I'm not referring to the business organizations you've joined, or the luncheon series you attend, but to the people you communicate with during the course of your day -- for business, pleasure and pain.
Former New York City Mayor Rudy Giuliani is collecting multimillion-dollar contracts through his new business, The Giuliani Group, a consultancy group he formed a few months ago with the heads of some of the companies that suffered deep losses on Sept. 11, 2001. A year ago, when he was consoling the leaders of companies such as Aon Corp., which lost 175 employees in the World Trade Center, I doubt he was thinking about the career benefits this relationship could provide.
But like any relationship, created for any reason, it had the potential to become lucrative or detrimental.
After I moved out of my condominium recently, I rented it to a man who owns a small local marketing company. Shortly after he signed the lease, he called me at my office to ask if SBN would consider promoting a conference he was orchestrating.
My first reaction to the request was positive. He had already established a level of credibility with me through personal dealings, so I was quick to pass his request on to my boss. But that soon changed. Shortly after the phone call, he defaulted on his security deposit and first two months' rent.
How could I, in good conscious, recommend that my company stand behind his business if he was unable to keep up his end of a contract? My dealings with him were admittedly limited, but they were all I had to go on when faced with the decision of whether to pass his name on or let it go.
We build relationships almost every hour of every day in every aspect of our lives. You may not think you're networking when you're signing a lease or helping someone through a crisis.
But isn't that exactly what networking is, making an introduction? What face are you putting forward?
Jentner has subscribed to the same financial strategy through the stock market's boom into today's market lows. He calls it passive management, and with this approach, avoids the temptation of making a quick dollar on a hot stock or changing his strategy when times are tough.
This strategy has earned The Jentner Financial Group much recognition, including being named one of the top 150 independent wealth management firms by Bloomberg Wealth Manager.
While many people are pulling out of the stock market, Jentner's clients are not among them. He manages the portfolios of about 100 clients, with an average account balance of about $400,000. He works on a fee-only basis and encourages clients to stay diversified.
"Even during the '90s, when the stocks were doing well, we were still diversified," he says. "So the stock market may have been up 25 to 30 percent, and our portfolio may have only been up 12 to13 percent, but now when the stock market is down 10 to 30 percent, we are only down 3 to 5 percent."
Jentner says staying broadly diversified means diversification of noncorrelated asset classes, not just the purchase of many stocks. He recommends buying stock in very different asset classes: Domestic stocks large and small, and value and growth; international stocks, both large, developed countries and emerging countries; bonds; real estate and commodities.
The term "passive management" applies to the way stocks are chosen.
"Some people may try to pick investments in each asset class that they think are going to do better, and that's what we call 'active management,' he says.
With passive management, you avoid picking specific stocks.
"If we think your portfolio should be in large-cap domestic growth stocks, we would then use a specially designed investment that literally buys that entire market," he says. "Instead of having 100 stocks in it, it might have a couple of thousand. It's designed to own the entire class, and we do that for each of the asset classes."
He says you can't beat this approach for long-term growth.
"If somebody wants to try to beat the market, they have to use active management. You have to pick the winners and somehow outperform the market," he says. "Although it's exciting at times, if you look at it beyond a six-month or one-year basis, over a decade, 97 percent of these active managers will underperform the asset class they're trying to outperform." How to reach: The Jentner Financial Group, (330) 668-1000.
These companies have not only maintained sales over the last five years, but all have achieved an increase of at least 100 percent or $5 million in sales, or have increased total employment by at least 50 percent or 25 employees over that period.
On Oct. 10, 41 companies in Summit, Medina, Portage, Wayne, Ashland and Holmes counties will be recognized at the Cascade Capital Corp.'s Business Growth Awards program.
"I'm hearing some very good things that are starting to happen," she says.
After running divisions of General Cinema Corp. and Pepsi-Cola Bottlers of Akron, Rist formed her own management consulting firm, Norma J. Rist CEO Consulting. This spring, she was honored as one of the 2002 "Top 10 Women Business Owners of Northeast Ohio" by the National Association of Women Business Owners.
Here's what she's telling her clients they can do to maximize sales now, while preparing for a turnaround.
First, she says, create a pro-active plan.
"Prepare a budget that is built on realistic sales, your lowest core staff and reduced expenses," she says.
