As a national provider of supplemental health insurance products, Broadview Heights-based Family Heritage Life Insurance Company of America serves two primary customer groups: its policy-owners and its agents.
Ed Rocheck, senior vice president of administration at Family Heritage, says policyowners individuals and families who purchase the company’s products receive value, convenience and security from the company.
The company’s products are designed with a winwin approach. Its Return of Premium feature provides a return of all premiums paid, less any claims received, to the policyowner after a specified number of years. This allows policyowners to have the insurance coverage in case they need it and returns all premiums to them if the coverage is never used. This feature allows Family Heritage to make price less relevant in the buying decision.
Family Heritage wants employees to treat policyowners the way they would like to be treated, and new employees are encouraged to spend a day in the field with an agent to watch the sales process. This training not only puts a face on the policyowners but also helps employees appreciate the agent’s role within the company.
The company also treats its independent contractor agents as customers, and they receive speed, quality and support from the company.
Agents who have questions are welcome to call anyone at the corporate headquarters, including the executives, and responses are provided as quickly as possible. Speed also comes into play with customer applications, which are processed within 24 hours.
When agents visit the home office, they are treated with the utmost respect. Meetings are scheduled with the executive team, and employees to gather so the agent can meet them. This, in turn, promotes a spirit of teamwork and shared vision.
HOW TO REACH: Family Heritage Life Insurance Company of America, (440) 922-5200 or www.familyheritagelife.com
When you think about the vendors that support a business and make it successful, you tend to come up with a long list of payroll companies, employee benefits providers, financial planners and wealth management firms.
Cleveland-based CBIZ Inc. prides itself on being able to offer those professional services and more to its clients and their employees. By offering combined services through one trusted adviser, CBIZ has a competitive advantage because it allows company owners to focus on their core competencies.
CBIZ President and COO Jerry Grisko says having member offices in major U.S. cities allows his firm to offer the resources of a national company while providing the personal services expected from a local business partner.
Satisfied clients are the goal of great customer service, and every CBIZ client receives a guarantee: If it is not satisfied with the work provided by CBIZ, the firm will correct the situation to the client’s satisfaction.
The firm also offers a service promise to its clients that includes a commitment to professionalism, trust, and the highest level of personal and professional integrity; immediate response to the client’s needs; and understanding the client’s goals to provide proactive solutions to improve and grow the client’s business.
Grisko supports his associates who, in turn, support the level of service they provide to their clients. The firm motivates its employees by providing competitive benefits, rewarding staff members for outstanding performance and offering them opportunities to expand their career path.
Personal and professional growth get top billing at CBIZ, where its human resource professionals are certified to train its employees in enhancing their leadership and customer service skills. The firm implemented a sales academy program that has led to better client relationships and a more educated understanding of their needs.
HOW TO REACH: CBIZ Inc., (216) 447-9000 or www.cbiz.com
Growing up, Greg Nelson always dreamed he would make his living surrounded by luxury cars. So after high school, he entered a sheet metal workers apprentice program but soon realized it wasn’t the right path for him. He graduated and then went on to college at Franklin University before taking a $15,000 loan from his father in 1981 to start Columbus Classic Cars. Today, he is president of the $68 million Nelson Auto Group, employing 100 people at Chrysler, Dodge, Jeep and Lamborghini dealerships in Marysville and Bellefontaine, with a Hyundai dealership opening in Heath this year. Smart Business spoke with Nelson about strong leadership and how he managed the toughest day of his career.
Lead by example. I work 70 to 80 hours a week, so my employees see me there all the time. I think they feel like, ‘Hell, if he’s here all the time and working hard, we ought to do the same thing.’
They’ll see me greet a customer or pick up a piece of trash off the lot. As insignificant as that sounds, it builds a foundation for the rest of the business in terms of respect.
Give back to the community. You can’t take, take, take from a community. People see through that; it’s superficial. I’m making my livelihood here and building my business here; I need to give back.
The community knows that. The customers see that and say, ‘We need to be doing business with this guy.’
Maintain a positive image. My name and reputation mean more than the money because if you don’t have a good reputation, what do you have? I’ve always felt that if you do a good job with your customers and your employees, the money will come.
