But where others may have turned bigger marketing efforts or a beefed up sales staff, Roberts turned somewhere else. He turned to his faith in God.
I said, Lord, this is your business, recalls Roberts, who shared his views on spirituality in the workplace at an Employee Resource Council breakfast in December. Whatever you want is what I want.
As if his prayers were answered, over the next few weeks Roberts landed a handful of new customers. One spent $250,000 with the company during a 12-month stretch.
Roberts says he isnt trying to make a case for increased sales through prayer. In fact, he bristles at the notion of merging spirituality and business as a kind of lucky rabbits foot.
He merely believes the religious principles and ethics at the cornerstone of his 56-employee business have created a positive environment that led to his companys 5,000 percent growth during its first six years and the ability to land heavy-hitting clients including IBM and Sun Microsystems.
Roberts wasnt sure at first whether this mix of spirituality and business sense was going to work and readily admits there was much prayer and soul searching before his attempt to create a faith-based business.
I really didnt think it would be possible to incorporate my personal faith far and away the most important thing in my life with my business, he says.
His efforts ultimately paid off, and several studies show Roberts is not alone in the quest to merge religious beliefs and business. A Business Week survey found 48 percent of workers in the United States had talked about God at work within the past 24 hours, while the Fellowship for Companies for Christ International reported there are 10,000 business-based prayer groups that meet regularly across the U.S.
Then there is the nations sixth largest Pizza Hut and Taco Bell franchise, in Austin, Texas, which cut employee turnover in half by hiring a company chaplain.
But making religious beliefs part of the mission statement doesnt come without its own set of legal risks, particularly if employees feel pressured to conform to certain beliefs to be hired or promoted. Roberts, though, has found a way to integrate his spiritual beliefs with his management style without making his workers uncomfortable. In fact, just the opposite has happened. Employees describe the atmosphere at Grace as safe and say it is the best place they have ever worked.
Heres how Roberts did it:
When making religious principles part of a companys culture, Roberts says it is important not become an evangelist who tries to sway employees to a certain religious viewpoint. Instead, he suggests business owners focus on integrating religious teachings about morals and ethics into the daily operations of the business.
Its not my place to preach to my employees, says Roberts. In my company, were incorporating biblical teachings into secular terms. We are creating an ethics-based company.
Share your philosophy
It is illegal to weed out qualified candidates or fire people simply because their morals do not seem to fall in line with the company. Instead, Roberts explains to potential hires the ethical philosophy behind the company so candidates can decide whether they fit into the culture.
After a lengthy interview process, new hires are expected to sign off on a corporate constitution pledging to uphold the values of the company and making sure their co-workers do the same.
Religion doesnt come up, explains Roberts. But the issue of integrity and ethics comes up a great deal and its very thorough and multilayered. We ask them to read and make a commitment to our corporate constitution and make it very plain to them that if they arent prepared to do that, this is the wrong kind of company to work for.
Lead by example
When creating a faith-based business, Roberts says it is important to show employees that the company culture and values cannot be swayed by money. Since the inception of his business, Grace has made it a moral rule not to do business at the same time with companies which are in direct competition in the same niche.
His rule was tested when he had to walk away from a potential client poised to spend $250,000 to $500,000 with Grace simply because he had already been contacted by one of the mans competitors.
I walked away from it because of a potential conflict of interest or ethics, explains Roberts. The traditional world says thats absolutely stupid. But what went on to happen was the company who we had first been talking to, which hadnt spent much money with us, ended up spending a lot of money over the next three years.
If you are going to make religious principles part of business, it is vital to allow your employees respective religions to be important to them. That means being flexible when they need days off to celebrate religious holidays and not playing favorites among different religious beliefs.
Roberts suggests business owners thoroughly research Equal Opportunities Commission guidelines before trying to merge religion with the workplace so they do not expose themselves to legal risks.
I think its prudent for someone to be aware of the EOC requirements, because if you dont know what the rules are, you cant live within them, he says. You cant really endorse (religious beliefs) and you really have to be respectful with people who choose not to be interested or not to buy into something.
How to reach: Grace Software Marketing Co., (216) 321-2000
Jim Vickers (email@example.com) is an associate editor at SBN.
By 1900, nearly 400,000 families had filed for land under the law. But many homesteaders struggled financially and were forced to sell their land to wealthy landowners, who, in turn, built the huge ranches that pepper the West today.
Being first doesnt guarantee prosperity or even long-term success. In fact, a similar scenario is unfolding today on the Internet.
