Dustin S. Klein
(Downs) to Ohio. The state ranks 32nd in terms of the percentage of workers who ply their trade in high-tech jobs. A scant 3.85 percent fall into the high-tech category, compared with states like Maryland, where nearly 8 percent of all jobs are in the high-tech sector.
(Ups) to the regional businesses that chipped in and helped the Summit County United Way raise $13.02 million in 2002, up 3.5 percent over 2001. Although the group fell short of its $13.6 million goal, the United Way ran first-time campaigns at 56 new organizations and garnered 1,500 new donors. The average donation rose from $210 last year to $234 this year -- an 11 percent increase.
A repair shop replaced the dead battery, but then we discovered the alternator wasn't working up to snuff. It wasn't bad, but the mechanic noticed fluctuations in the alternator's energy wave when he put in a new battery. Having the repair shop replace it, when neither they nor we were sure it had to be replaced, would have been expensive, so Bob suggested we give it a whirl.
We purchased an alternator, then set out to install it. Predictably, we failed. But not because we didn't possess the skills to accomplish the job; in fact, everything almost went smoothly. We failed because the replacement part didn't quite fit into the rigid casing in the engine body, and we lacked the proper tools to get the job done.
In business, the same tenet holds true. Great leaders may understand exactly how to lead their companies successfully, but if they don't have the right tools in place to help them accomplish their goals, they're doomed to fail.
Sometimes the missing tool is people. If your company doesn't have the right people in the right jobs, your personnel resources are misplaced. Other times, the tool that's lacking is technology. If your sales department can't electronically talk to the accounting department or warehouse, it's difficult, if not impossible, to determine whether you have a specific product available or if your customers are up-to-date in their billings.
You can have all the smart ideas in the world and be the best paper technician ever, but it is only how you're able to put those ideas into practice that truly matters when the green light is on.
In my case, Bob called a friend who owned a repair shop and agreed to install the part at a low cost. His friend had the tools to make the part fit and succeeded with little effort. If you have the right tools in place, you can too.
Winds of change
You may have noticed that Connie Swenson no longer appears as editor of SBN Akron/Canton. That's because in December, she was promoted to editor of SBN Online (www.sbnonline.com).
In her new role, she is responsible for managing the content for SBN Online's three city Web sites -- Cleveland, Columbus and Pittsburgh. In her stead, SBN Executive Editor Dustin S. Klein will oversee SBN Akron/Canton.
The author of November's cover story was misidentified. The writer's name is Victoria Reynolds.
(Downs) to negative ad campaigns. Maybe it's just me, but it seemed as though this year's crop of political ads were especially negative. As backlash, many voters -- me included -- voted against the purveyors of negative ads, even when we preferred those candidates rather than their opponents.
(Ups) to Viztec Inc. The Twinsburg-based developer of flexible LCD technology recently received approval for its patent of the Chip Card Rebate System, which covers electronic cash rebates loaded onto smart cards. It will help the fledgling firm continue its movement into a highly lucrative market.
UPS to PNC's decision to set up an ethics hotline for employees to report possible misconduct to its corporate ethics office and board of directors.
DOWNS to the shutdown of Hours To You, a grocery delivery service that showed promise when times were good but lost its appeal when the economy took a downturn.
UPS to mounting charges against the managers of cable TV giant Adelphia Communications Corp. The corporation's crooks will pay, we hope, but what about the penalties paid by shareholders, employees and customers?
DOWNS to the shutdown of the Family Toy 15-store chain. Christmas just couldn't come fast enough for the 80-year-old company, a victim of a sluggish economy in the short term and an onslaught of big box retailers over the long haul.
UPS to the reopening of the long-time Pittsburgh favorite Colony Restaurant after it was closed for more than a year for renovations.
UPS to a $240 million deal that will bring sorely need cash to US Airways in exchange for a 37.5 percent share in the company for Retirement Systems of Alabama.
UPS to Highmark's selection of Ken Melani as CEO to succeed John Brouse, who will retire at the end of the year. The affable physician should prove a calming force on the region's sometimes turbulent and contentious health care scene.
UPS to some good news out of Marconi. The company has landed the first sale of its most advanced computer networking switching equipment, a technology developed at the company's Pittsburgh operations, to the U.S. Defense Department.