Don’t be afraid to adapt. You have to be open to change. I’ve always made my guys wear shirts and ties selling cars. I looked at it as a sign of respect: If we’re taking anything from $5,000 to $400,000 from customers, I wanted my employees to be presentable.
We did a survey of customers, and 68 percent of the surveys said customers prefer the salespeople more casual in golf shirts. A lot of them felt like a guy in a shirt and tie had the upper hand.
If that’s what your customers want, that’s what you’ve got to do. Now we’re going to a golf shirt uniform. It’s hard because I’ve been doing it the other way for 26 years but I understand it, so I’ll make the change.
Be tenacious and strong-willed. So many guys start a business and things don’t go their way, and they just give up and quit. I’ve never done that, and believe me, there have been many times when it would have been a lot easier just to quit.
But I worked hard, and I made it through the difficult times. You need to be a person who is determined to win.
Create a flexible strategy. I have passed on some business opportunities because they didn’t fit into my plan. What do you want to accomplish? Where do you want to be?
If you don’t have a business plan, then you’re not going to get very far. You’ve got to have a plan and stick to it but you’ve got to be flexible inside that plan and make some modifications because business is changing all the time.
Manage with integrity. If you don’t have integrity, and if your work doesn’t mean anything, you might as well just hang it up and go home.
We had a situation where our service manager, service writer, mechanic and parts guy told Chrysler and a customer they put a part on the customer’s car. They really didn’t do that, and I heard about it.
As drastic an action as some people may have seen it, I pulled those employees in one by one, told them, ‘That’s not the way we operate,’ and terminated all of them the same day.
It hurt because I lost four good people who made a mistake, but I could not justify having the rest of my staff see that. I couldn’t condone it by letting them stay employed here. That sent a strong message throughout all my dealerships.
Sometimes you’ve got to make those tough decisions, but when you do, it sets the tone. Now these folks know what integrity’s all about: You’re going to do it by the book, the right way, or you’re not going to work here. That’s all there is to it.
It was probably the most difficult day of my career because I had never dealt with that before. We occasionally had to reprimand an employee or terminate someone but to have all those people in on it was very tough on me, because I thought I had done a better job. If I would have let them get away with it, then what was next?
I have a pretty high standard, but that’s the way I expect it to be, and it seems to work.
Nurture your staff. I’ve got people who have been with me for 15-plus years. I’ve watched these people grow and develop, and I’ve given them opportunities to go from salesperson to sales manager to general manager. That makes sense to me.
It’s interesting to see some young guys come in who think they know everything. I remember coming in and thinking, ‘He needs slapped around a little bit.’ But they learn from you, and they listen to you because they see you doing it.
Stay genuine. There are very few car dealers that come out on the floor and actually thank the customer. A lot of them think they’re beyond that; I guess I never forgot my roots. As long as I’m in touch, things are great.
When you forget your roots, arrogance sets in. When employees and customers see arrogance, they get turned off by it. It becomes like a big corporate structure where employees and customers think, ‘They don’t really care about me.’
We’ve always maintained a family feel, and I still find the time to visit all the dealerships.
HOW TO REACH: Nelson Auto Group, (614) 793-9000 or www.nelsonautogroup.com
Manoranjan, who serves as CEO of the Dublin-based business, says 3SG then had to change course to keep up with technology and customer demand. Today, his company provides document imaging, management solutions and business process outsourcing services to 400 clients. Its 300-plus employees are located in four U.S. offices and one offshore, and gross sales have grown 75 percent, from $6 million in 2004 to $10.5 million in 2006.
Smart Business spoke with Manoranjan about how he empowers employees to exceed client expectations.
Q: How can other executives grow their company the way you’ve grown yours?
Focus on what you do best and don’t get distracted by other opportunities coming through. [If] you are not the best there, don’t get into that. The other things can look easy, but it still takes a lot of your management time that is where you lose the focus.
Empower others. It’s hard for a small business to let people make the decision and be accountable. My partner and I used to be in every operational meeting and (managers would) look at us to tell them what to do, even though they were qualified and sometimes more experienced than ourselves.
