1. Weatherhead Centurions
Shearer’s Foods Inc.
Year founded: 1974
Sales growth: 219.98%
CEO: C.J. Fraleigh
Shearer’s Foods manufactures/distributes Shearer’s Award-Winning Snacks and produces salted snacks for private label and co-pack customers.
Shearer’s Foods’ success speaks for itself. In the past five years alone, the Massillon-based snack-food maker has doubled its production, sales, facilities, product offerings and associates. “Shearer perfection in every bag” is the company’s motto, and the product quality epitomized by that phrase has always been, and continues to be, the No. 1 reason for Shearer’s remarkable run of success.
Widely known for manufacturing and distributing its award-winning snack-food products, Shearer’s also manufactures private-label products for select retail-snack customers. The company has amassed numerous awards, not just for its business success and growth, but also for business leadership, manufacturing excellence, sustainability, customer service, new products and community service.
From its humble beginnings in 1974 when Jack and Rosemary Shearer, third-generation owners of Shearer’s Market in Canton, bought a snack-food distributorship, Shearer’s has grown dramatically, both organically and via acquisitions, to become the nation’s leading producer of kettle-cooked potato chips. In 2010, Shearer’s acquired Snack Alliance Inc., one of the fastest-growing producers of branded, contract pack and private-label snacks in North America. That acquisition positioned Shearer’s to serve private-label and contract manufacturing partners nationally with five manufacturing locations.
As Shearer’s has expanded its products and facilities, it has added staff to keep up with that growth. The company currently employs 1,900 — an increase of 300 in just two years — and it continues to hire new workers to maintain its extraordinary success.
In 2011, responding to market demands and new product development opportunities, Shearer’s completed construction of its Millennium Manufacturing Facility, the world’s first LEED Platinum-certified snack-food manufacturing plant. That facility’s development is a clearcut indicator of Shearer’s focus on the future of its industry and on minimizing its environmental impact on the communities in which it operates.
Shearer’s also addresses environmental responsibility via its Energy Management Program, an initiative aimed at producing great snack products while also helping preserve natural resources for future generations. And the company exercises great care in watching over the welfare of its employees, conducting on-site clinics and health screenings to monitor associates’ blood pressure, glucose, cholesterol and body mass index.
In the summer of 2012, Shearer’s began moving into its new corporate headquarters in downtown Massillon. The main impetus for the move was to bring together 150 office workers who had previously been housed at three different company facilities and to benefit from the new energy and efficiencies that would inevitably result from having all of those employes working together under one roof. The new headquarters is in the office building formerly known as Grand Mill Centre. Shearer’s gutted and renovated the four-floor, 40,000-square-foot building, which will now house offices for Shearer’s employees in purchasing, sourcing, supply chain, operations, scheduling, transportation, product development, marketing, sales, customer service, finance, information technology and human resources, as well as the company’s executive team.
Also this past summer, Wind Point Partners, a Chicago-based private equity investment firm specializing in middle-market leveraged buyouts, announced it had signed an agreement to acquire Shearer’s Foods. Wind Point partnered with C.J. Fraleigh, who joined Shearer’s as chairman and CEO. Fraleigh, who most recently served as CEO of Sara Lee-North America, has 25 years of experience in consumer products.
“I’m very excited to be joining the team at Shearer’s,” Fraleigh said. “With the growth of private-label brands and the trend toward outsourcing for branded food companies, Shearer’s is well-positioned to continue its historical growth trajectory. I look forward to working with the company’s 1,850 employees to execute on growth opportunities we’ve identified and continue providing Shearer’s customers with excellent service and consistently high-quality products.”
Wind Point Partners’ acquisition of Shearer’s was completed in November 2012.
How to reach: Shearer’s Foods Inc., (330) 767-3426 or www.shearers.com
1. Weatherhead 100
Magnus International Group Inc.
City: Painesville Township
Year founded: 2007
Sales growth: 2,735.6%
Co-owner, president and CEO: Eric Lofquist
Magnus International is a manufacturer and distributor of unique, natural animal feed ingredients, natural waxes and alternative fuels.
Magnus International Group Inc. bases its growth model on high-volume product development coupled with a high degree of trust in sharing information with its suppliers and customers.
