Don Snyder is in the business of getting people to buy into his ideas -- literally.
Take, for example, the $500 he received in a Brightidea.com competition for his suggestion that Sears Kenmore design a rechargeable ice chest that plugs into your refrigerator. More than 4,000 ideas were submitted in the contest, which touted $3,500 in prizes.
Also consider Eureka! Ranch, a Cincinnati company dedicated to helping clients create ideas. Eureka! Ranch pays Snyder and others about $600 each time they're called to the ranch to be a "Trained Brain" to help a particular business client in its quest for innovation.
Snyder, special projects manager at J2 Creations in Delaware, says he's been called "the idea cowboy" because he's not shy about sharing his ideas. A former marketing and promotions director at Smooth Jazz 104.3 who later created training materials and intranet content for CoreComm as an instructional designer, Snyder's taking advantage of the so-called Idea Economy.
"My goal is to make more from the idea generation than from the production," he says.
Branding himself as "Don! the IDEA guy" since 1989, he's written a handbook, "100-Whats of Creativity!" full of questions to spur creative thinking; developed an Idea Journal to help people keep track of their brainstorms; written idea columns for publications such as Syndicate Inc., as well as for national sales trainer Jeffrey Gitomer's newsletter; and helped design Web pages for a new Brand Caf∪ section of business consultant Tom Peters' Web site.
Snyder frequents Web sites such as Brightidea.com to submit ideas and collect royalties -- about $2,000 so far -- as other members rate his contributions. At ideas.com, his suggestion for a new children's drink made the finalist list in a $5,000 contest for Coca-Cola.
In addition, he's frequently checking in with Ideadollar.com, which takes promising ideas to companies and investors to find buyers. The operators of that site have deemed four of his ideas worthy of shopping around: new packaging for alcoholic drinks, a sponsorship giveaway for college students, a way to disinfect pay phones and a new style of baseball cap.
Snyder also helps business owners assemble an internal "Idea Department" -- bright thinkers within the company to call upon for brainstorming on topics such as new services or customer prospecting.
Admittedly, he's nowhere near making a living off of his ideas -- yet. But he's quick to point out others who, across the nation and even in Columbus, are profiting from the business of using brains.
The big picture
In his book "Thinking for a Living," Joey Reiman theorizes, "Today currency is the idea, but tomorrow ideas will be the currency."
Reiman closed a profitable advertising agency to start BrightHouse, an Atlanta-based company whose only commodity is ideas.
His view of the future: "The company of tomorrow will encourage investigation."
He envisions "illustration houses" that come up with ideas and "execution houses" that translate those into reality.
Another beneficiary of the Idea Economy is Doug Hall, who at Eureka! Ranch is making a living helping others come up with ideas. Visitors to his facility have included executives from Coca-Cola, American Express and Johnson & Johnson.
He declines to state revenue but says he built the ranch and paid cash for it four years ago -- at a cost of more than seven figures.
Hall contends the Idea Economy is nothing new; it's just gaining attention, in part because of the media.
"This country 200 years ago was a wild and crazy idea," he says. "We are a culture, by nature as a melting pot, that we've brought about a lot of ideas."
He disputes the theories of those who claim they'll make money simply by selling ideas, saying the key is to convince clients to take their ideas to market and implement them.
"A big idea is a son-of-a-gun to execute," he says. "Big ideas change the world. They also change the way we do things."
Hall uses a technology called Merwyn, a simulated test marketing system for ideas. He's refocusing his business with what he calls a Trailblazer Training program, teaching small business owners scientific principles and practical tactics for thinking smarter and more creatively about how to grow their companies.
Snyder, himself, is becoming widely known in national "ideation" circles. In fact, the International Idea Trade Association has named him its first president.
Matthew Greeley, chairman of the association, says the group will be similar to a trade union, where inventors or "idea people" can create industry standards as well as a structure and different levels of certification. This will ensure quality for businesses using online idea exchanges.
"We just think Don's the most informed individual and that he really has a vision as to where this thing can go and how big it possibly can be," says Greeley, who also is CEO of Menlo Park, Calif.'s General Ideas Inc., which owns and operates Brightidea.com.
He predicts idea exchanges, which started in 1999, will grow even during the slowdown in the economy.
"It's really one of the few bright spots in a rather gloomy Internet outlook right now," Greeley says. "There are too many great ideas out there and too many companies hungry for them. What we're struggling with is setting the price points, and to a larger extent, companies don't necessarily understand how to take advantage of these types of services."
National and even international examples of companies jumping on the idea bandwagon include Edy's Grand Ice Cream Co., which invited consumers to invent an ice cream flavor in exchange for a $25,000 dream kitchen, and Johnnie Walker Scotch Whiskies, which offered $500,000 in grants and mentoring (see www.keepwalking.com) to inspire entrepreneurs and innovators to put ideas into action. Winners will be announced in September, and will be chosen based on submitted ideas that have the potential to change an industry, provide an innovative product or service, significantly impact a community and/or fulfill a personal dream.
In the real world
There's no shortage of idea-profiting wanna-bes in Central Ohio, either.
Consider Mark Henson, who nearly a year-and-a-half ago opened sparkspace, a Short North professional meeting space designed to stimulate idea generation.
Henson, who calls himself sparkspace's "director of guest happiness,"was inspired to start the business by Eureka! Ranch and by his seven years with local design firm Fitch Inc.
"I saw client after client after client come into our place and say the same thing: 'I wish I could work in a place like this,'" Henson says. "I said, 'I need to build this and see if they'll really come."
Clients the likes of Huntington National Bank and Nationwide, as well as smaller companies and design and advertising firms, have used the space, which in the first quarter of this year started turning a profit.
To foster creativity, Henson filled sparkspace with comfortable furniture, bright colors and items to stimulate visitors' senses, such as Starbucks coffee, aromatherapy candles and mind puzzles. He's also included the practical side -- overhead projectors, pens, flip charts.
"You can generate ideas under the gun and under stress and in discomfort, or you can do it in a comfortable setting," he says.
Henson's confident about the demand for his business -- so confident, in fact, that he more than doubled the daily rate from $500 to $1,200 this spring.
