2018 EY Entrepreneur Of The Year®

EY honors the entrepreneurs who break the mold

We’ve come together to celebrate you, the dynamic mold breakers who are propelling forward to a brighter future for us all. You are visionaries who launch and reimagine businesses, employ millions and endow your communities, leaving legacies of accomplishment and enrichment while setting the pace for generations of entrepreneurs to come.

We salute the finalists being honored this year and congratulate the award winners!

Craig Glazier
Partner and East Central Program Director
EY

 

 


Quick links:

WINNERS: Ron Leonhardt,CrossCountry Mortgage, Inc. | Alex Matseikovich, Craig Sturgill & Rodolfo Marrero,Excel Impact, LLC | Bill DeVille, Lair Kennedy & Ty Nelson, Health Carousel | Brady Duncan & Kenny McNutt, MadTree Brewing | John Leehy III, Payment Alliance International | Steve Smith, Plus Consulting, LLC | Joey Rivera, Rivera Group | Brian Yeager & Michelle Yeager-Thornton, The Champion Companies | Tim Svarczkopf, Tight Rock Solutions LLC

FINALISTS: Arria Hines, Allegheny Science & Technology | Tillie Hidalgo Lima, Best Upon Request | Steve Huey, Capture Higher Ed | David Eldridge & Mike Kane, cellhelmet | Teresa Hack, Channel Products | Andy Kline & Yoel Mayerfeld, Chase Properties | Greg Ubert, Crimson Cup Coffee & Tea | John Saxon, dlhBowles | John Anoliefo, Famicos Foundation | Ken Ganley, Ganley Auto Group | Anthony Sanzo, Net Health | Kevin Hickey, Online Stores LLC | Ed Kenty, Park Place Technologies | Gino and Barbara Faciana, Pleasant Valley Corporation | Kumar Buvanendaran, PRIME AE Group, Inc. | Rich Ward, WARDJet, Inc. | Joe Ferrara, Wombat Security Technologies, Inc. | Scott Zemba & Steve Zemba, Zemba Holdings, Inc. | Walter Lynch, Zipline Logistics


Winners

Ron Leonhardt
President and CEO
CrossCountry Mortgage, Inc.
Brecksville, Ohio

Nominated by: Michelle Novak, CrossCountry Mortgage, Inc. and David Ferguson, Merrill Corporation

 

Ron Leonhardt started CrossCountry Mortgage, Inc., in 2004, and in less than 15 years it has expanded from one branch in suburban Cleveland to 185 across the U.S. As president and CEO, he had the vision to become a national full-service lender that could meet customers’ needs and make their dream of homeownership a reality.

When Leonhardt founded CrossCountry, he brought in his mom, his aunt, two friends and hired a processor. They are now among the 1,300 people the company has grown to employ, which is more than double what it was just two years ago.

Over the life of the company, it has faced several significant challenges, given the cyclical nature of the industry in which it operates. Most notably are the mortgage crisis of 2008, an increasingly strict regulatory environment and challenges from larger competitors. However, CrossCountry has always been profitable and has never had to lay off employees. Leonhardt at times is overstaffed with the intention to grow his business to fit his workforce.

CrossCountry is an innovator. The company has streamlined its closing process to 21 days. Further, the company provides fast-track credit approval and its underwriting turn time is 48 hours or less. Leonhardt attributes his success to embracing rather than resisting change. He pursued a more aggressive strategy in 2009, in the middle of the mortgage crisis. While the majority of his competitors were struggling to survive, the strategy helped the company grow.

Despite the company’s rapid growth, it still has a unique small business feel. Leonhardt is a hands-on leader, and his involvement in the mortgage business trickles down throughout the company. He is a visible presence in the office and greets new hires personally, getting to know them on a personal level.

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Alex Matseikovich, CEO
Craig Sturgill, President and co-founder
Rodolfo Marrero, CTO
Excel Impact, LLC
Medina, Ohio

 

Finding that the insurance industry lacked efficient, effective and trustworthy methods for consumers to get connected with insurance agents and carriers, Craig Sturgill, Alex Matseikovich and Rodolfo Marrero came together with a solution. They founded Excel Impact, LLC, an online customer acquisition firm with a focus on the insurance industry. It’s a platform that connects consumers with the best agency that can serve their needs and offer tailored products and services.

CEO Matseikovich, President and Co-founder Sturgill and CTO Marrero believe that the quality of a lead is more important than the quantity of leads. They strive to create partnerships rather than simply sell.

The Cleveland-area company has an auction-based cost structure in which clients place bids on pings — excerpts of leads, such as zip code or birthdate — and Excel Impact selects the highest bid while considering the compatibility of the product for the consumer. The way this “ping-and-post” methodology has been implemented by Excel Impact is designed for enhanced value creation by associating its data research into distribution.

The company performs extensive data research to not only provide leads, but also to optimize them and ensure quality. The success of leads is continuously analyzed by obtaining multiple relevant data points from clients. It evaluates the status of all leads monthly and then uses the data to strategize and improve the quality it provides to those same clients.

Excel Impact places its customers first, and believes that if it always does right by its clients, money and success will follow naturally. Although the co-founders of Excel Impact feel they have achieved significant milestones as their business climbs to new heights every year, they are looking forward to more expansive and rapid growth in the coming years.

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Bill DeVille, CEO
Lair Kennedy, Chairman
Ty Nelson, President
Health Carousel
Cincinnati, Ohio

Nominated by: Dan Flanigan, Bannockburn Global Forex

 

CEO Bill DeVille, Chairman Lair Kennedy and President Ty Nelson have combined their unique talents while leading Health Carousel. In a market sometimes known for taking advantage of health care professionals for profit, especially overseas, the leaders were determined to instill their vision for a company that improves lives by making health care work better.

In 2006, the U.S. changed nurse immigration, inserting a five-year delay into the process of deploying foreign-trained health care professionals. This had a devastating financial impact on companies like Health Carousel, and many exited the market. During these difficult years, the founders doubled down on the international division, sponsoring as many nurse visas as possible.

Today, the Cincinnati company employs more than 800 foreign-trained health care professionals and is among the largest international health care staffing companies in the U.S. The company was recognized as the nation’s seventh-fastest growing health care staffing firm in 2017.

Health Carousel’s international staffing service, Passport USA, has long-term assignments of 36 months, which provide greater revenue visibility. The company is one of a few international staffing businesses with scale because of the significant barriers to entry. Similarly, the company became a top 20 travel nursing company when it acquired two other travel nursing businesses.

Health Carousel has a low attrition rate and grew the employee headcount from 90 to more than 440 over the past two years. The cornerstone of attracting and building talent lies in developing a magnetic culture. The company invested in benefits, such as platinum-level health insurance, Health Carousel University and an employee award system. It also takes time to celebrate company and employee milestones, and its offices have billiard tables, shuffleboard, walking desks and wellness rooms for nursing mothers.

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Brady Duncan
Kenny McNutt
Co-founders
MadTree Brewing
Cincinnati, Ohio

 

MadTree Brewing’s roots stem from Kenny McNutt’s beer-of-the-week club with some Cincinnati neighbors, including Brady Duncan. The crew would brew beer and invite young professionals over to connect.

Once the co-founders left their Fortune 500 companies to focus on MadTree full time, they quickly realized they were responsible not only for brewing the beer, but also accounting, human resources, sales and more.
As the craft brewery has grown from 1,000 to 27,000 barrels of beer, the duo has continued to be visible and approachable. MadTree opened a new taproom and brewery in 2017, which allowed the company to triple its production with room to grow.

McNutt and Duncan are proponents of ensuring employees control their career path. They treat the employees fairly, so those employees will treat management fairly in return. For example, a sales representative missed her goal for the quarter; while Duncan was willing to give her the bonus, she declined it in order to be accountable.

