Dustin S. Klein

Wednesday, 26 August 2009 20:00

Healthy, wealthy and wise

No less an innovator than Benjamin Franklin opined, “Early to bed and early to rise makes a man healthy, wealthy and wise.”

This formula for health, wealth and wisdom was effective for the Founding Father who not only invented bifocals but also created the first American lending library, first fire company and American fire insurance company.

Humbly following Franklin’s lead, we invented our own formula, which we’re using to explain the relationship among three key components of this year’s Innovation in Business program: Healthy ideas + healthy people + healthy companies = healthy communities.

So what exactly does this mean?

“Healthy ideas” refer to innovation. Ask “what if” and approach the status quo with an open mind. There is no such thing as too many healthy ideas. They appear in numerous forms: new products or services, business models, employee management styles, and strategies for improving customer service or product reliability.

“Healthy people” means wellness. When you and your employees set aside time to maintain your health — getting enough sleep, eating right, exercising — both your body and mind will be sharp enough to make positive contributions.

“Healthy companies” are the engine that drives the economy. They create jobs, generate positive cash flow, and have an impact on employees, customers and vendors.

Mixed together, these ingredients combine to create “healthy communities,” where we live, work and play. These are communities that are vibrant, bustling and electric. Their economic engines are sound, and the ideas generated by the companies located within them impact people’s lives.

At Smart Business, we think this formula works. But if you’re still skeptical, put it to the test by joining us later this month at the 2009 Innovation in Business conference, sponsored by Anthem Blue Cross and Blue Shield.

Help us honor this year’s Visionaries and Rising Stars and engage in a spirited panel discussion with four regional experts on innovation.

You can find profiles of all 15 amazing organizations and the people who power them in this issue’s cover story package.

When you think about it, taking tips from the likes of Franklin makes a lot of sense. After all, he did invent the lightning rod. And before I forget, he was also instrumental in helping create a little thing we like to call the United States of America. So who am I to argue with Poor Richard himself?

Contact executive editor Dustin S. Klein at dsklein@sbnonline.com..

Sunday, 26 July 2009 20:00

Great communications

When times are tough, the first instinct of any leader might be to pull everything close to the vest, sequester him or herself, and focus on managing through the challenges.

That would be a mistake.

Pulling things in too close and cutting off communication with the people who most need to hear what’s going on — your employees — could compound the problems.

“If the employees understand the direction you are trying to go in, it’s much easier for them to understand an action that you’ve taken,” explains Anthony J. Alexander, president and CEO of FirstEnergy Corp. “They might not agree with you, but they understand.”

And when you need buy-in from the team that will be tasked with the hard job of execution, that’s exactly the way it should be. Whether you’re running a Fortune 250 company like Alexander, the focus of this month’s cover story, or managing a 50-employee services firm, when you face tough times, the most important thing you can do is keep employees informed about the situation.

In Alexander’s case, he reorganized the $13.6 billion energy powerhouse last year in the wake of a crumbling economy, laying off 335 people as a result.

Despite that, Alexander refused to tinker with his “out-front” management style, continuing to pound the pavement and meet with FirstEnergy employees across the company’s three-state footprint.

Alexander’s actions were prudent for many reasons.

First, he controlled the message. By meeting in person with people who were directly or indirectly affected, he was able to address questions and quell the rumor mill that was sure to sprout. He recognized that if you’re not disseminating real information, someone else who may not have the whole truth will spread his or her interpretations.

Second, he mitigated the inherent fear factor that accompanies budget cuts, layoffs and other large-scale organizational changes. While it’s not always possible to eliminate fear during times of change, when you’re willing to frankly answer questions, you secure good will from employees and often will reduce apprehension.

Finally, Alexander communicated his vision and reasoning to thousands of employees throughout the ranks. This ensured that they not only understood what was happening but were also able to willingly join him in the efforts to push the company forward.

There is no substitute for communication. Without it, you expose yourself to the very real possibility that you’ll just make any difficult situation that much worse.

Contact executive editor Dustin S. Klein at dsklein@sbnonline.com.

Thursday, 25 June 2009 20:00

Beacons of light

Inevitably, every conversation I’ve had with business leaders over the past few months has turned to the economy and how organizations are coping.

While each person has his or her unique take on the situation, as do I, a number of recent national surveys have put an exclamation point on what makes all of this so unsettling.

First, low demand for products and services continues to run rampant across multiple business sectors. This has created major barriers for both growth and survival.

Second, reduced access to credit has made cash flow an immediate concern. Even for those people who do have access, they’re reporting restricted financing options, tighter lending restrictions, stalled mergers and acquisitions activity, and a higher cost of borrowing. In short, things still aren’t good for many organizations that are on solid footing.

