Detroit (1202)

Thursday, 25 June 2009 20:00

Multiple choice

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If you are toiling over what to do about training, you’re not alone.

Tuition reimbursement and continuing education look good on paper and are great recruitment and retention tools, but, as businesses are finding out, in today’s economy, those types of programs could also look more like a dispensable employee perk than a business necessity.

While academics will tell you it’s a mistake to cut training from the budget, those closest to financial reality will suggest trimming the fat and adopting a leaner training strategy that ties education to the company’s immediate needs. For most businesses, this means doing away with the nice-to-have training and focusing on the must-haves that affect the bottom line today.

“If you’re going to continue to grow, if you’re going to make it through the recessionary time, education is critical,” says Merodie A. Hancock, vice president and executive director of off-campus programs at Central Michigan University. “In a bad economy, there’s a tendency of two things to cut — training and marketing — and the loss will kill you. You’ve got to keep investing in them both because the half-life of knowledge is significantly shorter than it was in the past. Everyone needs to stay sharp.”

Keep in mind that the usefulness of what is learned today doesn’t last as long as it once did. Technology’s rapid evolution makes knowledge obsolete when it isn’t built on. Still, the average number of formal training hours has dropped from 25 hours per learner in 2007 to 17.2 hours in 2008, according to Bersin & Associates’ 2009 Corporate Learning Factbook. The report reflects an 11 percent reduction in corporate training spending and claims a trend shift in the types of education that businesses are pursuing.

Goal setting

Training that educates employees on ways to increase revenue or decrease expenses or that improves relationships with customers is a business necessity and has a place in your training regimen.

Determine what your company needs to work on and what areas you need to continue to grow in as well as the basics to keep up with the competition.

“You can’t just throw training at a problem and expect it to solve everything,” says Lisa Kujawa, assistant provost for enrollment management, Lawrence Technological University. “Training is vital for people to move forward in a company, but it must be done in a way that helps meet the company’s specific needs, [and] then is followed up on. Each new employee should be placed on a vertical or horizontal education plan when hired.”

Considering who will be receiving the training is an important step. Being wise about your budget means training those who are in a position to benefit the company most instead of offering a la carte training to whoever is willing to trade a few hours of work for classroom duty.

“Look at the specific issues holding your company back,” says P. Nick Blanchard, professor of management, College of Business, Eastern Michigan University. “Tie training to the strategic plan by looking where the company’s going and not where it’s been.”

Considering the type of education you need has equal importance to the way the education is delivered. While some companies find online courses give employers the best return on investment while saving on travel and driving time, others find in-house courses or a classroom setting to be the best delivery method for employees.

Choosing a trainer

Your company’s goals help determine what institution you’ll use to provide employee training. Look at local colleges and universities first, as these organizations have flexibility in training formats and delivery.

“Colleges are untapped resources when it comes to business training,” Blanchard says. “If you have a partnership with a college, you may even be able to get a lower rate on classes or MBA programs. Educating your employees helps you to always have the best and brightest on staff.”

Universities are often willing to consult with businesses to determine what the immediate training needs are. Community colleges, business schools and specific work force training centers can also provide tailored programs as opposed to off-the-shelf training that serves as a one-size-fits-all education.

Don’t think of continued education as a perk to employees, but think of it as a way to keep the business growing.

A common error employers make is accepting a program where the employee misses a significant amount of work to go to school. Options exist that allow you to dictate, within reason, how, when and where your employees are educated.

“If you aren’t able to get the rates you want from a college, try another one,” Hancock says. “You can also pair up with another small employer to form a large enough group in need (of) education that gives you more financial leverage. If you can fill a classroom on your own, you can say when and where it meets, too.”

After you select a program and a university, your strategy must carry over into measuring tactics. Make sure you have a way to calculate the benefits of training and the reason you have selected the specific program.

“Always think about why you are doing the training, why the people getting the training are involved and what you expect to accomplish afterward,” Kujawa says. “Know what professional opportunities you want to mesh with company needs.”

Measuring results

Before an employee begins training, testing the skills that will be built upon is important. Testing will help determine where the employees’ skills are today and where they need to be after training. Making sure the employee, trainer and you are on the same page with expectations will help eliminate any miscommunication about future performance expectations.

“The college can help you develop a program that works specifically for what your company is looking for,” Kujawa says. “Colleges can really help link industry to education, which, in turn, means you’re helping each other out. You can meet and discuss the company’s needs, then the college takes that information back and gets academics involved to determine the type of class they can offer.”

Prior to training, discuss the reason for the education and the way the training will be measured with the employee. Tell the employee how the new knowledge directly impacts his or her daily responsibilities. Managers should tie the training into performance evaluations to determine its true impact on the enhanced ability to perform.

“Employees may do well on paper, but the true measure is if they can transfer the education back to the job,” Blanchard says. “One way is to figure what the cost of the problem was before training, then see how the training reduced that figure.”

Even after trimming the education budget, some companies say the cost is too much to handle right now. If you still believe in education, but can’t afford it, reassess it in nine months. In the meantime, use in-house training and coaching capabilities.

“Companies often drop education in steps — first eliminate paying upfront, then the amount they pay,” Hancock says. “If you maintain the most important type of training, you’ll never need to look at it as a place to cut.”

Thursday, 25 June 2009 20:00

At your service

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While some banks have stopped commercial lending or curtailed it in the face of economic uncertainty, many are still lending money — you just need to know where to look.

