There are plenty of warnings about wanting too much in this world, whether it is in your personal life or as the CEO of a company.
Remember the dot-com bust? Prior to the technology market bubble bursting, tech companies could do no wrong. Investors were ignoring basic fundamentals because “this was a new era” and the old rules didn’t apply. Well, it turns out the rules did apply. As did one very old rule about “what goes up, must come down.”
Tech company valuations were slashed by billions, thousands were laid off and the ripple effect was felt throughout the economy.
More recently, we experienced the real estate bust. It was pretty much the same story — people ignored basic investing and common-sense rules and the prices for real estate went sky-high, and then the bubble burst. The results were also the same: billions in value lost, thousands of jobs affected and the ripple effect was felt throughout the economy.
There is plenty of blame to go around for these events, both by investors who got caught up on the hype and CEOs who were trying to get rich, or at least richer than they already were. It was a quest to have the biggest paycheck, the biggest yacht, the biggest plane and the biggest house. The reckless CEOs were trying to use get-rich-quick methods that are dangerous to everyone.
There are four common ways to grow a company:
- Going public through an IPO
- Mergers and acquisitions
- Debt financing
- Self-funded organic growth
IPOs cost a lot of money to launch and even more money to maintain. The second and third methods are all about leverage. Overvalued stocks and overleveraged companies were major contributors to the tech and real estate busts. Too many CEOs were borrowing more and more money to fund the next great merger or open more locations. When tough times hit and the money dried up, they had lived well beyond their means and a harsh reality set in.
Despite these recent economic failures, many companies are still playing with borrowed money, overleveraging themselves and putting their entire company at risk. You have to understand the leverage game and the risks that come with it. The best way to grow a company is to create an environment that fosters growth and to focus on building long-term relationships.
This isn’t to say that you won’t make a strategic acquisition here and there or occasionally borrow money to fund needed expansions. The key is to do it in moderation and understand how too much debt can hurt your ability to grow. Making a mistake with debt can spell doom for your company and everyone in it.
Your responsibility as CEO goes far beyond yourself. Investors obviously are counting on you, but so is everyone that works in your organization. For some of your vendors, you might be their largest account. If you suddenly went out of business, how would it affect them? Would you create your own mini “bust” that rippled through the local economy, even on a micro scale?
In today’s world, you need to take a hard look at how you are leading your company. One wrong move could cut you off from the credit you need to fund your leveraged growth. With no money, the organization often collapses under the weight of its own debt.
It’s OK to be satisfied with what you have and not play the high-risk game of leveraged growth. Growth is good but not when it requires an “all-in” risk that can ruin your organization and the lives of the people who work there. Remember, more often than not, slow and steady wins the race.
Fred Koury is president and CEO of Smart Business Network Inc. Reach him with your comments at (800) 988-4726 or email@example.com.
Many companies trace their success to innovation. Whirlpool invested millions of dollars to embed creativity into their business culture and build new offerings. FedEx pioneered computer usage in delivery vehicles, designed sophisticated automation for corporate shipping, and developed package tracking. Southwest Airlines is known for its 25-minute turnaround — developed after benchmarking NASCAR pit crews — and Wal-Mart is renowned for supply chain management practices.
Creativity spawns innovation, creates value, and enhances market performance. When IBM interviewed more than 1,500 global executives in more than 30 industries for its 2010 study, “Capitalizing on Complexity,” they found that creativity is now the most important leadership quality. My recent study of 70 technology firms explored marketing practices. While the companies were successful in innovation — the success rates were 82 percent for product technology, 70 percent for management know-how, 66 percent for innovative culture, and 60 percent for R&D expertise — process technology, ideas embodied in the manufacturing and operations, was the one weak link. It was practiced successfully by only 49 percent of the companies surveyed.
Generally, creativity plummets as people age. We learn what is correct and “accepted” and become obsessed with failure. With groupthink mentality and play-it-safe business cultures dominating, is it really surprising that great ideas are limited? Incredible success stories like Apple, Amazon, and Google are rare exceptions, not the rule.
So, how can companies successfully innovate? A five-step process can be insightful:
Identify the problem or business challenge
For example, ask “How might we improve product X or customer satisfaction?”
Offer many possible ideas or use “what if?” statements as steppingstones to new ideas. Think way outside of the box, but remember that you often have to implement within the box.
Find a tentative solution
Develop decision criteria and select the best option. Consider cost savings or efficiency (doing things right), effectiveness (doing the right thing) and flexibility (how else can we solve customers’ needs?)
Try out the proposed solution on real customers and get feedback for possible improvements.
Go to market and adjust
Roll it out, make necessary changes and profit from it. Creativity is a core business activity within an organization that leads directly to entrepreneurship. One of 3M’s seven pillars of innovation success is to have a broad base of technology. This multidimensional thinking is responsible for the development of many unrelated products, such as durable abrasives, highway signs and golf gloves.
