Cleveland (5895)

Monday, 22 July 2002 09:36

Wills to succeed

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Seven years ago, I worked with a struggling manufacturing company located in a very old and small building on Cleveland's near east side.

The first time I met the owners, I got a very special feeling that certainly didn't come from their facility or their financial condition -- they were definitely struggling. The combination of low sales and low margins made cash very tight. Paying the owners a decent salary was not even on the horizon.

Yet, they were so positive and obviously committed to making this business successful that I knew this client had real potential.

Today, the company is located in a beautiful new suburban facility and is the market leader in its niche. It has a motivated and dedicated work force and has met its sales projections while achieving an envious bottom line. It is one of those companies and success stories that make a career in consulting rewarding.

So what makes a company like this become a star performer and achieve such lofty successes?

Many factors come into play. But if you analyze any star company, you'll find two common underlying elements: commitment and focus.

Committed to succeed

When I first met the family owners, I could tell they would do whatever it took to succeed. Despite the struggles, they had a true commitment to their vision and eschewed all opportunities to leave the company and take higher paying jobs elsewhere.

They reinvested in the business even when they were taking meager salaries.

Today, that commitment remains. They continue to reinvest, to build the best team possible, to strive to be the market leader and to not rest on their laurels. They develop new products and invest in R&D. The family spends more money on marketing and product development than most manufacturers of their company's size.

Considering their commitment level, I would have been surprised if this company did not succeed.

Focused to grow

But its leaders didn't quit with commitment. When they added their strong focus, they became a sure bet for star status. I have heard it said that no growing business can have too much focus. But to reap the benefits of a strong focus, a company needs to truly understand itself and its environment. Our star manufacturing company really understands who it is, what it wants to accomplish and what it's good at.

To really have focus, an organization needs clear vision. It must understand its niche. That's important because when leaders veer off course into areas outside the company's core competencies and vision, if they know their niche, they will recognize the situation and get the focus back.

The payoff

Five years ago, we helped the new ownership team of a long-established contracting company develop a strategic plan for the rebirth of the company. Last month, we held a five-year review and update session.

We looked back at the success that the company had achieved over the last five years. It was evident how the team members commitment and focus helped direct and enable its success.

The original plan helped them define their focus. They identified their vision for the type of company they wanted to be, the type of work they wanted to pursue and the growth path they wanted to follow. During the initial planning process, the team made a commitment to that focus, then reconfirmed that commitment throughout the next five years.

At last month's session, as we reviewed the progress of the company, we found that it had achieved nearly every one of its targeted growth goals (including profitability targets). Everyone agreed that the organization functioned today as they had envisioned it would and that overall, the partners were very pleased with where they were and what they had accomplished.

As an outsider who had witnessed their progress over five years, it was clear to me that a good part of their success came form their total commitment, individually and as a team, to stick to the plan and remain focused on their vision.

These are just two examples of star performers that stand apart and have a brighter future than many others. It's not because of their products or markets but because of a total commitment to their plans and to their goals and a clear focus on their visions. Joel Strom (jstrom@jsagrowth.com) is president of Joel Strom Associates Inc., Growth Management. His firm works exclusively with closely held businesses and their ownership, helping them set and achieve their growth objectives while maximizing their profitability and value. Reach him at (216) 831-2663.

Monday, 22 July 2002 09:36

Under lock and key

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Technology, commerce and the law rarely coincide in a single case. When it does happen, the results can be dramatic.

This convergence occurred in State Street Bank & Trust Co. v. Signature Financial Group, in which the Court of Appeals for the Federal Circuit held that if the requirements of the Patent Act are otherwise met, business methods are patentable. Now, the opportunity exists for capitalizing on the business method patent wave and excluding competitors from using a business method.

Put another way, businesses can now patent the methods by which they operate, thereby creating a barrier to market entry for potential competitors.

Background of business method patents

Business method patents include virtually any method for conducting business as long as the method utilizes a computer aid. Otherwise it meets the requirements in the Patent Act of utility, novelty and nonobviousness.

Business methods can include the way a business is structured, managed, organized or executed. One particular area in which the filing and issuance of business method patents has been embraced is in e-commerce. Many e-commerce start-ups actively seek business method patents to block competitors and stake out their corner of the Internet. They correctly view patents covering their business methods as one of their only assets with potential value.