Now we don’t enter the operational meetings unless they need some help. And, to tell you the truth, they do better than us because their focus is only that. My focus is companywide.
Mentally, we had to prepare to let it go. It’s hard for a small-business man, but if you don’t do that, you can’t grow anymore.
Q: How do you exceed customer expectations?
Our company philosophy is based on a book called ‘Raving Fans,’ by Ken Blanchard, who co-wrote ‘The One Minute Manager.’ I would say for three full years, we did not have raving fans; we learned it over a period of time.
Keep the expectations clearly defined. Once clients know that this is what they are expecting in return, then it’s easy to exceed that.
We have a client service director who reports to the president. She will talk to the client during the project, get their feedback and pass it along to the people who are providing (the service.) If there’s a shortfall, she’ll immediately alert the production manager. If she cannot fix it, she goes to the president.
The client knows up front there’s a person a customer advocate whose job is to make sure the customer is happy at the end of it. Sometimes, we had to do work twice; we have minimized our rework.
After the work is done, and sometimes during the work, we send out a survey to every client to get feedback. I cannot say we have 100-percent happy clients, but the percentage of happy clients is much higher than it used to be.
Q: What can prevent a company’s growth?
Not being attentive to your associates. A happy associate gives you a happy return.
We started with two associates and we have 302 as of December. We must’ve done something right. Our first associate who joined is still working for us.
When you are growing, you sometimes tend to forget the associates. Reward them, recognize them and bring in the family atmosphere so every single person feels that they are a part of the company.
We have more benefits than a lot of companies our size. It’s a cash investment. Most companies don’t, and I think that paid off. Ninety percent of our cost is in our associates.
Q: What advice would you share with other CEOs of fast-growing companies?
Be honest to yourself. If you take a project that is bigger than you can handle, you’re going to fail and not only lose that business but it’s going to affect your reputation. Always ask the question: Can you do it?
If you can’t, partner with a company that can do it. It’s difficult when someone’s knocking on the door but you have to say no.
Look for controlled growth. Your growth is controlled by three things: your capital or available financing, people to manage the growth, and not just customers but good customers who are profitable for you.
Don’t oversell yourself or it’ll be a crisis. You need the cash to meet payroll but you cannot bill that client until the work is done. The bank will only go along up to a certain place.
In that stressful situation, you will be firefighting more if you don’t produce the best product for your customer. When you lose focus on your customer, you won’t have a raving fan.
HOW TO REACH: 3SG Corp., (877) 761-8394 or www.3SG.com
When Mike McGovern started his Columbus information technology consulting firm in 1990, he didn’t like its technical name — even his employees couldn’t remember it. Seven years later, he renamed it Odyssey Consulting Services Inc. “I like Greek mythology and had seen a definition of ‘odyssey’ as a long journey brought on by many changes of fortune,” says McGovern, Odyssey’s founder and president.
It was the perfect description of the IT consulting industry, and the name stuck. Odyssey later acquired three competitors, and today, the company has 150 employees in offices in Columbus and Chicago. It posted $26 million in 2005 revenue, a 137 percent increase over 2003.
Smart Business spoke with McGovern about how he learned that paranoia breeds success.
Q: How do you recognize business opportunities?
First, it’s got to be profitable, then you find out about the relationships of the current business. Are they going to end soon, or will it continue so you’re getting future potential value?
Then, if it involves bringing on employees, are those people going to match up with your company culture and how you do business? It’s got to match closely with the future goals of the company. You don’t buy a company for the sheer sake of increasing your revenue; it’s got to make sense with what you already do.
You should do due diligence on the company before you purchase it. Check out what their consultants are doing, what clients they have, how long they have been there, what technology they’re using.
The final thing is verifying what’s being presented to you, in case anybody misrepresents how long a contract’s been going or how much margin’s being made.
Q: How do you create a growth strategy?
In our industry, we figured that centralized vendor management systems were going to be the norm, not just a short-term trend. We focused on making sure we had enough relationships intact with our clients so when those lists were created, we were on them.
If you’re not on them, it’s very difficult to do business with clients.
