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Get a Grip on Your Family Business: Are you running your business or is it running you?
(Editor’s Note: This is the 11th column in a series by family business leaders and advisors with information and ideas about topics unique to family businesses, developed in conjunction with the Conway Center for Family Business.)
By Alex Freytag
In many family businesses, entrepreneurial leadership teams have similar frustrations: lack of control, people issues (need we say more), lack of profit, nothing is working, or you’ve hit the ceiling and can’t break through.
This is often caused by misalignment within the leadership team of a family business; that is, they’re not all 100 percent on the same page with where they are going and how they are going to get there. In other words, they don’t agree on their strategy or vision.
If this sounds familiar, a simple, practical tool called the Vision/Traction Organizer or V/TO will help you clarify and simplify your strategic planning process and at the same time, help you gain traction towards achieving that goal. Why is traction an important part of your strategic planning process? As we like to say, vision without traction is hallucination.
The V/TO simplifies the strategic planning process; it asks leadership teams to answer eight questions and to have complete alignment, clarity and agreement on the answers to those eight questions. As you read them, ask yourself if you truly and honestly have complete agreement and alignment throughout your organization.
- What are Your Core Values? To be clear, these are not permission-to-play values such as integrity or trust, nor, are they aspirational values such as accountability. Core values should embody who you are as a company; they are what makes you different, wacky—they are what you reek of.
- What is Your Core Focus? What is your passion and what is your niche? Disney’s is “To make people happy.” Your reason for being should be a short sentence or phrase using simple language.
- What is Your 10-Year Target? Are you all shooting for the same thing down the road? Ask a leadership team of five this question and you will often get six different answers. So how can an organization determine what priorities are important if it doesn’t know where it is going?
- What is Your Marketing Strategy? What is your “list”—your ideal customer? What are your three uniques? What is your proven process? What is your guarantee?
- What is Your Three-Year Picture? Define 3-5 key measurements (e.g. revenue, profit, # customers) that you want to hit in three years. Then, describe what the organization looks like in 5-10 short, descriptive bullet points. You’ve just completed your three-year plan.
- What is Your One-Year Plan? Define 3-5 key measurements you want to hit in the next 12 months. Then add your 3-7 goals for the year. Note: the more goals you have, the fewer you will accomplish.
- What are Your Quarterly Rocks? A rock is just another term for a 90-day priority. The key here is to create a 90-day world. Why? People tend to lose focus after 90 days so every 90 days, review your rocks and set new ones.
- What is Your Issues List? Once you have your issues on a list, you can prioritize and start to solve those issues.
Once a leadership team has complete alignment and clarity on these simple eight questions, your organization will begin to identify and effectively solve all your issues. And your success at achieving your vision is directly proportional to your ability to solve issues.
Alex Freytag is co-founder and partner at ProfitWorks LLC. ProfitWorks helps organizations clarify, simplify and achieve their vision by implementing The Entrepreneurial Operating System, which can be downloaded for free at www.eosworldwide.com. Alex can be reached at email@example.com or 614-571-8826.
It’s not your imagination. Pumpkins are popping up everywhere these days and in all kinds of creative uses. Beyond the pumpkin pie and pumpkin ice cream are pumpkin-flavored coffee and tea and even beer and ale. You can moisturize your skin with pumpkin body butter and burn pumpkin pie-scented candles.
From a business perspective, pumpkins are a limited and seasonal crop, but Ohio consistently ranks in the nation’s top five pumpkin producers.
In the past 10 years, Ohio’s pumpkin harvest has grown from a $10 million crop in 2003 to over $15 million last year. Pumpkin acres harvested in Ohio have increased from 4,000 in 2003 to 6,100 in 2013, fourth behind Illinois, Pennsylvania and Michigan, respectively, according to data from the United State Department of Agriculture’s National Agricultural Statistics Service.
Nationally in the last 10 years, pumpkin production has risen from an $80.2 million business to one valued in 2013 at nearly $150 million.
Ohio’s premier pumpkin event kicks off this week just south of Columbus. The Circleville Pumpkin Show, which dates to 1903, begins Wednesday and runs through Saturday.
CEO Insights recap: Jeni's CEO John Lowe talks basketball, secrets to success
A sold out crowd attended the October edition of the Columbus Chamber’s CEO Insights forum this morning at Dawson. (Columbus CEO is a proud presenting sponsor, fyi.) The big draw? Ice cream. Or more specifically John Lowe, CEO of Jeni’s Splendid Ice Creams. In case you missed it, Jeni’s growth from small business to mid-size manufacturer was the subject of our cover story this month and Lowe’s leadership has certainly contributed to that growth.
