Officials at Danly, a multimillion dollar die manufacturer, recognized three key areas of opportunity:
* Utilize e-commerce to expand the reach of Danly's products and market over the Internet.
* Make it easier for customers to do business with the company.
* Reduce the transaction cost of processing an order.
"The end solution was a business-to-business e-commerce site that is completely integrated into our back office," says Sarp Uzkan, director of information systems at Danly. "The customer doesn't need a catalog or to even talk to a salesperson. They can go find the product they need on the Internet and place an order."
Today, the site, www.danly.com, lists 95 percent of the 8,000 parts the company sells, and that number continues to grow. Five percent of orders originate through the Web.
Uzkan says that early last year, after the site relaunched, it received more sales than anyone had imagined.
"It's given us the opportunity to take orders from countries where we have no sales reps," says Uzkan. "We've gotten leads from new customers in areas we hadn't tapped into."
Information taken from the Web site is sent to the sales department for follow-up. As the economy worsened, these leads became more valuable, and selling online has opened up new geographic areas and industries for the company.
Danly also added tools to the site to provide customers with as much information as possible, making it easier to do business with the company. A study in 1999 showed that 30 percent of all calls to the company concerned order status and tracking numbers. As a result, it made this information available online, along with product pricing, availability and CAD drawings.
"We know the way our customers buy products," says Uzkan. "Many of them like to shop around and find the right price. This fits those customers' needs because all the information they need is online."
The e-commerce applications have also minimized costs. Orders generated from the Web are transmitted directly into the company's back office system without human intervention. The product is taken off the shelf and shipped immediately.
Danly also got more value out of its EDI technology by applying the same processes to the e-commerce platform.
"We're not adding value to our customers while we are transacting or processing their orders," says Uzkan. "The more we can automate, the more we can take out costs or waste in the chain."
When a manufacturer emphasize direct sales, distributors typically start to worry, seeing it as a threat to their income. But Danly, which makes about one-third of its sales through its distributors, has invited them to join the e-commerce party.
"We have created a Web site for our distributors to sell our products or any others over the Web without going through a lengthy implementation," says Uzkan. "We are actually hosting some of our distributors' sites and making a little money on it."
As a result, distributors can quickly set up a site to sell their products over a system that's ready to go without investing in hardware, software or consulting. Better yet, Danly helps them sell more of their products. How to reach: Danley IEM, (440) 239-7600
The life-long resident of Cleveland and product of the Cleveland Public School System was one of only 15 minorities in her graduating class at Case Western Reserve University. She was one of the few women elected to the city's prosecutor's office and one of the youngest judges to take the bench in Ohio.
She then went on to be the first African-American woman elected to the Ohio House of Representatives.
In her position in the U.S. Congress representing Ohio's 11th District, Tubbs Jones champions small and minority-owned businesses. SBN Magazine sat down with her to discuss what the government has done and should do to support business owners.
There's been a lot of attention on large national corporations, but what is this administration doing to help smaller business and struggling communities that may not get as much press?
I sponsored an amendment that has to do with disaster loans for small businesses ... to amend that legislation to allow credit unions to administer the disaster loans. Traditionally, member credit unions have not been able to do so, in part because it was believed they had a restricted membership, so it wouldn't allow everyone to come to the table.
My reasoning, however, was that there are many communities where there are no financial or banking institutions as we know it. In some areas, a credit union is the only financial institution. To allow small business to access this money -- that would be the only route.
Also, many traditional financial institutions have taken the position that the loans are too small, that the cost of administration is too great. Therefore, many areas just don't have access to this much-needed help.
Are there other programs that the Committee on Small Business, of which you are a member, is working on?
Helping businesses access government contracts is one of the things we've been battling. The issues include contract bundling. The government makes contracts so enormous that only really large corporations can access them.
In the three years I've been in Congress, I have been working on behalf of small businesses to stop the bundling process so anyone can come to the table. It's not legislation. It has more to do with SBA and government agency procedures than any legislation.
It's the constant reminder to the agencies, the procurement officers, that bundling of contracts has a detrimental impact on the ability of small businesses to work with the government.
What is this administration doing to address minority- and women-owned business issues?
I am committed to economic empowerment. When I leave Congress, I want people to remember it is what I worked on. And the reason economic empowerment is so important to me is because I believe it's the equalizer. I think it's the way to make sure those women and minorities have an opportunity to have equal access.
And I'm working on wealth building in terms of home ownership, in terms of predatory lending.
You're a role model. Talk about how you've been successful.
