John Ettorre

Wednesday, 23 March 2005 06:32

The Ford file

Born: May 3, 1957, Detroit

Education: Bachelor's degree, Princeton University; master's degree, management, M.I.T.

Career moves: Began employment with Ford Motor Co. in 1979 as a product planning analyst, subsequently held a variety of positions in manufacturing, sales, marketing, product development and finance. Elected a company director in 1988; has held a number of management positions at Ford, including international assignments, culminating in vice president, Commercial Truck Vehicle Center, in 1994; 1995, became chair of the board's Finance Committee, a position he held until becoming CEO in 2001. Named chair of the board's Environmental and Public Policy Committee in 1997; became chairman of the board of directors 1999; named CEO 2001

Corporate committee memberships: Environmental and Public Policy, Finance

Board affiliations: Chairman of the Board of Trustees, Henry Ford Museum and Greenfield Village; trustee, Detroit Renaissance and Princeton University Brookings Institute; member of the World Economic Forum's Global Leaders for Tomorrow; vice chairman of the Greater Downtown Partnership Board of Directors (Detroit)

Accolades: In 1996, named to Newsweek magazine's "The Century Club," a list of 100 people to watch as America headed into the next millennium. In March 2000, graced the cover of Fortune magazine, which deemed him a "breath of fresh air for Detroit" and lauded both him and Ford Motor Co. for continued progress economically and environmentally within the auto industry.

Monday, 22 July 2002 10:10

Workplace environments

Workplace environments

Are cube farms on the way out?

By John Ettorre

In the future, you'll spend more on outfitting the office: more space and better stuff to fill it. The future, you see, belongs to ergonomics.

Job-market demographics equals destiny. With an ever-larger slice of the working population becoming deskbound computer jockeys, companies will be pushed to prevent aches and pains in a far broader spectrum of the workforce-not just shipping clerks and data-entry people, but maybe the CFO as well.

If that doesn't stimulate a boom in deluxe, $1,200 chairs designed by downsized NASA engineers, it already has meant a brisk trade in more moderately priced items such as ergonomic mousepads (with wrist support, around $15).

Meanwhile, the once-trendy notion of squeezing employees into ever-smaller quarters has been checkmated by an impossibly tight labor market, which has dramatically shifted the balance of power between employee and employer.

Besides, the wildly popular "Dilbert" cartoon strip has forever trumped management's ability to painlessly resort to the sardine strategy. So adjust your thinking on the office budget; you'll have no choice but to lease some additional poly-shag acreage, lest your human capital suddenly decide to engage in mass egress.

If your workforce is increasingly virtual-either due to a larger proportion of telecommuters or more satellite offices whose occupants share assignments-the big job is figuring out how to make the widespread talent pool work like one big happy team.

And it is an inevitability; if you don't believe in telecommuting for your company, it may soon force itself upon you as the only way to keep good people.

There is, naturally, a consulting discipline arising around the confluence of people, technology and distance. Among companies in Northeast Ohio, look for insurance giant Progressive Corp. to live up to its name by contracting for some of the more interesting ideas in this embryonic discipline. Manco, an organization traditionally big on internal training in anticipation of new environments, might follow closely behind.

Monday, 22 July 2002 10:09

The return of 20 questions

The return of 20 questions

Companies need to draft documents carefully before defining workers as independent contractors.

By John Ettorre

Microsoft's ongoing legal battle with the federal government over its right to bundle certain software products has become something of a spectator sport in some business circles. But a far-less-celebrated court case involving the classification of independent contractors, in which the software giant recently took it on the chin, probably has more implications for the prospects of most companies.

Last year, Microsoft lost a case brought in federal court by a group of workers who challenged the company's classification of their services as independent contractors. They won their case in an appeals court despite the company's explicit offer of higher-than-normal pay in exchange for not offering fringe benefits. When the U.S. Supreme Court recently refused to hear an appeal of that decision, it effectively left in place what some see as a worrisome new policy statement which could open Pandora's box.

"The decision has sent a chill through the employee benefits community," attorney Ron Kahn of the Cleveland law firm Ulmer & Berne LLP recently observed in the firm's newsletter. What the decision might ultimately mean is that "the substance of an employment relationship will usually govern over the form in which it is packaged."

In an interview, Kahn, chair of the firm's business/tax department and a former general chairman of the Cleveland Tax Institute, notes that the case has serious implications not only for those companies that employ independent contractors but also for those which lease employees and even those that employ part-timers. But in most cases, the court decision suggests, the problem can be remedied simply through more careful drafting of employment plans and other documents.

