Morgan Lewis Jr.

Thursday, 26 July 2001 20:00

Resume myths

The name of this company won't be revealed because those involved obviously feel very embarrassed that this person was even employed in such a lofty position. Let's just say it's a major corporation.

A CEO was hired based on a very impressive resume and recommendations. But in just a short time, this new chief executive started to show signs of serious problems.

The company began losing a great deal of money --about $10 million. These losses couldn't be explained by a simple downturn in the market. At that point, the board of directors began to look at the business decisions the individual was making. Not only were the decisions questionable, but it seemed as though he did not understand the business.

Finally, the board asked William Penrod of KlinkFarley Inc., a business security and investigation firm, to look into this man's background. What he found was staggering.

First, the CEO claimed he was working on his MBA at a prestigious university. Penrod, Cleveland director at KlinkFarley, found he was never enrolled in the MBA program there.

The previous work experience claims proved even more troubling. He claimed he had served as vice president of a large division at a publicly traded corporation, reporting directly to the CEO. It turned out no one at the executive management level even knew the man.

He also claimed he had held the following positions at another large corporation: vice president -- business development and manufacturing; general manager; director of regional sales; and senior sales executive.

The company's human resources director could only confirm that applicant had held the position of strategic sales manager, but none of the others.

There were other claims, but rest assured, Penrod found they were greatly exaggerated or just plain false. The decisions made by this CEO cost the company hundreds of thousands of dollars and set it back years.

''It's amazing that a company will automatically spend from $100,000 to $500,000 on a relocation package for a high-level management hire, but will not budget $5,000 for a serious due diligence background investigation,'' Penrod says. ''Let's face it, no one gives bad references anymore. Everyone is a star because you are either talking to references who are friends or mentors or someone who is afraid of a lawsuit and won't tell you or HR the truth. Does the information kill the hire? Sometimes, but often it doesn't.

''Instead, it enables the interviewing process to be more informative and honest.''


Be thorough

Background screenings are already common in the Northeast Ohio area, according to a Workplace Practices Survey by the Employers Resource Council and SBN Magazine. And pre-employment drug screenings are on the rise. Last year, less than half -- 44 percent -- of employers reported using drug screenings. This year, about 52 percent said they use the tests.

The number of those who make reference and other background checks remained stable, with about 90 percent of employers saying they investigate a job applicant's past.

''The trend is a lot more companies are outsourcing the reference interviews and the employment verification, instead of just the criminal record,'' says Jason Morris, president of Background Information Services Inc. in Beachwood.

Morris says his investigators find discrepancies on resumes and job applications on about 40 percent of the thousands of checks they do every week. Like Penrod's firm, one of the biggest exaggerations they find is on previous salary and qualifications.

Despite the popularity of background checks, psychological tests do not seem to be popular with Northeast Ohio employers. Only about 29 percent of employers say they use them, and many noted they were only used for top executive positions. Twenty percent of employers reported performing the tests last year.

''I'm not a big believer in them,'' Morris says. ''People take those tests in different ways, so I don't think they hold much water. I'm more of a believer in skills testing.''

How to reach: KlinkFarley Inc. (216) 589-9750; Background Information Services Inc. (216) 514-2800


Morgan Lewis Jr. (mlewis@sbnnet.com) is senior reporter at SBN Magazine.

Thursday, 26 July 2001 20:00

Mission: Forgettable

A company mission statement is like that small fifth pocket on a pair of Levi's blue jeans: Everybody's got one, no one's really sure what it's for, but we're all glad it's there.

Northeast Ohio companies fare no better. About half, 48 percent, of employers say not everyone in their company even knows the company's mission statement, if they have one at all, according this year's Workplace Practices Survey from the Employers Resource Council and SBN Magazine. That figure is the same as in last year's survey.

But there are company owners out there who put more emphasis on their mission statement. Instead of just a generic statement about how they will "dominate the market" or "demand the best," they try to make the words an active part of their business plan.

