One of my favorite business books, which also made it as a Broadway play and a big-screen movie, is “The Wonderful Wizard of Oz,” written by L. Frank Baum in 1900. My hero in this story is not the young orphaned Dorothy, nor the Cowardly Lion, the desperately in-need-of-some WD-40 Tin Man, nor even the Scarecrow in search of a brain.
Instead it is the Wizard. To understand why the dubious Wizard is my favorite character, one must get past the portrayal of him as scheming, phony and at times nasty.
To appreciate the man behind the curtain, recognize that he is a very effective presenter, though at times this ex-circus performer behaved a bit threatening. OK, he was a jerk, but the point of this column is to take you down the yellow brick road on the way to the enchanted Emerald City and corporate success.
From this tale there is a lesson that one can say all sorts of things, not be visible, and yet still have a meaningful impact.
Another takeaway is that playing this role provides plausible deniability. This absence of visual recognition is particularly beneficial in negotiating when you, as the boss, use a vicar, aka a mouthpiece, to speak on your behalf. This allows you to have things said to others that you as the head honcho could never utter without backing yourself into a corner.
Another plus is you can always throw your mouthpiece under the bus if necessary, of course, with his or her upfront understanding that sometimes there must be a sacrificial lamb. This is not only character-building for your stand-in, but also many times presents an unprecedented opportunity for him or her to learn in real time.
Perhaps the Wizard was the first behind-the-curtain decision-maker, but today this role is used frequently in business and government. In a similar vein, the “voice” of Charlie from the well-known 1970s TV series “Charlie’s Angels” was always heard, but he was never seen.
Frequently there is much to be said for using anonymity to float a trial balloon just to get a reaction. Think about a son having his mom test the waters by talking to dad before the son tells him he wants to drop out of junior high school to join the circus. Maybe that’s even how our former circus-drifter-turned-Wizard-of-Oz got his start.
In the negotiating process it is important to have a fallback when the talks hit a rough patch by instructing your vicar to backpedal, saying that he or she has just talked to the chief and the benevolent boss said, “I was overreaching with my request.”
This also serves to build a persona for the boss-behind-the-curtain as someone who is fair-minded and flexible. All the while, of course, it’s the boss who is calling the shots and maneuvering through the process without getting his or her hands dirty.
The value of using this clean-hands technique is that it enables the real decision-maker to come in as the closer who projects the voice of reason, instead of the overeager hard charger who at times seems to have gone rogue.
It actually takes a bigger person to play a secondary role behind the curtain rather than always be in the limelight. It also takes a hands-on coach and counselor to maneuver a protégé through the minefields to achieve the objective.
However, accomplishing the difficult tasks through others is true management and the No. 1 job of a leader who must be a master teacher.
After you have guided a handful of up-and-comers a few times through thorny negotiations, you will gain much more satisfaction than if you had done it yourself, while engendering the respect and gratitude of your pupils. They in turn will have learned by doing, even though they were not really steering the ship alone.
The final step is to let the subordinate take credit for getting the big job done. This will also elevate you to rock star status, at least in his or her eyes. Soon those who you’ve taught will emerge as teachers too, and the big benefit is that you will populate your organization with a stellar team of doers, not just watchers.
So, forget about the Wicked Witch of the West and move backstage for the greater good of the organization.
“America likes cheap gasoline,” says Sandra Dunphy, director of Energy Compliance Services at Weaver. “But as much as we want cheap gasoline, we also want clean gasoline and clean air — and they are not necessarily mutually exclusive.”
In the balancing act between the two, Renewable Identification Numbers (RINs), which are attached to gallons of renewable fuel as it is produced, have become very valuable to the oil companies required to own them.
“If you bought 1 million RINs on Jan. 1, it would have cost you about $70,000,” Dunphy says. “Today, that same purchase would cost about $1 million.”
Because there’s so much money in RINs, there’s also the potential for fraud. After a handful of fraud cases rocked the market, the Environmental Protection Agency (EPA) has stepped in with a solution — Quality Assurance Plans (QAPs).
