Robert Rosenbaum

Monday, 22 July 2002 09:56

Living well in the strategic zone

From the center of the learning curve of Northeast Ohio’s most successful entrepreneurs, here are the most important lessons I’ve learned about business.

Debt drives growth

A fear of debt essentially translates into a fear of not being able to repay it. While I know people who could stand to be a bit more conscientious in that department, it points to a more serious problem: inability to achieve a return on investment.

An entrepreneur who can’t lead his or her team to an acceptable ROI on any well-conceived project is like a NASCAR driver who has trouble with left-hand turns. Money is the fuel of growth, and if you refuse to borrow, the real issue isn’t financial — it’s personal.

You can’t avoid The Wall

At some point, frenetic start-up energy and charismatic leadership must give way to repeatable processes and sustainable results.

Consider the wall of an obstacle course at those outdoorsy corporate retreats. Some people run up to it at full tilt and scramble right over. Most slow down, size it up, then start climbing — and if they don’t make it by the second or third try, each effort gets a little bit weaker. (In business, others never see the wall until they run into it, and some companies die from exhaustion while hanging onto the top by their fingernails — though I’ve never heard of either actually happening at a corporate retreat).

Climbing the wall demands different skills than running the sprint of a start-up. Don’t fool yourself into thinking that you can avoid the climb.

The big boss only has one job: communication

If you don’t make your ideas and visions clear, nothing else matters. You need to do it every minute of every day — not just through memos and meetings, but through actions, questions and simple walks to the water cooler. If leading communications is the only thing you do, your business will be better off than if it’s the only thing you don’t do.

Everybody needs a manager — even you

You wouldn’t hire a salesman or engineer without assigning someone to help assure that he or she is doing the right work at the right time.

Even CEOs can lose focus and perspective from time to time. But there’s one critical difference: As the owner, you can choose not to be managed and nobody can do anything about it.

Even if you have an outside board of advisers or an internal executive committee, don’t assume you’re allowing yourself to be managed. If you win every argument, make every ruling and agree with every expenditure, odds are you’re really running the show alone — and making some costly mistakes.

Success is in the details

How many businesses really have a product or process that nobody else can duplicate? What makes one restaurant — or insurance company or ad agency — better than another?

It’s the decisions they make, the priorities they set, the details they consider.

Success doesn’t come from having one big idea that nobody else thought of. It comes from doing the same 100 things as everybody else — but better.

Four years ago this month, I wrote my first editor’s column for SBN. This one is my last. I don’t expect anyone to understand how I have personified and become friends with a collection of 30,000 readers; it’s the metaphysical part of being an editor. But I have enjoyed the experience and hope I have been of service.

Monday, 22 July 2002 10:10

From the editor

Introducing a new feature-about fun

By Robert G. Rosenbaum

All work and no play, as they say, makes Jack a dull boy. To help Jack lighten up, I'm pleased to introduce a new feature, which you'll find every month on the last page of the magazine.

Akron After 5 is about what you do after (or instead of) work. To make sure we're highlighting the kinds of places and events that interest you, we've tapped two of Akron's most out-and-about businesspeople to write it.

Each month, Linda Truby, of Above The Crowds Travel & Meeting Planning, and Claudia Bowers, of The Conflict Management & Mediation Center, scour the Akron area to give you a heads-up on what to do when you head out. We're pleased and proud to have them aboard as contributing editors.

Among the topics they plan to cover are: Benefit events, cultural offerings, nightlife openings, weekend outings, high-end retail offerings, special events and short profiles of people in your social circle who are doing interesting things outside of work.

If you have any events you'd like to see highlighted, just send a fax or letter to Small Business News containing details of your event, to the attention of Akron After 5. We can't promise to get everything into print, but we'll try our best.

I hope you'll like this new departure from our regular package of business information. Its goal is to entertain you, help you entertain yourself, and help all of those businesses and institutions throughout Greater Akron that work so hard to show us a good time.

If you do enjoy it, please reserve your thanks for the Akron Summit Convention & Visitors Bureau. As the sponsor for this feature, it's their support that makes it possible.

Now go out and play.

But before you do...

How much are you like a high-performing Entrepreneur Of The Year? Working with Ernst & Young LLP, the founder of the annual Entrepreneur Of The Year program-of which SBN is a proud sponsor-we surveyed all previous Northeast Ohio award winners.

Our questionnaire mirrored a study done late last year among Entrepreneurs Of The Year across the United States, allowing a meaningful comparison between all the best and the best around here.

