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Courtney Lyder was curious. He wanted to know how many of his employees at the UCLA School of Nursing had read the most recent 10-year plan that was about to expire. It was more than 20 pages long and Lyder had a pretty good idea what kind of response he was going to get.

“The answer was very few,” says Lyder, who is dean at the 150-employee school. “My rational was if we have a plan that is 20 pages long that no one is going to read, why do we have it?”

Unfortunately for his team, Lyder had a solution.

“So I was convinced that a 20-page plan is something that no one is going to read,” Lyder says. “And 10 years is a very long time in business. So I said I wanted a new plan that was no more than five pages. They said, ‘You’re crazy. It’s not going to happen.’”

So what do you do when you see something that needs to be done and your people don’t believe they can do it? You can start out by giving them reassurance that they can in fact do it, but you then need to move quickly into selling your plan as to how they actually will do it.

“There has to be a sense of trust between the leader and the employees,” Lyder says. “They have to buy into the sales pitch.”

Lyder talked about how important it is for an organization to have direction. People need to know why they are doing what they are doing and what it actually accomplishes.

“For me, if I don’t have a plan, I don’t know what I’m doing,” Lyder says. “If we don’t know what we are aspiring to, then how are we going to look at tomorrow?”

Lyder needed to sell his team on the need for a plan, but he also needed to sell them on a plan to develop that plan.

“Knowing the culture of my organization, I have discovered that we get much more buy-in when people feel part of the decision-making process,” Lyder says.

So Lyder created a task force. He selected the people for the group because he felt like he could construct a team that would work well together and have a good shot at accomplishing his directive. He didn’t want to force anyone to join it and he didn’t want people who would just give each piece of the project a rubber stamp.

“I wanted people who would critically analyze and look at our brand and the previous plan and ask questions,” Lyder says. “How will we reimagine what we do?”

Ideally, you create a task force that has an odd number of people. And it really shouldn’t have more than 15 people if you want it to function effectively.

“If you have more than 15 people on a task force, it just becomes chaos,” Lyder says.

Once the task force was put together and a chairman was appointed to lead it, Lyder backed off and let them do their work.

“The key is if you’re getting regular routine updates on the progress or lack of progress,” Lyder says. “If I saw after two months that one page was written, that’s when I would intervene. That’s why it’s key for me being the leader to be in frequent conversations with the chair to get my finger on the pulse of what’s going on. It’s not that I want to shape what’s going on, but that they are moving. And if they are not moving, what’s the rationale? Maybe I do need to pay a visit.”

By taking a more hands-off approach while at the same time being an encouraging voice of support, Lyder’s team came through and came up with a new plan that looked at the next three to five years and was just two pages long.

“The key is to keep an open mind as to what the final product may be,” Lyder says. “Get the organization to embrace the document and make it a living document. In this particular exercise, the task force did a sterling job.”

How to reach: UCLA School of Nursing, (310) 825-3109 or nursing.ucla.edu

Give people a voice

One of the key aspects of developing a strategic plan is getting the support of everyone in your organization. You need to make everyone feel like they had a voice in its creation.

Courtney Lyder knew there was no way he could put all 150 of his people on a strategic planing task force and expect to get anything other than chaos. But he wanted those people who weren’t on the 11-member task force to feel like they were given a chance to offer their thoughts.

“We all have our biases,” Lyder says. “We all have to recognize that even the leader is biased to some extent. So you give every single employee ample opportunity to critique and to ask questions. Give them a chance to say, ‘This is crazy,’ or whatever.

Then you can go back to the committee and say, ‘We need to think about this perspective.’ Sometimes we might go, ‘That was a great suggestion. Why didn’t we think about that?’ As long as people think the process is transparent and have an opportunity to critique it, that alleviates a lot of the anxiety about the task force.”

Published in Los Angeles

Esurance’s advertising was not translating into buying customers, and Gary Tolman needed to know why.

“We could see through the actual purchase process and monitoring what goes on through our website that when we got to the end, and the people had to push the buy button, we weren’t getting the conversion rate,” says Tolman, who’s been president and CEO of Esurance Insurance Services Inc. since 1999.

When Esurance began selling its insurance products on the Internet, the company quickly developed a niche in the under-30 market, a group attracted to the low-cost and convenience of buying online. But as more insurance companies moved online, the company struggled to build the kind of brand recognition that stacked up to entrenched competitors such as Geico, Allstate, State Farm and Progressive, which spend hundreds of millions in advertising dollars each year.

“You’ve got the auto insurance industry spending $5 billion a year on ads,” Tolman says. “You turn the TV on and you’re going to see the [Geico] Gecko or [Progressive’s] Flo or Mayhem from Allstate.”

Tolman knew that rather than try to copy the model of companies with far more money and resources, Esurance needed to reposition itself to better reach the customers it could acquire and retain. That meant “aging up” its marketing to reach older, more mature and multicar drivers with higher lifetime value.

“Companies that are going to be successful over the next four to six years are going to be the companies who have the best marketing efficiency,” Tolman says.

“So you’ve got to be good at that to get to your customer at the right time during the buying process.”

Here’s how Tolman has repositioned the brand to attract this new market of customers.

Get some backup

The company designed its 2004 television advertising campaign, which is based on the concept of an animated, pink-haired secret agent named Erin Esurance, with goal of increasing its brand recognition. While it did just that, a competitive analysis showed that customers still didn’t rank Esurance as high in terms of trustworthiness and credibility, which older, established drivers looked for in an auto insurance company.

“We wanted to position Esurance differently than we had in the past,” Tolman says. “Under Erin, we were kind of looked at as the cartoon company.”

That’s where Allstate came in.

“We want to be known as a smart insurance company, one that’s providing a convenient way of providing the policy, one that’s going to provide a lot of information over time, one that’s going to provide great service,” Tolman says.

“I knew what we needed. We needed support in terms of brand.”

According to Tolman, the most important piece of building a successful brand is having the right parent company. While its parent company at the time — White Mountains Insurance Group —was a wonderful partner, it didn’t supply a strong brand name. So when Allstate inquired about purchasing the company in 2011, Tolman saw the perfect parent to give the 12-year-old Esurance more brand power. As an Allstate company, it gained the marketing advantage of a large, recognizable parent with a track record of creditability and trustworthiness.

“Our brand is recognized,” Tolman says. “We’re considered to be innovative and fun, but unfortunately in terms of trustworthiness, we don’t index that high.

“We needed someone like an Allstate, a Traveler’s or even a State Farm to really provide this halo to the Esurance brand.”

So in October 2011, Tolman sold the company to Allstate for an impressive $1 billion. When he’d sold it to White Mountains in 2000, it was for $9 million in cash.

Instead of spending a lot of money trying to build the brand on your own, Tolman suggests finding a partner with the resources and reputation to help you build it.

“You can spend a lot of money trying to build brand,” he says.

“Allstate brings brand, a brand that has a great deal of trustworthiness and credibility in the market. I think that’s going to be huge for us.”

In addition to the name, look for a parent that has products or expertise that can enhance your own offerings for customers. For example, having access to Allstate’s products and expertise now allows the company to move from a mono-lined insurance company to develop bundled insurance products. For customers who already trust Allstate with their home insurance, this is an opportunity to utilize the parent’s brand power once again to convert new customers.

“You need to have something that differentiates you in the market,” Tolman says. “If you have a bundled product, either auto/homeowner’s or auto/renter’s, that makes a big difference.”

Do something different

As an online insurance company, Esurance caters the do-it-yourself consumer, rather than someone who wants to work with an agent to buy insurance. While young people already tend to fit into this first group, Tolman knew that developing a brand message to reach a more stable, mature driver would take more than a new parent company.

“You look at the lifetime value that we would get from those particular segments, and then we realized that we need to move up age-wise and also in terms of getting more people with more cars and multi-drivers,” Tolman says.

“That requires us to shift our message. We don’t want to be known as the cartoon insurance company.”

It would take a new advertising strategy to get this group thinking about the company differently.

“We knew where we wanted to go over time,” Tolman says. “We wanted to age up with our in-force policy holder base. We wanted to acquire people that had multiple drivers, more cars and were married. So it’s positioning the advertising to get to that target market.”