The price increase also covers amenities he's added: more technology, including additional phone lines and high-speed Internet access; a digital presentation system; meals; and other pampering. He stresses that he wants the technology enhancements to remain in the background.
"We're trying to get people to think with their brains instead of unplugging at the office and plugging in here," he says.
Henson watches the brainstorming in action.
"I've seen a wide range of idea-generating, from stuff that is truly companies getting together to propel themselves forward -- 'What are we going to do next? How do we make ourselves even better?' -- all the way down to, 'How do we stay afloat? How do we make it through this time of change so we don't have to lay off people?'" Henson says.
He's considering expansion options because sparkspace is most ideal for 15 people, and he's getting requests to accommodate larger groups.
Another local face "fanning the flames of innovation," as his slogan says, is Bruce Davis, who founded Creative Fire LLC one year ago to help companies come up with ideas.
"What I'm mainly doing is trying to bring in a culture of innovation where people can truly make sure they keep up with what's going on -- and not only keeping up, but doing something new and different -- and that isn't just a one-time thing," he says.
He makes sure corporate executives buy into the fact that the people who are working for them have insights that are valuable, then helps them empower employees to understand creativity and generate ideas. He's affiliated with Parthenon Innovation Group, a Tennessee company that's promoting innovation as a profession by actually offering a certification in the field.
Earlier this year, three other former Fitch employees started a local company called Frame360 LLC, which helps companies establish focused frameworks for their business, brand or communications.
"The Idea Economy really is about, I think, being able to focus and evaluate whether an idea is valuable and beneficial for you, or is it just another idea," says Jaimie Alexander, a partner in Frame360. "What we're trying to do is give people a framework for deciding what ideas will really translate and be valuable to their clients and be in sync with everything they are doing."
Fortune magazine's 500 list rankings, Davis points out, show corporations including Charles Schwab, Maytag and Microsoft that are recognized for innovation and admired by employees, customers and shareholders.
He says his experience at an insurance company that was bought and sold and merged into another was a world in which companies believed downsizing -- "becoming leaner and meaner," he says -- would drive stock prices up and help business.
"That's a temporary fix," Davis says. "The long-term fix has to be radical innovation. You have to be constantly recreating yourself and what's going on inside your company."
"True innovation," he says, "should be a comprehensive, cultural thing and should be part of the core competencies of an organization." How to reach: Don Snyder, 630-3438, firstname.lastname@example.org or www.dontheideaguy.com; Doug Hall, (513) 271-9911, email@example.com or www.eurekaranch.com; Joey Reiman, (404) 365-0550 or www.brighthouse.com; Mark Henson, 299-6995, firstname.lastname@example.org or www.sparkspace.com; Bruce Davis, 485-3473, or Parthenon Innovation Group, www.proinnovator.com; Jaimie Alexander, 421-0360 or www.frame360.com; Matthew Greeley, International Idea Trade Association, (212) 267-5877, ext. 21, or email@example.com
Joan Slattery Wall (firstname.lastname@example.org) is associate editor of SBN Magazine in Columbus.
What's the big idea?
These idea magnets have their own thoughts about the best ways to foster innovation. Here are their suggestions:
"Collect ideas from customers. Any company not collecting customer suggestions via the Internet is missing out on a great resource. Customers are literally telling them what to do in order to get them to buy more of their product."
Don Snyder, a.k.a. Don! the IDEA guy
"Be willing to listen to the wildest and wackiest things, because that's where some of the best stuff comes from."
Bruce Davis, Creative Fire LLC
"As an Idea Economy or weightless economy, it's really not so much how many ideas you have but how you identify the ideas that will be the most profitable or effective for your clients in the marketplace."
Jaimie Alexander, Frame360 LLC
"A big part of idea generation is to remove the distractions. Have everything you need close at hand so you don't have to think about anything except the problem you're working on."
Mark Henson, sparkspace
Employers, take heed before you seek denial of a worker's claim for compensation due to a psychiatric condition.
A ruling by the Ohio Supreme Court early this year means you may have to cover an employee's mental illness even when he or she had no related physical injury.
The original Stark County case started in 1996 when Leonard J. Bailey, an employee of Canton's Republic Engineered Steels Inc., was operating a tow motor and accidentally ran over and killed a co-worker. Bailey's claim for compensation for severe depression resulting from the accident was turned down by the Bureau of Workers' Compensation and Stark County Common Pleas Court, which said Bailey's condition did not arise from his own injury or occupational disease, so his depression would not be covered.
The 5th District Court of Appeals, however, reversed the decision and called the statute unconstitutional because it denies equal protection to workers suffering psychiatric or psychological conditions resulting from job-related accidents.
The Ohio Supreme Court then determined the statute was unclear -- but did not address the question of whether it is unconstitutional.
"When they make that determination, it is then up to the court to interpret the ambiguous portion of the statute," says Tom Sant, of counsel at Columbus' Bricker & Eckler LLP. He is a former assistant law director for the bureau and now represents employers in administrative and court cases for workers' compensation.
In the traditional 4-3 split that has aggravated business interests, Justices Andrew Douglas, Alice Robie Resnick and Paul Pfeifer concurred in Justice Francis Sweeney's opinion that coverage should be granted for the psychiatric condition if it arose from a compensable injury -- even that of a third party.
The case, which is pending, has been returned to the Stark County Common Pleas Court for a decision on whether Bailey has enough evidence to support his claim of depression.
"Our position is there's no rational basis to exclude this type of claim," says Richard F. Brian, a partner in Brian Law Offices, which represented Bailey. "We were hoping the court would go the full step and find the statute that precludes those claims unconstitutional."
Business interests feared the Supreme Court ruling would lead to an onslaught of mental illness claims, but both the Bureau and the Industrial Commission say they've seen no such indication thus far.
Brian's firm is handling another case through the appeals court that involves a psychological injury with no physical injury, however, so the constitutionality issue may arise again.
In the meantime, the Bailey case doesn't mean all accident-related mental illness claims are automatically compensable, points out Mary E. Randall, a partner with Black, McCuskey, Souers & Arbaugh, which represents Republic Engineered Steels.