You can look for our extended Q&A with Lowe in this Sunday's Columbus Dispatch. Meanwhile, here are some of our favorite CEO Insights from Lowe:
To learn more about the December CEO Insights event, visit the Columbus Chamber here.
GUEST BLOG: WHY CAREERS IN MANUFACTURING DESERVE A SECOND LOOK
By KENNY MCDONALD
The first Friday in October serves as national Manufacturing Day, and here at home, October marks Ohio Manufacturing Month. Economic development agencies throughout the Columbus Region and the state share a common goal of raising awareness of modern manufacturing as a viable career choice for both adult job seekers and students starting to evaluate their futures. Just 30 percent of parents encourage their children to pursue a career in manufacturing, and we want to change that.
Why manufacturing is important
There is a perception among some that manufacturing is not a desirable career, but the truth is it’s one of the fastest growing industries, both in skilled and non-skilled jobs. The Columbus Region is home to 1,800 manufacturing establishments that make everything from helmets to ice cream and boast 80,000 employees in manufacturing-related careers. Columbus manufacturers experienced a 36-percent increase in work productivity between 2001 and 2013, proving that the industry is becoming more technology driven, and our area’s manufacturing workforce is talented and hardworking.
However, 67 percent of U.S. manufacturers report a moderate to severe shortage of available, qualified workers—leaving high quality jobs on the table. Manufacturers have the highest job tenure in the private sector and 90 percent of manufacturing workers have medical benefits. Manufacturing jobs also pay more. In 2012, the average manufacturing worker in the United States earned $77,505 annually, including pay and benefits. The average worker in all industries earned $62,063. In the Columbus Region, manufacturing salaries are 23 percent higher than the average for all other industries. For those seeking a lucrative career that provides a variety of career paths, manufacturing is the answer.
Manufacturing in the Columbus Region
The Region has proven itself as an ideal spot for manufacturing success. Goods made in the Columbus Region are easily transported to domestic and international markets via the Region's multi-modal logistics infrastructure, reaching 45 and 33 percent of the U.S. and Canadian populations, respectively, and 44 percent of the U.S. manufacturing capacity within a 10-hour drive. Export opportunities for Region manufacturers include Cargolux and Cathay Pacific's cargo flights between Columbus and Hong Kong, and a number of export resources from counseling to financing also exist for Region manufacturers.
For companies looking to expand or relocate, the Columbus Region offers a competitive tax structure, and Ohio is ranked No. 3 for lowest effective tax rate on both new capital-intensive manufacturing operations and new labor-intensive manufacturing operations. Additionally, the Region offers greater value for industrial space than peer metros like Chicago, Dallas and Indianapolis.
What’s being done to fill the gap
Throughout the month of October, Columbus 2020 and economic development partners will focus on touting the benefits of manufacturing as a career. As part of that effort, companies throughout the state are opening their doors to high school students and the public to give them a firsthand look at the types of jobs available. Companies interested in getting involved are encouraged to visit ColumbusRegion.com/manufacturingmonth for more information.
In addition to job opportunities, it’s important to note the resources available in the Columbus Region to effectively train tomorrow’s workforce. Ten career and technical schools offer industrial vocational training, such as the cutting edge programs at RAMTEC (Robotics & Advanced Manufacturing Technology Education Collaborative), and several four-year colleges and universities offer degrees in manufacturing, including The Ohio State University's nationally ranked production/operations program.
The proof that manufacturing is a viable, growing career opportunity is present—evidenced by the number and types of jobs available, as well as the ideal business climate created through a strategic infrastructure system and competitive tax structure. This month, join the Columbus Region’s economic development partners in shedding light on these positives and helping to steer bright minds to fulfilling careers that will keep them in the Buckeye State.
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Kenny McDonald is chief economic officer with Columbus 2020. Columbus 2020 serves as the economic development organization for the 11-county Columbus Region, with a mission to generate opportunity and build capacity for economic growth throughout Central Ohio. See ColumbusRegion.com
Grange's chief property and casualty officer to succeed retiring CEO
Columbus-based Grange has announced John Ammendola, the company's chief property and casualty officer, will succeed retiring CEO and President Tom Welch. Ammendola will begin leading the insurance provider--with $2 billion in assets and more than $1 billion in annual revenue--on the first of the year. The details from yesterday's announcement:
Tom Welch, 62, president and CEO of Grange Insurance, announced today that he will retire January, 2015 and concurrently, the Grange Insurance Board of Directors announced the election of John Ammendola, 48, executive vice president and chief property and casualty officer, to assume the president and CEO position effective January 1, 2015.