After the acquisition, Tolman began shopping around for an advertising agency that could position Esurance as a professional insurance company, accounting for its new parent in Allstate. He helped whittle down the choices to three agencies before the company went with Leo Burnett from Chicago.

Early this year, the company rolled out a new national ad campaign centered on the tagline, “Insurance for the modern world,” using a series of television commercials narrated by “The Office” actor John Krasinski. In its first campaign since being acquired by Allstate last year, the company examines real-world problems and solutions for customers in a “modern” world, stressing buying factors such as trust, transparency, tools and mobility in choosing in insurance company. In one commercial the narrator asks, “What makes you trust a company? Wait — scratch that — what makes you trust a car insurance company? A talking animal? A talking celebrity? A talking celebrity animal?”

When you don’t have the resources of larger and longer standing companies in the marketplace, Tolman says your advertising needs to really convince your target customers why it makes sense for them to have your company’s products.

“We just didn’t want to go out and preach savings, savings, savings,” he says. “We wanted to say that there are different things you can do.”

Stay nimble

Today, Esurance does business in 30 states, and with its new parent, Tolman expects that to increase that number to 40 over the next few years. But even as a big company with close to $1 billion in revenue, the company continues to think small and move quickly, especially when it comes to planning its brand and marketing strategies.

“We’re constantly tweaking where we’re spending our dollars,” Tolman says.

“We can be in a position where our online marketing is extremely effective for six months and then they’ll be some activity in the market where some companies get more aggressive, so that becomes less effective.”

While he is much more careful about taking risks when it comes to pricing or product design, Tolman says businesses must take risks in areas such as marketing where there is significant pay off. Being data-oriented allows you to see quickly what’s working and what isn’t so that you can take the right risks, which is why Esurance lets metrics drive many of its marketing decisions.

One of the company’s key metrics is customer conversion, so it spends a lot of time updating and tweaking its website to lead customers to the point where they purchase a product.

“You can do some marketing that drives a lot of traffic but has lower conversion rates,” Tolman says. “You can do other marketing that’s more expensive but it’s probably going to have higher conversion rates.

“We’re always looking at how we should change the website in terms of the questions asked. How should the page be displayed and what should be on the page?”

Tolman says in order to stay ahead of customer trends, businesses need to look beyond just what competitors are doing and see what successful businesses outside of their market are doing to build their brands. Also, think two of three years out so that you are continuing to be innovative in the type of marketing you use and the channels that are most effective. This is always changing.

In the case of the Erin Esurance campaign, the advertising met the needs of the brand at the time, but eventually the campaign was right for growth.

“Certainly with Erin, that was very effective in getting brand recognition,” Tolman says. “That was very different back then. Insurance companies were not using cartoon advertising. It was quick and it was flashy and it got to the market that we were targeting, which was more the younger, single insurance.”

The fact that people are now looking for information not just from sites, but through online reviews and social media channels, is what prompted the company to start a bigger dialogue with consumers through Facebook.

“We’ve changed how we’re positioning ourselves in social media,” Tolman says. “Now we certainly are pushing people to make comments about us on Facebook.”

Because the market is not stable, business leaders need to be aware that the things that work today may not work tomorrow. Remain flexible in your marketing just as in other areas of business. To get optimum value with your marketing dollars, Tolman suggests staying attuned to where you are getting most of your leads from — whether it’s in television, radio or online — while also being prepared to readjust spending.

“As a direct-to-consumer company you need to be nimble,” he says. “You need to move quickly as the market changes.

“We take some risks in areas and we launch new features in marketing and IT, but we look very quickly at whether they’re working or not. If they’re not working, we see if we can get them to work or if we just kill them.”

How to reach: Esurance Insurance Services Inc., (800) 378-7262 or www.esurance.com


1. Find parent companies that lend brand power.

2. Develop marketing and advertising that appeals to your audience.

3. Listen to the market to stay ahead of industry trends  .

The Tolman File

Gary Tolman

President and CEO

Esurance Insurance Services, Inc.

Born: Keene, N.H.

Education: University of New Hampshire

What do you like most about your job?

What’s interesting about insurance, particularly auto insurance, is that people need it. It’s a product that people have to have. Certainly it’s a very competitive market, but it’s not something you buy when it’s nice, when you have some extra money around. You’re required in all states to have auto insurance. So even though it’s become more commodity-like over time, it’s something that people need. And you know they’ll be a market there. Also, generally competitors are responsible competitors.

Why Esurance chose online: We launched the company and we tried everything. We tried print ads. We tried TV ads, which I can tell you were terrible early on. We tried direct mail. We were unsuccessful. Then online is where we found our sweet spot.

On the decision to “age up” the company’s marketing:  Over time, we could see what was happening in our particular market segment. You could look at the people who were 20 to 30 and see how long they were staying with us, how many people were on their policy, how many cars they had, and then you compare that to the people 30 to 40 and 40 to 50. You need to acquire the customers and then you need to retain them. If you have a lot of younger, single-car drivers, they tend to move quite a bit.

Published in Northern California

Eric Lofquist and Magnus International Group Inc., go about business in a rather nontraditional manner. The 50-employee manufacturer of organic components for eco-friendly products does business through a very collaborative process where customers often agree to buy products before they are even made.

Magnus, which has annual revenue just shy of $100 million, is primarily a company that takes materials that are traditionally made out of petroleum and designs a replacement product based on renewable, sustainable materials.

“What it was in the beginning was we had an idea and you’d have to take it to the customers,” says Lofquist, co-founder, president and CEO. “Now it’s to a point where the companies we do this for think about it and they call us and ask, ‘Can you make this or make that, or have you ever thought about this?’ So now the information is traveling both directions.”

Smart Business spoke to Lofquist about how he has grown Magnus International through trust, collaboration, and planning.

Collaborate. It takes a little bit longer to grow when you’re developing new products and you’re looking to get those products approved and into production. One way we have found to reduce the time to get those out to market is to already have them presold. If we can make this for you, if it’s going to be around this price point, if it’s going to have these characteristics, are you a buyer?

What you end up doing there is you end up having a partnership. You’re an extension of theirs because you’re getting an agreement ahead of time and you’re telling them all your secrets, so you need to have someone you can trust and they need to be able to trust you too. They’re saying, ‘If you make that, yeah I’ll buy it.’ It’s really collaboration between two companies without there being a formal joint venture. It can be a little tricky at first, but once you get established and you do it a couple of times, then you build that reputation and that ability to move pretty quickly through the supply chain.

Have a plan. We have a good platform in place right now and 2012 is going to be all about new products and new brands all setting the stage for the next big growth spurt for us. Our current brands are going great, so it’s how do we leverage that and how do we do more of what we’re doing and how do we do more of that with the people in Northeast Ohio?

Anyone out there that’s been successful has to start with understanding what their customers want long-term. The deeper you get into their long-term plan, then the deeper you can get into your long-term plan. If your long-term plan doesn’t match up with what your customer’s long-term plans are, then you’re not going to meet your final objectives. We spend a lot of time understanding what the long-term objectives are and they change, so you need to be on top of them. At least on a quarterly basis you have to check if you’re still on the same path. It’s a constant check and balance on what they’re doing and what you’re doing and making sure that there’s no gaps and you’re working on what they’re working on.

We have a plan and we share that with them and they have a plan and they share that with us. That goes back to trust because the information that we are passing back and forth is very confidential information and it takes years to build that report up. Once you have it and you show that it can be trusted and sustain the deeper you can get into what they’re plans are and how you fit into them.

Trust your employees. We do things differently than the way most people do them when it comes to our business. We have to have people that are willing to look at the business not in the traditional way that new brands are developed and taken to market. Your employees have to believe and have that same trust. The door swings both ways on the trust because we’re asking for information and we’re provided information and it has to flow evenly both ways.

Over the years the key employees have really understood that and have looked at things differently than a traditional development market and it takes time. You can tell them all you want, but they have to see it and they have to feel it and they have to be part of it in order to buy-in and understand it. Then they can move it forward because you can’t do it all on your own. You have to have people that believe and have the same focus on the strategy.

