Jim Kudis and a partner started Allegheny Petroleum Products Co. for the same reason many people start a business — they loved what they did and saw a niche that their company could exploit.

While the company, a manufacturer of industrial lubricants and additives, was seeing annual growth of 20 percent in its early years, Kudis and his partner struggled with money and didn’t take a salary for the first year or two.

“Most small businesses are generally undercapitalized, which we were,” says Kudis, president. “We lived off whatever money we had, which definitely helped because it cut back on the expenses and some of the money going out the door.”

Starting a business is 24 hours a day, seven days a week. You have to live it and love it. You have to roll up your sleeves and do anything you have to do to run that business.

“If you don’t want it that bad, don’t do it,” Kudis says.

The company’s focus in the beginning was providing industrial lubricants to the various manufacturers in the Pittsburgh area. Back then the major oil companies were retreating from the marketplace, becoming very big and going through distributors. Most of the distributors didn’t have the technical know-how of what the lubricants do and how they work.

So Kudis saw a void in what the major companies used to be strong at and what the distributors couldn’t do and that ended up being the niche that Allegheny Petroleum jumped into.

“That was the big advantage to going into the manufacturing part of the business,” Kudis says.

Last August, Kudis and Allegheny Petroleum Products Co. celebrated 25 years in business. In December 2012, Kudis bought out his partner to become the sole owner of the 85-employee company, which saw 2012 revenue north of $110 million.

Here’s how Kudis has grown Allegheny Petroleum Products Co. from a start-up into a successful organization.

Bring in the right talent

While Kudis and Allegheny Petroleum struggled with capital early on, the turning point for the company came around its fifth or sixth year in business.

“We were supplying one of the plants in Cleveland and we made a proposal to do what was a new concept at the time, fluid management,” Kudis says. “We had to put in 125 bulk tanks, which are carbon steel, 500-gallon tanks that ran about $1,500 each.

“So we had to make a more than $200,000 investment to put these tanks in and put in consigned inventory, which ran us another couple of hundred thousand dollars. So we were about $400,000 into this.”

A year later the global buyer for that company called Kudis and told him what a great job Allegheny Petroleum was doing managing their Cleveland plant. He offered Kudis the contract to manage the company’s remaining 70 plants.

“So off it went and today they are my largest customer,” he says.

From that point on, the business has had to function much differently and required new skill sets to keep the company growing.

“My biggest focus today is making sure my managers have all the tools and things they need to do their job, whereas 20 years ago I was doing it myself,” he says. “Now it’s managing people, keeping them excited, making sure they have ownership in the things that they’re doing, and have the tools to do the job that they need.”

Allegheny Petroleum has five fairly distinct areas and Kudis is in touch with each one of the people that manage those areas.

“I’m not trying to do their job, but I’m trying to help them so they can do their job and that’s the key thing,” he says. “It’s all about people.”

To find the right leaders for his business, Kudis chased those executives down and drafted them all.

“I handpicked them and coerced them into coming to work for the company,” he says. “I chose them because I saw the qualities they had. I saw a real desire in each one of them to do well, and that’s where my attention started.

“What I saw in my interaction with them was that they could handle themselves well and present themselves well in front of people. They were knowledgeable and wanted to be more knowledgeable.”

The first thing Kudis looked for in the people he brought in was whether they were good quality people and good solid citizens.

“That’s probably the common thread through most of the people who work here,” Kudis says. “Talent would be second after that — they can manage people and enjoy the ownership of their part of the business. They embrace it and treat what they’re doing like their own.

“It’s just looking in someone’s eye and seeing that they have a desire to do well, not only for themselves, but for the company too. A lot of people want to punch in, get a paycheck, punch out and go home, and that’s not the kind of people I want managing.”

Kudis gives his team the autonomy to do things on their own, which means they have the power to make decisions.

“I give them a free hand to do what makes sense,” he says. “My motto is to make the decision on your own and if you don’t think it’s your decision, then come to me. As long as you have an explanation about why you made that decision, you’re never wrong. You’ve got to be in the game and engage and make decisions.”

Decide how to grow your business

Making decisions is a very important aspect of running a business, especially when it regards growing your company to the next level. Kudis has had to make countless decisions over 25 years and each one helps the company continue its growth. Now those decisions rest on the shoulders of his managers.

“That’s what I expect from the people in a management role,” Kudis says. “In the dealings they have, there comes a point where maybe it’s beyond where they should make a decision on something. In involving putting part of the company at risk or something of that nature, every one of them knows where that line is, where that decision should not be theirs.

“All the other decisions whether they are small, large or whatever, I expect them to make it. It’s really easy to say three or four days later that you made a wrong decision, but to be in the game and make the decision right there, to me that’s important as long as they have an answer why they made a certain decision.”

Every month or every other month Allegheny Petroleum has what it calls a What’s Up Meeting to check in on the different areas of the business.

“I grab each of the managers and we sit down for about two hours and we go around the table while everyone exchanges what they’re doing,” he says. “You get so focused on the part of the business that you’re in and sometimes you have two different groups sort of working on the same things, or maybe they’re doing something that somebody in another group has worked on and knows the answers to help them out. So those meetings have been very beneficial.”

One of the biggest decisions Kudis has made for Allegheny Petroleum was to give the company a global presence. However, global business carries many challenges along with it.

