Prairie Business July 2018

MOVING FORWARD by giving back

Employee Stock Ownership Plans benefit executives, companies and employees

ALSO:

CORPORATE COMMUNITIES

Special section outlines companies’ successful recruiting and retention initiatives

HAL GERSHMAN, PRESIDENT AND CHAIRMAN OF THE BOARD HAPPY HARRY’S BOTTLE SHOPS. GRAND FORKS, N.D.

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EDITOR’S NOTE

THE CORPORATE VERSION OF MINNESOTA AND NORTH/SOUTH DAKOTA NICE BY TOM DENNIS

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ECONOMIC DEVELOPMENT

AMONG THE COMPANIES THAT HAVE TRANSITIONED TO AN EMPLOYEE STOCK OWNERSHIP PLAN IS GAGE BROTHERS CONCRETE PRODUCTS IN SIOUX FALLS, S.D. SHOWN HERE IN A RENDERING IS THE COMPANY’S NEW PLANT, NOW UNDER CONSTRUCTION.

IMAGE: JLG ARCHITECTS

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CORPORATE DEVELOPMENT

ESOPS FOR BEGINNERS FOR COMPANIES THAT SET UP EMPLOYEE STOCK OWNERSHIP PLANS, IT’S ALL ABOUT “WE”

FIRST LOSE, THEN WIN ENTREPRENEURS TALK ABOUT THE ROLE FAILURE PLAYED – AND PLAYS – IN THEIR SUCCESS

IN THIS SPECIAL MAGAZINE-WITHIN-THE-MAGAZINE, COMPANIES OFFER THEIR BEST RECRUITING AND RETENTION TIPS

HAL GERSHMAN, PRESIDENT AND BOARD CHAIRMAN AT HAPPY HARRY’S BOTTLE SHOPS IN GRAND FORKS, N.D., SOLVED THE PROBLEM OF SUCCESSION BY SETTING UP AN EMPLOYEE STOCK OWNERSHIP PLAN.

IMAGE: NICK NELSON/FORUM NEWS SERVICE

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WORKFORCE TRAINING

BUILD DAKOTA: SOUTH DAKOTA’S SCHOLARSHIP PROGRAM HELPS EASE THE STATE’S WORKFORCE SHORTAGE BY DENI AMUNDSON

A Q&A WITH BRIAN JOHNSON, CHOICE FINANCIAL CEO

ONE WORD: IN THE WORLD OF ECONOMIC DEVELOPMENT, THAT WORD IS LEADERSHIP BY PAUL LUCY INNOVATION

HIDDEN STRENGTH: THE MIDWEST AS A HOTBED OF TECH INNOVATION AND RESEARCH? BELIEVE IT BY JOEL HONEYMAN

PB LOOKS

Stories affirm region’s high quality of life

Is it possible to buy stock in a region? If it is, then sign me up for shares of the Midwest, because I’m convinced the region’s prospects are good.

Here’s a line from a Prairie Business story this month that helps explain why:

“(T)he greatest number of ESOPs –about 32 percent of the nation’s total – are found in the Midwest.”

ESOPs, as Lance Nixon’s story explains, are Employee Stock Ownership Plans, a way for benevolent owners to transfer ownership of their company to employees. The word “benevolent” is key, because while setting up an ESOP does confer tax advantages, it’s both costly and daunting, leading CNN Money to conclude, “Most owners willing to go to the trouble of implementing such a plan have the interests of their employees and the business in mind.”

Midwesterners should be proud that their region is home to the highest concentration of such owners. And in my view, that stat is a selling point. Ambitious but family-minded workers already are drawn to the Midwest, in part because they know they’re likely to find not only good jobs but also work/life balance. Expect that migration to continue as the 21st Century rolls on.

Want more proof? Look at the benefits on display in Corporate Communities, our special section this month. Here a partial lineup from Lemonly in Sioux Falls, S.D.: Work anywhere, flexible scheduling, summer hours, five-year adventure bonus, annual continuing education allowance, 100 percent coverage of hardware/ software, holiday gifts. All that and profit sharing, too.