If you assume that these people have succeeded by developing some of the best management practices, you'll be interested to find out where they get financing, how many times they capitalize, where they ultimately plan to take their businesses and much more. It may give you some ideas on what to think about next.

As for us, we've already moved on to the next Entrepreneur Of The Year feature: full coverage of Akron's players in this year's awards program. You'll find that in the July issue.

Bob Rosenbaum can be reached at (216) 529-8587, or by e-mail at

Monday, 22 July 2002 10:07

Our own approach to summer reading

This is the time of year all the big, national magazines give you their annual “summer reading” issues. I’ve always wondered if what they’re really doing is taking an in-house vacation by packing their pages with fiction that, by definition, doesn’t require fact-checking.

At SBN on the other hand, we never rest in our pursuit of providing you with the most important and factual reading material anywhere. (OK, so if we’re not on vacation, at least allow us a little summer hyperbole).

This issue, though, does have its share of sizzle.

As I flipped through the proofs in the late editing stages of the magazine, I was surprised at the amount of good stuff we’re packing into the issue this month.

Like Senior Editor Teresa Dixon Murray’s cover story on Tom Murdough, the guy who started Step 2 in Streetsboro after disagreements with ownership after his sale of Little Tikes to Rubbermaid.

Murdough is not a man to bite his tongue, which makes for an insightful and fast-reading dialogue that touches on all sorts of touchy subjects—from wrestling with retailers over pricing, to a sideways answer whether he’d like to buy back Little Tikes now that it might be available, to a quick explanation on how, if he succeeds in his quest to buy the Browns, he would manage both organizations.

Associate Editor Diana McGonigal turned in a piece that we’ve labeled “Econ 101.” It takes a basic look at the issues behind a business few ever really think about from the perspective of profit: a driving range. (And the answer to the first question you’ll probably have is 50,000 balls a year.)

Not long ago, Ken Thompson was honored by the Akron Regional Development Board’s Small Business Council as its entrepreneur of the year. Dustin S. Klein, associate editor in our Cleveland office, gives the view of a man who enjoys ruffling the feathers of birds who fly by conventional business wisdom.

So, if you’re still in town to read this column when it’s hot off the presses, I hope you’ll pack this issue of the magazine and take it with you on the vacation you undoubtedly have planned.

Because while none of it is fiction, it sure does make for good reading.

Tune in early

SBN is proud to announce its sponsorship of two business shows on WNEO/WEAO TV 45/49. The shows are Small Business 2000, at the great viewing time of 6:30 a.m. Saturdays; followed by This Week in Business at the slightly improved time slot of 7 a.m.

The first show presents case studies of small and growing businesses; the second is an insightful review of current business events in an interview/round-table format.

We’ve joined Kwik Kopy Printing in Stow and the Burton D. Morgan Foundation in underwriting the programs because, well, we like them and it’s our goal to help our readers obtain useful information from any number of sources.

And if you’re like me—pre-empted from watching TV on Saturday morning by your cartoon-loving children—you have two choices: Record the business shows to watch later, or send your kids back to bed and tell ‘em you’ll call them when Arthur comes on.

Bob Rosenbaum can be reached at (216) 529-8584, or by e-mail at

I'd like to ask you for two small favors. But, first, let me provide some relevant background about the publishing business. Except for a notable few, publications do not live by revenue from subscriptions. The money is in the advertising.

Many charge readers anyway, though the price doesn't nearly cover the cost of selling, and then servicing, each subscription. They do it to show advertisers that people are so devoted to the publication, they'll pay to read it.

It's an accepted business model, but when applied to specialty publishing, it has some weaknesses. Chief among them, from our perspective at SBN, is that it doesn't manage the makeup of the readership. Under the paid subscription model, you develop a product and then see who shows up to read it.

At SBN, we work under the "controlled circulation" model, which essentially starts at the other end. We began with a desired readership-entrepreneurial business owners and high-level decision-makers-and then developed a product to serve them.

Several times a year, we pay an outrageous sum to an independent auditor, BPA International, to go over our circulation list and postal records in detail. That's how we prove to advertisers that the magazine reaches this intended audience.

But how can we prove that the audience is paying attention? By collecting "direct requests" from people like you-signed documents, containing information specified by BPA, that say you have asked to receive the magazine.

We often obtain our direct requests through telemarketing-one of the methods approved by the auditor-and we have it down to a dull but reliable process: For every $1,000 we spend, we know precisely how many direct requests we're going to get.