HOW TO REACH: Magnus International Group Inc., (216) 592-8355 or www.magnusig.com

Published in Cleveland
Thursday, 31 May 2012 20:15

Victoria Tifft: Components of risk

As a CEO, I am often asked to describe the top challenges of leading a business. There is no doubt that setting a vision, creating strategy, and building the right team are at the top of the list. At the same time, one of the most important challenges is to understand and mitigate the risks associated with all aspects of the business.

Years ago, our firm didn’t have a risk management tool or strategy to mitigate risk. We’ve since learned that it is the one management strategy that we can’t live without. Business risks today are comprised of strong internal and external forces, so mitigating both forces is critical for long-term survival. If business leaders don’t have an in-depth knowledge of their industry and how they play in their market space, then they will undoubtedly forge ahead with incorrect and misdirected strategies, costly mistakes for a firm.

Understanding and mitigating risk is not as difficult as some would want you to believe, but it does require three components: a firm application of discipline, unrelenting tenacity and an acceptance of reality. Today, our firm manages risk by applying each of these pieces.

First, a firm application of discipline is applied to every area of the business. We list all of the possible internal and external forces that could present an opportunity or threat to our firm. Internal risks include whether the firm has adequate or inadequate infrastructure, capital, expert resources, technology and facilities for business today and in the future. External risks cover market segments, industry trends, competition, and customer supply and demand, as well as global economic trends. Publically held firms must do this type of analysis on a routine basis. If you have not conducted this type of risk assessment, you might try looking at the annual reports of publically held firms similar to yours. This information is free online and can often jumpstart a brainstorming session with your management team to determine what risks might be similar to your business.

Secondly, an unrelenting tenacity must be applied to ensure that each area of the business is examined. Paranoia is essential. If something can happen, then add it to the list of potential risks. We take the entire list of risks and place it in a spreadsheet. Next, we determine a numerical threshold of acceptable risk for each area, placing a score in the column next to each risk. In a column next to the risk threshold, we then list the strategies that we will implement to mitigate the risk. On a quarterly basis (or more if conditions change), our leadership team reviews our current internal and external risks and revises the risk and associated threshold as needed.

The last component that we adhere to is the acceptance of reality. When examining risk, it is important to be realistic. This is not an area to defend product or service territories or allow “gut feelings” to dictate strategy. The market does not understand emotions, complacency, or turf wars, so your leadership team needs to be frank and candid about their real business risks. Try asking outside advisers, researching industry publications, and talking with partners and competitors to share views on current and future business risks. The local economic development corporation, chamber of commerce and small business administration are also good places to gather information.

Finally, there isn’t a business on the planet that has eliminated all of its risk. Understanding, embracing, and mitigating risk is part of doing business. In the end, companies that are realistic about their risks and manage them carefully will pull ahead of those that choose to ignore the risks around them.

Victoria Tifft is founder and CEO of Clinical Research Management, a full-service contract research organization that offers early to late-stage clinical research services to the biotechnology and pharmaceutical industries. She can be reached at vtifft@clinicalrm.com.

Published in Akron/Canton
Monday, 30 April 2012 20:01

Nariman Teymourian: On the battlefield

Situational awareness is a fundamental part of managing a team when you’re on the battlefield. It’s imperative that you know the terrain and the environment you are entering. You need to have the right equipment to get the job done, and you need to understand the enemy — your competitors.

For example, if you’re doing a beach landing, you need equipment that doesn’t get you stuck in sand. The last thing that you want is to jump out of a plane with your flippers on, only to land somewhere other than in the water. It sounds simple. But you would be surprised how many of these simple principles are overlooked in planning.

The Marines teach clear and concise planning, which is also valuable to you as a corporate leader. You must formulate a very clear business strategy. It doesn’t have to be the ultimate plan or remain unchanged for all time, but it has to be a plan that you and your team believe in. In an environment that requires everyone to work very hard — whether it’s because you’re getting the business off the ground, changing direction, going through difficult financial times or up against a big, competitive threat — it’s vital to have a strategy that you can communicate clearly and will be understood by those following you.

While he or she must have a strategy and a plan of action, a leader also needs to make sure that the plan is flexible, understanding when and how you will need to adapt or improvise in the future. Marines are taught the key skills of improvisation, adaptation and perseverance, particularly in times of duress. There is no room for fear, because it will only cripple you. Instead, make sure you have a plan that accounts for many possible outcomes and can adjust depending on how these outside forces affect it. You may be banking on a strategy, but you should be flexible enough to adopt a new strategy and execute on it when you need to. If you see things aren’t working with Plan A, you should always have a Plan B and be prepared to implement it. That said, if you and your team believe you have the right market and the right product, you should persevere until success is achieved and your mission is accomplished.

Lastly, it’s valuable to learn strategies on how to identify problems in advance and how to identify your leading team members. You don’t always have a chance to contact HR when you’re on the battlefield. This isn’t necessarily the case in most of corporate America, but in companies that need to be agile, it’s important to understand the issues that employees are facing in advance, before they become a problem at a critical time. When it comes to planning effectively, people are always the key to success or failure. So staying aware of your people’s thoughts and feelings, and of course, taking time to judge yourself as a leader is a critical piece. Do you look at yourself honestly to deal with your own strengths and compensate for your weaknesses?

In the business world, you must know the market you’re in — what world you’ll be landing and fighting in — so that you can know whether or not you have the right equipment to win there. It is critical that you have the right product, the right team and the right mindset for the environment you’re going into, but don’t forget, it also takes a well-thought-out strategy to ensure success.

Nariman Teymourian is chairman and CEO of Gale Technologies. He spent 20 years in the Marines, including seven years of active duty in Marine Recon and four years of combat, he and participated in more than 50 missions. A CEO and COO for more than 15 years, Nariman has held executive positions in several large companies, including TRW, MicroAge and Lockheed-Martin, and he has extensive government experience as a senior adviser, consultant and researcher with the U.S. Departments of Energy, Defense and State and related government agencies such as the RAND Corp., Council on Foreign Relations and the World Bank.

Published in Northern California

When Dan Myers and his partners capitalized Bridge Bank N.A. in 2001, it was the largest new bank IPO in the state of California at the time. More impressively, they did it during the most brutal economic downturn in Silicon Valley’s history. Even then, the biggest challenges were still ahead.

“We expected to grow rapidly, and based on experiences at other banks that were also somewhat recognized as high growth models, we understood and appreciated that we would transition rather quickly from a de novo, to a $250 million bank, to a $500 million bank to $1 billion bank, and the infrastructure and risk management challenges inherent in each of those milestones were significant,” says Myers, the founding president and CEO of the San Jose-based company.

In addition to its differentiated business model, which focuses exclusively on business – not on retail, the bank’s strategy involved executing a high-growth business model. From the beginning, the founders were cognizant that the company needed to be able to handle change extremely well if it were going to be successful with this vision.

“We had to be adept at change because regardless of economic environment, the company was going to go through some accelerated phases of growth in an accelerated manor that demanded we be good at change,” Myers says.

To ensure that everyone in the company was proficient at change management, Myers and his team knew they needed to weave it into the culture of the bank itself.

Stay several steps ahead

To handle the continuous change that comes with fast business growth, Myers realized that the bank couldn’t afford to not plan ahead when it came to its strategies, infrastructure and growth goals.

“You have to think ahead, not only a couple of quarters or to the end of whatever fiscal year you’re operating in,” Myers says. “You have to look down the road one to five years, which most banks do on a strategic basis. But their five years we’d be looking at in one to two years.”

Proactively building up your infrastructure prepares your company for fast growth by enabling a smoother transition from one phase of growth to the next. This allows you to focus your attention and resources on the core business, such as finding good clients that fit your target profile, soliciting new business and producing the results for its shareholders, rather than trying to constantly re-adapt a long-term strategy.

“We would never want to be in a position where we’re playing catch-up,” Myers says. “So we’d build infrastructure, we’d build capabilities before we actually needed them. When it came time to execute at that higher level, from an internal cultural management perspective, we would already be there.”