They also train all employees, from the packager to brewers, in the product’s taste. By putting in chemicals for their employees to taste the difference, they learn to identify problems either from ingredients or process.

Over the last four years, MadTree has seen tremendous growth. The pair is trying to better manage that, such as taking a deliberate approach when MadTree expands into new markets like Nashville. McNutt and Duncan also don’t want to lose sight of the need for quality and consistent beer. They invested heavily in a testing lab and have recently started to allow outside breweries to send samples for testing.

The company also hosts a Chef’s and Brewer’s Series to encourage chefs or brewers to experiment. These collaborations have created several beers, such as Rubus Cacao, a raspberry chocolate stout brewed with chocolate from a local company.

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John Leehy III
President and CEO
Payment Alliance International
Louisville, Kentucky

Nominated by: Gregory Carroll, PNC Bank, NA



President and CEO John Leehy III has started multiple businesses over the past two decades, fueling an entrepreneurial passion that has culminated in Payment Alliance International.

PAI has more than 75,000 ATMs, with plans to expand to 100,000 in the next few years. One out of every three retail ATMs in America is processed by PAI, making it the largest, privately-held ATM provider in the U.S. With the largest sales network in the ATM transaction processing industry, PAI touches every part of the “cash cycle” and is the industry’s most fully-integrated provider, serving merchants, consumers, financial institutions and ATM wholesalers.

The company also has successfully completed 43 acquisitions during the past decade, and seven in the last year alone.

The Louisville, Kentucky, company continues to lead its industry. PAI was first to deliver important advances on its nationwide ATM fleet, including cardless transactions via smartphone access, foreign currency conversion, charitable donations, and the PAI Beacon Network, a low-energy bluetooth beacon technology that delivers location-based consumer incentives directly to consumers’ smartphones. A customer might go to an ATM and be instantly recognized and personally greeted. Or, an ATM in a grocery store would recognize which bank a customer uses and change the settings to match.

As the company grows, Leehy strives to ensure PAI does not fall into the pit of big business. He believes in hiring the right people and employs the BBQ Test — hiring people who he would want to have at a house BBQ party. The company recently rolled out its PAI Armored Services Business, and in the coming months, it will expand its Alliance Funding unit — leasing, vault cash, small business lending, etc. PAI also plans to accelerate the pace of its acquisition of North American-based ATM businesses during 2018 and 2019.

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Steve Smith
CEO
Plus Consulting, LLC
Carnegie, Pennsylvania

Nominated by: Jason Wolfe, Wolfe, LLC



Plus Consulting, LLC is led by its CEO Steve Smith. On his own since age 15, Smith worked his way through high school and college, an experience he credits in helping to develop his tireless work ethic. After a period working in the ski industry and barely making ends meet, Smith decided to pursue his MBA at Carnegie Mellon University and started his career at Andersen Consulting.

Transferring the sales skills he honed working in a ski shop, Smith immediately stood out from his peers due to his strong management and selling skills. After stints at EY and Coopers & Lybrand, at the age of 29, Smith was formally accepted into the partnership admission process at PwC. After being told that he was too young and would have to wait five more years, Smith thanked the interviewer and immediately quit.

Within weeks, he started Plus Consulting. Taking the skills he learned at multiple leading companies, he created a firm with a focus on serving as a trusted business adviser and aligning business objectives with technology solutions.

Describing his team as “the MBAs of technology,” he believed he could serve customers with more entrepreneurialism and make it more affordable. Establishing himself as a thought leader in the industry, Smith has consistently adapted Pittsburgh-based Plus Consulting to emerging technologies and predicted popular trends, enabling sustained growth.

Crediting strong mentorships with enabling his success, Smith has created a culture of mentorship for his employees to enable them to thrive. He empowers his team to be successful by providing them with every tool possible to ensure their clients’ success. Smith is quick to point out that his people are his most valuable asset, and he has created the right culture and environment for them to thrive.

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Joey Rivera
President and CEO
Rivera Group
Louisville, Kentucky

 

At a young age, Joey Rivera learned the importance of leadership, endurance and responsibility when he joined the Marines at the age of 17 as a result of an order by a judge, which was a turning point in Rivera’s life. The Marines supplied him with structure and a sense of mission that led him to earn his GED and take charge of his future.

As Rivera would say, “there was no intent to build a company” when he was doing various consulting jobs in the early stages of his career. The growth occurred organically with his clients recognizing the valuable skill set and drive that Rivera possessed. As the jobs grew to be more than he could handle on his own, he began to hire additional help and thus became Rivera Group.

At the beginning, the Sellersburg, Indiana-based company offered professional consulting business services. One day, Rivera’s mentor, David Jones Sr., said that his professional consulting business was not scalable both in terms of talent and leadership. Rivera reflected on this advice and it became an eye-opener for him as he realized that Jones was correct.

Instead of trading “time for money,” Rivera, who serves as president and CEO, took Jones’ advice and began to see his company from a new perspective. He started thinking of scalability on the front end, which led to the transformation of the company from a professional services business to a software development company.

The transition “was brutal,” as Rivera said, as all the earnings from the consulting services were being reinvested into software development with unknown outcomes. It was, and continues to be, important to Rivera that the company has been “debt free since day one,” using retained earnings and working capital to continue to reinvent the business.

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Brian Yeager
President and CEO
Michelle Yeager-Thornton
Co-founder and COO
The Champion Companies
Westerville, Ohio

Nominated by: Geoff White, Frost Brown Todd



The Champion Companies was founded in 2010 when Brian Yeager and Michelle Yeager-Thornton purchased their first apartment complex. They made this purchase at a time when the real estate market could not have been worse and they needed a multi-million dollar loan to close the deal. This required each of them to take second mortgages on their homes, borrow money from family members and have full personal liability for any debt they acquired.

After numerous rejections, they received their first loan because the investor knew them as individuals who have knowledge of the industry and a strong work ethic. They got their start in real estate by doing property management to pay for college. The work ethic and personal responsibility they developed during this time made them into the successful and generous entrepreneurs they are today.

Brian and Michelle each have different, but complementary leadership styles. Brian is the president, CEO and visionary for the Westerville, Ohio-based company. He sets the plan three to five years down the road, making deals and determining what properties to sell and buy. As co-founder and COO, Michelle is on the ground making sure Champion is operationally sound. She is the reason every customer relationship starts with “Hello” and there is nothing she asks of anyone that she would not do herself.

The greatest challenge they believe their company faces is the highly competitive nature of the real estate market. In order to keep up with fast-paced market changes, Brian and Michelle know they cannot be complacent. They have invested in an improved revenue management system and environmentally friendly technology to stay on the leading edge and meet changing customer expectations. Their hard work has allowed their single mother to retire early and tripled the net worth of Brian’s blue-collar father-in-law.

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Tim Svarczkopf
CEO
Tight Rock Solutions LLC
Canonsburg, Pennsylvania

Nominated by: Ray Gevaudan, Comtech Industries, Inc.

 

While Tight Rock Solutions LLC is not truly a family business, it is certainly run like one. Tim Svarczkopf leveraged relationships with close business partners over the years to create a company that would fulfill his vision of providing a mathematical and laboratory-proved set of chemicals that would maximize exploration and production operator performance.

Headquartered in Canonsburg, Pennsylvania, Tight Rock has approximately 12 employees, including business partner Dean Grose and his son, Jason Grose, who have been with the company since inception in 2015. This tight-knit group has begun something special in its pursuit of enhancing America’s energy capabilities.