But in addition to finding a bank with available funds and a great interest rate, you need to find one that can service your organization’s needs and with which you can build a solid business relationship.

“The old adage of ‘You get what you pay for’ is very true right now in the banking world,” says Darlene Nowak-Baker, an executive vice president and lending manager with First Place Bank. “People often look at a bank as a commodity, but it’s not. Sure, money is money, but when it comes down to it, you need to partner with a bank that takes time to understand you and your business and will be with you in good times and bad times.”

One of the best ways to ensure that your banking relationships are as strong as they should be is to look at how the bank handles loan servicing, which includes everything that’s involved with your loan after the deal is closed, such as billing, payments of principal, and interest and escrow.

Smart Business spoke with Nowak-Baker about loan servicing, and why a good relationship with your bank is more important than any interest rate.

What should business owners know about the treatment of their loans?

After the loan is closed, the servicing starts. You want to find a banking relationship that is customer focused, and this will be evident throughout the process, which starts with your loan officer.

After the loan is approved, it gets handed off to a portfolio manager, who will have continued contact with you for the term of the loan, ensuring that the bank is doing everything it can and should be doing.

Your loan officer will stay involved, as well, particularly if you have a new or additional loan request.

With a two-tiered point of contact, you’ll know that you have two people at the bank who always have your best interests at heart.

How does the relationship between a business and its bankers work?

On the front end, the loan officer gets to know you and your business. He or she will find out about your business and its nuances, collect financial data and acclimate to you in order to assess exactly what you need, both now and down the road.

Once the loan passes through the credit department, the loan officer works to obtain the necessary approvals and then initiates the closing process, where the loan transitions to the portfolio manager.

This is where you determine that your bank is working for you. A good portfolio manager will maintain an ongoing relationship with you, offering an open line of communication. Your portfolio manager will be there if you have any problems or additional borrowing needs, which is vital, especially in an uncertain economy.

A good, relationship-driven bank wants to be there for you in your time of need. Whether you need cash flow relief, restructured debt, a longer amortization or an interest-only plan, you want a bank that’s willing to do whatever you need to help you weather the storm.

And internally, portfolio managers and loan officers have tight relationships. They’re your teammates, so to speak. So if something does go wrong, they will be there to help you through it.

What does a business owner need to know when meeting with banking partners?

The main thing is to be open and honest. Many borrowers think that if they tell the bank they’re having problems, the bank will pull the plug and their business will go under.

The bank wants to be a partner and help its borrowers through the rough patches. Also, consider the end game: The bank wants to get repaid. It doesn’t want to take a loss.

A business owner needs to be prepared when meeting with a banker, especially in light of this economy. Make sure you have all of your updated financials, interims, accounts receivable and payable, as well as what obstacles lie ahead for you and your business. The more open you are, the better your banking relationships will be.

What problems can arise during the loan process?

The biggest issue is being forthright and honest. Many times, something won’t be communicated in the early stages because business owners are afraid to tell the bank. Then, you get so far down the road, and all of a sudden, a problem comes up.

Most times, if the bank would have known about that issue beforehand, it would have made sure that you never even got into that situation in the first place. It’s easier to handle an issue before it happens, not right in the middle of it.

No matter what problems you may be having — back taxes, property liens, lawsuits, grievances, etc. — tell your banker. More often than not, there is a solution.

Bankers don’t want to play hide-and-seek; they want to help you get the loan you need to grow your business.

Tuesday, 26 May 2009 20:00

Hospital Directory

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Beaumont Hospitals

3711 W. 13 Mile Road
Royal Oak, MI 48073
(248) 898-5000
Kenneth Matzick
President and CEO
Beaumont is a regional health care provider that includes three hospitals, medical centers located throughout the area, nursing homes, rehabilitation facilities and hundreds of doctors’ offices. Beaumont Hospital, Royal Oak is a 1,061-bed major academic and referral center with level-one trauma status and Michigan’s first Magnet-designated hospital for nursing excellence. Beaumont Hospital, Troy is among the nation’s highest-volume community hospitals with 361 beds.
Key services
Cancer, emergency, heart, trauma, cardiology

Botsford Health Care

28050 Grand River Ave.
Farmington Hills, MI 48336
(248) 471-8000
Paul LaCasse
President and CEO
Botsford Health Care is the corporate parent of Botsford Hospital, Botsford Commons Senior Community and Community Emergency Medical Service. Botsford Hospital is a 330-bed community teaching hospital in Farmington Hills. It is nationally recognized for quality, safety and medical education programs.
Key services
Urgent care, heart care, ambulatory surgery, diabetes, endoscopy

Detroit Medical Center

3990 John R. St.
Detroit, MI 48201
(313) 745-1250
Michael Duggan
President and CEO

Detroit Medical Center is a comprehensive, integrated medical system that can handle virtually any health care need. Established as a nonprofit corporation in 1985, DMC is a leading regional health care system with a mission of excellence in clinical care, research and medical education. With more than 1,800 licensed beds, 3,000 physicians and nearly 12,000 employees, DMC is a leader in advanced technology and medical techniques. The Detroit Medical Center operates nine hospitals and institutes, including Children’s Hospital of Michigan, Detroit Receiving Hospital, Harper University Hospital, Huron Valley-Sinai Hospital, Hutzel Women’s Hospital, Kresge Eye Institute, Rehabilitation Institute of Michigan, Sinai-Grace Hospital, and DMC Surgery Hospital.   