It’s great to live in a place where even the employers practice Midwestern Nice.

Good reading, Tom Dennis

I welcome your feedback and story ideas. Call me at 701-780-1276 or email me at tdennis@prairiebusinessmagazine.com.

PUBLISHER KORRIE WENZEL

AD DIRECTOR STACI LORD

EDITOR

TOM DENNIS CIRCULATION MANAGER BETH BOHLMAN

LAYOUT DESIGN ANNA HINSVERK

ACCOUNT MANAGERS

NICHOLE ERTMAN

800.477.6572 ext. 1162 nertman@prairiebusinessmagazine.com

JENNIFER LEROUX OLSZEWSKI

800.477.6572 ext. 1167 jlolszewski@prairiebusinessmagazine.com

Prairie Business magazine is published monthly by the Grand Forks Herald and Forum Communications Company with offices at 375 2nd Avenue North, Grand Forks, ND 58203. Subscriptions are available free of charge. Back issue quantities are limited and subject to availability ($2/copy prepaid). The opinions of writers featured in Prairie Business are their own.

Unsolicited manuscripts, photographs, artwork are encouraged but will not be returned without a self-addressed, stamped envelope.

SUBSCRIPTIONS

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ADDRESS CORRECTIONS

Prairie Business magazine Box 6008 Grand Forks, ND 58206-6008

Beth Bohlman: bbohlman@prairiebusinessmagazine.com

ONLINE www.prairiebusinessmagazine.com

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The one-word formula for civic growth and success

By Paul Lucy

FARGO, N.D. – I have been asked many times, “What is it that makes some communities’ economic development programs more successful than others?” Is it the level of available financial resources or the result of hiring an experienced economic development professional?

Is it because the community has a comprehensive strategic plan?

After nearly 30 years of experience working with communities all across North Dakota, I have seen significant differences in economic development strategies and how they are implemented.

And over the years, we have seen shifts in demographics, workforce, and economic conditions, resulting in major changes to

communities’ strategic priorities and ways of measuring success.

But as much as some things have changed, other things have stayed the same. And when you look at communities where there is true economic and community development success, there is one condition that is always present.

The one key factor that’s required for positive change is leadership.

Leadership is the most vital component for successful community development, regardless of a community’s size, location, financial wherewithal or strategic priorities.

I could identify specific people or groups who have stepped up in their community to bring about positive change. But for the sake of brevity, I will focus on a few outcomes that have resulted from this irreplaceable factor of leadership.

LUCY,

• The development and expansion of UND Aerospace at the University of North Dakota in Grand Forks to make the program one of the premier flight training programs in the world, and to position North Dakota as a leader in the unmanned aircraft systems industry.

• Watford City and McKenzie County, N.D., working cooperatively with other organizations and businesses to develop a city capable of attracting and supporting an unprecedented boom in population.

• Valley City, N.D.’s successful recruitment and expansion of a number of primary sector companies, such as John Deere Seeding Group and Eagle Creek Software Services.

• The ongoing development of an entrepreneurial ecosystem in Fargo, N.D., to the point where the city has been identified as “Silicon Prairie” and ranks as one of the top cities in the United States for people who want to start a business.

• Hope, N.D., pop. 300, becoming home to La Rinascente Pasta, the premier U.S. manufacturer of fideo/fedelini pasta.

This list of success stories could go on and on, and civic leaders in each of these examples could write a book about their community’s trials and tribulations. But the point is, none of these efforts would have succeeded if there had not been a person or group with the vision and the willingness to step up, take risks and truly make a difference.

Positive results such as these happened because the right leaders surfaced at the right places at the right times.

Understand, leadership does not always accompany a position or title. Residents shouldn’t assume that elected officials or community development staff must shoulder all of the responsibility for growth.