Svarczkopf’s entrepreneurial spirit as CEO has been evident ever since he was a student at Hanover College in Indiana. As a student there, he knew he wanted to be a part of creating energy independence for the U.S. He graduated in four years with a double major in geology and chemistry, the only person to have done so at Hanover at the time. From there, he drew on his inherent desire to solve problems.

Svarczkopf believes entrepreneurs have to be willing to fail, or learn how not to do things. This personal ownership of being able to solve problems is what has driven him throughout his career. From figuring out how to reuse fracking water during his time working in North Dakota as a young professional to creating a specialized set of chemicals at Tight Rock, his passion for and ability to solve problems has shown through.

By creating an improved process for extracting oil and natural gas commodities within the Appalachian region, Tight Rock is doing its part to create energy independence. Tight Rock’s product and service offerings are completely original and have not been duplicated by any other company at this point.

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Finalists

Arria Hines
President and CEO
Allegheny Science & Technology
Bridgeport, West Virginia

Nominated by: David Ferguson, Merrill Corporation



Arria Hines identified an opportunity to deliver customized IT and energy services to government clients through relationships created when working for NASA. Based on reputation, relationships and trust, Hines launched Allegheny Science & Technology, a technology and energy consulting firm, with only three employees. She was able to win multiple government contracts with agencies, such as the Department of Defense and Department of Energy.

However, just as Hines, the company’s president and CEO, was gaining traction with AST, the government shut down, which caused cash and business to dwindle. Hines and her management team tried to shield employees and protect the business from the impact of the temporary challenge.

Management took on debt and pay cuts, while becoming proactive with how they managed spending. When the shutdown was over, AST had not only survived, but had also become a stronger company because of it. Today the company, headquartered in Bridgeport, West Virginia, has about 200 employees across the U.S., is debt-free and still independently owned.

AST seeks to recruit the highest-preforming talent that also fits within the company’s open culture, one with a relaxed work environment that offers the flexibility to have a great work-life balance.
Hines also believes that empowering and developing her employees drives quality in the services the company performs. People development opportunities include schooling, certifications, trainings and diverse experiences on different clients.
The company’s efforts have paid off in both the outstanding services delivered to clients, which has resulted in many new contracts and extensions, and the “exceptional” ratings employees give in their contract performance assessment reports.
Hines’ culture of quality, trust and hard work has enabled the company to maintain customers and forecast 10 percent growth per year over the next several years.

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Tillie Hidalgo Lima
President and CEO
Best Upon Request
Cincinnati, Ohio

Nominated by: E. Todd Wilkowski, Frost Brown Todd LLC



Tillie Hidalgo Lima has poured every bit of herself into Best Upon Request, a full-service, on-site concierge service for employees and hospital patients.

As president and CEO, she has taken the female-owned and operated, Latina-run, family business to new heights. Educated in pharmaceutical studies, she operated a successful pharmacy for years until her husband, Dave, asked her to join Best, the company he started in 1993. Lima began managing all operations, ingraining herself in the business, learning each role and gaining technical expertise in a wide array of skill sets.

In the early 2000s, the Cincinnati, Ohio, company lost its largest client due to an IPO and a continued state of apprehension in the business community brought on by the Sept. 11 attacks. Best almost went out of business. It was then that Dave asked his wife to take over the business. Lima created opportunities in the health care vertical, adding a service to assist patients and their families during their stay at the hospital, navigating the sector’s regulatory framework to do so.

She also added a new service, maternity concierges, aimed at providing new and expecting mothers with services that assist them with research, planning and managing the responsibilities of a new parent.

Lima has grown Best into a full employee services benefits suite and brought other family members into the business, including her daughters who each actively manage a portion of the business. Jessica, the owner of the maternity concierge service, holds the title of vice president of marketing and communications; and Natalie, whose role is as a people developer and talent finder, holds the title of vice president of human relations.

Lima has a knack for taking on challenges and embracing difficulties, knowing that intense pressure and time turns a grain of sand into a pearl.

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Steve Huey
CEO
Capture Higher Ed
Louisville, Kentucky

Nominated by: Tony Thompson, PNC Bank, NA

 

With 23 times more applicants than students needed to fill a college class, Steve Huey sought a better way to find the right students to fill the right classrooms. In 2011, he co-founded Capture Higher Ed in Louisville, Kentucky, to do just that.

While competitors were adding more call centers and direct mail vendors to market to more students, Capture Higher Ed developed innovative software to assist universities to target and capture the “right” student pool during the recruitment and application process.

In 2014, the company acquired a data analytics firm and its CEO —  a doctorate in behavioral science — to form the start of an internal data science team. Capture Higher Ed then developed a marketing automation software product called Capture Behavioral Engagement and predictive modeling software called Envision with three unique programs that reflect the university application process.

The quick growth of the company’s client base is a testament to the efficacy of the software that Huey and his team have developed. However, never settling for the status quo, the company, of which Huey is CEO, has expanded beyond the initial software products and offers a plethora of new services, including digital marketing services and survey information services. It has also expanded its products and services to graduate programs, law programs, online programs, alumni giving programs and more.

Huey and his team brought the mix of behavioral technology and data science to a nonprofit industry. The innovative software that he and his team developed has room to grow and improve to adapt to constantly changing technological standards.

Combining marketing and behavioral methods in the nonprofit industry helps universities better serve the needs of prospective applicants, creating an efficient and accurate prediction of which students will be the right ones for the right university.

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David Eldridge,President
Mike Kane, Founder and CEO
cellhelmet
Sewickley, Pennsylvania

Nominated by: Brian Dandrea, PNC Bank, NA



In 2011, Mike Kane began an eBay business to buy and resell phone accessories. When he was processing over 300 transactions on his day off, Kane took the next step. He developed his own brand, cellhelmet, a registered trademark of Kane & McHenry Enterprises, LLC.

By constructing an indestructible phone case and pairing it with a warranty for accidental damage to the phone while it was in the case, the founder and CEO essentially created an insurance plan. This novel idea landed a spot on ABC’s “Shark Tank.” Although Kane and his team left without receiving an investor offer, they caught worldwide attention, including David Eldridge’s.

Eldridge operated 18 Verizon Wireless stores throughout the Pittsburgh area. In 2013, Eldridge, who became president, purchased half of the company and applied his experience to further develop the brand.
Competing in an oversaturated market, gaining traction in the industry was difficult, personally and professionally, for Kane, who sacrificed paychecks for almost four years. But he never lost his passion and it paid off.

Today, cellhelmet manufactures 250 SKUs that are distributed to over 2,000 retail stores. The company has evolved to produce a variety of cellphone accessories, including screen protection products, chargers, data cables and cleaning solution.

As cellhelmet launches new products in a rapidly changing environment, the company has encountered hurdles. It first launched its liquid screen protector to the market without proper age testing. When customers reported a problem, Kane, Eldridge and the cellhelmet team spent two months working on recalls and searching for an alternative supplier. Despite the costly mistake, cellhelmet adapted quickly and retained most of its customers.

Preparing for three large product launches in 2018, the company expects to more than double its revenue over the next five years. cellhelmet is one of Pittsburgh’s up and coming manufacturers.

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Teresa Hack
President and CEO
Channel Products
Cleveland, Ohio

Nominated by: George Carson, The Carson Group



Teresa Hack was working as a consultant for the Weinberg Capital Group, a private equity firm, when it acquired Channel Products, which invents and manufactures component systems and technologies designed for the gas appliance industry. She was tasked with finding ways to improve the company, but soon learned of the long odds she was up against.

Hack uncovered serious problems with management, product quality, the financial statements and the corporate culture. The Cleveland company was losing its three largest customers and the culture was largely characterized by fear and unwillingness. Dishonesty about the financial information led the company to the verge of bankruptcy, and investors were prepared to write off the company entirely.