The 62-year-old Pham was not part of some reality TV show-inspired endeavor for personal glory and fame. Rather, he had embarked on an innocuous 22-mile trip from Long Beach, Calif., to Catalina Island when a storm blew in, broke the boat's mast and damaged its motor and radio.
Helpless and disoriented, Pham drifted out to sea. He eventually reached the waters off the coast of Costa Rica, where the U.S. Navy happened upon him.
Pham could have easily died; the odds were against him. Instead, he used the meager tools at his disposal -- wood paneling from the boat and a five-gallon bucket -- to catch and roast sea birds and collect rainwater.
The situation bears resemblance to that of many beleaguered business leaders stranded in rough economic waters. Instead of sharks, wind and inclement weather, they face a taut credit system, volatile stock market and mounting losses, with no lifeline.
Like Pham, in order to survive long enough for their luck to turn, they need to use the tools they have available -- cash reserves, stable customer bases, able employees and strong supplier relationships.
True survival skills aren't taught in business school; they are learned only through experience. And because of the strong '90s economy, many younger CEOs and presidents have little real-life crisis experience to draw from. The bitter prospects of bankruptcy, takeovers and shuttering companies are tough pills for them to swallow.
There are those who panic in such situations and others who remain calm. Both may employ similar measures. But only those who reduce expenses such as salaries, marketing budgets and capital expenditures without cutting off their company's ability to enhance and service existing business or bring in new customers will weather the storm.
Only Pham knows whether he panicked as he sat alone, night after night, wondering if he would ever reach land alive. We do know that he never gave up, and that his survival skills were put to the test.
His ability to use what was available and live to tell about it is a lesson any business leader can learn from.
Dimoff retired from the force on disability after being injured on the job, but security never left his blood. The Akron native then spent close to a year researching why U.S. corporations typically lose employee-related lawsuits and determined there were five areas being neglected by business owners when dealing with their employees -- the hiring process, training for supervisors, development of foundation policies (employee manuals and drug testing), security-related matters and consistency of implementing the four across all shifts and locations.
This information became the nucleus for Dimoff's firm, SACS Consulting.
Ten years later, he has built a reputation not only as a security and training expert in employee-related matters, but also as an entrepreneur willing to invest time, money and energy in emerging regional businesses.
Active in organizations including COSE and the Greater Akron Regional Chamber of Commerce (Dimoff is chairman for the chamber's Small Business Council), he serves on the University of Akron's Community and Technical College Advisory Board as well as on Witness Justice, a Washington, D.C.-based advisory board that works with victims of crimes.
Part of Dimoff's passion is to stave off regional brain drain by bridging the gap between education facilities and the local business community. He regularly brokers meetings with university executives and regional business leaders. And he has put his own money to the test by investing in several local start-up ventures.
When he's not busy helping facilitate Northeast Ohio business, Dimoff coaches youth sports such as soccer, basketball and baseball.
Since Sept. 11, business security has moved to the forefront of issues that affect employers. SBN sat down with Dimoff to discuss security measures and other pre-employment steps owners can take to protect themselves, their employees and their companies.
Why is security such a big issue?
Because of Sept. 11. It’s caused us to reexamine everything that goes on around us. We now have no choice but to be aware of the security around us. Simply put, we expect it to be better.
So what can businesses do to reduce their risk exposure?
It’s a lot of simple things. People aren’t using things they already have. For example, they have access control but allow everybody and anybody to come into their business. They may have cameras, but don’t upgrade them or use them. These are very simple things. Many companies can do simple procedures with employees, vendors and visitors that are cost effective. It usually comes down to using what you have and upgrading a little.
More important is developing procedures for security and actually using them. Many companies have them in place, but don’t. Consider piggybacking. That’s where an employee has an access control card. They swipe the card, and the next 20 people behind that person don’t swipe their cards. The first person just holds the door open until the entire group is in.
If the purpose of access control is to keep a record of each person who enters the building, piggybacking prevents that. It lets in visitors, vendors and other people who potentially could be criminals coming in while employees are pouring in. Someone who is a threat could stand back and watch this, then penetrate that first level of security.
What about drug testing? There are many changes going on in drug testing procedures. Where’s it heading?