To develop a culture of forward-thinkers, it’s important to talk to employees about what kind of growth you are anticipating so they understand why it is important to create a culture that is accustomed to change.

“A lot of that success was focused on explaining that to the bankers that we had already hired, the founders and making sure that as we brought people in they understood not only were we going to execute a sound bank business plan but we were going to do it in a way that would anticipate this high growth and prepare for it,” Myers says.

Myers and his team also spend a lot of time talking to employees, customers and stakeholders about how the company’s value proposition is being received by clients and the bank’s more active referral sources in the community – that includes professional services groups such as CPAs, attorneys, venture capitalists and investment bankers, in addition to the management of all the companies who bank with Bridge Bank on a direct basis.

Having this dialogue is helpful to stay on top of trends and shifts in thinking among key groups in your industry, allowing you to adapt proactively.

“We took it a level higher and said we want to be even more differentiated in that we’re going to be the only true professional, business bank operating at the community bank level in our region,” Myers says.

“So it’s the constant, ongoing conversation are we offering the value proposition, products, services that are relevant in doing what they’re supposed to do for their clients,” Myers says.

The company recently expanded this effort to include brand analysis, which seeks input from its stakeholders and also from prospects that it didn’t manage to turn into customers.

In today’s tough environment, it isn’t easy to attract new clients and retain them for growth, so it’s critical to be part of the industry conversation if you want to be successful tomorrow.

By planning ahead, the bank has been able adapt quicker than many competitors in times of great change, including through two significant economic downturns.

“It’s making sure that we’re questioning those out in the market and getting feedback to expand our target,” Myers says.

Be clear on strategy

When looking at how to set up Bridge Bank, Myers and the other founders analyzed the structure and organization of other local de novo banks — banks that have been in operation for five years or less. What they figured out was that in California, the average de novo community bank would grow to anywhere from $300 million to $500 million in size in a 10-year period. Yet Bridge Bank planned to grow even faster than that.

“We were intending to be roughly double that in the same amount or a lesser amount of time,” Myers says. “So our time horizons were moved up a little bit with the same challenges imbedded in them.”

To execute this growth efforts, he felt it was even more important that the company set clearly defined goals for the bank and its employees for how they would achieve growth.

“You need to understand your organization, not only what it really is — and that’s a challenge, too — but where you intend it to go,” Myers says.

He says that much of his time goes toward developing a culture and communication system to make sure the growth strategy and vision remain clear for everyone.

“There can be a disconnect that develops over time,” he says. “You simply have to encourage the folks that you rely on to run various aspects of your business to keep you informed in an accurate way so that you can manage accordingly.”

It’s beneficial to have a communication system that provides top level management accurate, honest input and feedback so that your top leadership can best understand the organization as it matures. Because fast growth companies tend to be adding new employees all the time, part of that involves devoting significant time and resources to encouraging open communication within your organization.

In other words, talk to people.

“I know it’s a simple concept, but as you grow very rapidly you have people coming in from different organizations,” Myers says. “You have a constant mix and evolution of culture. You really have to proactively develop lines of communication, methods of communication and provide people with the tools to communicate effectively.”

This helps you avoid falling into what Myers calls the “big bear trap” of pursuing areas that are not consistent with your primary model, a pitfall he’s observed for many banks.

“Over the years, it’s been important to remind our folks from top to bottom in the organization that it’s not only critical to focus on what we said we’re going to do,” he says. “It’s to have the discipline to stay away from things that we know are not complementary, which again is running counter to what most other larger banking organizations have done even in the last 10 years.”

Engage people in decision-making

As the second or third startup for many of its founders, Bridge Bank has had the benefit of an experienced leadership team throughout its growth. Yet from this experience, Myers and his partners have also learned that leaders cannot be the only ones coming up with ideas if they want their company to flourish. It is collaboration at all levels that gives companies the greatest advantage when planning for the future.

“Our best solutions for managing the challenges as the company continues to grow don’t necessarily come from the top,” Myers says. “Some of the best ones come from team building and teamwork at all levels of the company, top to bottom, as they work at their own individual levels on different aspects of those challenges.”

By asking people to play a more active role, you empower them to make decisions so they can take initiative to solve problems and come up with solutions or ideas proactively. Being able to acquire clients and build the bank’s business today relies on this efficiency in decision-making. Therefore, the bank’s culture is built around continuous improvement and finding new ways to grow its value proposition, no matter what the economic climate looks like.

The No. 1 driver of this culture is recognition, both verbal and financial.

“It lets us all continuously look for ways that we can improve everything that we do in a positive, constructive context so that we can execute better, we’ll take better care of our clients and we’ll have better performance not only for our shareholders but then how that comes back to our employees in terms of the ways they benefit with their relationship to the bank, including compensation,” Myers says.

“Although we have an economic recovery under way, it’s tepid at best. Therefore, your growth aspirations are really driven by your competitive positioning and abilities to take business from competitors. The overall growth in the economy isn’t going to float all boats.”

Engaging people in your company’s growth goals is more successful when it comes in the form of enthusiasm rather than censure. When you reward people for bringing ideas to the table about how your company can improve its performance, it helps them engage in innovation as a challenge to do better rather than a disapproval of the way thing are being done.

“Unfortunately in some companies it is a form of criticism,” Myers says. “You can do this better — do it better.

“Going hand-in-hand with the collaboration and teamwork, if they identify a challenge within the company, we encourage them to recommend a solution and a way of dealing with that challenge at their level with decision-making authority. That encourages an efficient resolution of whatever the challenges but also understanding that there’s accountability that goes with that.”

Today, Myers says the bank continues to focus on developing its bankers and its change management culture to stay competitively positioned for high growth.

Through continuous effort to take better care of its clients, the bank not only survived through the worst of the financial downturn but actually had its best years for new client acquisition and issuing new credit commitments. Over the last 10 years it has grown organically to some $1.2 billion in assets in 2011, an increase of $131.3 million from just the year before.

“It’s that core competency of change management that served us well when we launched in worst economic environment in Silicon Valley, which has since been bested by the great recession,” Myers says.

“When the banking industry as a whole was really taking it on the chin from a PR and creditability perspective, we had our best years at bringing new clients in, which I think says something about the validity of our value proposition, how it resonates in the market and how our people have executed in delivering that value proposition so that it’s appreciated for what it is.”

How to reach: Bridge Bank N.A., (408) 423-8500 or www.bridgebank.com


  1. Stay ahead of the game.
  2. Set clearly defined goals.
  3. Use teamwork to make decisions.

The Myers File

Daniel Myers

Founding president and CEO

Bridge Bank N.A.

Born: Dayton, Ohio

Education: DePauw University, liberal arts. Pacific Coast Banking School, Seattle, Wash.

First job ever: I bailed hay part time.

First job after college: Pacific Valley Bank in San Jose, Calif., as a reconcilement clerk

Who are your heroes in the business world and why?

Entrepreneurs. They have the vision, the can-do-anything attitude, and perseverance that is the basis for new company and new job creation, even in the face of monumental challenges in today’s environment.

What do you do to regroup on a tough day?

Take our golden retriever, Belle, on a long walk. She’s a good listener.

What is your favorite part of your job?

At Bridge Bank, I get to meet and work with so many exceptional and interesting people, including the entrepreneurs, business owners and all of the top tier career professional business bankers that have joined me at Bridge Bank.

Published in Northern California

As the president of the traveling exhibition company, American Exhibitions Inc., Marcus Corwin knows that creating the “blockbuster” exhibitions that the public wants to see involves creativity and ingenuity. But it also takes a lot of patience and upfront research.

“You don’t get Broadway successes overnight,” says Corwin, who joined the Boca Raton, Fla.-based exhibition company in 2006. “Most of them don’t make it. So how do you create something that people are going to want to see, that they’re going to be excited about, they’re going to be engaged?”

The company must develop new products all the time that it knows will resonate with customers. Corwin says that step one is figure out what fascinates and excites your potential audience — a million-dollar question for any business. This was the goal he had in mind when the organization developed its Mummies of the World exhibition, which focuses on a topic that has fascinated people for centuries.