That model is working remarkably well for the Painesville Township-based manufacturer. Magnus has achieved explosive growth during its five years in business. The lion’s share of that growth has taken place since 2010. Up to that point, Magnus had concentrated on converting petroleum-based waste into renewable fuels and all-natural waxes. But 2½ years ago, Magnus started concentrating on creating products for a new market segment — animal feed ingredients — and its business took off.
“By far, the largest segement of our growth has been on the animal nutrition side of our business,” says Eric Lofquist, Magnus’ president and CEO. “The growth on the energy side — renewable fuels and so forth — has been good from time to time, but natural gas prices are low right now, so that makes it hard to grow in that segment.
“However, our growth on the animal nutrition side has been strong and constant. Once we started focusing on the animal feed side about halfway through 2010, we really started to see the change. That’s when we started to grow in a big way.”
Magnus’ leaders attribute their company’s growth to two key factors: prolific new product development and getting those new products to the marketplace quickly.
“The year 2011 was by far our best one in terms of growth, in both real dollars and percentage,” Lofquist says. “We hit a real sweet spot with new product development, which has continued through 2012. Most of these new products are in the animal nutrition area; that’s where 90 percent of our new product development is focused. And we’ve been able to move the products from development out into the market very quickly because of the way we have our business structured with our partners.”
Magnus is uncommonly ambitious when it comes to developing new products.
“We want to have at least one new brand per quarter out in the marketplace,” Lofquist says. “So that might mean we’re working on three, four, five different products a quarter. Some of them won’t make it past the lab stage. Some might not cut mustard out in the market. But we’ve learned that we always need to have a bench of new products we’re working on from the development side.”
The speed with which Magnus is able to move products from development to market is based on the company’s close, partner-based relationship with its customers and suppliers.
“The way we structure our business and our relationships with our vendors and customers, we’re very transparent,” Lofquist says. “We share a lot of information about profitability and cost, and that helps us move to market much faster, as opposed to having the traditional vendor-customer relationship. We’ve modified these relationships to function like partnerships. Even though they’re not partnerships in the legal sense, they feel like partnerships because of the amount of information we share.”
Many of Magnus’ “partners” are versatile in terms of how they work with the manufacturer, serving as both supplier and customer at different times and sometimes in both roles simultaneously.
“We transform materials that are thrown away by food companies — fats, oils, greases — into a number of products,” Lofquist says. “Sometimes we’ll buy some material from a vendor, then make a new product from that material, then sell it back to them as a customer. So it crosses division lines for some of these large companies.
“It’s fun to be able to sit down with them and say, ‘We’ll pay you X for this material. It’s going to cost us Y to remanufacture it into this higher-level product. And then you can take that back to your marketplace or use it in some of your internal products.’ ”
How to reach: Magnus International Group Inc., (216) 592-8355 or www.magnusig.com
95. Weatherhead 100
Foundation Software Inc.
Year founded: 1985
Sales growth: 29.14%
Chairman and CEO: Fred Ode
Foundation Software is the developer of Foundation for Windows construction accounting, project management and scheduling software.
Since Fred Ode first struck out on his own as a programmer in the early 1980s, he has made several decisions in business that have proved successful for Foundation Software Inc., the developer of Foundation for Windows construction accounting, project management and scheduling software.
In 1985, Ode, who serves as chairman and CEO of Foundation Software, spent two years writing the company’s original software application for the construction industry. It took about a year before he sold it in 1988. From there he converted the program to Microsoft DOS in 1990 to run under that environment and then introduced a Windows application in March 2000. The company has been in business for 27 years.
“Our main product is offering software and services to the business sides of commercial, industrial and government contractors — heavy highway, bridge builders, roofers, electrical and mechanical contractors,” Ode says.
One of the biggest turning points for the company was Ode’s decision to upgrade its software application from Microsoft DOS to Windows.
“In 1996, we decided instead of taking our DOS application and doing what’s called an overlay to make it look like it’s a Windows application, we decided to start from scratch and write a whole new application, and that took four years,” Ode says. “That decision is paying off huge now.”
Many of Foundation Software’s competitors took the easy road reworking their existing applications instead of taking advantage of new technology and new ways to design software.