Business method patents have encountered widespread publicity, thanks in part to a few well-publicized lawsuits, particularly that involving Amazon.com's infamous one-click ordering patent. Media attention has raised public awareness that these types of patents can be another weapon in the battle to beat competitors for market share.

This publicity has also generated concern in some corners that the patent system is being abused.

Concerns about business method patents

Awareness generated by business method patents has naturally engendered concerns. Skeptics have created apocalyptic scenarios such as a single bank foreclosing all other financial institutions from offering home banking services based on a single patent.

Others argue that State Street went too far in liberalizing patent law. The federal circuit, however, has downplayed such scenarios and stated that the requirements of novelty and nonobviousness will preclude these situations.

Over the next few years, the Patent Office and the courts will likely address these concerns. Nevertheless, business method patents appear to be firmly entrenched.

Developing a business method patent strategy

No matter what the concerns and criticisms, businesses cannot ignore that for the foreseeable future, proprietary business methods are patentable and many businesses may be able to protect these methods.

Furthermore, as many financiers seek out promising new technology companies whose primary, or only, assets are their ideas, the importance of protecting these ideas may become paramount to the company's survival. Thus, the savvy business will develop a strategy for protecting its business methods.

For the start-up, a business method patent can often lead to higher valuations and make it difficult for larger, established entities to enter the start-up's market space. Analysts often see promise in a company's intellectual property, and with many start-ups, intellectual property is often one of their only assets. Also, the ability to establish a defined market presence by excluding competitors can be vital to a start-up company's survival and an existing company's growth plans.

Start-ups should look to business method patents as a way to help define their place in the market while providing some breathing room during initial growth stages. Existing companies may look to patents as a way to establish beachheads in new markets.

Looking ahead

Another factor driving companies to evaluate and establish programs for protecting proprietary business practices is the unforeseeable future. Since no company knows exactly what patent applications its competitors may have filed, the smart entity will review its practices and attempt to stake out a strong position barring competitors from using the same methods, if only to protect itself from competitors doing the same to it.

Even though the full scope of these patents will not be completely known for several years, every company should assess the extent to which its business relies on potentially patentable methods. Such an audit can aid the company in determining whether rights exist that should be protected, as well as help avoid disputes with competitors. Todd Tucker is an attorney at Arter & Hadden LLP and a member of the E-Group, a multidisciplinary group of attorneys which focus its practice on entrepreneurs, Internet, e-commerce and emerging growth companies. He can be reached at (216) 696-4661.

Monday, 22 July 2002 09:36

The will to succeed

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A quick tour of innovation practices across some of this year's winners easily reveals inspiring themes in how innovation plays out as a critical factor in business growth and development.

At construction industry service firm Fortney & Weigandt, promoting and providing incentives for innovation is a team effort. Profit sharing is leveraged to inspire boundless initiatives that are often more informally than formally organized. According to F&W's maverick innovator, Bob Fortney, "Our goal in life is to take each of the 200 parts of our business into continuous improvement on everything."

Innovation is a welcome strategy in this firm, especially as innovation so often implies risk taking. As Fortney puts it, "Risk taking is what we do. It's what our business is all about." From his perspective, why not focus risk-taking competencies on the very processes and systems that inspire the relationships that make up the heart and soul of the business.

Bill Zimmerman has done a yeoman's job of creating at Computer System Company the kind of new product incubator methodologies that have hatched several technical breakthroughs. By engaging both idea launch and feasibility teams, CSC has reinvented old equipment with new equipment capabilities through innovative engineering and software changes.

Many of the ideas bubble up from a culture infused with the momentum of continuous innovation success stories. In the dramatic cost savings from the equipment redesign, "the idea came from folks working on what we could do with the old equipment," Zimmerman says.

This innovative firm is not from the school where significant corporate initiatives are relegated to higher management altitudes. Instead, as Zimmerman states in one of this year's company newsletters, "We want our employees more involved in determining our future."

At SS&G, similar themes of unleashing ideas companywide are at play beneath the waves of innovation, propelling this self-reinventing firm to new industry shores.

"We encourage everyone to think in innovative ways about the business," says partner Gary Shamis.