I was always a hard worker because I knew that how I fared would impact how other women and other minorities would be treated in the process. I sought out and found great support, too, through relationships with city judges, male and female, white and black, to help me through the process.
In my position now, I have a great staff that I rely heavily on. And because I travel frequently between Cleveland and D.C., being able to communicate is extremely important.
I make use of current technology, too. I'm trying to go paperless, which is really a difficult process, but I use this Blackberry (remote network management tool) a lot. It has my schedule on it, my phone numbers, and I can even e-mail from it.
How to reach: Congresswoman Stephanie Tubbs Jones, (216) 522-4900
(Downs) to AccuSpray. The Bedford Heights paint spray equipment manufacturer's recent Chapter 11 bankruptcy filing was due, in large part, to expensive warranty-related issues surrounding a defective product. While investors believe the company should emerge from bankruptcy, they also admit the mistake could have been avoided by extensive pre-market release testing.
(Ups) to Athersys founder Gil Van Bokkelen. As biotechnology begins to take center stage as a key component to Ohio's business future, Van Bokkelen's firm is getting endorsements from high places including Ohio Gov. Bob Taft. Let's hope the thumbs ups sparks greater investment and leads to new industry jobs.
(Downs) to U.S. Rep. James Traficant Jr. No matter what the outcome of his bribery trial, voters in his newly redrawn district should send a message on Election Day. Despite the maverick politician's outlaw charm, something doesn't smell right in Denmark, I mean the Mahoning Valley.
(Ups) to Southwest General Health Center. The UHHS-member hospital received the top five-star rating for treatment of heart attacks by a consumer health rating service. HealthGrades compared Southwest's services against more than 5,000 hospitals nationwide.
In fact, this year's big winner, Brokaw Inc., garnered the bulk of its recognition for advertisements promoting snow plows, animals, police and the Cleveland ad agency itself.
Brokaw pulled in 45 of the 155 awards handed out Feb. 20, including its fifth straight Best In Show award, which it received for its Web site at www.brokaw.com. The decision was unanimous by the four judges.
Brokaw won four gold awards, 14 silver awards and 27 citations of excellence. Among the notables were the company's visually entertaining ad campaigns for Hat Trick Snow Plowing and the Animal Protective League.
The other big winner was Marcus Thomas, which picked up five golds, five silvers, 13 citations of excellence and two Judges' Choice awards. Three of their top honors were for work the agency did for the Cleveland Indians, including television spots highlighting the baseball team's 100th anniversary.
Wyse Advertising was close behind with 20 awards, one gold, eight silvers and 11 citations of excellence.
The other winners were:
Adcom Communications -- two citations of excellence
American Greetings -- one gold, one citation of excellence
Arras Group -- one citation of excellence
Aue Design Studio -- one gold
BrownFlynn Communications -- one citation of excellence
Derby DeMuesy -- one silver
designRoom Creative -- one silver, two citations of excellence
divine Inc. -- one citation of excellence
Dix & Eaton -- one citation of excellence
Doner -- one silver, two citations of excellence
Epstein Design Partners Inc. -- one silver, one citation of excellence
flourish -- three silvers, four citations of excellence
Hitchcock Fleming & Associates -- two citations of excellence
Innis Maggiore Group -- one citation of excellence
Karen Skunta & Co. -- one silver, one citation of excellence
Keith Berr Productions -- one silver
Liggett Stashower -- one gold, two silvers, two citations of excellence
Manheim Advertising Inc. -- one silver
Marefka Co. Inc. -- one citation of excellence
Nesnadny + Schwartz -- four golds, three silvers, one citation of excellence
Point to Point -- six citations of excellence
Stern Advertising -- four silvers, six citations of excellence
thinkinc. - one citation of excellence
Tiny & Gabes -- one citation of excellence
Wolf Group -- three citations of excellence
ADDY winners move on to a regional contest in Louisville, Ky., this month. Those winners go on to the national competition. The ADDYs are sponsored locally by the Cleveland Advertising Association. How to reach: Cleveland Advertising Association, (216) 241-4807, ext. 11, www.clevead.com
As an entry-level employee, I was directly involved with the factory workers. Along with my first taste of manufacturing, I received my first real lesson in employee incentives and behavior.
The company was very proud of its incentive system. Production employees, in addition to a base wage, received a piecework incentive. It established standard times for the manufacturing operations required to make every part. The incentive system paid off if employees beat the standard time to complete their operation -- if machine operators making a part with a 10 per hour standard made 12 parts that hour, they received 120 percent of their base hourly rate for that hour.