It’s another tool to help better select applicants. Statistically, people who are using drugs tend to have to resort to criminal actions to support their habits. Their judgment can be suspect and their safety questionable. It trickles down to causing trouble in the company and costing it money. We know that potentially anybody utilizing drugs in the workplace have a 40 times higher rate of injuring another worker. When you start using a higher rate of medical benefits or down time, it translates into millions of dollars. That’s why it’s important to include drug testing in any hiring process.
But hiring isn’t an exact science, so how can you improve upon it?
When companies are hurting for money, one of the first areas they cut back on is the hiring process. That’s the last place they should be cutting back. That hurts their ability to screen applicants. The hiring process is the key to the rest of your company, so it’s a bad idea to cut back there first. Beyond that, most companies don’t have a strong hiring process it can be a sloppy process. If it becomes sloppy, it’s more difficult to correct a problem after the hire than during the process.
Is there one issue looming out there that will become the next big issue companies will have to face?
The employee-on-employee altercation issue. People aren’t getting along as well as they used to and there’s been a breakdown in cooperation and working together. We’ve already seen the start of it, and it’s heading in the wrong direction.
How to reach: SACS Consulting, (330) 255-1101
One of my staff members calls me the "Eternal Optimist," because no matter how dire the situation, I'm always convinced we will devise a positive solution.
I prefer to think of my stance as an unwavering belief that if you face adversity with a level head, you're apt to overcome it and achieve success.
If you've never faced adversity, you've yet to be challenged in your business career. You may not even know whether you are adept at creating calm, well-thought-out solutions to the business catastrophes that pop up when you least expect them.
I mention this because September marks the fourth annual Innovation in Business Conference. While not necessarily designed to honor overcoming adversity, the conference and awards program was developed to underscore the power of innovative thinking in the business world.
When we founded the program in 1999 with Anthem, our goal was to bring the pages of our magazine to life and honor those companies and decision-makers who understand how to tackle tough situations and devise creative solutions in order to forge ahead -- no matter the economy.
As I read through this year's entries, I was struck by the enormous amount of innovative activity in this region. Not only did the quality (and quantity) of nominations we received this year leave me smiling, I was also surprised by the burgeoning entrepreneurial activity across Northeast Ohio. Needless to say, I'm optimistic about what the future holds for emerging business in this region.
Recently, the bulk of the news being reported hasn't left a positive impression about business. But this is an inaccurate picture of what's really happening. The reality is that Northeast Ohio is loaded with interesting firms engaged in a multitude of activities, including more software developers than I ever imagined.
It is with this in mind that I encourage you to read the profiles of this year's honorees and finalists in this issue. I'm sure after you're finished, you'll agree the region really is bursting with smart ideas ... and hope.
By John Ettorre and Dustin S. Klein
Virtual tax questions
Information technology, marketing and accounting are important concerns of clients who have signed up for Ernst & Young LLP's new virtual consulting service, but tax questions topped them all.
According to a recent survey of 3,700 questions from subscribers to Ernie, the accounting and consulting firm's online consulting service, issues related to taxes topped the list of inquiries to the Internet-based system, with 24 percent of questions devoted to that topic. Trailing behind with 21 percent were questions related to human resources, accounting (13 percent), information technology (10 percent) and market research (7 percent).
Northeast Ohio's manufacturing prowess is on the rise, but it's not due to a sudden surge in manufacturing employment-which is up about 2.7 percent over the past three years. Instead, it's due to the region's tidy contribution to the manufacturing portion of the U.S. GDP.
According to a study by Cleveland State University and Industry Week magazine, Cleveland ranks 28th out of the nation's 315 total metropolitan statistical areas-up 57 spots from last year-with $55,086 of product per worker. Akron ranks 60th and Canton weighs in at 66th. When you toss in the Youngstown-Warren area-which ranks 12th overall-the Northeast Ohio manufacturing corridor accounts for nearly 2.5 percent of the nation's manufacturing GDP-placing it among the nation's leaders.
What's driving the industry? A strong base comprising old-style manufacturing-steel, plastics and automotive products-and modern, cost-efficient facilities. Who says Silicon Valley has anything on the Erie shores?
