Brooke Bates

There are many ways for fraud to be committed against your organization, but corporate checks are one of the more popular attack methods.

The problem is not a small one. Fraud against bank deposit accounts cost the industry $1.74 billion in losses in 2012, according to the American Bankers Association Deposit Account Fraud Survey. Of that amount, debit card fraud accounted for approximately 54 percent of losses, followed by check fraud at 37 percent.

To combat the problem, banks have added layers of fraud protection through services such as positive pay. By matching a list of checks issued by a business against the checks presented for payment, positive pay can spot discrepancies before fraud occurs.

“The positive pay service is essentially a fraud protection service,” says Korlin Scott, senior vice president and director of Commercial Product Management at FirstMerit Bank. “It’s a way for a business to monitor check disbursements and control items that might potentially be fraudulent.”

Smart Business spoke with Scott about how positive pay works and recent enhancements that provide additional security.

Why is positive pay a necessary business feature of corporate disbursement?

Phoenix-Hecht conducts an annual survey of corporate treasury managers at middle market and large corporations. The 2012 survey found 82.5 percent of midsize and 76 percent of large corporate respondents experienced attempted check fraud.

With the increasing sophistication of forgers and technology, corporations are turning to banks to detect and reduce fraud exposure. Large corporations are more likely to use positive pay, according to Phoenix-Hecht, with smaller corporations citing cost as the biggest reason for non-use. However, the relatively small fees pale in comparison to the potential costs incurred when a fraudulent incident occurs.

How exactly does positive pay combat corporate check fraud?

The service requires customers to provide the bank with a list of issued checks, which they can key in manually, upload as a spreadsheet or from an accounting system, or send automatically via direct connection. Then, as payees present checks, the bank matches details on each against the records.

There are extra levels of service in which checks are viewed systematically to match against things like the check microdata and the courtesy amount versus the legal amount. Other fields flag things like stale dated checks. By matching all components of information that are on a check against the issue record provided by the customer, the bank can provide the exception to the customer whenever there’s a discrepancy.

What are some recent improvements to positive pay services?

Standard positive pay services typically scan the check amount and serial number, but one enhancement adds another checkpoint: the payee name. If that name doesn’t match, exceptions are returned to customers daily for review and payment decision.

As the banking industry has moved to settle check payments by clearing check images, through processes like remote deposit capture, positive pay with payee name verification helps offset additional exposure to fraud due to loss of physical check stock security features.

In addition, checks are typically reviewed during a nightly posting process. Now, bank tellers scan checks as they’re passed across the counter, before the posting process begins. It gives tellers control at the point of presentation.

One of the biggest ways check fraud is committed is by fraudsters intercepting real checks and either washing the payee name off and adding their own name, or recreating the corporate check in their own name. Then, they’ll present those to the branch.

With its added layers of security, positive pay can proactively spot discrepancies before funds are paid out to help companies catch check fraud as well as prevent minor errors that throw accounts out of balance. The key, though, is being proactive.

People get excited about this when something actually happens to their account, but by then it’s too late. Positive pay is beneficial because it gives the ability to prevent potential losses by being proactive, instead of reactive.

Whether it’s actual fraud or error-related processing, you can mitigate potential losses that may be fairly notable.

Korlin Scott, senior vice president, director of Commercial Product Management at FirstMerit Bank. Reach him at (330) 996-6496 or korlin.scott@firstmerit.com.

Insights Banking & Finance is brought to you by FirstMerit Bank

Tuesday, 03 January 2012 15:04

Building up downtown

The Cleveland Medical Mart & Convention Center is starting to take shape downtown. But there’s a lot happening on this 36-month, million-square-foot, $465 million construction project that you won’t see carried in on a crane. Several executives from Turner Construction Co., Cleveland, gave Smart Business an exclusive video interview to discuss what’s happening behind the scenes to keep this skyline-altering project on track.

WATCH the overview video of the Cleveland Medical Mart & Convention Center: bit.ly/MedMart

“We often say that 95 percent of a job is won or lost before you even start breaking ground,” says Turner Vice President and General Manager Mark Dent.

From coordinating traffic with the city department to engineering around Lakeside Avenue, which bisects the construction site like a bridge, the site’s downtown location presents a number of logistical and technical challenges. Turner was able to foresee potential obstacles long before breaking ground through planning technologies like Building Information Modeling, coupled with good, old-fashioned collaborative innovation with construction partners MMPI.

This foresight has added layers of sustainability, safety and quality control to the construction project as the team uncovered opportunities to recycle and reuse demolished materials on the way to becoming LEED-certified.

In fact, by the time the project is complete, as much as 98 percent of what was demolished will be recycled — which is no small feat for a project this big.

WATCH the video, “How Pre-Planning Saves at the Cleveland Medical Mart and Convention Center Jobsite:” bit.ly/MedMartPlan

A jobsite of this size and scope presents a number of opportunities, as well. The Turner team has sought several ways to support community and economic development throughout the construction process — long before the convention center even opens. From interns and apprentices to SBE contractors, Turner is helping revitalize Northeast Ohio’s economy by building jobs as it builds a beacon of future economic growth. In total, more than 20,000 jobs will be created during the three-month span.

“These kids get to come in here and see, hands-on, what the work environment’s like,” says Project Executive Marty Burgwinkle. “Maybe they’re going to get interested in construction, but even if they don’t, they’re going to see how a business works. If they are interested and we find out they’re a good fit, we hire a number of them full time.” 

WATCH the video, “The Cleveland Medical Mart and Convention Center: Economic and Community Development:” bit.ly/MedMartED

Stay tuned as Smart Business adds more to this series to update you on Cleveland’s biggest construction project.

How to Reach: The Cleveland Medical Mart & Convention Center, www.ClevelandMedicalMart.com

Turner Construction Co., Cleveland: www.TurnerConstruction.com/Cleveland

Thursday, 15 December 2011 16:49

Building up downtown

The Cleveland Medical Mart & Convention Center is starting to take shape downtown. But there’s a lot happening on this 36-month, million-square-foot, $465 million construction project that you won’t see carried in on a crane. Several executives from Turner Construction Co., Cleveland, gave Smart Business an exclusive video interview to discuss what’s happening behind the scenes to keep this skyline-altering project on track.

WATCH the overview video of the Cleveland Medical Mart & Convention Center

“We often say that 95 percent of a job is won or lost before you even start breaking ground,” says Turner Vice President and General Manager Mark Dent.

From coordinating traffic with the city department to engineering around Lakeside Avenue, which bisects the construction site like a bridge, the site’s downtown location presents a number of logistical and technical challenges. Turner was able to foresee potential obstacles long before breaking ground through planning technologies like Building Information Modeling, coupled with good, old-fashioned collaborative innovation with construction partners MMPI.

This foresight has added layers of sustainability, safety and quality control to the construction project as the team uncovered opportunities to recycle and reuse demolished materials on the way to becoming LEED-certified.

In fact, by the time the project is complete, as much as 98 percent of what was demolished will be recycled — which is no small feat for a project this big.