Innovation management can be studied as a process improvement technique across a spectrum of activities, from R&D to design, new product management and cycle time reduction. So if you are unsure of how to make innovation a bigger part of your business, here are four tips to help you:
1. Commit to innovate. Whether your organization is a global giant or a small or medium-sized enterprise, establishing a creative climate is the necessary starting point to generate ideas that become profitable business opportunities. Encourage risk-taking, tolerate failure, reward success, and promote open and collaborative business relationships.
2. Get the customer actively involved in the innovation process through co-creation of value or customer toolkits such as web-based tools.
3. Always be innovating. Service firms are often stretched to capacity servicing existing clients or manufacturers may be pressured, putting out daily fires. Organizations may have little time for innovation. Yet, crises make innovation even more important. For example, the Tylenol poisonings led to the introduction of tamper-proof medicine bottles which resulted in increased customer confidence in Johnson & Johnson.
4. Plan for innovation. Break out of the routine through creativity retreats to re-energize and motivate your people. Consider quarterly brainstorming sessions, occasional dinner meetings or a weekend out-of-the-office experience (get done by noon on Saturday). Also, supplement face-to-face briefings with technology initiatives to stay on track. Be open to change!
Art Weinstein, Ph.D., is a professor of marketing at Nova Southeastern University and author of “Superior Customer Value — Strategies for Winning and Retaining Customers.” Visit his website www.artweinstein.com or reach him at firstname.lastname@example.org or (954) 262-5097.
FINALIST - Technology
co-founder and CEO
After top executives at several companies told Will Fleming and his co-founder, Adam Rubenstein, that they saw a need in the future for having multilingual websites, they created MotionPoint Corp.
While there was a demand for multilingual websites, companies did not want the costly IT investment necessary to maintain mirror sites.
So Fleming went to work on ?nding a better solution. Initially when MotionPoint, a translation and globalization services company, was founded in 2000, its focus was to help online retailers provide more complete, accurate and timely product information to shoppers.
One of the most popular features of MotionPoint’s “virtual product brochures” was consumers’ ability to view product information in different languages.
MotionPoint soon learned that while retailers had a limited need for its virtual brochures, nearly every company with a diverse customer base was interested in making its website multilingual.
As co-founder and CEO of MotionPoint, Fleming listened to what people were asking for.
The company developed a suite of patent-protected technologies that make it quick and easy to add any language to any website — without any client IT development.
Companies can provide MotionPoint with the main language site and its software translates the website into multiple languages.
MotionPoint’s systems are capable of performing the same change to the translated sites without someone having to maintain a mirror site and sift through coding to isolate the change, resulting in a more cost-ef?cient option.
This approach continues to be a game-changer, eliminating the cost and complexity traditionally required by website translation.
MotionPoint’s ?rst multilingual website client debuted in Spanish in 2003. Fifteen more sites followed in 2004.
By 2007, MotionPoint was launching more than 100 websites every year. Today, MotionPoint services hundreds of clients, serving billions of multilingual Web pages each year.
HOW TO REACH: MotionPoint Corp., www.motionpoint.com
FINALIST - TECHNOLOGY
founder, president, CEO and CFO
Carol Craig has never let anything stand in the way of achieving her goals and leads by example.
After graduating from college and despite a fear of ?ying, Craig joined the U.S. Navy. She ?ew the P-3 Orion aircraft, which utilized the cockpit software she developed while working for the Department of Defense.
After leaving the Navy, she returned to software engineering and began working from her home as a consultant for government and commercial clients. She started Craig Technologies in her kitchen and began to grow the technical consulting business into a full-scale operation.
When Craig talks about the business and reasons behind its growth and success, she consistently refers to two key terms: situational awareness and unconventionality.
Situational awareness is a term pilots use to describe their state of mind while ?ying in which they are constantly processing data and anticipating changes in their surroundings.
Craig has instilled this belief in her employees, motivating them to seek out and look for information others may have missed and anticipate changes in the environment in order to place the company in a better position than the competition.
Craig also describes herself as an unconventional CEO.
When she started out, Craig was told she needed to develop a niche in the marketplace in terms of the product she was going to supply to the government or a speci?c service she would provide.
However, Craig did not want to put the company within a niche market. Instead, she insisted her company become diverse in many different areas of government contracting, and this broad range of services is what has allowed the company to thrive.
Craig Technologies supports many organizations in Brevard County, and Craig devotes countless hours in leadership positions with more than 20 organizations and makes generous ?nancial contributions.