“Learning how to deal financially in different countries has been a challenge,” Kudis says. “One thing you have to learn is what the tax implications are. Each country is different. You should do business with an accounting firm or law firm that can find out answers for you. That really makes it easy.”

Allegheny Petroleum didn’t utilize those resources in the beginning on the first two countries where the company launched its efforts and there were snags.

“Had I used our law firm or our accounting firm, it would have been a lot easier,” Kudis says. “Make sure you understand what it takes to do business in a foreign country before you start doing business there.”

Another big decision that has streamlined business for the company was using a global pricing index with its major direct customers.

“We now move our pricing quarterly as these prices move,” he says. “In the past every time there was an increase you had to go in and present everything to your customer and sit and argue about the pricing. Now that it’s indexed at the end of the quarter, it’s just a matter of how the pricing has moved and that has really streamlined the pricing.

“Our customers feel very good because they know it’s indexed to something that they can see. I feel good because as my raw material costs rise or drop it keeps my profits pretty steady. It really makes it easy to not worry about the pricing side of your business as much.”

Now that Allegheny Petroleum has streamlined business, entered into global markets and become a substantial player in its industry, Kudis is excited to find where the next level is.

“My vision is how do I double and triple the business,” he says. “Everything had been done organic and we might look at doing some acquisitions. The next level will also mean being more global.

“You have to think down the road and get out of the box to think about things that maybe you haven’t thought about in the past, because once you stop growing you’re done.”

How to reach: Allegheny Petroleum Products Co., (412) 829-1990 or www.oils.com

 

Takeaways:

Find the right talent for your leadership team.

Give the leadership team the autonomy to make decisions.

Constantly look at how to keep growing your business.

 

The Kudis File

Jim Kudis

President

Allegheny Petroleum Products Co.

 

Born: Homestead, Pa.

Education: Graduated from Penn State and received a bachelor’s degree in business logistics.

What was the very first job that you had and what did you learn from it?

I worked in a steel mill. I was a laborer so I drove a high lift and moved different things around. My dad worked there and he said, ‘This man is going to pay you, so you better work so that you make sure you earn every dollar you get.’ I still live by that today.

Who is someone that you looked up to?

My grade-school basketball coach. If we played bad we would come back and practice until 11 o’clock at night to make sure we did things right. We won the state championship that year. Hard work eventually pays off.

What Allegheny Petroleum product are you most proud of?

We make what’s called a backup bearing oil for the steel mills, which is called a Morgoil. When steel mills roll steel it goes between these rolls and on the end of these rolls there are bearings. They are huge bearings that get very hot. The oil goes through to lubricate the bearings and they also cool the bearings on the outside with water to keep them from getting too hot.

So the oil has to be able to accept water and kick out the water as it goes back to the tank and it gets circulated back through the bearings. You don’t want water lubricating your bearings, so our oil kicks out the water pretty good. That’s one of our hallmark products.

If you could speak with one person, whether from the past or present, with whom would you want to speak to?

Joe Paterno. I admired the way he ran the football program at Penn State. I’m not in total agreement with what happened at the end of his career. All through the history of what he did, he represented a class act. He was very well-respected. I enjoyed watching him and what he represented for the school.

Published in Pittsburgh
Sunday, 30 June 2013 20:00

Maintain high performance

Someone once told me, “A mother is only as happy as her least happy child.” When I became a mom, I realized that is one of the most truthful statements ever. When one of my children is sick or miserable, it’s impossible for me to focus and be 100 percent right with the world.

I have observed the same phenomenon with teams. Much is written about what high-performing teams look like: they communicate well, they are aligned, they are clear on their purpose and success metrics; and they hold themselves accountable.

However, rarely is it acknowledged that a team is only as effective as its least effective member. It’s like a chain being only as strong as its weakest link. A team cannot realize its full potential if one member is unhappy, working against the team’s vision and efforts, or is behaving inconsistently with what the company is trying to instill in its culture.

The multiplier effect

In mathematical terms, a team’s divisor should be one. The team is as good as it is, not compromised by any single variable. And, when the team is really rocking, there is a multiplier effect that makes its value greater than it otherwise should be. The multiplier comes when teams are hitting on all cylinders and become greater than the sum of the individuals.

However, a non-contributing team member — or worse, one who works against the grain of the team — is like having a divisor greater than one. This diminishes the size of the end product, no matter how large the starting number is. The team will always be less than what it could be.

This weakening of potential can manifest itself strategically, operationally or culturally.

Strategically, it shows up as a leader not supporting enterprise initiatives, not putting the best talent on companywide efforts that will drive major changes, or focusing on a single vertical at the expense of other verticals or the enterprise as a whole.

Operationally, it shows up as a leader running the business in a way that dishonors agreed-to strategies and priorities, or engages in practices that do not support company policy or commitments, or making decisions that favor the local to the detriment of the whole.

Culturally or behaviorally, we see things like not speaking up in meetings on important topics for which they have relevant input, or making/implementing decisions without gathering input from key stakeholders, or behaving in ways that don’t align with the company’s stated values.

Poorly functioning teams a hazard

The ongoing cost of a poorly functioning team can be high. So what can you do about an ineffective team member?

Always start by making the person aware of the effect that his/her actions are having on the rest of the team and the company — and do it in a way that enables learning on both sides. There may be factors not apparent to others that are causing the team member’s behavior.