Another crucial point in the company’s past was in 2008 when the recession hit. The market and the company’s competitors were suffering. While the competition was pulling back on advertising, trade shows and cutting staff, Ode stuck to his guns.
“Part of my philosophy has always been to conserve cash,” he says. “I’ve always accumulated cash, and we had a lot of cash in the company. So we didn’t change anything.”
Everything stayed the same with one exception –— Ode decided to increase research and development efforts.
“We kept our marketing and staffing equal and we increased our development, because the idea was when the recession starts to settle down and business starts coming back, we’ll be several steps ahead of our competitors both from a branding and marketing perspective but also in product development,” he says.
At this same time, Foundation Software decided to add a side company called payroll4construction.com, a symbiotic relationship where one feeds off the other.
“We get payroll service companies that want our software, and we get software companies that want our payroll service,” Ode says. “In 2008, the idea was to put our foot on the gas pedal as opposed to hitting the brake. It has paid off huge.”
In the first half of 2011 alone, Foundation Software saw sales revenue increase by 60 percent, and the company added 25 new employees. That success, however, didn’t come without challenges.
“The part that was hurting was our client services,” Ode says. “We have a great reputation in this industry for responding quickly, giving quality answers and for our training, but we fell a little behind.”
It took three to four months to get people up to speed in client services. Customers were used to getting their responses in 30 minutes and it dropped to 90-120 minutes.
“That was a barrier we had to overcome, but we are back down to 30 minutes and we’ve been that way ever since,” he says.
Currently, Ode and Foundation Software are in a great position to continue and improve upon the growth the company has seen.
“Positive cash flow is happiness and we maintain a lot of cash in the business,” he says. “Right now our assumption is we are going to continue growing.”
While being smart with cash has put Ode and the company in a strong position, he says he wants to make sure he keeps his focus on where the business is heading.
“The challenge is not getting too caught up in this current stage of accelerated growth and to be thinking five to 10 years from now,” Ode says. “The idea is to keep adding product that’s specific to the construction industry that has to do with the business side.”
How to reach: Foundation Software Inc., (330) 220-8383 or www.foundationsoft.com
17. Weatherhead 100
Bright Ideas Press LLC
Year founded: 2003
Sales growth: 184.54%
Co-Founder and President: Nancy McGraw
Bright Ideas Press publishes Simple Solutions, providing lifetime mastery through educational materials for K-8 classrooms.
As an elementary school teacher trying to find new ways to help her students remember what they learned, Nancy McGraw tried a different approach. Her approach happened to work and the results she saw were so great she decided to write her approach out for every grade level in her school.
Eventually, she got another teacher outside of her own school to try it as well. The school’s test scores improved dramatically and other teachers and principals in the area started asking if the approach was available.
That’s how Bright Ideas Press LLC, the publisher of Simple Solutions, a series of educational books for K-8 grade levels and subjects, came to fruition.
“It began with a passion for making a difference in the lives of children and still today it’s our company’s goal to try to help students feel confident and successful,” says McGraw, co-founder and president of Bright Ideas Press. “We try to get our books into the hands of as many students as we can across the country.”
In the company’s founding days, that task was easier said than done. A fellow teacher, Kim Dambrogio, who is co-founder and vice president of Bright Ideas Press, agreed to help McGraw publish the original book, but traditional publishers gave them a tough time. So the pair decided to publish the book themselves.
While the company is celebrating its 10-year anniversary in 2013, its growth to this point has been primarily word-of-mouth and the use of free trials.
“We give away free trials and people see that it improves their scores, and they buy it and they tell other people,” McGraw says. “That’s how we’ve grown as big as we are. It’s just word of mouth endorsements from other people and letting people try it for a year to see that what we are saying is the truth.”
The company’s growth has also been aided by the addition of employees who share McGraw’s and Dambrogio’s passion for education. However, that success has been accompanied by growing pains.
“We started as a home-based business and up until a year and a half ago, that’s exactly what we were,” Dambrogio says. “At that time we had nine people.”
In February 2011, the company moved into a commercial space and now employs 20 people.