It shouldnt surprise anyone that Amazon.com wasnt the first online bookstore. That distinction goes to Bookstacks Inc., founded in 1992 by Clevelander Charles Stack (see SBN April 1999).
While Stacks site was mildly successful, it didnt have the financial backing of Amazon. In 1996, Stack sold his company to Cendant Corp. for about $4.8 million and launched a new Internet firm, Flashline.com, which sells digital software components.
Cendant added Bookstacks to its Internet mall operations, hoping to gain ground against not only Amazon, but the growing field of online bookstores that suddenly included traditional brick-and-mortar giants Barnes & Noble and Borders.
Last year, Book Stacks marginal profitability caught up with it and Cendant put it on the block. For nearly nine months, the company sought a buyer who could integrate Bookstacks into its online operations.
Those efforts failed. So with little fanfare, Bookstacks closed its operations on Halloween and quietly faded away into the darkness of cyberspace.
A few days later, on Nov. 3, Cendant sold Bookstacks URL www.books.com to Barnes & Noble. And though neither party will say exactly how much money changed hands, its been reported the URL fetched between $4 million and $7 million.
The lesson of Bookstacks story is simple: When planning a Web initiative for your business, dont worry about being the first one up and running. Odds are, someone, somewhere, has already thought of your great e-business idea. And theyve probably put out their shingle on the Net.
In the big scheme of things, the strategy of getting there fast is losing steam. If you look around the Web, the notion of broad-based, all-encompassing Web sites and portals is quickly being replaced by specifically targeted portals for niche markets.
Its not much different from traditional marketing define your audience, focus your energy and resources, design your initiative, then implement your plan.
Its as simple and as difficult as that.
As for Bookstacks, its fate was similar to that of many of those original homesteaders who had great ideas and a vision to build a home for themselves in the West. They may have been quick and claimed the land first, but a lack of finances and inability to adapt led to their downfall.
Whats more, future generations will forever associate books.com with Barnes & Noble. And except by a select few, Bookstacks history will be forgotten, much like those original homesteaders.
If youre worried about your companys e-solution, the bottom line is this: Spend your time wisely and develop a strong, strategic Web initiative that wont be outdated by the time you employ it. And, most important, dont worry about being first.
Instead, worry about being the best.
Dustin Klein (firstname.lastname@example.org) is editor of SBN.
Last month, I argued that smaller technology-based firms are critical to a regions economic well-being. Northeast Ohio performs poorly in creating and supporting the entrepreneurial breed that travels in the high-tech fast lane.
The long-term implications of this shortfall are significant and sobering.
To reverse this deficiency, four areas are worthy of consideration. Admittedly, none on its own is a silver bullet. But, if they are recognized as important issues to be addressed and then actively supported, perhaps the sluggish scenario for smaller technology-based firms here can be improved and kicked into high gear.
State, regional and local governments
For high tech overall, and especially for smaller technology-based firms, governmental administrations have done little. From the governor in Columbus to the mayor in Cleveland, high tech of any stripe has languished as a low-priority agenda item.
This oversight is unacceptable, since singly and in cooperation, governmental agencies can and should do more. At the outset, they must accept the principle that smaller technology-based firms are often the engine for regional economic growth.
Two areas for governmental attention are singled out for these companies, namely low-cost industrial space for start-ups and programs to help obtain financing for ongoing operations as they grow. Start-ups often struggle to locate affordable space for their initial activities, when their credit standing and record of accomplishment are nonexistent and they face a questionable future.
Government assistance can lower entry and operating costs, and thereby shoulder some of the risk.
In other regions where smaller technology-based firms have thrived, major universities play pivotal roles.
But not here. Case Western Reserve University, by far the largest local university presence with respect to research activities, should re-examine from the ground up the many ways it facilitates or obstructs the creation and subsequent support for aspiring technology-based entrepreneurs.
The university should analyze how it can do a better job to bridge the sizable cultural differences between its academic environment and the entrepreneurs. Incentives, time horizons for decision-making and project completion, value of research transformed into marketable products and risk tolerance remain divisive issues.
An important first step is the encouragement the university provides to a staff professor with a creative high-tech idea who wishes to leave academia and start his or her own business. This is a difficult transition under the best of circumstances.
The university can encourage the professor-soon-to-be-entrepreneur by viewing this process not as a loss to the university but a gain for the community. It should simplify and accelerate the path by which intellectual property migrates from academic research to innovative industrial products.
The university should also be swift in its actions and willing to incur some risk to expedite the transition.