The ruling, which technically establishes a precedent only in the western region where the San Francisco-based Ninth Circuit appeals court has jurisdiction, is also expected to reinvigorate the Internal Revenue Service's 20-question test for judging whether a worker should be considered an employee for tax purposes (see box). First added to the tax code 20 years ago, the test actually has common-law roots which date back much further. Crucially, the tax-collecting agency has always taken the view that an employer need not actually exercise control over a worker in order for him or her to be classified as an employee, but merely retain the right to do so.

While Kahn agrees that the 20-question test will be given renewed attention in the wake of the Microsoft case, he argues that the key question of whether a worker is an employee under the law is even simpler than that. "Are they subject to the direction and control of the employer? If they are, then they're likely to be classified as an employee."


The IRS 20-question test

Is the person providing services required to comply with instructions about when, where and how the work is to be done?

Is the person provided training to enable him/her to perform a job in a particular method or manner?

Are the services provided integrated into the business's operation?

Must the services be rendered personally?

Does the business hire, supervise or pay assistants to help the person performing the services under contract?

Is the relationship between the individual and the person he/she performs services for a continuing relationship?

Who sets the hours of work?

Is the work performed at the place of the business of the potential employer?

Who directs the order or sequence in which the work must be done?

Are regular written or oral reports required?

What is the method of payment-hourly, commission or by the job?

Are business and/or traveling expenses reimbursed?

Who furnishes tools and materials used in providing services?

Does the person providing services have a significant investment in facilities used to perform services?

Can the person performing the services realize both a profit and a loss?

Can the person providing services work for a number of firms at the same time?

Does the person make his/her services available to the general public?

Is the person providing services subject to dismissal for reasons other than nonperformance of contract specifications?

Can the person providing services terminate his/her relationship without incurring a liability for failure to complete a job?

Monday, 22 July 2002 10:09

Money

Get your C corp in order

By John Ettorre

So-called C corporations have increasingly become the vehicle of choice for private business owners who are attracted by their lower tax rates and superior financial flexibility. But tax specialists are also issuing a few cautions.

They note that in cases where there is more than one owner involved, the partners should have a buy-sell agreement in place. It should specify the procedure for and the terms under which partners or their estates could buy into or out of the partnership in the event of one partner's death.

Then there's the issue of improperly drafted C corps. As Jones, Day, Reavis & Pogue tax attorney Christopher Jenks recently noted at a seminar for entrepreneurs, the Internal Revenue Service is taking a harder look at whether some C corps are merely tax-avoidance schemes for individuals. "There are several provisions of the tax code designed to catch people who are using C corps as a dodge," Jenks said. While they haven't been invoked much in recent years, "a lot of tax professionals are concerned they could be soon."

Monday, 22 July 2002 10:09

The return of 20 questions

Microsoft's ongoing legal battle with the federal government over its right to bundle certain software products has become something of a spectator sport in some business circles. But a far-less-celebrated court case involving the classification of independent contractors, in which the software giant recently took it on the chin, probably has more implications for the prospects of most companies.

Last year, Microsoft lost a case brought in federal court by a group of workers who challenged the company's classification of their services as independent contractors. They won their case in an appeals court despite the company's explicit offer of higher-than-normal pay in exchange for not offering fringe benefits. When the U.S. Supreme Court recently refused to hear an appeal of that decision, it effectively left in place what some see as a worrisome new policy statement which could open Pandora's box.

"The decision has sent a chill through the employee benefits community," attorney Ron Kahn of the Cleveland law firm Ulmer & Berne LLP recently observed in the firm's newsletter. What the decision might ultimately mean is that "the substance of an employment relationship will usually govern over the form in which it is packaged."

In an interview, Kahn, chair of the firm's business/tax department and a former general chairman of the Cleveland Tax Institute, notes that the case has serious implications not only for those companies that employ independent contractors but also for those which lease employees and even those that employ part-timers. But in most cases, the court decision suggests, the problem can be remedied simply through more careful drafting of employment plans and other documents.

The ruling, which technically establishes a precedent only in the western region where the San Francisco-based Ninth Circuit appeals court has jurisdiction, is also expected to reinvigorate the Internal Revenue Service's 20-question test for judging whether a worker should be considered an employee for tax purposes (see box). First added to the tax code 20 years ago, the test actually has common-law roots which date back much further. Crucially, the tax-collecting agency has always taken the view that an employer need not actually exercise control over a worker in order for him or her to be classified as an employee, but merely retain the right to do so.