“A lot of things have had to change,” she says. “It’s been a lot of human-resource type things such as employee handbooks and policies. That was a good transition for us and we had to shift our thinking and so did our staff. That was one of the most difficult things that we’ve faced so far.”
That challenge was enhanced by the fact that neither McGraw nor Dambrogio had a background in business.
“The larger you get the more important knowing things about business and marketing and things like that become,” McGraw says. “We had to learn on the fly.”
Despite any challenges or shortcomings the co-founders had to overcome, Bright Ideas Press has seen steady growth over its 10 years. It has moved from one math book product line to publishing several areas of study and is gearing up for the future.
“Across the country there is a very big shift in education right now toward something called the common core state standards,” Dambrogio says. “Right now, 46 states have adopted the same set of standards for curriculum in math and language arts. That’s a first for this country.
The company is in the process of coming out with a whole new line of math books to meet these standards and is looking to revise and rewrite its English series according to those standards as well. In addition, the company is looking to move away from print books to focus more on digital content.
“Schools and parents are asking for it, so that’s the direction we are going to be moving in,” she says.
The company’s current direction and growth has meant a lot to its co-founders.
“For me it means that the dream that I had initially of trying to help children be successful has multiplied exponentially,” McGraw says. “Hundreds of thousands of students are using our products each year. So it’s been great seeing the dream explode.”
How to reach: Bright Ideas Press LLC, (877) 382-7537 or www.simplesolutions.org
Content Marketing Institute
Sales growth: 1,684.28%
Founder and executive director: Joe Pulizzi
Content Marketing Institute runs the largest international event in content marketing, Content Marketing World, and the leading magazine, Chief Content Officer.
When Joe Pulizzi left a media company some six years ago to found what is now the Content Marketing Institute, he knew the traditional way that companies go to market was changing — and changing big time.
“Instead of mostly through advertising sponsorship of some sort, more and more of those companies were creating their own content, looking and feeling just like publishers, and that’s what content marketing is,” he says. “Basically, it is regular talk about small, big, medium-sized and large companies, saying, ‘Look, in order to get any kind of attention, we need to create valuable, relevant, compelling content all the way through the buyer’s journey.’”
Pulizzi also knew it wasn’t easy for companies to get their own content marketing rolling through websites and social media as well as other channels and they needed somewhere to go for help.
“Content marketing takes a lot of effort; it takes a lot of processes,” he says. “It’s multiple channels; it’s both strategic and tactical. And most companies are really bad storytellers — I mean let’s just put it out there. And that’s why they want to hand it over to someone else. There is such a huge need for education, and we are trying to fill that need.”
The crowning jewel of the Content Marketing Institute, of which Pulizzi is executive director, is its Content Marketing World events, held in cities such as New York, Sydney and Cleveland. The event is the largest in content marketing and grows each year. A Columbus version last year drew 1,000 participants. Pulizzi’s goal is 1,500-2,000.
CMI also publishes a magazine, Chief Content Officer, and does consulting for Fortune 1,000 companies, such as Petco, AT&T and Allstate.
Pulizzi finds some real challenges working with content marketing and larger companies.
“If you are a marketer in a midsized to large company, you are dealing with hugely complex content issues because in a larger organization now, content is the most political beast in the marketing department,” he says.
“It is owned by everybody, there are lots of feuds regarding it but there is no real strategy behind it in most organizations. Most of the time, the content creators in big organizations don’t even talk to each other. It’s just all over the place now. So what we really try to focus on are complex content issues and how as a large enterprise marketer you can really try to figure those out.”
While any size of business can find help at CMI, Pulizzi realizes that midsized or large companies and PR professionals are the organization’s secret sauce.
“That’s where we feel the bigger problems are — and also a lot more revenue because these companies have the money to spend on this,” he says.
If you haven’t guessed it by now, Pulizzi feels very passionate about content marketing. He takes the Content Marketing World stage wearing a burnt orange three-piece suit. It gets the audience’s attention that it might be wise to hold on to their seats for his message.
“You’ve got to be a little bit different from the rest, and that could be the things you wear, the colors you like, things you do,” he says. “And those are the people at least in our industry who are getting the most attention. They do things a little bit differently.”
That’s why good, creative, compelling content that answers customers’ questions serves to differentiate a company from its rivals.
