Initially, the company provided on-site support services, sending technicians into the field to fix problems. But as time went by, technologies were developed that allowed Netfor technicians to fix problems using remote control technology.
From there, the company grew into a full-service help desk that takes calls from approximately 30,000 end users around the country. And as Netfor has continued to come out with new technologies, it has grown in size and popularity. Revenue for 2003 was $1.6 million, growing to $2.5 million in 2004.
Smart Business talked to Medley about Netfor’s fast growth and rapidly changing technology.
What obstacles did you have to overcome as Netfor grew?
Cash. We’ve never borrowed any money. Early on, I was able to leverage credit cards. We’ve really shied away from going to investors it’s a wholly owned company.
We haven’t gone after venture capital, and we haven’t borrowed money from banks. We’ve grown on our own profits. We could probably have 80 employees instead of 34 if we would have sold out to somebody.
To what do you attribute your company’s fast growth?
In the late ’90s, a lot of companies tended to be product-focused, selling only certain products, like Microsoft. We made a commitment around 1998 to become more client-centric. That basically meant we started taking the interest of the client and what they wanted into account, rather than what we thought they wanted.
It was really about listening. We parlayed that into developing products around what a lot of clients wanted. We developed a customer satisfaction tool to track the satisfaction of our clients.
We also developed a piece of software that is Web-based, that allows enterprises like our clients, as well as our own technicians, to track all of the issues through a single interface. Everyone can work on issues as needed and can assign them from one person to another.
Then the managers and owners of the companies can report on all these issues. They can find out where the problems are in the enterprise and check which technicians are fixing the most problems and which are fixing the least.
How do you plan to continue your company’s growth?
We continue to develop and implement the latest technology for our clients so that they can utilize everything on the cutting-edge that’s available to them when it comes to support and installation of their computers. We’ve partnered with Cognos, which is a business intelligence software company, so that we can elevate the quality of the reports that we give our clients.
One of the vertical markets that we work in is K through 12. A lot of the employees that we bring on here are high school graduates rather than college graduates.
We started working with the Department of Education in Indiana to help write the curriculum so that kids coming out of high school are better educated and have more hands-on experience when it comes to technology. Then they are more employable when they come to companies like mine.
How do you train new employees?
We go through the basic certification process. But, for the most part, because we are customer-focused, we go through a process with our new clients where we go on-site with them to their enterprises and learn their technologies. Not specifically how to fix one piece of hardware, but how they use it.
That way, when they call into our service desk, we know what they are using it for, and then we can better service them.
We also have a great knowledge base where we capture information about a particular issue so that it can be used the next time that issue pops up.
How do you differentiate your company from the competition?
We are unique and really don’t know anyone else like us out there. We both own the software that we use and provide the resources or the people to actually do the service.
Most software companies sell to help desk companies who own the people. Most help desk companies don’t write their own software. They buy it from someone else.
We’re unique in that we write our software. Our customers see a lot of value in that and a lot of customization opportunities. If they need a certain button there or certain feature there, they know they can get it with us, whereas if they are using a different piece of software, we all know how easy it is to call up Microsoft and ask them to change their software to make it easier to use.
What are your growth goals for the future?
We feel like 57 percent is a good number, so we’re trying to maintain 50 percent to 60 percent growth. Recently, we started testing the waters out in other states. One of our growth goals is to grow our partners program into other states. That is something that I am working intently on.
Those are our two focuses right now, as well as continuing the development of our own technology.
HOW TO REACH: Netfor, (877) 638-3674 or http://www.netfor.com
At the same time, most employers have largely ignored and even diminished the greatest untapped resources of performance gains and competitive advantages the health, well-being and functionality of their employees.
There are major challenges to worksite health and productivity. The average age of workers is increasing, and with each year the cost of health care increases by 3 percent. Keeping in mind that at least 25 percent of health care costs are preventable, it only makes sense that program design affects use patterns and costs.
The reality is that productivity costs are much bigger than absenteeism and disability. Presenteeism being physically present at work but being less than optimally productive makes up about 20 percent to 60 percent of all costs for 10 leading health conditions, and in many cases costs are higher than medical. The magnitude of the demonstrated loss of productivity time is startling, with a number of medical conditions and lifestyle behaviors contributing to between three and 11 hours of lost work time each week per employee.
A new movement has emerged. Health and productivity management, defined by the Institute for Health and Productivity Management as “the integrated management of health and injury risk, chronic illness and disability to reduce employees’ total health-related costs including direct medical expenditures, unnecessary absence from work and lost performance at work (i.e. presenteeism).”