HOW TO REACH: Craig Technologies, www.craigtechinc.com
AWARD RECIPIENT - TECHNOLOGY
founder and CEO
As the founder and CEO of 3Cinteractive, John Duffy looks for new technologies that create shifts in behavior, on the side of businesses as well as consumers. With 25 years of experience in communications and payment processing, he’s channeled this core entrepreneurial philosophy to grow 3Ci.
By creating a business plan that capitalized on the opportunity for growth and innovation in mobile communications, Duffy launched the company in 2005.
Initially he focused on enterprise-level clients, which used small mobile apps, ringtones and wallpapers.
However, under his leadership 3Ci has grown from a self-funded start-up into one of the nation’s fastestgrowing private businesses and the leading provider of enterprise mobile payment solutions for Fortune 1000 companies.
Today, Duffy’s primary focus at 3Ci is providing a strategic direction to guide the company’s future success in the fast-changing mobile industry.
The biggest obstacle the company has faced has been getting its mobile programs live on the many different wireless carriers available in the U.S. — especially because all have unique subscriber policies and standards.
To overcome this, Duffy has dedicated signi?cant people and resources to developing relationships with the various carriers.
This strategy has helped the company build a foundation to interface with a vast number of mobile carrier networks, including all four major mobile carriers that operate in the U.S.
Making 3Ci an expert in carrier processes and infrastructure has allowed the company to turn a barrier to entry into a competitive advantage for the business.
Since founding the company Duffy has always stayed committed to his people, living the philosophy, “Be loyal to people, not companies.”
As a result, the company has only lost one employee since its inception.
HOW TO REACH: 3Cinteractive, www.3cinteractive.com
FINALIST - SERVICES
Steven A. MacDonald
chairman and CEO
In the paper-?lled industry of worker’s compensation, technology is a slow adaptation.
Steven A. MacDonald looked to enhance the customer experience through technology and was a pioneer for his time after co-founding a business to meet those needs. However, after working to build up his company, he was ?red.
To many, this would be an all-time low in someone’s career, but for MacDonald, it was inspiration to start myMatrixx.
MacDonald, who serves as chairman and CEO, built myMatrixx, a pharmacy bene?t management company, on the innovative concept that pharmacy bene?ts in the workers’ compensation space should be automated and accessible online to clients.
This idea revolutionized the industry and provided something none of the major players in the market had — a technology solution designed to turn the industry into a paperless one.
It offered complete transparency. Now clients could use the Web portal to see exactly how their pharmacy claims were being processed and they had the control to approve or deny claims in real-time.
Knowing how complex the industry is and how each client could have different protocols down to a speci?c injured worker, myMatrixx made its system completely customizable.
By providing online access for its clients, myMatrixx has streamlined workloads and greatly reduced the time adjusters spend managing claims on a daily basis.
Clients also greatly reduce their costs by experiencing greater network compliance and higher utilization of generic medications.
MacDonald’s ultimate goal has become a reality — turning pharmacy bene?t management into a paperless industry. Today, myMatrixx has two primary offerings, the pharmacy program and an ancillary and medical equipment program.
The company has become a recognized leader in the workers’ compensation pharmacy industry and has hopes of doing the same with the newer ancillary side of the business.
HOW TO REACH: myMatrixx, www.mymatrixx.com
FINALIST – Services
co-founder and CEO
David Clarke co-founded BGT Partners by envisioning the massive potential that the Internet had for interactive work.
As the company’s co- founder and CEO, Clarke’s pursuit of this vision has been critical in establishing the business as a leading global digital agency, whose clients include Fortune 1,000 companies and has 150 people as its employees nationwide today.
At BGT, Clarke wants his employees to “trade their job in for a career.” A committed entrepreneur, Clarke is fanatical about the retention and acquisition of talented people.
Through the near-impossible obstacles he’s faced in growing the business, including great ?nancial strain in the company’s initial years, Clarke has held himself and his team up to uncompromising standards of excellence.
But he also credits much of the company’s success to the “employee-centric” mentality he and his leadership have taken to cultivate in BGT’s team.
To make BGT a best place to work, Clarke has implemented numerous initiatives designed to create a fun, engaging and challenging employee culture.
For example, the company offers a unique training and education program called the BGT Plus Program, which provides cross-training, professional development and coaching for its employees.
BGT also has developed a Twitter page that allows team members to give their anonymous feedback, ensuring every employee has a voice in the direction of the business.
Other perks for employees include catered lunch every Friday, beer cart Fridays, BGT Palooza — a week of employee appreciation — and more. By investing in a happy culture, Clarke invests in the happy clients that continue to drive BGT’s growth.
In 2011, the company celebrated its 15th anniversary by moving its national headquarters into a custom-built, 30,000-square-foot building that will accommodate its growing staff.