But this time, we're trying something new; we're asking that you respond in writing using a simple form, which appears on the inside of the magazine's outside cover (in our jargon, it's a cover wrap). The bean counters at HQ are shaking their heads right now; they would have preferred to do another round of telemarketing.

I, on the other hand, am excited at the chance to improve on this ordinary piece of business.

Which brings us to those two favors I want to ask:

First: Think about how you feel toward SBN. All things being equal, would you wish for our success? Or failure?

Second: If you feel any warmth toward the magazine, please take the few moments it will require to fill out the reader survey on the inside of the "cover wrap" and fax it back to the SBN circulation department at (888) 329-7261. We're not offering any incentives. No trips to Europe, no free car. Just the chance to make it a little easier for us to go about our business-which is to help you improve your business.

The box labeled "Subscription renewal information" will be used for only one reason: to collect those important direct requests for our auditors.

The other information is used to help us better focus our content to serve your interests, and to help our advertisers fine-tune their messages-again to ultimately serve your needs. But if you resist such surveys, at least fill in the "Subscription renewal information" box and send it back before the end of September.

Thanks in advance.

Bob Rosenbaum can be reached at (216) 529-8584, or by e-mail at

Monday, 22 July 2002 10:05

From the editor

Over the years, we've developed our own style for understanding the kind of business lessons that can really change a company and its culture.

We tell stories. When you look at them carefully, many of those stories are simply case studies about how a business identified a serious problem and addressed it.

It's an effective method because everybody likes a good story. And as Aesop taught us 25 centuries ago, the morals are easier to understand and remember.

But there is a danger in that technique, too - a risk of universal oversimplification that can do more harm than good. If we tell you that an unconditional money-back guarantee got a high-quality product off the launching pad, it would probably be a disaster if applied to an average product by clumsy management.

Our role in this partnership is to find the good ideas. Can you use them? That burden is on you. We figure you're smart enough.

I've got to admit, however, that I'm having trouble being so dispassionate about this month's cover story - a business that is run, as owner John Beckett says, on biblical principles.

It's a hypercharged subject and there is almost no way to discuss it without raising the most fundamental and hard-wired disagreements people can have.

Take, for example, the language Beckett uses to describe his business. He makes an honest effort to remove what he describes as the polarizing jargon specific to his own religion.

But the ambiguity of his new terminology can't be ignored. Does "biblical principles" refer to the generic set of values upon which Western Society was built: a person's right to proceed through the day in an atmosphere of respect, without fear of being lied to, robbed or murdered?

Or is it simply a euphemism to make the term "Christian-based" more palatable to the many people who don't look to a "W.W.J.D." bracelet for moral direction?

OK, so I've now put it all out on the table. Not only am I unable to be neutral about this topic, I'm more passionate about it than most people I know.

Senior Editor John Ettorre has done his usual exhaustive, sensitive and award-winning work on this character study of a business owner who is not only comfortable that Bible studies take place in the lunch room, but also took on the EEOC to assure that these and other religious expressions remained legal at work.

Just reading about John Beckett, I've come to like and respect him. I'm not tempted to work for him, but I am thankful that he fought Congress to keep his lunchroom free of one more government intrusion (an issue that makes me even more passionate than the many people who have tried to "save" me over the years).

I'm impressed with the success of his business and the sincerity of his views.

But I can't help worrying that his ability to manage two callings (and our decision to bring it to your attention) is going to encourage a whole bunch of owners who are not as well equipped - spiritually and managerially - to handle the thorny issues of, shall we say, a biblically based business.

Then again, the burden to decide is on you. We figure you're smart enough.

Bob Rosenbaum can be reached at (216) 529-8584, or by e-mail at

Monday, 22 July 2002 10:04

Is Microsoft a true monopoly?

The Justice Department desperately wants to prove that Microsoft is a monopoly. I'm not sure it can make the case.

The story starts more than a year ago, with a fairly well-equipped home office and a small, for-profit venture I run in addition to my work at SBN.

Making money, I've learned, requires aggressive, nonstop selling. And that means being able to perform some specific tasks, such as maintaining a database and producing mass mailings to communicate consistently with a targeted group of people.

Which is why, after struggling on my own for months, I put down good money - and plenty of it - to buy Microsoft's market-leading office suite. I figured to put the contacts in the spreadsheet, organize them through the database, write letters to them in the word processor and send them letters and e-mails by passing it all through the information management application.

Complex, yes. But that's why you buy the bundle, right? It's all compatible; it all follows the same logic; it's backed by the largest software developer. How far wrong could I go?