This model applies a proactive approach to better health for individuals by integrating health-management programs to optimize health care delivery and costs. It is all about maximizing human capital investments and producing the best functional outcomes that lead to productivity gains for employers. There is no question that employee health is a capital investment, not an expense. The following are key elements of health and productivity management.
- Comprehensive focus
- Well-integrated interventions
- Metric-driven refinements
- Prevention-centric focus
- Use of active recruitment strategies and techniques
- Strategic alignment
- Systems approach to interventions
- Health as a major strategy for human capital enhancement
- Strong economic focus
So how do health and well-being issues impact the bottom line? Numerous health risk factors have been associated with an increase in short-term absence, including obesity, stress, physical inactivity, smoking, alcohol consumption and poor sleep. Research suggests the impact of these have upon absence levels range from 15 percent to 23 percent of total absence time, and if addressed, would reduce absenteeism levels by some two to three days per employee per year. With interventions, results show reductions in absenteeism ranging from 14 percent to 30 percent in such organizations as DuPont and Coors.
Below are three ideas for improving employee productivity.
- Implement a population health management benefit that keeps the majority of employees who are mostly healthy most of the time in that category.
- Provide targeted disease management to minimize total costs for the increasing numbers of chronically ill workers by keeping them as functional as possible.
- Engage employees in active management of their own health through tailored behavioral change programs, as well as instruction in medical self-care techniques.
We are in a time when health and productivity management is not just nice to have for organizations, it is an area that has a clear and demonstrable business imperative. The new evidence is that health and performance optimization is the new model for global business competitiveness.
Sally L. Stephens, R.N., is president of Spectrum Health Systems. Stephens founded Spectrum Health Systems, an independent health management company, in 1997 to provide Fortune 100 quality health risk management programs to middle-market employers. Reach her at (317) 573-7600 or email@example.com.
First job: First job out of college, I went back to a family business, I was third generation.
What has been your greatest challenge in business?
I think one of the things, when we started, was that I ran from failure. I sort of got into business and realized how much I didn’t know and how little money I had, and I really did run from failure.
And that is a challenge it’s not a good strategic plan. But now I run to success, and that is a far more exciting thing. It’s a more positive thing to do.
What has been your greatest business lesson?
I worked for a family business, and you sort of grow up in a family business and you don’t know anything different. And you learn very quickly that you treated everyone in that company with respect.
There wasn’t a question that’s what you did. I didn’t realize that that was a philosophy. So I guess it was how my father treated people I believe you need to treat everyone with respect.
Who was your mentor?
My cousin. He was eight years my senior. When I went back to the family business, he was there, and he really told me what was important and taught me, basically, how I could be significant. And worthwhile maybe that’s a better thing, how I could be worthwhile.
I always thought about agriculture, initially because it was such a humane thing to do. To be able to produce food that was impressive to me. You’re taught all kinds of things [in college], like what does Vitamin E do, and you have tables telling you how much you need in any specific diet and all these kind of things, but I didn’t know how really to apply that and get it out on that farm. And that is what he taught me.
And really taught me that a small company could compete against giants. And that was a change in my way of thinking.
Board Chairman Ray J. Hillenbrand says, “Rolf brings world-class executive perspective in the health care industry and good knowledge of the death care industry, as well as a thorough understanding of, and past success in, the CEO’s role and what it must accomplish.”
Classon is former president of Bayer Diagnostic, a division of Bayer HealthCare. Last year, he concluded his tenure as chairman of the executive committee of Bayer HealthCare.
“I am honored that the Hillenbrand Industries board would ask me to assume this role, although it is on an interim basis,” he says. “We must be clear on our corporate objectives before we hand the office over to a new chief executive. My role is to work with management and the board to achieve that clarity, and to work with the nominating/corporate governance committee to find a permanent CEO.”
Classon begins an immediate assessment of the strategic business plans for both Hill-Rom and Batesville Casket, the company’s two main divisions.
“I strongly believe that Rolf can provide the insight and leadership to assist the company and its management team to achieve the goals that our shareholders, customers and employees expect,” Hillenbrand says.
OPUS NORTH CORP.
Opus North Corp. named Joseph P. Williams real estate manager for its Columbus office. Williams focuses on expanding Opus’ presence in industrial and office in Central Ohio, and on exploring opportunities in residential, retail and mixed-use development. He has worked as director of real estate for Campus Partners (the real estate redevelopment arm of The Ohio State University), a commercial broker for both Equity & RGI Real Estate and, most recently, as director of acquisitions for National Church Residences.