In a meeting with her bosses at WCG soon after, the team determined that the solution was to replace the president. Hack volunteered.

In one of her first moves, Hack made a strategic decision to place as much emphasis on culture as she placed on sales, financial management and performance. Immediately, she provided her team with a level of autonomy that other executives might consider a risk in the early stages of a turnaround. She reconstructed Channel’s cultural foundation, targeting specific purposes designed to make Channel a better place to work and to enhance its brand.

Targeting culture and sustainability has led to a 98 percent quality performance rating and a less than 2 percent employee churn rate during Hack’s time leading the company as president and CEO.

Hack’s entrepreneurial mindset has enabled her to make changes, see results and make a difference. She has a passion for people, and a love of development and success. She lives by the idea of not managing people, but leading people while managing the process. These pillars have been instrumental in the turnaround of Channel.

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Andy Kline
Yoel Mayerfeld
Co-CEOs
Chase Properties
Beachwood, Ohio

Nominated by: John Mark Tichar, Oswald Companies



Co-CEOs Andy Kline and Yoel Mayerfeld are responsible for the day-to-day operations of Chase Properties, one of the foremost owners of open-air shopping centers in the U.S. Since taking the reins in 2011, they have transformed the business and have grown by expanding the services it offers clients.

The Cleveland company owns 30 properties in 17 states throughout the Northeast, Midwest and Southeast U.S. Chase uses strict criteria when analyzing potential properties and the types of tenants it might go into business with.

The real estate market can ebb and flow, depending on many factors. Chase, however, has been able to continue growing and succeeding throughout various economic cycles because of its investment philosophy of buying high-quality real estate in smaller, tertiary markets and having national and regional brands as tenants.

For example, most of Chase’s 30 properties are located miles away from larger metropolitan areas, but are still in high-traffic towns with relatively high population density. By choosing to purchase open-air shopping centers in these areas, many of their tenants’ stores at these properties are the only location within 50 to 100 miles.

Kline and Mayerfeld have implemented an ownership mentality among the company’s employees. When they first took the lead, they conducted interviews with employees to determine the strengths and weaknesses of how the business was currently being run and ways they could improve the culture.

They discovered many employees felt like they did not have a seat at the table for decision-making and wanted a more collaborative approach to business. Kline and Mayerfeld took what they learned and reshaped the company’s core values by giving employees more autonomy. This paid dividends not only from a financial perspective, but it has also enabled employees to feel like more valued members of the team.

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Greg Ubert
Founder and president
Crimson Cup Coffee & Tea
Columbus, Ohio

Nominated by: Cheryl Claypoole, Claypoole Communications

 

Greg Ubert was a Harvard University graduate working at a computer software company in Chicago. He was nagged by the idea of finding better-tasting coffee and a better way to make it. That’s when, in 1991 at the age of 23, he moved back to Columbus, Ohio, and started Crimson Cup Coffee & Tea.

He began experimenting with different beans and talking to people in the coffee industry, learning the business and changing his techniques as he continued to grow. Ubert was focused on the experience of the coffee and everyone who touches it from bean to cup.

At Crimson Cup, Ubert, the company’s president, has developed a strong customer base of local coffee shops through training and support programs. He invests in these local businesses by sharing his company’s coffee expertise for free, which helps customers become more knowledgeable and skilled in the coffee industry.

The training can be at the customer’s site or at Crimson Cup’s Innovation Lab. Here, employees experiment with different techniques and products, testing out new concoctions. Coffee professionals can use the lab to learn different brewing, drink preparation and roasting techniques.

Ubert is also impacting farmers by working to understand their specific farms, the people in the villages and the challenges they face so that he can support each farmer to ensure his or her continued success, which enables them to support their families and communities. He has provided business training to some local farmers that has improved profitability, and has signed multi-year contracts with some farmers, which has enabled them to better plan their production.

Crimson Cup’s retail spaces focus on bringing the bean-to-cup experience to consumers in a minimal space that emphasizes the drink rather than the décor. Currently, there are four retail locations with plans to expand within Ohio.

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John Saxon
CEO
dlhBowles
Canton, Ohio

Nominated by: Jerry Lynott, Oswald Companies

 

John Saxon leads dlhBowles, a manufacturer of air and fluid delivery systems for the global automotive market, by building the right team. Describing his leadership style as openly hostile, he surrounds himself with people who think differently and encourages them to challenge his ideas.

Attracting and retaining top talent are fundamental to the company’s success. Seeing that one of the organization’s greatest deficiencies was its lack of a career path for its workers, including its engineers, Saxon directed the company to invest in its human resources department to position itself for growth. This has led to more incentivized workers and less turnover.

The economic downturn of 2008 was a significant challenge for dlhBowles because of its impact on the automotive industry. Revenues of the Canton, Ohio, company dropped significantly and two of its largest customers filed for bankruptcy only weeks apart. Saxon, the company’s CEO, reduced dlhBowles’ workforce and his compensation to absorb the hit.

Despite these challenges, he continued to put company resources into research and development. Specifically, Saxon was able to recognize a shift in industry trends toward using lighter plastic components in vehicles, instead of heavier rubber and metal materials. The move paid off and the company emerged from the recession income neutral and cash flow positive. Because the company had new products and procedures in place to meet the automotive industry’s demand of lighter, plastic components, business was soon booming.

Saxon’s focus on innovation contributed to dlhBowles’ success following the recession. Today, the company continues to focus on diversifying its product lines. Seeing another shift in the automotive industry toward autonomous vehicle technology, Saxon has the company placing an emphasis on in its R&D in this area.

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John Anoliefo
Executive Director
Famicos Foundation
Cleveland, Ohio

Nominated by: Sharon Francz, Taylor Oswald

 

John Anoliefo arrived in the U.S. as a teenager from Nigeria, intending to make a difference in the lives of others in need. As executive director of the Famicos Foundation, Anoliefo and his colleagues do just that by providing affordable housing, everyday necessities and other services to those in need within the Glenville, Ohio, community.

Anoliefo prides himself on the ability to maintain a clean image and reputation and set an example. Not only did he move to Glenville upon accepting his position in 2002, he has also raised his kids and continues to live and worship in Glenville.

While Famicos was well-known within the community, his new role wasn’t without challenges. His predecessor at Famicos exhausted all funding and the organization was borrowing money from a local bank to meet payroll. Anoliefo drew on a similar experience he had at his prior position to rebuild Famicos’s finances and create a mix of investors and funding sources.

One of Anoliefo’s concerns is the potential for employees to become discouraged as they fight against poverty. Anoliefo implemented year-end bonus checks, organized gatherings at Cleveland sporting events and ticket giveaways, implemented birthday celebrations, and has provided financial support to those with unexpected life-changing events. As a result, employee morale significantly increased, turnover is low and the employee base has grown from 17 people to approximately 42.

Where possible, Anoliefo prefers to hire employees and recruit board members from within the neighborhood. For example, Famicos targeted local teenagers to employ as part of its landscaping service, which cleans up plots of land left empty after the demolition of vacant homes. This provides a source of income, promotes responsibility and work ethic in young adults, and most importantly, provides an alternative to young adults that otherwise join street gangs and commit violent crimes.

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Ken Ganley
CEO
Ganley Auto Group
Brecksville, Ohio

Nominated by: Molly Carpenter, Smart Business Network

 

Ganley Auto Group was founded in 1968 by Ken Ganley’s father, Tom Ganley. Ken started washing cars and sweeping floors at age 12. He worked up to the sales floor by age 16 and began selling cars. Even while away at college, he worked at a small Toyota dealership. Ken then used the money he earned throughout high school and college to buy into the family business. At 21, he partnered with his father to open and operate his first dealership in Akron, Ohio.