Smart Business spoke with Dunphy about the EPA’s Renewable Fuel Standards program and how QAPs fit in.
How do RINs and the RFS program work?
Congress passed the Energy Independence and Security Act in 2007 to introduce fuels with lower greenhouse gas emissions, reduce dependence on foreign oil, and promote domestic agriculture and employment. This act spawned the EPA’s RFS regulations that encourage biofuels beyond corn ethanol — those made from non-food sources like used cooking oil, wood chips and algae.
Oil refiners and importers of gasoline or diesel are required to own a certain amount of RINs at year-end. The RFS requirements will increase annually from about 16.5 billion gallons in 2013 to about 36 billion gallons by 2022.
Why have RINs become so valuable?
We are hitting the blend wall. When this law passed, Congress anticipated that the volume of gas and diesel we consume would increase each year. But demand has fallen with fuel-efficient vehicles and fewer driving miles, and now there’s nowhere to put additional renewable fuel into the declining gas and diesel pool. Anticipating higher mandated renewable fuel volumes, and a possible shortage of RINs, many oil companies are buying RINs now to use in 2014 — 20 percent of RINs can be carried forward from one year to the next.
Why did the EPA create the QAP program?
Since 2011, a few RIN fraud cases have shaken the market’s foundation and made oil companies nervous about buying renewable fuel or RINs, after the EPA penalized oil companies who used fraudulent RINs for their annual compliance needs. As a result, many oil companies started buying only from the biggest renewable fuel producers who had the ability to replace bad RINs, and small fuel producers suffered.
The QAP program seeks to address the concerns of invalid RINs in the market and tries to level the playing field.
How does the QAP program validate RINs?
There are three options available to a domestic renewable fuel producer or importer with this program. The first option is to maintain the status quo, where oil companies do their own due diligence reviews.
Second, under the QAP-B program, the producer hires an auditor to audit its paperwork and conduct an engineering visit quarterly to ensure the energy and mass going into the plant are equivalent to the energy and mass going out. It reassures those buying the RINs that the producer is doing everything it is supposed to. The oil company has an affirmative defense against EPA penalties if they use a QAP-B RIN for compliance. They just might have to replace bad RINs if the producer cannot.
Another option is the QAP-A program. It’s the same as QAP-B, but the scrutiny is more ongoing. In addition, the auditor must hold an insurance policy. So, if a producer makes an invalid RIN and can’t replace it, the auditor is responsible.
What’s the timeline for the QAP?
The EPA has not issued the program’s final regulations. That is likely to happen in the third or fourth quarter of this year and become effective beginning in 2014. However, the EPA is encouraging producers to get started now. A renewable fuel producer’s purchasers will probably dictate what type of QAP the producer will need, if any.
Sandra Dunphy is director of Energy Compliance Services at Weaver. Reach her at (832) 320-3218 or email@example.com.
Follow up: Weaver has been pre-approved to perform U.S. EPA RFS Quality Assurance Plan audits. Contact Sandra Dunphy if you’re a domestic producer or importer of renewable fuel and would like to learn more.
Insights Accounting is brought to you by Weaver
A few years ago, one of my friends embarked on what he deemed an ambitious, yet simple plan: Write a New York Times Best Seller.
“Ed” had reason to be optimistic: His first two books had sold well and he had successfully leveraged them to launch a burgeoning consulting practice. Ed also had a nationally known book publisher to handle distribution for this book, and he had developed a comprehensive marketing and promotions plan for the launch.
Ed felt all the pieces were in place and was sure he would succeed. His goals were two-fold: break out from the pack and grow his business, and hit the New York Times Best Seller’s list. While his head told him the first goal was more realistic, his heart was set on the second — publicly claiming it was his only true benchmark of success.
Needless to say, Ed’s book didn’t make the list. Few books do. That doesn’t mean Ed’s book was a failure. Quite the contrary, it was a huge success.