Despite these negative trends, panic isn’t an answer. There is light at the end of the tunnel, even if you’re concerned about how to keep your operations afloat and your next payroll covered.

Recessions are cyclical, albeit this one has hit more sectors than other recent ones, and things will eventually turn around. When we finally do look back at this period, we’ll be able to say that entrepreneurs and their innovations led the way toward recovery.

That’s why I’m excited about this year’s Ernst & Young Entrepreneur Of The Year awards. It’s an opportunity to set negative news aside and focus on the positives.

Sure, the entrepreneurs that make up the finalists and category winners face the same struggles as their peers, but they have spent their careers facing seemingly insurmountable obstacles and overcoming them.

Entrepreneurs are a driven breed. They demonstrate a completely committed belief in their ideas and have the perseverance to follow through no matter how many people say it can’t be done.

That ability provides the rock-solid foundation needed during tough times, when it’s imperative for an organization’s leader to remain calm and keep everyone focused. Only when you’re in control can you bring people together to develop ways to succeed.

As you read about this year’s honorees, let them serve as reminders of just what it requires to survive difficult times and come out on top.

Contact executive editor Dustin S. Klein at dsklein@sbnonline.com..

Sunday, 26 October 2008 20:00

Accidental innovations

Ilove stories about companies whose first steps toward success were stumbled onto by accident rather than plotted meticulously by design.

One legend goes like this: In 1878, a workman at a fledgling soap and candle company left for lunch and forgot to turn off the mixing machines, leaving a batch of a new “white” soap inside. While the fellow ate his lunch, air worked its way into the mixture. and when he returned, he found a white glop.

Instead of throwing it away, the man spoke with his supervisor, who instructed him to pour the mixture into the soap templates and let it harden. The product was cut, packaged and shipped. Soon, the fledgling manufacturer, Procter & Gamble, began receiving letters from buyers begging for more “soap that floats.”

In the resulting years, Ivory soap became one of the most successful products in American history and launched P&G toward becoming one of the world’s most dominant consumer products companies.

This issue’s cover story subject, Shearer’s Foods, wasn’t started by accident but certainly wasn’t founded by design. The snack-food company evolved from the humble roots of now-CEO Bob Shearer’s parents’ grocery store. When the family began making and selling its own kettle-cooked potato chips, the business began to change. Over time, the company became Shearer’s Foods.

Today, Shearer’s produces more than 60 million pounds of snack foods each year. Much like William Procter and James Gamble, Shearer wasn’t satisfied to rest on accidental laurels. Rather, he’s built the company by investing in people, searching for innovation and using a philosophy of inclusion motivation, where the curtain is pulled back and employees get to see all the pieces of the corporate puzzle.

“A lot of people have a fear of sharing sensitive information,” Shearer admits. “But I’ve always been very straightforward. That’s the key, so people know what your vision and plan is going forward, and everybody can work in the same direction.”

Innovation, as Procter & Gamble learned 130 years ago, begins on the shop room floor. Shearer and his company’s 700-plus employees would probably tell a similar tale.

Even with years of double-digit sales increases and more than 30 percent sales growth expected this year over 2007, there can be little doubt that the Brewster-based snack-food company’s best days remain ahead of it. <<

Contact Editor Dustin Klein at dsklein@sbnonline.com

Thursday, 25 September 2008 20:00

A time to reflect

All great sports executives know the dangers of spending too much time celebrating victories.

Unless the victory in question is the Super Bowl, the final game of the World Series or the last game of the NBA Finals, any celebration is short-lived so that the team’s focus shifts back to the next game and they don’t become complacent.

This month, through Cascade Capital Corp.’s Business Growth Awards, we honor 48 organizations from the greater Akron region for their ability to maintain sustained business growth during a five-year period that’s widely been considered a challenging — if not dismal — economic time.

By itself, this would be a good reason to spend more than a fleeting moment reflecting on how impressive the accomplishments really are, but there’s more to it than that.

One of the keys to business success is the ability to understand where your organization is at any given moment, develop a cohesive strategy that maps out a plan to move it forward and then to have the wherewithal to lead the organization to that goal. That leadership trait, call it “entrepreneurial spirit,” is exactly what the leaders of the organizations being honored this year embody.

Take for example this year’s FirstMerit Legacy Award winner.

Ellis Yan, founder and CEO of Technical Consumer Products Inc., has nearly tripled his employee base and more than quadrupled TCP’s revenue over the past five years. At the same time, he’s built an organization that today controls more than 70 percent of the U.S. CFL market.

Or consider Bargmann Management. Lisa Bargmann, the company’s founder, was its sole employee five years ago. Today, the medical billing and collection service firm employs more than 70 people and expects that number to reach 100 by year’s end.