The conversation must be about listening as well as telling. Feedback should be given by the person’s boss, a senior HR person, or an outside adviser who may be hired to do a 360 assessment. It is important that the dialogue be constructive to enable a more productive future.

If the feedback changes the behavior, that is wonderful. But if not, then ultimately you have to decide whether this individual’s value outweighs his/her cost. If you can’t change the person’s behavior, your behavior may be to change the person.

 

Leslie W. Braksick, Ph.D., MPH is co-founder of CLG Inc. (www.clg.com), co-author of “Preparing CEOs for Success: What I Wish I Knew” (2010), and author of “Unlock Behavior, Unleash Profits” (2000, 2007). Dr. Braksick and her team help executives motivate and inspire sustained levels of high performance from their people. You can reach her at 412-269-7240 or lbraksick@clg.com.

Published in Columnist

The Patient Protection and Affordable Care Act, often called the Affordable Care Act or just Obamacare, represents one of the most far-reaching government overhauls of the U.S. healthcare system since 1965 when Medicare and Medicaid came into being. It will be phased in over time, with the majority of the changes taking effect in 2014.

The act focuses on increasing the rate of health insurance coverage for Americans and reducing health care costs. Here’s what some area businesses have on their minds about health care reform as the time nears for the full impact of the ACA:

  • Steve Brubaker, chief of staff, InfoCision Management Corp.
  • Craig Shular, chairman and CEO, GrafTech International
  • Alan P. Jacubenta, president and CEO, Mango Bay Internet
  • Rick Hull, president and CEO, Premier Bank & Trust
  • Chuck Abraham, executive vice president/CFO, Hitchcock Fleming & Associates Inc.
  • Rick Solon, president and CEO, Clark Reliance Corp.
  • Andy Zynga, CEO, NineSigma Inc.
  • Jodi Berg, president and CEO, Vita-Mix Corp.

1)      How is your company preparing for changes associated with health care reform?

 

Brubaker

  • With more than 4,000 employees, education is key and our priority is to make sure we provide everyone with the knowledge they need to make informed decisions. There are a lot of changes on the horizon and it’s important we communicate these changes in a timely manner. We are doing this though our internal communication channels such as our employee newsletter, employee intranet and face-to-face meetings.

Shular

  • GrafTech has always provided an excellent health care plan to its team members. We are well-positioned to comply with the PPACA. Our plan is affordable for our employees; therefore, no one will be eligible for government subsidies and GrafTech will not be assessed a penalty.

Jacubenta

  • We are in constant contact with our benefits agent whom we have worked with for a number of years and have been very pleased with his knowledge and service. He attends all the latest classes and seminars available to keep us apprised of the latest laws. He will let us know what's changing with the different carriers and how it might have an impact on our current and future coverage.

Hull

  • Most importantly, we are making sure we stay educated on the changes. It is important that we are able to answer our employees’ questions and also be supportive of their needs. Our budgeting process is robust, and we spend a lot of time in this area making sure we are making the right choices for our employees and our company.

Abraham

  • For more than three years, we have been learning about the requirements since the ACA was passed in March 2010. We will review our current plan design with our benefits consultants this summer. At that time, we will assess any changes that may be required for our 2014 renewal, including the possibility of adding a high-deductible option to our current plan.

Solon

  • Our preparation for health care reform has consisted of our human resources staff reviewing the law with our health care providers and consultants. In addition, our legal counsel has reviewed our existing health insurance programs to insure compliance.

Zynga

  • We are working closely with our brokers, Oswald Cos., for frequent and regular updates regarding health care reform and the related steps of adoption. Oswald advises us of both milestones and compliance requirements so we can plan for and execute on each. Staying informed is most of the battle for us right now as we ramp up toward 2014.

Berg

  • We have been educating ourselves regarding the elements of the law through articles, seminars and benefits affiliations. We offer a fairly comprehensive health plan to our employees today and are constantly monitoring the progress, changes and evolution of what is available in the insurance marketplace. So far we do not believe that the changes will have a large financial impact on Vitamix.

 

2)      What are you doing specifically to contain health care costs for your employees?

 

Brubaker

  • As a self-insured employer, we’ve always placed a high value on providing our employees with comprehensive health and wellness programs. Reducing our claims is a priority by ensuring our employees have convenient tools like on-site wellness clinics and fitness facilities to promote healthy decisions, and decrease employer out-of-pocket expenses. Where many companies are cutting back on amenities, we embrace the concept as a driver of employee engagement.

Shular

  • GraFit is a company-sponsored wellness program that includes free biometric screenings and incentives to make healthy lifestyle choices.

We offer employees the opportunity to purchase fresh produce from a local vendor who delivers to our site every week.

Our leadership team helps shoulder the burden of health care costs too. Mid-level managers each pay an additional $150 per month for health insurance; senior-level executives pay an additional $200 per month.

Jacubenta

  • Every year, we go through a process to get health care quotes from different providers. We compare their offerings in order to get the best coverage for the best price. If a change is warranted and it is cost effective, we do it with the least amount of coverage change as possible. The current provider usually matches what we were able to find through quotes, decreasing the overall increase in price.