To make your statement more significant, the first step is to make it part of a larger strategic concept, says Gary Fitzgerald, president of Meister Publishing Co. in Willoughby. In the early 1990s, Fitzgerald and a group of employee volunteers designed the Team Meister program. It not only includes a mission statement, but also a seven-point "Blueprint for Success," seven principles of how employees should treat each other, customers and the company.

The Team Meister concept includes a community outreach committee for charity work, as well as committees for employee training and development, awards and recognition, and service excellence.

Participation

One way to make sure your employees don't care or that they forget your company's mission is to have it come down as an edict from the top executive or human resources office. The key to Meister's success is that the entire company was involved in the program's design.

Fitzgerald held companywide meetings to talk about where his employees thought the rapidly growing and diversifying company was headed. He assembled a task force of volunteers from those meetings.

"That group reached out through the organization to identify what were the key elements that made us unique as a company," Fitzgerald says. "That's why it's been so well received. It's really been a companywide program in terms of the name of the program, how it would develop and its scope."

Keeping it alive

The real challenge was not designing the Team Meister program but keeping it in employees' minds. Keeping it fresh wasn't just a matter of putting up big signs reminding people, although the Blueprint for Success is placed throughout the corridors of Meister Publishing.

Fitzgerald and his volunteers also keep the program active through charity events including Harvest for Hunger, for which Meister's 105 employees last year collected 4,259 pounds of food for the needy.

There is also once a year a weeklong company event called Team Meister to encourage employees and management to recommit to the program and its values.

Lead by example

Once you and your employees commit to a mission statement or a set of values, the pressure is on you and your management team to act. A surefire way to breed cynicism is for employees to see that you put no stock in your company's mission statement, especially when it uses words like honesty, teamwork and enthusiasm.

"You have to test all your business decisions and how you conduct your activities in your organization based on these values," Fitzgerald says. "There can't be a disconnect between the executive management and the rest of the organization. Otherwise, a certain insincerity would develop within the organization."

How to reach: Meister Publishing Co., (440) 942-2000

Morgan Lewis Jr. (mlewis@sbnnet.com) is senior reporter at SBN Magazine.

Thursday, 26 July 2001 20:00

ALIENS STOLE MY STAFF!

Newsflash: Most Northeast Ohio employers have found the workers they need.

Now, if they can just hold onto them.

The once-troubling dearth of qualified workers has eased, but business owners still face a daunting task -- keeping these valued employees in the face of a slowing local and national economy.

Employee retention aside, the challenges facing business owners across the region are markedly different than those they faced last year, according to the second annual Workplace Practices Survey conducted by the Employers Resource Council and SBN Magazine. The 92 CEOs, presidents and human resource directors who responded to the survey voiced new concerns about doing business in Northeast Ohio, with results showing a more cautious, almost pessimistic business climate.

But throughout the answers to the 55 questions on employment practices, benefits issues and workplace environment, employers showed their tenacity and preparedness for today's topsy-turvy economy. The results reflect the euphoria and hangover of the previous 18 months and reveal the stability of a region unruffled by market whims.

Patrick Perry, president of ERC, can see the lighter side of these economic conditions, even though it's dark in his office.

"We're having the air-conditioning repaired today, so we're trying to keep everything as cool as possible," says Perry on a balmy June morning at the ERC's Warehouse District offices.

It was fitting that the lights were off. It was a small gesture but one that certainly made the office more comfortable for Perry's employees. And that's exactly what employers in the region are trying to do during these tougher times. Employees are acutely aware that the big cash bonuses and trips to the Bahamas will be nixed for a while, but employers and managers are still doing the little things, granting noncash perks and smaller cash perks to make this storm a bit more bearable for everyone.

Above all, Perry says, it is not a time for gloom and doom.

"This is a very, very exciting time," he says. "People thought it was exciting a year-and-a-half ago how all that money was being made. Well, all that was really masking was that (the) cliff was just getting higher and the fall was going to be significant. Now, we're rebuilding the cliff, and the exciting part is there are going to be some organizations that are going to utilize this time very well and are not just surviving today but preparing for next year or the year after.