“When Pepsi or Coca-Cola go to design a new soda, they’ve gone and done some focus groups, they’ve done some development, spent money on marketing,” he says. “And as good as they are, sometimes they get it wrong. So with regard to how do you find a product that you want to bring to market … sometimes we have it in our gut.”

Part of creating a hit with customers is having a sense for what the public wants by doing your homework and knowing who your customer is. By looking at similar exhibits that resonated with consumers, for example, Corwin was able to recognize trends toward subject matter such as human anatomy. The fact that these exhibits were extremely popular with consumers around the world evolved into the concept of mummies.

“Our thought process was what else would be people interested in seeing, because people are always interested in their history and the cultures that came before them,” Corwin says.

From there, it’s finding out how much they like it, what aspects resonate and most importantly whether they will pay and how much they will pay for it.

“We went and we had focus groups here in Florida,” Corwin says. “We had focus groups in Boston, Mass., and we had focus groups in Philadelphia — all which helped us identify the public’s perceptions of mummies and the public’s needs of why they choose an exhibition to come to, why they chose a museum to come to, how they spend their money and what are their trigger points in coming to see an exhibition like mummies.”

With focus groups, it’s important to examine a variety of feedback. Corwin specifically wanted to know which points of interest appealed to the majority of the audience, what price points could turn that interest into business, and which marketing materials were inviting versus frightening.

In the end, the company was able to put together the largest collection of mummies ever assembled in history from Egypt, South America, Asia and Oceania.

“We’ve had over 500,000 people see the exhibit already,” Corwin says. “Over 85 percent of them liked the exhibit a lot and would recommend the exhibit to their friends, family and relatives.”

Corwin says that when you have a product that’s successful, you need to then be asking yourself questions such as “What is our progression of additional product?” and “How do we continue to grow?” so you are always building on success.

Since the company opened the exhibit, it has done exit surveys at every location to determine what drove customers to attend and what they did and didn’t like so they can continue to improve the product. Now that it has built this brand and knows that people like mummies, Corwin says the next venture is to create sequels, such as Mummies II.

“From my company’s viewpoint, it’s almost like being at the helm of an ocean freighter,” Corwin says. “When you’re at the helm of an ocean freighter, you are looking way ahead, because it’s going to take you a period of time to shift the direction and speed of the ship. So I’m looking not one year out, but where am I going to be two, three, four, five years out with our company.”

How to reach: American Exhibitions Inc., (561) 482-2088 or www.americanexhibitions.com

Considering costs

In any kind of strategic planning, budgeting is very important. When you’re putting on a nationwide exhibition for thousands of people, it’s critical to map out your budget as clearly as possible so you can deliver for your partners and customers.

“The budget and forecasting is the premise of why you’re going forward with a project,” says Marcus Corwin, president of the exhibition company American Exhibitions Inc.

This was the greatest difficulty for Corwin and his team as they planned for “Mummies of the World,” especially because the economy is so uncertain.

“Sometimes we’re in a strong economy,” he says. “Sometimes we’re in a weaker economy. You can only make the best effort that you can do, but sometimes with the outcome, you are powerless.”

Once the budget and forecast make sense, being able to execute on that successfully involves a number of factors. One of the most important things to keep in mind is not getting carried away with ideas that haven’t been thoroughly vetted and can end up draining more resources or money than you have available. By making sure you are effectively planning and managing the costs, you can deliver your product at a better cost and profit.

“You have to deliver your product within those parameters,” Corwin says. “We found like typical in all worlds, designers have great ideas. And sometimes those ideas are pie in the sky and you have to be able to make sure that those ideas work, those ideas work within a budget and that the exhibit can be produced within that budget.”

Published in Florida

It was a moment that was “make or break” time for Douglas H. Yaeger’s future at Laclede Gas Co.

In 1993, massive flooding was occurring throughout the central United States, including territory serviced by Laclede. Among the many things homeowners had to be worried about was the effect of the flooding on their gas lines.

“Houses were underwater and water was infringing our system,” says Yaeger, who was senior vice president of operations at the time. “Parts of our heavy pipelines where the ground support was, the actual dirt that was around the pipes had washed away and the pipes were floating in the water. We knew when the water went down, we were going to have to do something relatively quickly or the weight of the pipe would not hold itself.”

The burden to come up with a solution to this crisis fell on Yaeger. His response was to lead an effort to drop quick-setting cement bags into the water to create new support systems for the pipe.

“They set up as cement so when the water receded, we had a trellis that was holding up the pipe,” Yaeger says. “We backfilled it with dirt and everything was great.”

It was a defining moment for Yaeger, who ultimately went on to become chairman and CEO at the 1,622-employee natural gas utility, which generated $932 million in 2011 revenue.

It was a defining moment for Yaeger, who ultimately went on to become chairman and CEO at the 1,622-employee natural gas utility, which generated $932 million in 2011 revenue.

Defining what it takes to be ready for whatever challenges you might face is rather simple — it’s your ability to develop leaders in your organization. Just as others had put Yaeger in position to be ready to deal with the flooding crisis when he became CEO, it was up to him to do the same for the next generation of talent.

“Quite frankly, it makes the employees that much more involved in the mission of the organization so they feel like they are really current on what’s happening inside and outside the company,” Yaeger says. “They see and feel that they are a meaningful and important part of the execution of the strategy. Companies that don’t take advantage of that are not going to operate on an optimal basis.”

Yaeger retired early this year from his position leading Laclede, but he took some time to offer his thoughts about clearly identifying the problem you face and then developing a team of people who can help you solve that problem.

Identify a clear problem

Much of leadership is about solving problems such as the one Yaeger faced in 1993. But one of the things that can create trouble for leaders is when they don’t really take the time to figure out what the problem really is.

It’s not always as plainly obvious as massive flooding that is uprooting your gas lines.

“You get to the senior levels of organizations where not everything is an operational problem or a financial problem and not everything is earnings driven,” Yaeger says.

Yaeger learned about the gray area where problems often live during a 13-week senior management program at Harvard Business School.

Participants in the program met six days a week for 13 weeks and would go over three case studies a day regarding problems that had occurred at prominent companies such as Frito-Lay and Nike.

“You’d go through it and come up with what you thought was a really profound definition of what the problem was and a profound response to that,” Yaeger says. “You’d be sitting there and you might give your two cents worth and then you would sit and listen to five other people and you know what, they had five different ways of getting to the same place. Sometimes it was a completely different view of what the challenge was.”

The exercise was trying to teach leaders that not every problem is as clear-cut as it might seem, even one as seemingly obvious as the floods of 1993.

“What they really try to get you to do is sort through the noise of an organization and really get down to the basics,” Yaeger says. “What are the drivers of what’s going on? Make sure you’ve got the problem defined correctly. What’s driving that problem? What are the real solutions, not what the superficial stuff might be.”

Yaeger says it’s easy to get wrapped up in a certain mindset when you become a leader to the point that your vision becomes very narrow.

“There are a lot of people who run companies who come up through the financial side or they are attorneys,” Yaeger says. “But not everything is financially driven and not everything is legally driven. There’s a lot of operational, marketing, supply, etc. You need to make sure you’re not relying on what’s comfortable to you because that’s what you know. You need to be able to look through the organization with kind of open eyes and a clinical approach to the other functions as well.”

It’s perfectly logical that someone develops a skill, hones that skill and uses it to advance up the corporate ladder. But you need to keep broadening your skill set beyond what you already know and so do the people you want to train as leaders.

“At a certain point, you have to go from being a specialist to a generalist so that you have the ability to oversee multiple functions, multiple disciplines and multiple departments,” Yaeger says.

“As was typical in the utility business years ago, you become kind of a siloed employee. You come into the company as an accountant and you retire as an accountant. There is certainly room for people like that; I’m not dismissing that. But in terms of successful management development, you really want to challenge those people to see what their capabilities are and allow them to develop and give them an opportunity and the authority to do that.”

Always be learning

Yaeger spent a lot of time at Laclede evaluating people and considering their potential to be a leader in the company.