Hull

We have opted to continue to pay a larger portion of the overall cost rather than pass that on to the employees. In addition, we shop our benefits annually to make sure we are receiving the best possible coverage at the lowest cost possible. We continue to search for new tools to add to our offering that will allow the employees to have all the benefits they need. We also have a wellness program that is aimed at preventive care.

Abraham

  • Even though not required to at the time, our plan implemented coverage for Essential Health Benefits (basic preventive/wellness services), elimination of pre-existing condition exclusions, and an expanded definition of dependent. Additionally, we have tried to raise “wellness” awareness through a number of efforts: encouraging participation in the Heart Walk and other types of exercise, administering “weight-loss challenge” initiatives and sponsoring yoga and meditation classes at the agency. We also discuss regularly with our associates the importance of wellness, use of network providers, requesting generic drugs when available and proper use of urgent care facilities — in short, being wise consumers of health care.

Solon

  • We started several years ago to educate our employees on the types of activities and choices that drive health care costs. We utilize our health care providers and consultants to propose innovative programs to help us control costs, and we have gone to a wellness program to promote individual health care improvement.

Zynga

  • We have a high-deductible HRA plan in place. We have taken the deductibles up to $5,000/$10,000 for premium reduction. We cost-share the premium with employees — the company pays 75 percent and the employees pay 25 percent of the premium. Further, within the high-deductible plan, we set a sub-deductible of $500/$1,000 for each employee, after which the company reimburses 80 percent of claims until the plan deductibles are met. It may sound complicated, but it’s kept us in the top quartile when compared to our peers for affordability of our plan to employees. We are also in the early phases of a wellness program, which we expect over time will help control/reduce cost increases. The biggest motivation for us to have such a plan is simply to provide resources that keep our employees feeling as healthy and energetic as they can, which we hope translates into more fulfillment while at work.

Berg

  • We take a Total Wellness Approach to our employee benefit plans. We were early adopters of an outcome-based medical benefits coverage that encouraged positive healthy behavioral changes among our employees. Through a combination of biometrics, education, fitness programs, and financial incentives driven by wellness promotion, we will experience the benefit in overall reduced health care costs for the long term. We started a tobacco-free campus in 2012, and do not hire tobacco users. Vitamix still pays 100 percent of its employee medical premium; however, we have implemented a high deductible plan that employees can reduce to zero if they meet the criteria for modified NIH biometrics targets. For example, an employee who meets all target range biometrics for blood pressure, cholesterol, body mass index and smoking, along with participating in health education, training, or regular physical exercise, will incur no deductible for the year.

 

3)      Do you foresee having employees pay a larger share of company-offered health care coverage?

 

Brubaker

  • We’ve always taken a strategic approach to employee health and wellness. What that looks like right now is adapting our offerings to not only comply with the new requirements, but also to provide our employees with coverage that meets their family’s individual needs. We continue to monitor and will comply with all of the reform’s expanded coverage choices so we can provide our employees with effective and affordable options.

Shular

  • That is not our current intention, but we will continue to monitor and evaluate if a change in the cost share model is required. Over the last 10 years, we have managed our program to an annual average inflation rate of 3.7 percent. This compares favorably to the national average of 6.3 percent over the same period. Our concern is that elements of PPACA do not lower insurance costs, but in fact cause the rates to go up.

Jacubenta

  • Things are unpredictable other than we know that there is a good chance that prices will continue to skyrocket. If we had to, we would ask our employees to pay a share of the expense for health coverage. It depends on what happens in the beginning of 2014 with community rates and what they offer versus staying with private insurance and the cost to the company.

Hull

  • Not at this time. Our goal is to allow our employees continued benefits while keeping them affordable to the employee.

Abraham

  • Our goal would be to minimize having employees pay a larger share. Since we are in a service industry that relies heavily on high-caliber talent, our benefits plan is one of several tools used for recruitment and retention. Our goal would be to continue to make the health benefits as affordable and attractive as possible to our employees.

Solon

  • We have always believed that paying a substantial portion of the health insurance premiums is helpful to recruiting the best people. We do not contemplate increasing the percentage that our employees pay.

Zynga

  • We pride ourselves with trying to have a healthcare plan in place that is affordable yet quality coverage for our people. While I think it is too soon to draw a line in the sand about the cost sharing, I can say that philosophically we are opposed to increasing the burden on our employees.

Berg

  • We do not foresee this happening in the future; however, until the full impact of the ACA is discovered, we will reserve our opinion on the matter. Some pundits say it will definitely increase overall costs, while others say more competition will reduce costs long term. We are unsure what our health care insurers will do; however, our focus will continue to be on what we can control, and for now that is our wellness offerings and employee incentives toward better health.

Published in Akron/Canton
Sunday, 30 June 2013 20:00

Improving each customer touch point

Business today is more competitive than ever. With a few clicks of the keyboard, every customer can research, price check and read reviews of your product or service. Many times, with one more click, they can have that same product delivered to their door from anywhere in the world. Want it tomorrow? No problem.

So how does a business succeed in this era of the empowered consumer? How can it differentiate itself? I’ve given this question a lot of thought, and the answer may lie in a practice called Customer Experience Management.

Failing on the promise

Let’s talk about customer experience. How many times has a customer service representative ended a conversation by reciting something along the lines of, “I hope you received excellent customer service today,” when the service was less than gratifying? How satisfied did you feel after hearing their script?

