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9:57am EDT July 22, 2002

Y2K as a competitive edge

Health care is one of the least prepared industries for Y2K. But Medical Mutual of Ohio not only claims to be Y2K compliant, it has figured out how to use it to get new business.

The program, called Assurance 2000, offers employers an alternative for health benefits programs that aren’t Y2K compliant.

Employers can switch their health benefits from noncompliant carriers to Medical Mutual — at prices similar to their existing programs — according to Ed Hartzell, president and CEO of Antares Management Solutions, which markets Medical Mutual’s Y2K compliant systems.

A health program flatlines

Speaking of health care, nobody was particularly surprised last month when the Cleveland Health Quality Choice program quietly slipped out of its coma and into oblivion.

When founded 10 years ago by a coalition of business and health care interests, the program was the first effort anywhere to measure and track hospital outcomes. The idea was to provide data so businesses could make informed decisions about where to send employees for the best care.

While the Cleveland Clinic’s withdrawal from the program sealed its fate, the clinic was not the first hospital group to pull out.

According to a high-level clinic insider, none of the hospitals withdrew because they were afraid of the scrutiny. Rather, they resented having to pay to support the program while businesses interests continued to ignore their suggestions on how to make the data more meaningful.

“All they were interested in was cost,” the source said. “There was no sense that anybody was even using the data.”

If only costs would do the same

While the death of the CHQC seems to indicate business has given up trying to sort out health care quality issues, there’s no end in sight for the need to manage costs.

Last year, total health benefit costs for active employees increased 5.7 percent in Cleveland, reaching an average of $4,464 per employee.

Cleveland business owners shell out more per employee than owners anywhere else in Ohio, which has a statewide average of $4,054 per worker. Ohio’s average, by the way, exceeds the national average of $4,037.

According to a William M. Mercer Inc. survey, costs are going up because of consolidation within the health care market and due to widespread cost increases for prescription drugs. Similar increases are expected again this year.

Doctor vs. doctor

Business and hospitals aren’t the only institutions at odds in the increasingly brutish health care industry.

An old dispute between the Academy of Medicine of Cleveland and the Ohio State Medical Association over membership dues and attracting local members will be settled in court — again.

The academy — which serves as the county’s medical association, providing lobbying services, group benefits and other services — filed suit against the State Medical Association in January after the association pulled the academy’s charter and began a competing local organization.

It’s the second time the state association has withdrawn the county group’s charter; the first time, courts overruled on a technicality.

Checking in on old friends, part 1

When SBN profiled ProForma’s Greg Muzzillo in March 1998, the founder of this Independence-based business firm and promotional printing company laid out some lofty goals — 400 franchisees, each doing $400,000 a year, by February 1999 — and eventually companywide sales of $1 billion.

In fact, Muzzillo’s company did hit the magic 400 right on schedule, topping $100 million in revenue in the process.

It’s a great example of hitting an ambitious target, but it also illustrates the problem endemic to the fast track: The more you grow, the harder it is to keep growing.

When we first checked in with ProForma, its 270 franchisees were averaging about $265,000 a year. Today, that average has dipped to about $250,000. To be fair, with more than 100 new owners in the last 12 months, some of that decline must be due to the expected spinning of wheels. But the bottom line is this: The closer ProForma gets to $1 billion, the farther away it must seem.

Old friends, part 2

Hi TecMetal, profiled by SBN last October, received QS-9000 registration for its HTG Copper Brazing Industries in Warren, Mich. The brazing unit pursued the registration so it could continue as a tier-one supplier to the Big Three auto makers, according to HTG’s CEO Terrence Profughi.

Old friends, part 3

Creativity for Kids, which SBN looked at in February 1998 for its unique approach to product development, has announced 15 new toy kits for 1999. The kits, primarily craft-style products, can be seen at the company’s Web site,

New help for small business

Northeast Ohio’s first Business Information Center has already opened for walk-in business and will be officially dedicated at a ceremony April 6 at 2 p.m.

Located in Playhouse Square at 1718 Euclid Ave., the BIC offers free business research tools, including a library, software library and Internet searches.

Operated in partnership between the U.S. Small Business Administration, the Service Corps of Retired Executives and, in this instance, KeyCorp., the BIC will be staffed by volunteers to help visitors with a range of business needs, from writing a business plan to researching tax issues, to making photocopies and defining market demographics.

The center occupies 850 square feet of a former KeyBank branch, which was donated by the bank.

“It’s downtown, but at the edge of downtown and looking out on the (federally designated) empowerment zone,” says Gilbert Goldberg, district director of the SBA’s Cleveland region office. “I would hope it could become a beacon for people who want to do business inside the empowerment zone.”