Key services
Cancer, cardiac and vascular care, emergency/trauma, neurosciences, ophthalmology, orthopaedics, pediatrics, women’s services and rehabilitation

Henry Ford Health System

1 Ford Place
Detroit, MI 48202
(800) 436-7936
Nancy Schlichting
President and CEO
Henry Ford Health System is a nonprofit health care enterprise governed by community leaders. It reported $3.47 billion in revenue for 2007 while providing more than $132 million in uncompensated medical care. Henry Ford Hospital is a 903-bed tertiary care hospital, education and research complex. It is a multiorgan transplantation center and level-one trauma center.
Key services
Emergency care, diabetes, pain management, heart disease, neuroscience

Oakwood Healthcare Inc.

1 Parkland Blvd., Suite 1000E
Dearborn, MI 48126
(313) 253-6000
Brian Connolly
President and CEO
Oakwood Healthcare System is a comprehensive health care delivery system in southeast Michigan. The Oakwood system serves residents over a 500-square-mile area and operates four acute care hospitals, several health centers and a vast number of specialty services, including centers of excellence in heart, vascular, orthopedics/neurology, women’s health and cancer.
Key services
Heart care, emergency, diabetes, cancer care, endoscopy

St. John’s Health

28000 Dequindre Road
Warren, MI 48092
(888) 440-7325
Patricia Maryland
President and CEO
St. John Health is composed of seven hospitals and more than 125 medical facilities in southeast Michigan. St. John Hospital and Medical Center is a regional-referral teaching hospital affiliated with Wayne State University, with 804 licensed beds, a 1,200-member medical staff, and more than 50 medical and surgical specialties. It is also the largest acute care provider and the only designated Emergency Trauma Center on Detroit’s east side.
Key services
Heart, cancer, obstetrics, neurosciences, orthopedics, behavioral medicine, emergency

Trinity Health Corp.

27870 Cabot Drive
Novi, MI 48377
(248) 489-5004
Joseph Swedish
President and CEO
Trinity Health is the fourth-largest Catholic health system in the United States and has 44,500 full-time equivalent employees and 8,074 active staff physicians.
It operates 44 acute-care hospitals, 379 outpatient facilities, 26 long-term-care facilities, and numerous home health offices and hospice programs based in seven states. Its St. Joseph Mercy Health System serves southeastern Michigan, including Monroe, western Wayne and southwestern Oakland counties.
Key services
Urgent care, vascular care, diabetes, cardiac care, women’s services

University of Michigan

Hospitals and Health Centers

1500 E. Medical Center Drive
Ann Arbor, MI 48109
(734) 936-4000
Douglas L. Strong
University of Michigan Hospitals and Health Centers provide medical care for patients at a variety of hospitals, health centers and outpatient clinics in Michigan. The University of Michigan Medical School is part of the health system. University Hospital is a 550-bed hospital that admits 70 percent of its patients from communities or regional hospitals outside the Ann Arbor area.
Key services
Cancer services, anesthesiology, emergency care, diabetes, pain management
Tuesday, 26 May 2009 20:00

Finding a balance

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You probably wouldn’t envy Mike Riehl’s situation. The president and owner of Mike Riehl’s Roseville Chrysler Jeep even admits that the auto industry isn’t an easy place to be right now.

“If it was, lots of people would have the job that I have,” says Riehl, who also runs neighboring Roseville Powersports and Roseville Collision Center under his name for total 2008 revenue of $73 million. “But if we have the proper balance, then we can survive in these very tough times.”

For Riehl, who has been in the family-run business for 38 of its 42 years, that balance comes from depending on his 85 employees to lighten his load.

Refusing to cower behind bad news, Riehl stays visible and approachable. But he isn’t afraid to admit that he struggles with the stress. He encourages his employees to follow his example for coping, taking breaks and asking for help when they need it.

Smart Business spoke with Riehl about keeping yourself and your employees positive in trying times.

Stay visible. You have to be visible. You have to try to keep positive. … I’m here almost every day. I start at around 7 a.m., and I work through the whole day. I walk all the different departments and shops. I say hi to the employees and visit with them from time to time.

Being here and being visible and working through the day-to-day challenges enforces that I’m here with them and we’re pulling [in the] same direction.

Go to work. Get out of the office. Visit your employees or say, ‘Hello, good morning,’ to them, or, ‘Good evening.’ Or from time to time, ask them how they’re doing, how’s their family, ‘How was your weekend?’ It doesn’t seem too hard.

Try to keep your spirits up. That’s the hard part, trying to stay positive, trying to be educated on the world and the national issues and then trying to stay engaged in Michigan and Detroit metro issues. There’s a lot of negative.

Just think, it could be a lot worse. We’ve had many ups, and we have many downs, and hopefully this too shall pass sooner [rather] than later.

Always be as positive as possible in a group. If you have to reprimand or if you have to be firm with an employee, do it behind closed doors.

Take a break. You have to maintain your health and a proper diet and [limit] your consumption of alcohol. I think those basic things could probably help you in challenging times. If you keep yourself healthy, you’ll be able to handle more grief.

If you’re at a point in the day that you’re stressed out, put a coat on and take a long walk outside. Get some fresh air into your lungs and think about something different for a few minutes, and then go back in refreshed and start over. It works.

I ask [employees] from time to time, ‘If you feel yourself frustrated, if you feel yourself stressed out and you’re on the showroom floor, if you’re in the eyes of a customer, please take a break. Please go take a long walk. Take an early, long lunch to try to refocus yourself.’