Most of the company's new hires are from other professional firms rather than right out of school. Far from the usual NIH (Not Invented Here) management defensiveness, new recruits are encouraged to import best practices from previous work experiences. As the firm grows through mergers, the question, "What are you doing better?" evokes new approaches and a culture of innovative openness.

At SS&G, most innovation starts informally, then migrate to more formal teams that move innovation forward. Background to these efforts is the firm's achievement of being one of the first accounting companies to morph into a more broad base of financial services with a name that replaces owner monikers with an innovative brand featuring an equally broad appealing professional firm name.

Each of these stories demonstrates the ubiquitous edge innovation provides, whether the corporate environment is driven by technology, construction or professional services. Collaborative innovation -- even informally cultivated -- along with the refusal to restrict innovation to a single department or level, continues to be a common denominator in the impact innovation has on the primal triad of cost, quality and delivery. Jack Ricchiuto (jack@yournextinnovation.com) is a Cleveland-based management consultant.

Monday, 22 July 2002 09:36

The holistic approach

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Glenn Smith was relaxing in the back yard of friend's home one fall afternoon when he noticed a flock of Canada geese heading south for the winter.

The birds were flying in the familiar wedge formation. After a little research, Smith learned the reason behind their actions.

The bird in the lead serves as a wind foil for the others. When it tires, another bird takes its place and they are able to travel much further together than any single bird could alone.

Borrowing on this cue from nature, the president and CEO named his new Chagrin Falls-based e-commerce/Web consulting company Formation V Consulting.

"There are many leaders in this organization at any given time," Smith says, "but we have a direction and we fly together."

He spent more than a decade working in the consulting business before deciding to venture out on his own. One lesson he learned was to recognize the different sides of the Internet consulting business model -- applications and information technology. Very few existing companies attempted to handle both issues, Smith says, and the ones that did retained a primary focus.

Here's how he set out to differentiate himself from the flock.

Divide and conquer

Smith didn't want to fall into that trap, so the young entrepreneur took a different approach. He founded a second company, World Synergy.

"At the time I thought it was because the cultures were different," he says. "But it's a different way of thinking."

Each company has its own employees who deal with their own unique issues.

The e-strategy model, as Smith calls it, is a continuum from the idea down through the hardware that will ultimately implement it. Each of his companies focuses on specific areas. In essence, World Synergy works with companies to determine what they want to accomplish, how they will do it and how it will affect their business. Formation V deals with the infrastructure, the hardware and the programs.

Customers need both sides. The difficulty at many organizations trying to do both, he says, "is one side of the business doesn't understand the other side and vice versa."

Smith's approach circumvents that problem by creating two companies, each of which works within its specialty.

His e-strategy business model is composed of nine layers divided into two major divisions -- intellectual e-commerce, handled by World Synergy, and intellectual technology, tackled by Formation V. Both intellectual e-commerce and intellectual technology are trademarked terms.

World Synergy handles the first four layers: strategize, application, logistics and marketing. Formation V Consulting deals with the remaining five layers: communications, support, computing environment, security and high availability.

Smith is ready to deem his 2-year-old experiment a success. Clients are able to find solutions to both their IT and their applications needs in one company.

"The relationship that brings these two together is invaluable," he says. How to reach: Formation V/World Synergy, (440) 543-5565

Daniel G. Jacobs (djacobs@sbnnet.com) is senior editor of SBN.

Monday, 22 July 2002 09:36

Supporting innovation

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Every year, the Innovation in Business Conference is possible because of the dedication and support of its generous sponsors.

They choose to be a part of the event because of their commitment to innovation, not only within the general business community, but within their respective industries and, of course, their companies. Here, then, in their own words, are their reasons for their involvement and their views on the importance of innovation.

Anthem

Joseph LaGuardia, vice president of Ohio sales for Anthem, encourages his employees to work innovatively, whether it be in service, sales, network marketing, management or distribution. In his mind, all aspects of a company can stand a little forward thinking.

"I believe in innovation," says LaGuardia. "And I believe in recognizing and encouraging businesses in our community."

That helps explain why the giant health insurance firm co-developed the Innovation in Business Conference with SBN magazine in 1999. In this, the conference's second year, Anthem has helped facilitate the drive for recognition of Northeast Ohio's premier innovators.

According to LaGuardia, innovation is also the Anthem philosophy.