One way to cut expenses is to negotiate with suppliers to reduce their prices.
"If you don't ask for a lower price, you don't get a lower price," she says.
Next, she says, line up prospective employees to produce sales the moment you need them to.
"Identify new employees who you will offer a position to as soon as growth warrants the hire. Have them waiting in the wings," she says.
Now's the time to create a marketing plan you can implement as soon as you've turned the corner.
"Some people cut back on marketing, and they forget to put it in place when they really need it, which is two months before you turn the corner," she says.
At that time, there will be prospects looking for you who won't be able to find you if you aren't marketing your services to them.
She's also telling clients to "measure what matters." Don't just focus on monthly financials, but also look at the smaller reports on other aspects of your business. For instance, if delivery costs are a part of running your business, pull a report on how much revenue is generated per hour of delivery costs, not just on what those total costs are.
"Review the financials, and then look at up to 25 other reports that are important to run a tight ship. Those are the reports that many business owners are missing," she says.
And lastly, she says, if you're an owner, get more involved.
"This is the time to make sure all the departments are running the way they should be," she says. "You should get back in the game more like you were many years ago, because your leadership and inspiration during a difficult period can produce incredible results. Nobody can do what the owner can do." How to reach: Norma J. Rist CEO Consulting, (330) 865-5900
The first piece of the suite, unveiled in March, is a system that enables SummaCare members to access their prescription drug information through the Internet. The program, called RxEOB, can be accessed through Summa's Web site, www.summacare.com. Members receive passwords to access the system.
"It gives members the ability to go in and view all of their drug history," says Tracy Dankoff, pharmacy director of SummaCare. "In doing that, it allows members to get information about the drugs that they were prescribed. It also allows them to look at what their co-pay for that drug was and compare that to what their co-pay would be for other drugs in that class."
The system also provides names and locations of out-of-town pharmacies in the network so that travelers can easily refill prescriptions.
Dankoff says that while there is a national trend toward providing more medical information to patients via the Web, SummaCare is the only local health plan currently using the drug information system.
She says access to prescription information represents the just tip of the medical information iceberg, and that SummaCare plans to make a wide range of personal health information available to members soon. By the end of the year, the MCO's members should be able to access and download enrollment forms and claims information, she says. The organization plans to offer similar services to physicians and brokers.
SummaCare Health Plan, based in Akron, provides coverage to about 120,000 members in Northeast Ohio. How to reach: Summa Health System, (330) 375-3000
At the time, United Way of Summit County was ranked last among United Ways in large metro areas in terms of dollars raised annually. The Akron community was fed up with the lackluster job the organization had been doing supporting local charities and had demanded the board initiate a change in leadership.
So in 2000, two new minds were brought in to run the organization: Kulinski, a former Catholic priest and veteran United Way leader, and James Horne, who had spent his career in private enterprise, most recently in business development for Sikorsky Aircraft in Statford, Conn. Kulinski now serves as the Akron organization's president, and Horne serves as executive vice president.
"We were brought in because the community had urged the United Way board that they expected more from the organization," Kulinski says.
The task would not be easy. While the United Way of America name has always carried influence and has been backed by the nation's most powerful corporate leaders (including major contributor and board member Bill Gates), United Way of Summit County had lost that prestige. In 2000, only three of its 30 board members were CEOs, and many community leaders simply didn't understand the organization's mission and were not involved on any level.
To compound matters, when Kulinski and Horne were hired, they were given the goal of raising $15 million annually by 2003. To put that number in perspective, fund-raising had been flat for 10 years, and had peaked at about $10.6 million in 1999.
"The expectations of our donors and our community are driven by the same expectations that are driving change in the for-profit sector," Kulinski says.
He says those community expectations include "an entrepreneurial spirit, an increased use of technology, fanatical customer service, and training and hiring the best staff you can get -- but understanding you can't keep them."
A new level of competitiveness is expected, he says, at the same time resources are decreasing, and the number of nonprofits exponentially increases.
"To be successful in this environment, United Ways have had to change and learn from places like university development offices, hospital development offices, to have less reliance on the workplace campaign and increasing reliance on individual large donors."
The two knew they had a huge job in front of them and that they wouldn't be able to tackle it alone. With these new, aggressive fund-raising goals, they had to start running the organization like a business, not a nonprofit. To do so, they needed to somehow tap into the business acumen of local corporate leadership.