Ken quickly learned that he had to change the culture. He wanted to get rid of the stigma of used-car salesmen “nickel and diming” the customers and create a more enjoyable customer experience. The idea was that the right experience would not only help them sell more cars, but also keep customers coming back for car maintenance, car parts and body shop services, which are generally more profitable.

Ken first approached his father to determine what dealerships were struggling so that he could implement his model to confirm it would work. The dealerships had increased car sales and profitability in a matter of months. Knowing they had the right formula, Ken and Tom rolled out the model to all of the Ganley dealerships.

Training continues to be important today. Ken opened a training center for employees to complete mandatory training for their respective levels, such as all new hires completing a two-week class prior to coming into the business.

Ken also learned he could grow the business exponentially by acquiring distressed assets/dealerships, implementing the Ganley model and turning them around. In 2008, when Ken took over as CEO, Ganley had 12 dealerships. Today, Ganley has 37 dealerships and is actively seeking more opportunities. It expects to reach more than 2,000 employees by the end of 2018.

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Anthony Sanzo

Chairman and CEO
Net Health
Pittsburgh, Pennsylvania

Nominated by: Patrick Colletti, Net Health

 

Anthony Sanzo has had two careers: 19 years as a hospital administrator and 19 years as an entrepreneur.

As COO of Allegheny General Hospital, an aggressive plan to expand the hospital’s reach into Philadelphia wasn’t going as planned. The hospital spread itself too thin, and Sanzo brought this to the attention of the board. Although he was reluctant, Sanzo accepted the offer to become CEO of the failing hospital. He led it through bankruptcy and restructuring, which Sanzo describes as the worst 14 months of his professional life. Little did he know, this set the foundation for his second career.

In 1999, Sanzo founded Transition Management Group, a small consulting firm that leveraged his experience. As Sanzo took on clients such as TeleTracking and Net Health, he became so valuable, he was brought in as an employee of both companies.

But even starting his own business wasn’t as challenging as the turnaround of Net Health. Founded in 1997, like many young companies, it faltered during its first few years. Sanzo became chairman in 2001 and set Net Health back on course, identifying the one product worth focusing on. Wound Expert today has two-thirds of the market share for wound care electronic health records.

In 2011, Sanzo stepped in as CEO to bring liquidity to the investors within a year. In a matter of months, Net Health was acquired by a private equity firm.

Over the last few years, the Pittsburgh company — which has grown to 50 employees and serves a client base that treats patients in over 3,000 hospitals, outpatient centers and skilled nursing facilities — has been acquired by another private equity firm. Sanzo convinced these new investors to take the long view and develop “xfit,” a platform that can support all of Net Health’s products, not just Wound Expert.

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Kevin Hickey
CEO
Online Stores LLC
New Stanton, Pennsylvania

Nominated by: David Ferguson, Merrill Corporation

 

Online Stores LLC was started by CEO Kevin Hickey and his wife, Lisa, in 2001. It began as an online flag sales company. Today, Online Stores prides itself on being both a merchandising and a technology company.

Lisa’s brother, John, joined the company six months after it was operational in what was expected to be a temporary role. Sixteen years later, John acts as the head of day-to-day operations in the No. 2 leadership role, behind Hickey.

Hickey’s management philosophy is greatly influenced by the family business aspect of Online Stores. He takes care of his employees and their families through competitive pay, flexible work arrangements and family health benefits. As Hickey puts it, “Nobody should be penalized for having a family.”

The online merchandising company specializes in niche products and markets, such as LED lighting, flags, safety clothing and equipment, and chimney piping. Online Stores also manufactures some of its products, like flags, and acts as a technological innovator by designing its IT systems to sell products. Hickey sees the company’s IT structure as its strongest aspect. With his background in software engineering, Hickey took a hands-on approach to designing the company’s IT configuration in the early days. Today, he’s more involved on a conceptual level.

Online Stores currently has about 135 employees and has begun an apprenticeship program that Hickey hopes to extend to local area high schools.

Online Stores operates in the same landscape as such retail giants as Amazon and Walmart. To compete with these entities, Online Stores focuses on how to increase online search engine traffic and differentiate itself. Its internal customer service department fields over 1,000 calls per day from its New Stanton, Pennsylvania, location. In addition to customer service, Online Stores creates innovative tools that help customers find products and use those products subsequent to purchase.

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Ed Kenty
Chairman and CEO
Park Place Technologies
Cleveland, Ohio

Nominated by: David Ferguson, Merrill Corporation

 

Park Place Technologies, an enterprise hardware service provider, has found an attractive niche. The majority of post-warranty service coverage is provided by the original equipment manufacturers. These OEMs have a split focus: Their primary goal is to drive customers to replace their existing hardware by purchasing new equipment, rather than providing cost-efficient, quality service for legacy hardware. Under the leadership of Chairman and CEO Ed Kenty, PPT offers warranty and hardware coverage for data centers after the initial manufacturer’s warranty.

The company also has invested in and services all major platforms. That way, any change by a single manufacturer is unlikely to have a material impact on PPT’s performance.

Globalization offers the most significant opportunity for PPT. In the past five years, Kenty has prioritized global markets. He’s focused on expanding into the European and Asia-Pacific regions.

Kenty is also laser focused on recruiting, retaining and developing talent. Rather than seeking sales personnel with five- to 10-years’ experience, Kenty has found PPT is able to more effectively mentor a newly graduated workforce, control quality and offer consistent methodology across the sales team. These personnel enter a six-month training program in its Cleveland-area office that involves extensive skill-building exercises, technical training and shadowing. When individuals do not show an aptitude for the more social side of sales, PPT tries to place them within other parts of the business. Once an individual has completed the entry training, they’re placed in a region, and existing salespeople contribute a portion of their accounts. This gives the new salesperson an easier transition.

Additionally, PPT has a strategy of always looking internally when promoting. When expanding products or regions, the company gives an existing employee the opportunity to lead the expansion, which enhances quality, culture and brand consistency.

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Gino and Barbara Faciana
Co-CEOs
Pleasant Valley Corporation
Medina, Ohio

Nominated by: Melanie Holman, Oswald Companies

 

Gino and Barbara Faciana met, got married and started their first business, Pleasant Valley Corporation, in 1976. With $500 in their pocket, they started working as electrical contractors and began their journey into entrepreneurship. They both believe in a business family, not a family business. According to Barbara, a family business is one in which the patriarch is the CEO “because he says so.” A business family is run more like a board of directors. Everyone’s opinion matters and all major business decisions are put to a family vote.

As the second generation of their family started to join the firm, Gino and Barbara, who serve as co-CEOs, felt it was important to hire a family business counselor to help them work through the daily tribulations of being a business family. They used this experience to advantageously position their business while also growing stronger as a family.

Gino and Barbara gave their children ownership interests in the Medina company and created an infrastructure where no son or daughter answers to another. Each child is the head of his or her own division, which they are responsible for growing and managing.

During the process of building out their business model to include a second generation, they reworked the structure more than once. In doing so, their family business became a business family — transitioning their daily reality into a strategic business advantage.

Gino believes that each member of the second generation adds innovative ideas and technology that drive the entrepreneurial spirit of the company, while maintaining the business and family values they find so important. They have taught their grandchildren, who are 12 years old and younger, to start their own business. This third generation of PVC runs the Swag Shop, where they bring coffee and cookies to employees’ desks for 15 cents per delivery.