"Employers at this point just have to be familiar with the standard and understand, at least for now, the injury must be a compensable injury," she says.
This means the injury would have to be to a covered employee. For example, if an employee of a trucking company accidentally struck and injured a child, the injury to the child would not be covered, Sant says, because the child is not an employee, so the driver in all likelihood would not have a successful claim of a resulting psychological condition.
Sant advises employers to provide counseling for workers who observe a terrible injury or a death.
"Make every effort to make the workplace as safe as possible," he adds. How to reach: Richard Brian, Brian Law Offices, (330) 494-2121; Mary E. Randall, Black McCuskey, Souers & Arbaugh, (330) 456-8341; Tom Sant, Bricker & Eckler, (614) 227-2331
Joan Slattery Wall (email@example.com) is an associate editor and statehouse correspondent for SBN Magazine.
Sometimes, it just isn't easy to say, "No."
Dean Haberkamp, executive vice president of marketing for National Century Financial Enterprises Inc., would have liked nothing more than to provide his firm's accounts receivable financing to the California hospital that requested funding.
After the hospital shut its doors, the community rallied behind it, raising more than $8 million and hiring back about 60 percent of its staff.
Unfortunately, though, Haberkamp had to reject the funding request. The hospital, which reopened in July, didn't meet the requirement of NCFE's investors that clients provide 18 months worth of financial data to prove a good record of collecting receivables. Haberkamp needed evidence that he'd get NCFE's money back.
"It's a dirty shame because I can't get that information to fund what they need to really grow," Haberkamp says.
"There's nothing more we'd want to do than help a community help a hospital to help a community," adds NCFE's Jim Nickell, associate vice president of marketing and communications. "But we have to have that 18 months. We can't vary from the program, from the structure, because that's when the problems really occur."
NCFE funds 10 to 15 percent of the hundreds of requests it receives annually and restricts the accounts receivables purchased to payors such as Medicaid, Medicare and commercial insurance companies, Haberkamp says. By cherry picking its clients, the company limits its exposure to loss. In fact, since its 1991 founding, NCFE has a customer retention rate of more than 90 percent, Nickell says.
Sometimes, turning down a client becomes a welcome opportunity, as was the case for Andy Coen, president and CEO of Norman, Jones, Enlow & Co.
A service organization he'd gained as a client had tripled its $2 million sales volume in the three years he'd worked with the company. However, the company's staff was overwhelmed by its growth and was not getting reports, audits and financial statements to Norman, Jones, Enlow in time for the firm to do its work. That made Coen's firm look like it wasn't doing its job.
When he finally told the company's owners that he'd need to increase his fee nearly 15 percent in order to continue his service to them, they decided to go out to bid for the work. Coen didn't submit a proposal.
"I knew these owners, and I just threw a lot of resources at it. We got the thing done, but clearly it was not as profitable an engagement as the majority of the other companies that we had," Coen says. "Rather than have everybody unhappy, we just decided not to bid."
Here's how NCFE and Norman, Jones, Enlow weed out their client lists.
* Know what's right for you.
Coen knows he needs many, various customers -- his largest client approximates only 5 percent of his business -- and clients who could expand their business with him or take advantage of the management consulting services he offers.
NCFE, meanwhile, looks for clients who have good records of their medical receivables, a system to track such information and a need to finance the company for a turnaround, an acquisition or other growth.
* At first, try to say, "Yes."
"We say 'Yes' to the part we can do rather than say 'No,'" Haberkamp says.
For example, a client asking NCFE to fund $6 million for an acquisition might have $5 million in receivables for NCFE to purchase. NCFE might agree to fund $5 million if the client can ask the seller to take a note for $1 million or reduce the price.
* Know when to end the relationship.
Even if you do as much due diligence as possible on potential clients, you still could end up with a dud. It's better to cut ties than let the client drag you down.
Whether you're suspending service to the client or the client has decided to go its own way, Coen says, simply be honest -- and don't burn the bridge.
"When this does happen, we try desperately to make the transition easy for them. We give their information to the other firm so they don't spin a lot of wheels and cost the company a lot of money," he says. "The clients think the pasture is greener, and when they get out there, it's not. You might as well preserve that opportunity."
"Life's too short -- you don't want to tick people off," Haberkamp says.
He gives suggestions to clients he turns away. For example, he told an Iowa hospital system that he turned down its request to fund the purchase of another hospital because there was too much competition in the area and it was planning to spend too much in the deal, among other factors.
"There's a little bit of financial consulting that goes along with that," Nickell says.
The hospital spent the past year restructuring its finances and growing its physician base to gain a better place in the market, and now it might eventually fit into NCFE's funding program.
"It's always a good reason to stand by your principles," Haberkamp says. "Say, 'Yes' to the deals you can say, 'Yes' to, but say, 'No' to the deals that are not good for the relationship today." How to reach: Dean Haberkamp, National Century Financial Enterprises Inc., 764-9944 or e-mail firstname.lastname@example.org; Jim Nickell, National Century Financial Enterprises Inc., 789-1196 or email@example.com; Andy Coen, Norman, Jones, Enlow & Co., 228-4000 or firstname.lastname@example.org
Joan Slattery Wall (email@example.com) is senior editor of SBN Magazine in Columbus.
They're not blowing smoke
How to institute a smokeless workplace policy
By Joan Slattery Wall
Central Benefits Chairman and CEO John B. Reinhardt Jr. distinctly remembers the day he threw his cigarettes in the trash can and-cold turkey-quit his two- to three-pack-a-day Winston habit.
It was, in fact, shortly after Oct. 13, 1986, the day Central Benefits enacted a smokeless workplace policy-one including the tenet that the company would never again hire anyone who uses tobacco products. To further reinforce the policy, the company in 1990 decided that all potential hires would be urine-tested for nicotine.
Central Benefits sees advantages, including decreased costs, related to the policy. Average absenteeism hours are fewer for the company's nonsmoking employees than smokers, who were grandfathered in, says Human Resources Manager Bruce A. Schwartz. He adds that hospital admissions for respiratory-related illness are lower among Central Benefits employees than in the general Central Ohio community.