Williams holds a bachelor’s degree from The Ohio State University in real estate and urban analysis, and is a licensed real estate broker in Ohio.
SUMMIT REALTY GROUP
Summit Realty Group, an Alliance member of Cushman & Wakefield, named Peter W. Quinn IV, SIOR, senior managing director of industrial business development and operations. This newly created position addresses critical strategic needs for extensive business development and recruitment of top talent in the industrial sector of commercial real estate. Quinn’s role also includes global supply chain solutions responsibilities.
Quinn was a co-founder of Summit Realty Group and remains a principal with the firm. He maintains his office at Summit’s Indianapolis offices at Bank One Tower and continues to be a vital resource for Summit’s Industrial Brokerage team.
Pamela Day joined Equicor Cos., as director of development and construction services.
Day has 10 years of experience in development, construction and real estate maintenance in the Southern and Midwest regions of Indiana. She obtained a wide array of success in the construction market due to her professional management skills on projects ranging in value from $1 million to $100 million.
Prior to joining Equicor, she worked at Fenley Real
Estate, a premier Class A office developer with more than 1 million square feet of real estate in Louisville, Ky. At Fenley, she worked as a construction manager for both the development and construction divisions.
Day is a Purdue University graduate with a bachelor of science degree in construction management.
Conseco named Todd S. Coombes vice president and IT service delivery officer. Coombes is responsible for developing and implementing standards for software architecture, software development and IT risk management.
Before Conseco, Coombes served as president and CEO for Health Care Systems Corp., a long-term care software solutions provider. Before that, he held several leadership positions at Professional Data Management Inc., an administration software solutions provider for the life and health insurance industry.
Coombes holds a bachelor’s degree in information systems management from the University of San Francisco and is a Fellow of the Life Management Institute.
Conseco also named Susan L. Menzel executive vice president, human resources, and promoted Grace M. Brothers to vice president, benefits and human resources controller.
PPOM, the Midwest’s largest independent preferred provider organization, promoted Kelley Monterusso to vice president of regional operations. Her responsibilities include client sales and service, and network development for Greater Michigan and Indiana and Ohio.
Monterusso’s most recent position with PPOM was regional director, leading the teams in the company’s Grand Rapids and Traverse City offices responsible for client, payor and provider relations throughout Greater Michigan. Monterusso is a board member of the West Michigan Association of Health Underwriters and a member of the Southwest Michigan Association of Health Underwriters, the Northern Michigan Association of Health Underwriters and the Self Insurance Institute of America.
In addition, PPOM promoted David Brown to director of regional provider relations.
As U.S.-based corporations consider cost-effective ways to streamline production and distribute products, many extend their facility search beyond U.S. borders. This trend is especially evident in manufacturing industries, where companies are scattering their plants throughout in Asia and Europe.
But border crossing presents challenges for novices to long-distance real estate. A company based in California might struggle to appropriately market a property it wants to sell in Great Britain. And contractual norms differ, as well. For example, in some European countries, a building and the land underneath are is not necessarily a package deal. The land might fall under a 99-year lease an entirely separate purchase from the structure that sits on the soil.
These nuances can break a deal, and so can inappropriate marketing tactics, poor pricing and ignorance of government regulations. Long-distance real estate requires a single point person who can make local connections, no matter the country.
Besides, without one point person or one U.S.-based brokerage firm to manage international brokerage deals, you have no idea who you are working with in terms of quality and service delivery.
Companies that trust one international real estate brokerage firm to manage their assets can buy and sell properties more efficiently. The consistency inherent through one point of contact translates into time savings.
When choosing a single broker, look for international experience and knowledge of foreign marketing strategies, the type and quality of prospect contacts, the sales process, and closing and legal issues. A U.S.-based real estate firm that has access to a network of local brokers worldwide will understand how a particular country’s culture, negotiations, regulations and even exchange rate can impact a deal.
Companies without experience in international real estate might overlook the complexity of a deal. Or, they might not understand the time involved in marketing transactions, the variable equity or how a specific country’s marketing efforts will affect the outcome of the process. There are also zoning regulations that could differ from country to country.
It’s important to have local knowledge and relationships. What is acceptable in the United States might not be even close to acceptable in another market. For example, in some situations, a corporate seller might expect a counteroffer, so you start with higher price, expecting to meet a middle ground.
In another country, the seller might not believe in that philosophy and, instead have a take it or leave it attitude. You must figure out the amount of room for negotiation, and often, that is a cultural difference that is best navigated by partnering with a broker based in that country.