One of the first things they did was to change the local bylaws to authorize a larger board of up to 48 people, Kulinski says. Through the attrition of some of the original 30, and the addition of 17 new positions, the board of directors roster now reads like a who's who list of Akron leaders.
"Now we have the CEO of each local hospital, the president of the local university, the publisher of the paper and the CEOs of most major corporations," Kulinski says. "They like what they see, and they've become connected with us and engaged now."
It's not just name power those people bring to the table. Board meetings now last two hours instead of one, giving members the time to really participate in the decision-making process.
"By the very nature of the people we've brought on board, they don't want to sit there and rubber stamp things," Kulinski says. "Because we process a lot of decisions and proposals by committee, by the time they get to the board, we engage in legitimate discussion and real decision-making by the board members."
"The board has been a champion for helping us think outside of the box," says Horne. "They insist that the United Way look at the bigger picture and look to collaborate with community organizations. Because of that, we've done a lot more co-marketing and co-branding, and that's really been successful for both."
Kulinski says that with this new high-powered board made of up for-profit thinkers, United Way of Summit County was able to change its way of doing business.
"Charities are about doing good, and for most of this charity's history, we thought that doing good was good enough. But now we have to do good things, but we have to be businesslike in a highly competitive marketplace."
Kulinski says the agency not only learned to use the board's wisdom but also started to learn from the best practices of its customers: Its larger donors.
"Our advantage is that were dealing intimately with corporate leadership all the time," he says. "And if you walk around with your eyes open and you're smart enough, you can pick up their teachings. We like to look at the best that FirstEnergy does, the best that Goodyear does, and bring it to our table.
"We can use the resources of these great external customers that we have to create a stronger and better organization and increase capacity."
One of the first things they learned was that the agency had to change its customer service practices, Horne says.
"What we found when we first came on board was that the staff tended to not understand the fact that they needed to serve the customer," he says. "United Way has, in the past, relied on relationships that volunteers had with organizations and individuals. We wanted to move beyond that and really put the staff on the front line of maintaining and managing those relationships with the customers.
"So I spent a lot of time reconnecting with our customers, I mean going out and visiting, understanding, developing stronger relationships and then offering creative opportunities for those customers to meet their needs."
Horne quickly realized that the one-size-fits-all concept wasn't working -- they needed to create individual fund-raising packages for larger donors.
"They (larger donors) found that very refreshing," Horne says. "For example, for FirstEnergy, we manage their entire fund-raising drive in all of their communities (which extend well beyond Ohio) at no charge to FirstEnergy. If they're successful as an organization, they're going to be successful in Summit County. That's a model we use."
Kulinski adds that United Way no longer expects every business to have the exact needs for the exact same cookie-cutter campaign in the fall.
"We'll run a campaign in Akron, we'll run it at midnight, we'll do anything it takes to meet the needs of that customer, because they want to make the biggest difference in the community, and that's our job, to help facilitate that," he says.
United Way's corporate partners also taught the agency how to measure results, and how to show customers, in quantitative terms, exactly where their contributions were going. Because the agency had started to do this prior to Sept. 11, 2001, it did not suffer the same post 9-11 setbacks that other charities have suffered, Kulinski says.
"Our campaign was supposed to kick off on Sept. 12, 2001, and was postponed, but we still achieved significant growth in last year's campaign. It's because of our ability to bring value to our customer. 9-11 really enhanced people's sensitivity to being generous. We were in the position to reap the benefit of that increased awareness."
He says 9-11 showed that generosity is out there; donors just need to know where there money is going.
"People responded so overwhelmingly to the events of Sept. 11 that it showed me that there's a great deal of philanthropic impulse, and a willingness to give sacrificially to make a difference," adds Horne.
"It used to be that United Ways would talk about how many kids we served after school. Now we're going a step beyond and stating how the kids are better because they're in that program. Now our agencies have to do surveys, and now we can go to the donor and say, 'Because of your investment in your community, 63 out of 65 kids stayed off drugs during high school this year.'"
So far, the changes the agency has implemented have helped push its campaign totals up 8.2 percent this past year. United Way of Summit County now boasts the highest increase in fund-raising of any large city United Way agency in the country. (San Diego results were not listed). In 2001, it raised $12.5 million for local charities, in addition to the $4 million raised for Sept. 11 charities.