Finally, there’s William Fink, president of Area Wide Protective Inc. In 1992, Fink bought a small contract security guard company but nearly lost it to bankruptcy three years later. But instead of giving up, Fink remade the company into a temporary traffic control service firm and supplied workers to a new market, the public utility industry. Now, AWP operates in 12 states and employs more than 650 people.

AWP achieved this milestone through Fink’s vision and leadership, and that’s one reason why, this year, we established the Entrepreneurial Spirit award and named him our inaugural honoree.

Contact Editor Dustin Klein at dsklein@sbnonline.com

Sunday, 25 November 2007 19:00

Street-smart entrepreneurship

John Zitzner is on a mission to groom the next generation of entrepreneurs. But Zitzner, a successful entrepreneur who sold his software firm to Xerox several years ago, doesn’t identify prospects in the halls of prestigious schools like Case Western Reserve University, Wharton or Harvard. Rather, he finds protégés in an unlikely place: inner city Cleveland junior high and high schools, where poverty is rampant and dropout rates run high.

Zitzner is founder and president of E CITY, a five-year-old nonprofit organization that teaches entrepreneurship to low-income young people in Cleveland. The group’s innovative 70-hour after-school educational program focuses on 14- to 21-year-olds and is structured on the belief that kids in the inner city who have mental toughness, street smarts, survival instincts and creativity can put those traits to productive use if they are given the right direction.

E CITY stands for Entrepreneurship: Connecting, Inspiring and Teaching Youth. It exposes students to how a business operates and focuses on each student’s ability to take ownership of his or her life to be productive, responsible and financially self-sufficient, Zitzner says. A heavy emphasis is placed on the correlation between what is learned in the classroom and what is learned in the real world.

Once accepted into the program, students spend 70 hours, in two-hour sessions after school, to learn the basics of how to start a business.

Each student is given a $50 grant to buy products that are resold for a profit as part of an initial lesson in business operations. Students then work with a mentor to develop a plan for a new business. At the program’s end, students offer a PowerPoint presentation about their business idea to a panel of judges. The judges award cash prizes that the students can use to advance their ideas.

E CITY’s success led Zitzner and his team to open a sister organization, E Prep, to a class of 125 sixth-graders. E Prep, which opened in August 2006, is built around a culture of entrepreneurship and teaches a college preparatory curriculum to sixth-and seventh-graders. The program’s goal is for every student in the program to graduate from high school and be accepted into at least one four-year college.

HOW TO REACH: E CITY/E Prep, www.ecitycleveland.com or (216) 881-0735

Monday, 25 June 2007 20:00

A different breed

Ilove talking with business leaders. Call me a business nerd, but there are few things more interesting to me than conversations with people running a company or a division of a company, and getting inside their minds to understand how they think.

But talk to an entrepreneur and you’ll get a slightly different perspective on leadership, management and business. As the person who founded and grew the company, an entrepreneur approaches everything as someone who has everything to lose or gain.

A few years ago, I identified four traits nearly every entrepreneur has. As we present you with the 2007 Ernst & Young Entrepreneur Of The Year awards coverage in this issue, it’s worth revisiting those unique characteristics.

  • Risk-taker. Entrepreneurs lay all their money on the table. They aim high and bet big, accepting the fact that odds are they will lose more often than they will win. Successful entrepreneurs, however, learn from their mistakes and apply the lessons to their next venture.

  • Vision. Visionaries clearly see what they want to accomplish and remain focused on their goals. How many people would have been willing to bet on a guy claiming people would buy $4 cups of coffee? But Howard Schultz did just that when he founded his first Starbucks coffee-house, and today, he runs one of the world’s most successful and well-known brands.

  • Confidence. Failure is never an option to an entrepreneur. There’s always a solution waiting to be found that results in success. Failure happens, of course, but that’s the downside of taking risks.

    True entrepreneurs exude a steady, confident attitude that says if they just stick with it, the business will succeed. They have utter faith in their product or service, and they never, ever waver.

  • Motivator. Because they’re not content with the long process of working their way up at a large company, proving themselves at every level and building legions of believers along the way, entrepreneurs possess the ability to inspire employees, build champions and get the most out of talented rising stars.

As you read through our special report on this year’s honorees, keep in mind these four traits and think about how they apply to your own leadership and management style.

Contact Editor Dustin Klein at dsklein@sbnonline.com

Saturday, 26 May 2007 20:00

Sky high

When former Continental CEO Gordon Bethune introduced the “Go Forward Plan” in 1995 that helped turn around the airline, he made the following quip: “Get the customer from point A to point B on time, safely and with their underwear every time.”

Results and rewards quickly followed, and within five years Continental went from worst to first in customer air travel, service and satisfaction.