While Kahn agrees that the 20-question test will be given renewed attention in the wake of the Microsoft case, he argues that the key question of whether a worker is an employee under the law is even simpler than that. "Are they subject to the direction and control of the employer? If they are, then they're likely to be classified as an employee."


The IRS 20-question test

Is the person providing services required to comply with instructions about when, where and how the work is to be done?

Is the person provided training to enable him/her to perform a job in a particular method or manner?

Are the services provided integrated into the business's operation?

Must the services be rendered personally?

Does the business hire, supervise or pay assistants to help the person performing the services under contract?

Is the relationship between the individual and the person he/she performs services for a continuing relationship?

Who sets the hours of work?

Is the work performed at the place of the business of the potential employer?

Who directs the order or sequence in which the work must be done?

Are regular written or oral reports required?

What is the method of payment-hourly, commission or by the job?

Are business and/or traveling expenses reimbursed?

Who furnishes tools and materials used in providing services?

Does the person providing services have a significant investment in facilities used to perform services?

Can the person performing the services realize both a profit and a loss?

Can the person providing services work for a number of firms at the same time?

Does the person make his/her services available to the general public?

Is the person providing services subject to dismissal for reasons other than nonperformance of contract specifications?

Can the person providing services terminate his/her relationship without incurring a liability for failure to complete a job?

Monday, 22 July 2002 10:05

Where all paths cross

You may never have heard of her, but Joan McCarthy nevertheless might just have a pretty good fix on you. As a business owner, she's more Howard's End than Wall Street. She makes her living not by pitching her services over lunch but by arranging the breakfast or lunch meeting itself, taking the last available seat at board meetings or monthly public events. You might, in fact, notice her only when she accepts your money at the door or unobtrusively switches off an air-conditioner that threatens to drown out the speaker.

Hers is the ultimate behind-the-scenes presence, and yet Joan McCarthy has come to be something of a walking nerve center for much of Cleveland's business and entrepreneurial community. Through her company, MJM Services, she and a staff of five administer the back-office functions of no fewer than 29 nonprofit professional and alumni groups. They include local chapters of arguably the country's three top business schools-Harvard, Wharton and Stanford-as well as general graduates of Princeton, Harvard and Yale. Her clients also include groups composed of fund-raising execs, venture capitalists and insurance agents-with a couple of medical specialists' groups thrown in.

From that central position, her operation functions as an unofficial scheduling clearinghouse for events and speakers, as well as the guardian of a vast database of movers and shakers in business and the professions.

MJM maintains membership mailing lists, publishes meeting notices and tends to the physical arrangements of board meetings and public events. It pays bills and balances the books for client organizations. It recommends appropriate speakers and meeting sites. "We keep track-of people, money, addresses and reservations," McCarthy says.

But her biggest value-added service, she says, is her ability to offer client organizations consistent membership service from one slate of volunteer officers to the next. Leaders, in turn, "are more willing to take on an officer role, because they know they won't be burdened by putting stickers on envelopes once a month."

Her plunge into association management began 15 years ago with the Harvard Business School Club, whose local chapter bills itself as one of the largest in the world. Clubs in Boston and New York have more members, says Morganthaler Venture partner Bob Pavey, a longtime board member, "but they [Harvard] tell us that we have the highest penetration of MBAs of any club in the world." McCarthy was an accountant working on the support staff of an insurance agency in 1983 when a friend mentioned the club's administrator was retiring. Rather than recommend a replacement, she took the assignment herself, part-time at first.

By 1987, with the Princeton Club and the Association for Corporate Growth having joined her fold, she opened an office downtown. She didn't even have a computer at first, and grew only by referral. It didn't hurt that she shared office space with a well-connected Cleveland business lion, Bob Ginn. To this day, the retired former chairman of Cleveland Electric Illuminating Co., still a fixture at the Union Club well into his 70s, plugs McCarthy's operation every chance he gets. "We affectionately refer to him as our marketing arm, because he's always encouraging people to work with us," she says.

In retrospect, her timing was excellent. The wave of corporate downsizing that began in the 1980s left many business and professional volunteers with fewer staff at their primary office to handle outside tasks, thus helping create her niche. "I'm not sure the market was really there prior to 1987," she says. "Prior to that, the kinds of things we do were handed off by the officers to their secretaries."

But some also suspect that McCarthy is a cannier businessperson than her reserved nature might suggest. Her friend Kevin O'Donnell, the retired chairman of Sifco Industries, and a Harvard Business School graduate, needles her when he bumps into her one evening at dinner. "I think she attended all those meetings of the Harvard Business School and stole all their ideas," he says.