Real-estate brokers can counsel clients on how business is conducted in different countries and access professionals around the world who specialize in various real estate transactions.
Before conducting any type of business overseas including real estate deals U.S. companies must understand the existing market conditions for a specific country or region. They must also consider the
time imbalance and its effect on scheduling. A representative in Asia works 12 to 14 hours ahead of a CEO in the United States.
Government regulations can add to the complexity of an international real estate deal. For example, lease terms are 25 to 30 years in Europe, while they are 10 to 15 years in the United States.
By using one source to manage global assets, you can streamline the process and add shareholder value by ensuring that you get the best market deal. Today, manufacturing companies must have global access and an understanding of the culture, regulations and real estate selling process in various countries.
JIM FASONE is principal of Summit Reality Group, a division of the Cushman & Wakefield Alliance based in Indianapolis. Reach him at (317) 713-2100
Roche Diagnostics appointed Tiffany P. Olson as head of North America for Roche Diagnostics, and president and CEO of Roche Diagnostics Corp.
Previously, Olson was responsible for leading global market development for the Roche Diagnostics Division of Basel, Switzerland. Her prior responsibilities at Roche Diagnostics include vice president of molecular diagnostics, with responsibilities for sales, marketing and support for Roche's molecular diagnostics products in the United States. She also was vice president of corporate accounts, and business development manager for Roche Diagnostics Corp. of Indianapolis.
"I am honored to accept this leadership role for Roche Diagnostics. I am looking forward to working with the people in the North American region, who I believe are the best and brightest in the diagnostics industry," says Olson. "We have many possibilities to explore, and we will continue our mission of innovating health information, which will result in transforming the way people are diagnosed and treated."
Prior to joining Roche in 1997, Olson was the owner of Resource Consulting Services, a health care market research and new venture project management business. She spent a number of years in leading positions with other health care providers.
Olson earned her bachelor of science degree from the University of Minnesota and an MBA from St. Thomas University, St. Paul, Minn.
INDIANAPOLIS SYMPHONY ORCHESTRA
The Indianapolis Symphony Orchestra's board of directors elected Sen. Evan Bayh, Indianapolis Mayor Bart Peterson and long-time Indianapolis Symphony Orchestra supporter Michael B. Maurer, former president and CEO of Wrecks Inc., as new members of the orchestra's board of trustees. Also, Sen. Richard Lugar was re-elected to serve as a member of the board of trustees.
DELTA FAUCET CO.
Vasken Altounian rejoined Delta Faucet Co.'s U.S. operations as executive vice president of sales and marketing. Previously, Altounian was president of Delta Faucet Canada.
In his new position, Altounian directs and manages all top-level sales and marketing strategies for Delta Faucet Co. and its stable of brands, including Peerless, Delta and Brizo. He oversees sales, brand marketing, advertising, marketing research, event marketing, Internet marketing, product management and new product development. Altounian also drives strategic process development.
THE COLLEGE NETWORK
Mike Capetanakis joined The College Network as vice president of marketing strategy and development. Capetanakis is responsible for all direct marketing for The College Network's businesses.
In 1998, Capetanakis led a management buyout of Compton's Encyclopedia from The Learning Co. He was president and publisher of Compton's for five years before selling the company to Encyclopaedia Britannica.
Prior to joining The College Network, Capetanakis held senior positions with The Tribune Co., Encyclopaedia Britannica and Grolier. He holds a master's degree and bachelor's degree from Long Island University.
Conseco Inc. promoted Mark E. Alberts to senior vice president, corporate actuarial. Alberts is responsible for corporate oversight of Conseco's actuarial operations, as well as the preparation and consolidation of actuarial data for regulatory filings, rating agencies and external auditors.
Also, Conseco Insurance, part of Conseco Inc., promoted Barry L. Staldine to vice president, information technology, and David J. Barra to chief financial officer.
Kelly Snider joined eGIX Inc. as a project manager. Snider reviews new orders with customers, maintains relationships with vendors and tracks orders. She has six years of technical experience and is a graduate of Indiana University - Bloomington.
INTERNATIONAL BUSINESS SOLUTIONS ALLIANCE LLC
International Business Solutions Alliance LLC (IBSA), made key changes to its operations and management structure in response to its continued rapid growth and expansion.
Mark McKinney, former executive vice president, became CEO, with overall responsibility for assuring strategies and resources are in place for immediate and long-term growth of IBSA.