Even though employees who used tobacco products at the time of the policy decision-nearly all of whom were smokers-were not forced to quit, Reinhardt had a feeling he ought to set the pace.
"I was in the cessation program with many of them," he says of his employees, noting that although many of them quit or cut back tremendously, some-including him-haven't entirely dropped their tobacco habits. Although he's never had even a puff of a cigarette since he quit, Reinhardt does enjoy the occasional cigar away from the office.
The impetus behind the program was a sign of the times, Reinhardt says, noting that in the early '80s employers were designating smoking areas of their buildings. Since insurance is Central Benefits' line of business, executives there decided to take a more radical, proactive role.
"We really just took the step and said, 'We're going to make this a smoke-free environment,' " Reinhardt says. "Twelve years ago, that wasn't in vogue. To take another step of not hiring a smoker and actually testing for it was a really bold step."
He's glad he took it.
Now that Central Benefits' smokeless workplace policy has been in effect for nearly 12 years, the company estimates that, to its knowledge, less than 10 percent of its nearly 400 associates use tobacco products, compared to approximately 30 percent in 1986.
Those figures have translated into lower costs.
For example, a study of comparably sized companies insured by Central Benefits showed that Central Benefits has 17 percent fewer hospital admissions for respiratory illness, and costs are 27 percent lower based on shorter hospital stays, says Schwartz.
Absenteeism also is dwindling at Central Benefits. Nationally, on average, 2.4 percent of work hours are utilized as sick-time benefits, Schwartz says. That is about 50 hours per year per employee.
"We run about 36 hours per year," he says. "So our group is healthier, I believe."
He estimates that, based on salary and benefits, a smoker costs the company an additional $335 per year just in lost time.
"That's only the tip of the iceberg," Schwartz adds. "The lost time is also then going down to the [loading] dock three to four times a day for 15 minutes [to smoke]." This is the only area where those grandfathered into the policy are still permitted to exercise their habit.
Central Benefits wastes no time in screening potential employees to reject tobacco users. Ads for openings at the company state, "We hire drug and tobacco free applicants only."
For those who then choose to apply, department managers reaffirm that the candidate has read point No. 3 of the application: "I certify that I do not smoke or use any tobacco products."
Schwartz recalls trying to hire a qualified candidate for his own department.
"That person came to me and said, 'I smoke.' I said, 'Interview's over.' We're serious about it."
So serious, in fact, that once a candidate successfully completes a series of interviews, he or she is sent to the Industrial Medicine Clinic at Columbus Community Hospital for a drug and nicotine test. The test costs Central Benefits $30.75. Less than 10 percent of the candidates test positive for nicotine, Schwartz says, but those who do are rejected.
Any Central Benefits employees hired after the policy took effect will be fired immediately if they are caught smoking anywhere-even if a supervisor sees them smoking outside of work hours-on the premise that they lied on their application. Employees who were grandfathered in also face disciplinary action if they smoke anywhere on company premises except the loading dock. A first offense generates a written warning, a second offense results in three days off without pay, and the third offense brings termination.
No one has been fired on those grounds, Schwartz says, and to his knowledge no employee has challenged the Central Benefits policy.
"There is no legislation for making those that use nicotine a protected class," Schwartz says. "So you can selectively hire people."
He cautions that the policy has to be applied across the board, however.
"You can't say this person could be so valuable to this company, we'll forgive this. You can't say we'll do it for exempt and not for non-exempt. Then it becomes discriminatory," he says. Central Benefits extends the policy to hourly and part-time employees, too.
To help facilitate a smokeless workplace, Central Benefits offered free smoking-cessation programs to employees and spouses.
"I think it's in good conscience that you'd have to offer that to your associates before you just close the door on them," Reinhardt says.
He admits that the policy of not hiring tobacco users might not work everywhere, and the results his company has seen cannot be generalized.
"The demographics are such that I think plenty of studies would show that the [Central Benefits] population doesn't tend to smoke maybe as much," he says. "If you were in an industry ... where individuals are more accustomed to smoking, trying to implement this kind of a policy would not be very smart."
Looking back to the days when Central Benefits had a smoking environment is almost surrealistic, Reinhardt says.
"I recall having meetings in our boardroom-it's a room about 20 by 30-and in that room would be 20 people, 15 of whom were all hospital administrators. And I would say, very conservatively, that at least 15 out of the 20 had a lit cigarette the whole time the meeting was going on in that room," he says. "When you think about it, it was a terrible environment."
How to do it
For free information about setting up a smoke-free workplace policy, contact:
- Bob Jones, health programs coordinator, Columbus Health Department, 645-7498. He provides consultations and printed information.
- Helen Schinagl, project director, Tobacco-free Collaborative, 240-7420. She provides model policies and refers employers to health agencies in the area that offer smoking-cessation programs.
- Health educator, Franklin County Board of Health, 462-3160. The health educator provides sample policies and assistance in writing or establishing a smoke-free workplace policy.
Put out the welcome mat
Gary Quick says that if potential employees knew about his information-technology consulting firm, they'd want to work for him. So he's inviting them in to hear his story.
By Joan Slattery Wall
Having trouble recruiting employee candidates? Throw them a party.
It worked for Gary Quick, president of Quick Solutions Inc.
The party, technically, was an open house at the Polaris information technology consulting firm, attended by 83 candidates who were invited by existing employees, newspaper ads and in-house recruiters.
Within a month, Quick Solutions had hired a half-dozen of the attendees after in-house recruiters followed up on résumés and registration cards filled out at the event. Some attendees even called the day after the open house to request an interview, says John Yeager, team leader of Quick's recruiting department.
"Just coming in and talking to one person from the company is a lot different than mingling and talking to the owner and the vice president and the consultants," Yeager says, comparing the traditional interview process to the open-house concept.
Quick drew potential employees to the evening event by featuring a speaker from Oracle Corp., who talked about a new database product, and by giving away a Pentium II computer in a random drawing of attendees. He kept them there with games, including a dartboard where participants earned points toward free software, and a buffet catered by Big Bear. Of course, Quick also capitalized on the opportunity to give his own sales pitch of sorts on the company, as did some of his employees.