John Dick, a principal in Primus Venture Partners and the new president of the H.B.S. Club of Northeastern Ohio, readily concedes that "without Joan, we'd die. She's been organizing Harvard Business School Club events and doing our accounting forever. She attends all the events and knows all the traditions. And as guys like me pass through [the leadership ranks], I lean heavily on her. She's kind of a treasure-trove of what's going on, not only in Northeast Ohio, but nationally. And she's a big help, whether it's trying to get ahold of a CEO or a venture capitalist. She knows them all."

The single, 50ish McCarthy indeed knows an astounding number of people. She is not someone with whom to casually match wits in a game of do-you-know...? That's a function of the breadth of her client base and, she maintains, a hallmark of her large westside-Irish family. She also reads everything she can get her hands on to keep up with job changes and relocations. "We rarely go into a situation where we don't know someone," she says.

But her discipline has also helped her flourish. Rather than responding to every potential client interested in outsourcing its back-office support function, she's remained exceptionally choosy about the organizations she'll accept as clients and the types of tasks she'll perform. "We don't do trade associations-only professional associations and alumni groups," she says. She turns down one-time events in favor of long-term contracts, thereby avoiding constant rebidding. And she doesn't do parties. "Please don't portray us as being party-planners," she pleads. "There are people who think we cater." While she gets the occasional inquiry about planning the wedding of a client's daughter, she diplomatically declines. "I'll be glad to sit down for a half-hour and give somebody some suggestions. But I'm not in the wedding-planning or party-planning business," she says.

Her staff is organized along account-executive lines, with each retaining prime responsibility for about a half-dozen clients. McCarthy keeps primary watch over Harvard and Wharton School alums, the Ohio Venture Association, the Association for Corporate Growth and Town Hall series. During peak seasons, generally early April to mid-May and early October through Thanksgiving, her staff might be planning and overseeing as many as 17 or 18 events each week. "You have to be good with people, detail-oriented and fairly unflappable."

She estimates the combined membership of her clients between 50,000 and 70,000, though with plenty of overlap-people who hold a graduate degree from one institution and an undergrad diploma from another, and who also belong to a couple of professional groups. Her wariness on the telephone suggests that she understands only too well how valuable these lists might be to salespeople (including members of a client, the Northern Ohio Direct Marketing Association). She remains on high alert, ever-vigilant for cunning poachers eager to cadge a gold-plated list. "I guard them with my life. I have a sixth sense about that kind of thing," she says.

Her computer system is arranged so as to avoid mixing the various membership lists, and she will release none without written authorization from the president of the organization. "That's not their rule, it's mine," she says. "From an integrity standpoint, there can't be even the appearance of impropriety, or my reputation is gone."

Like all successful owners, McCarthy keeps a sharp eye on cash flow-only in her case, it's more that of her clients than her own. She recently fielded a call from someone who's a member of several of her client organizations. I've got a thousand dollars of bills for membership sitting here, he told her in mock horror.

"I said, 'start writing checks.'"

Monday, 22 July 2002 10:05

John Beckett's twin callings

It was 1979, and for the second time in six years, OPEC had stopped shipments to the developed world in order to drive up the price of oil.

While American consumers stood fuming in lines at the gas station, the second oil shock was more than an inconvenience for John Beckett.

Beckett is the second-generation owner of Elyria-based R.W. Beckett Corp., a privately held manufacturer of residential oil burners and related products.

With oil prices doubling in just weeks to $1.40 a barrel, and amid panicked speculation of $50 barrels before long, the very viability of his industry was in question.

In that feverish environment, he gathered his senior management team to make some hard decisions. In search of answers, Beckett and his managers bowed their heads and prayed.

"What we did as a management group was to really commit that whole situation to prayer," Beckett recalled recently. "Our undergirding confidence was that our God is bigger than Mideast oil."

In time, that yielded a consensus: Rather than retreat into a protective crouch, the company would devote more resources to the market. "The natural response would have been to rein things in; our competitors all did. They cut their advertising, they cut their sales efforts. They basically tried to go into a bunker," Beckett says. "But we felt we had to be more aggressive.... We basically said, 'We think this is a short-term situation, and there's a long-term future to what we're doing.'"

The following years did, in fact, bring consolidation. While as many as 400 companies served the niche in the early 1950s, by the mid-'80s only a handful remained to serve the 12 million American homes still heated by oil furnaces.

And R.W. Beckett, with just 3 percent of the U.S. market when young John took over in 1965 upon his father's death, and about 20 percent before the first embargo in 1973, now had a market share of about 80 percent.