Admit your struggles. You can’t stay positive all the time. And if you know you’re very stressed out and you’re very upset, sometimes you have to ask for their forgiveness because you are stressed out and going through a tough time. So just hang in there and apologize before you start. And just say, ‘I have to get this off my chest. It’s important that you people share some of this stress.’

And then once I get it out and it’s off my chest, then we have to work with the group. But the manager has to deliver the message. And sometimes if you say it, it’ll go in one ear and [out] the other. But if you have a lot of emotion, if you’re very upset and they see that, then they know it’s a real issue that people have to figure out how to get behind and solve the problem.

They’ll see that the leader is serious and they’ll see that the leader is upset and stressed out, and then they put the afterburners on to try to take some of the burden off of that one person: ‘How can I help you?’ and, ‘Let me get involved.’

Ask for help. They have to use each other. They have to use me, and I have to use them to get through these day-to-day extreme challenges. That’s why they call it a team.

I think you have to [tell] them how important it is to take care of each other: ‘Use each other’s talents and skills. If a manager’s not available right at that point, ask your buddy — have like a buddy system — to review something, or [ask], “Does this look like it’s doing the right thing?”’ And they help each other out.

You just have to keep instilling it into the group that we’re all into this together, nobody’s better than the other person, we’re all equal.

There are small teams within the large teams. There might be two or three salespeople that kind of work together; they try to help each other out. There are parts people that help out and pick up the phones when they’re ringing, greet customers. They automatically help each other with the phones and meeting and greeting the customers. If one person’s at lunch and a customer comes in, they will [say], ‘Hey, let me start with you, and I know he’ll be back in 15 minutes.’ It’s a team within a team.

How to reach: Mike Riehl’s Roseville Chrysler Jeep, (586) 859-2500 or

Tuesday, 26 May 2009 20:00

Managing risk

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Monitoring and containing risks has always been important for businesses, but in today’s economy, the need to manage risk has become critical. By performing a holistic risk assessment, your organization can identify, analyze and mitigate risks, creating a culture of awareness and enhancing the organization’s value. Conducting a holistic risk assessment is especially important if your company operates in an industry hit hard by the current financial crisis.

“Organizations large and small can benefit from holistic risk assessments,” says Harry Cendrowski, CPA, ABV, CFF, CFE, CVA, CFD, CFFA, and managing director of Cendrowski Corporate Advisors LLC. “While many firms intensely monitor risks at a divisional or product-line level, a firm-level risk assessment can help the company better mitigate risks that may jointly affect differing areas of the organization.”

Smart Business learned more from Cendrowski about holistic risk assessments, why they’re so important and how they can benefit you and your business.

What is risk management?

Risk management is a process that identifies possible risk exposures an organization can face. It allows for the systematic evaluation and prioritization of risks while determining the likelihood of occurrence and the potential consequences if the risk occurs.

On the whole, risk management establishes what assets need to be protected, the value of those assets, the threats and vulnerabilities the company could face, the implications of those threats and vulnerabilities, and what can be done to minimize exposure to those risks.

A good risk management plan will contain appropriate controls and/or countermeasures to quantify each risk, and it should propose applicable and effective security controls for managing risks. The plan should also contain a schedule for control implementation and responsible persons for those actions.

What is involved in a holistic risk assessment strategy?

A holistic risk assessment involves three components: risk identification, analysis and mitigation. Organizational managers are often good at identifying and analyzing risks at the divisional or product-line level. However, in order for the risk management strategy to be effective, these managers need to look not only at the primary effects associated with individual risks but also at the correlation between identified risks across divisions and product lines.

If one of a firm’s product lines experiences a significant shock to its revenue, is it likely that another product line will experience a shock in tandem given the nature of the risk?

For example, if a supplier to a particular product line goes out of business, is it also likely that a supplier to another product line will meet the same fate given the nature of the risk?

By identifying highly correlated, risky events through a holistic risk management process, managers, boards and C-suite executives can move first to address these issues before proceeding to other risks. Without such a strategy in place, the firm could find itself facing significant issues occurring at the same time in separate divisions.

What are some key factors in successfully performing holistic risk assessments?

The act of performing a holistic risk assessment does not necessarily ensure its success in mitigating risks. It is a necessary condition but not a sufficient one. Many organizations actively perform risk assessments. However, the organization’s culture often hampers some part of the risk management assessment.

As an example, if the organization has sloppy data collection procedures, the information used in performing the risk assessment may lead to incorrect conclusions. On the other hand, even if accurate data are employed in a risk assessment, its success is predicated on management’s ability to shepherd the process throughout the organization. Weak management, or management’s indifference toward a risk assessment, can cripple the process.

Are there any types of businesses that are more susceptible to risks than others?

Firms using large degrees of leverage are particularly susceptible to risks because of the debt on their balance sheet. This leverage is often used to drive returns, but it also exposes the firm to significant downside risks. Firms with low debt-to-equity ratios, conversely, will generally be able to better weather an economic storm, all other things being equal.

Venture capital investments, for instance, are primarily equity investments with little to no leverage. While these types of assets experience shocks, there at least exists some downside cushion for venture investors due to the lack of leverage.

To take this point a step further, while the dot-com bubble and its subsequent bust were painful for many in the venture capital arena, it in no way catastrophically affected our financial system as did the current crisis. The current crisis’ shocks were made significantly more crippling due to the leverage employed by investment banks and homebuyers in their purchases.