As a result of Ed’s book, he landed numerous speaking engagements with organizations and companies around the world. He began to command four- and five-figure speaking fees from those engagements, and his book was purchased and distributed to every attendee.
Further, Ed’s speaking engagements lead to dozens of private companies hiring him to provide one- and two-day seminars, where he taught executive teams how to implement the ideas he espoused in the book. Ed was also presented with numerous business opportunities for new and existing clients to tackle initiatives beyond the book’s subject matter that he had not previously considered but were related to his expertise.
Finally, Ed did sell thousands upon thousands of copies of his book in bookstores nationwide and online through booksellers like Amazon.com and BarnesAndNoble.com. His book was in the hands of the right people — and lots of them — and he had established a national profile.
Viewed through this lens, there is little doubt that Ed’s book was wildly successful — even if it wasn’t a New York Times Best Seller and even if it didn’t stack up to his primary benchmark.
This is the reality of book publishing. Each month, I speak with dozens of entrepreneurs and CEOs about their nascent book ideas and the possibility of having Smart Business Books handle development and publication of their stories and manuscripts. I begin every conversation the exact same way: “If your goal is to have a New York Times Best Seller, we’re not the right option for you.”
That’s because you should write books for the right reasons. If your only goal is getting on a best-seller’s list, then your ambitions are off the mark. Writing and publishing a book is not like a professional sports team’s season — there isn’t one winner who takes the championship and a bunch of losers who fall short. Publishing a book is not an all-or-nothing proposition.
This isn’t to say you shouldn’t aim high with your goals, and having your book become a best-seller is certainly one way to measure success. Setting reasonable expectations, however, is essential.
So why write a book?
One of the most important questions you should be able to answer when thinking about writing a book is, “Who is going to read it and why?”
As Ed’s story demonstrates, a book is a very useful business development tool. It is an immediate conversation starter, an excellent credibility builder and one heck of a leave-behind. If you’re engaged in marketing, why not capture your expertise through a book?
Another reason is to celebrate a milestone or establish a legacy piece. It could be for a 50th or 100th anniversary, or to recognize the history of an organization upon the founder’s retirement or death.
And, if you are interested in helping others succeed, a book is a great way to share your expertise or what makes you and your organization special. For example, if you’ve built an amazing corporate culture where productivity blossoms and innovation flourishes, the “how” and “why” are good subjects for a book. And if you’ve been involved with several mergers and acquisitions, consider sharing what worked and what didn’t, and the lessons learned along the way.
Whatever your story, the key is having a reason to share it with others. The bottom line: It’s your story. Make it count.
Jonathan Brett Klein
CEO and co-founder
CEO and director
In a decidedly old-school industry, oil and gas, Jonathan Klein and Luis Luque are a breath of fresh air. They have worked hard to build Cimation as both a company and a brand with a specific identity and corporate message unlike many of its competitors.
Where other companies may scoff at marketing as expensive and unnecessary, both understand the importance of a cohesive, modern marketing strategy. This initiative enables Cimation to compete with Fortune 500 technology companies for top industry talent and has helped earn business accolades even beyond the energy sector.
They have created an energetic environment where people truly love to work. All employees are encouraged to pitch new business ideas and are rewarded for their success along the way. Employees are not confined by their job title; instead, they are urged to seek out training opportunities and develop expertise across multiple areas.
The collaborative work environment at Cimation encourages employees to offer critical insights and constructive feedback. Recently, in a strategic rollout across all of Cimation’s offices, Klein, Luque and their executive team launched a series of focus groups centered on key business areas. These contributions to the overarching company goals increased engagement at the grassroots level and improved employee satisfaction.
Klein and Luque believe — and Cimation’s sustained success attests to it — that empowered, engaged and appreciated employees are more productive and work harder to support the ambitions of the entire company.
The duo cofounded Cimation in 2009 at the height of the recession when most businesses were struggling to remain open. Nevertheless, theyhave led the company to success from day one, increasing revenue, profits, head count and industry accolades year upon year.