"I would say they're regarded as the leader of the market," says Bob Greenes, a prominent fixture in the residential oil-heating industry since 1947, who now runs a Manhattan-based consulting company, Petroconsult.

Resorting to group prayer in the face of corporate trauma isn't for every company, of course. But at R.W. Beckett, where faith has frequently been put to the test, it's difficult to argue with the results that biblically oriented management delivers.


The popular image of born-again Christians is mostly one of crude caricatures. Either they're painted as reproachful intolerants, rigid and constitutionally incapable of enjoying life, or as out-of-touch sentimentalists who won't rest until everyone sees the world as they do.

As with all cartoon renderings, the reality is very different in the case of John Beckett and the company he runs. And Beckett himself, well aware of the polarizing nature of so much Christian fundamentalist rhetoric, has played an active role in recasting the debate.

"I've tried to be careful of what I'll call in-house language," Beckett says. "In Christian circles, we all tend to develop a kind of lingo that basically doesn't communicate with outsiders."

So Beckett has developed his own language to discuss the close and specific relationship between religion-his religion-and business-his business. A company where top managers pray in a group becomes "biblically based"-a phrase that is part description and part euphemism.

He's especially well-aware of the potential for polarization between fundamentalist Christians and those who are distrustful of their intentions because he used to be in the latter camp himself.

His artful straddling of these two generally warring camps is facilitated by the fact that both he and his company are simultaneously humane and built of sturdy, market-tested stuff.

Beckett Corp., after all, annually produces about 400,000 precision-crafted oil burners that are the class of its industry. Everywhere, from the signage in the plant to admonitions peppered throughout the thick employee handbook, the underlying message is the same: This is a company with a moral urgency about quality, service and respect for the individual, so please behave accordingly.

R.W. Beckett, the handbook notes, "is a growing, dynamic company which has achieved respect in our community and worldwide by adhering to such basic Christian principles as integrity, decency, mutual respect and excellence in all that we do-especially the quality of our work." Elsewhere, it speaks of "a wholesome environment where truth, justice and mutual respect are honored."

Owing to a series of unique challenges over more than half a century, the corporate ethos is also one of steadfastness in the face of adversity. That's perhaps best summed up in a quote by Abraham Lincoln which appears below a bust of his likeness in the company's lobby: "The occasion is piled high with difficulty, and we must rise to the occasion....The way is plain, peaceful, generous, just-a way which if followed the world will forever applaud and God must forever bless."

Yet, at the same time, the quietly joyful demeanor one observes throughout the company-from the 50ish women in shorts and heavy work boots who operate forklifts in the plant, to the secretarial staff in the front office-is reminiscent of the industrial-strength peppiness of Wal-Mart greeters. (The joke among newly retired Beckett employees, in fact, is that they can now go work for Wal-Mart.)

Marcia, an 18-year veteran of the company, leads a visitor on a tour of the brightly colored plant, so clean, strikingly attractive and well-organized that even delegations from nearby Invacare Corp. have come for a look.

"You're just a number in a lot of plants, but I don't think anybody ever feels that way here," she says. "It's the atmosphere: I just feel that people here genuinely enjoy coming to work and working with their co-workers. You don't find that in a lot of places."

When the issue of religion in the workplace is broached, she's quick to observe that Beckett employs people of several faiths. "You don't have to be a Christian to work here; it's not pushed. But it's not suppressed, either." Indeed, groups of employees voluntarily gather at their lunch breaks for Bible studies in the company lunch room, a development about which management maintains strict neutrality, neither encouraging nor impeding it. "We just make the space available," says John Beckett.

If people seem unusually happy in their work, Marcia concludes, there's little mystery in it. "I think that's because God shines through them."


That delicate balancing act of harnessing one's spiritual fervor to one's work has long fascinated John Beckett. "The interest in how to combine your faith and your work is just at a very high level in the West right now," he said last year, after returning from a European talk on that topic. At the time, he and a collaborator were struggling over a book manuscript, which aimed to describe his long internal battle between twin callings-business and God. Could the two ever really be reconciled?

By early summer of this year, that effort had yielded a newly published book, Loving Mondays: How to Succeed in Business Without Selling Your Soul. Part business memoir, part spiritual-coming-of-age tale, it chronicles his gradual awakening to a central calling for business.

Beckett describes how, as a boy raised in an Episcopalian home, he didn't come naturally to "born-again" Christianity. He recalls a friend's vain early attempts at proselytizing him. "In a word, what Dave was selling, I wasn't buying. He struck me as narrow, religious and pesky. He seemed to be locked into a formula, and I had an argument to counter every one of his neatly packaged theories."