Most businesses pay lip service to the idea of superior customer service, but when it’s time to execute, they fail. Their departments are structured to run their own processes smoothly, not to ensure their customers think, or better yet, say, “Wow.”

CEM asserts that if we put our customer’s experience at the core of our business and subsequently construct functional departments around it, we will gain that competitive edge. Yet, truly understanding the customer’s experience while interacting with your business is easier said than done. So, how does one reinvent a company with the customer at the center?

Start at the touch points

Begin by becoming aware of your company’s touch points — all the places a customer comes into contact with your business. Keep in mind that these touch points vary widely. They include obvious departments such as telesales and customer support, but these touch points also include the clarity of the invoice/statement, your website, your ad in the newspaper, a partner or retailer and many more.

We did a quick count at my company and discovered 26 touch points! Too many for sure, since more touch points mean more opportunities for mistakes.

After you’ve identified the touch points, do some investigating. Be the mystery shopper, in person and on the phone. Listen to the language a salesperson uses to describe your product or service. Do it again. Notice the differences between what you hear depending on who is serving you. How did their actions differ from what you wish they had done?

Once you experience every touch point first hand, you might begin to feel your customers’ frustration, pain and sometimes, surprise. Then you can begin rebuilding toward a satisfying customer experience.

Use CEM as a tool

Right now at EVault, we’re working hard to reduce and improve each touch point using a CEM lens. For us, that means creating simple, valuable, authentic and pleasantly surprising exchanges.

We want each customer to feel that every interaction with EVault was worth their time, was clear that we genuinely wanted to help, and that we did something pleasingly unexpected.

How do you want your customers to feel when they interact with your business? You need to find out and then rebuild.

 

Terry Cunningham is president and general manager of EVault Inc., a Seagate company. He founded Crystal Services, which was purchased by Seagate in 1994 and integrated into the company’s software division, which then became Seagate Software. He has also served as president and COO of Veritas Software, and founded, built and led two other successful software companies.

Published in Columnist

“A ship in port is safe, but that’s not what ships were built for,” is a quote that hangs in Brig Sorber’s office at Two Men and a Truck in Lansing, Mich. Sorber uses that quote to define the new direction in which his company has been moving.

“I love that quote because this ship, Two Men and a Truck, has been in port for too long,” says Sorber, CEO. “We’ve got to get this into deep blue water. There are a lot of challenges out there and a lot more risk, but that’s where business is done. We need to start moving forward and accept the challenges.”

Sorber and his brother, Jon, started Two Men and a Truck International Inc., a moving company, in the early ’80s as a way to earn money using their ’67 Ford pickup. Today, the business has x4,500 employees, more than x1,400 trucks, more than x200 franchises in x34 states, Canada, the U.K. and Ireland, and 2012 revenue of x$361 million.

“We did it to make beer and book money for college,” Sorber says. “We really never thought that it would get to this point.”

However, in getting to this point, the company had neglected to make necessary changes in order to keep the operation aligned and running well.

“One of the challenges we have had is going from a mom-and-pop-type business to having to grow up and become more corporate,” Sorber says. “We needed to bring in newer and stronger skill sets.”

Here’s how Sorber has helped Two Men and a Truck grow up.

Growing pains

Two Men and a Truck incorporated its first business in Lansing, Mich., in 1985 and began franchising in 1989. The company at this time was run by Sorber’s mom since he and his brother were in college.

Upon graduation, Sorber worked as an insurance agent and also operated his own Two Men and a Truck franchise. He returned to the company in the mid-’90s, became its president in 2007 and CEO, the title he carries today, in 2009. In that time the company had grown significantly, but it wasn’t running as well as it could be. Starting in 2007, Sorber’s job was to help restructure the business.

“We had to take a look at ourselves internally,” Sorber says. “There came a time that I just knew things were broken here.”

Because the company was growing so fast there was no organization chart. It was very loose on who reported to whom. It wasn’t that people weren’t working hard, but things were not getting measured.

“I had an epiphany that something had to change big time,” he says. “I made up something that resembled an org chart on a big piece of paper in my office. I brought in five people that I greatly trusted and had confidence in and gave them three markers — green, which meant that person or that job was important; yellow, which meant I didn’t have an opinion either way about this person or about this job; and red, which meant that this job makes no sense.”

Sorber used that as a starting point to help him identify where the company could restructure and cut costs.

“I wanted to give big bonuses to everyone at the end of the year and share the winnings, but we had to prime the pump first,” he says. “We went from 78 employees down to 51 employees after I went through that chart.

“That wasn’t because we were losing money. It was because by the time we realigned everything, there were some people here who weren’t doing anything.”

To avoid issues such as this, you have to have metrics that you measure to make sure whether you’re doing well or not.

“My metrics are No. 1, customer satisfaction,” Sorber says. “Find out how every one of your customers feels about their service. No. 2 is trucks and driveways. We want to put more trucks in more driveways every year.

“No. 3 is franchisees. Make sure your franchisees are profitable and have the tools to grow. No. 4 is giving back to the community.”

Metrics are a crucial aspect of success, but so is a mission statement that helps employees and customers know what the business is about. It also makes your decisions as a CEO simple.

“If your mission statement is strong, it should be limitless,” he says. “For us, we had our mission statement when we had 25 franchises, and now we’re well over 200 and it still applies. You also need core values that comprise what’s important to your company. Once you have those, you have to stay within the confines of your core values.