"Those are going to be your winners. Those are going to be the kings of the hill."

Improve your people

Two challenges frequently mentioned by employers in last year's survey were growth strategies, which ranked second, and change, ranked third. This year, those issues didn't even break the top five.

Competition and increasing sales are the second and third largest concerns of employers this year, followed closely by economic conditions. But retaining qualified people topped the list of concerns.

When times are good and orders are flying out the door, it's easy to take employees for granted. Sometimes you forget they helped in your company's success. Now is the time to show your appreciation and listen to their concerns, because when the economy revs up again -- and it will -- you and your work force will be better prepared.

"An organization that has been moderately impacted (by the economy) is looking at ways to enhance the skill sets of their employees, using this slower time as an opportunity to retrain their existing work force," Perry says. "They're looking at ways to enhance their ability to retain the great employees they've recruited over the last year or so. They've worked so hard to find these people, now they want to keep them.

"And they want to keep them during a period where sales might not be so robust."

Fight the hikes

Cost containment is a perennial challenge for business owners. This year, like last, it was ranked the fourth most crucial issue on the survey. Of those costs, health care is the usually the steepest and the least predictable.

Donna Luby, president of Cleveland-based Self Funded Plans Inc., a third-party administrator of employer health insurance, says several of her clients saw their companies' health premiums jump 100 percent in one year before they decided to self-fund their health coverage.

"When the economy tightens up, more people look at self-funding their benefits for their employees," Luby says. "They see it as a way to enhance the choices and keep the costs contained."

Nationwide, 65 percent of employer-based health plans are self-funded. That number is expected to rise as insurance rates jump again this year. Often, an employer will buy insurance from a major carrier and carry a large deductible -- usually $2,000 to $5,000 --then self-fund the difference. That ensures the employer remains covered for major claims, but it can still slash premium costs with a high deductible.

Despite cost increases, employers aren't passing them on to employees, according to the survey. In fact, there was a slight dip in what the average employee pays toward health insurance coverage, from 23.1 percent last year to 21.7 percent this year. Perry says that means one of two things: Company owners are absorbing the costs, or, more likely, they are jumping from provider to provider, seeking out whichever company offers the best rate that particular year.

"The real crux of this has been the fact that most of these employers get hit with this by surprise," Perry says. "They get notified two to three to four weeks before their actual renewal. Most of these brokers are not providing a satisfactory explanation as to why to people are getting between 20 and 35 percent increases in their premiums."

In 1999, Perry started work on a project to alleviate health care pains for employers in the 22 counties that make up Northeast Ohio. Two years later, he delivered ERC Health. The insurance program is geared toward the middle market, companies with 50 to 400 employees that are too big to qualify for small business programs offered by Council of Smaller Enterprises (COSE) and Northern Ohio Area Chamber of Commerce (NOACC) but too small to wield power with big providers.

Leveraging the 400,000 employees that make up the ERC's 920 member companies, the large insurance carriers took notice. Anthem Blue Cross and Blue Shield is underwriting the ERC Health plan. Perry says it offers low rates, a ceiling on premiums and a unique wellness program to help prevent future claims. Informational meetings leading up to the release of the program were often standing room only.

"In two weeks, nearly 100 of our member companies who have attended the educational briefing were already receiving quotations from us," Perry says. "That's in a matter of two weeks, which is unbelievable. It is a reflection of the pent-up demand for product or programs that actually makes sense for this forgotten market and market segment."

Get creative

E-mail, Application Service Providers and fax machines make it much easier for those of us who stare at a computer monitor all day to do so in our bedroom slippers with a view of the backyard out the window. It's a trend that's catching on. More than half of Northeast Ohio employers who responded to the Workplace Practices Survey reported they have flexible schedule arrangements available for their employees, a slight increase over last year.