Ups and Downs
Up... to Fix-Corp. CEO Mark Fixler for giving up $14 million in stock options in the company he founded. Fixler says it wouldn't be fair to stockholders-now paying about $4 a share-if he gained that much from the company's fast growth. Some might call it foolish; we call it leadership.
Down... and outs to the Figgie family name. The once high-flying, then dying and now smaller-but-wiser Figgie International will henceforth be known as Scott Technologies Inc.-a final salute of sorts to the founding family's unceremonious (and deserved) ouster.
Up.... to Hudson's Little Tikes Co., for its new partnership with IBM to build fully functional PC centers for tots. The Young Explorers system will be marketed to schools and libraries-eventually paving the way, we fear, for brightly colored plastic cubicles in the office.
Up... to the Westside Industrial Retention & Expansion Network for its Machine Trades Sectoral Initiative-a bunch of 25-cent words to describe basic training for the unemployed and advanced training for workers who want better jobs. It's the kind of program that should help keep Ohio tops in manufacturing.
Up... to Cleveland artist Thomas Saloman, a sports collage artist whose work will be featured this summer at the Major League Baseball Hall of Fame in Cooperstown. In this case, maybe the big-money contract comes after the Hall of Fame induction.
How did this giant employer reduce costs and injuries? By putting job applicants through physical testing before hiring them as baggage handlers.
It's the latest weapon in the battle against lost-time injuries and workers' comp costs, and you don't need to own one of the largest airlines in the free world to use it.
While the idea is simplicity itself, the technique is only starting to become common practice-primarily because of technology. Until recently, it's been impossible to test a person's physical ability to do a job without exposing the person to the actual stresses of the work-thus risking liability before you've even hired the person.
But that's changing, in part through the work of Cleveland-based NaviSource, a year-old risk-management firm.
In a recent visit, Dr. Tom Gilliam, NaviSource director of physical assessment technology, strapped one of our writers into the company's patented Physical Assessment Technology system, which is designed to test an individual's physical capabilities without risk of injury or strain.
"With new hires, this significantly reduces soft-tissue injuries. As a result, associated costs such as medical and loss of productivity are reduced as well," Gilliam says.
The process, he maintains, is similar to evaluating the word processing skills of a prospective clerk or mathematical skills of a bookkeeper. The only difference is that the P.A.T. system measures physical aptitude. "If you want to hire someone to load an aircraft, you want to make sure they're physically able to do the work," Gilliam says.
While pre-employment physical testing procedures may differ from one test to another, they all average about $100 per prospective employee. Results are typically returned to employers within 24 hours, complete with a U.S. Department of Labor physical activities level rating. That rating is accepted under the American With Disabilities Act, meaning that a failed physical assessment is a legal ground to reject an individual's job application.
Gilliam is quick to point out that pre-employment physical testing can't completely eliminate the risk of injury; the only way to do that is eliminate physical activity, he says. However, by documenting the physical demands of a job and then testing prospects before making a hire, business owners can reduce the risk of injury to their workers.
My physical assessment
When Jeff Coffman, a certified strength and conditioning specialist, strapped me into a Physical Assessment Technology machine at the PT Center for Sports Medicine and Family Physical Therapy, I had two questions: Will it hurt, and will it reveal to Coffman what I already knew about my body?
"We're going to work on your knees first, then your shoulders," Coffman explained. After that, they would test my trunk strength-the back and midsection.
NaviSource's P.A.T. equipment looks like the workout gear at a well-equipped gym. But it's connected to a computer terminal and there is no visible source of weight. Tom Gilliam, director of P.A.T. for NaviSource, says the system uses isokinetic energy. Simply put, the faster and harder you push or pull, the more resistance the machine offers.
The pre-employment physical assessment test focuses on three major muscle groups to determine if a prospective worker can safely perform the essential functions of a job. It can also be used to ascertain whether an injured worker is ready to return to the job.
Coffman punched several buttons on the computer, then told me to lift my leg back and forth to let the computer calibrate to my knee's full range of motion. At this point, there wasn't much resistance.
For the first test, Coffman instructed me to drive my foot up and down by bending the knee. I did it five times fast, as hard as I could. There was no pain, just strain in my muscles.
"The machine accommodates strengths and weaknesses," Gilliam says. "It's 100 percent safe."