“When I was a younger executive I thought that was stuff you say to be nice. It’s something that’s serious. You can’t go into work and keep turning the wheel and expect better things to happen. You’ve got to maintain your mission statement, core values, measure what you’re doing, and then you have to look for ways to make things better.”

Bring in key people

As Two Men and a Truck went through these necessary changes, new employees and executives had to be brought in to give the company the right skill sets to continue growing.

“Sometimes we hold onto our executives too long, and we get comfortable with them,” Sorber says. “They may not question what you’re doing. Not all of them, but many of them can be fine with the status quo and as the world is changing they’re not forcing you as a CEO to question what you’re doing.”

You can’t settle for the people who are in your key positions. You need to find people with the right skill sets and make sure they stay within your mission statement and core values.

“Bringing in new individuals is kind of like working on an old house,” he says. “You think if you put new windows on the house it’s good, but then the siding looks really bad. The same thing happens in business when you get somebody that’s great in a department. You start to think, ‘What if I had someone like that in marketing?’”

Sorber brought in executives to fill his company’s voids, and they began offering all kinds of new ideas for the business.

“When I started bringing in these key executives, they wore my carpet out because they have fresh eyes for the business,” he says. “They asked why we did this or that. Many of the things we were doing were the right things, but it’s good for you to make your point about why you do it.

“The new executives will say, ‘That makes sense’ or ‘That’s different.’ Other times they’ll say, ‘OK, but did you ever think about doing this?’”

That is how your business goes through an evolution, and it starts bringing in more modern thinking and different approaches. A business will have a life cycle of only so long, and you need to continually reinvent it because your customer is changing. If you bring in new people they may bring the great ideas you need.

“It’s really important as a president or CEO to hire people who are smarter than you in their specific fields,” Sorber says. “Our job as president or CEO is to look more strategically at where we want the business, make sure the executives play nice together, ensure there’s harmony in the business and keep an eye on those important metrics.”

During the course of the past six years, Sorber has been able to successfully do all those things within Two Men and a Truck. Randy Shacka became the company’s first non-family member to serve as president in 2012. Now, Sorber and Shacka are looking at the future outlook of the business.

“We think we will be a $1 billion company by the year 2020,” he says. “In the last few years we’ve been doing a lot of internal work on fixing where we are broken and getting the right people in here. Now we want to be more than just a moving company. We want to be a company for change.”

How to reach: Two Men and a Truck, (800) 345-1070 or www.twomenandatruck.com

Published in National

Many executives do not view the content they distribute as intertwined with their organization’s unique product or service. However, the two are interchangeable. Your product or service has differentiators that cause your clients to select you instead of the competition. Those same factors apply in content marketing.

If your goal is to engage prospects and ultimately lead them to conversion, you must create content that keeps them engaged. Success comes from creating consumable pieces of content that together form a singular thought leadership message and distributing those pieces across multiple channels. You never know through what channel someone will engage with your brand (or branded content), so the message needs to be consistent.

There are a few simple rules to doing this. Your content and what you’re selling should meet four criteria. It must be:

 

 

  • Useful

 

 

  • Relevant

 

 

  • Differentiated

 

 

  • Available

 

 

Useful means the content, as well as your product or service, has a defined use for a target audience. It addresses:

 

 

  • How do I use this?

 

 

  • How does this help me?

 

 

  • What problem does this solve for me?

 

 

Here’s an example: According to a recent IDC Research report, 49 percent of the entire U.S. population currently uses a smartphone. By 2017, that number is expected to reach 68 percent. That means that within four years, more than two out of every three Americans — regardless of age — will be connected via smartphone. Therefore, a useful product a company might offer could be a solar-operated phone charger. And useful content to distribute to a target audience may include “How to make your daily life easier with these top five iPhone apps.”

To be Relevant, the product, service or content must be new and interesting, and mean something to the market or industry. Your audience will ask:

 

 

  • What does this mean to me?

 

 

  • Do I need this?

 

 

Let’s say your organization provides a website portal that connects insurance companies. New and interesting content that means something might be, “How your health care plan will be affected by reform . . . and what you can do to prepare for it.”

In a world filled with noise, you must demonstrate how what you do is Differentiated from competitors and explain:

 

 

  • How does your content, product and service compare to the competition?

 

 

  • Is it unique?

 

 

Let’s go back to the smartphone example. If you sell or service iPhones and Android-platform models, think about creating engaging content that examines the needs of today’s smartphone user, and then go beyond the basic functionality.

It’s also imperative to understand your target audience and the target audience for each product. Android-based smartphones are primarily aimed at businesspeople. iPhones, for all their bells and whistles, are not. This differentiation has led to a lot of confusion in the marketplace when consumers compare one against the other. Understanding this allows smart marketers to create engaging content such as “The top 10 needs of businesspeople: A comparison of Android phones vs. iPhones.”

Finally, your product, service and content must be Available and easily obtained in any channel.

If you run a benefits company that works with employers, for example, health care reform provides a timely opportunity to help clients make sense of the landscape. This might entail delivering a variety of consumable content that’s available to them 24 hours a day, seven days a week, through any channel.

This could include a video that explains the difference in options available to employers. It could be a social media campaign that outlines the top five differences between the health care insurance exchanges and employer-sponsored health care. Or, it may be a series of print mailers or webinars, or even a dedicated microsite that’s filled with content that details what employers need to know.