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Kumar Buvanendaran
President and CEO
PRIME AE Group, Inc.
Columbus, Ohio

Nominated by: Molly Carpenter, Smart Business Network

 

Since 2011, Kumar Buvanendaran has fully immersed himself into PRIME AE Group, Inc., creating an environment in which PRIME is truly his family. He has set forth standards and expectations to enable his staff to view their relationships the same way and commit 100 percent of themselves to this family. Buvanendaran has personally served in every role at the company, ranging from marketing coordinator to project manager to now president and CEO.

From the foundational and core understanding of each role’s value in the Columbus company, he is able to demonstrate and excel at his current leadership role. He believes in taking risks and feels that if risks are not taken, nothing will ever change to improve the company.

He has an insatiable appetite for growth and a strong level of perseverance. He believes in himself and his staff and their ability to work together to make PRIME a successful business. Buvanendaran’s tagline is that he will not take no as an answer, and he believes there is always a way to win. He regularly preaches this to his team to encourage them to take risks and push the status quo.

Buvanendaran openly conveys his support to employees and maintains an open door policy around communication with executives. He embraces failure as a learning experience and an opportunity for the business to grow from its mistakes. Buvanendaran makes sure that his employees know that he is available 24/7 if they ever need anything. He takes work calls in the evenings and on weekends to ensure all of his employees have the support necessary to properly perform their job.

He believes that building trust is one of the most important things within any business, and strives to be a leader rather than just a boss.

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Rich Ward
President
WARDJet, Inc.
Tallmadge, Ohio

Nominated by: Josh Fragoso, Oswald Companies

 

Rich Ward came to the U.S. to pursue an opportunity to run a stone company. He moved to Cleveland with his wife, Helen, and two young children with no money in his pocket and hardly any belongings. He and his family moved into a small apartment that they furnished with items from garage sales and other people’s garbage. After only 16 months in Cleveland, Ward lost his job. Fortunately, this was not the end of Ward’s career; instead, it was the beginning of his pursuit to transform the waterjet cutting business.

Ward decided early on that WARDJet, Inc. would run differently than any other business. One example of its uniqueness is how the Tallmadge, Ohio-based company approaches maintenance services. WARDjet gives a lifetime guarantee for its waterjets, and all maintenance is done remotely. When a customer calls with an issue, a ticket is automatically filed and a support technician remotely assesses the problem.

Also, every waterjet has a QR code that the customer can scan to get information on the machine — from instructions to machine parts. Ward decided to handle maintenance this way to avoid the cost of wasted technician time and travel. As part of this remote maintenance program, WARDjet has a lean, but efficient support staff that quickly solves the waterjet issues of the world through modern connective technology. An astounding 94 percent of all problems are fixed within four hours of the customer’s initial call.

The company differentiates itself from competitors by being the only manufacturer to offer custom machines that solve complex problems. Many times, Ward has sold an idea of a machine before he has even constructed it. As automation increases, and with the value of customized machinery, WARDjet has secured its market position as the only niche competitor in customized waterjets.

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Joe Ferrara
President and CEO
Wombat Security Technologies, Inc.
Pittsburgh, Pennsylvania

Nominated by: Rich Lunak , Innovation Works & Riverfront Ventures

 

Before taking his position at Wombat Security Technologies, Inc., Joe Ferrara knew he wanted to make a major career shift — from an established public company to a startup. Ferrara describes himself as an individual who becomes bored easily. Taking on a startup was just the challenge he was looking for to satisfy his entrepreneurial passion.

Ferrara was fascinated by the innovative idea of educating people on cybersecurity threats that the three founders of Wombat had developed. The founders were full-time Carnegie Mellon University computer science faculty members who were unable to devote the time to advance the product to the potential that Ferrara could see in the Pittsburgh company.

After gaining the founders’ trust, Ferrara took over the company as employee No. 4 and would disrupt the industry by providing software as a service based information security awareness and training products into new market segments with capabilities that their traditional competitors did not know or understand. Ferrara’s exceptional visionary leadership, seeing two to three years ahead of the market, helped the product to become the market standard. Wombat’s products continue to push innovation ahead of its competitors.

Ferrara, who serves as president and CEO, did not build his team to more than 220 employees by plucking new graduates from surrounding universities who majored in technology fields. Rather, he reached out to established individuals he had previously worked with or those he personally knew and trusted to refer others. His philosophy is that if you treat people right, regardless of their experience and educational background, anything can happen. Ferrara follows through with that attitude not only by behavior, but by each employee’s benefit package. Further, he ensures that all employees receive stock options upon hiring, which has been rewarding to all employees after the recent acquisition by Proofpoint.

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Scott Zemba
Co-founder and CEO
Steve Zemba
President
Zemba Holdings, Inc.
Zanesville, Ohio

Nominated by: Robert Zab , Manchester RBG

Zemba Holdings, Inc. is recognized as one of Southeastern Ohio’s largest excavation companies with a wide offering of other services. However, it’s a company that was built upon humble beginnings. It was founded and is led by Scott Zemba, co-founder and CEO, along with his brother Steve, who is president.

Scott and Steve were taught at an early age the value of a dollar and strong work ethic. When asked what they find most rewarding in being a family business owner, Scott and Steve quickly agreed that it is the pride of where they started and how far they’ve come.

Starting by mowing lawns as teenagers, the foundation of the company was established upon the brothers’ tendency to accept and take on any job requested of them. At a young age, the brothers took on work to make enough to survive, but Scott explained that the reward is not the money. Rather, it’s the pride of making something of themselves and establishing a generational business from the ground up.

Steve says that the company doesn’t hire people solely to fill a job. They hire people to be a part of their family. Zemba Holdings now employs 92 people, and Scott emphasized that none of them will ever be just a number. This has established a competitive advantage for the company, which has dominated the market in which it serves.

Despite the growth of the company, Scott and Steve still define and measure its success by the impact that they’re able to have on their people and on the community. As they have transitioned out of day-to-day operations and into executive roles, they’re able to see the growth of their team and of each individual on the team.

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Walter Lynch
CEO
Zipline Logistics
Columbus, Ohio

Nominated by: Bethany Cramer, Zipline Logistics

 

Walter Lynch comes from a family of entrepreneurs and while he did not expect to become one himself, he knew how hard it was to start a business and the potential failure that could occur. After college, Lynchand his brother, Andrew, decided they wanted to start a business together. Lynchworked for Lehman Brothers Holdings and other financial institutions while Andrew worked for a logistics company.

They were dissatisfied with the quality of service that was being delivered to the customer and felt they could do it better. Lynch suggested that he, Andrew and two other founding members start their own logistics company. While Andrew and the two other gentlemen knew how to execute on the day-to-day operations of a logistics company, Lynch could focus on the financial and strategy aspect of the business.

They launched the Columbus business in 2007, and for the first five years, Lynch had a day job. He traveled frequently and carried a portable printer with him to print checks for the business in the evening. During these early years of the company, he worked in the background managing the partnership, finances and legal aspects of the business. This continued until 2012 when he joined Zipline Logistics full-time as CEO.

Zipline is strategic with talent management and invests heavily in its team. Leadership 411 is an advanced leadership training program geared toward sales and senior positions, while Emerging Leaders Group is for newer staff. Outside of the official leadership training programs, the company emphasizes career mentoring focused on coaching employees through various career topics. Lynch also created an innovation lab, which was originally for employees to submit feedback for technology improvement. This has since expanded into process improvements with an overall goal to enhance productivity.

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Judges

 

Deborah Rogan
Bellwether Enterprise Real Estate Capital

 

 

 

Rod Robinson
ConnXus

 

 

 

Jeff Broadhurst
Eat’n Park Hospitality Group

 

 

 

Greg Conley
HFF, Inc.