WATCH the video, “How Pre-Planning Saves at the Cleveland Medical Mart and Convention Center Jobsite”

A jobsite of this size and scope presents a number of opportunities, as well. The Turner team has sought several ways to support community and economic development throughout the construction process — long before the convention center even opens. From interns and apprentices to SBE contractors, Turner is helping revitalize Northeast Ohio’s economy by building jobs as it builds a beacon of future economic growth. In total, more than 20,000 jobs will be created during the three-year span.

“These kids get to come in here and see, hands-on, what the work environment’s like,” says Project Executive Marty Burgwinkle. “Maybe they’re going to get interested in construction, but even if they don’t, they’re going to see how a business works. If they are interested and we find out they’re a good fit, we hire a number of them full time.”

WATCH the video, “The Cleveland Medical Mart and Convention Center: Economic and Community Development”

Stay tuned as Smart Business adds more to this series to update you on Cleveland’s biggest construction project.

How to Reach: The Cleveland Medical Mart & Convention Center, www.ClevelandMedicalMart.com

Turner Construction Co., Cleveland: www.TurnerConstruction.com/Cleveland

Thursday, 01 September 2011 16:31

Consistently delicious

Phillip Keiser is a bit of a traditionalist when it comes to dessert. If, after his double cheeseburger with the works, he’s still inclined for custard, he goes for a plain vanilla cone. And it should taste the same whether he’s at the Culver’s restaurant near his office in Prairie du Sac, Wis., or the one in Elkhart, Ind., closer to his hometown. As president and COO of Culver Franchising System Inc., a chain known for its ButterBurgers and frozen custard, Keiser’s job is making sure everything, down to dessert, is consistent everywhere.

But he can’t be in all 435 locations at once.

“How do we keep brand standards going?” Keiser says. “One of our critical success factors is our franchise operators and their commitment to the brand.”

Because he takes extra care to bring in committed franchisees, Keiser doesn’t have to manage details too closely.

“The only way the brand grows is if we’re all in this together,” he says. “So our training program is more extensive than most. Our interview and selection process is more extensive than most. Our core values surrounding what type of franchisee we look for are more extensive than most.”

These days, those core values are stronger and clearer than before, thanks to Culver’s new “Welcome to Delicious” campaign that reinforces the chain’s reputation for good food, family values and great service. Founder Craig Culver is very involved in the campaign, telling stories about Culver’s ingredients and relationships.

So Keiser has to make sure those stories and values radiate throughout the Culver’s system. That starts with attracting and developing franchise partners who are committed to them.

1. Identify committed franchisees

When Keiser joined the company in 1996, Culver’s operated 44 locations. Now, nearly 400 restaurants later, he still hasn’t advertised a single franchise.

“They’re all sold by word-of-mouth,” he says. “Most of the folks have discovered us through a friend or relative or as a guest in our restaurant.”

Attracting interest, then, isn’t the challenge — it’s identifying the right candidates. The first filter is financial. Even though the restaurant business can be expensive, Keiser’s not interested in investors because investors don’t operate restaurants.

“The first thing is: They’ve got to be somebody that wants to run a restaurant day-to-day,” he says. “We require that in each one of our restaurants, we have an operating partner who needs to own either 25 percent of the operating entity and (25 percent of) the real estate or 50 percent of the operating entity. They’ve got to (be financially qualified) if they want to own the real estate.”

He runs background checks to verify financial standing, but validating the ability to run a restaurant takes more than paperwork.

“Many franchise organizations would do a Discovery Day, where they would come in and interview the franchisor,” Keiser says. “We have what we call Discovery Week, where they come on their own nickel. They need to buy uniforms and work six 10-hour days in our restaurant.

“Basically, during the week they’ll work every station in the restaurant. Can they figure out how to work the grill, how to make the custard? They get there early in the morning and work with our porters mopping the floors, scrubbing the fryers. They basically experience a little flavor of the day-to-day life of a team member working in our restaurant.”

Why subject potential franchise owners to entry-level work? Believe it or not, Keiser’s not testing prior restaurant experience.

“We really want them to do a gut check on themselves, is this right for them,” he says. “If you work in a kitchen, you get hot and you get some of the kitchen odors in your clothing. Are they OK with that, or do they think it’s gross? Are they OK wearing the uniform and seeing their friends? They’ve got to be comfortable with the environment.”

Not only the work but also the hours can weed out candidates.

“If they come from a traditional 8-to-5 type of Monday-through-Friday work environment, do they understand we do as much business after 4 o’clock as we do before 4 o’clock, and the weekends are big days for us?” Keiser says. “You won’t be successful with a Monday-through-Friday mindset.”

(continued on the next page)

While Keiser is looking for applicants to be comfortable with the environment, he’s not hung up on kitchen skills just yet.

“We’re really looking for people that have leadership skills, communication skills, critical thinking skills, team-building skills,” he says.

In the mornings during Discovery Week, applicants further reveal those skill sets through the Wonderlic Cognitive Ability Test, personality tests and a GED equivalency test measuring math and verbal skills. While Keiser considers these results, he doesn’t put too much weight on them.

“We’ve had people that have scored off the charts that haven’t done real well working in the restaurants,” he says.  “But it does give us an insight in terms of how that person is wired.”

To really understand what makes applicants tick, Keiser and other executives — including Craig Culver — interview them at the end of Discovery Week.

“Try to understand: What are their goals or objectives?” he says. “Most of them have some motivation to get into this. And if their motivations aren’t aligned with what we know it takes to be successful in this business, that’s probably a deal-breaker.”

Because the right motivation requires a lot of commitment, Keiser wants to make sure candidates are sincerely willing and able to make necessary sacrifices. Would their family support relocation? What if their July Fourth tradition at the lake couldn’t happen on July Fourth?

He also tries to read current employees’ interactions with applicants. Now that they’ve worked together a week, Keiser observes how well they mesh.

“You can tell sometimes by the body language of our team members, and you can see by the interaction of people, what they talk about,” he says. “The team member, if they’re leaving the shift, do they come over and say goodbye (to the applicant), or do they just leave because maybe they won’t see this person ever again? Are there hugs, or is it just pleasantries? There’s a lot of collective input from people that goes into this.”

To gather all that input, Keiser brings together everyone who interacted with the applicant on the following Monday. It’s crucial that opinions are kept quiet — especially from the top — until decision time.

“We don’t talk about the candidates during the week when they’re here,” Keiser says. “Myself or for Craig — if we met with somebody and said, ‘We really think they’re great,’ or, ‘Boy, I don’t think they’re very good,’ — because of our positions, we would taint somebody else’s insight.”

But come Monday, there’s no holding back. By engaging several team members around the decision, he gets a better-rounded view of applicants. Plus, by this point, he’s given applicants plenty opportunities to self-select themselves.

2. Train and develop your team

Discovery Week is just the appetizer for new franchisees. Once they’re on board, they dive into an intensive 16-week training course. The first 12 weeks are spent at the restaurants around Culver’s headquarters in Prairie du Sac — about two and a half of those in a classroom.