"If there are some things that don't need to be done during business hours, a lot companies are asking, 'What's the difference?'" says Joe Vitale Jr., business unit director of finance and accounting for Cleveland-based kforce.com, an online recruiting firm.

One of Vitale's clients in Cincinnati had its entire corporate accounting team work from home. Even payroll information was sent from the payroll director's home computer via a secured Internet line to a payroll processing center, where the checks were printed and mailed.

"Really, what did they need to be there for?" Vitale says. "It's cheaper to keep people at home. People are more happy there and tend to be more productive."

But it's not just flexible schedules.

A tempering of the former ironclad corporate rules on vacations, sick days and time off is sweeping the area. Today's progressive employers are looking at results, not just time spent in the office. Almost 18 percent of employers responding to the survey say they are moving to a time-off bank -- with which employees can use days off for whatever reason they choose -- instead separating vacation, personal and sick days. They're even letting employees overdraw their accounts if they deserve it.

"Let's say your superstar is getting married," Perry says. "They've run out of vacation. They get two weeks, and they need one more day. Are you really going to tell your superstar that they have no vacation time left? But you have to employ a responsible, mature, focused staff who can handle that."

Regroup and recharge

It's fun when you're making a lot of money, but it's not always conducive to creativity. Sometimes the happiest, most innovative times for companies are when everybody is just trying to rub two nickels together.

When people are using old stationary and both sides of paper, and saving paper clips, there's much more of a community atmosphere: Us against the bad times. It's a time when employees realize that they'd better be part of this team because not only will it save their jobs, it also might help save the company.

It looks like business owners won't have a problem creating a community atmosphere, or at least they won't have far to go. Almost 20 percent of employers said that everybody in their company was equally as important, just a couple percentage points lower than the number of those who said the CEO or president was the most important position.

So the bottom line is, hang in there together and be patient. This won't last forever.

"The analogy I heard from one CEO, anyone who has ever broken an ankle, when they're laid up, that first week or so, they've found their life has slowed down because they've physically have slowed down," Perry says. "They're finding that they're actually having conversations again, that they're actually reading their mail, they're actually taking more time with people on the telephone because they're slowed down.

"We have a slightly injured ankle right now in corporate America, and we should relish the opportunity to get back in touch with who we are as an organization and get in touch with what made you successful in the first place."

How to reach: Employers Resource Council, (216) 696-3636; Self Funded Plans, (216) 566-1455; kforce.com, (216) 643-8119

Kforce.com

Thursday, 30 August 2001 20:00

The Fisher King

In early 2000, Peter Nauert, chairman of Ceres Group Inc., approached Jim Fisher with what seemed like a backward idea during the dot-com explosion: He wanted to sell insurance over the Web, but rather than just deal directly with consumers, Nauert wanted his agents involved.

The concept was a distinct departure from that of Ceres' competitors, such as Progressive, that were eliminating agents from the transaction.

The project demanded sophisticated software. For prospective clients, it needed to be polished to keep the average shopper from clicking away from the site. On the back end, it had to be easy to use and update because agents needed to design their own Web pages and connect them with the hub site, QQLink.

"They said, 'Our agents made our company what it is,'" recalls Fisher, president of IdeaStar Inc. "(Nauert) wanted to create a Web site where you (as a client) can assign yourself to an agent and buy the policy from the agent or online. We had to create the technology to make all that happen. We have almost 2,000 agents cooking on this right now."

IdeaStar's flagship software, GalaxyBuilder, has quietly helped several Cleveland-area companies make a loud splash on the Web, but has drawn scant attention to IdeaStar itself. In short, GalaxyBuilder allows a nontechnical person to create a professional, multifunctional Web site in a few simple steps.

It's the foundation for Ceres Group's QQLink Web site, which connects customers to more than 1,600 insurance agents represented individually by unique Web pages. The idea was Nauret's, but the technology was all Fisher's.

"We've sold more than $1.3 million in annual life premiums so far this year," says Nancy Zalud, senior vice president at Ceres Group and a co-developer of QQLink. "Nearly half of that was in the month of May. IdeaStar helped us set that up. They've been very flexible in changes and adjustments that we've made."