Q: How can a business leader create those client relationships?
Service the clients and keep in contact with them all the time, even when they’re not busy. Also, you have to continue the relationship even if it’s not highly profitable because if you’re only focused on the margin, you’re not focused on the long-term relationship.
Q: How can companies keep employees happy?
Treat them with respect and a competitive pay or better so they don’t get recruited away. We have to treat them fairly and give them training so they feel a connection to our company, not just [like] a commodity.
It’s a relationship — how you speak with them, how often you check with them, how you treat them when they have issues or questions, how respectful you are of them.
I don’t want arrogant, high performers; that’s a short-term, short-sighted goal. You get somebody who’s a high producer, but while they’re doing that, they’re alienating the rest of the world and hurting the morale of the office. It’s just not worth it to me.
When people walk away from Odyssey, whether they worked here or not, I want them to say, ‘That’s a good company. I’d recommend them.’ There’s not much gain to building your database of enemies.
Q: What advice would you give other executives?
Keep your eye on as many clients as you can realistically handle, and don’t allow your current business to be your plan for the next two years. You need to supplement (your client base) at all times. [Intel Corp.’s founder and senior adviser] Andrew Grove said, ‘Only the paranoid survive.’ Founders, by general nature, are that way. I have never rested easy thinking, ‘Things are good now. We don’t have to chase down a lot of stuff.’
If you have five major accounts, you could lose two of those, and then 40 percent of your company could be gone. You always have to be thinking, ‘Who am I going to get next as my client?’
If you want to focus on growth, maintain what you have but look at how you’re going to grow. What new clients are you going to get? What new things are you going to go after and develop? That’s the biggest key for success.
Q: How do you stay motivated?
Most entrepreneurs tend to get a little bored with the mundane, everyday processes. I find it more exciting to brainstorm new ideas of how we can go after this or that, look for new business and new ways to do it. That’s what I enjoy.
HOW TO REACH: Odyssey Consulting Services Inc., (614) 523-4248 or www.odysseyconsulting.com
Novagard Solutions recently faced a big problem. Petroleum-based raw material costs were escalating, and the company couldn’t continue to absorb these increases, but it didn’t want to pass the burden on to its customers.
Historically, Novagard’s Foam Seal Industrial PVC Foam competed as a low-cost producer, and without a change in strategy, costs would drive the company out of the industry. “Change brings opportunity,” says George Buzzy, the company’s president. “Companies have to grow in size, in sales, in earnings, and if you’re not growing, someone else is.”
Once the Novagard team decided to pursue the change in strategy, Buzzy coordinated his research and development, sales and marketing, and finance departments, “because they all have to work together, each of them bringing different things to the table, so that we do it right.” The role of a successful executive, Buzzy says, is to keep employees focused on reaching out into the marketplace, talking with customers, researching the competition and understanding how the company can take advantage of opportunities.
Buzzy says executives who do their due diligence can avoid making three big mistakes. 1. Making a good product that’s so price-competitive the company can’t make money selling it 2. Making a product that’s similar to others in that space so the company is “just another me-too” 3. Making the wrong product because the company doesn’t understand its customers’ needs “There’s a lot of risk of wasting time and money without doing your homework,” Buzzy says.
After extensive research efforts and production line trials, Novagard launched Foam Seal CE PVC Foam, a cost-effective and high-quality alternative to the brand’s industrial line. Every Novagard customer has converted to the CE line, and the industrial line has been retired.
Sales increased 13 percent in 2005 with an additional 25 percent increase in 2006. Scrap rates decreased 3 percent in 2005 and remained flat in 2006, while potential working capital costs decreased 5 percent.
HOW TO REACH: Novagard Solutions, (800) 380-0138 or www.novagardsolutions.com
Kent Stuckey is not a fan of the rock-star CEO mentality. The chairman and CEO of Columbus’ Internet Transaction Solutions Inc. doesn’t believe that when a CEO enters a meeting with a great idea, everyone should drop down and worship it.
“It’s got to be community facilitation,” he says. “We need a choir, not a lead singer.”