This seemed to be a win-win situation -- the company achieved improved production rates and the workers could make more money. However, I discovered productivity was not very good, parts were still late, quality issues were abundant and costs were high.
The system failed. The intentions were good, but the design was flawed. It was actually encouraging the wrong behavior.
One of the more obvious flaws was that operators were paid incentives based solely on the quantity of parts produced. Nothing ensured quality. This often resulted in operators being paid incentives for producing bad parts. And once the bad parts were discovered, they were often sent back to the same machinist, who could earn incentive pay to fix his own mistake.
The key to a successful system is in the design. It must ensure that, unlike that piecework system, it doesn't inadvertently reward the wrong behavior. Making that mistake is easy. You have a problem, and an incentive program seems like a good way to solve it. You want a quick fix, so you don't spend the time you should to think through the ramifications and the behaviors that could be encouraged by the plan.
Following simple guidelines can help ensure your design creates the results you intend.
Rules of thumb
In designing a plan, don't focus on only one aspect of the process; that will likely create unwanted behavior in another part. An incentive plan that rewards speed of manufacturing or delivery may create quality issues.
Don't be too general. If the plan doesn't identify specific objectives, it enables interpretation that could hurt rather than help the company. A plan designed to reward sales increases without specifically stating target products or price points may result in increased sales of lower margin, less profitable products and a reduction rather than an improvement in company performance.
Play devil's advocate throughout the design process. Involve managers and employees to get their input and discuss pros and cons of the plan. You need to feel comfortable that it will provide an incentive for the behavior you intend before you implement it.
Designed and used properly, incentive programs can be a powerful management tool to help solve short-term problems, mold behavior and develop the company culture. Joel Strom (email@example.com) is director of Joel Strom Associates LLC, the growth management practice of C&P Advisors LLC. The firm works exclusively with closely held businesses and their ownership, helping them set and achieve growth objectives while maximizing profitability and value. Contact him at (216) 831-2663.
Have you ever stopped to think about what this means? The customer is the lifeline of a business. Besides employees, customers are the greatest asset a company can have and must be treated accordingly.
For many companies, this has been a difficult time. People are waiting it out and treading cautiously through this first quarter, keeping purchases to a minimum. However, some have prepared for a time like this and are in a position to stay on the offensive and press forward.
Those companies took careful measure of their return on each investment, assembled the best management team and are quick to adapt to new circumstances. They instill confidence in their customers.
For customers to continue to make investments, they have to be reassured yours is one of those companies.
Here are four principles customers look for before making an investment with you.
1. Innovation. Are you leading or following? Find new ways to set yourself apart from the competition.
2. Value. Give customers more for their money. When people receive more than they expect -- in goods or services -- they place more perceived value on that transaction, which leads to higher customer satisfaction.
3. Sound leadership. Good leaders make good decisions. Evaluate whether you have the right leadership to keep your company on top.
4. Customer service. Service doesn't end after the transaction is done. If you want to keep customers happy, stay in contact after the purchase. Stay up to date on their needs and find out what they like and dislike about your product or service, which will help you fine-tune it for the next customer.
Even when you think customers are wrong, if you listen carefully, they're probably telling you something about your business that needs correcting.
In the current economic climate, you can't afford to ignore them. If you and your staff remember the customer is always right, you'll never go wrong. Fred Koury (firstname.lastname@example.org) is president and CEO of SBN Magazine.
Nearly 120 firms committed to projects totaling more than $73 million in new location or expansion projects. Those are expected to result in the creation of more than 2,200 jobs and the retention of 6,100 jobs, according to the Ohio Department of Development.
Among the companies that have made commitments:
Progressive Insurance. A $13 million expansion project in Parma for its transportation recovery division will create 300 jobs.
Sherwin-Williams. The paint maker's automotive division in Warrensville Heights has committed to a $15 million paint research and development center that will create 164 jobs.
Formtek. The company purchased the assets of the former SNS Properties and has committed $14 million to its Bedford Heights location. It manufactures equipment for handling, feeding and forming metal for stamping operations. The project will create 40 jobs and retain 125 at an average salary of $42,000.
Quark Biotech. An emerging cancer research company in Cleveland, Quark has committed $2.3 million for a start-up project that will create 40 high-paying jobs.
NeoMed Technologies. A start-up firm researching cardiac function, NeoMed has committed $6 million to a project that will create 50 high-paying jobs.
Sandra Philipson knew this even before she started writing children's books based on her springer spaniels Max and Annie. In the 1970s, she was the first female marketing manager at Macmillan Publishing Co. in New York City. She worked the phones and pounded the pavement of universities selling science, history and English textbooks to professors and instructors.