Kulinski says the goal of raising $15 million by 2003 is realistic, as long as the agency keeps its business mentality.
"The thing we're trying to do is operationalize our strategic plan all the time, and we want everybody to see where they fit in achieving this great community objective of improving lives by mobilizing community assets," Kulinski says. "Whether it's somebody at our switchboard or our executive vice president or director of communications and marketing, everybody knows our role." How to reach: United Way of Summit County, (330) 762-7601
When Sam Reed, an engineer for Akron-based R&R International, went to work last Friday, he had Puerto Rico on his mind. Its safe to say, so did most of R&Rs 225 employees.
Reed knew the companys quarterly conference call lunch meeting was that day, and that along with cash, clothing and other rewards, the company CEO would be giving one lucky employee a trip to Puerto Rico.
But Reed, who works on location for R&R in Reynoldsburg, Ohio, knew hed miss the meeting, so he e-mailed Kellie Kerr, the companys HR manager. He said, I wont be able to attend the teleconference, so just call me and tell me where to pick up the tickets, Kerr remembers. I said, Yeah, right.
Neither Reed, a 16-year veteran of the company, nor Kerr, thought he actually would be picking up those tickets later that day.
Reeds not the only R&R employee whos been handed an all-expense-paid week-long trip to places such as Hawaii, Tahiti, Bermuda and the Bahamas. For the last two years, the companys been rewarding employees with trips, cash and other valuable items every quarter.
The rewards are part of the companys REWARD program, an acronym for recognize employees willingness, achievement, response and dedication. The program was created in 1997 by R&Rs CEO Gurinder M. Rana as a way to promote safety, innovation, quality and performance, while improving profitability.
Sound too good to be true? While the company last year spent about $25,000 on incentives including $15,000 in cash rewards it saved three times that in recouped sick days alone, says Kerr.
Initially, we had a lot of apprehension from employees that this was just going to be another fly-by-night thing, and apprehension from management how is this going to benefit the company, says Kerr, who, with a group of employees, runs the program. Now its fully supported.
For a lot of the employees, its their first experience with an employer that does anything like this, says Kristine Burgess, an executive assistant with the company. It certainly is mine. People have never heard of a company doing something like this. It is really exciting and motivating to be a part of that.
The philosophy behind the program comes from the mindset and culture of Rana, who was born and raised in India. Rana started R&R in 1980 with a $50,000 loan from the Small Business Administration. The company, which specializes in construction management and environmental remediation services, brought in $56 million in revenue last year. Rana expects R&Rs revenue to exceed $100 million in 1999, partly due to the recent acquisition of Jennings & Churella Construction Services Inc.
In the Eastern world, there still a tremendous sense of loyalty, says Rana, who believes that the value placed on loyalty diminished in the U.S. when corporations such as AT&T and IBM started to lay off veteran employees. Fifty years ago, there was some kind of a bond that existed. There was a sense of loyalty, there was a sense of commitment. An employee knew that if they performed well and if they were loyal, theyd have a lifetime job. About 25 years ago, that unspoken, unwritten agreement was broken.
It really boils down to, what is the purpose of having a business? Is it just to have money? I think the purpose of a business should be much broader. The purpose of a business should be where people can grow, learn. We want to be connected, we want to be mentally stimulated ... we want to feel like we belong to something which is good. Theres nothing wrong with people feeling that they work for a great company.
Rana says developing recognition and incentives programs are ways companies can help rebuild that connection.
There now is a system through the rewards program where we can recognize employees and say, Your ideas are valuable, we appreciate you thinking about it, we appreciate you doing something about it and we appreciate you caring about it.
Kerr says one of the challenges of a successful incentive program is maintaining awareness not just on that Friday four times a year when a trip is given away.
The whole point is to keep the employees remembering the program, says Kerr. On the first of the year, we announce what the trips are going to be, with photos: Tahiti for second quarter, Las Vegas third quarter, Bermuda fourth quarter.
Throughout the quarter, employees are encouraged to fill out a brief nomination form when a peer is spotted preventing an unsafe condition, avoiding a potential material or profit-loss problem, performing above and beyond expectation, or suggesting an efficiency improvement. The committee grants each nomination a number of points for the value of the contribution.
