William Hoffman

Monday, 22 July 2002 09:59

Leveraging ROI

Some products are easier to distinguish from their competitors than others. Max Carey didn't figure lead was one of them. But when a supplier asked for help winning a contract with lead's major U.S. consumer-battery manufacturers-Carey did something his competition hadn't thought of. He asked manufacturers what they wanted.

Until his Atlanta-based consultancy, Corporate Resource Development Inc., approached the battery companies, suppliers believed price was their major competitive advantage. However, CRD discovered that battery CEOs were more concerned with the environmental costs of lead than with its price. CRD and its client then fashioned a cradle-to-grave lead life cycle management program that became the toast of the industry. Not only did Carey's client get the contract, it won a premium price and a long-term commitment from a grateful customer.

Carey believes the request for bid (RFB) which started this process, and which CRD turned to its client's advantage, is the bane of a growing company's business. "What the buyer is telling you is that we believe yours is fundamentally a commodity product," says Carey, whose 18-year-old company specializes in sustaining (or creating) a client's competitive advantages.

"As far as I'm concerned, that is the kiss of death for a sale. The control over pricing is now entirely out of your hands," Carey says. Challenging the RFB requires that you identify the buyer's real agenda-an agenda sometimes unrealized by the buyer himself-to reclaim control over the selling process. "Control is the single most important part of the sale."

Sometimes it's simpler than creating an industrywide maintenance program. Bidders consistently willing to go the extra mile, mindful of budgets and deadlines, ready to point out savings that might help buyers after the work is done, build reputations over time that command a premium, according to Richard Huchison, principal at the CPA firm of Clark, Schaefer, Hackett & Co. in Dayton, Ohio.

"Sometimes [buyers] relish the idea of taking advantage of an efficiency in their job that they never thought of," Huchison says. Still, a thorough understanding of the client's business, a relationship of trust-not to mention adherence to project specifications-is mandatory to prevent foul-ups. "If you've gone off half-cocked, you're stuck," Huchison cautions, and you may never get the chance to make things right.

The risk of backlash, either from misunderstanding the client's desires or from offending his or her culture by trying to color outside the lines, is real, Carey agrees. To insure against that risk, he says, concentrate first on prospects rather than established customers and on major bids rather than every RFB that crosses your desk.

"It's all built around research," says John Pekas, CRD sales manager, "so that you know more about that company than they know about you." He compares the sales process to the old lawyer's trick of never asking a question to which one doesn't already know the answer.

"Our strategy is to get our client involved with someone who is more interested in return on investment, rather than deciding on expense basis," Carey says. That means reaching not only the decision maker, but the person or people who set the company's strategic agenda. Sometimes that's not the same individual.

If a company is resistant to your inquiries, you're likely to know it early on. Use confidentiality agreements to protect the prospect's privacy if that is among their concerns. But, says Pekas, "If you put yourself in a position where you have information that they'd like to know, it won't take them long to respond positively."

Monday, 22 July 2002 09:58

Onboard, online

If you have a copy of Microsoft Word 97 and an Internet connection, you probably have all you need for your company’s Web site.

Most businesses will want to post more than their company’s name, phone number, e-mail address and catalog listings, however. The good news is that for just a couple hundred dollars more than you paid for Office, you can get a complete set of software tools and the hardware support to put up a really snazzy site that will keep ’em coming back ... and maybe even buying.

“Most of the money you spend on a Web site is on labor, not on tools,” according to Neil Randall, author of “Special Edition Using Microsoft Front Page 98” (Que Publishing). “Ninety to 95 percent of what you want to do is in these [software] packages,” i.e., Front Page, Macromedia’s Dreamweaver or Claris’ HomePage. Each supports the icon-centric, drag-and-drop interfaces that made computers welcome in the front office in the first place.

Because the Internet is composed of electrons and similar intangibles, knowing which tools one needs to build a Web site may seem daunting. Most of them are listed below.

Web authoring software The aforementioned products and their competitors offer a range of easily-accessible tools such as text editors (for choosing among fonts, sizes, columns), graphics editors or composers (for selecting and modifying illustrations), linkers (for including e-mail addresses so they can forward customer inquiries to you), etc.