“Some of that would be dedicated to food safety, then everything from how to conduct training, how to use the training tools, how to conduct local marketing, to accounting practices, payroll, labor laws and presentation skills,” he says.

Franchisees spend the rest of the time mastering each workstation in the restaurant, not just learning what happens but also why.

“The product and techniques have to be followed,” Keiser says. “But part of the burden for us is to ensure that we have a policy or a procedure or a product or an ingredient that makes sense, that we can actually back it up and make a business case for it. When we do a good job with those decisions, we make it easier for the franchisee, that they aren’t thinking of doing it a different way.”

Throughout the program, trainers test franchisees and even reward the highest scores. Like school, they have to maintain passing grades to advance.

“If they aren’t cutting it in one area or another, then they have to go back and revisit it,” Keiser says. “A few times, we’ve actually had to extend the training a few days because they weren’t getting their arms around some aspect of the business. There’s a lot of testing, measuring and follow-up that goes into it.”

The ultimate test comes in the last four weeks, when new franchisees open two restaurants, facilitating a week of training and a week of opening for each.

“That’s where the dynamics really change, because when they’re working in our restaurants, the team members basically know their jobs,” Keiser says. “But now, they have to become the expert. Now, the people ask them questions. Now, they’ve got to help inexperienced team members overcome challenges of getting the job done.

“If they’ve never been through an opening before, they’re kind of standing there wide-eyed like, ‘What the heck’s going on here?’ The second time they do it, they really start to understand the challenges they’re going to face when they do the same process in their very own Culver’s restaurant.”

But it can’t be all work all the time. Most training programs at Culver’s include a cookout at Craig and Lea Culver’s home, or there’s a patio at the office that makes a perfect casual spot for serving beer and appetizers.

“You’ve got to look for some of these social times to get to know people on an individual basis and not make it all just about the business,” Keiser says.

NEXT: Staying present and engaged after training

3. Stay present and engaged

When you take time during training to get to know franchisees individually, you start the relationship with a good sense of alignment. But it takes constant effort to stay aligned.

One of the ways Culver’s does it is through a network of franchise business partners (FBPs) that acts as a field team to support the franchise community. Each FBP has about 20 restaurants to visit and measure against standards. They’re also on-call to help franchisees solve any business issues, from profitability to developing their teams.

But Keiser doesn’t use that network as an excuse not to get out in the field himself. Both he and Craig Culver visit restaurants throughout the system.

“I once had a guy tell me that as you advance, it becomes more and more difficult to get out of the office and into the restaurants,” Keiser says. “I always thought that was a little bit of bull, but I’ll tell you what — I can’t get out as often as I’d like to.”

At a minimum, he grabs lunch at a nearby Culver’s almost daily and tries to get out of Prairie du Sac for a couple of days each month to visit other restaurants.

The main goal of visits is shaking hands and saying hello. But he was a restaurant manager, too, once, and he still observes through those eyes.

“When I walk in the restaurants, I’m not the president of the company anymore,” he says. “I’m basically the restaurant manager, looking at the things I looked at when I last ran a restaurant in 1981: What’s the sense, what’s the feel? Do they have their act together? Do they have the right amount of products? Are the team members smiling at each other? Do they say please and thank you? They can’t fake that stuff.”

Even if they behave while you’re there, how do you know they don’t play while you’re away? The key is not drawing all your conclusions from one visit.

“You don’t just use one snapshot to tell the story,” Keiser says. “You use the collection of all the things you see happening at a restaurant: What are their patterns for growing sales, what are their patterns for growing people, what is their community involvement, how does that match up with the reports and what the other folks are doing?”

That big-picture mindset is important because you’re not just visiting a restaurant, you’re assessing how the local leadership is managing that operation.

“I not only have to see how the restaurants are doing, I have to evaluate how the rest of our leadership team is evaluating standards,” Keiser says. “You may go from one FBP’s region to another FBP’s region and you start to understand, OK, this guy or gal has a blind spot or that’s their hot button and they’re really pushing that aspect of the business. When I go out, I really try to look at it and say, ‘What are my directors of operations and my VPs talking about when they’re out there?’”

While tucking observations into his broader evaluation of the network, Keiser takes note of details, too.

“Ours is a very detailed business,” he says. “We measure our success in terms of penny profit on our menu items. We measure our success in terms of seconds in speed of service. There are a lot of details that go into it — not that I can get into all the details in my job — but [it’s important] to have enough of an awareness that when you do dig into a certain topic, you can get down to brass tacks and understand it.”

But tread carefully when dealing with details in the field.

“If you see a critical detail that’s being missed, you’ve got to be conscious (of the situation),” he says. “I have to remember that, for me, I’m just walking into another restaurant. For them, they’re getting visited by the president today, and that makes some people uptight.

“But when you see stuff that is on standard, you try to reinforce it. And if there’s a coachable moment, well, you do a little coaching, too.”

The main objective is just letting employees know you’re there and you care about what they’re doing. The more you do that, the better equipped you’ll be when issues need attention.

“If you have some things that aren’t quite to standard, it’s much easier to have some of those difficult conversations if there’s a relationship based on trust and mutual respect,” he says. “If they only hear from you when they did something wrong and they’re in trouble, so to speak, then that doesn’t work very good. … You’ve got to get together with people and get face-to-face as much as you can.”

How to reach Culver Franchising System Inc.:

Phone: (608) 643-7980

Web: www.culvers.com

Twitter: www.twitter.com/culvers

Facebook: www.culvers.com/facebook

NEXT: Get to know Phil Keiser better

The Keiser File

Name: Phillip Keiser

Title: President and COO

Company: Culver Franchising System Inc.

Headquarters: Prairie du Sac, Wis.

Locations: 435 in 19 states (from 44 when Keiser came on board)

Hometown: Nappanee, Ind.

Education: Bachelor’s degree in business from Manchester College

Previous jobs: various management positions with Burger Chef and Hardee’s

What was the last book you read? The owner’s manual for my car. Have you seen those new manuals? I mean, come on, they’re like books! And I still don’t know how to work all the stuff on the radio. But seriously, the last book I did read was ‘Decision Points’ by George (W.) Bush.

If you could have dinner with any three people, living or not, who would you choose and why? I’d like to have a conversation with Vince Lombardi because he was a Packer but also because I think he also had a lot of insight on how to motivate people and get things done and be disciplined.

In our industry, the person that I think would be a real hoot to talk to would be Col. Sanders. He basically started selling chicken out of his car and using a recipe as a business plan to become, now, one of largest restaurant companies in the world. From some of the folks I’ve met through our industry that actually have worked with the Colonel, I get the impression he was a pretty colorful character.

And then I think any former United States president. I’ve had a few opportunities over the years to hear a couple of them speak, and when they go off script and they start telling stories, OK, at that point, if walls could speak, there would just be a whole bunch of interesting things to get from any of them, regardless of how you view them from a political standpoint.