"We have a story we want to tell, and if you can do it in person, it's a lot more effective than over the telephone," says Quick, who's been an information-technology headhunter for 20 years.
The approximately $5,000 that Quick invested in the March open house was well worth the effort, he says; in fact, he plans to hold more this year, including a summer event that could include entertainment.
One idea behind the open house is to inform and put to rest questions that potential candidates have about making a career move. After all, 95 percent of the consultants Quick hires are already employed somewhere else and are looking for an upgrade.
"They say making a job change is right up there in the top five or top 10 stressful things," he says. "We try to address that."
Quick's recruiters are continuing to contact participants, hoping to add further to the company's 170 consultants. He hopes to grow his staff to 300 by the end of the year.
The open-house concept could work for other industries as well, Quick says. His advice: "If you believe you have a good story to tell, be sure to tell it. And have some of your staff there telling them that. Real-life testimonies-I think that really sells."
Other suggestions Quick offers to attract-and keep-employees:
Every new employee is sent a gift basket shortly after hire, a move that costs Quick $30 apiece but gains him more comments and cards than anything else he does.
Managers are all promoted from within and Quick stays accessible to employees to avoid giving them the out-of-touch corporate feel from which many of them came.
Every employee works with a manager to create a professional development plan with goals that not only will keep them on the leading edge of their field but also will make them motivated to improve. "We believe here when you're green you grow, when you're ripe you rot," Quick says.
Quick gives monthly awards for performance, and managers review each employee every six months.
"You can't treat people like hardware. They have a mind, they have a voice, they have a need," Quick says. "People need to feel like what they're doing is beneficial to the company."
"We do prohibit our supervisors from having a dating relationship with anybody within their location," says Fred Gunderson, senior director of human resources at the Columbus-based restaurant chain.
Enforcing the policy, however, isn't always so simple. Each case is addressed individually, Gunderson says, based on the facts and circumstances. Responses can range from a reprimand to a suspension and even termination. The company also has resolved issues regarding romantic workplace relationships by transferring one or both of the individuals within the 11,000-plus employee system.
"The relationship itself is always different," Gunderson says. "The other thing is the credible evidence that you can determine in the investigation. Sometimes you get really good evidence-you have witnesses-and sometimes it's one person's word against another."
In one recent case, a supervisor called one of his store employees at home for no business reason. Although employees and supervisors can maintain friendships, in this case the supervisor did not indicate that he had a friendship with the employee. Both parties acknowledged what had happened, so the investigation wasn't complicated. That supervisor received a reprimand. Disciplinary action could have been more severe if there was a more blatant violation or if the supervisor had been warned previously.
White Castle relied on its legal department and outside counsel to develop the policy in the early 1980s at the same time it implemented a sexual-harassment policy. Aside from the concern that harassment charges or lawsuits could be filed if romantic relationships between supervisors and employees went bad, the company needed the policy to deal with the practical day-to-day business concerns of special treatment. The policy does not include a nepotism clause since White Castle has relied on three generations of Ingrams to lead the family-owned business into its 77th year.
"In most of our operating areas we have no problem hiring relatives," says Gunderson, who has a nephew working as a shift manager at one Columbus location. "In fact, I think that speaks well for a company-that employees want to bring relatives and friends in."
The owner of Irene M. Ward & Associates joined the Hilliard Chamber of Commerce about four years ago and took advantage of its business medical insurance group plan through Anthem Blue Cross and Blue Shield. What she didn't know was that she could choose her own broker for the plan.
A client of hers, Tim Harrington, group-benefits manager for Great Lakes Risk Management in Toledo, offered to be her broker and has since taken time to explain to her the benefits she's paying for through the chamber.
"We didn't even know we had a $15,000 life policy," Ward says. "I'm finally getting service and at no [extra] cost."
Her chamber policy also provides pharmacy cards, eyeglass and dental coverage, as well as doctor visit co-pays.
Harrington does not charge Ward to be her broker; he is paid by the insurance carrier. Harrington advises business owners to check with a broker to determine whether they have the same choice as Ward; not all chambers allow that flexibility to their members.
Using a broker, Harrington says, helps the business owner like Ward who does not have time to research all the plan designs, carriers and costs available. Owners should choose a broker the same way they would choose other professional services, such as attorneys or accountants, Harrington says.
"Talk with other business associates who have had good experiences with them, and go on word of mouth," he says.
"Chris Campbell, a former executive vice president of ABB Inc., told me ABB never made money with the large companies-big profits," Melendez remembers. "The ones they made money with were the medium-sized companies, the $200 [million] to $800 million companies."
Campbell, a retired COO of ABB's Columbus offices who serves on Glomark's board, says the reason midrange companies net better returns is because larger companies use their power of negotiation, and price is usually the biggest issue.
"I found with the medium-sized companies, they were much more understanding that there was more to what they bought from you than the price," Campbell says. "If you served them well over the years, when they would negotiate with you, they would take that into account-that you did more than provide something for a price."
The ideal situation, Campbell told Melendez, would be to find a very small company that would appreciate Glomark's information technology consulting, training and software services-and would remember them later when the company became more successful.
Still, Melendez saw the success he was having with billion-dollar clients. ABB was, in fact, his first big fish, and soon after came Hewlett-Packard Co. That list eventually expanded to include Nationwide Insurance Enterprises, Microsoft Corp., Motorola Inc., IBM Corp. and others. Those clients helped Melendez's 7-year-old company grow to $1.3 million in annual revenues.
"I have benefited," Melendez says. "But if I would have put in my effort and done what I did with big companies with medium-sized, I would have been more successful. I would be bigger, and I would have less problems. I shouldn't say I regret it. I still do business with big businesses, but that's not our target anymore."
Getting an 'in'
Melendez founded his company in 1991 thinking he'd do business with smaller corporations-those with revenues of $20 million to $80 million. Most of the big fish, he figured, wouldn't care about him.