In the health care industry, insurers and their partners face a consumer-driven industry more and more. Thus, he says, "We need to respond effectively to market conditions, government regulations and customer expectations."

Arthur Andersen

Paul Schlather, managing partner of Arthur Andersen, says his firm became involved with the Innovation in Business Conference because he believes in innovation.

"We're in the infancy of what I like to call the technology revolution," says Schlather. "If we're going to be players, we have to be involved; and the earlier you get involved, the better off you're going to be in the long run. Technology drives the changes we see taking place today, so you have to be prepared."

To ensure that it remains competitive and innovative, Arthur Andersen employs what it terms the "Exceeds" model in dealing with customers to maximize customer satisfaction. The model has been used for years in the manufacturing sector, exemplified by customer surveys and questionnaires, but has largely been ignored in the service industry. Arthur Andersen strives to change that pattern.

"We never used to ask customers, 'How are we doing?' or 'What can we do better for you?'" says Schlather.

Now, he sees better communication between employees and clients and a better overall understanding on everybody's part.

Brouse McDowell

Chief Operating Officer Carol Thomas says that Brouse McDowell has always fashioned itself to be an innovative law firm.

"Innovation is critical to a business' success," she says.

Thomas says she would rather a business be proactive in getting legal help than reactive. That, she says, shows people are being innovative and taking risks.

"People shouldn't wait," Thomas says. "They need to plan on a strategy now."

Innovation has been Brouse McDowell's hallmark, says Thomas, "because not only has it made everyone more effective, but it has reduced clients costs."

Clients save money in travel fees and phone call charges with Brouse McDowell's "E-room" service, a collaborative work environment that allows clients and lawyers to work together in real time on documents. Now, clients and lawyers can sit at their respective computers working together virtually.

Soon clients will be able to go a step further and log in securely at Brouse McDowell's Web site to view their billing status, see documents their lawyers have prepared for them and leave messages for lawyers.

"Innovation keeps the firm competitive and allows it to attract good employees," says Thomas. "It allows them to go home and be with their families because they can access their documents and information at all times."

Sarcom/Frontway

Mary Rose Daugherty, area sales manager of Sarcom/Frontway, has seen a definite need for innovation in today's changing marketplace.

"Customers are demanding change to happen at a rapid speed," she says. "Consulting firms need to adapt to the demand for such rapid change."

To answer these demands, Sarcom/Frontway has created what Daugherty calls a "custom engagement model" to custom design the process of dealing with each individual client. Under the model, employees are empowered to solve customer problems and handle issues immediately that under other circumstances could have taken longer to address. Satisfying customers at the point of contact helps develop a more loyal client base, Daugherty says.

This is Sarcom/Frontway's second year of involvement with the Innovation for Business Conference, and Daugherty says the company got involved because "it's a good way to help support the Cleveland community."

ICG

Matt Wajda, ICG director of sales, says innovation is a must.

"As a provider of business communication, ICG recognizes the need to continually innovate in order to meet customer demand and remain a leader in a very competitive industry," he says.

According to Wajda, customers constantly develop new ideas for how they buy and sell products and services.

"Our customers are innovative, and therefore, we must be as well," he says.

In the telecommunications industry, the "two Cs" drive innovation: competition and customers. Says Wajda, "To maintain and grow its customer base, a company must stay in touch with not only its customers' needs but predict and address future needs as well."

This is ICG's second year of involvement in the conference.

Product Imagineers

According to Kevin Kolman, CEO of Product Imagineers, businesses are responsible for reinventing ideas to stay ahead in today's competitive market.

"Ideas are tomorrow's hot ticket items," says Kolman. "Innovation means trusting in oneself for others to follow."

As a creator of promotional marketing solutions, Product Imagineers puts emphasis on the customer's needs.

"Being able to focus on customers with new product campaigns to help get their name in the lights is critical," says Kolman. "We strive to create unique and innovative marketing programs that help focus on the positive."

Because competition and innovation go hand in hand, Kolman notes that being innovative is "like being tapped into the biggest universal search engine there is."

Product Imagineers is in its second year of involvement in the conference, and supplies the awards to conference honorees.

Pfizer

In the pharmaceutical industry, staying one step ahead of your competitors is not only the key to success, but the key to long-term survival. Pfizer, the giant pharmaceutical manufacturer, takes innovation as seriously as the next guy.