For this bright young man who would later graduate from the elite Massachusetts Institute of Technology and work as a junior engineer for the company that produces the precision-crafted Lear jet, Christianity "involved faith, and faith didn't square with intellect."

In time, his resistance buckled under the example of his wife's family (his fath er-in-law, an Anglican minister, was president of a theological seminary). "For them, God wasn't aloof. He was personal," Beckett writes. "They approached him as a close friend." Still, he struggled into his late 20s, "rigidly steeled against fully yielding to anything I couldn't analyze and reason my way through. I don't want to become like one of those, I concluded, recoiling from my image of the stereotypical fundamentalist Christian-blindly accepting, dogmatic, unimaginative and just plain not much fun."

For years, he admits to having struggled with the notion of his calling. As he grew into his role with the family company, founded by his father in 1937, Beckett grew increasingly confident that business could satisfy his deeper spiritual needs. Slowly, his chronic suspicion that such a career could never be more than a mere supplement to a more direct spiritual calling-such as the ministry-began to evaporate. The realization was dawning on him that this business-if properly harnessed as a platform for service to employees, customers, vendors and the larger community-could indeed be his primary calling.

In fact, he believes that "people called to business have many opportunities for service unavailable to those who are specifically focused on ministry vocations."

In R.W. Beckett's case, that has included Advent Ministries, a separate company launched in 1979 to help people with troubled pasts-criminal records or chemical dependencies-build a temporary-work record on the way to finding permanent employment.


Perhaps it was because he had first gone through this long internal dialogue that Beckett could later seem so entirely non-threatening, almost pastoral, in his personal approach to his faith. Sitting in his office, which is dominated by his father's old rolltop desk, Beckett has the manner of a middle-aged eagle scout. His gentle movements suggest someone laboring to avoid awakening a loved one sleeping nearby. Through hours of conversation, his gentleness and economy with words never falters, even while he's enunciating some view which, coming from anyone else, would easily sound intolerant.

His intensely peaceful manner-Vice President Bob Cook, who has worked side-by-side with him for 33 years, insists the two have "never had a single argument"-sets an unspoken tone: My role isn't to convince you of anything, but merely to share some truths which I've come to learn and internalize through the years. As one attorney who has worked with him puts it, "he is just one of the most-centered, quiet-at-the-core people I've ever met."


But that's not to suggest weakness. When faced with direct challenges to his blending of work and religion, Beckett has frequently mustered an otherworldly resolve.

Fifteen years after his company's OPEC challenge, Beckett got another wake-up call, this raising the specter that his management techniques might run afoul of federal law. Once more, he was mobilized to action, only now on a national stage.

He was first alerted to the danger by an Atlanta attorney, Dudley Rochelle, who came across a curious entry in the Federal Register in the autumn of 1993. According to the notice, the Equal Employment Opportunity Commission was floating proposed regulations governing religious expression in the workplace.

Because of her background as both a labor-law specialist and someone with close ties to Christian business owners, the Yale-educated lawyer sensed the ominous implications. "Their effect would be to impose a complete prohibition of religious expression in the workplace," Rochelle recalls. "I called it the Religious-free Workplace Act. You really would be at risk to allow any expression."

She sent a fax alert to several people she knew to have an interest in the subject. The warning was passed along to Beckett.

As he mulled it over, Beckett found himself stirred to what he later called "righteous anger" that a handful of distant government bureaucrats could so blithely march into such delicate territory. These rules could create a legal environment in which an after-work prayer meeting or an employee's Bible casually left out on a desk could lead to a religious-discrimination suit against the employer-effectively chilling even the most innocent form of religious expression in the workplace.

Beckett contacted Rochelle, offering to pay half her normal fee to prepare a legal brief on the situation. Then he called an old friend, Mark Siljander, a former congressman from southwestern Michigan and now a public-relations strategist/lobbyist in the Washington area.

"I didn't believe it," says Siljander of Beckett's initial interpretation, that the proposed regulations would ban all types of religious expression. "I told him, whoever told you that is paranoid." After looking into it himself, however, Siljander changed his mind.

Beckett asked Siljander to devise "a systematic effort to mobilize interest groups on the right, left and center." Siljander registered as a lobbyist, and Beckett and a number of like-minded businesspeople put up his fee.