John Heybach, former vice president of national account sales, is now chief operating officer, with responsibility for day-to-day operations.
IBSA also relocated its headquarters from Bowling Green, Ky. to Indianapolis to provide a more central national location.
"These changes are a strategic response to our increased growth and will better position us to meet the needs of our growing national customer base and better serve our affiliates and suppliers," says McKinney.
"This shift also helps us build on our recent implementation of a regional management system to serve key national account clients. These are very exciting times for IBSA, and we are looking forward to continued success," says Heybach.
The company is not family owned, but it has been run by a family member since McKinney's grandfather, E. Kirk McKinney Sr., got involved in the bank -- then known as First Federal Loan and Savings Association of Indianapolis -- in 1934, nearly 20 years after it was founded.
"My family is a minority stockholder," McKinney says. "Eighty percent of the company is owned by the stockholders. I work for the shareholders."
McKinney's father, Robert H. McKinney, had led the company since 1986, and Marni McKinney grew up hearing stories about how the early days of the bank.
"My father says my grandfather wanted to help people retain their homes during the Depression," she says. "People would come over at dinner time in anguish over losing their homes. My grandfather felt this would be a way to help the community."
Continuing that tradition, McKinney's father found other ways to help the community. Robert H. McKinney was a founding partner of law firm Bose McKinney and Evans LLP, but the bank and its ability to foster the building of homes and commercial properties was " ... always near and dear to his heart," says McKinney.
It is this same community-mindedness that today motivates the third-generation McKinney.
"As a child, it was very clear to me that what drove my father was to serve the community," she says. "And that's what drives me."
McKinney is hardly new to her leadership role. She was named vice chairman of the board in 1994, CEO in 2000 and served as CEO of Somerset Financial Services, a subsidiary of First Indiana Bank Corp. from 1992 to 2000.
"The transition to chairman has been occurring as my tenure grew," McKinney says. "I've been working with the board since 2000 developing a good relationship. This is a logical extension of my past duties."
But that doesn't mean she isn't realistic about the challenges she faces.
"We are fortunate to have Bob Warrington as president and CEO of First Indiana Bank," a subsidiary of First Indiana Bank Corp., says McKinney. "He is very talented, and we both see significant opportunity here. Our greatest challenge is also the key to our growth: the ability to attract and retain talented associates."
McKinney says First Indiana's reputation for delivering high-quality service is attracting that talent.
"Our clients want to sit at the table with the decision-makers," she says. "We are more responsive and better able to do that with a talented team of associates."
McKinney says First Indiana works to retain those associates by giving them opportunities and rewards. It's all part of her strategy to strengthen First Indiana, the largest locally owned bank headquartered in Indianapolis with nearly 600 employees.
"Really strong achievers are attracted to the bank, and those who are able to perform get recognition for that performance," she says.
That McKinney drive to contribute to the community is still strong, not just in the person of Marni McKinney but also in the company's core values. In fact, McKinney says, although she and her father have personality differences, their management styles are similar and based on those shared core values.
"Our core values are based on those set by my grandfather and father," McKinney says. "Our associates know our core values are honesty, fairness and doing what's right for the client. That won't change."
For McKinney, living by those core values means spending a lot of time with First Indiana clients and being personally involved. And it is this personal touch that she feels is a differentiator for the company.
"We are out most of our week because our focus is getting out and meeting with clients," says McKinney. "We are very responsive for a bank our size. We have the same products and services as other banks but we are more responsive. I spend more time calling on clients than my father did."
And getting to know clients is her favorite part of the job.
"Business owners deserve a very high level of service," she says. "They want us to be responsive, creative and flexible. I call up prospective and current clients and learn about the businesses of both. What I love the most is the opportunity to go see what they do and listen to what their opportunities and challenges are. That's what makes a business special. I can see the entrepreneurial spirit and that is fun for me."
Besides learning about clients' businesses, these visits also give McKinney the opportunity to see how First Indiana Bank can help them succeed.
"It is important for the client to have a large degree of trust with us," McKinney says. "That trust is a great investment for the future. Like attorneys, banks can work with a business to provide them with financial advice. It's important for the client to trust you if you want them to look at you for further service."
McKinney's passion for the client inspires employees, which is all part of her strategy for the bank's success.
"Setting an example, being consistent with our message and having a real passion for our vision is how we get employee buy-in," she says. "We have endeavored to be clear about our vision and our commitment to our associates, our shareholders and our clients."
And McKinney says she lives by the old adage that actions speak louder than words.