Harry Cendrowski, CPA, ABV, CFF, CFE, CVA, CFD, CFFA, is managing director of Cendrowski Corporate Advisors LLC. Reach him at (866) 717-1607 or, or visit the company’s Web site at

Saturday, 25 April 2009 20:00

3 Questions

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Izak Duenyas is a professor and the chair of operations management at the Ross School of Business and a professor of industrial and operations engineering at the University of Michigan.

His research interests are in supply chain management, investments in capacity and flexibility, and lean manufacturing. He has been awarded the Researcher of the Year award by the Ross School of Business, and he has provided training and/or consulting services to companies such as GE, Ford, Siemens and Diebold. He is also a co-director of a program in lean manufacturing for industry offered at the University of Michigan.

Q. Why should companies re-evaluate their approach on transportation logistics?

Many companies see transportation logistics as a cost center, and this is just not true. Approach transportation logistics in a problem-solving fashion. Your customers want something — finding the most efficient process to get them what they want will create customer loyalty. If they want the lowest price possible, see how you can eliminate costs in your overall company strategy to get them the lowest cost. If they care most about the fastest delivery, find a way to get them that.

Q. What advice can you provide to companies looking to reassess their in-house shipping process?

Be congruent with your supply chain strategy. Make sure everyone is handling the process in the same manner. Try not to have too narrow of a focus. Don’t minimize cost only. Look at all possible strategies that will ultimately be best for the company. Don’t be ideological about your approach. There’s always a PR benefit and a cost benefit to actions.

Q. How can technology help a company have more efficient transportation logistics?

Technology is a huge benefit if you know the solution you need. Know your problems and goals before investing in technology. Technology can help you organize, ship and plan all aspects of transportation logistics, but if you are enamored with technology and have no strategy, it will be useless to you.

Izak Duenyas is a professor and the chair of operations management at the Ross School of Business and a professor of industrial and operations engineering at the University of Michigan.

His research interests are in supply chain management, investments in capacity and flexibility, and lean manufacturing. He has been awarded the Researcher of the Year award by the Ross School of Business, and he has provided training and/or consulting services to companies such as GE, Ford, Siemens and Diebold. He is also a co-director of a program in lean manufacturing for industry offered at the University of Michigan.

Q. Why should companies re-evaluate their approach on transportation logistics?

Many companies see transportation logistics as a cost center, and this is just not true. Approach transportation logistics in a problem-solving fashion. Your customers want something — finding the most efficient process to get them what they want will create customer loyalty. If they want the lowest price possible, see how you can eliminate costs in your overall company strategy to get them the lowest cost. If they care most about the fastest delivery, find a way to get them that.

Q. What advice can you provide to companies looking to reassess their in-house shipping process?

Be congruent with your supply chain strategy. Make sure everyone is handling the process in the same manner. Try not to have too narrow of a focus. Don’t minimize cost only. Look at all possible strategies that will ultimately be best for the company. Don’t be ideological about your approach. There’s always a PR benefit and a cost benefit to actions.

Q. How can technology help a company have more efficient transportation logistics?

Technology is a huge benefit if you know the solution you need. Know your problems and goals before investing in technology. Technology can help you organize, ship and plan all aspects of transportation logistics, but if you are enamored with technology and have no strategy, it will be useless to you.

Saturday, 25 April 2009 20:00

Behind the scenes help

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All health plans are not alike and offer different services and benefits to consumers. But one common thread is that health care costs are continuing to increase and are expected to exceed $8,000 per person this year. You cannot control future health care costs and improve your employees’ health unless you find a carrier that will work behind the scenes to effectively manage your total medical spending and solve these problems by providing value-added services.

“Knowing more about these services can help an employer sleep better at night, knowing that they are getting great value for their health care dollar and that their employees are being cared for by a team of professionals,” says Amy O’Meara Chambers, associate vice president of market development at Priority Health.

Smart Business spoke with Chambers about behind-the-scenes work that takes place at health plans, how to take advantage of value-added services offered by health plans, questions to ask regarding your health plan, and what elements make up a good health plan.

What goes on behind the scenes with health plans that employers or consumers might not know about?

Health plans have many services in place to keep members healthy. These services help employers maintain a work force that is healthier and more productive. Employers also see their health care expenditures’ bottom line improve.

Health plans also have many health experts on staff who are tasked with bringing the best health care solutions to members. These people research, work on quality initiatives, help coordinate member care and help members manage chronic disease. Health plan experts are also conferring with community doctors, nurses and pharmacists either in committee formats or one-on-ones, discussing individual member cases to determine the best course of action.

What are some value-added services offered by health plans, and how do they work?

Examples include case and condition management, disease management, wellness programs and prevention. These services monitor and utilize data that’s received through medical claims to identify complex member cases and chronic conditions. Health plans also reach out and help members coordinate their care while experiencing intensive treatments and offer educational support to those with chronic conditions.

Other areas of value-added services are wellness programs and first-dollar preventive care. These services encourage members to take an active role in their health care and address health issues early. Members have preventive care built into their coverage and have access to programs such as community wellness classes, fitness discounts at area retailers and interactive tools on the plan’s Web site.

What questions should employers ask their health plan regarding the services in their contract?

Take advantage of your health care dollar by educating yourself on all your health plan has to offer. There could be free wellness programs just waiting to be utilized, but if you don’t ask, you may never know they’re available. Your employees will be thankful for their reduced gym memberships or free classes on something such as ‘quick and healthy meals.’ Healthy employees make for a healthy bottom line.

