Friday, 26 December 2008 19:00

Survival tactics

The true test of executive leadership is how well someone performs in the face of crisis. And if actions do truly define someone, then the current economic business climate is the ultimate proving ground for today’s leaders.

This month’s cover story subject, Ron Marhofer, owner of Ron Marhofer Auto Family, is no stranger to adapting to tough economic times. He bought a Hyundai franchise to add to his group of dealerships back in 1987, around the time of a previous stock market crash, and was forced to rethink the way he did business in order to make the acquisition successful.

Marhofer quickly realized he needed to develop a strong group of leaders to help him replicate the culture that had been successful when his operations were smaller. And then, he had to develop ways to communicate one consistent message to everyone.

Those tactics are just as critical now during today’s new economic realities.

Back in October, we asked our readers about the tactics they use to lead their organizations through trying times, and the response was overwhelming. So starting with this edition of Smart Business, we’re launching a monthly feature called Survival Tactics, which will be dedicated to examining and sharing what regional executives are doing. And, we’ll be focused on the positives rather than the negatives. Over the next 12 months, we plan to tackle topics such as how to get everyone to focus on his or her job and avoid being distracted by the plummeting stock market, how to find ways to drum up new business when budgets are so tight, and what simple things CEOs can do to inspire confidence in their employees that the sky is not falling.

This month’s main feature offers tips from Zircoa Inc.’s John Kaniuk, whose tactic is to continually keep his 150 employees aware of how the economy is affecting the $30 million manufacturing firm.

“Even if I don’t have the answer, at least I’m discussing it with them,” he says.

We also spoke with Gateway Title’s Rachel Torchia about how she’s thriving in the midst of a brutal housing market.

Hopefully, your organization has its own survival tactics, which we’d like to hear about. Send us an e-mail and let us know what you’re doing, and we will try to include it in an upcoming feature.

Contact Editor Dustin Klein at

Published in Akron/Canton
Tuesday, 25 November 2008 19:00

Proper alignment

When you’re worried about whether your customers will be in business next month and you’re hustling to maintain steady enough cash flow to meet your company’s next payroll, giving back to the community probably isn’t top of mind.

So what effect will this current economic crisis have on charitable giving in 2009 and beyond?

A recent survey by the online e-commerce company PayPal indicates the future might not be as bleak as it seems.

PayPal’s 2008 Holiday Survey reported that 10 percent of 1,000 respondents planned to give more money to charity this year than they did in 2007. Even more encouraging was that 71 percent said they planned to give at least the same amount as they did last year.

This month, we recognize an impressive group of honorees through the 2008 Medical Mutual Pillar Award for Community Service program. A common trend emerged from these organizations that might provide a road map to where community service is headed and also illustrate how businesses and nonprofits can better approach corporate philanthropy: change.

Simply put, the era of a scattergun approach to corporate giving is over.

It’s true that some large companies continue to give to dozens of organizations, but small and midsize companies dominate today’s corporate landscape, and they employ a more focused approach with their philanthropy.

These businesses tend to align themselves with nonprofits whose missions satisfy one of three objectives: They match corporate goals, match employee interests or fulfill a deep-held conviction of the company’s owner or top executive.

This isn’t a new concept, but this year’s crop of nominees indicates a significant change in corporate philanthropy in that the practice is nearly universal.

Times are changing, and those nonprofit leaders who can read the tea leaves accurately and adjust their fund-raising appropriately should do just fine.

There’s no doubt that the next few years will be challenging. Survival on all fronts — for businesses and nonprofits, alike — will require a combination of working harder and smarter than in days past. But done properly, corporate philanthropy has a bright future. Thriving businesses require strong, vibrant communities to support them. One simply can’t exist without the other.

Contact Editor Dustin Klein at

Published in Akron/Canton
Thursday, 25 September 2008 20:00

No fun in the sun

When I was a junior in college, two fraternity brothers and I embarked on a Florida spring break vacation in search of the elusive “spring break experience” we had seen in the movies.

Needless to say, we never found it. And beyond remembering that I actually went on this vacation, there wasn’t anything memorable about the trip.