Today, under the leadership of Larry Kellner, Continental remains a customer service-oriented airline and has stayed focused on keeping passenger amenities intact while offering clean, safe and reliable travel.

Robbie Anderson, senior director of Continental’s Cleveland hub, ensures his team delivers on the company’s promises and that travelers receive the full benefit of the airline’s Customer First Plan. The plan contains 12 service commitments was designed to ensure the best possible experience for customers and lays out how Continental will deal with any service failure.

For example, the commitment on delays, cancellations and diversions promises that all passengers will be notified quickly about changes to their travel plans and updated “every 20 minutes, or any time an update is received.”

Anderson says two key items contribute to Continental’s ability to satisfy its customers — a rigid hiring process and consistent, ongoing training. Hire the right people, train them well, communicate the company’s mission and let them deliver are the four elements necessary to success, Anderson says.

As a result, Continental has been named one of the 100 best places to work and received high rankings customer service satisfaction surveys.

HOW TO REACH: Continental Airlines, www.continental.com or (800) 523-3272

Wednesday, 28 February 2007 19:00

Trust factor

Eleven years ago, I owned a fledgling business that, like many young companies, was struggling to grow past the start-up phase.

Through a calculated risk, I put my trust in an overseas partner whom I’d worked with for several years and who had always talked about being honorable.

Unfortunately, my trust was misplaced. Through a series of unethical actions that sullied his honor, my partner reneged on his end of the bargain. The disastrous results crippled my operations and nearly left me in personal and professional financial ruin.

As painful as the experience was — it took several years to recover — I received a valuable lesson in business ethics. It can take years to build trust with your clients, vendors, partners and employees, but you can destroy all that hard work with a single unethical action. Worse, the damage you cause sometimes can’t be repaired.

A friendly reminder of the importance of ethical behavior arrived recently in the form of a letter from a former cover story subject. In it, this CEO announced his organization’s new code of ethics and included a copy of an 18-page pamphlet that contained sections on, among other things, accepting gifts, vendor-sponsored travel, honorariums, improper payments and conflicts of interest.

The CEO’s letter expressed gratitude for the relationships the company had built over the years and explained that to maintain these relationships, it was critical to hold every member of the organization accountable for following fundamental principles of ethical business conduct. Then the CEO went one step further by including a compliance hotline phone number to call if any part of his written promise was broken.

It’s a bold statement, but one that instantly caught my attention, as I’m sure it did with others who received the package.

Not every company has the resources to develop and implement a program with this level of detail for its constituents. But it’s an idea any CEO can adapt.

Just saying you run an ethical ship doesn’t make it true. Ethics deserves more than just lip service, and putting it in writing is a good way to make everyone in your organization accountable.

Say what you’re going to do, then do what you say; it’s as straightforward as that. As this CEO wrote in his letter, “Honesty and integrity are the hallmarks of this code. There are simply no substitutes.”

Contact Editor Dustin Klein at dsklein@sbnonline.com

Wednesday, 31 January 2007 19:00

Puzzle logic

My 3-year-old son, Sam, and I did a lot of picture puzzles over the holiday break.

Sam’s pretty darn good for a 3-year-old, solving 100-piece puzzles without much, if any, help from his old man. At first, I thought he was just memorizing where all the pieces went. But the more puzzles we did, the more I noticed him looking at the finished picture on the box for a moment before beginning, then gazing at all the pieces spread out.

After that, he simply built the big picture he saw by analyzing all the smaller pieces and determining how they fit together in the correct way.

In business, it’s no different.

To build a successful company, you must first understand and recognize the big picture, then be able to answer the question, “What is it you’re trying to create?”

That big picture is made up of getting the right smaller pieces in the correct places — the rollout of a new product or service, sales growth of an existing line, driving efficiency and cost savings through a segment of operations, developing new leaders, making a smart hire. Together, they add up to something greater.

When you focus on the big picture, you have a finalized goal in mind that you can aim for and, if done correctly, smaller milestones along the way that you can check off as you achieve.

This month, Smart Business and MAGNET are proud to recognize the 2007 eVolution of Manufacturing Award winners for their ability to adapt to a global manufacturing economy.

Our honorees are successful not just because they increased sales, became Six Sigma Black Belts or introduced a new product to the marketplace. They are successful because their leaders were able to see the big picture. They understood what they wanted their companies to become and, just as important, they recognized the smaller pieces that needed to be put together to achieve the goals.

Like Sam, they didn’t look at 36 different pieces and become overwhelmed by the sheer quantity, odd shapes or incomplete picture that stared back at them. Instead, they bore down and focused on manufacturing one larger picture out of many smaller ones.

And their ability to do so is worth recognition.

Contact Editor Dustin Klein at dsklein@sbnonline.com.