The center is open from 10 a.m. to 3 p.m., Monday to Friday. The phone number is (216) 522-4194.

Measuring up

If you doubt there’s money to be made from the Internet, consider National Market Measures Inc., a Westlake market research firm. It’s started construction on a new 4,500-square-foot focus group and interviewing facility in Solon to replace a smaller building in Mayfield Village. Founding partner Martha Kain says the new development will meet growing demands for the company’s research practice, which is being done increasingly via the Internet.

When, and where, to hold back

Business owners concerned with Internet privacy issues are rethinking how much company information to reveal on their Web sites. Conversely, they’re wondering what to do with the sensitive information they gather from site visitors.

The Better Business Bureau is accepting applications from its members for an online privacy seal — which tells visitors that any information they offer will be held in strict confidentiality. Companies that qualify agree to follow stringent privacy guidelines when conducting e-commerce on the Net. Eligibility requirements can be found at the BBB Web site at

See you, see me

In their wish to learn as much about prospective hires as possible, employers are turning to personality assessments. In their wish to prepare as well as possible for job interviews, prospective employees are turning to the Web site of Advantage Companies, which offers several personality assessments to help job seekers prepare. The site is at

There’s always Amtrak

In a touch of irony, considering Cleveland’s recent accolades as a business center, the North Coast fared poorly in Sprint’s most recent ranking of the most productive cities in America. Out of 313 metropolitan regions, Cleveland came in 87th. Dallas was No. 1.

One big strike against Cleveland was accessibility to the city. Meanwhile, the IX Center battle continues and expansion of Cleveland-Hopkins International Airport does not.

More HR discounts

The Employer’s Resource Council, a membership-based human resources organization, has added the following companies to its Dream Team: Tallmadge’s SACS Consulting and Investigative Services and Creative Stages Ltd., an “innovation consultancy.” The Dream Team is a group of providers offering services at a discount rate to ERC members. Others participants include ADP, Cohen & Co. and Deloitte & Touche.

For more information, call the ERC at (216) 696-3636.

It’s not the economy after all, stupid

Fueled by optimistic signs at the end of 1998 and beginning of 1999, nearly two-thirds of Cleveland technology business owners say they expect international revenues to increase this year by more than 2 percent, despite the economic malaise in Asia and South America. According to a PricewaterhouseCoopers survey, nearly 90 percent of the business owners attribute their optimism to higher quality products and rising demand for new technology. Oddly enough, economic conditions and the ability of customers to pay didn’t seem to play a role in the thinking.

Bring on doomsday ...

Don’t believe the worst-case predictions about small business owners getting caught in a Y2K disaster when the year ends; more than 80 percent of Cleveland technology business owners say they are ready, willing and Y2K compliant, according to another part of the PricewaterhouseCoopers survey. But there’s a downside: While the owners admit they’ve received assurances from their IT departments about their own preparedness, fewer than half are convinced that businesses they deal with are just as ready.

Or avoid doomsday altogether

Here are four quick tips for avoiding a computer meltdown at year end, from computer expert Eileen Buckholtz, author of “Y2K: Run to Save Your PC from the Year 2000 Bug:”

  • Buy new computers early. Prices are low now, but a summer rush to upgrade could bring the first computer price increases in history as people discover old systems aren’t compliant.

  • Y2K-proof new contracts. Before you sign on the dotted line, get assurances from computer suppliers that their products are compliant.

  • Hold that sigh of relief. Just because the bank and utility companies say they’re compliant, that doesn’t mean your computer can work with their upgraded systems. Test them.

  • Practice for 2000. Keep a log of significant annual business events, such as first payroll, electronic bank transactions and inventory checks. Set the time and date to Y2K and test run your computer to see if those tasks are processed correctly.

Bringing out the best in people

Do you have trouble motivating borderline employees who you know can excel? According to a new book, “Encouraging the Heart: A Leader’s Guide to Rewarding and Recognizing Others,” by James Kouzes and Barry Posner ($22, Jossey-Bass Inc.), here are seven tips to get the most out of your employees:

1. Set clear standards. Goals that can be achieved make people feel like winners.

2. Expect the best. Show employees you believe in them and they’ll work harder not to let you down.

3. Pay attention. Mingle with workers instead of isolating yourself.

4. Personalize recognition. When you tailor to the recipient’s tastes and interests, even the smallest award is special.

5. Tell the story. When you reward employees, do it in a forum where you can tell other workers how that employee earned the award.

6. Celebrate together. Remind the staff that success is a group effort.

7. Set the example. Leaders must set an example by demonstrating how to contribute, celebrate and succeed. Others will follow.