"Innovation is the key to improving health, and advances in research technologies and genomics," says Celeste Torello, manager of pharmaceutical communications for Pfizer.

Forward thinking aids Pfizer because it aids consumers -- those who benefit directly from medical advancements and who drive business and competition.

Innovation leads to "increasingly empowered consumers, new tools to help us work smarter," says Torello. "All signs point to a new era of opportunity in health and well-being."

Monday, 22 July 2002 09:36

R&D 101

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What does a $420 million company do when it dominates the roofing supply market and can point to the Sydney Opera House and Washington Monument as examples of its products at work?

If you're Beachwood-based Tremco Inc., you try to keep your competitors from knocking you down.

"When you're at the top and everybody's shooting at you and poking at you and prodding you, trying to take a piece of this and a piece of that, you see life from a different window," says Jeffrey Korach, president of Tremco Inc.

Part of his strategy to keep Tremco -- the leading roofing supply company for the construction industry -- on the top of the heap is a strong research and development arm that is constantly working to improve existing products, as well as pioneer new technologies. Where it gets complicated for Tremco is the fact that its products have already proven to be dependable and customers aren't exactly clamoring for something new.

"It's a tenuous battle," says Randall Korach, vice president of Tremco's Sealant/Weatherproofing Division. "We are industry leaders, so everything we do supplants something that we already have. You want to be careful not to rob Peter to pay Paul, so to speak, in developing those new products that may not create any great benefit to the user or yourself in the market."

Despite the market's aversion to change, company executives want the development of new technology to account for 30 percent of revenue within three years and executives say it's played a role in the company's $100 million growth since 1997.

Here's how Tremco handles R&D in an industry that often is more partial to a product that's tried and true.

Seek different opinions

From the top office, it is nearly impossible to figure out what is going on in the trenches. Nevertheless, when Jeffrey Korach became president of Tremco, the responsibility for R&D fell squarely on his shoulders.

When RPM Inc. purchased the company in 1997, he decided to shift those duties to the vice presidents who head each of the companies five divisions.

"We had to intimately involve the divisions in the R&D process because they are the ones that really understand what's going on from a marketing point of view," he explains. "It gets a little bit insulated by the time it gets to my level and doesn't have the degree of attention and proper focus that is necessary."

Set a budget

Each year's research and development budget is hashed out during the company's annual budgeting process. The heads of each division must submit a proposal justifying their financial requests and an outline of how they plan to use the money during the next 12 months.

Meanwhile, past R&D allowances are reviewed to gauge the success of prior investments.

"We spend at least 50 percent of our R&D resources on new technologies, vanguard technologies, change the game types of technologies," says Randall Korach. "The rest of our resources are spent on things like raw material substitutions and processing optimization."

Study the market

Reinventing the wheel isn't on Randall Korach's mind. Instead, he looks for segments of the major market in which he believes Tremco could beef up its presence and underserved niche markets the company could aggressively pursue.

For example, he focused on improving Tremco's reputation in the silicon sealant industry, an area of the market in which the company had lagged for more than a decade. So far, the efforts have yielded impressive results.

"We launched an extremely comprehensive and competitive line of silicon sealants to go gain share and we've been doing that with remarkable success over the past 12 months," he says. "We're seeing 100 percent year to year increases since our product launch."

Evaluate your progress

The risk associated with any R&D effort is spending time and money on a product customers won't respond to. Although the benefits of a successful effort can spur growth, Randall Korach says any R&D campaign must be well researched, then monitored regularly to make sure it fits the characteristics of the market and the needs of the company.

"The opportunities are endless," he says. "We do significant analysis to determine where our best chances for success are, the best opportunities for our capital, and we make strategic decisions on a daily, weekly, monthly and yearly basis." How to reach: Tremco Inc., (216) 292-5000

Jim Vickers (jvickers@sbnnet.com) is an associate editor at SBN.

Monday, 22 July 2002 09:36

On the move

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In the more than a decade since she left Sohio (now BP Oil) in 1989 to found Thermagon Inc., Carol Latham has proven that innovation can, indeed, drive success.