“That’s really the key of a successful manager,” Yaeger says. “Keep an eye on those folks who have that capacity and give them the opportunity to demonstrate it. Make sure they understand that their key to success is their ability to broaden their capabilities and not just be a single-subject specialist, but much more of a generalist.”

As you’re evaluating your people, give them opportunities to contribute to matters that affect the company as a whole. Take the situation at Laclede in recent years where the supply of natural gas has increased significantly.

“That’s a benefit for us and it’s an opportunity to grow our markets and build and leverage that stability of both supply and pricing that we haven’t had in quite a while in the gas business,” Yaeger says. “So from a standpoint of empowerment, it’s really letting my folks know and really directing them toward much more of an aggressive and offensive approach to expanding markets.”

Ideally, Yaeger doesn’t want to be the one being aggressive and offensive in expanding into new markets. He wants to create an environment where his leaders feel the pull to do that on their own.

“I view my role as one to help set the vision and the strategy and then get out of the way and empower people to execute on that strategy and that vision,” Yaeger says. “But certainly be available and be there to jump in and get into the nuts and bolts if need be. It’s their job to execute on that and it’s my job to make sure they are doing it in the right direction and that they have the resources and assets available to them to execute.”

The role of teaching and developing is one that never really ends, at least if you want your leaders to always be on top of their game.

“If you get to this position in any organization and you think you know everything there is to know about the job, that’s a guy I’m going to keep my eye on because I just don’t think that’s necessarily the truth,” Yaeger says. “I don’t care what part of the company you are in. The company is changing and the marketplace is changing and that is a factual state of growth. There are always new challenges and there are always new things to learn. You can always improve and you can always do what you do better.”

You can’t throw your leaders into a critical situation where decisions have to be made if they are not ready and if making the wrong move would put people at risk. At the same time, it is important to present as real a scenario as you can to help leaders feel what it’s like to make decisions while under pressure.

“We do a lot of simulation and regular testing of our plans,” Yaeger says. “When we do have a situation where those plans and those types of reactions in the real world have to be enacted, we do post mortems afterward to see what we did well and what we need to improve on.”

By getting people involved in simulations and combining that with discussions afterward, you can get pretty close to making sure they are ready for a big challenge when it occurs.

“We sit down and we clinically look at how we handled the situation,” Yaeger says. “What could we have done better, what we did exceedingly well and if there were areas we didn’t anticipate. Did we overemphasize certain areas that maybe technology has changed so we don’t need to focus on as intently anymore?”

Continue to evaluate people just as you should continue to evaluate your own skills and job performance as CEO.

“We do 360 Evaluations where we have subordinates, superiors and peers all evaluate their management style and the way they treat people, the way they handle emergencies, the way they go about executing on strategy,” Yaeger says.

“Have the ability to critique yourself. Self-critique how what your vision of what the company should be is matching up with what the marketplace’s vision and your employees’ vision is. Sometimes you find out that what you thought was dead right wasn’t. So you have to accept that nobody is perfect.”

If you find out as your training someone else that the individual doesn’t seem to have what it takes to be a leader, you need to take that person’s attitude into account to determine the appropriate next course of action.

“There are people who turn out to be very good competent accountants and that’s what they’re going to be when they retire and that’s fine,” Yaeger says.

“Not everybody can run the company or be in senior management. It’s those that don’t meet the expectations and don’t show the flexibility and the ability to adapt to the implementation of strategy that you say I don’t think the fit is good and it’s probably best for everybody that you find somewhere else to work. But we try to make that the exception, not the rule.”

How to reach: Laclede Gas Co., (800) 887-4173 or www.lacledegas.com

The Yaeger File

Douglas H. Yaeger, retired chairman and CEO, Laclede Gas Co.

Born: St. Louis. Yaeger grew up in Webster Groves, Mo.

Education: Undergrad degree in marketing, Miami University, Oxford, Oh.; MBA, Saint Louis University; Advanced Management Program, Harvard Business School.

What was your first job?

Probably the best job I ever had. I worked in the concession stand at the Webster Groves public swimming pool. I got a dollar an hour, all I could eat and all the girls you could meet at the swimming pool. It was a great job.

Who has the been the biggest influence on you?

I’ve been very fortunate to work with and for a lot of different people both here at Laclede, and before, who had good Midwestern values and a lot of integrity and just were good human beings. I think it’s part of this industry. I feel really blessed that I had that ability and opportunity to work with some really fine people almost throughout my career. Is there one? No.

Who would you like to meet?

I’ve always been intrigued with Winston Churchill. He was an interesting person and from what I’ve read about him, not a particularly likeable person. He just happened to be at the right place at the right time to provide the kind of leadership that England needed at the time when they needed it. I’ve always intrigued by him.

Published in St. Louis

In the United States, workers’ compensation insurance is the second biggest cost for employers, representing a $50 billion marketplace nationwide. So when Steve Mariano built a company focused on sales of workers’ comp insurance, he knew that there was opportunity for long-term growth.

“Workers’ comp insurance — it’s not a really sexy area, but it’s been around for a long time,” says Mariano, founder, chairman, president and CEO of Fort Lauderdale-based Patriot National Insurance Group. “It’s kind of like this small brother compared to health insurance.”

But since the credit crisis, it has also become more difficult to compete in this type of insurance business. In the last three years, declining payrolls and cost cutting at many companies has inevitably affected sales for Patriot and other workers’ comp insurance providers.

“It was always a tough business, but it’s gotten a lot tougher these days,” Mariano says.

To grow, Mariano has stayed true to many of the same principles that the company was founded on in 2003, specifically a commitment to finding and developing a team of unparalleled talent.

“That’s probably been the biggest reason why we’ve been successful,” he says. “We’ve been able to attract the talented people and their skill sets and we’ve been able to train the people to do the business, follow the procedures and protocols and leverage technology the way that we at Patriot do it, different than other companies.”

As a result, the organization has had some of its best sales years despite the recession. Here’s how Mariano develops Patriot’s team of 425 employees to excel in the workers’ comp business.

Grow talent in stages

Prior to launching Patriot, Steve Mariano founded two other companies. From experience, he knew that it would be difficult to attract many strong employees with the skills they needed to grow before they got a foothold and developed a reputation in the business. To create a deep bench of talent from the beginning, it’s important to be patient about growth and not bring on people that you don’t truly need yet.

First, develop a core team of people local to your business and who you can trust to get your business off the ground.

“You’ve got to get your business plan up and running with a couple of core people in your management team that you know and have experienced working with them,” Mariano says.

Once you see growth in your business plan after a couple of years, then you have a story to use to attract corporate talent from around the country and from other fields. Bring on a strong core group and grow initial sales and then bring on a strong secondary senior team to continue to grow them.

“With each cycle that the company grows and evolves, you have to balance your ability to sell your product along with your costs,” Mariano says. “This may not be perfectly in tandem — but you can’t have one or two major years of losses coming from the expansion without balancing it out.”

By growing in stages, you can build the infrastructure to support a larger and larger team. That way, you ensure that as you go through hiring cycles that people will see you as a stable employer with a track record of growth. In addition to bringing people from out of town with certain skill sets to the corporate office, the organization has also hired hundreds of employees locally, including about 300 people in the Fort Lauderdale area.

“Once you get to a certain size, it becomes easier to attract talent because, number one, talent starts looking for you,” Mariano says.

By 2006 and 2007, the company’s sales growth put it in the position to hire the senior talent it needed to pull from outside of South Florida. As you add new talent, finding people who are fair and also have good ethics is equally important to finding the right skill sets. You want to hire people who are talented but also people who are ethical and going to fit within the company’s culture, much like a professional sports team.

“You can have the best talent, but if they don’t work together in the same culture, they’re not going to win,” he says. “You’ve got to find the right people that fit within the organization. It’s not just asking who is the best talent, but who is the best talent for our company.”

Mariano says that growing responsibly sometimes means taking it little bit slower than you’d like to make sure that you bring everybody with you. That’s not just in expenses but also growing the culture in a way to make sure it permeates the entire company as you add more and more people.

“Sometimes that just means taking a step back, whether it’s three months, a quarter or two quarters, and focusing back internally on the company and having internal parts of the company like accounting and legal really catch up to the growth of the company,” he says.