“Why the heck would they spend time with you?” Pulizzi says. “There are 10 million other resources where they could go to but what makes yours the best?
“If you’re not offering compelling content, you had better start investing time to both have an understanding of technology but more importantly to understand what your content strategy is.”
His advice is a three-pronged approach.
“Let’s say, you want your website to get found in Google — that’s search engine optimization. You want to drive online leads — that’s lead generation. Or you want to be successful in your social media efforts.
“None of those three start without first a good content marketing strategy. Because what are you going to have to say? You have to have something compelling to say to drive your business objectives.”
How to reach: Content Marketing Institute, (888) 554-2014 or www.contentmarketinginstitute.com
When voters in the Cleveland school district approved its first operating levy in 16 years, it wasn’t an anomaly. It was recognition that Cleveland is and has been in a progressive mode — and the region is in motion as new projects are being planned, developed and launched.
Just as a first-ever coalition of business, labor, civic and clergy groups joined to support the schools, area companies have been hard at work to ensure this revival of Greater Cleveland.
Entrepreneurs have been innovating. Economic development has been on the front burner. Projects have been completed — such as the Horseshoe Casino. The Cleveland Browns have a new owner. And towering supports dot the downtown sky as the new Innerbelt Bridge starts to take form.
On the following pages, you’ll find the names, facts, figures and stories of 126 area companies that have also contributed to the resurgence by accomplishing outstanding percentages of growth. We recognize them for their contributions to our communities and their demonstrated strength of the entrepreneurial spirit in our region.
For instance, Magnus International Group Inc. grew an amazing 2,736 percent in the past five years. Most of that growth has taken place since 2010. Magnus at that point started concentrating on creating products for a new market segment – animal feed ingredients — and its business took off.
When Joe Pulizzi left a media company some six years ago to found what is now the Content Marketing Institute, he knew a change was in the air for marketing. The digital world was facing companies, content was king, and they had to get on board. CMI has grown 1,684 percent in the past five years, largely through its events, including Content Marketing World.
The Weatherhead School of Management at Case Western Reserve University and the Council of Smaller Enterprises are proud to honor the Weatherhead 100 class of 2012. Here are the class members.
“E Pluribus Unum” — it’s the motto of the United States of America found on our national seal and all coins currently being manufactured. Its translation from Latin means, “out of many, one.”
It’s no surprise that the United States adopted this motto in 1776 upon its founding as a nation — the forefathers took 13 separate colonies and created one United States to which we continued adding states and territories over the years.
The same is true of the American people themselves. They came from many countries but together those many became one people, one nation.
I didn’t set out to write a history lesson when I began this column, but as I was reflecting on unity, I came to understand how relevant these words were for entrepreneurs or, truly, any business leader.
Out of many, one
A company is best when its employees come together with one another to develop unity.
There must be mobilization around a central theme or an organizing unity of purpose — a mission statement, an idea or culture.
Since no one is exactly the same, unity by its very nature demands diversity. The more diverse the different members of an organization may be, the greater the need for union and harmony.
Diversity does not mean division any more than solitary means solidarity. Nor can unity tolerate division. Because of this, the important idea seems clear enough: Diversity in unity strengthens, but division from unity weakens.
A truly successful business will only develop when this idea is taken into account. You have to find the delicate balance between personalities, work styles and ideas to unify a diverse group of individuals and strengthen an organization.
Good leaders will not want to surround themselves with “yes-men,” or those who are unified with the leader on every subject possible. Diverse viewpoints and ideas will only serve to strengthen an organization.
The value of a dissenter
Great leaders can also recognize the benefit of having at least one person surrounding them who can play the devil’s advocate. That person will present a differing viewpoint to the one commonly agreed upon.
This is not to say that a person should continuously argue for argument’s sake, but a confidant who can push and needle an issue is of great importance. It forces one to dive deeper into one’s views on a subject to ensure that it is the best route to take and either defend the position or discard it in favor of another.
This devil’s advocate must not cross the line as a negativist. However, when that occurs, that person will be a division from unity and weaken the institution.
This guidance can come into being during many different times in an organization’s life. When an entrepreneur brings in business partners, they all must work together to reach the unity to become one organization.