Working with just an idea -- a way to dissipate the debilitating heat generated by semiconductor devices in computers -- Latham has built a loyal customer base and developed a company that's in constant growth mode.

Her company's client list includes such heavy hitters as Unisys, IBM, Motorola, Silicon Graphics, Dell, Intel, AMD and Cisco, and continues to grow. Latham recently moved her company from its West 25th Street digs to a larger building on Detroit Avenue in Cleveland to accommodate new equipment and an larger work force.

Last year, Thermagon expanded from 48 to 81 employees, in the process reaching $11 million in revenue. She employs numerous innovative approaches to her work force, including teaching new hires multiple business functions as part of their training.

This year, Thermagon is approaching 100 employees, and Latham says the company should top the $17 million mark by year's end. So what drives this innovative Visionary on her quest to provide the best product -- and company -- in the marketplace?

SBN sat down with Latham to discuss her business philosophy and what's been happening with this multiple award recipient.

Growing companies often find themselves faced with temptations to expand beyond their core products. Is that true with Thermagon?

We manufacture thermal management materials that go between the parts of an electronic system. Everything we make has that focus. Historically, everything was polymer-based, but now we're doing work with nonpolymer-based materials. That's the type of diversity Thermagon explores.

The biggest chunk of our business is the interface materials -- the materials we put between the CPUs and the components -- and the heat spreaders. There is a smaller, but growing rapidly, part of our business as well -- the circuit board materials that we sell. We've doubled our bookings on those since January.

What's spurring your growth in a sector that's begun to slow a bit?

There's a slowdown in the technology sector. Companies like Agilant have recently announced problems, which are really experiencing supply problems. If anywhere in the supply chain someone can't produce, then you have a problem. That kind of thing tends to slow the economy down a little bit.

For Thermagon, our concern is that we use so much of certain raw materials, that in order to support our growth, we have to guarantee no problems in our supply line. Luckily, the semiconductor industry is booming, and telecommunications isn't far behind.

Are you funding this growth internally or externally?

Until 1999, when we got into this building project, we didn't have any debt. Now we have a line of credit and strong cash flow. We work from the cash flow first and borrow the rest. Financially, we're on very solid ground.

You've been known in the past to travel around the globe a lot, visiting many of your customers on a regular basis. What's happening on a global level?

I haven't traveled quite as much this year as last year. A lot of our international business last year was generated by U.S. companies manufacturing overseas. It looks like there's more being manufactured here than there used to be.

There's a lot of activity in places like Mainland China, Japan, Taiwan and Korea, but we're finding the U.S. sector is actually growing the quickest. That may be because a lot more manufacturers are using contract manufacturing. That's made things a bit more complicated because it causes us to deal with more than just the OEM (original equipment manufacturer).

Because of that, to track the business and determine where it's being manufactured becomes a chore. What may be manufactured in China today may be manufactured in Taiwan tomorrow and then again in the U.S. after that.

Could you touch on the importance of continuous innovation within your industry?

The ability to adapt is imperative. You have to know where to be and when. There's a tendency to get complacent in what you're doing, but you have to consistently try new things and shake the company up a bit.

For example, when I go overseas a couple times a year, I always have an audience. People are interested to hear what's going on with Thermagon because we constantly introduce new products, talk about testing capabilities and I often help solve problems on the spot.

As a company, we're really on the move. But it's a real challenge. People say it's great to be expanding the way we are, which it is, but most people don't know how difficult it is to absorb this type of growth in business. New products are continually being developed and introduced -- about quarterly.

That's keeping with the fast-moving changes that occur in the electronics industry. How to reach: Thermagon, (216) 939-2300

Monday, 22 July 2002 09:36

Moving on the Net

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It seems that working a dead-end job can pay off.

When Michael Miller was in college, he worked as a mover at a Cleveland moving company. Twenty-five years later, he handles his own business, The Box Office, selling boxes and supplies at prices that are making competitors' jaws drop.

Two years ago, Miller put his business online. Today, he serves customers in all 50 states and six foreign countries.

When he opened The Box Office (www.the-box-office.com), he sold moving boxes and supplies such as tape, cord and packing materials. What he didn't do was offer moving services.

"I wanted to specialize," says Miller. "I know the moving companies sell boxes, but I don't understand why people would buy boxes from them when they can buy them from a store that specializes in just boxes and offers them for much cheaper."