But even with a marketing machine like Macmillan behind her, books were still a tough sell.
"These nice people who want to write children's books look at you so sadly when you tell them this," Philipson says. "It is a huge, competitive business, and the big companies have all the advantages."
Her first book was based on her dog, Annie, who lost her front left leg to cancer. The incident inspired Philipson to write "Annie Loses Her Leg But Finds Her Way," which she felt would help children learn about loss and recovery. A second book, "Max's Wild Goose Chase," followed.
She didn't know what to do with her first story until her neighbor put her in touch with artist Robert Takatch, whom she asked to do sketches for the story. She was so impressed with his work that she decided her story could be much more than something to share with her family, but she was reluctant to submit it to a large publishing company.
"When you're working with a large publishing company, you don't have any control," she says. "They choose the illustrator. You would have no control over your cover, what the book looked like, and they would choose how the book will be marketed."
So Philipson decided to publish the books herself. But before she took them to the printer, she wrote a business plan with the help of two Cleveland State University business professors.
Based on their feedback, Philipson formed a Limited Liability Company made up of herself, Takatch and her husband, Elliot. After a first run of 6,000 copies, 3,000 of each book, Philipson planned her marketing campaign.
In less than two years, she has sold more than 11,000 books, mostly in Northeast Ohio. The rest of country is next.
"We knew that even if you have the best book in the world, people have to want to buy it," she says. "That's where the marketing comes in. I knew there needed to be a huge marketing push because there is a tremendous amount of competition.
"The big companies have the dollars and the marketing machine."
But limited funding doesn't mean you can't market; you just have to work harder. Philipson packed up her books and dogs and traveled to schools, dog shows, libraries and hospitals to push her product. A former economics, history and sociology teacher, Philipson called her education contacts to create a buzz. Even former First Lady Barbara Bush received copies of the books, and promptly sent Philipson a lengthy thank you note.
The word spread about Max & Annie. Philipson appeared on the cable network Animal Planet with her dogs. A mutual friend mentioned the books to Steve Austin, chief executive of Tag Entertainment, a Los Angeles motion picture company that produces family movies.
Austin negotiated with Philipson for several months before they agreed on a film adaptation of her first book. Filming is set to begin in March in Chagrin Falls.
The movie will star Robert Hays of the legendary "Airplane" movies and Robert Wagner, who is best known for his TV role in "Hart to Hart" but has recently appeared in several comedies, including the blockbuster "Austin Powers" movies.
"Today, people are staying at home and concentrating on families and looking for family entertainment," says Patricia Gillum of Tag Entertainment. "Animals relate very well to children. With many of our movies, the interaction of animals with human drama is intrinsic and our main goal." How to reach: Max & Annie LLC, (440) 893-9250
Morgan Lewis Jr. (email@example.com) is senior reporter at SBN Magazine.
Hit the streets
Sandra Philipson's strategic marketing tips for success
Test the product
Sandra Philipson called every friend she had in education and asked to read her book, "Annie Loses Her Leg But Finds Her Way," to students. She read to a variety of age groups, using two versions of the book, one with illustrations and one without.
She also tested it with elementary school teachers and librarians and made changes based on their suggestions.
"That's a very important market because they are on the front lines with the kids," she says. "They know what kids like, what inspires them, what interests them. I'm an educator, but elementary education was not my forte."
Analyze your market
Young families were an obvious market for Philipson, but she hadn't thought of two other specialized markets -- schools and medical centers.
So she created a step-by-step educational presentation about how she wrote and designed the books, then packed up her dogs and started making school visits. In last 18 months, she's been to 52 schools in the Midwest. Medical centers, while a natural fit for books like Philipson's, required a more delicate approach in the marketing effort.
"One thing I'm very careful about is I do not ever want anyone to perceive or think that I wrote this book to make money off children with cancer," Philipson says. "That is not the goal, and it's actually a very small part of our market."
Spread the word
Philipson held a book release party in Chagrin Falls, where she is based, and invited everyone she could think of, including friends of her husband, her illustrator and her book designer. She continues to market the books at every public event she attends, including conferences, speaking engagements and dog shows.
"I try to be out there," she says. "I try to be seen, to meet people, to tell them about my products, to tell them about my books and tell them about the educational program. You can't just sit in your ivory tower and hope to sell anything."
Build the brand
To help create a buzz behind her Max & Annie characters, Philipson found an area designer to create a plush stuffed Annie toy to sell with the books. She then found a stuffed animal toy company that already produced a springer spaniel stuffed toy and licensed it for the Max character.