"The leadership here demonstrates their commitment through their actions," she says, "by discovering the needs of our clients and delivering the product to meet them. Top management will meet with a client at a moment's notice, whenever a client calls."
McKinney says the company has made some difficult choices in the past year, all designed to give the bank a clearer focus on its goals and core values.
"Central Indiana is a market filled with opportunity, and we are excited to be here," McKinney says. "We made some tough decisions in 2004 so we could position ourselves in 2005 to be focused on that market."
Those decisions included selling the company's out-of-state construction lending offices, as well as Somerset Financial Services; part of the reason for relinquishing Somerset was complying with Sarbanes-Oxley.
"Sarbanes-Oxley made it difficult for us to have any synergies with Somerset, so we sold the company back to the employees," McKinney says.
The decisions were tough because they meant losing 75 valued employees -- 35 of them to the closing of the construction lending offices -- but the end result was positive.
"We are focused on being more efficient," McKinney says. "Now our operating costs are more appropriate for our size and we have a more prudent risk profile. We are focused on growing our balance sheet."
McKinney is not the only one excited about First Indiana's new focus.
"The associates are excited about delivering our message to clients," she says.
There are several goals for this new focus -- sustaining executional excellence, emphasizing revenue growth and creating the best opportunities for shareholders, says McKinney.
"We want to make it easier for our customers to do business with us through improving our operations and managing technology," she says. "And we want to experience revenue growth through growing our deposits and managing our assets."
Part of that plan includes capitalizing on First Indiana as a local player.
"Customers want to walk into the branches, and the associates there know them by name," she says. "We are training our associates to work up and provide a profile of clients and the best financial advice we can give."
Years from now, when McKinney passes on the leadership role to a new chairman, she hopes she will have achieved a legacy similar to that of her father and grandfather.
"My hope is that First Indiana is an exceedingly high-performing bank, a great value for shareholders and renown fo r its commitment to the customer and the community," she says. "I will work hard to make our shareholders and clients strong and pleased, and our associates fulfilled."
How to reach: First Indiana Bank Corp., (317) 269-1200 or www.firstindiana.com
As president of The Precedent Cos., Peterson's first task was to combine disparate companies into one. The Precedent group of companies focuses on commercial and residential development, construction and financial services. When Peterson assumed the reins of this group, each operated very differently, with its own management structure.
"A person working for one company wouldn't know the person leading another," Peterson says.
His challenge was to reorganize the companies under one leadership umbrella, then get them to work together toward common goals.
As mayor, Peterson's taken this same approach to unify the departments in his office. He says it is important that members of each department know and understand Peterson's overall goals. Communication is the key to accomplishing this objective, he says, so he holds a bimonthly cabinet meeting to keep senior leaders on target.
The structure of Peterson's organization also lends itself to a stronger communication flow. He says his "pyramid communication" structure optimizes the flow of information among him, his staff and key policy makers.
Tying everyone together is the Peterson plan. Much like the business plan of a large company, the Peterson plan defines the mayor's goals and objectives and outlines how he plans to achieve them. It has also helped Peterson weather what he calls some pretty big waves in the political ocean, such as the city's $600 million purchase of the Indianapolis Water Co.
"The plan always keeps us anchored," he says.
Smart Business talked with Peterson about the business of running a city and how he stays focused on his plan.
What are the similarities between running a business and running the city?
Executive leadership is executive leadership, whether you are running a private company, a not-for-profit organization or are a government leader. It is different from being a legislator, but there are a lot of parallels between leading a business and the city.
The reality is that leadership is leadership, and the most important thing is to surround yourself with the best people you can. The team will make or break you and the progress of the organization.
There is a more overt political element to being mayor, but there are also some political elements to leading a business. The best organizations are not ones led by an unquestioned dictator. You need to persuade people, to get them to take ownership of their part of the business and effectively delegate. You keep a close eye on what you delegate.
You build coalitions in government that are not dissimilar to the coalitions made in business. There is no question that my experience in business was a huge advantage to me in taking on the job of mayor five-and-a-half-years ago and continues to be a great benefit to me.
What was the most important lesson you learned during your four years as president of The Precedent Cos.?
Hiring the best people you can find and then ensuring that they are constantly focused and being challenged and fulfilled by their jobs. You need to make sure you have the right people in the right place and that they are enthusiastic and passionate about their jobs.
Sometimes that means moving people around and giving them additional responsibilities. You need to allow people to reach their potential and follow their passions within the goals of the organization. That's how you make progress -- you have strong people.
If you have weak people, you have to make a change or you will suffer. That is probably the most important thing that I brought into the public sector from the private sector.
