SBN Staff

NEO Ernst & Young Entrepreneur of the Year

Distribution and Manufacturing

Winner

 

Gary Schuster

president and CEO

OMCO

 

In 2006, Gary Schuster accepted an offer to take over as the president and CEO of OMCO, a supplier of custom metal parts made using a roll forming technique. He joined OMCO at a difficult time in the company’s history.

As a result of a downturn in the transportation industry and worsened by the economic recession, the company’s sales fell by 80 percent from 2006 to 2009. However, Schuster had innovative ideas, as well as a plan to rapidly recover by expanding into new markets.

Although the company had a long-term plan of diversifying its business past the transportation industry, there was no one in the company who was exploring future opportunities when Schuster took the helm. Accordingly, he hired a key individual who specialized in sales and marketing to focus solely on finding new customers and growing the business into new markets other than the transportation industry.

After Schuster and his sales and marketing team identified a need for OMCO’s custom roll-forming products in the rapidly growing solar panel manufacturing industry of the Southwest, he relocated his top sales representative to Phoenix.

In mid-2009, the company received its first million-dollar order followed by several other significant orders that same year. Schuster quickly took advantage of these growing opportunities in the solar energy market by opening a plant in Phoenix that could centrally serve the Southwestern region of the U.S. The subsequent rapid growth in this new market resulted in an increase of more than 300 percent in the company’s sales from 2010 to 2012.

Although OMCO’s expansion into the Southwestern solar market has provided great success for the company, Schuster insists on continuing to explore future opportunities. He has started to consider further diversification within the solar market to new geographic locations, particularly Australia, Saudi Arabia and Chile. He is also identifying additional new industries for the company to leverage.

How to reach: OMCO, www.omcoform.com

Business Services

FINALIST

At age 32, James “Jamey” B. Edwards took a huge risk by giving up a highly lucrative career at Lehman Brothers as an investment banker to become the CEO of Emergent Medical Associates; he was a businessman with no medical background or experience with the health care industry.

That meant he had a huge learning curve and had a lot to prove to the physicians as well as the executives of the company. But he met the challenges head-on, implemented various programs and increased revenue by more than 268 percent since his 2006 arrival. With results like that, Edwards earned the respect and trust of the company and the physicians.

One of the key factors he believes is necessary to grow a business is to create a culture of which everyone wanted to be a part. Edwards worked hard to establish a reputation for EMA to be the fastest growing company of its kind, providing high-quality care, and being employer of choice for providers and group of choice for hospitals.

Edwards believes in assembling the right team with the right people and empowering them to make the right decisions. With a lot of emphasis and resources being placed on training, these result in corporate employees who may better assist the physicians who then are trained so they may better attend to their patients. If physicians and patients are happy, it leads to the success of the business.

Two leadership groups are involved in managing EMA: physician leadership and executive leadership. The two groups may have different goals and visions for the company at times, but Edwards has created a “Senior Counsel” to help establish a partnership between the providers and operations teams.

Since Edwards joined EMA, the company has grown its number of physicians from 60 to 329. The company plans to continue to grow by acquiring sites located in Salt Lake City, Phoenix and Las Vegas, and by organic growth.

How to reach: Emergent Medical Associates, www.ema.us

NEO Ernst & Young Entrepreneur of the Year

Family Business Award

Winner

 

Marc Brenner

president and CEO

Ohio Technical College

 

In July 1969, Marc Brenner and his father Julius founded the Ohio Diesel Mechanics School. Over the course of 30 years, the school grew, added programs, training, and changed locations and names. In 1996, Brenner’s father retired, and he assumed complete and total responsibility for all aspects of the school.

In his new leadership role as president and CEO, Brenner implemented major changes throughout the organization, including redesigning classrooms, shop floors and training courses. One of the most successful strategies that Brenner implemented was a change in the marketing approach from targeting middle-aged adults to targeting 18 to 25 year olds.

This strategy led to rapid expansion, and in 1998, because of the increase of program offerings and campus developments, the school’s name was changed to Ohio Technical College, a private and accredited technical college providing career-oriented auto mechanic training.

Over the years, OTC has faced numerous obstacles such as obtaining financial aid for its students and limited housing. Through Brenner’s business acumen and vision for his college campus, he was invited by President Clinton to be a part of the advisory team to start Direct Loans, which offers financial aid to for-profit schools. OTC also purchased several houses, which are now used to house its students.

As the school’s growth continued, BMW of North America developed an interest in OTC and created a specialized training facility on the campus — one of only four training sites in the U.S. Most recently, the college opened a branch campus called PowerSport Institute that specializes in motorcycles.