But while he tries to be deliberate about growing in stages, Mariano doesn’t place limits on how big the company can become as it continues to scale.

“If you pigeonhole yourself into not thinking of things as big as they can be, you’ll never get there,” he says. “You’ve got to really think about the potential and not sell yourself or your ideas short.”

Invest in training

Employee training is an area that not all business leaders invest in equally, especially in the insurance industry.

“In the insurance business, there is very little training that goes on these days, and I think it’s because of cost overhead and other things,” Mariano says. “Insurance companies don’t have the same type of training programs for young people as they used to.”

Yet training talent is an area that Mariano cites as one of the most critical elements in facilitating Patriot’s sales growth. Fundamentally, the company has had certain departments training on an informal basis for years. An example is the company’s claims management program that started in 2008.

“That type of training and that type of culture that’s been built around our business has allowed us to be successful,” Mariano says.

When you don’t invest in growing people’s skills, they could feel undervalued or feel that they don’t have a long-term future with your company. This can result in higher employee turnover, which in the end, sucks up more time and resources as you hire and train new people.

Retention is a major factor in why Mariano readily invests in employee training that others might find an unnecessary expense. Investing in your people helps your emloyees be more successful, which in turn helps your company be successful by developing and retaining talented employees.

Last year, Mariano introduced Patriot University, the company’s first formal, full-time training program to provide employees with cross-training enhance their core competencies and develop their skills. The company also collaborates with South Florida colleges to put together training opportunities for people who are interested in working for the company and want to learn some skills in advance. This creates a local pipeline of talent so that when the company hires in the future, it has a pool of candidates who already have some key skills.

“We’re proactive now in making sure that we have more than enough talent and with these training programs, making sure that we’ve got the talent and the internal operations ahead of time ready for the next big expansion,” Mariano says.

“There’s no question that we’re going to continue to grow and hire most of our people locally moving forward. That’s only gotten a lot easier.”

Because of its efforts to nurture people up through the ranks of the company, the organization now has one of the best retention rates in its industry.

“If you don’t train people, then you’re not going to keep them,” Mariano says.

“We know if you churn employees, you hire and then fire, hire and fire, it really increases your costs as a company. It’s cheaper to retain them by training them in their job functions and cross-training them in other department skills, so that as one department grows maybe faster than another, we can use their skill sets in different departments.”

Encourage innovation

In an industry with a lot of big players, Patriot’s entrepreneurial culture is one of the reasons many job seekers are drawn to work there. When you have a culture that allows people to have a more direct impact on your business, you can attract the kind of innovative thinkers that can help you grow.

“We have procedures and protocols too, but we’re always looking for our employees to find a better way to do something and to innovate within their organization and within their departments,” Mariano says.

Having an innovative culture that embraces new ways of doing things tends to attract those with the desire to succeed.

“Talent is looking for a way to put a fingerprint on the company they’re working for,” Mariano says. “If you come to work for a company like us, you can really put a fingerprint in your area and be able to look five, ten years from now and say, ‘I really had something to do with this part of the business plan and help with the building of the company.’”

By not having just standard ways of doing things, Mariano says you make it harder for employees to just come in, check a box or work a 9-to-5 just to pull a paycheck.

“We’re looking for ideas of how to better our company in all areas, from the mail room all the way up to the top financial parts of the company,” Mariano says. “If there is a better procedure and protocol or a way to innovate it to service our customers better or make us a better profit, then I ask for those types of things and very much support that type of thought process.”

As a result, the company has been a leading innovator in its field, specifically when it comes to technology. It was among the first to spearhead the use of iPhones, iPads and mobile technology to video stream information for surveillance. Being able to use the mobile devices and video streaming tools nationwide gives insurance adjusters, investigators and legal teams the ability to help employers evaluate compensation or compensability issues and make faster decisions in fraud cases.

Because fraud makes up about 20 percent of the workers’ comp cost in the United States, these advances make a big difference in helping the company differentiate itself for growth.

“Very few workers’ comp competitors really use that kind of Apple innovation on the front end to be able to be out in the field getting this information,” Mariano says.

“It’s billions of dollars being wasted each year in fraud. If you can just stop a small piece of that going on in your own companies, then that is a big thing.”

As a result, Mariano says that the company is planning its biggest expansion in the last three years. Investing in a culture and training to engage employees has helped it attract new talent as well as capture market share from its larger, but less nimble, competitors. It recently opened up offices in the Los Angeles area as well as major cities including Sacramento and St. Louis, and in 2011, the company added 85 new jobs to downtown Fort Lauderdale.

“So we’ve been an innovator,” Mariano says. “We’ve been able to come in, leverage new technologies and really come into the marketplace with a fresh set of ideas and reduce costs for the employers.”

How to reach: Patriot National Insurance Group, (954) 670-2900 or www.pnigroup.com


1. Be patient in your talent search.

2. Create formal training for employee development.

3. Nurture employees’ engagement in innovation.

The Mariano File

Steve Mariano

Chairman, founder, president and CEO

Patriot National Insurance Group

Born: New Jersey

Education: Georgia Tech and Ursinus College — graduated with a degree in economics.

What would your friends be surprised to find out about you?

Most people don't know I read a new book just about every week. There is so much information out there, so many experiences to benefit from.

What is one part of your daily routine that you wouldn't change?

My morning workout. Mental and physical shape are linked, and the time I spend every morning at the gym helps me clear my head, set my priorities for the day, and build the energy I need to take on the day's challenges.

What’s the toughest business decision you’ve ever had to make?

At our prior company right after 9/11, the marketplace for insurance really shrank, and I was in a situation where I had to eliminate about 85 to 100 employees just because the business model wasn’t supporting it. To me, any time you have to eliminate a position or you have to fire someone, from a leadership position, you haven’t succeeded. Any time you have to let someone go, that means you either didn’t train them correctly or they weren’t able to deliver what you thought they would be able to deliver. Or in the case when you just have a bad event like 9/11 — you just have no control over it – it’s even harder because as a CEO you have great people sometimes and there’s just nothing you can do about it.

What do you see for future growth in Florida?

I think South Florida and Florida will do a lot better over the next couple of years. I know it’s been very tough for the state in a lot of areas … and I think just given the amount of business that we’re doing with Latin and South America, and just how wonderful a state this is — no state income tax and all of that — there’s a good balance for its growth. We’re really bullish that there’s going to be better times ahead, and we look forward to being part of the community here.

Published in Florida

The fact that Tom Strauss sees some major flaws with the national health care system shouldn’t just raise eyebrows for hospitals or the patients in them. As CEO of one of the largest integrated healthcare delivery systems in Ohio — employing 10,000 people and more than 1,000 physicians across seven hospitals — Strauss knows the problem is one that affects every person in the country.

“I think everybody would admit that what we have in health care in this country today is unsustainable,” says Strauss, the president and CEO of Akron, Ohio-based Summa Health System. “When you’re spending $2.5 trillion, 17.6 percent of the GDP on health care and the health premium now for a family has exceeded what a minimum wage worker makes in a year — think of that … it’s going to affect the way that we do business.”

The glaring problems with the current care model have been compounded by the increasing number of people without health insurance, which creates a shrinking base of patients from which hospitals can generate any income — the sick ones.

“We’re really a sick care system, which means when we get paid traditionally in hospitals, it’s only by treating a bunch of sick patients,” Strauss says. “So if a good flu season rolls in … our beds are full and we’re billing a lot of revenue, but we have a lot of sick patients. There’s something wrong with that picture.”

With mounting costs, anticipated reimbursement declines and payment model that rewards based on sickness rather than health, Strauss and his team finally said enough is enough. After spending two years devising a new vision for the organization to evolve and improve the system, Summa Health launched a pilot program for an accountable care organization, called NewHealth Collaborative. In January 2011 it moved 11,000 patients in its SummaCare Medicare plan to the new collaborative.

“Some of these places are holding onto the revenue as long as they can because they believe there is a way to survive that,” Strauss says. “We don’t think there is.

“So with us, it’s what do you do to transform yourself to focus differently to create true value in health care.”