When your goal is creating engaging content, your ability to consider — and address — each of these factors may be what’s required to transform engagement into measurable conversion.

Published in National

This is no fish story. Instead, this column is about one of the most important roles an owner or CEO must fulfill on an ongoing basis.

Leaders spend an inordinate amount of time dealing with the issues du jour. These range from managing people, wooing and cajoling customers, creating strategies, searching for elusive answers and just about everything in between. These are all good and necessary tasks and undertakings. Too frequently, however, these same leaders delegate this effort to others or ignore it altogether. To be “in the game,” you have to know when to fish or cut bait.

Successful fishermen know that to catch a fish they have to sometimes cast their lines dozens of times just to get a nibble or bite. The first bite might not result in reeling in that big fish. Frequently, a nibble is just a tipoff as to where the fish are swimming.

The same applies to reaching out — casting a line, if you will, to explore new, many times unorthodox, opportunities for your organization. These opportunities can be finding a competitor to buy, discovering an unlikely yet complementary business to partner with or snagging a new customer from an industry that had heretofore gone undiscovered.

All of this takes setting a portion of your time to investigate unique situations, as well as a healthy dose of creativity and the ability to think well beyond the most obvious.

Too many times even the most accomplished executives lack the motivation to look for ideas in unlikely places. Some would believe that it’s unproductive to spend a significant amount of time on untested “what ifs.” Just like sage fishermen, executives can also cultivate their own places to troll.

Of course, networking is a good starting point, particularly with people unrelated to your business, where sometimes one may fortuitously stumble onto a new idea that leads to a payoff.

Other times, a hot lead might come from simply reading trade papers, general media reports and just surfing the Internet. The creative twist is reading material that doesn’t necessarily apply to your own industry or to anything even close to what you do. New ideas come disguised in many forms and are frequently hidden in a variety of nooks and crannies. This means training yourself to read between the lines.

Once something piques your imagination, the next step is to follow through and call the other company or send an inquiry by email to state that it might be worth a short conversation to explore potential mutually beneficial arrangements. This can at times be a bit frustrating and futile. That's when you cut bait and start anew.

However, reaching out to someone today could materialize into something of substance tomorrow. The often skipped but critical next step, even after hitting a seemingly dead end, is to always close the loop with whomever you made contact. Even if there is no apparent fit or interest at the moment, it’s easy and polite to send a short note of thanks and attach your one-paragraph “elevator” pitch.

That same person just might be casting him or herself, be it in a month or even a year later, and make contact with a different organization that’s not a fit for him or her, but recall you because you followed through and created awareness about your story.

This just might lead the person with whom you first spoke to call you because you had had the courtesy to send that note. Bingo — you just got a bite all because of continuing to cast your line.

Good CEOs and honest fishermen also have one other important characteristic in common: humility. They know that when a line is cast it won’t result in a catch every time. But if nothing is ventured, it’s guaranteed there will be nothing gained. Don’t let that big one get away. Just keep casting.

Published in National
Sunday, 30 June 2013 20:00

Movers & Shakers July 2013

Wells Fargo Advisors has announced that Jeremy Baynes, CFP has joined the Hudson, Ohio office as associate vice president of investments. Baynes joins the firm from Edward Jones. He holds a B.B.A. in finance from Kent State University and has nearly 11 years of experience as a financial advisor.

 

Alliance Solutions Group, a full-service staffing and recruitment agency, and NSL Analytical Services Inc., an independent commercial testing laboratory, have been named 2013 Leading EDGE Award winners. The two companies are among 101 midsize companies in Northeast Ohio recognized for demonstrating exceptional business growth and contributing to the local economy.

The Entrepreneurs EDGE is a non-profit organization that drives growth for Northeast Ohio companies by serving as a strategic resource for CEOs and their leadership teams. EDGE focuses on the creation of programs, services and events for current and future midsize companies ($5 million to $1 billion in revenue) that sell some of their products or services outside Northeast Ohio.

 

As Ernst & Young’s 2012 Northeast Ohio and National Entrepreneur Of The Year winner for manufacturing and distribution, Magnus International Group founder, Eric Lofquist is also a local judge for the 2013 awards program. Additionally, he has been selected to help officiate the national EOY competition from 2014 to 2016.

Considered the world’s most prestigious business award, Entrepreneur Of The Year has been celebrating extraordinary performance since 1986. Today, the competition has expanded to more than 140 cities in more than 50 countries.

 

Brouse McDowell, a leading regional business law firm, is pleased to announce that Heather M. Barnes has been named chair of the intellectual property practice group. Barnes is a partner in the firm’s Akron office and is a registered patent attorney. Her practice includes the domestic and international prosecution of patents, trademarks and copyrights, as well as litigation research pertaining to all areas of intellectual property.

 

Taft Stettinius & Hollister LLP recently announced that two of its attorney’s, William Phillips and David Wallace, were recognized as “Leaders in their Field” in the 2013 edition of Chambers USA.

In addition, Taft is once again “Top Ranked” in its Ohio Labor & Employment practice. The firm is recognized as a “Leading Firm” in 11 practice areas.