That’s partially because our game plan was pretty bare bones — we booked a hotel, packed our bags, jumped into my car and drove to Florida with no idea about what we would do once we reached our destination. We had, to be blunt, failed miserably to plan ahead.

You can never say too much about the value of planning.

Without it, your business is nothing more than a rudderless ship afloat in a vast ocean. You, as its leader, aren’t much better off because you don’t know which way to point the ship.

With planning, it’s a different story. Suddenly, you’re armed with a map that will lead you on a targeted quest toward a stated goal.

This month’s cover story on John Stropki, chairman, president and CEO of venerable Cleveland manufacturer Lincoln Electric, goes straight to that point.

Stropki, who led Lincoln Electric to more than $1 billion in revenue growth over the past three years, claims the key to effective planning is balancing long-term goals with short-term objectives.

“It’s a compromise,” he says.

Part of that compromise is soliciting input from your employees and developing strong channels of internal communication that allow you to fine-tune and focus the plan.

Communication is also the mantra of this month’s Smart Leaders subject, McDonald Hopkins’ Carl Grassi. Grassi assumed the leadership role of the 250-employee law firm after the untimely death of his predecessor, Joseph LoPresti, and his first task was getting the organization past the mourning and back to business.

“Face-to-face communication is still the most effective way to have people relate,” Grassi says. “You cannot replace the benefits of it.”

When you effectively communicate within your organization, you’re well on your way to understanding how to develop and execute a plan that will take you from where you are today to where you want to be tomorrow.

As for my vacation, had we developed a plan for the trip, maybe I’d have a college spring break vacation actually worth spinning stories about.

Contact Editor Dustin Klein at

Published in Cleveland
Tuesday, 26 August 2008 20:00

Secret service agents

Creating a world-class customer experience is about creating “secret service” systems that allow front-line employees to engage and interact with customers to personalize the experience by anticipating and delivering on their needs.

So the next time you hear somebody use the words secret service, don’t assume their talking about the government agents.

Out of curiosity, I looked up the definition of the government’s Secret Service.

Secret Service: Governmental service of a secret nature charged chiefly with the protection of the president, responsible for the collection, analysis and appropriate dissemination of intelligence.

Think that has nothing to with secret service as it relates to customer service? Actually, by substituting just three words, it fits perfectly.

Secret Service: Customer service of a secret nature charged chiefly with the protection of the brand, responsible for the collection, analysis, and appropriate dissemination of customer intelligence.

Customer intelligence is customer data (i.e., buying habits, personal preferences, where they live, etc.) that fuels secret service.

Many companies let this happen by chance. Typically, a few long-term employees create relationships with regular customers to get this, but you have a high degree of inconsistency when it is contingent on that. The best customer service companies train all their employees how to collect and use customer intelligence. A good system with the proper training allows even the newest employees to personally engage and recognize even those less frequent customers.

Secret service lawyers

Connecticut’s Carter Mario Injury Lawyers has grown consistently during the past five years, going from $2.5 million in revenue in 2002 to more than $8 million in 2007. Back in 2002, however, the law firm was stagnant largely due to low service aptitude. That is when Carter Mario, president and CEO, decided to buy out his partners.

“Our service culture had to change in order for us to differentiate from the rest of the pack and to survive,” Mario says. “We adopted a service culture that has enabled us to become one of the fastest-growing law firms in the state.”

One of the single biggest complaints in the legal industry from clients is poor communication between clients and lawyers.

“We made this the No. 1 priority in our office: client contact,” Mario says. “We guarantee we will return the client’s call the same day or lunch is on us. It is a nonnegotiable part of everyone’s job here.”

The management team at Carter Mario instituted a procedure for capturing information about each client in a format that allows everyone access. They were able to customize the software they use by adding a “secret service tab.” This tab contains vital customer intelligence, such as preferred refreshment, client’s eye color, birth date, spouse’s name, children’s ages, hobbies and even the client’s pet’s name.

They use it to execute what Carter Mario calls “drive-bys,” where a staff member makes a seemingly spontaneous visit with a client who is in the office just to say hello and say something personal.