They recently spearheaded an intellectual property initiative that will see Cimation developing new packaged technology solutions and other forms of intellectual property in the near future. Although a risky move in an industry overcommitted to underperforming technology, their vision of Cimation as a truly “great” company demands that they continue to push the envelope.
How to reach: Cimation, www.cimation.com
Founder and CEO
Joel Bomgar was great at fixing computers, but the unbillable time he spent traveling from one client site to the next was making it pretty tough to make any money.
He decided there had to be a better way and after realizing there wasn’t a good product on the market, he went to work to develop his own solution.
He developed his own remote support software that enabled him to troubleshoot customers’ computers through the Internet from the comfort of his own desk.
More importantly, he didn’t have to drive anywhere to identify these problems.
Over the past decade, that piece of software has evolved into the Bomgar Box, a robust remote support solution now used by nearly 7,000 organizations in 65 countries worldwide.
As the founder and CEO of the company which he named after himself, Bomgar has forged his success by focusing on the niche remote support market versus diversifying. He targets large enterprises instead of consumers and produces an appliance-based solution instead of software as a service.
The company itself has a positive, fast-paced culture that is family friendly and is based on Bomgar’s own values and desire to work in a place he believes to be “the best place on the planet.”
Innovation is a priority for Bomgar and he gives employees the freedom to create as long as it feeds the company’s primary goal of improving tech support. This freedom within focus approach allows product engineers and developers to explore futuristic ideas while keeping everyone moving toward the same end goal.
There is also great freedom when it comes to choosing philanthropic causes to support. Bomgar wants employees to support causes that are important to them personally. The Bomgar Care Network is a rotating team that solicits ideas for philanthropic activities from employees and then leads activities in support of those programs. The company also donates its technology to nearly 100 missions around the world.
How to reach: Bomgar, www.bomgar.com
Peter M. Duncan
Founder, president and CEO
Peter Duncan has led multiple start-ups over his long career in geophysics. In his most recent venture, Microseismic Inc., he has created a company that utilizes cutting edge technology to help customers monitor their reservoirs.
He had the vision and work ethic to commercialize an idea for passively monitoring seismic activity from the surface, which many industry experts thought at the time was impossible. Further, he was able to adapt his technology to meet the demands of the market as the U.S. shale plays came online and the recent domestic natural gas and oil boom began.
At the time of Microseismic’s inception, the demand for frac monitoring was virtually non-existent, but seeing the opportunity for his company’s technology to enhance customer value by monitoring their growing number of non-traditional, enhanced recovery wells, he has pioneered a new industry that has much larger companies scrambling to replicate.
Microseismic competes with organizations that are far larger in size, and recently competitors have taken notice of Duncan’s success and competition is heating up. Duncan, who is founder, president and CEO, believes that competition is what will make his company even better, which is evidenced by the continued growth of Microseismic.
However, one of the biggest challenges that he believes his company faces is the need to convince users of his services and that his technology can provide additional critical data to make their drilling programs better.
According to Duncan, just a few years ago, only 0.5 percent of all fracked wells were monitored and recently that number has grown to just 4 percent. Obviously, there is room to grow, and Duncan views this challenge as a great opportunity. He is actively working to analyze and present the data that his company collects to convince engineers how valuable this relatively new technology can be to their drilling programs.
Today, Duncan’s willingness to take risks and go against conventional wisdom has given Microseismic a 95 percent share in the market.
How to reach: MicroSeismic Inc., www.microseismic.com
Michael L. Soper
President and CEO
Legacy Funeral Group
While many entrepreneurs recall that they started their business careers at an early age, not too many have started at the ripe old age of 7. That’s when Michael Soper began his lawn sprinkling service.
It was during a drought in 1973 that he got the idea that since a daytime sprinkling ban was in effect. Young Soper would charge $5 per house to during sprinklers on and off during the permitted hours of midnight to 4 a.m.
Many ventures later, Soper had graduated from college and had a short stint at Kanaly Trust Co. as a financial planner. He had an opportunity to attend the Texas Funeral Directors Association conference in Fort Worth at the last minute. At that convention he found his calling in the funeral service industry, with an interest that much of the money held in trusts was being invested in CDs — and it was a huge opportunity to help these small business owners.