 

Diebold Inc. announced its board of directors has named Andy W. Mattes as the company’s new president and CEO. Mattes was also named a board director. In addition, Henry D.G. Wallace, Diebold executive chairman of the board, will assume the non-executive chairman role effective August 15.

Mattes, 52, has a strong record of driving growth and improving profitability in large, global businesses. He has more than 25 years of experience in the information technology and telecommunications industries - primarily with Hewlett-Packard Co. and Siemens AG.

Mattes most recently was senior vice president, global strategic partnerships at Violin Memory, a manufacturer of flash memory computer storage systems. He will remain with Violin in an advisory role.

Diebold Inc. is a global leader in providing integrated self-service delivery and security systems and services.

Published in Cleveland

As an organization grows, changes are inevitable.

New employees are added, promotions are made and job responsibilities shift.

But any time you have change, you have the potential for conflict. Few people are comfortable with change, and each person will react differently in making the adjustments necessary to move forward with the company.

The most important thing a CEO can do is to be active in confronting potential conflict. Conflict goes hand-in-hand with change. Employees begin to question management, co-workers and even themselves as they are forced outside of their comfort zones. Those questions can lead to misunderstandings that can lead to conflict, and that will ultimately slow your growth.

Don’t passively avoid potential conflict. Instead, actively engage members of your organization by providing the necessary forums both for you to communicate your strategy and vision and for them to communicate their concerns back to you. An active conversation will help drive your vision for the company through the organization and will also help foster your next generation of leaders as they take a more active role.

Only when employees are challenged to think — and to challenge you — will you maximize your organization’s potential. Do you want employees who don’t speak up when they recognize what may be a fatal flaw in your grand strategy? Or would you rather have employees who are actively thinking about the big-picture goals of the company and doing their part to contribute?

Regardless of what size company you run, it comes down to a simple choice.

It’s a choice between having employees acting like robots or acting like people. If you choose robots, you will have to have all the answers. If you choose people, you only have to have some of the answers because the employees will help you find the rest.

Engaging employees in conversations, meetings and decision-making helps them take ownership and helps you create a happier work force. If they are not allowed to speak, gossip and rumors will drag down your productivity.

Actively provide two-way communication. Let employees do the talking and hear what they have to say. The results may surprise you. Those closest to the customer often know best what needs to be done to improve sales, service or efficiency.

Too many CEOs lament the lack of good people to help take them to the next level. Maybe the problem is more CEOs need to create good people rather than driving them off with a work environment that’s better suited to a good robot.

Published in Cleveland

Legend has it that in 1505, shortly after Michelangelo’s David was placed at the main entrance to the Palazzo Vecchio, Pope Julius II marveled at its brilliance and questioned the artist about how the masterpiece was created.

As the story goes, Michelangelo responded, “I saw the angel in the marble and carved until I set him free.”

Whether this conversation actually happened is anybody’s guess, but the exchange provides a glimpse into the mind of a genius who could see what others could not.

Today, similar visionaries populate the landscape. In the business world, they often manifest themselves in the form of entrepreneurs.

One of the greatest skill sets that entrepreneurs possess is the ability to balance calculated risk-taking with a dogged pursuit of ideas they believe will succeed. This is combined with a passion for the solutions, products and services being offered, and a keen understanding of the marketplace. Entrepreneurs have a very good sense of what people will or will not buy, and are willing to continuously tweak their solutions to adapt to changing needs, wants and desires.

But draw back the curtain a bit more and you’ll find that an entrepreneur’s real mystique lies elsewhere. It is his or her mysterious sixth sense used for noticing gaps in the marketplace that others fail to see. It is the ability to understand the gap and develop effective solutions that fill it.

Thirty years ago, who could have predicted how ubiquitous smartphones would be?

Sure, if you watched episodes of Star Trek in the 1960s you noticed those nifty communicators that Captain Kirk and his crew used. They not-too-surprisingly look like the early flip phones of the late 1990s and early 2000s.

But today’s smartphone — essentially a pocket computer that packs so much power — required a different kind of vision, much like Michelangelo seeing the angel in the marble.

Most of the savviest entrepreneurs I know go through life looking at what will be once you remove everything that doesn’t belong. They see opportunities to create markets where markets do not or have not existed. Their efforts, and vision for what could be, fuel the economy and create jobs.

Entrepreneurship is not for the faint of heart, however. Even the best ideas often fail. Depending on which source you believe, as many as nine out of every 10 new business start-ups won’t make it to year three.

Two other factors play critical roles in bringing what you see to life — timing and people.

Having the right idea at the wrong time can doom even the most passionate of efforts. And if you don’t surround yourself with smart and capable people who complement both your strengths and weaknesses, you’ll either swiftly run out of bandwidth or be unable to effectively execute on the ideas.

All of which brings us back to the idea of vision.

How important is vision and this mysterious ability to see what’s not there?

It is the true crux of success. Vision is knowing what’s needed for the right market at the right time at the right price point. It is understanding through which channels the solutions need to be delivered. And it is recognizing how to best amplify an idea so you can reach as large an audience of potential consumers as possible and maximize revenue opportunities

Michelangelo summed up his artistic philosophy simply:  “Every block of stone has a statue inside it. It is the task of the sculptor to discover it.”

As entrepreneurs, the question is therefore straightforward:  How will you discover the next great business idea? And more important, can it have as lasting an impact as David?

Published in Cleveland
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