But while that niche made Miller's company successful, it wasn't until he migrated it to the Web that he saw the advantages of reaching a larger group of prospects. Here's what he found.

Expand your customer base

One of the advantages of the Net, according to Miller, is the ability to serve far more clients. He has kept the physical store open for his loyal local customers, but now serves customers across the nation.

"I have taken orders from customers in California and Massachusetts on the same day," says Miller, who usually ships the day he receives the order.

One thing he's noticed is that customers are surprised at how quickly they receive their purchases; they expect to wait a week, but instead wait only a day or two. Customers also appreciate the competitive pricing. Miller says he's found that people in cities like New York and Los Angeles are choosing his services over local box suppliers.

Pick up the pace

The ability to react quickly has helped Miller decrease the time it takes to handle a transaction. The seller spends less time making the sale and the buyer makes purchases more quickly and easily.

"There's no salespeople who spend time talking," says Miller.

Instead of going through salespeople, customers go right to the product catalog and indicate what they'd like to purchase.

From the other side of the looking glass, Miller says, "Internet customers don't waste my time." Web customers log on, search his online inventory and place their orders.

"There are two kinds of customers with any business," says Miller. "There are those that are serious about buying, and those you want to keep. Then, there are also those that waste your time. I can identify the good customers through the Internet. Those are the ones who are serious."

Make everybody happy

Miller finds that serving customers online is cheaper and easier. He doesn't have to pay a sales staff; in fact, only three employees comprise The Box Office staff. Miller doesn't have to pay for bookkeepers, either; there is no need for bills.

"Purchases are paid for immediately," he says.

Miller also likes the fact that his customers are happier with Internet business. Customers can order from the convenience of their homes.

"Communication is enhanced," he says. "Customers can talk to people who are knowledgeable. I tell them, if they have questions, they can just call me."

While Miller may have had enough of being a mover, he does know how items should be moved and he's happy to offer his knowledge. In fact, a large part of his time is spent answering calls and e-mails about how certain items should be packed and moved. And that has become another part of his business.

"After a day at the office, sometimes I'll come home and spend two hours working from home, answering e-mails," says Miller.

The 45-year-old husband and father claims he is just trying to make things easier and more fun for everyone.

"I'm not a businessman," he says. "I'm a problem solver." How to reach: The Box Office, (216) 581-4189, www.The-Box-Office.com

Courie Weston (cweston@sbnnet.com) is a reporter at SBN.

Monday, 22 July 2002 09:36

Lighting up the Web

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Deciding on a name was the easy part.

After Paul Vincent, the owner of Vincent Lighting Systems, nailed down the domain name, he faced the challenge of making his e-commerce plans a reality. He assembled a small team of employees to help work on the project and, less than two months later, www.virtualightstore.com was open for business and customer orders were being filled.

"We simply felt this was another way in which customers could do business with us," explains Vincent. "In order to be successful, it had to be backed up by a strong bricks-and-mortar business."

Vincent was able to get his Web idea from paper to cyberspace quickly and, more important, do it without letting it dominate the time and attention he needed to keep his long-standing physical business on the right track. Here's how he did it.

Make a financial commitment

Talk is cheap, especially when it comes to launching an e-commerce site. Researching a name and discussing a Web strategy are undoubtedly the first steps, but Vincent says real progress toward his goal was made only after he earmarked money for Web development.

"We had been talking about it before and had been researching names," he explains. "But it wasn't until the first part of February that I decided we were going to commit $10,000 seed money in order to get this off the ground."

Use in-house talent

Consultants, designers and IT firms can quickly whittle away any sort of budget, so Vincent made sure to outsource only what could not be handled by someone already on the company's payroll. In the end, he needed only to outsource the graphic design work. He tabbed one of his employees to handle all photography for the site, while another was chosen to work on the layout of the company's online store.

"Doing a lot of blood and guts work, so to speak, in house certainly saved us time and money," says Vincent. "It also gave us control over the final look of the site."

Limit your online catalog

Vincent knew there was no way he could offer all of the 12,000 products in the VLS catalog on the Web site. Instead, he at first limited the product offerings to expendables like light bulbs, paint and lighting gels that were sure to be in stock at all times.