Smaller technology-based firms confront banking institutions with singular challenges. This reality is particularly true for Cleveland-based banks traditionally attuned to heavy industry, such as steel-making and auto assembly. Banks generally are not eager to deal with small operations of any kind.
The discomfort level rises sharply if the borrower makes and markets high-tech products (which lending officers do not understand). The situation is aggravated further when banks deal with Internet or software firms whose assets are often limited to intellectual property.
The banks here, in league with the state, might adopt an approach already in place in more than 20 states. A capital access program can increase the number of smaller companies that obtain working capital. Contributions into a pooled fund are made jointly by the state, the lending bank and the borrowing firm.
If the borrowing company defaults, the fund will reimburse the bank for much of its outstanding loan. The banks exposure is minimal.
Local smaller technology-based successes
Although the numbers are relatively low, Northeast Ohio does boast several entrepreneurial technology-based success stories in the past decade. STERIS, Thermagon and Gliatech have established competitive positions in their respective market niches.
I suspect that little effort has been expended to publicize their accomplishments, especially as a group. This omission is a serious oversight on the part of the community. The awareness that high-tech successes have been achieved in this region can serve as a powerful Northeast Ohio magnet for entrepreneurs from here and elsewhere.
As a minimum, the message should document these accomplishments within a brochure and online communications for target audiences locally and outside Northeast Ohio.
The message should boldly assert that a number of local high-tech entrepreneurs have established profitable, growing firms here.
Herb Kleiman (email@example.com) is president of Kleiman Associates, a Shaker Heights-based firm that provides marketing/communications to medium/smaller technology-based companies.
The case was eventually settled and B&N resumed online sales, but the implications of the action cant be overlooked.
Everybodys suing everybody on the Internet these days, says J.T. Kalnay, an attorney at Ulmer & Bernes e-law group.
That, Kalnay warns, is only going to get worse as business owners stumble over each other in a rush to protect the information, software and processes they use on the Internet to conduct business. Amazons technology essentially remembers customer profiles when they return to the site and allows them to purchase merchandise with a single click of a mouse without the burden of filling in a new profile every visit.
Ironically, it wasnt that long ago (the 1970s) when the courts ruled that software was not patentable. But in a sweeping change of opinion, the courts reversed themselves in 1998, saying materials of the digital industry are drastically different these days and developers deserve some form of protection.
Amazons recent litigation is just one case in point. Another comes from a more unlikely source, John Benson. Benson isnt well known in most circles, but he lays claim to the creation of fantasy sports games. Approximately 15 million people nationwide participate in fantasy games, from rotisserie baseball to fantasy football to fantasy hockey.
A few decades ago, Benson developed the Official Constitution of Rotisserie Baseball. On Feb. 4, he shocked the fantasy sports world with an unannounced FedEx package ordering Ron Shandler, head of www.baseballhq.com and organizer of the largest baseball fantasy draft in the nation to cease and desist his activities with all fantasy sports leagues.
Shandler was also ordered to remove all references to Bensons rules or any modifications of them from his site. In the lawsuit, Benson claims full rights to the concept of fantasy sports, much in the way Amazon asserts its one-click technology cant be duplicated by anyone else without paying royalties. Bensons case has yet to be settled.
The issue of who owns what online is certainly not cut-and-dried, says Nicole Vickroy, also an attorney with Ulmer & Bernes e-law group. While the information contained in databases is not patentable, the databases themselves are. Courts have held compilations of information are analogous to the phone book, which cant be patented.
Says Vickroy, You cant just post whatever you want on the Internet. Right now, you better get permission first.
But before you start pulling down every nonproprietary piece of information off your companys Web site, there have been some clarifications of what can be patented.
Specific machines, such as hand-held personal digital assistant devices that beam information to other machines, are patentable, Kalnay says.
When in doubt, Kalnay suggests checking with your attorney or contacting the U.S. Patent and Trademark Office. And, though the laws remain ambiguous, the message is clear, says Kalnay.
Basically, if youre doing something on the Internet, protect yourself.
How to reach: Ulmer & Berne LLP, (216) 621-8400
Dustin Klein (firstname.lastname@example.org) is editor of SBN.
The inventory sits in the warehouse collecting dust when it’s supposed to be collecting money for your business. Obviously, it’s not moving the way you had planned, but is it time to cut your losses and liquidate it?
“It’s a question of do you need the cash for something else,” says Alice Magos, an analyst for CCH Inc., a business consulting firm. “If you have a large investment in your inventory and it’s not turning, then the costs are significant. When you have money tied up in inventory that’s not moving, that’s money that isn’t available to do other things, like pay bills.”