If your company had a theme song, what would it be? There could be a couple of them: I think the theme song from ‘Rocky.’ We’re not the big guy, but we’re always trying to grow. We’re always a little bit of the underdog and trying to make things happen, but we always believe in ourselves and we aren’t afraid to take on the challenge of the fight to get out there.

One of the other ones would be ‘We Are Family.’ We talk a lot about a spirit of family; we actually call our annual convention The Reunion. It’s the spirit we like to have at our gatherings with our franchise community and our team members.

What’s your favorite stress relief? I’m a landscape gardener. I live out in the country, and I have a woods and a perennial garden. So after all we do all week, then I just go out there with the plants and the trees and the grass, always cutting something, pruning something. I wouldn’t call it mindless work, but I can get out there and have some me-time and work up a sweat and get some sore muscles, too.

Tuesday, 23 August 2011 13:16

Turner Construction gives back to Cleveland

Kevin Fox will always remember the August 10 game at Progressive Field, but the part about the Indians tromping the Tigers 10-3 probably won’t be what sticks out. He’ll remember walking the ball out to the mound, or watching his 6-year-old brother Brian throw the first pitch, or meeting former team manager Mike Hargrove during the game.

Kevin, 10, suffers from a number of lifelong medical disorders, including epilepsy and autism. Despite these challenges, he inspires everyone around him by facing each day with enthusiasm. Because of this spirit, he was honored with a Courage Award at the 21st annual HeartThrob Ball, an event that benefits young patients at Cleveland Clinic Children’s Hospital.

But the baseball game wasn’t part of the award package – that was an added bonus Kevin received, courtesy of Turner Construction. The Cleveland office of the general contracting company, in its second year of sponsoring the ball, purchased an auction item that included loge tickets to the Indians game – which went right to Kevin and his family.

“As one of my colleagues was bidding on the auction item, Kevin walked up to him and gave him a high-five,” says Mark Dent, vice president and general manager of Turner Construction’s Cleveland office. “He didn’t need to say a thing; it was evident that he appreciated all the support. It was the least we could do for his courage and bravery.”

Dent counts community service as one of Turner’s responsibilities to Cleveland. Programs that support children, like the HeartThrob Ball, are especially close to the corporation’s heart.

“Turner is very committed to the communities in which we live and work,” he says. “Children are our future, and we make a special effort to get involved with programs that help them. These include the Cleveland Clinic event, as well as programs that teach kids about construction and guide them toward careers in the industry.”

Turner’s Cleveland office also volunteers with groups such as the Hattie Larlham Center for Children with Disabilities, Boy Scouts of America, Achievement Centers for Children and Youth Opportunities Unlimited. In fact, Dent’s team is currently building a new nature path at the Hattie Larlham group home in Solon – on a purely volunteer basis.

Beyond the corporate support of programs like these, many Turner executives serve as role models of charity in their personal lives, as well. Dent even gets involved in charitable events through his involvement in professional organizations – such as the Construction Employers Association, the Associated General Contractors of America and the Cleveland Engineering Society.

“I think you engage people by being a role model,” he says. “On a personal note, I get a lot of satisfaction from these types of activities, and when people see your spirit, it’s contagious.”

Dent tries to keep spreading that spirit around the company by reminding employees that they’re all in this together, and that they have a commitment to the communities that support Turner.

“Turner has a responsibility to contribute to the greater good of our communities,” Dent says. “We do that by giving back, in the form of our volunteer programs to youth and others, by promoting opportunities for (Minority and Women-owned Business Enterprises) and helping to sponsor events.”

And – because they’re all in this together, remember – the business may even end up benefitting from Turner’s efforts to help others.

“Sometimes, our activities do end up benefiting the business, although that was not the original intent,” Dent says. “For example, by promoting opportunities for M/WBEs, we are growing firms in the community. Many of the firms that have gone through our Construction Management Training Course have become subcontractors and have assisted us in building many of the major buildings in our community.”

While gifts of time and money are powerful, corporate giving can make perhaps the biggest difference when gifts align with the business. When you look at a company like Turner, which builds the structures that build cities, it’s easy to see how business benefits the community.

Turner’s current projects in Cleveland include: The Cleveland Medical Mart & Convention Center, Cleveland Clinic Fairview Hospital Emergency Room & ICU, Allen Theatre, Baldwin-Wallace Conservatory of Music, Beachwood High School and Westlake City Schools.

“These projects are making our community more vibrant,” Dent says. “The owners of these projects are providing thousands of jobs to the people in Northern Ohio. That’s a major contribution to our economy.”

The Medical Mart project – which is right on schedule, with underground activities coming to a close and the first wave of steel structure popping up – will start serving the community long before the building welcomes its first health care conference. In September, Turner will use the site to showcase construction careers for seventh and eighth grade students through the Career Awareness for Middle Schools Outreach Program – one of the many ways the company keeps giving back to local youth.

For weekly updates on the Medical Mart’s construction progress, check www.clevelandmedicalmartonline.com.

For more information on Turner Construction in Cleveland, visit www.turnerconstruction.com/cleveland/.

Tuesday, 16 August 2011 11:48

VIDEO: How Cleveland leaders innovate

There’s no wrong answer to the question, “What does innovation mean to you?” And that’s good, because no two answers to this question are alike.

So even after 22 years of asking leaders how they change, renew and improve their organizations, Smart Business is still uncovering new stories of innovation to inspire other leaders.

Over the last few months, we’ve invited several groups of local CEOs into our Cleveland headquarters to discuss how they exhibit innovation in their leadership roles and how they drive that creativity throughout their organizations. We found out that their fresh approaches to business are setting their companies apart and engaging employees in the process.

Here are several video clips to share what we learned from them:

Ralph Dise, Dise & Co.: “Being innovative doesn’t mean that you have to come up with the ideas yourself. It means that you have to give your people the freedom and the reinforcement to be innovative.”

Clark Rose, President, The S. Rose Company: “By becoming a deep listening organization, we believe we can establish the trust that’s necessary for people to reveal ways in which we can be helpful to them.”

Bill Ryan, President, USI Cleveland: “It really boils down to two things: mission and vision.”

Dennis Marvin, President and Owner, Marvin Wealth Management: “We’re innovative because we spend a tremendous amount of time working with our clients to find out their particular and individual needs.”

Steven Nobil, Cleveland Managing Partner, Fisher & Phillips:  “Too many leaders are so set on trying to figure out how to grow the business as opposed to grow the people."

David Browning, Cleveland Managing Partner, CB Richard Ellis: “Innovation starts with asking great questions. … By broadening the questions, you end up uncovering needs that really drive someone to act in a different way.”

Pete Kever, President, GHI Internet Services: “Don’t be too proud to ask questions and maybe look like you don’t know everything, because you don’t. You may not look like an innovator by asking a customer something that you ought to know already, but you actually are because you’re out there listening.”

Dolf Kahle, CEO, Visual Marking Systems: “…Brainstorm away from the business with the concept that everybody looks at it from the CEO’s eyes. They’re no longer in their little department; they’re CEOs for two days. By getting everybody involved, they’ve all got to think.”