But smaller businesses gave him small projects and often didn't come back for more, so Melendez started to actively seek multibillion-dollar companies to join the couple of big-name clients that had already fallen into his lap. He used to work at ABB, so gaining that client was fairly easy. Hewlett-Packard bought his services after attending a seminar he gave in Columbus. The rest would take more work. In fact, it required a long, multistep process, Melendez soon learned.
First he had to choose his target. He wanted companies that were growing, that were purchasing new services rather than keeping a large internal budget for maintenance, and that didn't have complex layers of management and politics. He found such companies by doing research on the Internet, with industry experts and in trade magazines.
Then he had to find the right person within his target company.
"I would say there are two rules of thumb," Melendez says. "One is to think about what area in that organization could use your product. No. 2 [is] what person in that organization would personally benefit if he uses your product-meaning he is going to feel good because he accomplished results.
"In our case it's sales vice presidents of vendors of technology like Microsoft and, in the case of buyers of technology, we deal with the information systems group-the top person there, the CIO," he says.
And then there's the obvious: Find the person who signs the checks, but be sure it's the person who can sign for the full amount of your product. Some lower-level executives may not be able to authorize purchases above a certain dollar amount.
Name-dropping didn't hurt, either, in recruiting big companies. Without his references for work with ABB and Hewlett-Packard, Melendez says, he would not have gotten in the door with Microsoft.
Melendez's complex formula for attracting multibillion-dollar companies worked well, allowing him to recruit about 15 heavy hitters in five years. But the process was time- and money-consuming.
"We lost hundreds of thousands of dollars those first years," Melendez says. "We had to invest a lot to get to the big guys."
Melendez fell into a trap he says is common for small-business owners who go after big clients.
When he gained Microsoft, he was so excited about the prospect of working with such a big catch that he put almost his whole 10-person staff on the project. In addition, Melendez personally was spending 80 percent of his time-including weekends and evenings-working on the account. Because of that, when other customers sought his services, he had to tell them it would be a few weeks before he could get to them-and they went elsewhere.
"If you're not smart enough to keep part of your time selling to other companies, if something gets pretty bad or goes sour with this big company and they kick you out, you are out of business," he says.
Melendez says once he was almost in that very situation.
"What you have to do about that is just tell them, 'I need some time.' Normally big companies say, 'I want it and I want it now.' You have to arrange your resources so you spread it over time," he says.
Melendez also learned, when seeking multibillion-dollar clients, that it helps to find another small business servicing the same account in order to learn how to do business with that company.
"The most important thing is the culture. If you understand the culture of an organization, you may be able to work with the organization if you can keep up with it," he says. "For example, at Microsoft they are very intense. So things have to happen very fast. When they ask for something they expect immediate response."
Another necessity in dealing with the big players: attention to detail, especially in payment terms and delivery policies.
For example, Melendez got burned several times before he learned the pitfalls of doing business with big companies that want him to do work in other countries. On at least one occasion, he gave the client a quote, delivered the service in the foreign country, and received payment of 40 percent less than what he charged. He later found that under the big company's rules, the buyer had to take its foreign rate of tax out of his payment.
"If you know that ahead, you can put that in your terms. You either raise your price or make the [domestic] company be accountable to you," he says.
In another case, which he declined to detail because of ongoing litigation, he signed a contract with a multibillion-dollar company after reviewing it with company executives-but not a lawyer. Now, he's fighting to win back his intellectual property-methodologies he provides in his training programs.
With all the investment and effort needed to work with larger clients, it's harder to make a profit, Melendez has learned.
"They bring the price down. They're tough negotiators. They demand a lot more. They have economies of scale to squeeze you," he says.
To prevent this, smaller vendors need to form a staff of both senior analysts and junior players to keep costs down, or else they need to specialize, says Michael Boster, chief information officer for one of Melendez's big-company clients, reSOURCE PARTNER Inc., one of the Borden family of businesses in Columbus.
"You've got to find a niche where there isn't a lot of competition," he advises. "Once it becomes a commodity service, it's a price game."
Melendez has also learned to avoid agreeing on a lump-sum price for a project. Now, he negotiates for a daily rate, or, if he must make a lump-sum agreement, he states the maximum number of days he will work before charging more or terminating the project.
A new perspective
Once Melendez tired of clearing all those hurdles, he decided to test the theory that midsized clients generate better profit margins. He quickly saw results.
"By experience we learned the sales process is faster; it's easier to access senior managers; they don't have big staffs so they can look to things outside; they are growing," Melendez says. "Since they're growing, they need help."
The process of recruiting clients in the $200 million to $800 million revenue range, such as software companies PLATINUM technology inc. near Chicago and National Computer Systems Inc. of Minneapolis, also takes less money.
"When you're calling on medium-sized companies, they even say, 'Well, let me come and see you.' But the big ones, generally they say, 'Well, if you want to do business for us, you come and visit us,'" he says.
Once he gets the work, Melendez doesn't have to discount his prices, either.
"For example, if I go to a medium-sized company with my training services, I could say, 'I'll send you a consultant at $3,000 a day.' They say, 'Fine.' But if I go to a big company, they say, 'All the consultants we hire we never pay more than $2,000,'" he explains.
At first, negotiating a lower rate seemed agreeable to Melendez because he knew big-company projects generally took longer, so he could gross more. But because such projects were larger, he often ended up needing more people and more time than expected, causing his profits to drop.
"Unfortunately," Melendez says, "very large companies are not good partners for small companies."
That's not to say all of his billion-dollar-company contracts have been headaches, or Melendez would have made the decision to change his focus years ago. The most important variable: people. Dave Foster, vice president and general manager for ABB Power Controls, puts pressure and demands on Melendez like most of the billion-dollar companies, but Melendez says he's fair.
"You go and say, 'Dave, we are not making money on this.' He'll sit down and talk to you about it. They will look for a win-win," he says, adding that he has had the same experience with Boster at reSOURCE.
"In the final analysis, no matter how big the item is that they're buying, people buy from people," says Melendez's adviser Campbell. "They look and see your product, then they're really looking beyond that, trying to say, 'Who's behind this, and are they really going to serve us well?' These days it's harder and harder to do that. So many big companies are merging, and at that point the personal side of it gets lost altogether.