Here’s how Strauss has led the implementation of the accountable care vision across the seven hospitals.

Get organized

Because Summa Health is one of the first organizations in the community to create a prototype for accountable care organizations, Strauss knows it will be an example for future organizations in the way it implements its vision and strategy. To make sure the shift toward population health management is successful, one of the first steps is putting in place the right tools, processes and infrastructure to support it.

“You’ve got to know where your vision is, where you’re going and what your objectives with the strategy are and then put in place the executing tactical plans to make that happen,” Strauss says.

Strauss says that a key problem with the old system of that care was it could be very fragmented. With different physicians in charge of different services, handing off tasks and having limited knowledge of a patient’s needs, an estimated 30 percent of what is conducted in health care and in hospitals today is unnecessary.

So part of the transformation has been changing the organization’s siloed infrastructure to create multi-disciplinary approach to services, eliminating the overtreatment of patients and saving costs by keeping everyone on the same page, including the patient.

“People like me have to start to prepare ourselves structurally to be able to do these things for population health and population management,” Strauss says.

“What’s nice is it’s easier to do the right care, the appropriate care, and eliminate this 30 percent that’s unnecessary than to not do it. So we’ve made it easier for physicians to do that.”

Frequently inefficiency is the result of lack of communication and knowledge-sharing. So a critical step to becoming more organized and efficient is looking for ways to improve your technology.

“Some organizations are used to living on very high revenues,” Strauss says. “When you realize that eventually that is going to go away, you have to reposition your organization to be able to function at lower rates of reimbursement.”

Strauss says that the organization is investing $80 million in IT over the span of five years. It has already added a new call center so physician’s phones roll over to the 24/7 call center with care nurses during off hours. The system’s Akron City and St. Thomas hospitals also became some of the first in the country to have computerized physician order entry so physicians can access and manage orders through a portal at any time.

The other piece was implementing new evidence-based medicine protocols and procedures in the care delivery process to integrate the 10 service lines for increased efficiency.

By structuring your organization for more effective collaboration, you can align the people on shared goals and your new vision.  At the same time, you give people a clearer idea of how their role contributes to the big picture of your mission and vision.

“Those are the kinds of structures that you have to have in place to be able to thrive under this new health care reform move towards population health and population management,” Strauss says. “So it’s more than just technology.”

Be an open book

Once they came up with the model, Strauss and his leadership team presented it to the physicians and the board and held retreats to walk employees through the vision, its benefits and how the transformation would occur.

“I think most physicians understand that the old way of doing things is not very effective,” he says. “The days of fee-for service — the reimbursement is just going to be cut and cut and cut. It will be death by a thousand cuts. They understand they can’t survive the way that it is today, so we have to do something differently.”

With most people on board, the real challenge was making sure the 400 physicians and other employees involved could understand, execute and share the vision. Developing strong partnerships among the hospitals and other care providers requires strong alignment on goals as well as new patient care protocols and procedures. So for Strauss, the key to success has been having the organization be as open as possible with employees about the vision, what it involves and any changes being asked of them.

“It’s creating a vision for the future and getting people to understand what that vision is and then educating the components to engage in that process when it might be different than what they were used to in the past,” Strauss says.

“If you don’t, and they don’t believe in where you are going you will be unsuccessful. So for us, we really took the time and even after it was implemented went back to reinforce the vision of why this is so important.”

By explaining how a new vision complements your organization’s core values, mission and culture, you can get more buy-in by aligning people behind shared goals as well as a shared culture. So aside from instituting training and education programs for employees, Strauss has spent a lot of personal time working to put the vision into a clear framework. His efforts include teaching a class for employees called “The Philosophies of Summa,” speaking at monthly new employee orientations and hosting monthly “Talks with Tom” for several hundred employees with representatives from each department.

“There are no secrets,” Strauss says. “I give them financials. I talk about what’s happening good and bad and ugly, and it’s been very effective. It’s information. It’s listening. It’s being by their side and nurturing them when they are down.

“We believe that the employees that work here are the soul of the firm. Your employees represent your greatest strength or your greatest weakness. So they have a culture that supports them — servant leadership — and it says if I’m not serving that patient I’m going to serve you.”

Strauss says that another goal of the open communication is to reciprocate the attitude and culture he wants to drive in the system, which is one of servant leadership and mutual caring.

“The moment of truth is the first 15 seconds when you come in contact with a patient in need, and it’s how you seize that moment to make the difference to satisfy their needs,” he says.

“If you’re too busy or you’re having a bad day or the Browns lost or the Steelers lost, and you translate that at work to your patient, we will fail as an organization.”

To strengthen the mindset they want all employees to have, Strauss has charged managers to be more active in talking to employees and patients to see what their needs are and helping them carry out the vision for accountable care.

“If you’re engaging your work force to go after a vision, then you need to give them as much information as you can about the reason for that vision,” he says. “That’s one of the pieces that I love to do.

“We’re actually making a concerted effort to do rounding with a purpose. You’re going to see every leader at Summa being out more on the floor talking to patients, talking to employees both on satisfaction and safety.”

Motivate results

But once you give people the information, you then want them to drive its success as much as possible. To help employees feel like they have a stake in that vision so they will drive it with enthusiasm, Summa Health has tied more employee financial incentives to the positive patient outcomes it’s seeking from the new care protocols and procedures.

For example, all employees in the system receive a bonus each year based on the company’s financial performance and levels of patient satisfaction.

“We’ve paid out millions of dollars to the employees,” Strauss says. “This is beyond managers. This is all of the employees. We want them to feel like if they produce, if they work with us, if they exceed the expectations of the patients — that’s the definition of quality — they will benefit, their organization will benefit, and we will be the provider and employer of choice.”

Eventually, seeing the positive results of changes helps employees realize that your vision is a viable one.

As a result of its technological innovation, the NewHealth Collaborative received 2012 certification from the federal government for its ability to meet standards of meaningful use guidelines. Its Akron City and St. Thomas Hospitals will acquire $5.1 million in federal incentives, which will be distributed to the hospitals and its doctors.

“In the old days you would just throw services out there and market those services and try to grow this population of sick patients,” Strauss says. “Now we’re going to get paid on the population’s health.”

Although he’s been with Summa Health for 13 years, Strauss believes that the organization is just starting to scratch the service in the excellence it can achieve by transforming the community’s health. Despite the uncertain future of health care reform, he sees more and more people are now realizing that action needs to be taken to change the industry.

“When you deliver that kind of quality and safety and you see the savings we’re starting to generate, you realize that there’s an answer here,” Strauss says.

How to reach: Summa Health System, (800) 237-8662 or www.summahealth.org


1. Put the structures in place to implement your plan.

2. Help infuse the vision with transparency and an open-door policy.

3. Offer employee incentives to drive results.

The Strauss File

Thomas Strauss

President and CEO

Summa Health System

Born: Pittsburgh

Education: Duquesne University for undergraduate and graduate schools. B.S. in pharmacy in 1975 and a doctorate of pharmacy in 1978

What do you like most about working in health care?

That you are caring for patients at their most vulnerable time, you can make a difference in every patient’s life and you can make a difference in employees’ lives. We’re the largest employer in five counties, so for us we take that pretty seriously. And improve the health status of the communities, not only once you educate and take care of patients but you can go out into the communities and you can make a difference.

What mistakes can you make in a growing business?

The first thing you’ve got to realize is that you can’t make everybody happy. That’s the hard one, especially for somebody like me who really prefers to have people holding hands singing ‘Kumbaya.’ The other area is trying to micromanage. You cannot in this environment micromanage. You’ve got to empower your people and let them go. They will make mistakes and that’s OK as long as they learn from their mistakes. I would think trying to stay in the old system, trying to stay in the old ways was a mistake that got us starting to transform toward population health and population management.

What’s the best business advice you’ve received?

Love what you do. If you think about the hours we all work, that gets pretty challenging if you don’t love what you do because I probably put in as many hours here as I do at home, unfortunately. So that’s one. Make sure you love what you do, and if you don’t love what you do, go find something you will.

Published in Akron/Canton