“We have continuously received great responses from our clients, and a collateral benefit has been that our staff members doing the drive-bys really enjoy the responses they’ve received, and it pumps them up,” Mario says.

Altruistic secret service

My favorite secret service is when the customer service that is provided has no apparent hidden agenda. For example, my accountant dropped off an autographed picture of Notre Dame football legend Rudy Ruettiger personalized to my oldest son Johnni. I don’t recall telling him, but somehow he remembered that was my son’s nickname when he played youth football.

Secret service creates an emotional bond between customer and company that transcends the product or service. That feeling becomes sought after again and again.

Think what would make you stand out a little differently. When every other business is making pitches, asking for orders and never finding out what is important to a CEO, imagine what it would mean if you simply sent a gift that has nothing to do with what you do, or can do, for his or her business but demonstrates that you have genuine concern for the person and his or her business goals.

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret,” the No. 1 business book for the month of June on He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at

Published in Cleveland
Tuesday, 26 August 2008 20:00

Eyes wide open

The term “innovation” is tossed around so often that it’s begun to lose its luster.

The truth is that no organization can survive in today’s economy without being innovative in some way. If you can’t differentiate your company from the competition, you won’t just lose the current battle for customers, sales and profits; you’ll probably lose the entire war.

In a lot of ways, driving innovation within an organization is similar to the art of writing. You can’t force it or you get a litany of poorly thought out nonsense. Innovative ideas, like the perfect turn of phrase, occur after deep thought, sound reflection and asking “what if” questions.

Ellis Yan, one of this month’s cover story subjects and founder of TCP Inc., sums up innovation when he says, “Just pay attention.”

TCP is on the cutting edge because Yan keeps his eyes wide open to see what’s happening around him then invests ample time to consider how what he finds might be applied to his business.

Invacare Corp.’s longtime CEO A. Malachi Mixon, also featured this month, offers a different take. One way he innovates is by seeking out disruptive ideas that completely change the way people live and work.

Later this month, Mixon and Yan will join David Strand, chief operating officer and chief emerging businesses officer of The Cleveland Clinic, and Bharat Desai, founder, president and CEO of Detroit-based IT firm Syntel Inc., for a panel discussion at Smart Business’ annual Innovation in Business Conference.

This year marks the 10th anniversary of the conference as well as our 10th year working with Anthem Blue Cross and Blue Shield of Ohio as the program’s title sponsor.

Our 2008 theme is doing business in the global economy, and the panelists will discuss how their respective organizations use innovation to succeed on the world stage. Additionally, we’ll honor 10 Northeast Ohio organizations and their leaders for their commitment to innovative management techniques and developing cutting-edge products and services.

All 14 of these leaders and their organizations are profiled in a special pull-out section in this month’s edition. As you read their stories and reflect on their ideas with your own eyes wide open, you should start to notice the sheen reappearing on the idea of innovation. And odds are, that sheen will be gleaming even brighter than before.

Contact Editor Dustin Klein at

Published in Akron/Canton
Saturday, 26 July 2008 20:00

What goes around comes around

When I was about 14 years old, I asked my paternal grandfather what it took to be good at his profession, law. At the time, I thought I might want to be a lawyer and who better to ask than my grandfather, who owned his own firm.

“Dusty,” he said, “work hard and treat people the way you want to be treated. Be honest with everyone you deal with and, more important, be fair. If you do that, you’ll do well.”

My grandfather died 19 years ago, when I was 20 years old, so he never saw me grasp the meaning of his words when I became an adult. And I never became a lawyer, choosing instead a career in my first love, journalism. But the true power of my grandfather’s advice comes back to me every once in awhile when I run into someone who remembers him. Unsolicited, their recollection of Austin is exactly the same: “Your grandfather was one of the most honest men I ever met. Even when he was on the other side, he was always fair.”

As we put this annual human resources issue of Smart Business to bed, my grandfather’s tenets of honesty, fairness and treating people well kept popping into my head.