Lewis R. Smoot Jr. has a goal. He wants to be CEO of the Smoot Corp., the company his father, Lewis R. Smoot, and grandfather, Sherman R. Smoot, have built to nearly 300 employees and $110 million in revenues since its 1946 founding.
Recently promoted to vice president in the Sherman R. Smoot Co. of Ohio division, the youngest of these three Smoots knows hell need guidance to attain that goal.
The old saying used to be Follow in someones footsteps. My father says, Dont follow in my footsteps; make your own tracks, Smoot says. But I can always look over into his footsteps and see what he did.
While Smoot realizes a lot of his training will come from his father and other company officers that have more years of experience than I have, he also follows the Smoot Corp.s dedication to further education. Employees, based on performance, can go to school at the companys expense. Education is essential, he says, not only for personal development but to compete in the changing construction industry.
We have to keep up with it, or we will be lost in the shuffle and just another contractor, Smoot says.
He takes advantage of any professional seminars or training programs that come his way, like the Ohio State University Fisher College of Business Executive Development Program he attended in 1996. That program taught him how to deal with employees and better understand finances.
Training and education may also fulfill a personal goal, as it has for Marci White, owner of home-based ProtoCall Inc. in Upper Arlington, which produces on-hold messages for businesses. Last month she completed the requirements for an undergraduate degree from Ohio Dominican College after a span of 11 years.
Some executives also return to the classroom with a specific mission, like Mary Robinson, owner of the Pie Place in the North Market. Through the Ohio Foundation for Entrepreneurial Educations FastTrac II program, Robinson devised a business planand made her 10-year-old business 15 percent more profitable.
More doors have been opened for us because of more people weve met since the class, Robinson says, adding that shes expanded her business in areas such as catering.
Joe Bioty chose the same path. As president of the industrial division of Lake Shore Cryotronics Inc., a 150-employee Westerville company, he had been struggling to teach himself how to write a business plan when he learned of the FastTrac program.
We were in business and, as I like to explain, we were a house of cards. What we really needed to do is build a solid business plan, he says of his division, which supplies measuring devices for velocity and position control on machines.
The plan he developed provided a road map, enabling him to introduce products, double his divisions employee count to 40 and realize sales growth of between 40 percent and 60 percent.
The road these executives traveled helped them see the value of continuing education and training, a realization Smoot says his father never let go.
At his age of ripe old 63, he is still learning things, Smoot says. So what makes me think that at 40 I dont need to learn anymore?
Continuing their personal development, though it came with benefits, was not a smooth path for these executives.
My brain was starting to hurt every single week that I went, laments Robinson, who at age 60 had only taken a smattering of classes in baking and business since she receiving her college degree in 1967.
Although her classes were held in the evenings, Robinson found that the program took her away from her business at times. She put 16 hours a week into the 12-week FastTrac program, studying on her day off and even skipping work another full day each week to tackle her coursework.
The evening FastTrac classes made life easier for Bioty, however, since he was able to work each day, but the coursework and business plan took a toll on his family commitments.
I took the family on a Thanksgiving vacation, and the plan was due the next week. I spent my entire weekend behind closed doors with my laptop computer, Bioty says.
White could empathize.
I felt like everybody sacrificed some for me to pay those tuitions, she says, referring to the business income she used to pay her $1,200 tuition every six weeks to acquire her business administration degree. We didnt do without, but there were things that were a little tighter than before.
Still, her family was supportive.
My husband tried to pick up and take over for me in a lot of ways, and my kids have cheered me on during my tests; theyve always asked me my grades, she says. When I dont feel like going to class, they push me out the door.
White chose Ohio Dominicans Learning Enhanced Adult Degree programalso called LEADbecause it allowed her to focus on one course at a time and attend class one night a week to finish her degree in two years. She had already struggled through 11 years at Ohio State, fitting in classes whenever she could, to complete the first half of her bachelors-degree requirements. She needed to make time to get it done.
Time, however, was the hardest element to come by for all these executives.
There are a lot of other commitments that you just have to give up, White says. Thats the bottom line.
The results these executives saw after venturing back into the classroom quickly made up for the struggles to get there.
When I came back, I told my father thats the best $10,000 thats been invested in me, says Smoot, who gained a new realm of business knowledge through the OSU program.
You learned that in business everyone has the same problems as you do, he says. The only difference is what you produce.
Smoot specifically gained skills in employee-relations issues, realizing the importance of operating as a team and seeking others opinions.
You have to listen to people in dealing with people. You cant go into a situation with a preconceived notion of what the outcome could be, because youve only heard one side of the story, he says.
Robinsons gains were more tangible. Shes got a better handle on the Pie Places paperwork, and her business is more profitable than ever. The key to pushing up her profit margin, she says, was realizing her prices were too low.
What FastTrac taught me was to stay competitiveto stay right in line with the other competition, she says. People think that because you have a lower price, your products arent as good. So when I raised my prices, I sold more pies. Isnt that funny? I thought when I raised prices I was going to scare [customers] away. They never said anything about it.
In fact, shes now selling approximately 10 percent more.
Bioty was so impressed with the FastTrac program that he stayed on after graduation and became an instructor. In addition, hes started a network notebook, which he uses to keep in touch with instructors and the business peers that were his classmates in order to share ideas and invite them to speak in his classes.
White applies daily what she learned in school.
For me, the accounting and statistical classes were a challenge but certainly helped me to be able to look at my financial statements better and have a clearer understanding of what theyre really saying, she says.
Smoot, a self-proclaimed advocate of change, plans to continue furthering his education.
As long as I am able, I will be learning something to make myself better to help this organization and to help the community, he says. If you dont cont inue to change in your life, my saying is your pond will become stagnant.
When Rich Terapak, a law partner with Porter, Wright, Morris & Arthur, needs to meet with a colleague in one of the firms out-of-town offices, he travels no farther than a conference room in his own building at 41 S. High St.
Thats because in October 1997, the firm began leasing a videoconferencing system.
