields a company
Initiating a computer furniture business in 1996 was a whim, an afterthought.
"Some of our larger customers had asked for better quality computer furniture. ... There were a lot of press board (products) ... so I started looking at it," Kandrac says.
At first, products were imported from Europe for resale. This was around the time that the number of office superstores was exploding -- Furniture Max stores were opening next to their sister division, Office Max, and Office Depot was starting a furniture retail chain in major cities nationwide.
What started as a favor for key clients developed into a business as Altatech captured superstore sales in the United States. Its Web site was originally viewed as a customer convenience rather than a market strategy, but when Kandrac saw how the middleman pulled profits out and kept Kandrac's profit margins low, he sought other opportunities.
The big one arrived when a manufacturer in Mexico approached him. Kandrac saw a strategic advantage. That relationship opened the door to selling the product in Mexican superstore chains and drastically decreased supply costs.
Leaving the bricks and mortar
After two-and-a-half years, Kandrac rewrote his American business plan to reflect a new strategy -- go direct via the Internet. An analysis revealed that even the manufacturing partnership could not eliminate the drain on revenue.
From co-op advertising, product returns and questionable risk factor percentages, Kandrac says there was no way for Altatech -- or any company -- to be truly competitive with its products in U.S.-based big-box retailers.
Kandrac recalls saying, "Wait a minute, wake up here. Let's apply what we do on daily basis for our clients (of UCG)." He decided to pull out of commercial retail and move solely into the Internet arena.
Altatech has grown 300 percent since then, proving that understanding the market and capitalizing on change are still business standards to live by.
"By us coming to that decision and going direct, we have more control over our business, and our profit margins are triple," Kandrac says. "We do less sales overall, but they're much more profitable."
UCG funded the business model that includes container-load shipments from the manufacturer Mexico to an Ohio-based warehouse for national distribution.
Surviving the Great Shakeout
Altatech not only survived 2000, it flourished while competitors and other Internet retailers did not. How?
By tapping into the global marketplace. Altatech's sales are processed through a Web-enabled order entry program and soon-to-be-online live interactive order confirmation system. International sales originate from Brazil, Chile and Argentina. Those countries, as well as Russia, Spain, Taiwan, Germany, Italy and France, are targets for future corporate partnerships. Kandrac expects to have selected international partners established by the end of 2001
Back home, the American market revealed growth in the expansion of training and call centers, so Altatech targets multisite national and international customers that include the U.S. Marine Corps.
Kandrac believes diversification with global sales takes some of the risk out of the fluctuating local economy.
"I know long term we don't want to be completely dependent upon our marketplace," he says.
Kandrac admits challenges lie ahead. From finding low-cost packaging for long distance shipments to establishing safe financial transactions methods, expansion into the global market holds risks. But, he says, "If it were easy to do, everybody would be doing it." How to reach: Altatech-Direct.com, (440) 717-7655
''I do my e-mails and start making client calls at 8,'' she says. ''Between 8 and 5:30, whether I'm reactive or proactive depends upon what my customers want me to do that day.''
Golenberke has been working in a virtual office since 1994, long before it was considered a viable option. Today, Internet experts estimate that thousands of Northeast Ohio employees take advantage of the virtual option. The home office offers flexibility and convenience to workers and cost savings and increased productivity to businesses.
However, not every employee thrives away from the structure of the office, and not every business is equipped to have employees outside the corporate comfort zone.
Who's jumping on the virtual bandwagon?
As a sales representative for Smartforce, a learning management corporation, Golenberke works with clients on Internet-based instruction modules. She is one of Smartforce's 1,500 employees who choose a desk at home over an executive suite.
''When I first started (in the virtual setting), I would actually take a shower and get all dressed up, even if I didn't have any appointments. ... I felt like I had to do that,'' says Golenberke.
She admits now that schedule only lasted about six months.
Thanks to advancements in telecommunications, Golenberke's customers never know if she is in her pajamas or at an office as they discuss platform content for training.
Barney Dougher, president of Advance Lens Lab in Berea, is a wholesale manufacturer of custom-ground prescription eye lenses. Of his 55 employees, three work from home offices. Covering a five-state market, three virtual sales representatives work with clients in outlying areas.
''It's not just a cost savings,'' Dougher says. ''I think it is also the reality of having them closer to their own market place.''
Brian Moser, managing consultant at Microsoft Consulting Services, worked from his Huron home but now works from a newly opened office in Independence.
''First and foremost, it (working at home) saved the trouble of driving to Cleveland,'' says Moser.