What was your biggest challenge at The Precedent Cos. and how does it compare to the challenges you face as mayor?
Clearly, the biggest challenge I had in the private sector was to create one company; to bring disparate companies together as one. There were a number of businesses with different ownership and management structures. My challenge was in bringing all that together and creating one holding company, one board and ownership structure, and I was successful in achieving that.
In government, the basic structure is a given. It is set by law, but within that, people need to work together toward the same goals or they could end up almost working against each other.
I need to make sure that people are working toward shared goals. They need to start off on the same page. They could fall off quickly if you don't focus on the importance of keeping people together. Everyone knows their goals, and they are constantly updated. We function as one office rather than a confederation of departments.
One thing we do have is a cabinet meeting every two weeks where we are all in one room. We talk about what we are doing and what we have coming up, and I provide support and remind them of any overriding messages. This helps keep everyone on the same page.
One technique to keep everyone working together is the structure we have -- a loose reporting structure. I have a senior person in each department reporting to me and more deputy mayors responsible for certain issue areas. It is not a rigid hierarchal structure but a pyramid for communication.
There are about 25 to 30 key policymakers. By setting up the pyramid communication structure, I know what's going on in all the divisions and they know what I'm up to.
How is the Peterson Plan similar to a business plan for a company?
It is similar in many ways, although a business plan typically includes pro forma financial performance information. You typically include profitability information in addition to strategy, goals and objectives.
In this case, the goal is not growth or profit. The Peterson Plan focuses far less on those types of issues but everything else, plans, tactics for implementing and achieving our goals, is included. The difference is we don't have financial data. If there is additional revenue needed for a particular plan, then that is spelled out, but there isn't a huge financial component.
What strategies have you used to implement the plan and how has it been received?
The plan has been well-received . The first time it was a huge component of the campaign. My staff is asked to keep the plan out as a reference tool. At any moment someone might ask what next, he or she can look at the plan and see. Based on my own experience, I can say it has helped us accomplish a lot. Being a newly elected person can be like going out in the Atlantic in a small sailboat. You get knocked about by some big waves and bad weather; there are a number of unpredictable things that happen. If you don't have a plan, when the bad storm is over, you won't know what way to turn.
It is the same with government. If you don't have navigational equipment, what you end up after four years accomplishing may be everyone else's agendas. We have reacted to some pretty big waves but we didn't lose sight of our goals.
There was a lot we did not see in the plan -- both opportunities and challenges. We responded to those but also kept the plan in mind. At the end of the four-year term, we published a report explaining what we accomplished and what we didn't.
One of the big waves we dealt with was our purchase of the Indianapolis Water Co. It was one of the largest public transactions in state history, using $600 million in bonds. The water company had been privately owned and we were fine with that. But the company was making a huge acquisition which fell under the jurisdiction of the SEC.
The SEC required the company to divest itself of the water company. We were not happy that it would most likely be sold to a company outside the state or even outside the country. We were able to invoke an obscure state low that allowed us to buy back the water company. It was a major undertaking and took a huge commitment of time and resources to accomplish. We now contract the operations of the water company to a private party. But that was not in the Peterson Plan.
Has the Peterson plan been an effective tool toward achieving the city's goals?
Yes. It provides a road map and navigational tools, and I am able to see and make sure that what I promised, I deliver. Now there are some items in the plan that, at the time ,we thought were important to do, but something in the equation changed and then it didn't make sense.
There were a few items in the plan that we decided would actually be bad to do, so we chose not to do those and explained why. The vast majority of our goals were accomplished, and some we tried and failed. But yes, it is an effective tool and should be used more often.
What do you consider the city's biggest strength?
Our biggest strength is clearly our culture. Not in the traditional sense, but the culture we have of commitment to the city above self-interest.
There are private-public partnerships now that didn't exist when I was born. People are working together to make the city a better place. This culture has developed over the last 30 to 35 years and it is a powerful asset. I'd argue that we have made more progress than any other established city in the last 35 years because of that asset.
What about areas for improvement?
We could do a better job painting a picture of the city. We need to do a better job getting the word out about the remarkable city this has become.
We are working with both private and not-for-profit marketing groups to do this, to better depict the arts and cultural assets that we have. Our goal is to become an arts and cultural destination.
How to reach: Mayor Bart Peterson, (317) 327-3601 or www.indygov.org/eGov/Mayor/home.htm
Education: Bachelor's degree, College of William and Mary, Williamsburg, Va.; master's degree, hospital administration, Duke University, Durham, N.C.