ITS’ 75 employees work with companies to accept electronic payments from customers. The company has grown revenue from $4.4 million in 2003 to $12.3 million in 2005, with a 2006 estimate of $18 million.
Smart Business spoke with Stuckey about how he manages his Inc. 500 company.
Q: What does it take to grow a company?
It requires both a clear vision of where you’re going and the ability to fine-tune your vision. People often say you need a clear vision and a commitment to that vision. In my experience, your vision can make all the sense in the world and still fail.
You’ve got to have your ear to the ground, look at what is really needed in the marketplace and make adjustments so you’re providing to the market something that’s meaningful that they want and need.
Q: How do you keep growth under control?
Early on, a member of our team brought to my attention a book by Verne Harnish called “Mastering the Rockefeller Habits.” It’s a concise summary of a number of principles that you would be taught in an MBA program.
We adopted it as a foundation to share common terminology and for us to achieve alignment so everyone understands our objectives and works together toward achieving them.
A key point in the book involves rhythm. My management meets every morning in a huddle, and certain data metrics are reported on every day. The morning huddle is extremely important; I would never be anywhere close to as smart as my whole team is. [It’s more effective] to try and make decisions with our big brain, rather than my little one.
It’s a stand-up, 15- to 20-minute [meeting]. We report on our data metrics. We identify any bottlenecks so those can be addressed right away and any exceptional opportunities or issues on which we should be getting input. If anything’s bigger than we can deal with in huddle, then we schedule a meeting promptly to sit down and work through the issue.
Part of the rhythm idea is to take quick action. Otherwise, things get bigger, or are perceived to be bigger or more challenging than they are.
Q: How has this benefited your company?
We have a healthy respect for our priorities. Everybody can have a different opinion and there are appropriate channels to express your own opinion but once we establish priorities, we have to all be committed to them.
All our energies have to be aimed at the target and no place else, regardless of your opinion. We have very high morale, excellent commitment and outstanding alignment, by virtue of this process that we pursue.
Most companies hit a wall and stop their growth because all too often, they don’t re-create themselves. If you’ve got three people in a company and nobody lets go of any responsibility, you’re never going to have more than three people in your company.
You have to keep redefining roles, over and over again, so your scope of responsibility narrows but the depth of your expertise and performance grows.
Q: What can prevent a company from growing?
Lack of clear direction, lack of alignment and resistance to change. Frankly, I could give you a hundred reasons because it’s so much easier to fail than to succeed.
Q: How can a CEO survive a bad situation?
Don’t be afraid to require commitment to the team goals. If a company is in trouble, chances are, you’ll need to determine who’s committed to team objectives and who, for the interest of all, should move on.
Unless there are some really tough external market conditions, a company is likely failing because of lack of clear direction and lack of alignment among the team. If you’re providing some service or product demanded by the market, it’s a matter of how efficiently you can deliver.
It comes down to alignment and good decision-making. If you’ve got your team pulling in different directions, you’re not going to be much of a competitor.
HOW TO REACH: Internet Transaction Solutions Inc., (877) 272-9245 or www.transactionsolutions.com
Philanthropy is serious business at Westlake’s Nordson Corp., which has provided more than 50 years of service to local nonprofits.
Edward Campbell, chairman and CEO of Nordson, says businesses should share their success with the communities in which they operate.
“Nordson was founded with the belief that by providing customers with outstanding products and services, offering employees fair compensation and career opportunities in a positive working environment, and giving back to our local communities, shareholders will benefit,” Campbell says.
Nordson produces equipment to apply adhesives, sealants and coating to consumer and industrial products. and each year, it contributes 5 percent of its pretax domestic profit to support the Nordson Corp. Foundation. Last year, the corporation paid out $1.6 million to the foundation, which distributed $925,483 to nonprofits. This year’s contributions are expected to reach $2 million, with 75 percent earmarked for local organizations.
The company made $164,620 in direct corporate gifts to nonprofits in 2005. It also matches employee contributions to nonprofits dollar-for-dollar, up to $6,000 each calendar year; Nordson contributed nearly $500,000 through this program in 2005.
