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Honoring the best Featured

9:55am EDT July 22, 2002

Every year, Ernst & Young LLP recognizes those individuals who best embody the spirit and practice of the entrepreneur. And every year, the judges come away shaking their heads in amazement at the extraordinary stories the business owners tell.

But surmounting enormous obstacles or starting on a shoestring aren’t the only criteria for recognition. The judges, according to Ed T. Eliopolous, director of the EOY program and a partner at Ernst & Young, look for so much more. Below, Eliopolous gives his insight into the judging process.

“I think what is most significant about the Entrepreneur of the Year relative to other business award programs is the judging process,” he says. “Here, what we like to do is get a panel of judges that consists of business leaders and civic leaders. We have really tried to stay away from, I think, making it any kind of political statement or any kind of academic statement.

“I really want it to be an award about entrepreneurial spirit and entrepreneurs and focus on business leaders and civic leaders to make those determinations.”

This is the 12th year for the program in Cleveland. Nationally, it began in 1986 in Minneapolis. It’s now in 47 sites across the country and has expanded to 31 countries.

“It was a great idea,” Eliopolous says. “It’s sort of one of those best practices that really works.”

Not all business owners are created equal.

“At birth,” Eliopolous says, “they all have common entrepreneurial traits, but at some point, one may grow at a much faster rate. One may get to levels that will be unseen by the others.

“At the birth of a company, there’s a tremendous amount of entrepreneurial spirit. There’s a difference, though, how far the entrepreneur takes things. These success entrepreneurs, they are viewing the growth of their company as very important, and it’s not for their own personal benefit. It’s not for their own personal wealth and fame. It’s for the benefit of the company, and in many cases, for the benefit of the employees.”

And the process through which those entrepreneurs get to their goals is what the judges look at.

“What’s neat about our judging process or different about our judging process, it’s really a qualitative process. It’s not a simple matrix — did you grow by 50 percent and did you add 50 percent employees over the last three years. It’s much more detailed than that.

“We really want to understand the spirit of the entrepreneur. Where the company has come from, where its roots were, where it’s headed. And I think the judges have historically placed a lot of emphasis on what was at risk. What did the entrepreneur risk? And how well did they persevere. It’s not a flash in the pan, just started and things look good for one year, two years and therefore you’re a winner,” Eliopolous says.

“They’re looking for a trend and it’s a long-term trend. In the past, judges have focused on companies where the entrepreneur treats the employees like family, reinvests in the business and shares the wealth.”

John Haag, owner of SGS Tool, a winner from the 1998 class, is one example of the attitude many winners exhibit. He doesn’t refer to his employees as employees.

“Everyone is an associate,” Haag says. “You’re not allowed to use the word employees. It may just be rhetoric, but I think you do act and you treat people differently based on labels you put on them.”

Another example is former winner Sam Minoff of Kichler Lighting.

“Sam is a wonderful person. He treats everyone with some dignity and respect,” Eliopolous says. “And that includes all of his employees, all of his suppliers and everyone that his company comes in contact with. Sam believes that the employees are nothing but an extension of your family and that your place of business is an extension of your home, and that you should treat it that way. He believes that it’s your duty to reinvest in the business, which is pretty remarkable today.”

Success is only one of many criteria the judges consider. One part of what makes an entrepreneur is the ultimate goal. With his response to one of the common questions judges ask, one finalist basically eliminated himself from competition. The question: Where do you see yourself in five years?

“And the entrepreneur said: ‘Well, I don’t know how long it’ll take. I hope it will take less than five years, but I see myself on the beach, sitting in a lounge chair sipping a pina colada.’ When this particular finalist walked out of the room, the judges said, ‘Well, that doesn’t exactly embody the entrepreneurial spirit. This guy wants to cash out.’ So he was not a winner.”