The resulting media wave began with a report on the Christian Broadcast Network, preacher/entrepreneur Pat Robertson's cable network, which reaches millions of viewers and serves as a tip sheet for other media outlets-including those in the mainstream. Dozens of other media outlets would eventually cover the story, building political pressure against the proposal. By June 1994, the Senate Judiciary Committee was hearing testimony on the issue from groups ranging from the Christian right to those on the ideological left, the American Civil Liberties Union and the American Jewish Congress.

Both sides warned of the danger of governmental restraint of workplace religious expression. (After a meeting at EEOC headquarters in Washington on the issue, Beckett noticed a religious-themed poster hanging on a wall as he was leaving. "You know," he gently chided his hosts, "this might have to go under these rules").

In the end, Congress voted by overwhelming majorities in both houses to block the regulations. The grass roots campaign had achieved a stunning victory. And Beckett, who played the role of catalyst, was being launched into a new league.

This high-profile success meant that he would no longer be seen merely as the owner of a profitable, if still mostly obscure, company in a semi-rural corner of the Midwest. Now, he was being noticed in national circles where business and spiritual issues converged. Increasingly, he was being included in conference calls with national figures in the conservative movement such as Bill Bennett, former Reagan administration drug czar and later the best-selling author of The Book of Virtues.

In 1995, ABC News's World News Tonight, looking to put a face to a trend story about companies that incorporate religion into their language and routine, ran a glowing four-minute segment on Beckett Corp. The response was so overwhelming that, to this day, the company still has a sign posted outside its entrance: Sorry, we are not accepting applications at this time." The not is underlined.


With his eldest son, 31-year-old Kevin, set to assume daily control of the company in the next three to four years, the newly minted author, just 60 years old, is preparing for a new chapter in his life. The fragile little company he inherited from his father is now so successful that its biggest problem may be avoiding overconfidence, struggling to remain in what Beckett calls "the servant mode" with customers.

The Beckett family, meanwhile, has amassed considerable land holdings near its headquarters, "and we've thought about building a family of companies, perhaps seven or eight different kinds of businesses," John says. His role would be ensuring a common culture between them.

But for now his biggest goal, he says, "is to get this book into 100,000 hands." After all, it was written with the idea of not merely preaching to the choir, but of reaching the broad, general audience. He hopes it reaches businesspeople and "aspiring" businesspeople, "to tell them that if they have a s ense of integrity or a sense of mission, they don't have to leave a business career behind." At Beckett's prompting, his publisher has taken an extraordinary step in seeing to the widest possible distribution of his message: It has put the entire book on the Internet, where anyone can read it for free rather than having to pay for a copy.

As Christians, he says, "we need to be better at communicating these core values and principals without getting ourselves trapped in the language, because truth is truth. I think that's a telling challenge to the entire church, to find ways to relate to the culture, without turning the culture off. We have a great message. The message is positive, the message is redemptive, the message has hope to it, it's filled with life. But you've got to know how to communicate it without watering it down. It's a tremendous challenge."

Monday, 22 July 2002 10:05

Don't play lawyer, yet

For years, the procedure was routine: A local taxing authority assigned a value to a piece of real estate. If the owner didn't agree, he could file a complaint with a county board of revision, and if he didn't like that answer, he might then take it up with the state board of tax appeals. No need for a lawyer to sign the initial forms until things got into the later stages of battle.

But a decision last year by the Ohio Supreme Court has thrown some curves into the appeals process. It held that real-estate valuation complaints filed by those who didn't own the property constituted unlicensed practice of law.

"That came as news to a lot of companies, because a lot of corporate officers sign these things all the time," says attorney Charles Steines, of the Cleveland office of Jones, Day, Reavis & Pogue.

Relief may be on the way. A bill to correct the situation, already passed by the Ohio House of Representatives, is awaiting action by the state Senate.

In the meantime, companies are advised to exercise extreme care in signing these instruments. "Unless you own property in your name, you should have an attorney file it," Steines says. "Otherwise, the Supreme Court of Ohio could say that's the unlicensed practice of law."

Monday, 22 July 2002 10:04

Turning an FLP into IRA

With the recent soaring popularity of family limited partnerships as a vehicle for passing ownership of privately held companies to the next generation with generous tax savings, tax accountants and tax attorneys say that many clients have inquired about the possibility of marrying their individual retirement accounts to the partnerships. Typically, they've received an unqualified answer: "no."

But in an article in the August issue of the magazine Trusts & Estates, Chris Bray and David Kearns, director of estate planning and an analyst for Sterling, the high-net-worth division of National City Bank, respectively, maintain that "it might be that estate planners have been answering their clients' inquiry too quickly. Maybe there is an opportunity for the family limited partnership and the IRA to work together as an effective estate-planning vehicle."