The results of our eighth annual ERC/SBN Workplace Practices Survey are eye-opening but not necessarily surprising — the top issue facing CEOs in Northeast Ohio is the battle for talent.

It’s a battle won by building work-places where employees don’t just clock in and out. They take a true interest in the organizations they work for because the people who employ them take a genuine interest in them.

That is the theme of Assistant Editor Kristy O’Hara’s cover story on Olympic Steel CEO Michael Siegal. Siegal runs an organization that has been recognized numerous times as one of the region’s top places to work. By focusing on employees, Siegal has grown Olympic Steel to more than $1 billion in sales and record profits. “At the end of the day,” Siegal says, “all that matters is people.”

Our survey’s results, as my grandfather would attest to, don’t reveal anything magical about how to run your work-place and win the talent battle. It’s all just plain common sense. Organizations are at their best when they treat their people well. Believe it or not, it’s really as simple as that. <<

Contact Editor Dustin Klein at

Published in Akron/Canton
Friday, 25 April 2008 20:00

The 10 commandments

There are 10 principles that all world-class customer service organizations have in common. Those 10 commandments are listed below in the precise sequence necessary for any organization to provide a world-class customer experience.

Service vision

Every organization that provides superior service has a strong service vision that creates a clear direction for everyone inside it. This is the underlying purpose of what you bring to the community and why your customers buy from you rather than from a competitor.

You must develop the service vision before anything else can take shape. It drives hiring, standards, training and leadership philosophies.

World-class internal culture

With a vision in place, create a world-class internal culture that attracts, hires and retains only those people who are capable of upholding the service vision of your organization.

This culture serves as your organization’s foundation and allows our service vision to become a reality.

Nonnegotiable experiential standards

Any success in achieving your vision relies on a set of experiential standards that allow your service vision to be of real value to your customer.

You do this by having standards that everyone must follow for each stage of the organization’s customer experience cycle. The standards result in employees providing a consistent, engaging experience that is unlike most competitors.

Secret service systems

Once you are consistent, you need to find ways to gather and utilize customer intelligence to personalize experiences by engaging and anticipating customers’ needs.

This can be accomplished by developing secret service systems that capture information on the front end and turn it into easily accessible information that enables front-line employees to personalize every customer’s experience.


A service vision, standards and systems are worthless if you don’t have a way to ensure consistency.

Do so by creating a training program for all new and existing employees that consists of soft-skill training aimed at increasing service aptitude and providing team members with the knowledge and tools they need to deliver a world-class customer experience.

Implementation and execution

This is the area where most companies fail. Therefore, the implementation and accountability for the set standards and systems are every manager’s responsibility. Develop a process that allows the realistic implementation of your new customer service initiatives and systems.

Zero risk

Being able to anticipate your service defects and having protocols in place to make it right is the difference between good and great.

Every employee must understand the common service defects that can arise at each stage of the customer experience cycle and be trained and empowered to provide great service recovery. That way, when problems happen, your company is known to be zero risk to deal with.

Above-and-beyond culture

Create an awareness of the most common opportunities where employees can really deliver heroic service for the customer. Develop mechanisms to collect and redistribute above-and-beyond stories that constantly remind your employees of the power of your service vision. This can become a tremendous competitive advantage.

Measure your customer’s experience

Use a scientific method to measure your customer’s experience and satisfaction. It should provide benchmarks for performance in each department.

Your goals must be tied to a specific metric that allows you to measure how satisfied your customers are with you, whether you are keeping your service brand promise, how effective service recovery is and how well you stack up against the competition.

World-class leadership

World-class leadership starts at the top and provides the passion, inspiration and discipline necessary for all employees to deliver every day.

While this is the final commandment, it is the most important. It becomes the driving force behind being able to consistently deliver the other nine. <<

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret” (due out April 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at

Published in Cleveland
Wednesday, 26 March 2008 20:00

Ahead of the curve

When it comes to customer service, do you know the rating for your company?

Probably not, but that’s not surprising considering that most CEOs don’t know how to measure their customer-service-aptitude level (C-SAT) beyond anecdotal feedback. If you don’t know your C-SAT, it’s difficult to determine where your strengths lie and what opportunities exist to get your company’s customer service to the next level.