HOW TO REACH: BGT Partners, www.bgtpartners.com
AWARD RECIPIENT – Services
Harvey L. Massey
chairman and CEO
Massey Services Inc.
After more than two successful decades in the pest control industry — including serving as the youngest vice president in the history of industry leader Orkin — Harvey L. Massey decided to take on a new challenge.
He leveraged everything he had to buy Walker Chemical and Extermination, cutting his salary in half in the hopes of turning the company around and growing it into something greater.
As chairman and CEO of the Orlando-based pest control company — now called Massey Services Inc. — he’s achieved that, fostering 27 years of consecutive growth.
Massey accomplished this by implementing immediate change upon purchasing the business. He set up budgeting criteria, created operations standards and established price increases.
Every trimester he budgets and con?gures the company from the bottom up. With the acquisition of another company in 2009, Middleton Pest Control, Massey Services has expanded beyond its original staff of 100 employees and four service centers to a staff of 1,300 employees and 350,000 customers.
Massey has seen his role within the company evolve into that of “coach.” He makes it a priority to listen to his associates and provide ideas, supporting his team and encouraging them to build long-term trusting relationships.
Toward this end, Massey Services employees routinely give out their cell phone numbers to clients with an invitation to call any time.
Other hallmarks of excellent customer service include a 24-hour response time, environmentally responsible pest control methods and detailed explanations of customized service plans, all conducted by expert technicians.
And Massey Services doesn’t keep its best practices within the company — Massey and senior leadership are frequent contributors to the National Pest Management Association as seminar leaders and panel members for industry conferences and summits.
HOW TO REACH: Massey Services Inc., www.masseyservices.com
FINALIST – Retail and Consumer Products
Jesse Stein has always been a self-made entrepreneur.
At age 6, he carried around a briefcase just like his businessman grandfather. At 10, he’d collect tips from serving drinks to party guests. And by 15, he mowed lawns, sold luggage and cold-called for the Dean Witter brokerage agency.
As an adult, his hunger for challenge and intuition for business prompted him to take on the Internet. He founded and sold several Internet-based ventures, which eventually led him to his current position — founder and nonexecutive chairman of SportsMemorabilia.com.
The website sells authentic sports memorabilia, autographs and signed gifts from MLB, NFL, NBA and NHL players.
Stein bought and developed the company from scratch, competing against multiple established competitors. Today, SportsMemorabilia.com is the largest retailer of authentic sports memorabilia, according to multiple sources.
The site features more than 400,000 products across 13 sports leagues. Stein views his ventures as a means to pursue his passion — giving back to the community.
He admires the Bill and Melinda Gates Foundation and the Clinton Global Initiative, and he strives to make an impact on the world in whatever ways he can.
He purchased a food truck and often gathers employees to pass out food in impoverished areas around Miami, aiming to instill and encourage a socially responsible mindset in his associates.
Prior to his work in Internet ventures, Stein worked and lived in Tokyo for six years.
He holds an MBA from The Wharton School, an M.A. in International Studies from the University of Pennsylvania’s Lauder Institute, and a B.A., with honors, in sociology and Asian studies from the University of California at Santa Barbara.
HOW TO REACH: SportsMemorabilia.com, www.SportsMemorabilia.com
FINALIST – Retail and Consumer Products
president and CEO
Sun State International Trucks LLC
Oscar Horton’s strong work ethic led to his rapid ascension within International Truck and Engine. Wanting to more directly impact people’s lives, however, he resigned from his comfortable executive position to set out on his own and take on a challenge.
Horton bought the Tampa and Sarasota dealerships now known as Sun State International Trucks LLC, from International 11 years ago.
When he acquired the dealerships, Horton, the president and CEO, was faced with recurring losses, poor employee morale and a lack of technological infrastructure.
To turn the company around, he took on an aggressive growth strategy in the following years — bringing the current number of locations owned to ?ve — and prioritized investment in his team of employees.
The full-service truck dealership ensures employees understand the business by offering ?nancial literacy courses to educate on items such as the income statement, balance sheet, statement of cash ?ows, and operations and planning.
Quarterly meetings keep all employees informed on operating results and gives associates at all levels the chance to give input.
This successful turnaround has made Sarasotabased Sun State International Trucks an ef?cient, pro?table and quality-driven dealership delivering great customer service, but Horton isn’t resting on his laurels.
He plans to continue a focus on developing his staff, deepening existing customer relationships and investing in technology.
In addition to a commitment to his associates, Horton is dedicated to his community.
He serves on several boards including Academy Prep Center, the University of South Florida, Boys and Girls Club of Tampa Bay, Goodwill Industries-Suncoast, the Bank of Tampa, Federal Reserve of Atlanta, and Navistar Diversity and Inclusion Board.
HOW TO REACH: Sun State International Trucks LLC, www.sunstateintl.com