Want more innovation? Join Smart Business and Kaiser Permanente on September 15th for the 2011 Innovation in Business conference in Cleveland. In addition to honoring this year’s Rising Stars, Visionaries and Master Innovators, this year's event will feature a one-on-one interview with James White, CEO of Jamba Inc. (makers of Jamba Juice), who will discuss how he repositioned the company to launch a new chapter of growth. More details here.

Surviving this economy has been a challenge for all companies, especially those in commercial real estate like Casco Contractors Inc. But it’s not the biggest challenge on President Cheryl Osborn’s mind.

Her sights are set higher — on not just surviving but maintaining stable growth through the downturn. She achieves this by creating open lines of communication to stay in tune with her employees’ workloads and putting technology in place to manage projects and keep everyone in the field informed, as well.

These processes have helped the firm, which specializes in Commercial Tenant Improvements, keep efficiency, quality and consistency first. And now, Osborn is looking forward to projected 2011 revenue that nearly doubles last year’s.

Because of this, Smart Business, ThinkASG, IBM and Union Bank named Osborn to the class of 2011 Smart Leader honorees. She shared how she maintains quality during growth and applies innovative technology to better manage her team.

Q: Give an example of a business challenge you and/or your organization faced, as well as how you overcame it.

Stable, managed growth is probably the biggest challenge that we have faced. Maintaining stringent quality standards can be challenging when a company is growing quickly, but our reputation has been built on the quality of our service, so quality control is something we take very seriously and always have in mind every step of the way. To maintain quality:

  • I provide my employees with every possible tool to help them manage their responsibilities.
  • I maintain open lines of communication to stay aware of workloads. And when someone is struggling, I work with them to determine if they are actually overloaded or if perhaps they need help managing time and resources better.
  • When I deem necessary, and once I’ve assessed that the company volume can support it, I hire additional people to fill positions at various levels of management or support.

 

We have created processes for the field and the office that specifically focus on efficiency, quality and consistency. We also use technology to improve communication and ensure that everyone involved has the latest information — something that is critical in an industry where changes are frequent and not having the correct information can cause major setbacks to both the budget and the schedule. Our superintendents all have e-mail via BlackBerrys, access to high-tech cameras, and we can send them drawings electronically — which is something that is very cutting edge.

How to reach: Casco Contractors Inc., (949) 679-6880 or www.cascocontractors.net

Read the entire interview with Cheryl Osborn at http://people.sbnonline.com/osborn.

Sunday, 31 July 2011 20:01

Creating a B2B social media strategy

Paul Furiga can get the attention of a business-to-business company’s CEO with a pretty alluring deal.

“I can get you to your 100 customers more often, more efficiently and with more fresh dialogue using social media than using any tool you can possibly imagine,” says the president and CEO of WordWrite Communications LLC, a Pittsburgh public relations agency. “How could they say no?”

Surprisingly, they do; the B2B market seems slow to embrace social media. Sure, business is moving online, acquainting corporate America with platforms from Facebook and Twitter to Yelp! and Foursquare. But when the best social media strategies and case studies seem to come from big consumer companies (ahem, Zappos), where do smaller B2B companies look for their social media guideposts?

Of course, some strategies are successful despite your structure, so mimicking some proven approaches from the big boys is a start. But the inherent differences between B2B and business-to-consumer companies necessitate that you tailor your strategy for your customers and goals.

“A $10 million B2C company, the average transaction size might be $100, so they are going to have 10,000 customers,” Furiga says. “The average $10 million B2B company might have 10 to 50 customers who are spending a heck of a lot more money on their average sale. For a B2C company, it’s all about how many followers you have and how much activity you get. For a B2B company, it’s not about quantity; it’s about quality — does your social media directly drive business results?”

Social media equips you with practically free tools to connect with each customer — and when you have 50 customers to their 10,000 consumers, that’s a definite advantage.

“B2B companies should be — and actually are, although you don’t see the trend yet — having much more success in social media,” Furiga says.

And here’s how.

Start with a hypothesis

Your first concern is probably something like, “Are business customers even using social media?”

It’s a valid question, and it’s the launch pad to creating your social media strategy.

“The first step is understanding: Are your customers there? Are they participating in those channels?” says Jennifer Horton, best practice consultant in the customer success and strategy group at Eloqua.

Eloqua, based in Vienna, Va., develops marketing automation and demand generation software to help companies “measure the digital body language of their buyer,” Horton says. The first step in that process is the same as any campaign.

“If you’re just getting started and you’re trying to understand, then let’s pick a hypothesis, i.e., ‘I think our customers are on Facebook,’” Horton says. “Then let’s prove that out or disprove it. We’ll get our Facebook page created, start to develop our fan base and use it to promote thought leadership content or upcoming events.”

To build that hypothesis, some of Eloqua’s clients use website analytics to identify which sources drive traffic to them. If they see significant volume through Facebook — which Eloqua found to be the top-referring social source of website traffic in a study of their entire client base — they dig deeper.

To prove a hypothesis, just like in a science experiment, you need research. Here, that comes from tracking what’s happening. Start with baby steps: Look at quantity before delving into quality.

“One of the places that a lot of people start is just understanding the total number of fans that they have or the total number of followers on a Twitter handle or the number of members that have signed up to receive e-mail updates,” Horton says. “Understanding your reach is definitely first and foremost. It gives you a good understanding of your potential to drive opportunities out of this group of people.”

Maybe people are already buzzing about your company, giving you a head start in building a fan base. But don’t forget about current customers on other platforms. Bring them with you, from newsletter subscriptions, e-mail opt-in lists and direct mail databases to the social space.

Then find ways to inject yourself into conversations, positioning your product or service as the answer to a question.

“Listening would be the first part of that, listening and understanding the topics that are being discussed, who’s participating in those conversations, and then identifying the appropriate response,” Horton says.

If they’re not talking about your specific company yet, back up and see what they’re saying about your industry or service. For example, Horton was on a Salesforce.com user group one morning when someone asked for a recommendation of an e-mail tool. Knowing Eloqua’s software would be a good fit, Horton alerted a sales rep for follow up.

“The companies that are doing (social media) well are … looking at ways of identifying where in the conversation in those social channels it makes sense for them to insert themselves and … providing a relevant and compelling offer to get them to continue the conversation that maybe started in a social community,” she says.

Continuing the conversation

When it comes to executing your social media strategy, forget what you know about marketing.

“For a lot of marketing conversations, there’s only one appropriate answer to the communication — and that is, ‘Buy,’” Furiga says. “The difference with social media is that it’s more about the conversations and the community. That’s why it’s cool for social media managers of consumer companies to just create an environment for people to hang out in. They are trying to keep people in the conversation, knowing that if they stay in the conversation, sooner or later they’ll buy.”

B2B companies, especially, have to strike a balance of building a community and directing it toward a sale. These goals go hand in hand, but different types of content point toward different ends.

Horton can’t jump in trying to sell Eloqua if people aren’t familiar with it. First, she must make Eloqua relevant to the conversation.