He soon ran the Southwest Guaranty Trust’s funeral and cemetery division, bringing impressive growth. In 1998, he left to start Legacy Funeral Group, taking out a second mortgage against his house and with a motivation to help small town funeral home owners that needed somewhere to go.
Soper developed a vision to create a regional holding company that would acquire rural family funeral homes. He realized that in small towns it was important to retain local people for continued success after an acquisition and encouraged many former owners to stay engaged in the business.
While Legacy has grown to become one of the largest private companies in the death care provided industry, Soper strives to maintain the small company feel, believing and implementing a strong people culture in his firm.
The company is projected to grow by 20 percent this year. Soper’s goal is grow the business to 100 funeral homes by 2017.
How to reach: Legacy Funeral Group LLC, hwww.legacyfuneralgroup.com
President and CEO
Frosch International Travel Inc.
As the second generation of the family business, Bryan Leibman became president of Frosch International Travel Inc. in 1999. Under his leadership, Frosch has experienced extraordinary growth over the past decade.
The company has grown from four agents in one office to more than 1,100 employees across 27 offices nationwide and ownership in an international network spanning more than 42 countries. During the past five years, Frosch has experienced a 30 percent annual growth rate. In 2012 Frosch was honored by Inc. as one of the fast growing privately-held travel and
hospitality companies in the U.S.
Today, Frosch is one of the top 10 travel management companies in the United States. Known as a visionary for the travel management business, Leibman led Frosch to pursue his dream for a profitable travel business that reflects today’s distinctive needs of the modern business and leisure travel markets. He has turned his passion for travel into investments in the best technology and strategic acquisitions to become a top travel agency.
Leibman’s passion for travel is the biggest driver for originality and innovation at Frosch. The company has established service, technology, relationships and experience as the keys to success in the ever-changing travel industry. Frosch stands out from its competitors by offering a superior level of personalized service through the creative management of clients’ travel costs using innovative technology.
With the evolution of the travel industry, the profit margins for traditional travel agency businesses have shrunk and many smaller travel agencies have folded under competition from the Internet and airline commission cuts. Leibman takes a highly proactive and realistic approach to create better and more effective products, processes, services, technologies and ideas.
Today, Frosch boasts market-leading innovations that deliver added value to clients. Leibman has created a business model that capitalized on the most current and innovative technology in order to offer customers the best service and travel experience.
How to reach: Frosch International Travel Inc., www.frosch.com
If you work for Drake Mills, you need not worry about being told what to do at every turn. As president and CEO at Community Trust Bank, Mills takes great joy in seeing young leaders advance in the organization and apply their talents to help the bank service its customers better.
He doesn’t leave them completely on their own, but rather sets a course and lets them figure out the best way to follow it. He measures and advises, but he doesn’t micromanage, and the approach has enabled his team to stay together and work quite effectively as a group. He has not lost a vice president or higher level senior leader in six years.
Community Trust Bank has grown substantially over the past 10 years with much of that growth coming during a recession that has hampered many businesses, specifically those in the financial industry. The growth of credit unions has provided another potential hurdle.
But Mills has proven adept at working through challenges by knowing when to take risks and when to be more cautious.
He is also a big believer in building and maintaining a healthy corporate culture. To that end, he created a Culture Council to help define, manage and continuously enhance the company’s workplace and deal with any issues that arise. He also created an entire department devoted to ensuring that the culture remains consistent as the company continues to grow.
The result is a company that provides exceptional customer service and a dynamic work environment that contributes to the performance of the bank and helps Community Trust retain best-in-class talent.
When the work is done, Mills takes his commitment to people another step further by getting involved in causes such as the Boys and Girls Club of North Central Louisiana and the United Way of Northeast Louisiana. Employees also can get up to 20 hours of paid time each year to work on charitable causes.
How to reach: Community Trust Bank, www.ctbi.com