Welch has been with Grange Insurance since 2001 when he joined as president of the Grange Life Insurance Company and later served as vice president and chief financial officer until being named president and CEO in 2011. Under Tom’s leadership Grange’s surplus exceeded $1 billion – a first in the company’s 79-year history.
“Tom’s leadership over the past few years has been invaluable in guiding Grange to becoming a high performing company. Although I am saddened to see him leave, I am pleased he is taking the time for himself and his family. On behalf of the entire board, I’d like to thank him for his contributions and leadership,” said Board Chairman David Wetmore.
“When Tom was elected as president and CEO we agreed that developing the next generation of Grange leaders and ensuring an orderly CEO succession were among our highest priorities,” Wetmore said. “We are thrilled to have someone as exceptional and well-respected as John to lead Grange into the future.”
Ammendola joined Grange in 2010 as president of personal lines and became chief property & casualty officer in 2013. Under his direction, the personal lines business returned to profitable growth and the company began to diversify its portfolio through continued investments and growth in its commercial lines business.
Ammendola’s record of building and leading high performing teams in the industry includes serving as senior vice president of sales and marketing at Kemper Insurance Company. He also successfully served as senior vice president of finance and strategy at Safeco Insurance Company after leading Safeco’s personal lines business as senior vice president. Ammendola started his insurance career with GEICO, where he served in claims, sales and underwriting leadership roles.
“It is an honor and privilege to have the opportunity to lead Grange and our independent agency partners into the future.” Ammendola said. “Under Tom’s leadership, we have started on the important journey of becoming a high performing company. My commitment is to build on that success. I’m looking forward to what the future of Grange will bring.”
Guest Blog: How Promoting from Within Can Help Your Company
By Colleen Rains
How does a company create itself to be “built to last”? The organizations with staying power figure out ways to keep the years of knowledge, relationships and context within the workforce. This bank of wisdom is invaluable – and critical for companies to retain even as employees come and go. Even the most thorough transition processes fail to retain some of the mission-critical intellectual assets. So, what are you doing to preserve this wisdom wealth?
Promoting from within is one key solution. Consider existing employees to fill open positions before going outside the organization. Internal advancement provides a wide range of benefits, including:
Employee satisfaction and loyalty. Organizations that invest in their workforce see lower turnover rates, higher employee satisfaction scores, and improvements to safety and performance. Internal advancements validate an organization’s faith and confidence in the existing teams. Employees who receive an internal advancement build trust in the organization. They appreciate and acknowledge the company’s commitment to the workforce. High levels of trust build loyalty and dedication to the organization.
Less risk. When promoting from within, managers know what to expect from that employee based on their track record. As the newly promoted individual learns higher-level duties, he/she can rely on existing relationships with co-workers and mentors to receive support and coaching. Not sure if someone is quite ready for a promotion? Try assigning a few higher-level duties to see how they perform. This “test drive” builds confidence in the management team and the individual ahead of the actual promotion.
Retention of “Wisdom Wealth.” Employees all have unique knowledge sets based on past project involvement and individual experiences with the company. This specialized knowledge can help an organization improve products, processes, profits and services. Deeply aware of company capabilities, limitations, management, goals and customer or client needs, a long-standing employee has historical perspective that can drive results.
For internal advancement to be successful, structured programs should be incorporated to help employees grow and advance in their roles. Three methods to consider as you commit to internal advancement:
Individual Development Plans (IDP). An effective IDP acknowledges what skills the employee has mastered and provides a clear roadmap for what the employee needs to do to prepare to take the next step in their career, including opportunities to test and prove new skills (think Stretch Assignments).
Mentoring. In a formal or informal structure, a mentoring relationship can provide specific career education, training and development. Remember: the best way to prove mastery of knowledge is to teach it, so also consider engagements when the mentee must “mentor up” and give information, not just be the recipient of others’ knowledge.
Coaching. The best coaching arrangements are detailed with measurable outcomes before the start of the coaching session. The person being coached must be committed to the process including preparation and completion of assignments during and between sessions in order to achieve the full benefit of the coach.
Promoting from within can help your company heighten employee satisfaction and loyalty, retain critical wisdom wealth and endure less risk; in other words, be Built to Last. Be courageous and invest in the skills of current employees. Showing your willingness to support internal growth and engage employees in the future of your company is a win-win all around.
Colleen Rains has served as Director of Human Resources at Elford, Inc. for nearly 15 years. She was recognized as Executive of the Year (Small Organization) in 2013 by Columbus CEO for proving that great HR employees and great companies go hand in hand.