“If you think of ‘top of the funnel’ or brand awareness, we create content like infographics that are quick and interesting,” she says. “An infographic on the history of social media is enough to bring you into that Eloqua conversation.

“Now, for us to actually convince you why marketing automation software is a really powerful part of that story, it requires a different set of content: Why marketing automation? Why Eloqua versus our competition? A different type of content is used when the buyer is closer to purchase.”

Furiga goes even further to break down an effective content strategy encompassing industry generalities and company specifics alike. He calls it the rule of thirds.

“There’s a general guideline in social media, and that is: To have success in just about any channel, one-third — and no more than one-third — of your content is promotional,” he says. “One-third is news information (from your industry). Then the last third is the conversation — having a real dialogue with prospects and clients who have chosen to participate in your community.”

Generally, the overall social conversation leans toward sales and marketing. But you can’t just push yourself in front of prospects like an advertisement. Most B2B prospects are looking to social media for a demonstration of your expertise.

“B2B companies most often use social media to give potential customers a peek into what it’s like to work with them,” he says. “What do you know? What do you have to teach me? How can you help me? That’s where the whitepapers and the blogs and the free tools come from. More often than not, B2B companies are selling solutions, and the way you demonstrate your problem-solving capabilities is by having great supporting social media content.”

Educational tools like whitepapers, blogs, webinars and LinkedIn subject matter groups are effective for B2B prospecting. But those can be just as fun and engaging as consumer campaigns focused on games and viral videos.

Just look at Isilon Systems, an enterprise data storage company in Seattle. It brought in a magician to prank the IT department and created a video of him cutting a live Ethernet cord in the data center. Then, the company drove traffic back to their website by revealing there how the magician performed the trick.

“For both B2C and B2B companies, the ultimate goal is to have a continuing conversation,” Furiga says. “The difference is B2C social media can be all about hanging out online playing games, and that would be an OK ROI. For a B2B company, the fun is much more often directly connected to the business purpose. So a B2B social media strategy is going to focus on sharing intellectual capital, engaging prospects and pulling them deeper into a conversation that most often results in big dollar sales.”

Isilon’s videos engaged audiences with a magician’s secrets, but they also pointed to the business by urging viewers to safeguard their IT departments with the company’s solutions.

Content should be fun and creative if you want to grab attention in the fast-paced, sound bite based social environment. But for an offer to have any staying power, the content should also be relevant. You achieve this by taking the position of the problem solver.

“Social magnifies the basic rules of Marketing 101,” Horton says. “The No. 1 ‘do’ is to be helpful. So if someone’s asking a question, provide a relevant answer. Connect them with another person that might be able to answer their question. Social is online, but it’s definitely a human-to-human sort of relationship experience. Building relationships and developing conversations is what really, I think, drives the highest level of engagement in different social channels.”

[See more social media tips from Furiga's presentation, "Beyond Your Zappos Case Study: B2B Social Media for the Rest of Us," featured at the 2011 Public Relations Society of America Digital Impact Conference.]

Focus on conversions

To pinpoint what separates top social performers from the pack, Eloqua recently benchmarked its entire client base.

“Clients that are in the top-performing category are doing a very good job of tracking those things they put out in their social communities so they can understand which social sources are driving interested buyers back to their website,” Horton says.

Still, people have trouble uttering “social media” and “metrics” in the same sentence. How can you turn conversations into measurable conversions? It gets a little “squishy,” to use Furiga’s words.

“ROI in social media is like Jell-O for some people,” he says. “They can pick it up but they can’t really hold it. If that’s happening, then you’re not measuring the right things in your social media.

“It’s not just the number of followers or likes that you have; it’s the quality of the relationships that you create. Each company needs to determine its own metrics to define quality. It’s almost never how many followers you have; it’s almost always about driving toward something that you can count that affects the success of your business — it could be number of sales, number of whitepaper downloads, how many people comment on your Facebook page.”

Sure, you start with basics like number of followers. But now that you’ve given them content as bait, it’s time to find out who’s biting and why.

Start by identifying correlations. As your overall number of social followers increases, look for other trends on the upswing: How many visitors came to your website? How many of them opted in to your e-mail database or registered for your webinar?

“It may not necessarily be cause and effect — if we get 100,000 fans, we’re going to have X amount of leads,” Horton says. “But a lot of companies are starting to see that positive correlation: When we see an increase in the volume and the reach of our social channels, we have a correlating increase in how many Web form submissions we’re getting or how many qualified leads we’re passing over to sales.”

Once you understand general trends and how they’re related, take a closer look at conversions or who took the next step in your sales cycle — whether that’s downloading a whitepaper or contacting a sales rep.

“Of those opportunities where I placed a link back to my website, how many of those people took that next level of action?” she says. “Look at which social sources are driving the highest level of conversion, because that can give you a good indicator of how qualified those audience members are. You can have a very active social group with people that are highly interested but with no intent to purchase. If you can track it down to that point of conversion, you’ll get a better understanding of how close these people are to purchasing.”

For example, Horton helped a client track pay-per-click advertising across several keyword categories by setting up unique landing pages for each. By tracking form submissions, they identified two categories with the highest conversion rates. Then they realized that prospects searching one category converted to qualified sales opportunities within two weeks; the other took two months.

“That helped them inform how they should engage with those buyers,” Horton says. “People that were searching on that term actually had a line item in their budget, so they were a lot closer to purchase. Those were low-hanging fruit.

“The other category was taking a lot longer to convert. That allowed them to say, ‘Maybe we need a nurturing strategy with these individuals. Maybe we need to give them some more content to help them go through that evaluation process.’ Tracking that beyond the point of conversion starts to influence how you can communicate and engage with those buyers, based on where they are in their purchase process.”

Pinpointing buyers’ positions in the sales cycle can tell you when to leverage which social tools to lead them to a decision.

Maybe you’re still wary, convinced that the risks of social media outweigh the benefits. You think your customers aren’t on Twitter or worry that employees will post something inflammatory. Whatever your excuse, Furiga will tell you you’re wrong.

“Companies that don’t participate in the conversation are not stopping the conversation,” he says. “The conversation is out there. All you’re doing by not being part of it is making sure that your viewpoint is not represented. If you’re not part of the conversation, you can’t protect your reputation.

“I’m not going to say that every B2B company needs to be on every social media channel, but you shouldn’t reject it out of hand. You have to know what’s being said about your industry and your company. And if you’re willing to try one social media channel at a time, I believe you’ll be surprised at the success you can have.”

How to reach:WordWrite Communications LLC, (724) 935-7580 or www.wordwritepr.com. Follow @wordwritepr and @paulfuriga on Twitter.

How to reach: Eloqua, (866) 327-8764 or www.eloqua.com. Follow @eloqua and @jenhorton on Twitter, and read her blog posts here.

But wait — there's more. Read on for the sidebar section: How B2B customers use social media.

SIDEBAR: How B2B customers use social media

Before you purchase a new cell phone, you probably head online to inform your decision with reviews from fellow consumers. Business buyers are now doing the same; but with purchases of $100,000 instead of $100, the research is more thorough. Everyone involved in committee decisions is digging — many outside the sandbox of traditional information.