The test didn't determine that I'd hurt the knee in a bad skiing accident 10 years ago; it just revealed that the left knee was significantly weaker than the right.
The shoulder test was conducted on a flat bench connected to a rotating bar. The test consisted of lifting the bar from a prone position to just past 90 degrees, then pulling it down to the original position. In that same ski accident I'd hurt my left shoulder, and I was interested to see how much strength I'd really lost. According to the test, there wasn't much difference between the two shoulders.
The final test was on my trunk. I was strapped at the ankles, knees and chest, in a standing position, and told to bend at the waist as fast and hard as I could.
"Explode down," Coffman coached. "Then pull up with everything you've got."
I stormed through two sets of five "explosions," like an on-the-cusp football prospect at the pre-draft workouts. I was out of breath and light-headed from the intense but surprisingly pain-free exertion.
After 45 minutes of testing, the results were electronically entered into the computer, which was programmed to compare my results against a preset baseline.
When my results arrived at SBN headquarters, they indicated I was fit to perform heavy labor, as rated by the U.S. Department of Labor.
It seemed unfair; a recent back injury that had prevented me from even swinging a golf club hadn't been enough to relieve me of the metaphorical heavy lifting of my white-collar desk job.
But a closer look at the definitions showed the truth: The definition of heavy labor was occasional exertion of up to 100 pounds, frequent exertion at 50 pounds, and continuous force in excess of 20 pounds.
The test, in fact, did a better job at revealing my physical limitations than the government does in describing them, and confirmed my suspicion: The only physical labor I'm really cut out for is rapping my fingers on a computer keyboard and lugging my laptop around town.
So guess what. I've been promoted to associate editor.
-Dustin S. Klein
How to reach: NaviSource P.A.T. (800) 249-6431
He tried to convince himself that it wasn't really a problem, since the company manufactures plumbing hand tools-products that are anything but high-tech.
But he knew better. His customers, primarily big-box hardware retailers such as Home Depot, Lowe's and Builder's Square, wanted to exchange business documents electronically. They wanted to send orders and receive confirmation in real time by modem. If Superior Tool didn't figure out how to do so, some other company certainly would.
As vice president of operations, Mintz undertook the job. He knew all along it would alter the interactions between Superior Tool and its customers.
He never guessed how it would fundamentally alter company operations.
The simplest short-term solution-and it was tempting because it would have satisfied the customers with minimal internal change-would have been to download purchase orders, print them out and re-enter them into the computer in the company's database.
That raised a staffing issue, Mintz says. With only one employee dedicated to processing orders, the company (with more than $10 million in sales last year) could handle about 50 orders a day.
But Superior's customers don't place orders according to a regular schedule; the company often receives 120 orders one day and 20 the next. If those orders are being accepted electronically, the customers would necessarily expect fast, if not immediate, confirmation.
"We'd have been holding up our ability to respond to the peaks and valleys of the business," Mintz says. "We would have needed more clerical people than we have now and probably would have provided poorer service. Every time you have to take something and re-enter it, there's more chance for error."
That reality led to some bigger thinking. "We ended up organizing internally around the need instead of looking at it as an add-on," Mintz says. "We decided to run the company more technologically."
The company upgraded its computers from primarily accounting and office functions to a software-based system that touches every aspect of daily operations, from inventory management to the all-important electronic data interchange (EDI) that customers were demanding.
The move required Superior's employees to upgrade their computer skills, a side effect that Mintz says also improved overall productivity.
Today, customer orders flow in through the computer network and are downloaded into the local network each morning. There, they are filed into a customer database.
Each database file is opened and the orders are checked against warehoused inventory. If the products are immediately available, a packing list is printed out and sent to the warehouse for fulfillment.
In the warehouse, a bar code is automatically printed, and then scanned to create shipping documentation. At the end of the day, the data is sent back to the database, which creates and sends an electronic invoice back to the customers.
Mintz says the system has improved the way Superior does business. It cost more than $50,000 and took 3 months to be fully operational, but the results have been all positive.
"It's extended our service capability," he says. "Now, when a call comes in we can not only tell them if we shipped it, but who got it, what it weighed and when. We can give them a little more service than before."
And that has made Superior Tool feel truly superior.