You might consider parting with a couple ducats for a good third-party manual explaining how to use the software; engineers tend to be poor at explaining things to amateurs. And only an idiot could miss all the books for “Dummies” (or is it the other way around?) now available.

Optional add-in packages If you want to include customizable forms, animation or sound in your site, you may have to invest a bit extra for a compatible software package. “But with each release of the [authoring] products, it’s less and less true,” Randall notes.

An Internet connection Besides downloading stock quotes and porn to your computer, you can often use the same Internet connection to upload stuff to your Internet service provider’s computer. A server is a repository for all kinds of shared information, including Web sites. Many ISPs offer a sliver of that computer space (usually measured in megabytes) to customers as part of their connection fee.

Call your ISP for details on available space, expansion capabilities and prices, administrative and other service costs. Randall estimates $25 to $200 a month should do it, depending on how busy your site is. Lincoln Stein, author of “How to Set Up and Maintain a Web Site” (Addison Wesley Longman), says a meager 1,000 hits a day requires minimal (often automated) maintenance. A robust 100,000-hit-a-day site, by contrast, will need daily attention.

A domain name The ubiquitous “.com” address is a service provided for a fee. You can register one under your company’s name—if you can wait, it may take several months, and if that name hasn’t already been registered to someone else. Or you can let your ISP assign you a name under its auspices. Not as glamorous, but far more economical for the beginner.

Monday, 22 July 2002 09:33

Law briefs

Money votes

Though the Electoral College officially decides the 2000 presidential race Dec. 18, we already know who won the money race in Pittsburgh and Western Pennsylvania congressional districts.

According to Federal Election Commission data analyzed by the nonpartisan Center for Responsive Politics, in Washington, D.C., the fund-raising champs in local races in each case also won their Nov. 7 elections.

  • District 14 (Pittsburgh): William J. Coyne (D), incumbent; unopposed, $126,572

  • District 18 (Pittsburgh): Mike Doyle (D), incumbent, $315,697; Craig C. Stephens (R), $6,009

  • District 4 (northwest of Pittsburgh): Melissa Hart (R), $1,371,461; Terry Van Horne (D), $549,322

  • District 20 (south of Pittsburgh): Frank R. Mascara (D), incumbent, $458,886; Ronald J. Davis (R), $0

  • District 12 (east of Pittsburgh): John P. Murtha (D), incumbent, $766,451; Bill Choby (R), $6,990

  • District 21 (north of Pittsburgh): Phil English (R), incumbent, $992,284; Marc Flitter (D), $236,018

A hand, not a hand-out

When a Pennsylvania construction company modified a dump truck for a one-armed driver, the company not only gained a more self-sufficient employee, it freed for other duties a second employee who previously had to ride along, and got a state reimbursement for the cost of the modification.

Site, building and transportation modifications, adaptive machinery and equipment, and specialized employer training for the disabled are eligible for up to $50,000 in grant funding from the three-year-old Independence Capital Access Network.

First, apply beforehand at the Pennsylvania Office of Vocational Rehabilitation, which administers the program. After completing the project, submit expense receipts to the OVR. The agency reimburses in four to five weeks.

The disabled worker for whom accommodation was made must remain on the job for at least one year. An OVR specialist will check after about six months to confirm. How to reach: Stephanie Parker, Office of Vocational Rehabilitation, (717) 787-5123

Appeal for calm

If you own commercial property in Allegheny County, you should have received Sabre Systems and Service's preliminary property tax valuation by now.

Sabre Systems was paid $23.9 million by Allegheny County to reappraise property values after a judge invalidated the existing tax system, then lifted an assessment freeze imposed by county commissioners.

The new assessments are supposed to be revenue-neutral -- for every extra $1 paid by one property owner, another owner should pay $1 less. Of course, that's cold comfort for the taxpayer with the higher bill. Local tax districts could raise their rates, though state law limits their reassessment windfall to less than 5 percent.

Keep these things in mind as you stew over your notice:

  • Sabre's appraisal estimates your property's value, not your property tax assessment. The latter is set by county commissioners, your municipality and/or school boards.