First job: 1965, administrative assistant, Duke University Medical Center
Career moves: Associate hospital director at the Albert B. Chandler Medical Center, University of Kentucky, 1971-1975; named hospital director, Milton S. Hershey Medical Center, Hershey, Pa., 1975; hired as president and CEO of Akron (Ohio) General Medical Center, 1978; became president and CEO of Community Health Network, 1984
Boards: Member, VHA National, Indianapolis Chamber of Commerce, Indiana Pro Health Network, The Health Care Group; co-chairs Groups for Renewal, Accountability and Development of Excellence in Schools (GRADES); 1998 president of the Indy 500 and 400 festivals.
What is your greatest challenge in business and how did you overcome it?
It was when I found myself on the other side of a major issue with my board chairman. I handled it by developing even stronger relationships with each individual board member.
Past or present, whom do you admire most in business and why?
My mentor was Ray Brown [who played a major role in shaping health care administration training], and my admiration for him is that he changed my management philosophy from one of basically leadership through personal relationships or personal friendships to one of intellectual-personal management philosophy.
What is the greatest lesson you've learned in business?
There are many lessons, but I would say that the greatest lesson learned in business is how important passion is in achieving your goals.
These descriptions convey the disdain many feel when paying insurance premiums. However, the most common financial transfer mechanism is an insurance transfer. Insurance allows an organization to transfer the financial consequences of a loss, especially a catastrophic loss, to an insurance carrier. The carrier pays policyholders for losses and, in turn, distributes the cost of all losses among policyholders.
The insurance policy is an agreement in which the insurance carrier promises to pay claims in exchange for premiums paid by the policyholder. Ultimately, it's a legal contract between two parties.
Components of a policy
The policy is constructed to outline the terms and conditions of the contract, including the obligations and rights of each party. This is true whether the policy is a package (usually covering property, general liability, auto, etc.) or monoline (workers' compensation/employers' liability, professional liability, etc.).
Whether package, monoline or a combination, an insurance program has three components -- common policy declarations, common policy conditions and coverage parts or lines of business.
Common policy declarations
The common policy declarations, or "dec" page, is often overlooked. However, it can make or break an insurance claim. In addition to the premium, the dec page provides critical information.
* Named insured and insurance company. The parties entering into the contract.
* Agent or broker. The "producer" who brought the two parties together and facilitated the execution of the contract.
* Effective date and expiration of the policy. Defined dates on which coverage begins and expires. Subject to terms and conditions of the policy, coverage will be determined based on the timing of the occurrence relative to the policy term.
Common policy conditions -- read them
The standard insurance policy extends specific rights and duties to the named insured. These conditions establish fundamental ground rules for both parties of the contract -- policyholder or named insured, and carrier.
Many of these conditions are contained in a common document that applies to all coverage parts. In addition to the underlying right to coverage (including indemnity and defense), the named insured's traditional rights include the right to cancel the policy, the right to receive cancellation or nonrenewal notification from the carrier, the right to change the policy and the right to receive return premium.
Basic duties of the named insured include paying premium and submitting to examination of books and records and/or inspections and surveys (at the request of the carrier).
Who's on first?
Often, an insurance policy will contain more than one named insured. The common policy conditions make it very clear that the rights and duties pertain to the first named insured -- literally, the first name listed in the declarations.
It is important to consider whether the first name is appropriate for a given right or duty. Also, note that the insured cannot transfer the rights or duties under the policy to any other person or organization without the written consent of the carrier.
Additional insurance policy components
Each coverage segment includes its own set of forms that allow you and your insurance agent to construct the desired policy terms and conditions. These forms define key terms and conditions, including the insuring agreement, causes of loss, exclusions, definitions and specific line of business conditions.
Besides clearly establishing terms and conditions, policies are constructed to allow for clear delineation of coverage between the various lines of business. For example, coverage may be excluded in one form because it is provided elsewhere.
Insurance should never be viewed as a substitute for loss control or the sole means of risk management, but as a critical element. Your insurance agent is there to help you interpret the legal contract that is your insurance policy.
Protect yourself by making sure you understand that contract and how it applies to your business.
Steve Blankenship, manager, underwriting practices group at Westfield Insurance, can be reached at (330) 887-8417 or firstname.lastname@example.org. In business for more than 156 years, Westfield Insurance provides commercial and personal insurance services to customers in 17 states. Represented by leading independent insurance agencies, the product it offers is peace of mind. For more information, visit www.westfieldinsurance.com.