Points can be cashed in at any time for the dollar value; for example, a very good suggestion may garner 1,000 points, or $100.
At the end of the quarter, during a cross-market theme luncheon, any employee who has either accumulated 600 points or not used his or her sick time, is eligible for the trip. All employees are invited to the lunch, at which company logo wear and other prizes are distributed.
Kerr is sure that the program has not only had lasting effects on the staff, but increased profitability.
A letter from a client, for example, how can you attach a dollar amount to that? she asks. But I certainly think it will have a lot to do with us winning that contract for another five years for $5 million. How can you really put a dollar amount to the program? The most important part is that if it werent successful, if the employees werent happy about it, they wouldnt be participating in it.
For Rana, it goes much deeper than that.
I think the responsibility of every business person is to not only create a financially strong company, but also create a place where their people feel comfortable going, he says. If you can pick the best of India and the best of America and we can combine them, we can create heaven on this earth. Its truly my desire to do so.
As a call-center manager, Mark Williams saw first-hand how excessive on-hold time can drain a company of dollars and productivity.
“I had agents sitting there on 800 lines and I was writing a check every month to AT&T for about $4,000,” Williams recalls.
“I thought there had to be a better way.”
So he did some checking around. He described the on-hold time problem to some of the biggest telephone companies in the country, and was told repeatedly to overflow his phone traffic into voice mail, then later return the calls.
That was January 1995. By April 1995, Williams had sold his previous company and started Virtual Hold Technology.
The concept is pretty simple, Williams says. When a caller calls in on an 800 line, he is immediately informed how long the on-hold wait will be, then is given the chance to either keep holding or get a call-back when his place in line comes up. Right now, the technology is software-based, but Williams is looking into moving the application to a network, or Internet, level.
By eliminating on-hold time, a company can not only save on long-distance charges, but also retain customers, says Williams. “Thirty-four percent of abandoning callers do not call back, and the cost of regaining a lost customer is 12 times the cost of acquiring that customer in the first place.”
The statistics may be persuasive, but the service has been a hard sell. “The biggest challenge was convincing big companies that we weren’t going to bring down their whole system,” says Williams. “The phone systems and 800 lines are the lifeline for the business to their customers.”
Williams has managed to convince some of those big companies. He currently counts BellSouth, the American Cancer Society, Home Shopping Network and IBM among his customers.
While Williams won’t disclose revenue figures, he expects 1999 figures to be 10 times those of 1998.
The application, Williams says, will be standard in all call centers five years from now. Who provides that product depends on how fast VHT moves.”It’s a speed-to-market issue,” he says.
“The biggest challenge right now is going to be maximizing the growth controlling the business while still not restricting growth. Right now, we’re starting to explode.”
Growing up in Cleveland, the drive to Summit County to see concerts and basketball games at The Coliseum was my first realization that Northeast Ohio consisted of more than Clevelands east and west suburbs. But the Cavs didnt stay long in Richfield, and soon ,The Coliseums premiere concerts started to trickle north.
To me, the demise of The Coliseum symbolized that as a region, Northeast Ohio just wasnt ready to share its resources. But that could be changing.
Regionalism is a word that the Northeast Ohio business community has heard repeatedly in the latter part of this century. If Cleveland, Akron and Canton could only work together as a region, think of the influence wed have nationally.
The arguments for regionalism have always made sense. Many will tell you that progress was stymied when political leaders got involved. All of a sudden, boundaries were drawn and the region was no longer a region.
That was then. A lot has changed. Ten, 15 years ago, cities and counties were fighting for new business. People were unemployed. Luring new companies into city, county and state limits was the obvious solution.
Now, entities involved in economic development are focused on the job glut. Suddenly, they arent so territorial about which businesses they lure into their limits.
When Dick Erickson, president and CEO of the Akron Regional Development Board, resigned last month, it wasnt much of a surprise to the Akron business community. In fact, there were many more cheers than gasps.
Erickson is taking a position as head of a groundbreaking organization with a mission weve all heard about: To create a unified voice for Northeast Ohio business. Well just call it regionalism to keep things simple. The difference is, its not just talk this time.