Listed below are the five levels of customer service. The defining characteristics of companies at each of these levels apply to all organizations, regardless of product or customer base.

Level 1 — Unacceptable

You are at the bottom of the customer-service curve. It is very difficult to do business with your organization. Your hours of operation are limited, policies are not consumer-friendly, and it is impossible to get a call returned. You probably don’t provide ample training to your team, and you are more worried about hiring bodies to fill your needs than concerning yourself with who are those people. The technical skills of your existing staff are limited to minimal product knowledge, and you compete by having the cheapest price or no competition. As a result, employee turnover is high at all levels.

Level 2 — Below average

Not surprisingly, your company is difficult to do business with. You may have stringent policies for things like returns or cancellations, and it is difficult to speak to a real person when someone contacts you. Training is limited to technical and operational activities. Turnover is high, only the owner or senior management has the authority to fix a problem, and management gets defensive with inconvenienced customers and little or no attempt is made to rectify the situation. As a result, your service is extremely inconsistent and totally dependent upon who is dealing with the customer.

Level 3 — Average

The good news is that your employees are technically proficient, your customer service is consistent, and you have flashes of above- and below-average service levels. Some employees will occasionally go above and beyond. However, training is often devoted to technical and product knowledge, and only managers have the authority to make things right for the customer.

Level 4 — Above average

Technically, your company is best in class. Employees perform some great acts but lack day-to-day consistency. Unlike lower levels, experiential training is provided, including soft skills, how to deal with customers and service recovery. Because of this, you are able to charge above-average prices. Internally, your company has a strong inspirational service vision, and above-and-beyond situations occur often. New employees receive solid training, and you have lower than normal industry turnover. All front-line employees have the authority to make the situation right for the customer.

Level 5 — World class

It is extremely easy to do business with your company. Policies are customer-friendly, and when they aren’t, front-line associates can override them. Technically, you are best of class. The full range of experiential training is provided; your employees are taught and tested on standards for every point of contact with the customer, including possible service defects and on how to identify above-and-beyond opportunities. In most cases, your company has certification training, which employees must pass in order to receive promotions.

Internally, you have a strong inspirational service vision, profile your customers and share guest information. Every department in your organization is aware that supporting each other affects the customer.

Great systems are designed and implemented. Customer-service training is constant. New employees receive solid training, and there is very little compromise when it comes to hiring only those who believe in delivering great customer service. There is a strong implementation process and follow-through on initiatives.

As result, you have low turnover, your company has a great corporate culture and a reputation for superior customer service. Typically, your prices are higher than the competition.

So how can you measure your company’s customer-service aptitude to determine where you fit along this curve? Drop me a line, and I’ll send you a link to a test you can take to let you know.

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret” (due out April 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at

Published in Cleveland
Thursday, 27 March 2008 20:00

Sticker shock

We are mired in a health care crisis.

On one side, you have a flawed system of primarily employer-provided health care insurance with rising premiums. Opposite that, you have calls for so-called universal health care, where state or federal governments foot the bills using taxpayer dollars or potentially issue mandates for private citizens to somehow pony up for coverage.

Unfortunately, neither the status quo nor universal health care is a solution to our woes.
By now, you’re probably feeling the impact of double-digit in­creases on your annual corporate renewal. And in an effort to keep the costs down, many of you shifted more costs to your employees either through a higher percentage of premium cost or high deduct­ibles they need to pay before actual coverage kicks in.

On the surface, this makes perfect sense. Asking employees to share in the cost should cause them to make better-informed decisions with re­gard to their personal health and health-care-related decisions.

Unfortunately, there is a problem with this that isn’t the employers’ faults.

The cost of living is increasing faster than the average company’s annual raise for nonmanagerial staff. And when you add in premium sharing, a high out-of-pocket deductible and even prescription drug costs, like it or not, your company’s value proposition for attracting and retaining top employees might not have the shine it used to when a competitor realizes that many of today’s college graduates — and certainly more seasoned talent — rank benefits as high as starting salary.