But it’s not just about providing funding. Nordson’s Time ’n Talent program sponsors year-round volunteer activities, with area employees logging 1,532 hours of volunteer time with nonprofits last year. Nordson also created the Technical Assistance Taskforce this year to provide information technology services to nonprofits.
“A company’s reputation and values are important to both customers and employees. The values behind our commitment to our communities also drive the integrity of our commitments to customers and employees,” Campbell says.
For the past three years, Nordson has leased a building it no longer uses to an Elyria nonprofit teen organization for $1 per year.
Projects also include building a playground and basketball court at an Elyria public housing development, and it acts as a facilitator between the Lorain County Schools and local service providers.
“Social responsibility is not a part-time strategy,” Campbell says. “It runs to the core values of the company and its leadership. Everything flows from there how strategies are set, decisions are made, people are treated and communities are valued.”
HOW TO REACH: Nordson Corp., www.nordson.com or (440) 892-1580
Community service makes a positive difference in people’s lives, and the employees of the Cleveland Clinic West Region are responding to those needs in their individual communities.
The Clinic’s West Side health care organizations Fairview, Lakewood and Lutheran hospitals have responded to community needs for decades with clinical services and community outreach programs.
“I am proud of our management and employees, as they have put service above self and have come together for the common good of our community,” says Fred DeGrandis, CEO of the Cleveland Clinic West Region.
As part of the hospitals’ Volunteers in the Community program, each member of the senior leadership team is expected to do a minimum of 50 hours of volunteer service every year. Middle management is expected to provide 25 hours of community service annually. Last year, the employees and medical staff of Fairview, Lakewood and Lutheran hospitals volunteered with more than 315 Cleveland-area organizations.
“Our volunteers have faith that miracles can happen, a quiet, clear understanding of what can be done, and the passion, conviction and perseverance to do the right things,” DeGrandis says. “They are heroes because they take the time to provide service to help make their community, schools, churches and businesses or homes a loving, caring and serving place.”
To understand and respond most effectively to community needs, the hospitals conduct ongoing formal community health assessments and frequently solicit input from community representatives. Each hospital maintains its own community advisory board which includes school superintendents, parents, clergy, safety personnel, health care providers and politicians to enhance communication in the community.
The members of these boards use their quarterly meetings to generate ideas, discover and establish mutually beneficial community partnerships, and build innovative clinical and community outreach programs.
“I know that this type of service is not put on a pedestal,” DeGrandis says. “But I know that service that comes to life through small acts of fellowship roots deeply and allows our organization and this community to grow with strength of purpose.”
HOW TO REACH: Cleveland Clinic Western Region, (216) 476-4926 or www.cchswest.org
For some companies, starting a social action committee might be a challenge, but at Southwest General Health Center in Middleburg Heights, it comes naturally. L. Kenneth Taylor, president and CEO, says health care professionals inherently understand the importance of giving back to the community, so it isn’t hard for his organization, a not-for-profit entity, to support other organizations.
“We feel a very special responsibility to give back to the communities we serve, in terms of either uncompensated care or health education programs,” he says.
Hospital employees, physicians and volunteers raised $63,000 to support the families of the victims of Sept. 11 and $67,000 to assist the victims of Hurricane Katrina. In addition, they give funds annually to United Way and Community Shares.
Southwest employees also established the Associate Angels program. Employees who find themselves in financial straits can apply for a noninterest-bearing loan. An employee-led governance council manages these funds, which have helped many employees, including one who lost his home in a fire, and another a spousal abuse victim who was living in a temporary shelter and needed money to get an apartment.
With so many people and organizations asking for help, how does a philanthropically minded company choose which causes to support?
“We found several years ago that we were getting requests from everybody, and it became very easy to say, ‘This is a personal favorite of mine,’ when, in fact, it really was not consistent with the mission of Southwest General,” Taylor says. “So we put some criteria down on paper, and that’s what we have been following for the past several years.”
So how does he create a culture of social responsibility?
“It’s really a matter of identifying the people within your organization who are interested in carrying the message to their colleagues and supporting them and it will grow by itself,” he says.
HOW TO REACH: Southwest General Health Center, (440) 816-8650 or www.swgeneral.com