By using a family limited partnership as an IRA asset under carefully controlled circumstances, they write, "it might be possible for clients to achieve the best of both worlds for estate and income tax-planning purposes."

But the authors urge caution "before exploring this new frontier in estate planning," as they put it. "There are numerous obstacles and controversial issues that surround the successful implementation of such a strategy."

Monday, 22 July 2002 10:02

Start them off right

For most entrepreneurs, the initial path to building a business is smoothed by tapping a network of similarly situated peers from school, family or neighborhood networks. They might not be able to directly help locate financing or good employees, but they can at least serve as a sounding board or traffic cop, pointing in the right direction. But Marty Tarr, the son of a disabled Lakewood plumber, never had the benefit of such sylvan connections.

"The problem for me growing up was, we were all blue collar," he says. "I didn't know any business people, didn't know any white collar folks. No one in my family was white collar."

That didn't stop Tarr, 39, from establishing a computer consultancy which has thrived on the back of its giant technology partners, IBM, Oracle and Computer Associates. With more than 150 employees and independent contractors in the field across the U.S., the company, Independence-based Tiburon Technologies, has been growing at more than 30 percent annually, and expects to finish this year at about $8 million in revenues.

Still, he admits his lack of business savvy did hold him back for years. "I left a lot of mistakes and a lot of money behind," he says. "It stunted our growth, quite honestly. It impacted a lot of things."

Rather than forcing him out of business, this dearth of training merely stoked his desire for acquiring a business education by whatever means he could. This is a man, after all, who attended night school at Cleveland State University for 17 years while building a business. But that was for the technical side of his business, computer programming.

As his company grew to a size and complexity which forced him to return from the field to oversee the entire organization-and caused him to silently scream "help!"-his educational focus gradually shifted to general business issues. He formed an advisory board, to point out his managerial "blind spots." And, he says, "I started focusing on taking business seminars, as many as I could get my hands on. I went everywhere-I became a junkie on education."

Eventually, that led to his selection to participate in the Massachusetts Institute of Technology's elite "Birthing of Giants" program, which convenes selected young entrepreneurs for 12 days of programs over three years with faculty from MIT and Harvard University. Thousands of companies apply, but only 60 are selected each year.

"You walk onto the MIT campus on the opening night of introductions. And people start talking about doing roll-ups and consolidations, $100 million companies doing private placements. I look around and there are four or five people I recognize from magazine covers. And you think to yourself, 'Wow, how did I get here?' It's overwhelming, because they start talking about different issues and concepts that you're hearing for the first time."

Intimidated at first, he quickly grasped that it was just more homework for him to do. And by the second year, he was more comfortable in such fast company.

With that shot of adrenaline, Tarr in recent months has turned his attention to kick-starting a Cleveland chapter of Young Entrepreneurs Organization. Open to founders, owners or controlling shareholders age 39 or younger, of businesses grossing at least $1 million a year, YEO boasts more than 2,000 members in more than 60 local chapters. But until recently, Cleveland wasn't among them.

As the founding member, Tarr kicked things off with a mass mailing to a few hundred people qualified to join, and followed up by inviting prospects to an Indians game in September in owner Dick Jacobs' box. The group now has more than a half-dozen members.

Jacklyn Nemchick, of Propaint Plus in Eastlake, got an immediate glimpse of the possibilities of YEO membership when she attended her first event, where she met a woman who invests in companies.

"I wish I had met her earlier, and maybe I wouldn't have had to sell my position," she says.

Vince Piscetello, owner of VIP Restoration, a $3 million building restoration company based in Cleveland's Collinwood neighborhood, was reluctant to join, since he was already obligated to a number of industry boards. But he was persuaded by what he heard about Tarr. "Marty himself is a big attraction. I did a little checking on him with some people who have known him for a long time, and he's always been a go-getter."

Tarr has to get the chapter off the ground against a ticking clock, however. When he turns 40 next April, under YEO rules, he must matriculate out of the organization, perhaps into Young Presidents Organization or World Entrepreneurs Organization. He plans to have leadership in place by then.

As he looks back, he says, facing his insecurities and getting started in his entrepreneurial education wasn't easy. "The more I learned, the more nervous I got," he admits. But that's really not such a bad thing, he thinks.

"I think to be entrepreneurial, you have to be a little uneasy. I think people who grow up comfortable might not make it."

For more information on Young Entrepreneurs Organization, visit the local chapter's Web site www.yeocleveland.org, or contact Martin Tarr, by phone at (216) 520-3100, or by e-mail at tarr@tiburontech.com.

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