“If I work for a B2B industrial company and somebody approaches me about a new way to machine metal, and I try to explain to my boss how cool this is, eh, whatever. Maybe it works, maybe it doesn’t,” says Paul Furiga, president and CEO of WordWrite Communications LLC. “But if this company has a YouTube channel and they can literally show the difference, and I send my boss and all the other decision-makers the video, wow, is that powerful.”

James Rogers, vice president of marketing at Hoover’s Inc. in Austin, Texas, realized buyers were starting to layer social media with the business data they gathered from Hoover’s Dun & Bradstreet-powered website.

“We had a number of customers that were telling us they go to Hoover’s for the traditional business information like company, industry, people, size of the company, financials, news alerts, all those things,” he says. “Oftentimes, what they would do is alt-tab over to LinkedIn and then … try to identify the contacts and look up some of the information that we traditionally don’t capture within Hoover’s, such as their history and their subject matter expertise and areas of interest.”

After LinkedIn started hearing the same thing from its customers, the two companies entered a partnership in March to integrate their functionalities. Now, below Hoover’s traditional business information, you’ll find social media panes — attributed as such — offering more information on people and companies.

“Whether it’s (preparing for) a sales call, identifying leads, doing industry research, … customers are looking to purpose that information within their daily work streams,” Rogers says. “People want to view the social information in context with the more traditional business information.”

This partnership showcases the trend that, even in strictly business settings, social media is proving to be an important tool in purchasing decisions. In Rogers’ words, it’s gone mainstream.

“A lot of sales professionals are now recognizing that social media is not just about your family community or your personal interests,” he says. “Social media has information that’s relevant to business information, and there is value in correlating the social media content to business information. This social content has different context, so you have to give it the appropriate attribution.”

That context varies by buyer — social content can be more timely and relevant, but it’s also subjective because it’s not validated.

Furiga looks at the broad differences between traditional and social media information:

  • Speed: “Thanks to social media, I can get nearly instantaneous information on any person or any company in the world.”
  • Scope: “I just said ‘in the world’ — The Internet breaks barriers in terms of geography. In the old days, if I was a B2B company, I could only see as far as my geography would take me — meaning as far as a salesperson was willing to drive or as often as I was willing to go to a trade show. Now, I can literally search the world to make decisions.”
  • Transparency: “Most of us use a consumer ratings site to make restaurant or movie decisions. Now, I can get all kinds of great, transparent information about companies I might want to do business with, including testimonials.”

How to reach: Hoover’s Inc., (512) 374-4500 or www.hoovers.com. Follow @hoovers and @jamesc_rogers on Twitter.

How to reach:WordWrite Communications LLC, (724) 935-7580 or www.wordwritepr.com. Follow @wordwritepr and @paulfuriga on Twitter.

Monday, 18 July 2011 15:02

Innovating with applied creativity

Denny Griffith doesn’t have to try too hard to bring creativity into his organization. At the Columbus College of Art & Design, where he’s president, it already runs in everyone’s blood. His job is applying that creativity to achieve the college’s mission of preparing tomorrow’s creative leaders for professional careers.

“Applied creativity” is the college’s term for innovation, and it’s just as much a part of its DNA as the artistic creativity that manifests in paintings and sculptures. But this kind of creativity transcends into Griffith’s leadership, resulting in a growing organization.

Since coming on board as the college’s third president in 1998, Griffith has overseen renovations and new construction — like Design Square Apartments, the Loann Crane Center for Design and the college’s famous 10-story ART sculpture — not to mention the growth he’s seen academically and in community outreach and exhibition programs.

On top of it all, Griffith still teaches some painting and business classes and continues his personal work as an artist.

Because of this, Smart Business, U.S. Bank and Blue Technologies named Griffith to the 2011 class of Columbus Smart Leader honorees. He shared how he overcomes challenges and innovates as a leader to keep the college on the creative edge.

Give us an example of a business challenge you and/or your organization faced, as well as how you overcame it.

When I arrived at CCAD in 1998, it was clear we needed to improve the quality of our facilities and academic infrastructure to elevate our institution’s competitiveness with other regional and national leaders in art and design education. Over eleven years, we completed a 25-year campus master plan. We accomplished this via careful planning, constituent input and leveraging both our borrowing capacity and growing philanthropic profile to obtain the requisite financial resources to build and renovate a number of buildings. We now have the ‘urban learning village’ we dreamed of. And, along with our neighbors — Columbus State, State Auto and the Columbus Museum of Art — are working with the city to further develop the neighborhood as the ‘Creative Campus.’ So we have critical mass and collaboration, and it seems to be about to garner city investment in neighborhood infrastructure. All good stuff.

In what ways are you an innovative leader, and how does your organization employ innovation to be on the leading edge?

CCAD is by its nature concerned with fostering innovation, or what we call ‘Applied Creativity.’ Our graduates can be found across the country and around the world, in businesses large and small, in the entertainment and fashion industries, and in galleries and museums. In every way, CCAD alumni shape culture. And so innovation and creativity are part of our DNA.

As a leader, I simply try to support my people as best I can with the resources available. I also try to do my job with joy and with vigor. Leadership to me means setting the vision and developing a splendid team, then giving that team a great deal of responsibility, freedom and accountability, and getting out of their way so they can use their special expertise to advance the college.

How do you make a significant impact on the community and regional economy?

We work to continually improve the college and increasingly engage it with our community via internships, service projects, cultural and educational interactions, and the happy pursuit of beauty, creativity, design innovation, memorable visual communication, and the unabashed celebration of individuality. We are the leading economic development engine for the creative economy.

How to reach: Columbus College of Art & Design, www.ccad.edu

See all 2011 Columbus Smart Leaders on the next page.

Together with U.S. Bank and Blue Technologies, Smart Business named the following honorees to the 2011 class of Columbus Smart Leaders:

*Indicates Women Presidents’ Organization Breakthrough Business Leader

Thursday, 23 June 2011 15:04

Reflecting green customer initiatives

When a company’s projects include cleaning nuclear reactor test sites, building clean coal power plants and restoring wildlife habitats, you don’t have to look too deep into its operations to label it sustainable.

But environmental services alone weren’t good enough anymore for MACTEC Inc., which was recently acquired by international engineering and project management firm AMEC plc. Both inside the company and out, people started asking what really made it so sustainable.

“Whereas answers like, ‘Yes, we provide sustainable solutions,’ may have been acceptable in the past, people want you to demonstrate today how and what it is you do, both internally and externally,” says MACTEC Director of Sustainability Sarah Hansen.

As the conversation around sustainability matures from environmental generalities to business specifics, leaders like Hansen keep up by walking the talk, both through operations and projects. After all, industry credibility and image are on the line — not to mention client shareholder value.

“Our clients have certain expectations of a company that they hire because their stakeholders have certain expectations of them. It’s somewhat of a flow-down,” she says. “The ability for us to say, ‘Yes, we’ve been able to reduce our water use. Yes, we’ve been able to improve our recycling program,’ — we are asked those questions as part of proposal processes. Our internal performance does feed directly into what clients are asking of us.”