Brenner and his team have developed partnerships with industry leaders such as Kawasaki Motorcycle, Yamaha Motor, Victory Motorcycle, Honda, Polaris and others. This branch campus of OTC now trains about 250 students and total enrollment for OTC and PSI averages 1,500 students on an annual basis. In 2009, OTC was recognized as the National School of the Year.

How to reach: Ohio Technical College, www.ohiotech.edu

NEO Ernst & Young Entrepreneur of the Year

Public Company

Winner

 

Michael Hilton

president and CEO

Nordson Corp.

 

Driving growth has been Michael Hilton’s objective since being named president and CEO of Nordson Corp. at the beginning of 2010.

Nordson Corp., a more than 5,000-employee manufacturer of products and systems used for dispensing adhesives, coatings, sealants and biomaterials for consumer non-durable, durable and technology end markets, has been a strong company, even during the recession years. When Hilton came into the company he saw it as an organization that could grow three to four times its size in revenue.

Globally, Nordson has a presence in more than 40 countries and has been well established in locations such as China, India, Brazil, Europe and Japan for a long time. To take advantage of growth opportunities, Hilton had to evaluate the business and understand the key areas that needed attention and resources.

Hilton believes the keys to achieving Nordson’s financial and strategic goals are innovative new products, growth in emerging markets and strategic acquisitions. In the 10 years prior to Hilton’s leadership as CEO, Nordson completed just five acquisitions. Since then, the company has made six acquisitions with global footprints and complimentary product offerings.

Through this recent acquisition activity, Hilton acknowledges that risks must be taken to continue to grow globally. These risks are most prevalent in adding new products to the company’s portfolio and the difficulty of integration into Nordson’s culture. As part of the risk mitigation process, Hilton has ensured that each acquisition/merger target passes the Integration Process Plan, which examines culture and market comparison.

With Hilton’s leadership, Nordson has generated record earnings and is on track to achieve its new strategic goals. Sales have increased and total assets have doubled since he has taken over as CEO. Dividends also have increased annually for 49 consecutive years, placing Nordson among only 15 other public companies to do so for that length of time.

How to reach: Nordson Corp., www.nordson.com

Business operations are subject to a number of internal and external risks, as are ownership interests in businesses. How organizations and their owners address these risks can have a significant impact on the value of businesses and interests therein.

“An enterprise risk management process involves identifying risks relative to an organization’s objectives, assessing them for likelihood and impact, developing a response strategy and monitoring progress,” says John T. Alfonsi, managing director at Cendrowski Corporate Advisors.

A well-defined enterprise management process (ERM) framework can protect and create value for organizations and their owners, he says.

Smart Business spoke with Alfonsi about ERM to better understand its applications.

Where is risk addressed in a business valuation?

The most common method of valuing a business is the ‘income approach,’ which requires a valuation analyst to project a business’s future cash flows, then calculate the present value of the sum of these cash flows by employing an appropriate discount rate. The valuation analyst must address risk in two primary areas: projected future cash flows and the discount rate. Effective ERM processes can help businesses increase value by affecting the estimates for these quantities.

How does risk impact projected cash flow?

There exists a risk that an organization will not achieve its projected figures. As such, the process by which management projects future cash flows can impact a valuation analyst’s assessment of the business. A key risk in the process is information integrity, the quality of information generated through monitoring and data assimilation.

Information integrity allows management to make well-informed decisions and should provide a valuation analyst with greater confidence in a business’s projections.

Valuation analysts can analyze information integrity by examining historical projections and assessing elements of the internal control environment.

A valuation analyst also should examine the variance between historical projections and a business’s actual performance. If a strong correlation exists, a valuation analyst can be highly confident in current projections, if the process employed by the organization remains constant. If not, the analyst must examine the variance between the past projections and actual performance to discern whether bias existed in past estimates and current projections.

What about risks in the discount rate?

The discount rate is the yield necessary to attract capital to a particular investment, given the risks associated with that investment. A project with relatively high risk will require a relatively high yield to compensate an investor for bearing these risks.

In determining the discount rate, there are two sources of risk that need to be quantified: systematic and unsystematic.

Systematic risk is the risk one must bear for taking on a risky investment in the market. However, systematic risk is estimated by calculating the return to public equities due to availability of data. The ERM process has little impact on systematic risks unless the business’s performance is heavily tied to market performance.

Unsystematic risk is sometimes broken down into two components, industry risk and company-specific risk. Industry risk reflects the risks identified with the industry in which a business operates. Company-specific risks encompass all other risks, including size, depth of management, geography of operations, customer and/or vendor concentration, competition and financial health.

How can ERM processes mitigate company-specific risks and increase value?