A common mistake is waiting too long to unload the inventory. You’ll be desperate and won’t be able to get a good price.
“Keep good records and know at all times what your turnover is, that way you can head off problems before they become monumental,” says Magos.
Try to induce regular customers to buy your inventory with special sales. You can also try to get vendors to take back product that doesn’t sell.
“Before buying something, get an agreement that they will take back obsolete or slow-moving items,” says Magos, who also gives business advice through her “Ask Alice” column on CCH’s Web site. These agreements are usually discounted from the price you originally paid and have handling costs factored in but it’s still better than having a warehouse full of products that aren’t selling.
When all else fails, it’s time to liquidate. Until recently, the only way to do this was to call a local liquidator and take the best offer. However, with the Internet, sites like Tradeout.com allow you to liquidate the inventory yourself, and display it to a worldwide audience. Users pay a $10 listing fee and a 5 percent commission to the site on a sale, and online logistics help get your product where it needs to go.
By selling on the Web, you are also less likely to be flooding your own distribution area with marked-down product, and less likely to have a competitor grab your products to use against you later.
“You don’t want to dump the stuff in your own area if possible,” says Magos. “The Web opens up a broader base of buyers.”
Regardless of how you liquidate, if you have products that are time sensitive or have high mark-ups, it’s a lot tougher to get rid of the stuff, so plan accordingly.
Diluting your brand name having products with your name on them sitting in discount bins or appearing in clearance advertisements can be a problem, but if you need the cash, worry about the brand later.
“If you’re pushed to the wall, don’t worry about down the road,” says Magos.
Decisive action is better. Try to avoid the problem in the first place by having good inventory management and good records. Know what is selling and keep the right stuff in inventory.
Cash flow management is key to not getting into this kind of trouble.
How to reach: Alice Magos, www.toolkit.cch.com
Todd Shryock (email@example.com) is SBN’s special reports editor.
Adaptability has never been more important in business, and the decision-makers that recognize and address changes before its too late can help write the rules for the next chapter in workplace trends.
The American Society for Training and Development identified eight key issues in three distinct areas of business that owners say are at the top of their lists, and compiled them in a report, The ASTD Trends Watch. The report highlights critical forces shaping todays workplace and prognosticates how those forces will affect tomorrows workplace.
For more information on the report visit the ASTDs Web site at www.astd.org.
Changing competitive landscape
Demography. Population shifts will transform the workplace as baby boomers age and racial and ethnic diversity increases.
The race for talent. Theres a war afoot for the very best and brightest. Its not about money, and only the creative will succeed.
Technical skills. Continuous employee education programs are necessary to keep pace with rapidly changing skill set needs.
Thriving and achieving growth issues
Cultural due diligence. The cultural make-up of the work force is changing as merger and acquisition mania sweeps across all levels of business and industry. Globalization is here and will grow.
Leadership. Do you know who will lead your company tomorrow? Start grooming employees now to assume key leadership roles.
Emerging requirements for governance
Intellectual capital. How can you measure or report on this all-too-important intangible? Do you even recognize it within your company?
Income inequality. The gap between high-income and low-income workers is growing. Are salaries competitive within your company? If not, what are the implications as the gap widens?
Public policy. How can changes in government regulations affect your work force development?
Dustin Klein (firstname.lastname@example.org) is editor of SBN.
Youve attended every seminar ever given and read every book ever written on how to motivate and increase your employees productivity.
They seem eager and dedicated, but when they walk through the door, they just deflate. Walking through that door may actually be your problem.
Traditional (read: old) buildings do little promote the health of either employees or the environment. Thats why many business owners have begun adopting green building philosophies.
Its building design and construction that takes environment and human health into account, that minimizes the impact of buildings on the environment, says David Beach, director of EcoCity Cleveland, a nonprofit organization that looks at rebuilding communities from an ecological basis. It is also a building that is healthy and delightful for the buildings occupants.
Beach says those who have built green office buildings have discovered that productivity dramatically increased. That can be attributed to improvements such as better lighting and better comfort.
Its a better feeling building, he says. They tend to tend to be more open to the outdoors. Theres more natural daylight. People feel better in those buildings and they work better.
Taken as a whole, Cleveland isnt among the leaders in green building design. But the buzz is growing among local contractors and architects, who have learned to embrace the concept and tout the benefits.
Sometimes these green buildings may cost a little more to design and build, but theres so much of an increase in productivity, the payback is almost immediate, Beach says. And then the building continues to pay well into the future.