Even older, well-established companies are jumping on the bandwagon. Reynold Bookman, president of Forest Corp., employs half of his sales force for the national printer and manufacturer in virtual offices.
''We made a decision to hire people out in the territory mainly from a cost standpoint,'' says Bookman. ''No. 1, they'd be out in the territory all the time, and No. 2, they wouldn't have to travel back and forth from the home office.''
Taking the virtual company one step further
When John Stubbs started his company in 1999, he took advantage of the future of virtual offices. The Clevelander established Mac Productions, an Internet solutions provider focused on small- and medium-sized businesses. Its services include online customer service, check acceptance, credit card processing and Web design and Web hosting.
Stubbs started his company with virtual employees, and much of its infrastructure utilizes virtual services such as online customer billing, human resources, recruiting, customer relationship management programs, payroll processing and even postage purchases.
Stubbs also took advantage of online recruiting. His developers are Web recruits from across the United States. Sales reps are called V-reps, or virtual reps, and their primary contact with Stubbs is via the Web.
''We completely utilize the Internet to its fullest potential, whereby we can keep our operating costs as low as possible in comparison to our competition,'' says Stubbs. ''We are a virtual company.''
Not for everyone
But a total virtual work situation is not without its own set of unique problems. Moser says that while Microsoft provides great software for communication and videoconferencing , his hometown has not caught up with the necessary bandwidth.
''We have the technology, but the basic infrastructure at the telecom level is not in place,'' laments Moser.
Another pitfall is the lack of interaction with other creative people.
''You're not getting other vantage points. That one was a big one for me because I have a really intelligent team,'' he says.
When Moser moved into the Independence office last year, he noticed another benefit at the end of the day: ''I turn it off a little bit more,'' he says.
While working at home allows for the effective use of time and the elimination of commutes, some employees find themselves working evenings and weekends.
''It's because it's there,'' says Moser. ''It's calling you.''
Golenberke finds herself in the same situation.
''I've not always been real good at trying to keep balance in my life because the work definitely overshadows the personal life,'' she says. ''I don't know what 5 o'clock on Friday means; I've totally lost what that means.''
Like the offices of many virtual employees, Golenberke's is always set up and the computer is always running.
''I'll walk by my office and I'll check my e-mail and then I'll remember I forgot to put something together. You know, 15 minutes here, 20 minutes there, sometimes hours,'' says Golenberke.
Culture is still important
Creating a culture and maintaining the right attitude is the biggest problem Bookman says he encounters with his virtual salespeople. They feel like they are not part of the organization, not serviced, helped or appreciated like their counterparts working within the headquarters.
''To a degree, it is simply because they're not here. ... Communication is not as quick, efficient or as easy,'' says Bookman. ''They tend to miss out on a lot of innuendo, interactions, discussions, problems and solutions.''
With that understanding, Bookman is not considering having other departments becoming virtual, even with the promise of savings on overhead.
Moser says another drawback is that virtual employees are held to a higher standard because they are truly their own bosses.
''There is an expectation that if you're in the office, you must be doing work,'' he says. ''When you work from home, you have to achieve a different level of effectiveness to make sure that you're constantly showing the value of you working at home. It's more of a perception issue.''
Golenberke feels the same pressure to perform, but the pressure is more self-inflicted.
''Do I have to work as many hours as I do? No, but I don't think I'm getting a raw deal. ... I'm the one determining whether or not I'm going to kill myself and work until 2 o'clock in the morning,'' she says.
Once the decision is made to incorporate virtual offices, the question becomes: How does the business leader know who will be the self-motivated employee and who will be napping at noon?
William Hite, founder and president of W.A. Hite International Inc., a Cleveland-based executive search, outplacement and career counseling firm, says people with a history of achievement in outside sales usually possess the self-management skills necessary to work in a virtual office.
Self-discipline is best demonstrated by success, he says.
''Successful people are people who gained the habit of doing the things that failures don't like to do,'' he says.
Moser says employers and employees alike will be more successful in a virtual setting if expectations are clarified going in to the arrangement.
''Assume at least your current workload, if not more, depending on how you drive yourself,'' he adds.
He suggests getting face-to-face with people within your organization as often as possible. Interacting and sharing ideas on a regular basis ensures you're considering every aspect. It is especially important to keep your manager informed of the goals. With virtual employees, that responsibility usually falls on their shoulders.
Moser also recommends making sure your virtual office has a door. It will not only block off noise from the rest of the household, but ''at the end of the day, you can close the door and walk away from your business. I think that's important.''
How to reach: W.A. Hite International Inc., (440) 461-1600