When a start-up discusses a corporate strategy with angel investors or future buyers, they must work together to find harmony and reach an understanding that strengthens the business or brand.
When an organization puts a board of directors in place, it is seeking counsel from a diverse group of individuals who can mobilize around a central theme of bettering profits or extending a company’s reach.
But these ideas extend even deeper into an organization. A group of employees may find value in them during a meeting as they attempt to implement a social media strategy or discuss internal purchases.
The best meetings will come out of the fact that diverse employees with differing ideas can unite and strengthen an organization. ?
Thomas M. Nies is the founder and CEO of Cincom Systems Inc. Since its founding in 1968, Cincom has matured into one of the largest international, independent software companies in the world. Cincom’s client base spans communications, financial services, education, government, manufacturing, retail, health care and insurance. Go to tomnies.cincom.com/about.
Magnus International Group announced that its founder, Eric Lofquist, has been named the Ernst & Young National Entrepreneur Of The Year 2012 Distribution and Manufacturing Category Award winner.
The Ernst & Young Entrepreneur Of The Year Award is the country’s most prestigious business award for entrepreneurs. The award encourages entrepreneurial activity and recognizes leaders and visionaries who demonstrate innovation, financial success and personal commitment as they create and build world-class businesses.
Alliance Solutions Group, a full-service staffing and recruitment agency with offices in Cuyahoga, Summit, Portage, Franklin, Lorain, Mahoning, Lake and Wyandot counties, appointed Mark D’Agostino as president of Alliance Solutions Group of Akron. D’Agostino is opening a new staffing “hub” facility in Akron that offers the company’s full complement of staffing and recruitment services from all nine of its business units. Previously, Alliance Solutions Group operated a smaller office in Akron that only served the manufacturing and warehouse industries
Medical Mutual recently announced that Kathy Golovan has been appointed executive vice president and chief information officer. Golovan will be responsible for the information technology division including IT infrastructure and development.
Before joining Medical Mutual, Golovan was a tax consulting manager at Ernst & Young. She joined Medical Mutual in 1998 as a tax coordinator. In 1999, she moved from finance to legal.
Kaiser Permanente Ohio recently announced that Dr. Nabil Chehade has been named the next president and executive medical director of the Ohio Permanente Medical Group (OPMG), the exclusive physician network for Kaiser Permanente members.
Dr. Chehade began his new role Jan. 1 and will lead more than 200 health care clinicians and professionals who work for OPMG in 15 Kaiser Permanente medical offices in Northeast Ohio.
C.C. Hodgson recently announced the addition of two architects, Mark Duluk, senior design architect, and George Gatta, design architect/project manager.
Duluk is a graduate of Harvard University and has more than 20 years of experience in master planning and design.
Gatta returns back to working with Hodgson where he had previously worked on the master planning and designing of several senior living campuses.
Interlake Industries Inc. announced that Lisa M. Habe has been appointed chairman of the board of directors. The corporation specializes in short- to medium-run metal stampings with facilities in Ohio and Florida.
Western Reserve Partners announced that David P. Mariano has rejoined the firm as a director. Mariano will focus exclusively on building Western Reserve’s buy-side advisory practice. ?
Domestic mergers and acquisitions decreased 28 percent from October to November, according to S&P Capital IQ, but the transaction values made up for the lack of volume by increasing 21 percent across the same period.
The strong purchasing power capabilities of both financial and strategic buyers, aging baby boomers needing to transition their businesses, and financials needing to exit aging portfolio companies are positive signs for the M&A market. Despite these factors, the future seems as murky as ever.
The fiscal cliff is rapidly approaching and we may have already taken the proverbial plunge before you even read this story.
Regarding corporate buyers, Lincoln Electric Co. snatched up three businesses from ITT Corp. near Charleston, S.C. Applied Industrial Technologies Inc. acquired HyQuip Inc., a 19-employee company that is a distributor of hydraulic, rubber and plastic industrial hose and tubing. Nordson Corp. purchased certain assets of Kodama Chemical Industry Co. Ltd., a licensed distributor for Nordson’s EDI business in Japan. Nordson acquired EDI last June.
Cedar Fair LP, which owns the Cedar Point amusement park, sold Knott’s Soak City in California to SeaWorld. It will become SeaWorld’s third aquatic park in the United States.