An ERM process should quickly gather and assimilate high-quality information for use in the organization’s decision-making process, allowing the organization to rapidly assess the impact and likelihood of risks associated with changes in its internal and external environments. Early assessment and mitigation can help preserve value and capitalize on risky events when competitors do not react as swiftly to environmental changes

John T. Alfonsi is managing director at Cendrowski Corporate Advisors. Reach him at (866) 717-1607 or jta@cendsel.com.

Insights Accounting is brought to you by Cendrowski Corporate Advisors LLC

Business Services

WINNER

A North Carolina native, Janice Bryant Howroyd left her hometown in 1976 and got a temp job in California, which introduced her to the need for job placement services. Then her entrepreneurial spirit flared up. She launched Act 1 Personnel Services in 1978 and has since dedicated her efforts to building an organization committed to keeping the humanity in human resources.

Howroyd is an advocate for balanced education and entrepreneurship in the workforce. Her active industry involvement gives her an understanding of the challenges faced by global workers and business owners alike.

In addition, her expertise on workforce optimization and entrepreneurship has made her a much sought-after speaker. She is also the author of “The Art of Work: How to Make Work, Work for You!” in which she distills more than 30 years of experience into a work/life balance guide.

As the founder, chairman and CEO of one of the country’s largest workforce management firms, Howroyd provides customers scalable advantages to excel through advanced technology and other service offerings.

Her passion for establishing lifetime relationships with job seekers, client companies and professionals within the human capital industry has enabled her to turn a successful domestic business into a world-class global enterprise.

Today, The Act 1 Group, Inc. is a reflection of her vision. Through her commitment to market-leading innovation and identification of market needs, Howroyd is able to expand her business, remain as the chief decision-maker of a workforce management firm and to match job seekers with companies where there is opportunity.

During the recent economic downturn, companies generally were not hiring as many people as they had been, but Howroyd was able to help her business customers increase their efficiency by using the most proficient human resource strategies possible. By continuing to inspire employees to excel in a business model that is agile and forward thinking, she will keep the Act 1 Group growing financially despite future market challenges.

How to reach: The Act 1 Group, Inc., www.act1group.com

NEO Ernst & Young Entrepreneur of the Year

Financial Services

Winner

 

Jeremy Sopko

CEO

Nations Lending Corp.

 

Jeremy Sopko and his business partner founded Nations Lending Corp. in 2003 after working for five different lending companies. Sopko, who is CEO, envisioned a company that would stand the test of time, overcoming regulatory and compliance challenges, fluctuations in interest rates and other challenges in the industry.

Sopko’s varied experiences with different lending companies allowed him to see the good and the bad in the mortgage industry. He leveraged his experiences to shape the vision of Nations Lending, a national mortgage lender and mortgage banking company serving 41 states.

His business philosophy is focused on open lines of communication with his staff, as well as allowing his employees to voice their own opinions, come up with new ideas and actively participate in the growth of the business.

Sopko’s emphasis on transparency can be seen in an active workplace that promotes frequent training opportunities and a true team environment. His unique, energetic leadership philosophy has been a catalyst for the strong growth Nations Lending has shown in its 10 years of existence.

The company has grown from a small lending operation to a dynamic multi-dimensional organization aimed at consistent growth. It also has grown 20 times over in the number of employees since 2003. Sopko has proven that he is a dynamic leader through the company’s ability to attract customers because of its quality service and honesty.

Sopko places a strong emphasis on people. He has more recently placed a heavy emphasis on professional development to promote more accountability and improved functionality of his departments so they can operate more independently. He is a strong proponent of frequent training sessions, and this has improved his staff’s pass rate for state licensing exams to more than 90 percent.

The mortgage industry is constantly changing, and the emphasis on training is important to Sopko and his vision for Nations Lending Corp.

How to reach: Nations Lending Corp., www.nlcmortgageloans.com

NEO Ernst & Young Entrepreneur of the Year

Family Business Award

Finalist

 

Scott Balogh

president and CEO

Mar-Bal, Inc.

 

Steven Balogh

vice president

Mar-Bal, Inc.

 

Over the past 20 years, the second-generation of the Balogh family, Scott and Steven Balogh, have transformed Mar-Bal, Inc., a compounder and molder of thermosetting materials, through customer collaboration, engineering design and investments in innovation. MBI engineers and manufactures quality, customized materials and parts to serve the appliance, electrical, transportation and industrial marketplaces.

Since Scott, president and CEO, and Steven, vice president, became involved with the business, the company has more than doubled its sales. The two have changed the culture at MBI by recruiting leaders in the plastics industry and implementing a focus on innovative processes.