"We made a conscious decision that we wanted to make sure that if a customer ordered something the night before, we could ship the next day -- period," says Vincent. "It had to be items we would have in our control and items we stock in our warehouse."

Stay consistent

Although some companies offer special deals on products purchased through their online stores, Vincent was skeptical about such a strategy. He decided that if he wanted the e-commerce site to truly complement Vincent Lighting's long-standing brick-and-mortar business, there would have to be no special deals offered to online shoppers.

"The pricing structure is the same in our catalog as it is on our Web site," he says. "If I'm a regular customer and decide to one day buy over the Web, and all of a sudden the prices much lower than what I've been charged, I'm not going to be very happy." How to reach: Vincent Lighting, (216) 475-7600; www.virtualightstore.com

Jim Vickers (jvickers@sbnnet.com) is an associate editor at SBN.

Monday, 22 July 2002 09:36

Laying the foundation

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Eighty percent of a leader's time is spent communicating (approximately 2,000 hours per year).

According to a study by the University of Minnesota, 60 percent of all mistakes are due to poor listening skills. These mistakes lead to countless hours spent repairing the damage of poor communications. To lead a company, department or team, strong communication skills are required.

So how do we build ourselves to effective communicators? It's a three-step process.

1. Build a foundation of trust.

2. Design and build a bold and open floor plan.

3. Make sure there are no roofs.

In this month's column, we'll tackle step one, next month, steps two and three.

Without a foundation of trust, we cannot lead people and transform companies. Unfortunately, trust is a one block at a time process that can evaporate with one act of deception or a misunderstanding. Have you ever held a grudge against someone you believe wronged you only one time? So how can we build this foundation?

One-to-one connections

Trust is not a group process, it is created in one-to-one connections. Building these connections requires:

Using multiple media. Find out the medium the other person prefers for communication. Some love the flexibility of answering e-mails. Others want a five-minute telephone call once a week to stay in touch. For others, a face-to-face meeting is necessary.

Getting personal. People don't care how much we know until they know how much we care. Ask about the goals and aspirations of those we lead. A leader's role is to serve followers and promote their potential. Ask team members how they're doing, find out their interests and goals and look out for their well being.

Appreciating, appreciating, appreciating. Hand-written thank you notes are the most powerful tools for team building. Identify what specifically the person did that was exemplary and how he or she contributed to the larger project or vision.

Our foundation has no "Buzz-ers"

How often do we communicate directly? Do we use long words, buzzwords and political politeness? To build a foundation of trust, this has got to stop. How?

Kill the buzz. Stop using terms and phrases like downsizing, paradigm shifts and "we need to get more eyeballs and increase the stickiness of our site." Speak in plain English. The goal is to be understood, not to impress.

Don't patch over problems. Use assertive communications. Most people communicate passively. If we have a problem with someone, we complain to someone else, which further erodes trust. How can we communicate assertively?

  • State the problem using only the facts.

  • Describe how these actions make you feel.

  • Explain the negative consequences of these actions and describe your reaction.

  • Describe what specific actions you want the other person to take in the future and the consequences if they fail to take the actions you have defined.

Increase the foundation's size

Trusted communications result when we understand people and situations better. We need to increase our foundation or our perspective to make this happen. As Steven Covey says, "Seek first to understand, then to be understood." Intellectually, this makes sense. Practically, it's a bit more difficult. Here are some suggestions:

Read, read, and read. Leaders are learners. Their offices have large bookshelves with books they have actually read. Consider one area of specialization and devour books, magazines and tapes focusing on it. Or, build generalist skills -- The New York Times, The Economist and Fast Company are sources to build a wider range of perspective.

Keep eyes and ears open on the job site. Listening is hard work but can be improved.

Concentrate. Remove distractions when possible. Focus on the person you are talking to instead of your cell phone and pagers.

Make eye contact. One powerful way to communicate interest is with our eyes. When we lock onto another person's eyes, this speaks loudly about our interest.

Now that we've begun to develop our rock-solid foundation of trust, the question becomes, how do we design and build a floor plan that really works? Find out next month. Mike Foti (mfoti@leadershipbuilders.com) is CEO/chief visionary officer of Cleveland Glass Block and president of Leadership Builders. Foti works with organizations to influence and motivate their people and help their businesses grow. He can be reached at (216) 531-6085.