Eaton Corp. completed the acquisition of the electrical equipment supplier Cooper Industries plc for $13 billion.
The Riverside Co. made a total of four acquisitions in November. It acquired Digital University, which is the sixth add-on since 2007 to OnCourse Learning. Riverside also purchased Learning Seat, an Australian-based provider of e-learning courses. The other two companies are in the transportation and health care industries.
Finally, Sherwin-Williams Co. announced plans to acquire Mexican competitor COMEX for $2.4 billion.
ALBERT D. MELCHIORRE is the president of MelCap Partners LLC, a middle-market investment banking firm. He is also a director on the ACG Cleveland board. For more information on MelCap Partners, please visit www.melcap.co. For more information about the Association for Corporate Growth, please visit www.acg.org/cleveland.
Deal of the Month
Parker Hannifin Corp. is going out with a bang in 2012 as it completed two acquisitions with combined sales of $215 million in November, earning them the Deal of the Month award.
The first acquisition was Velcon Filters from the private equity firm, The Sterling Group.
Velcon is a niche manufacturer of filtration systems with 300 employees.
Parker’s second purchase was Houston-based PGI International. PGI is manufacturer of specialized, high-pressure flow control components and systems.
PGI has 550 employees and approximate sales of $100 million. This marks Parker’s 13th M&A transaction in 2012. The company has increased its annual dividends paid to shareholders for 56 consecutive fiscal years, among the top five longest running dividend increase records in the S&P 500 index.
We are barraged each day with opinions on the economy, jobs, health care costs and a host of other topics that can affect consumer confidence. Information is plentiful, but it is often contradictory, leaving people to decide who and what to believe.
As business leaders, you must face not only the realities of the business environment in which you operate but also the mindsets of employees and customers.
As the economy shows signs of improving, they look to see if you’ll react. But leaders often rely on others, and being fearful of making the wrong move, they wait for the percentages to improve and for more certainty to prevail. Even the optimists are finding it challenging to break out of the pack and do something bold.
Emergence depends on factors
The reality is that not every sector will enter or emerge from a recession at the same time. It is important that you understand your market and where your business is in the cycle. If you don’t already have a list of leading indicators, then you need to develop one.
Demand the best information from which to make decisions regarding your business. Rely on facts, trends and data to help make better and timelier decisions. Act quick, be decisive, and don’t be a naysayer. Focus on what can be done versus what can’t. Motivate and energize your organization and set goals to break out and show what can be accomplished.
Being an early mover can give your business a substantial competitive advantage. When you see signs of enduring strength, you need to lead changes in your organization to improve the mood and atmosphere, to build confidence that things are going to improve, and to implement the plans you have developed.
Time to take action
Here are some steps you can take:
? Leverage your competitive advantage
? Take price increases in key segments while locking in cost in others.
? Get aggressive in marketing and selling efforts
? Expand into new markets or launch new products
? Invest in training staff and hire high-quality people
? Make acquisitions of products or businesses
? Invest in incremental capacity to enable growth
? Create a contagious atmosphere where people can prosper and customers can enjoy themselves
These actions within a company become contagious and can foster creativity and risk-taking. When done effectively, these actions will position your business for success.
Setting the tone
The way you think and talk about your business, the market and the situation you face will set the tone for the organization. Your actions and words can be the difference between breaking out or being a laggard.
Do you focus on the problem or the solution?
Do you think about the opportunities to grow share or focus only on retaining customers?
Have you ever noticed that, during tough times, the sales gap between the A and B/C players widens? Their attitudes shift and you start hearing excuses from B and C players as to why they “can’t” get sales.
Even when things start to recover, the A players will distance themselves even more from the others. When you go on sales calls with the A players, they acknowledge the circumstance with the customer but will quickly focus on what should be done to make the best out of the situation.
As leaders, we can set this expectation across the organization. It’s a mindset and an attitude. Do your part to create an environment where people can be creative, develop plans and execute with passion so they can win.
Tony Arnold is founder and principal of Upfront Management, a St. Louis-based management and executive consulting firm. He can be reached at (314) 825-9525 or firstname.lastname@example.org.