One occasion of driving innovation was when a competitor with different polymers designed the company out of a Whirlpool product. Rather than placing focus on driving sales with its current polymers, the company concentrated efforts on identifying why it had been replaced. It identified that its polymers were no longer meeting customer’s requirements.

Typically, material is limited to colors such as white, bisque, black, red and orange. However, the market was demanding a metallic look. So, Scott and Steven, with the help of their engineering team, found a way to coat parts with actual metal vapors, a process they call Thermital. This allowed MBI’s product to have the appearance and feel of metal. Now the colors and finishes are endless and range from stainless and copper to candy apple red and royal metallic blue.

Today, the company’s innovation has attracted companies such as Whirlpool and General Electric, and has lowered cost for its customers and allowed it to gain an advantage over its competitors. Looking to the future, the Baloghs are pursuing the kitchen and bath market with the anticipation of developing a thermoset material that has the appearance of granite and Corian, which can be molded into sink basins and marketed as a lightweight alternative to the traditional porcelain sink.

How to reach: Mar-Bal, Inc., www.mar-bal.com

NEO Ernst & Young Entrepreneur of the Year

Retail and Consumer Products

Finalist

 

Kimberly Martin and Sarah Forrer

co-owners

Main Street Cupcakes

 

After more than 25 years in the hotel and hospitality industry, Kimberly Martin needed something more in her life. In 2006, Martin and her husband Sean Nock founded Main Street Cupcakes, a small idea with endless possibilities and flavors.

Martin and her husband were able to transform their small storefront cupcake boutique into a lavish destination customers could escape to. The company opened its doors in February 2007, and from that day, it has hit the ground running and has not stopped since. With Nock heading the baking, Martin handled the finances and her sister, Sarah Forrer, was responsible for marketing and public relations.

After a few successful years, Forrer transitioned to co-owner along with Martin. In just five years, the two sisters have been able to grow the cupcake boutique. Main Street Cupcakes was founded during a recession, and from day one people have been challenging the concept of a bakery based solely on cupcakes.

Now the key obstacle Martin and Forrer face is trying to stay ahead of other bakeries and other businesses that have chosen the same path they have paved. They use the motivation of new copycat businesses to help keep their edge in the industry. They are more determined than ever to keep growing and keep ahead of the competition with fresh ideas and flavors, and their further expansion into wholesale.

Main Street Cupcakes currently operates three different stores: Hudson, Medina and Rocky River, with a fourth store expected to open this summer. Although its stores are located in Northeast Ohio, Martin and Forrer have made Main Street Cupcake’s presence felt nationwide. They plan to keep expanding in the future and have plans to open new stores in markets outside of Ohio.

Main Street Cupcakes currently has more than 300 flavors published and has more flavors than any other bakery in the nation.

How to reach: Main Street Cupcakes, www.mainstreetcupcakes.com

NEO Ernst & Young Entrepreneur of the Year

Education and Non-profit

Winner

 

Carol Klimas

president

Lake Ridge Academy

 

The Lake Ridge Academy Board of Directors took an unprecedented step hiring Carol Klimas, an individual with a solid track record of success and respect in the banking industry, to serve as the first president of the K-12 school, when the Faculty Search Advisory Committee had made it clear that it wanted someone from the academic world.

The committee wanted someone who truly understands, appreciates and supports academics. You can only imagine committee’s bewilderment and dismay when Klimas, the banker, was hired in 2007.

But it was not Klimas, the banker, who showed up for work. It was Klimas the entrepreneur — an innovative, optimistic and hardworking individual who appeared more inspired by the school’s economic woes than overcome by them.

Rather than focus on introducing short-term solutions, she initiated an endless series of interviews, focus group sessions, and best-practice research to create a plan of action that would resonate with and mobilize a wide array of constituents. She assembled a list of practical tactics, weaving in inspirational strategies, which later became the foundation of Vision Beyond 50.

Any preconceived ideas of whether a banker could successfully lead an educational venture were soon shattered by Klimas’ absolute resolve to tackle each problem in a cooperative and collaborative manner.

Klimas believes the critical backbone of the school is its faculty and has championed efforts to attract and retain exceptional talent. The credentials of the faculty today are quite impressive with about two-thirds of them having taught at a college level and the majority having a master’s or Ph.D. degree.

As a result of Klimas’ efforts, overall enrollment growth at Lake Ridge increased by 12 percent, inquiries are up 45 percent from the prior year and applications have increased by 20 percent since last year. Klimas believes a target student population of 480 will be achieved in the next two years, which is more than 100 students above current enrollment.

How to reach: Lake Ridge Academy, www.lakeridgeacademy.org