What kind of reporting can you expect from a health plan to help structure effective programs for employees?

Employers are able to make good decisions when they receive accurate and actionable data reporting. Financial data supplied to large groups help guide them toward the best funding option, whether it’s self-funding, shared funding or fully funding their health plan’s expenses.

Health and wellness information is presented to assist with identification of opportunities for case and disease management as well as wellness programming support. Lastly, plan design data is reported with a focus on utilization by benefit type to identify potential changes to member liability and alignment of benefits with the employer’s benefit strategy. Smaller groups that take advantage of a community or book rating do not typically have access to group specific data reporting; however, data becomes more available as groups reach or exceed 50 employees.

What sets a great health plan apart from a good health plan?

Great health plans provide excellent health care that is affordable. These plans receive high honors when compared with peers and garner respect from the employer and provider communities and the membership at large.

Great health plans offer a range of products that complement your employer benefits strategy. They offer excellent claims systems, the highest caliber customer service and excellent health management programs that show a return on investment, online tools, etc.

AMY O’Meara CHAMBERS is the associate vice president of market development at Priority Health. Reach her at (616) 464-8540 or

Saturday, 25 April 2009 20:00

Return to health

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When Jesse Thomas first mentioned the T word, he knew it would raise some eyebrows.

That’s T as in “turnaround.”

Like a lot of companies in Michigan, Molina Healthcare of Michigan has recently felt the effects of a sagging economy, which had led to concerns among the health insurance company’s leaders over revenue and membership growth.

But when Thomas became president and CEO of the subsidiary of California-based Molina Healthcare Inc. early last year, he wanted to take things a step further.

“Every market has some of its own challenges that are unique,” says Thomas, who arrived in Michigan after a stint with Molina’s Ohio subsidiary. “In this market, I felt we had opportunities for improvement in profitability, membership and revenue growth. To address that, I repositioned the company as a turnaround. Sometimes that is difficult on the psyche of the individuals involved, but nobody disagreed with me that we had missed some of our targets and had the opportunity for improvement.”

Molina’s situation wasn’t as desperate as some turnaround stories. The existence of the company wasn’t at stake. But the long-term financial health of the company was potentially poised for a steady decline without Thomas’ intervention.

As with many turnarounds, Thomas had to identify the problem areas and ways the problems could be addressed, organize a go-forward plan with his leadership team, and then achieve buy-in from as many people in the organization as possible.

It’s a multistep process that took vision and big-picture thinking from many people. But it also took a great deal of persistent communication from Thomas as he rallied 250 associates around the common cause of improving Molina’s outlook in Michigan.

Build the bandwagon

Thomas saw three areas of concern on which Molina needed to focus its resources: improving profitability, improving membership numbers and improving the overall quality of the services Molina offered to its Michigan plan members.

But in order to move forward, he needed to make sure his leadership team was on the same page with him.

“I needed to see if our associates and leadership team were drawing the same conclusions that I was,” Thomas says. “So, at the outset, it required me spending a significant amount of time with the team, getting the team in agreement that these are the priorities.”

Thomas does meet periodically with all of Molina’s associates in Michigan, but on a more frequent basis, he and his management team rely on cascading communication. During the early stages of the turnaround plan, it was cascading communication that helped get everyone focused on the tasks at hand. Thomas’ communication strategy started with high accountability at the top levels of the company.

From the outset, Thomas wanted to ensure that his leadership team was meeting and reviewing the strategy and that the strategy was communicated throughout the company at frequent intervals.

“As the president and CEO of the Michigan plan, I have leadership that includes a C-level chief medical officer, my chief operating officer and chief financial officer, and other directors and officers who report to me,” Thomas says. “We can’t just get together willy-nilly. We needed to have a standing agreement to return and report to each other regularly, to get together, measure and gauge the progress we’re making on the important priorities of the company.

“Each of my direct reports, in turn, meets with and counsels with their direct reports. So it starts with the leadership team, cascades down to the next level and down through the levels of the company so that every associate in the company is aware of our priorities. We also post them in the building and put them on our computer desktops so that everyone can see the progress we’re making with regard to those priorities.”

Thomas says good communication starts at the top. If you want to focus your employees on a set of goals, you must communicate actively, not passively. Just because the message is out there doesn’t mean people are absorbing it.

“The effectiveness of communication is in the outcome you get,” he says. “Simply put, the burden for effective communication is on the communicator, rather than the person hearing the message. If you can’t tell it, you can’t sell it.

“I follow a principle I call GABE, which is an acronym. G is ‘Get in front of the issue.’ A is ‘It’s always about the money.’ B is ‘Be proactive.’ E is ‘Early and often.’ I believe that I have to keep in mind that the greater burden is on me to communicate and that I need to make sure I’ve communicated effectively to get the outcome I want. I can’t assume someone is going to hear what I want them to hear. So I have to test and retest what I said, asking people what they heard me say, what is the outcome, what are they taking away from my communication.”

In refocusing Molina, Thomas found that what employees take away from your messages can have a lot to do with the words and descriptions you use. Thomas divides people into three general categories: those who learn by sight, those who learn by hearing and those who learn by feel. The stage you set in your communication plays a large role in how you reach each of those groups.