Don’t get me wrong, the alternate certainly isn’t any better.

Government-sponsored health care is not a panacea and hasn’t proven successful in other countries. Details for such a monumental industry shift are sketchy at best, and no one has been able to articulate how it would effectively work. How would we shift the financial burden away from private employers without a major disruption in ongoing health care treatment? And, who really is paying the bill?

A hard, long look at the problem by a coalition of business owners, insurance companies, government and employees would be a step toward developing a better solution. But unfortunately, that’s not going to happen until everyone wakes up and realizes we are headed for a disaster far worse than the current subprime mortgage mess. If not, the eddy we’re getting sucked in­to is going to get stronger. <<

Contact Editor Dustin Klein at

Published in Akron/Canton
Sunday, 24 February 2008 19:00

Apt to serve

What is the secret to how companies like Disney, Nordstrom and Ritz-Carlton get thousands of employees to consistently execute world-class customer service while most companies struggle with teams of 15 to 50 people?

The answer is simple — employees. You count on your team of people to deliver service, and often, there is a lack of service aptitude.

So what constitutes superior service? The answer depends on who you ask. Without proper soft-skill training, superior service is relative to one’s life experience. Where has he or she traveled? What has he or she experienced? What manners and code of behavior was this person taught at home?

Most likely, there will be a discrepancy between your vision of customer service and any new employee’s vision.

The good news is that service aptitude can be learned and improved.

At The DiJulius Group, we define service aptitude as “a person’s ability to recognize opportunities to exceed a customer’s expectations regardless of the circumstances.”

The key to that definition is the last four words — “regardless of the circumstances.” High service aptitude is not as critical on your slowest day of the week or on a day when everything is running smoothly, but true service aptitude is revealed in a difficult situation, such as when you are short-staffed or in a crisis or when service recovery is needed.

Think about it this way.

For months, you have been promising your spouse a getaway for just the two of you.

Finally, you are spending three days in the Bahamas. The two of you are sitting by the pool, ordering piƱa coladas and reading gossip tabloids. Life couldn’t be better.

Meanwhile, back at home, your company just dropped the ball on your platinum-VIP customer. The only person on the scene to handle the situation is your most recently hired employee.

Still having fun? Still relaxed? Unfortunately, the simple truth is that our most recently hired, least-trained and lowest-paid employee deals with our customers the most.

Although most people enter the business world with a very low service aptitude, it can increase dramatically with the proper training program in soft skills and with continuous training in customer service. However, most companies spend the vast majority of their training on the technical side of the job, usually because they are hiring reactively, filling an empty position with a warm body.

One of the best tools for measuring if an employee’s service aptitude is high enough to start interacting with a company’s customer is some sort of employee service aptitude test. We created our own called the E-SAT. It is composed of 50 to 75 multiple choice questions about the most common situations that may arise between the employee and their customer, ranging from non-negotiable standards, service recovery, and above and beyond opportunities to uncomfortable and awkward situations that he or she may encounter.

At our company, we administer the test before and after any new employee goes through his or her initial training. This way, it monitors how service aptitude has increased. We do not allow any new employees to start working in their actual position or interact with our guests without scoring a perfect 100 percent on the test.

The actual questions on this type of test will differ based on your company, its services and the position for which you’re testing or hiring. The important thing is that an E-SAT will help you ensure that your employees deliver the type of service you expect them to every time they interact with a client or potential customer.

But it’s not just the front-line employees who need to increase their service aptitude and require more soft/people-skill training. I have worked with hundreds of businesses as well as professionals, such as accountants, financial advisers, consultants, lawyers, programmers and doctors, all of whom are extremely skilled and trained technically but are not strong at customer/client services and knowing how to build relationships. Every employee — front line, administrative, professionals and, yes, your management team —needs some customer experience training.

So what is the service aptitude of your organization? Do you assume it is high enough or are you taking steps to ensure it is top notch by measuring it and training your team?

Look at your employees and you’ll know for sure.

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret” (due out April 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at

Published in Cleveland