Another company aided by IdeaStar's technology is e2grow.com. Founded by Dennis Barba Jr. in 2000, the community portal site provides neighborhood news, sports and business directory information to consumers but generates revenue by giving local small business owners a Web presence. A subscription fee lets business owners build their own sites and connect with customers directly in their area through e2grow.

Like Nauret's, Barba's business plan seemed to go against the grain. Instead of trying to reach a worldwide audience like many content driven sites, Barba's focus is to attract a local but Web-savvy audience. In the company's first year, Barba launched community portals for eight Northeast Ohio communities and four in the Seattle-area, and landed investors in 14 states. Fisher sits on e2grow's board of advisers, as well.

"We wouldn't be here without them," Barba says. "We got it done on time, and most importantly, within our budget. It's been a good relationship."

Fisher isn't solely responsible for Ceres and e2grow's Web successes, not by a long shot. But it is an unusually humble gesture for Fisher not to slap an IdeaStar or GalaxyBuilder logo on the sites or tie his name to them in some way.

"The fact remains, it's their responsibility to take the technology and make the business models work," says Fisher. "I'm glad I'm relieved of that. e2grow and Ceres bear the responsibility. But it is kind of cool to see it happen and see it work."

Fisher's process is straightforward: He signs a licensing agreement with clients, giving them permission to use his technology, while he agrees not create the same product for a competing client in the same industry.

"If you came to us and said, 'Give us a Web site builder, we'd say you have to cut a deal with e2Grow," Fishers says. "Customers want solutions that aren't all proprietary and locked down. They want to be able to modify and customize it. That's what's killing some of these big solution providers."

IdeaStar was called ProShows until 1999. Founded by Fisher in 1984, ProShows helped companies plan, organize and run business events and seminars using slide shows, videos and Microsoft PowerPoint presentations.

About 10 years later, Fisher added Web site development to his list of services. Steadily, the Internet services outpaced the other business segments until it was time for Fisher to reposition the company as an Internet solutions provider. Thus, IdeaStar was born.

So far, the key to Fisher's successful Web projects has been in the painstaking development process.

"We do plenty of listening to the customer or the market," Fisher says. "We strive to capture their vision and then devise unique solutions. Typically, it will be a business developer and one of our lead developers who work through this visioning process. It's the collaboration of a nontechnical and a technical person that's necessary to understand and execute the new innovation."

Once Fisher and his team are on the same page with the client, he turns the project over to his developers. Wayne Largent, IdeaStar's director of development, is an authority in an evolving school of programming called Extreme Programming (XP). If you couldn't guess by its name, XP is different than traditional software creation. Developed in the early 1990s, XP cuts development time in half, but is only beginning to gain widespread acceptance. Using templates and open code standards, the ultimate goal of XP is to get the technology to market more quickly.

"It used to be developers would have these very long development periods and very rigid methodology," Fisher says. "But in the last 10 years, there's this new phase where you go in and you pound away and you learn as you go and the client adds things and you add things."

Once a prototype is built, the original development team reassembles for a review and examination of the results. A final prototype is then ready for the arduous testing and piloting process. At the end, the project goes to the marketplace, where it's constantly measured and tested to find ways to improve it.

"At this point, either it's a winner or a dud," Fisher says. "So far, we've had all winners, but these are the risks we take using XP."

In the business world, risk is a given, and Fisher's risk-taking looks to be paying dividends. He's working on a new sister piece of software for GalaxyBuilder called CorpMeetings.

This product is also geared toward the nontechnical person. CorpMeetings traces back to Fisher's ProShows days when he helped companies organize business events and seminars.

"For people who plan meetings at corporations, it's a nightmare to get all the people registered," Fisher says. "I know what these poor people go through."

CorpMeetings automates event registration and management using opt-in e-mail. The software helps create, publish and maintain multiple registration sites, tracks participant registration and produces reports and registration information. It even sends a follow-up e-mail after the event.