 

 

 

Brad Sacks
More Than Gourmet

 

 

 

Leigh Radford
Procter & Gamble

 

 

 

Aaron Grossman
TalentLaunch

 

 

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P&G CEO switch will not lead to big strategy change: CFO

CINCINNATI, Fri May 24, 2013 — Procter & Gamble Co. said on Friday the surprise return of A.G. Lafley as chairman and chief executive was not an indication of any bigger problems at the world’s largest consumer products maker.

Lafley replaces Bob McDonald, effective immediately, at P&G, which is in the midst of a major restructuring.
“This change very simply reflects Bob McDonald’s decision to retire and the board’s view that A.G. Lafley was currently the best person to replace Bob and build on the momentum that Bob has initiated and led,” Chief Financial Officer Jon Moeller said on a very brief conference call for analysts on Friday morning.
The CFO said there would not be any dramatic change in strategy due to the switch in CEOs.
The announcement late Thursday was “not indicative of any kind of bigger problem or financial issue,” he said.
Shares of P&G rose to $81.90 in premarket trading after closing at $78.70 on Thursday, before the decision was announced. P&G, the maker of Tide detergent and Gillette razors, did not give a specific reason for McDonald’s departure other than to say that he is retiring. McDonald is 59 and Lafley is 65.
Moeller was the only speaker on the call and he did not take questions from analysts.
He said P&G, which maintained its financial guidance as it made Thursday’s announcement, will continue to focus on maintaining its momentum in developing markets and strengthening its core developed market business, and that the company continues to be “optimistic.”

 

P&G forecasts profit below Street, shares drop

CINCINNATI, Wed Apr 24, 2013 — Procter & Gamble Co. on Wednesday forecast current-quarter profit below Wall Street expectations and year-ago levels, sending shares 3.5 percent lower in early trading.

The world’s largest household products maker also posted fiscal third-quarter profit that topped estimates despite sales that were weaker than both the company and analysts had anticipated.

P&G has been trying to reinvigorate itself under Chief Executive Bob McDonald. The company has held or gained market share in more of its businesses in the latest quarters after stiffer competition from rivals like Unilever and Colgate-Palmolive Co.

While products such as Tide Pods have boosted U.S. sales, P&G still needs to figure out the formula for getting products such as Pantene shampoo to stand out among competitors, it said. P&G plans to promote several brands during the current quarter, including Olay skin care products.

Net sales decreased in the hair care and skin care business in the latest quarter.

“We’ve got a little bit more work to do” in skin care, McDonald told reporters.

In February 2012, McDonald unveiled a $10 billion restructuring plan including thousands of job cuts after P&G acknowledged it was not nimble enough, especially in emerging markets.

Shares of P&G fell to $79.65 in premarket trading after closing at an all-time high of $82.54 on Tuesday

P&G shows turnaround taking hold with results, outlook

CINCINNATI, Fri Jan 25, 2013 — Procter & Gamble Co.’s (PG.N) quarterly profit soared past expectations as the world’s largest household products maker used higher prices and new products to drive sales growth, the strongest indication yet that turnaround efforts are paying off.

The results, along with improved forecasts for the fiscal year, follow months of criticism from analysts and most notably from activist investor William Ackman, who blamed P&G’s top brass, led by Chairman and CEO Bob McDonald, for earlier missteps.

Shares of P&G, the maker of Pampers diapers and Gillette razors and a component of the Dow Jones industrial average jumped to $71.84 in premarket trading from Thursday’s close of $70.42.

The results, with profit and sales ahead of analysts’ expectations, come after months of P&G trying to reignite growth in sluggish markets such as the United States while also expanding in emerging markets, where it typically sells lower-priced merchandise.

Back in April 2012, analysts took McDonald to task on a tense conference call after P&G cut its outlook. That summer, Ackman’s Pershing Square Capital Management bought the company’s shares and began pushing for more change.

Profit has exceeded analysts’ expectations every quarter since, helped by new products such as Tide Pods single-dose laundry detergent.

Procter & Gamble soars past profit expectations

CINCINNATI, Thu Oct 25, 2012 – Procter & Gamble Co.’s profit rose more than expected, indicating that the world’s largest household products maker is making progress after coming under pressure from activist investor William Ackman, and its shares soared to the highest level in four years.

Rival Colgate-Palmolive), meanwhile, said it plans to cut about 6 percent of its workforce over the next four years as it strives to operate more nimbly as economies slow in many countries. Its quarterly profit matched expectations.

Several consumer goods makers are trimming jobs, including P&G, as concerned consumers hold off on some purchases and growth slows in major markets such as China.

P&G is on track to cut 4,200 jobs by the end of October on its way to eliminating 5,700 jobs by the end of its fiscal year. On Wednesday, Kimberly-Clark Corp. said it would eliminate 1,300 to 1,500 jobs as it leaves some low-margin businesses in Europe. Colgate’s plans, including moving away from single-country units toward regional hubs, should lead the toothpaste maker to trim about 2,300 jobs by the end of 2016.

Shares of P&G rose 4 percent to $70.83 on Thursday, their highest level since October 2008. Colgate’s shares fell 2.9 percent to $103.44.

“It wouldn’t surprise me if we’re seeing some people saying it is time to sell some Colgate, buy some Procter, given Colgate’s outperformance year to date,” said JP Morgan analyst John Faucher, who has a “neutral” rating on Colgate and an “overweight” rating on P&G.

Colgate’s shares had risen 15 percent this year through Wednesday, while P&G shares were up less than 1 percent.

Procter & Gamble CEO defends plan at staid shareholder meeting

CINCINNATI, Tue Oct 9, 2012 – Procter & Gamble Co.’s CEO stood behind the company’s plan for increasing profit and sales at a drama-free annual meeting notable for the absence of William Ackman, the activist investor who has pushed hard for change in recent months at the world’s largest maker of household products.

Chief Executive Bob McDonald defended the strategy of developing major new products while the company at the same time seeks to cut $10 billion in costs.

Tuesday’s meeting, held in P&G’s hometown of Cincinnati, came as something of a respite for McDonald months after Ackman’s Pershing Square Capital Management took a stake in P&G, putting pressure on the CEO and the board to improve performance.

McDonald, who has been at the helm since July 2009, is refocusing on core categories, countries and innovations with both the $10 billion restructuring and a strategy laid out in June that homes in on the company’s 40 biggest businesses, 20 biggest new products and 10 key developing markets.

Ackman, who disclosed his stake in the maker of Tide detergent and Crest toothpaste too late to have any proposals on the agenda, was not in attendance, and only one shareholder referred to him, asking why it took the investment of an activist to boost P&G’s stock.

“If we remain focused on the plan I talked about, the 40/20/10 plan, with improved innovation from discontinuous innovation, with productivity improvement, then we are all convinced that shareholders will get an increase in value and the stock will reflect that,” McDonald replied, without mentioning Ackman directly. “We are focused like a laser, we are holding our own feet to the fire to do this.”

P&G CEO’s pay down 6.1 percent after tough year

CINCINNATI, Fri Aug 24, 2012 – Procter & Gamble Co. Chairman and CEO Bob McDonald took home a little less last year after disappointing results that he is trying to reverse with a major overhaul.

McDonald, the leader of the world’s largest household products company since 2009, earned nearly $15.2 million in the year ended in June, down 6.1 percent from $16.19 million in fiscal 2011, according to a filing P&G made with the U.S. Securities and Exchange Commission on Friday.

P&G, whose brands include Pampers, Gillette and Tide, is in the midst of a $10 billion restructuring. On top of that, activist investor William Ackman bought roughly $1.8 billion worth of its stock this summer. While Ackman has not yet pushed for any changes at the company, P&G’s board came out in July in support of McDonald and his turnaround plan.