  • Go to www.reevaluation.net and enter the "e-code" on your Preliminary Notice of Market Valuation. Verify that Sabre's photo really shows your building, and that other data about your property is correct. Note any discrepancies.

  • If you want to challenge your valuation -- and everybody wants to -- contact Sabre. The information is on your notice. You'll be called to its Point Breeze office at 400 N. Lexington St. Business income and expenses, and sale prices of similar businesses, are key to estimating commercial property values. Find evidence to prove Sabre made a mistake in your case.

  • Your official valuation will be mailed around Jan. 1. Still not satisfied? Submit an appeal application to the Allegheny County Board of Property Assessment. The appeals and review process is scheduled to end by Feb. 28, 2001. Get an appeal application from www.county.allegheny.pa.us, from the county, your municipality or a local library. Again, bring evidence.

  • Still unhappy? File an appeal with the Prothonotary's Office at the City-County Building within 30 days of the date on the letter deciding your county appeal. But unless you've got a very strong case -- or a really outrageous assessment -- you might bring along a signed check.

Midnight for regulators

A recent George Mason University study claims that -- like Cinderella racing home from the ball -- federal agencies rush to finalize pet regulatory projects in the final months of outgoing presidential administrations.

Jay Cochran, a research fellow at GMU's Mercatus Center, reviewed page counts of the daily Federal Register from 1948 to the present. He reports that average Register volumes swelled 17 percent in post-election November-to-January quarters, compared with the same months in nonelection years.

Opponents first noted those "midnight regulations" during the transition from Jimmy Carter's administration to Ronald Reagan's in 1980-81. Cochran says the phenomenon crossed party lines all the way back to the Truman presidency. Critics say counting Register pages is an inaccurate measure of meaningful regulatory work. Agencies say their processes -- often set to congressional and court-ordered schedules -- are largely independent of executive branch intervention. They dismiss Cochran's study as a public relations stunt by anti-regulation activists.

Good news for cell phone users?

The Federal Communications Commission may allow licensees of government radio frequencies to sublease them for commercial use in wireless and other services.

The FCC proposal seeks to encourage a "secondary market" in radio spectrum frequencies, to relieve demand pressures on the burgeoning wireless communications markets. "This demand threatens to outstrip supply and to impede the future growth of wireless services," the FCC announced Nov. 9.

If adopted, the proposal would be good news for wireless service providers and for consumers who use cell phones and other wireless telecommunications technologies.

Veterans need apply

The U.S. Small Business Administration is accepting public comment until Dec. 11 on a plan to set a 3-percent government-contracting goal for service-disabled veteran-owned small businesses.

The plan would implement parts of the Veteran Entrepreneurship and Small Business Development Act signed by President Clinton in August 1999.

The SBA wants additional government contract procurement assistance for veterans, including a requirement that federal agency chiefs move toward the 3 percent goal in their departments' prime contract and subcontract awards.

As part of the act, the SBA earlier this year established an Office of Veterans Business Development. The office seeks outreach to veterans, establishment of an information network and expanded access to technical assistance programs for service-disabled veteran-owned small companies.

OSHA's final ergonomics rule

The Occupational Safety and Health Administration released its controversial final "ergonomics program standard" in November.

No business will be spared, though companies with 10 or fewer employees won't have to keep records. More than 100 million workers at 6.1 million workplaces will be covered, with the exception of those in maritime, agriculture, construction and railways.

The rule becomes effective Jan. 16, 2001.

OSHA estimates the cost to business at $4.5 billion a year. Business groups argue it's likely to cost several multiples of that. Small business gets a few concessions in the final standard, OSHA says. In addition to the small business reporting exemption, the agency offers a "Basic Screening Tool" which companies can use to determine whether ergonomic issues require compliance action.

Employers with just one ergonomic-related injury in a job, or just two such injuries companywide in the previous 18 months, can apply "Quick Fix" solutions within 90 days. OSHA believes this will appeal particularly to smaller firms.

The final rule gives companies four years to install permanent ergonomic controls (See related article in this month's Of Counsel Quarterly.) William Hoffman is a Washington, D.C.-based freelance writer.

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