“You develop, over time, techniques for identifying in your associates what their primary system is for absorbing information,” Thomas says. “I use the predicates and metaphors appropriate for that learning style. For someone who is a visual learner, concepts need to be graphically illustrated more often. I’ll ask them if they can imagine or picture an idea or concept. Someone who is an auditory learner, I’ll ask them to drive a point home or nail it down. If someone learns by feel, I want to make sure I’m using predicates and metaphors related to feeling. ‘How do you feel about this; do you get a sense that it would be better if we approached it this way?’

“You have to learn the primary system for how each of your associates processes information.”

When you are in a large group setting, cover all your communication bases.

“You can’t just assume that you have one-third, one-third and one-third of each type of learner within that group,” Thomas says. “You have to mix up the predicates and metaphors in a way that you are making sure that there is a greater chance of hitting all three types of learners within the audience. I’m approaching things in two or three different ways in every forum, meeting or conference in which I am communicating.”

Measure the progress

Molina of Michigan has what Thomas terms a “scorecard culture.” In order to measure the progress of improvement in the areas of profitability, membership and quality, Thomas and his leadership team keep track of the metrics linked to those areas, graphing them and looking for trends.

“It’s very much like football, basketball or baseball,” Thomas says. “You know the progress you’re making because you’re keeping track of the score. You’re keeping track of the boundaries and all the things you need to be doing to advance the ball. We make sure that we scorecard not only all of the activities we perform but also the results, the things we want to get accomplished.

“We put together graphs that regularly show the improvement that we have in one metric over another. We are constantly proving to ourselves that we are making the progress we need to make, that we are watching a trend ... moving in the direction we want it to move. You’re looking for trend lines moving in the right direction, and you are regularly communicating and giving feedback to all who touch that priority to make sure you are accomplishing what you want to accomplish.”

Measuring metrics is one of the ways in which Thomas has gained input on the progress of Molina. The statistics and analysis reported by his management team have helped him refine the direction of the company.

It plays into Thomas’ overall philosophy that good leaders are good followers who take as many viewpoints as possible into consideration before making a decision — as long as a decision is ultimately made.

“As a leader, you have to be very respectful of the guidance you receive,” he says. “You have to be collaborative to a certain extent, without being democratic. Democratic is where you wait until you have total consensus or majority rule. But sometimes you won’t get that majority rule, and you have insights as the president of the company that others don’t have.

“I try to take into consideration the views and perspectives of others, but the buck ultimately stops with the person in charge, the person who has accountability. I know where my go and no-go decision points are. I know what my deadlines are for achieving consensus and whether I have it or not [and I know when] I need to move on.

“If you’re staying relevant to policy, the budget and the guidance of the company charter, having a majority consensus is less relevant than staying true to those things. That’s why a good leader has to be a good follower.”

Keep the momentum going

More than a year into his tenure, Thomas’ plan to refocus Molina Healthcare of Michigan has had positive effects. Though the plan’s final 2008 membership was down slightly to 206,000 from 207,000 in 2007, revenue has inched upward, with a final 2008 total of $509 million, up from $487 million in 2007.

The company remains focused on improving the three key areas that Thomas outlined during his first weeks and months as president and CEO, and the company’s leaders remain focused on maintaining a culture of communication that starts at the top.

“When you sit down to review the strategy and where you want to go the following year, you don’t do that in a vacuum,” Thomas says. “The leaders of our company don’t sit in a suite or in an ivory tower and issue declarations. We have a chance to invite the input from most of the leadership team and management team very early in the process.

“We have standing meetings where we bring together our management team, our key leadership team and even all 250 associates within the company. We spend time together, reporting the progress month by month and quarter by quarter. We do that because people need to see the progress being made against the priorities, that we are a company with a purpose.

“It’s about building and maintaining a culture of mentoring, coaching and constant feedback, and my door is always open to the extent that I am able to leave it open.”

How to reach: Molina Healthcare of Michigan, (248) 925-1700 or

Thursday, 26 March 2009 20:00

Going green at the bank

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More businesses are recognizing the ecological and economical benefits of adopting green practices, whether that means instituting an office recycling program or integrating sustainability practices into the company’s strategic plan. Going green is not a fad; it’s here to stay.

“Even small steps a company makes to reduce its footprint can pay off, starting with reducing wasteful paper trails in every part of the business,” says Craig Johnson, president and CEO, Franklin Bank, Southfield, Mich. “Many businesses are making an effort to go paperless, and bank transactions are an easy first step toward that goal if your bank offers the right tools.”

Consider your company’s banking transactions. Beyond online banking and bill pay, there are technologies available to decrease paper flow, reduce your carbon footprint, save time and avert additional fees if your financial institution charges a premium for hard-copy statements.

Smart Business spoke with Johnson to discuss ways that banks are making it easier for businesses to operate in a leaner, greener way.

Aside from online banking, what other paperless banking technology is available?

Electing to receive statements online saves a monthly mailing and creates an electronic footprint, which is a good thing. You can easily access information online, saving trips (and, therefore, gas) to the branch. Beyond that, companies can process checks at their place of business through remote capture. This technology requires obtaining a check machine, which is used to digitally file checks. The machine converts paper checks into electronic files, which are transmitted to the bank. Funds are available immediately, and canceled checks are readily accessible online. The ease of service alone is reason to incorporate remote capture into your business practices. The efficiency created on the business and banking sides of every check transaction is significant. Remote capture is the wave of the future in banking — it’s ‘green’ and incredibly convenient for business owners.

What is the payoff for adopting paperless banking practices?