In June, P&G took the blame for a lack of big new products and not cutting costs fast enough as demand slows in some major markets. McDonald said it would take time to reverse the negative trends and that he expected little improvement in fiscal 2013, which began on July 1.

McDonald’s salary was flat in fiscal 2012 at $1.6 million. With 89 percent of his total pay tied to the company’s performance, his overall payout declined as P&G’s results came in below target. His bonus fell by $200,000, to $2.43 million.

Most of McDonald’s compensation comes in stock and option awards. Their combined value fell 8 percent to $10.85 million.

Shares of P&G were down 0.3 percent at $66.49 in early trading. The shares fell 3.6 percent to $61.25 during fiscal 2012.

Procter & Gamble profit tops forecast, plans buybacks

CINCINNATI, Fri Aug 3, 2012 – Procter & Gamble Co. posted a higher-than-expected quarterly profit despite a drop in sales, just weeks after the world’s largest household products maker took the blame for its disappointing performance and said it was focusing on ways to improve.

The results, released on Friday, are being watched closely for any early signals of how well P&G and its current leadership can fix a long list of problems, especially after activist investor William Ackman stepped in and bought about $1.8 billion worth of its shares.

The maker of Pampers diapers and Tide laundry detergent said it had talked with Ackman’s Pershing Square Capital Management, but did not divulge details of those discussions.

“We have a dialogue with Pershing just as we do with all investors, but of course we keep the content of these discussions confidential to protect the interests and proprietary thoughts of our investors,” CEO Bob McDonald told reporters on a conference call on Friday.

P&G also said it would repurchase $4 billion worth of its shares this fiscal year. In June it said it did not expect to do so because it wanted to preserve its credit rating.

CFO Jon Moeller said P&G changed its mind because it had growing confidence in its turnaround plan and more cash on hand than it had anticipated in June, while interest rates continued to fall.

Procter & Gamble cuts outlook for year; restructuring under way

CINCINNATI, Fri Apr 27, 2012 – Procter & Gamble Co. lowered its profit expectations for the year on Friday as it works on its new restructuring plan and continues to feel some pressure from higher commodity costs.

Shares of P&G fell 2 percent to $65.55 in premarket trading.

The world’s largest household products maker posted a lower quarterly profit, weighed down by charges for its restructuring, which calls for eliminating 5,700 nonmanufacturing jobs and cutting $10 billion in costs by the end of fiscal 2016.

The maker of Pampers diapers and Gillette razors earned $2.41 billion, or 82 cents per share, in the third quarter ended in March, compared with $2.87 billion, or 96 cents per share, a year earlier.

Core earnings per share, which exclude items such as restructuring charges, were flat at 94 cents. The results topped analysts’ expectations of 93 cents, according to Thomson Reuters I/B/E/S.

Sales rose 2 percent to $20.19 billion.

P&G said it now expected to post core earnings per share of $3.82 to $3.88 this year. Back in February, it had forecast $3.93 to $4.03 for the year ending in June.

P&G outlined its restructuring plan in February.

The human side of the performance equation

Nancy Gipson, Jackson plant manager, Pringles

A few years ago, Procter & Gamble’s Pringles plant in Jackson, Tenn., had an enviable reputation. The plant produced and distributed all of Pringles’ products in North and South America and the Asia-Pacific Region. The plant had received P&G’s highest certification, awarded for superior discipline and best work processes and practices. Its performance in all aspects of the business – production, delivery, service, quality and safety – was spectacular. In short, the plant was a shining star in the P&G family, performing at a world-class level.

It would have been easy to rest on their laurels. But for Nancy Gipson, plant manager, great wasn’t good enough. She was convinced they could do even better. She took action to further lean the plant’s best practice standard operating procedures.

As part of her efforts to further lean the operations, Gipson conducted a safety assessment. She came to the realization that not all safety incidents were being reported, because employees didn’t want to jeopardize the plant’s prized certification.

This realization was sobering to Gipson and the plant leadership team. Although the safety numbers were very impressive, Gipson wanted to improve them even more based on the assessment implications. And she wanted to ensure that no incident would ever go unreported again.

Upon closer review, the safety work processes were found to be solid and as lean as they could be without investing a ton of money for minimal returns. So Gipson turned her attention to the plant’s culture and individual behavioral practices. She found inconsistencies and tremendous variation within the workforce when it came to how they performed the safety processes on a day-to-day basis.

With Bright Side’s help, led by partner Chad Cook, Gipson and her colleagues came to understand that even the best processes rely on individual discretion and decision-making. In other words, work processes have a fundamental human component that increases variability and risk of failure. To significantly reduce lean process variability, Gipson and her team didn’t need to focus on the tasks being performed; they needed to focus on the human factor.

In order to ensure that the human or behavioral aspect was better integrated with work processes, Bright Side and P&G focused on three strategic behaviors:

1.   Transparency. The focus here was on creating a climate of trust where people could feel free to tell the truth, since reliable data about safety depends on people reporting what is really happening. At the same time, employees were helped to understand that safety holds a higher priority than productivity in the eyes of leadership. Maximizing production is not more important than safety when it comes to making decisions on the floor.

2.   Shared leadership and accountability. Safety is the responsibility of all employees. Employees were engaged to take responsibility and be accountable for their own individual safety and the safety of others over and above just following the safety processes.

3.   Business, self-rationalization. Employees were encouraged to actively engage their brains when making decisions rather than robotically following processes. The outcome is that they keep themselves and others safe while achieving the business plans and outcomes.

By intentionally modeling these behaviors, leaders proved that they believed in, were committed to and were taking the behaviors of safety seriously. Employees could see and hear in their behaviors that leadership was sincere about these changes, and that led to greater trust on all sides. With consistent and constant leadership, these behaviors took hold on the floor and throughout the plant.

The long-term impact has been exactly what Gipson originally sought: the plant has become an even greater model of success in its safety processes and beyond. The plant is measurably safer, has reduced costs, increased efficiency, reduced turnover, expanded production and improved quality. Employees, their families and leadership feel secure that people who work in the plant will leave work as healthy as when they arrived. On a recent tour, an exec from outside P&G remarked, “I have been to many facilities in the food industry, and you set the standard for any I have ever visited.” The plant is now expanding their behavioral strategies to intentionally encompass every work process in the facility.

Our work with Pringles demonstrates what Bright Side endorses and delivers: to significantly improve performance and get a magnified return on investment, organizations need to find the balance between both the task and behavioral aspects of getting work accomplished. Many companies mistakenly believe that focusing exclusively on tasks is the solution for everything. They think they can infinitely improve processes and competencies by working harder. But the reality is that once you have removed most of the waste from a system or process, you get minimal benefit from continuing to focus on tiny gains in task improvement. A lean task focus has its limits.

The REAL, leverage-able opportunity for improvement then comes from a conscious and intentional focus on the human/behavioral side of getting work done, as the Pringles case study illustrates. It’s only when companies really commit to exploring and improving leadership engagement focused on strategic behaviors (actions, words, beliefs and assumptions) that productivity, consistency and effectiveness rise off the charts.

If you are already on the journey to lean your organization, don’t neglect the human/behavioral component. Expand your thinking to add the behavioral side of the performance equation to your current lean tools and processes.

Donna Rae Smith has forged a career, enterprise and an applied discipline on the practice of teaching leaders to be masters of change.  She is the founder and CEO of Bright Side Inc., a transformational change catalyst company with an emphasis on the behavior-side of change.  For more than two decades, Donna Rae Smith and the Bright Side team have been recognized as innovators in executing behavioral strategies coalesced with business strategies to accelerate and sustain business results. Bright Side®, The Behavioral Strategy Company, has partnered with over 250 of the world’s most influential companies.  For more information, please visit www.bright-side.com or contact Donna Rae Smith at [email protected]