To answer some of those questions proactively, MACTEC released its first Sustainability Report, detailing the company’s accomplishments through 2010 and outlining plans and metrics for moving forward. It was a way of actively engaging dialogue around the question: How is your company sustainable?

“The scope of the question has expanded beyond health and safety, diversity, wellness, cost savings, risk reduction, etc.; today it is an integrated ‘sustainability’ perspective that seeks to measure organizational behavior and service delivery in terms of social responsibility, environmental stewardship, and economic benefit,” the report reads. “The challenge in measuring sustainability in our projects is establishing a shared understanding with our clients of what is to be measured and the expectations of performance.”

Building the big picture

MACTEC’s leadership had to connect the dots of sustainability’s shifts to be able to lay out expectations for clients. The first step was defining what sustainability meant and how it would be measured, inside the organization and out.

“We at MACTEC see it as having a responsibility to see that future generations have the resources they need to grow and prosper. That’s the global perspective, and everybody’s going to say something similar to that,” Hansen says. “More locally, sustainability means providing a preferred workplace for our employees, creating value for our shareholders, improving our community and preserving the environment through what we do.”

Most companies have general commitments, but MACTEC went one step further by breaking sustainability into three pillars that would be used to measure it, both operationally and through client projects.

“With sustainability, it’s a balance between the economics of the situation, the environmental impact and the social impacts,” she says.

When it came to measuring sustainability on a project-by-project basis, then, Hansen looked at three criteria within each of those three elements. For a project to pass the test, it had to satisfy at least one from each category:

  • Social responsibility: enhancing community stability, health and welfare, and aesthetics
  • Environmental stewardship: resource conservation, habitat restoration and ecosystem diversity improvements
  • Economic benefit: avoid/save costs, avoid/mitigate risk and enable client goal

When it came to measuring sustainability internally, Hansen wanted to give employees more concrete areas where they could control each office’s footprint. She surveyed each office last year about energy and water use, waste management, recycling and general facility management — and identified this list of Operational Sustainability Indicators:

  • Green cleaning
  • Energy-efficient lighting
  • Programmable thermostats
  • Access to public transportation
  • Energy sub-metering
  • Ride sharing
  • Work from home
  • Energy Star
  • Flow-limiting devices
  • Water sub-metering
  • Recycling

For sustainability to truly live top-down in the organization, Hansen had to engage the local levels around these areas to contribute to that bigger picture. So she set the expectation that each office would create its own sustainability plan to implement at least one environmental improvement project. She measured them quarterly, using the shared indicators, and expected to see return on investment in less than three years.

The challenge was turning a general commitment to sustainability into a specific strategic plan that held people accountable. How do you do that?

“The big answer is you have to change the culture,” Hansen says. “And to change the culture requires strong governance in conjunction with committed leadership. At MACTEC, we have the directional support from the board. Our senior leadership provides a vision. My team translates that vision into a structure with roles and responsibilities.”

The CEO appoints senior leaders to the Corporate Sustainability Team to advise and assist Hansen in decision-making. From there, responsibility branches out to office managers, who make sure that sustainability plans and projects are implemented — largely through the efforts of Green Ambassadors. Those local champions serve as key links in Hansen’s communication chain.

“We have an internal structure around sustainability that has accountability and responsibility assigned to each office,” she says. “That sustainability plan is approved by that local operations manager, and so he’s held accountable for meeting that plan — just like a financial plan. But locally, the Green Ambassador has the responsibility for seeing that it gets done.”

But the responsibility doesn’t stop there. Starting this year, every single employee is accountable.

“Beginning in 2011, every employee will be measured on sustainability metrics that we’ve established,” Hansen says. “In our annual appraisal process when every manager sits down to review employees’ performance for 2011, there’s two line items that deal with sustainability. Each employee will have to show how they contributed locally and corporately to the success of our sustainability initiatives.”

Achieving the specifics

Once an organization has the structure — both people and plans — to take on sustainability projects, you still have the challenge of, well, doing it.

And when you lease your office space — like all but one of MACTEC’s properties, which range from two to 200 employees each — you have yet another challenge when it comes to greening your internal operations.

“Because we’re in leased spaces and our offices are variable in size, we have the challenge that some of our offices don’t have transparency on the utilities. It’s an all-in type of lease; we just pay one lump sum that covers energy, water, etc.,” Hansen says. “If you can’t measure it, it’s kind of hard to improve it — except in a qualitative way.”

Aware of this, she built the expectations so that leased offices could still control local sustainability programs, even when they couldn’t measure them.

“At those locations where we have that limited to zero visibility on water and energy use, we look for them to implement what we call best practices, common sense measures: shutting the lights off if you’re not there, only running water when you need it,” she says “The simple things — you know that has to help but you just can’t measure how much that helps.”

Here are a few examples of the big savings MACTEC could measure by taking some of these small steps:

  • Energy use: Just by installing motion sensors and reminding employees to turn off lights, one location cut energy use by 1030 KwH. Another reduced consumption by 18 percent, saving $2,500 just through the third quarter. After replacing an aging HVAC system, another office estimated 2010 cost savings of $70,000 and annual cost avoidance of more than $120,000. Others installed programmable thermostats, more efficient lighting, blinds and awnings and Energy Star appliances.

  • Water use: By installing low-flow devices on fixtures and toilets inside and rain sensors on sprinklers outside, one office saved 131,000 gallons of water, reducing operating costs by about $1,800.

  • Waste management: In addition to recycling paper, aluminum, plastic, cardboard, electronics and toner cartridges, the company identified nearly 100 items it could replace with items containing recycled content. About 30 percent of the offices pursued green cleaning, and 75 percent eliminated Styrofoam use.

  • Paper reduction: At one office, delivering just two projects electronically saved more than 200 reams of paper. Another office saved an estimated 90 minutes of printing and binding time per project by going paperless. Furthermore, the accounts payable and procurement departments began requesting that suppliers submit invoices electronically — which will not only reduce supply and postage costs but also ensure quick delivery.

Through simple projects like these, 76 percent of MACTEC’s offices achieved their 2010 sustainability goals. They invested a total of $15,000 — but by the end of the year, they already exceeded the estimated three-year ROI. The company ended up saving around $80,000.

But it’s not just about saving money, especially if you look at it from your customers’ perspective. What’s in it for them? By revenue, 77 percent of the company’s projects helped clients reduce or eliminate an environmental risk last year, which translated into improved shareholder value for them. When sustainability results from your commitment to meet client expectations, it’s a win-win situation.

“You’re bringing new ideas in, you’re solving problems with a lot of minds that come at things from different perspectives,” Hansen says. “That’s really what’s at the core of advancing sustainability, because oftentimes what happens is innovation results. With innovation, you’ve done something cheaper, better, faster — and that’s what it’s all about.”

How to reach: MACTEC Inc., (877) 762-2832 or www.mactec.com

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