"This could be the next 'Harry Potter,'" Philipson says. "The market for children is waiting for new characters. Max and Annie are those characters."
Morgan Lewis Jr.
Meaden & Moore joined 52 CPA firms across the nation in the merger of TAG International and AGN International-North America Inc. The merger creates an organization with 52 member firms and annual billings of nearly $400 million.
Mark Freeman Associates has been named agency of record for Safeguard Technology, a manufacturer of anti-slip floor, stair and walkway surfaces for commercial and industrial use.
First Federal of Lakewood has introduced Lakewood Investment Services, a business unit that offers investment products, financial planning and educational seminars. Bank customers can purchase individual securities through Financial Network Investment Corp. (FNIC) at all eight FFL branch locations.
Fifth Third Bank received top ratings from PLANSPONSOR Magazine's Defined Contribution Survey. The magazine says Fifth Third provides "exceptional customer service and the best retirement plan and pension products in the industry."
Lake Erie College's business administration program has been award accreditation by the International Assembly of Collegiate Business Education for its bachelor of science degrees in accounting, business administration and international business as well as its master's of business administration degree.
Silicone rubber compounder Silmix has been acquired by Michigan-based Wacker Silicones Corp.
Star Precision Products has been certified to the ISO 9001:2000 Without Design, International Quality System Standard.
Fire-Dex Inc. has upgraded its certificate to ISO 9001:2000 standards. The company is the first protective clothing manufacturer in the industry to receive this certification.
HI TecMetal Group's Brazing & Metal Treating subsidiary in Kentucky was honored by Ford Motor Co. with a Ford Q1 Quality Certification. The Ford Q1 status indicates that BMT-Kentucky is recognized as a Tier 1 and preferred supplier to Ford Motor Co.
Caster Connection has opened an office and warehouse complex in Novi, Mich. Caster distributes domestic and imported casters for the automotive, health care and restaurant industries.
Metal Supermarkets has opened a one-stop shop for small quantities of cut metal on West 140th Street in Brookpark.
Big Brothers Big Sisters of Greater Cleveland reports a banner year in 2001, in which it served 1,271 children. That's an increase of more than 51 percent over 2000, when the mentoring organization served 837 local youths.
A. LoPresti & Sons Inc. has joined PRO*ACT, a supplier of produce and perishables, as the group's 34th member. PRO*ACT provides produce category solutions and delivery service to foodservice organizations nationwide.
SALES & MARKETING
Sales Building Systems, specialists in building sales for restaurant and retail chains, has selected InfoGrow Corp. to provide online maps showing national retailers the untapped workplace market for each of their locations.
Today's rules of etiquette focus more on how well the function goes than on which fork you're using.
"The most talked about etiquette is which silverware to use, but most people will never know if you use the wrong fork," says Todd Thompson, service manager at Pier W restaurant in Lakewood. "Things have really mellowed out in terms of classic dining. It's more difficult to even find that kind of table service anymore. More and more places won't put out all the silverware, but instead replace it as needed."
More important is the overall impression your client gets from your function.
"When you're hosting a dinner for a client, the more important the meeting is, the more important it is to develop a relationship with wherever it is you are having dinner," says Thompson. "Most of what goes wrong is because of a lack of communication with the restaurant. People have expectations that don't get carried out."
When making a reservation, make sure the restaurant understands it's a business dinner so the staff can put you at an appropriate table.
"I've seen it countless times where someone doesn't communicate that fact and the table they really wanted isn't ready, so they have to wait 10 to 15 minutes while it's fixed -- and the dinner has already started on a bad note," says Thompson.
Take charge of your party if you have more than one person. Lead the others when being taken to your table and direct people to where they should sit, giving the most important person the seat with the best view.
"You don't need eight people milling about the table trying to figure out where to sit," says Thompson. "It gives the impression you don't know what you're doing."
Another way to keep things running smoothly is to arrange in advance for the bill to be paid. Either provide the restaurant with your credit card information before hand, or make impromptu arrangements during a trip to the restroom.
"Make sure the waiter takes care of it, and make sure the gratuity is put on it as well," says Thompson. "When a bill is subtly handed to you to sign, it makes you look classy and on top of your game."
It also eliminates any arguments over who will pay for dinner.
Developing a relationship with a restaurant can pay off big in making a good impression with your client.
"You can't overestimate the effect of the restaurant knowing who you are and recognizing you by sight," says Thompson. "When someone greets you by name, it really makes a difference."Join Pier W and SBN at Business Entertaining Etiquette on Feb. 19 and March 19, 2002, at Pier W to learn the rules of the game.