After nearly a year and more than a hundred hours trying to configure the software to my needs, none of it is doing what I'd hoped.

The computer crashes when the database tries to reach into the spreadsheet. The information manager won't send e-mail. The word processor wants to take over all the simple tasks that I already know how to do while turning my work into hotlinks and preformatted letters.

The 600-page user's guide offers only the most cursory answers to questions. Same with Microsoft's technical support. And try to get a computer consultant to help after telling him it's just a single workstation.

Look, I'm not a dumb guy, and while I don't profess to be a computer wizard, I'm not exactly new at using this stuff, either. So why do I feel so lost and alone while my fledgling business slowly chokes on broken promises of productivity from the world's largest software company?

Last week, I'd had enough. I put in a call to a local company - I found their ad in SBN - that sells and installs software.

Instead of telling them what program I wanted, I told them what business functions I needed for it to perform. They set up a time to come to my home office, install and configure the right software to do everything I need, and then provide a hands-on tutorial. Suggested retail: Not much more than I spent on Microsoft Office.

It's too soon to know how happy I'll be with the results. But based on the fact that one phone call has provided more constructive human contact than a year of Microsoft, I'm optimistic.

I'm also sitting here feeling a little bit humbled and stupid. As editor of Northeast Ohio's leading management magazine, I've heard hundreds of executives say, "Pay people what they're worth to do what they know how to do best."

Yet for the last year, I wasted precious resources by listening to Microsoft's implied message that everyone can and should become a computer technician.

So is Microsoft a monopoly? Fortunately for all of us, not when it comes to office productivity.

Bob Rosenbaum, who might be willing to sell a licensed version of Microsoft Office 97, can be reached at (216) 529-8584, or by e-mail at

Monday, 22 July 2002 10:01

From the editor

The cover story in this issue is self-explanatory: The Medical Mutual Pillar Award for Community Service was designed to honor companies that show an exemplary commitment to the community. The program's threefold mission is:

1. To recognize outstanding contributions to the nonprofit community;

2. To foster and encourage an environment of community service among the many businesses served by both SBN and Medical Mutual;

3. To share creative ideas on how companies that may not be rich in resources can still make an impact in the community.

As a fourth element, we have promised to donate proceeds of the program to charitable causes, through the new Pillar Award Fund managed by The Cleveland Foundation. SBN committed to a minimum donation of $10,000. (At the time this column was written, the accounting was far from done. The final figure will be reported in the January issue.)

I was pleased and impressed with the response this program has received in its first year. From dozens of nomination, our judges selected 11 companies of all shapes and sizes that have clearly gone out of their way to make an impact on the community. We told you their names in November, we're honoring them at a banquet Dec. 3, and you'll find their stories in our cover story package.

In the mean time, I want to take this opportunity to thank all the people who have worked so hard to make this effort a success from the start:

  • Medical Mutual of Ohio. As the founding sponsor, Medical Mutual has provided the vision, support and resources to start this program from scratch, which has been no small task. I specifically want to mention Jared Chaney, Linda Libertini and Dave Buckel for their hands-on assistance and counsel. In the time I've worked with them, I've found a genuine sense of commitment to making Northeast Ohio a better place to live and work.

  • The State Bank and Trust Co. and The Hoffman Group, which as corporate sponsors have shown tremendous enthusiasm and support for the mission of sharing stories about good deeds on the part of business.

  • The seven Pillar Award judges.

At SBN, we managed this new project as a true team, without titles or boundaries.

Regional Sales Manager Melissa Gottlieb and her sales team - Angela Berresford, David Cho, Chris Carroll and Scott Garrison - all set aside their ambitious sales goals for as long as it took to bring this program to fruition.

Others who leapt outside of their job descriptions and put in extra hours are Christine Royhab, our network office manager, and, if the title belongs to anybody, de facto event chair. She spent more time than anybody worrying about details, lifting heavy cargo and applying oil to stubborn squeaks.

Also, Renee Doan, receptionist; Lynn Bajec, SBN Cleveland office manager; Debra Andelmo, layout manager; Jim Mericsko, marketing designer; Dustin Klein, associate editor and Tracey Fritz, junior accountant, all of whom jumped in to help without waiting to be asked.

Finally, CEO Fred Koury and Publisher Michael Marzec, both of whom made it easy and enjoyable for us to take our eyes off the bottom line in order to follow the lead of our Pillar Award winners in service to Greater Cleveland.

Bob Rosenbaum can be reached at (216) 529-8584, or by e-mail at

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