You dont have to build a new structure from scratch to receive the benefits of green philosophies. But you do need to be careful. One mistake many owners make is applying a Band-Aid approach trying to fix 10 little things instead of concentrating on one larger area.
Beach says that results in small incremental improvements, at best.
The key is to think in terms of whole systems and not just one part of the building or the other, he says. You tend to get your biggest savings by taking a comprehensive view of how a building works. This is not far out stuff. This is off-the-shelf technology being used all over the world that can make these buildings dramatically better and improve their performance. So its not really esoteric kinds of things.
And its not as overwhelming as one might think. Beach says there are many ways to employ green strategies with existing buildings, and when current systems reach the end of their life spans, building owners should consider the green approach. Spending a little bit more now on green windows might mean replacing the current heating and cooling system with a much smaller one when the time comes.
If youre going to do a building, I think youre crazy not to consider these ideas, Beach says. Because by doing them, youll get a better building, save a lot of money and youll also feel better about doing something good for the earth.
How to reach: EcoCity Cleveland, (216) 932-3007 or www.ecocleveland.org/b/index.html
Daniel G. Jacobs (email@example.com) is senior editor of SBN.
This years distinguished judges are Daniel Austin, vice chairman of McDonald Investments Inc.; Carol Latham, president & CEO of Thermagon Inc.; Thomas McKee, a partner at Calfee, Halter & Griswold LLP; Larry Roth, Cleveland chapter president of the Young Presidents Organization; and Loyal Wilson, managing director of Primus Venture Partners.
Owners and managers who are primarily responsible for the growth of a company and active in top management are eligible for the award. Self-nominations are encouraged, as are those from suppliers, customers and others who work with entrepreneurs.
Regional award recipients will go on to compete for national recognition in several award categories, including the 2000 national Entrepreneur Of The Year. All national award recipients and finalists will be announced and honored at a gala during the Ernst & Young Entrepreneur Of The Year International conference in Palm Springs, Calif., Nov. 11.
Previous national EOY award winners have included Michael Dell of Dell Computer Corp. and Richard Schulze, the founder, chairman and CEO of Best Buy Co. Inc.
This years program is sponsored locally by McDonald Investments Inc., the Ohio Department of Development and SBN magazine. For more information, visit www.ey.com/eoy.
Profits are down, your company’s overstaffed and hard choices have to be made. Layoffs, though painful, are the best way to trim overhead.
So how to do you deliver the bad news to your staff without causing an employee revolt?
“There is a direct correlation between the way employees get on with their lives and the ways news is communicated,” explains Amy Rogat, senior vice president of Russell Rogat/Lee Hect Harrsion, a consulting firm that helps employees and employers work through changes such as massive job layoffs. “The goal is to make it less painful, because there’s a tremendous impact on those people leaving and those people who remain.”
Rogat suggests three rules for those who have the not-so-friendly task of being the messenger of bad news:
No small talk. “Don’t even say good morning,” she says. “Just say, ‘I have some bad news.’ Brevity is important and get it over with quickly.”
Write out the benefits. “After the bad news is delivered, little else registers with the people involved,” she says. “Write out all the benefits the discharged employee will receive so that everything is clear.”
Avoid putting a positive spin on the situation. The bottom line, says Rogat, is that there is nothing positive for the people who are most affected by job loss. “Give them the news, then make sure to provide them with information or services to help them move on.”
How to reach: Russell Rogat/Lee Hecht Harrison, (440) 331-4400
The second annual Innovation in Business Conference, sponsored by Anthem Blue Cross and Blue Shield of Ohio and presented by SBN, will be held Thursday, Sept. 7, 2000, at the Marriott downtown.
This years panel of Master Innovators has been named. Participating in this years discussion are:
- A. Malachi Mixon, CEO of Invacare Corp.
- Luis Proenza, president of the University of Akron
- Jacqueline Woods, president of Ameritech Ohio/SBC
- Tom Sullivan, CEO of RPM
The evenings festivities will be moderated by Robert Conrad, general manager of WCLV-95.5 FM. Also recognized will be a group of Rising Stars and Visionaries. Nominations for Rising Stars and Visionaries will be accepted through June 30.
Individuals and companies are eligible for the program. Self-nominations are accepted.
The conference is also sponsored by Arthur Andersen, Pfizer, Sarcom, Brouse McDowell and ICG Communications. For more information or to receive a nomination form see page 6.
Daniel G. Jacobs