The decision has paid off in time and cost savings by facilitating communication among offices in Cincinnati; Cleveland; Dayton; Naples, Fla.; and Washington, D.C. The use of videoconferencing also has reduced travel and time when attorneys meet with clients or co-counsel and has provided a means of training personnel at all offices from just one site.
Making a smaller world
Communication is critical for Porter Wright, which, in addition to its six offices, has clients in 61 different countries and all 50 states.
Videoconferencing has eased that task for both internal and external communications, Terapak says.
When you have 250-plus lawyers in six offices, some nearly 1,800 miles away, theres a need to have to pull together, for internal meetings, management people in each of those locations, he explains. Sometimes its better to communicate face-to-face on a number of issues, and flying everybody in from Washington or Naples or Cleveland just doesnt make much sense. It takes a lot of time, and costs a great deal of money. Lawyers have one thing to sell and thats their time.
One of his responsibilities is to hire partners for the firm, so he uses videoconferencing to gather colleagues at each of the offices to discuss recruiting efforts.
In addition, he heads up the firms health care group, a burgeoning practice representing thousands of doctors and doctor practice groups. Videoconferencing allows the attorneys to share expertise in that area and others.
We dont need somebody whos an expert on Medicare or Medicaid fraud or abuse in each office, Terapak says. For example, through videoconferencing, an attorney in the Cleveland office can talk to an attorney and his or her client in the Cincinnati office to clarify an issue.
Its really a much better use of talent, he says.
Videoconferencing cuts out the need for travel, too.
Each month, the attorneys who specialize in health care gather via videoconference to discuss not only case status but also new regulatory matters.
A lot of that can be done via e-mail, Terapak notes. But its helpful to have someone stand up and give a presentation in Washington about a major class action going on and have everybody see them do it and project graphics.
Videoconferencing also has facilitated the firms efforts to train its counsel and staff. The Columbus office, for example, can give a presentation on tort legislation for associates in all offices. That presentation can be recorded for later viewing by associates unavailable at the time of the videoconference.
Getting a clear picture
The decision to consider videoconferencing came in late 1996 when, during budget meetings, the firms partners looked for new technology that would enhance its competitive edge and bring the offices closer together.
A team of information systems and marketing associates assessed the firms options and eventually decided to lease six videoconferencing systems, one for each office.
Business owners who dont want to invest in the purchase or lease of a system can use off-site facilities, such as those available at three Kinkos locations in Columbus. Chris Miller, general manager of the downtown Kinkos, says the videoconferencing facilities there are used at least once a day, primarily by doctors and lawyers.
Over the course of the past year, weve seen a lot of increase in use, Miller says. I think that the word is getting out there that this is a less expensive way of doing business.
For a conference between any of Kinkos 133 video-equipped U.S. locations, the cost is $150 per hour per site. The system can connect up to seven different locations at once. To hold a conference between a Kinkos and non-Kinkos site, the costs begin at $185 per hour per site. Multipoint conferences among Kinkos or non-Kinkos locations start at $225 per hour per site. All sessions, scheduled through Sprint, are billed in minute increments, and the minimum charge is for a half-hour.
We get the conference started and then we step out of the room, Miller says. Its completely private. If there are technical problems that come along, were certainly available to work that out.
Gary Falter, information systems director at Porter Wright, says using an off-site videoconferencing facility was never an option for his firm because of the frequency of use and need to connect the six offices. The firms system, manufactured by Andover, Mass.-based PictureTel, is valued at $30,000 and connects through Ameritech. The firms accounting department declined to specify Porter Wrights lease payments, but Tim Neely, video solutions consultant with Ameritech, says costs depend on the type of system.
For example, a low-end system that costs $5,000 to $6,000 to purchase would lease for $150 a month. Those systems are generally desktop or compact/portables.
In contrast, a system costing up to $45,000 might lease for about $1,200 a month, he says, but features would include very strong audio, larger monitors, document cameras, auto-tracking cameras that focus on each speaker, and the ability to function with up to 30 people at a site.
To fulfill the firms need to tape-record sessions and have the highest-quality video, Porter Wright chose to lease higher-end units.
Another consideration for Porter Wright was the need to add digital phone lines. Neely says those lines cost $135 to install, then $42 per month plus usage.
Falter points out that because Porter Wright uses three digital lines to obtain better-quality video, the firm pays three times the rate of each long-distance videoconferencing call. When conducting a multipoint call, Porter Wright uses a bridging service offered by MCI, which also adds to the cost. The bridging service ties in each line to connect all parties.
Other features of Porter Wrights choice: a document camera to show charts and graphs, and the ability to link to a computer, for example, to do a PowerPoint presentation.
Seeing is believing
To encourage use of the system, Porter Wright held two days of hour-and-a-half sessions to train its staff with demonstrations, written materials and question-and-answer sessions. About 90 percent of the staff across all offices participated.
Its a very non-intrusive technology, Falter notes. You can conduct meetings face-to-face much as you would a voice telephone call.
In fact, the equipment is so user-friendly that Porter Wright staff does not need the help of an information systems representative during a videoconference.
The system is voice-activated, so the screen shows whichever site has the person talking at the time. The screen also can divide to show all participating sites at once.
Porter Wright staff also have the ability to control the entire system from their end. If, for example, a client goes to a videoconferencing facility without experience in using such a system, attorneys on the other end can operate it.
I think the big trend were seeing is people used to cost-justify videoconferencing systems on travel savings alone, Neely says. But really since the technology has been available in the marketplace for a number of years, companies using it now are justifying it on the soft-dollar savings. Productivity is increasing; cycle times are decreasing; product-to-market times are decreasing.
He says companies also can use the technology to give employees quality-o f-life improvements because they are not traveling as often.
Porter Wrights Columbus staff uses the system daily, if not more often, Falter says. He sees it as a competitive edge.
When he did research for the firm before deciding to lease the system, Falter found that of the top 100 law firms in the country, fewer than 20 percent have any videoconferencing capabilities.
E-mail is such a widespread communication means, I cant hardly imagine conducting business without it, Falter says. Videoconferencing is just another communication means, and at some point in time I think its going to be just as prevalent as e-mail.