"We're not going after the super-big conference or convention market," Fisher says. "We're looking for banks, law firms, large corporations, medium-sized corporations who spend a lot of time, preparing, tracking and managing the event registration."

If there's anything Fisher has learned from his time at IdeaStar, it is that going in a different direction --especially on the Web -- is usually a good thing.

"We've seen in the last year that the Web is not a business model in and of itself," he says. "It is simply a tool that can enhance existing businesses. There are some businesses that can use the Web solely as a business model, but it's pretty difficult."

How to reach: IdeaStar, (216) 587-9300

IdeaStar website

Thursday, 13 September 2001 09:12

Beyond coffee mugs

John Citraro doesn't want to take all the credit for bringing the NCAA Women's Final Four championship to Cleveland in 2007, but he can rest on the fact that his promotional idea had the tournament's selection committee members thinking about Cleveland as they drifted off to sleep.

Citraro's company, Cannon Advertising Specialties, designed pillowcases with a city of Cleveland logo and artwork for all the pillows in the all the hotel rooms of the Final Four selection committee members. Hotel staff and cab drivers also wore buttons designed by Cannon welcoming the committee to the city.

"It's a small thing, but it might have been that extra touch that none of the other cities thought of," Citraro says. "So if we helped out there, then we did our jobs."

Advertising specialty items such as coffee mugs, T-shirts, baseball caps and pens have been around for decades. The tradition started with a savvy printer who printed calendars with other companies' logos on them. The idea was that not only would the company get a yearlong advertisement, but the printer would get a regular customer, as well.

Today, there are more than 711,000 promotional items that can be emblazoned with a company logo or promotional event design, says Ross Salupo, Cannon CEO.

If that sounds like a lot, you'll believe it when you step into Cannon's museum-like showroom, a converted Catholic elementary school on East 40th Street in Cleveland. The brick schoolhouse, built in 1906, features eight rooms, including a main classroom for crystal, watches and high-end items. A cloakroom holds clothes and other apparel, which make up about 30 percent of Cannon's business.

There's also a study hall for pens, paper goods and office products, and a lunchroom, which features aprons, lunch boxes, oven mitts and other kitchen gadgets.

"This is the only medium that keeps giving without charging," Salupo says. "Let's say a client packages a refrigerator magnet with a card talking about their services. The consumer uses the magnet to hold up picture of their grandchildren. Now every time that person goes to the refrigerator, it's free, it's no charge. This is the only medium that offers the residual benefit, additional impressions at no charge."

Salupo is often faced with clients who are a little overwhelmed by their choices. In a panic, they often pick the most basic promotional item -- a coffee mug or pen -- which works effectively if those items meet the need. But really, how many mugs or pens have you already handed out?

Here are three basic questions to ask when deciding what kind of promotional item to use to advertise your company.

What's your objective?

The specialty advertising item may be used to introduce a product, to introduce a new phone number, to encourage people to test drive a car or to motivate staff. It could be a way to reward a client base or of saying thank you to a business partner. What are you trying to accomplish?

Once you have an objective it can help focus your search among the dizzying array of items.

Who's your market?

A windshield ice scraper might be a great idea for your clients in Northeast Ohio, but what do you send to those in Florida? As with any advertising, the target audience is important when considering a promotional gift.

The target could be as broadly defined as women ages 18 to 35, or it could be as narrow as workers who have been with your company 25 years or more.

What's your budget?

The question that can best focus your search is, how much do you want to spend? Salupo has $12,000 Ebel watches and $2,000 Waterford crystal vases, but he also sells stickers that cost less than a penny each.

"You have your mainstays mugs, pens, but there are so many other items that might better fit into their marketing objectives," Salupo says. "I think you'll find that anything -- anything -- can be customized."

How to reach: Cannon Advertising Specialties, (216) 431-1905

Morgan Lewis Jr. (mlewis@sbnnet.com) is senior reporter at SBN Magazine.

www.cannonadvertising.com

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