Erickson will become president and CEO of The Northeast Ohio Regional Business Coalition. Not only has he given up his job to support the effort, others are supporting it as well. The nonprofit group is governed by 22 trustees, most of whom are CEOs of major area businesses. Richard Pogue, former managing partner of Jones, Day, Reavis & Pogue and a long-time advocate of regionalism, has been appointed vice chairman of the board.
To date, five Northeast Ohio chambers have joined the group: The Akron Regional Development Board, The Greater Cleveland Growth Association, the Youngstown/Warren Regional Chamber, the Stark Development Board and the Lorain County Chamber of Commerce. Erickson says he had no intention of leaving his ARDB post, but as he told me, The timing just seems to be right to do this.
Erickson hopes to see the membership grow quickly and include other organizations in Northeast Ohio concerned with economic development. The coalition will focus on air service, technology and work force development. Erickson couldnt be more accurate when he says these arent Cantons problems, or Clevelands problems. Theyre the regions problems.
Cleveland is not Akrons competition. Canton is not Akrons competition.
Lets not let this effort go the way of The Coliseum. Connie Swenson (email@example.com) is editor of SBN.
When the new corporate home of Schumaker Homes and Schumaker Real Estate opened on Wise Avenue in April, the Schumaker family unveiled more than just a new building.
The Schumakers also decided to completely change and update their companies signage. New signs were designed for the inside and outside of their 24,000-square-foot corporate offices, and for the two model homes that sit on the same lot.
The trick was to find signs that would draw enough attention, yet not detract from the warm feel of the model homes or the tasteful landscape.
Its very professional, its very corporate, but it also has a comfortable feel to it, says Mary Schumaker Becker, director of sales and marketing, of the new signage.
The Schumakers chose to keep the signs simple. A new message, (Make yourself comfortable), with the company logo (Paul Schumakers signature), and a pair of slippers. All of the companys marketing collateral was changed at the same time for consistency.
Signage is very visual, Becker says. You have to be selective with the information you want to convey to your market. It needs to be concise. It needs to be clear. I think our signage does that it gets the message out.
While Schumaker Homes retained an out-of-state ad agency to design its new logo (the company now uses Cantons Innis Maggiore Group), Becker turned to Rick Akers, owner of Akers Signs, for help with implementation.
You really want to look at the landscaping and the architecture of the building, says Akers. You wouldnt want to put a steel sign in front of a cedar shake building. We really try to take the scenery into consideration.
Akers offers these tips in choosing and implementing new signage.
1. If youre building new construction, dont forget to budget accordingly for identification. While the Schumaker signage project cost well into the tens of thousands of dollars, most signage, when planned for accordingly, should cost about 1 to 2 percent of your total construction budget, Akers says. Basic building-front identification can cost a little as $700 to $800.
The mistake many companies make is they fail to include signage in their initial construction budgets, Akers says. If signage is not included, signs can end up in a parking lot, because the proper island or setback is not included in the architectural plans.
2. Set up a concept design meeting with your sign company. In discussing ideas for a new logo or image, or even updating your current campaign, Akers suggests starting by conveying the emotions you want to relay. Do you want your message to be festive or relaxed? Bright or understated?
Then, discuss what colors you want to incorporate. Also, understand that its not a free service, Akers says. While an ad agency will often charge more for a logo design, a sign company still must charge a fee for the design work it does.
Once the image has been decided, materials must be considered. Akers uses wood, aluminum, polyurethane and some recycled products. Becker chose plaster for Schumaker Homes signage, because of the high volume of traffic in the area, and to keep the colors vibrant, she says.
3. Conduct a feasibility study. Most times, the sign company will do this for you (Akers does), but understand that there are often city or township zoning regulations that must be taken into consideration, including minimum and maximum height requirements, setback requirements and overall size restrictions.
4. Next, choose signs that fit the sign companys expertise and abilities, any zoning requirements and your companys image and budget. Then, agree on a project completion date, make sure the right work permits have been obtained and wait for your new image to be unveiled.
We always ask our customers, What drew your attention? Becker says. Its amazing how many people will say they were driving by. Obviously, the homes are catching their attention, but signage has a big impact on that as well. How to reach: Schumaker Homes, (330) 478-4500; Akers Signs, (330) 499-1990 or www.envirosigns.com
Connie Swenson (firstname.lastname@example.org) is editor of SBN.