Rather than counting dollars and cents, consider other important factors that indirectly affect your company’s bottom line and are just as important: productivity, efficiency and accessibility. How can going paperless improve these areas of your business, and what will that save your business? For example, remote capture saves a trip to the bank (carbon emissions and time) and makes checks more accessible by storing them online.

As more financial institutions adopt internal paperless strategies, they will encourage customers to embrace electronic banking. Banks may begin charging fees for getting paper statements or opting for the paper version of a service that is offered digitally. Already, most banks truncate cashed checks and store images on film rather than mailing the canceled paper checks back to your place of business. We can assume that as consumer demand for ‘green’ infuses the business world and flows into the mainstream, service providers across all industries will continue efforts to be more sustainable.

What are bank branches doing to become more green?

As businesses begin to embrace a more sustainable culture, they may elect to do business with vendors that are equally committed to the cause. If this describes your business, you should talk to your bank about technologies in place that show an effort toward being a good corporate citizen. One example in the banking world is branch capture, which is essentially remote check capture at a bank level. Rather than banks couriering checks to a processing center, where personnel run checks through energy-intensive machines, branch staff ‘copies’ checks digitally, using a check machine. Those images are stored electronically and transmitted to the processing center. Branch capture benefits both the bank and business customer. First, the customer gets immediate credit for the deposited check. Second, the paper trail ends at the branch, saving time and energy.

For businesses concerned about whether moving to completely electronic banking is safe, can you address the security issue?

There is actually more control and security with online banking because electronic statements are password protected. Identity theft can occur through snail-mail if banking statements and bills are intercepted. Meanwhile, by managing accounts online, you likely monitor them on a daily basis and will immediately detect fraud, should it occur. Most consumers and businesses are comfortable logging in to online accounts by now to reconcile accounts. Receiving statements and depositing checks this way is just as safe. Paper is essentially one more step in the financial transaction that can get lost, intercepted, misplaced and abused. Talk to your banker about online security and find out what systems are in place to assure that transactions are private.

CRAIG JOHNSON is president and CEO of Franklin Bank, Southfield, Mich. Reach him at or (248) 358-6459.

Thursday, 26 March 2009 20:00

Time for a change

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Richard J. Shaieb could plainly see that his company was stuck. No matter what he tried, Whitlam Label Co. Inc. couldn’t get past the $20 million range in revenue. However, Shaieb says he may have found the solution.

“What I’ve realized is that the people that are in charge, some are in the wrong position, some are just taking on too much, which is holding us back, and the culture needed to be changed,” says the president and CEO of the label provider, which posted 2007 revenue of more than $20 million.

Smart Business spoke with Shaieb about how to improve your company’s culture by getting the right people in the right places.

Q. How do you change a company’s culture?

Identify who should be there and who shouldn’t be. We’ve had a lot of people that, whether they are friends or longtime employees, they were very good at what they did in one position. We put them in other positions where they have failed.

(It’s) relearning what we needed to do as managers or the owners with certain disciplines that we tend to relax with, and that’s what creates a culture — the lack of discipline or accountability, allowing the excuses because it was a very family-orientated operation. We went from six employees to 120, and it went so quickly that we didn’t put the right disciplines in place, which we are now. That was what I recognized — too many chiefs, nobody was running the show and everybody was doing their own thing. There wasn’t really one directive, and that needed to be changed.

Q. What advice would you have for a leader who wants to change a culture?

Most people understand what needs to be done. They have a hard time moving forward because some of the realities they don’t want to really face as a CEO or president and you’re surrounded by maybe co-workers that have been with you a long time.

You just have to take a few steps back. Just be honest and ask yourself, ‘What is holding me back? Why can’t I move forward?’ Once you start identifying certain areas, you will see that, sometimes, it’s the people that you have in place that seem to be holding you back.

Then again, it could be just that you are not doing the things that you should be doing like delegating and not trying to do everything yourself or being too involved and not allowing people to do their jobs. Everything is your way. That’s not my way, but there are people here that are like that. You just can’t get them to let go, and then that’s why nobody comes to the top and performs because of some of those leaders in some different areas. That just keeps those people from growing.

You have to identify those who have the ability to be taught to let go and those who have no clue on how to do it in the first place.

Q. How do you identify who can be trusted and who has talent?

What I’m really focused on is who has the fire in the belly. They have to have that in the first place. They have to be excited about what they do. That’s really key in the beginning.

We have these vice president meetings every Tuesday, and you can see who is energized and who really, deeply wants things to happen. Those are the people that tend to do better and can be taught.

It’s the ones that … aren’t very aggressive, just don’t possess any energy — those are the ones that are going to take a little more to push. They may be able to do it, but you are going to find yourself constantly driving them. You need people that are more self-driven. That’s a key factor.

They can have all the knowledge they want, but if they can’t seem to drive people or drive and get things done, it doesn’t matter.

Q. How do you drive someone to be better?

It’s a little touchy because you’ve got to try to understand why aren’t they driven. Why are they not excited? Is it something that they’ve experienced in the past?

You really need to take the time with the employee and try to understand what they are about and what they are feeling and what they are understanding. Maybe it’s not a good fit for them, and maybe that’s a conversation that you have with them — an honest conversation. There may be another area that they’d be better suited for or maybe they don’t belong here in the first place.

You are doing an injustice if you just keep trying to get something out of somebody who doesn’t want to be there in the first place.

How to reach: Whitlam Label Co. Inc., (800) 755-2235 or