In fact, the most successful leader in a community could be the least expected. It could be the person who simply identifies an opportunity or challenge, and puts himself or herself in a position to bring about change.

One of the greatest challenges for most communities is to get residents to support and respect those who are willing to risk their personal wellbeing for the civic good.

Unfortunately, there’s no magic potion to put in the water that will create a community’s next generation of leaders. But that doesn’t mean the well is dry. Potential leaders are out there, and they’ll very likely step forward if the community provides encouragement, mentoring and most of all, support.

Even a strong leader needs strong and creative supporters. And that’s a leadership role we all can play.

Paul Lucy Interim President and CEO, Greater Fargo Moorhead Economic Development Corp.

A 29-year veteran of North Dakota economic development positions, Lucy also has served as director of the North Dakota Department of Commerce’s Economic Development & Finance Division, and as president of the Minot (N.D.) Area Development Corp.

PAUL

INTERIM PRESIDENT AND CEO OF GREATER FM ECONOMIC DEVELOPMENT CORP.

S.D. scholarship gets technical About labor shortage

PIERRE, S.D. – If you build it, they will come. That’s an iconic line from “Field of Dreams,” Kevin Costner’s classic baseball film.

And it’s also what South Dakota is doing to fill the workforce gap.

The state has built a scholarship program that turns high-needs industries into a worker’s field of dreams.

Booming economies in South Dakota and the Midwest mean states are plagued with unfilled positions, especially in skilled labor. South Dakota has gone through these growing pains for years, leaving fields such as construction, manufacturing and health care with hundreds of open positions.

More than half of the available positions don’t require four-year degrees, but do require technical skills. That’s why in 2014, South Dakota state leaders decided to create the Build Dakota Scholarship program to promote technical education to address South Dakota’s workforce shortage.

A $25 million gift from philanthropist T. Denny Sanford and a matching contribution from the South Dakota Future Fund combined to create the Build Dakota Scholarship program. The program offers full-ride scholarships for high-needs programs at all four of South Dakota’s technical institutes. Build Dakota has three main goals: change lives with opportunity, keep workforce and youth in South Dakota and connect businesses with skilled workers.

The scholarship covers tuition, fees, books and other resources for students going into high-need fields. Recipients commit to working fulltime in South Dakota for three years after graduation in that field. For students, the prerequisites are not strict. Potential students need to have a high school diploma or GED, apply to a high-need field and fill out a FAFSA form. Unlike many post-secondary school scholarships, students of all ages are eligible to apply.

So far, almost 900 people have been given the chance to work toward degrees without having to borrow any money to cover program costs.

The program has helped technical institutions in South Dakota buck the nationwide trend of shrinking enrollment. Since 2013, national enrollment at two-year public schools fell 11 percent, while South Dakota tech schools grew their numbers by 3 percent.

Programs at Lake Area Technical Institute in Watertown, S.D., and Southeast Technical Institute in Sioux Falls, S.D., are running at full capacity and looking to expand.

Aaron Jacobs, foundation director at Western Dakota Technical Institute in Rapid City, S.D., says the scholarship will grow South Dakota for years to come.

“Build Dakota fills a need, but it’s not about churning out employees as fast as possible,” said Jacobs.

“It’s about providing a life-changing opportunity for students to find a career they love. It’s a great example of businesses and education coming together to work out a solution.”

Industry partnerships not only give students the keys to a new career, but also let those students take their new position out for a test drive. CTE classes, part-time jobs and internships help students gain on-the-job experience.

Through the Build Dakota Scholarship program, more than 180 businesses have committed to paying a portion of students’ program expenses. The students get a free tech degree, valuable on-the-job training and mentorship while attending school, part-time employment and a guaranteed job after graduation.

In turn, the employer gets a trained worker ready to enter a field facing critical workforce needs.

As proof of the program’s success, industry funds for the scholarship have spiked from $147,081 to more than $1.4 million in four years.

Scott Knuppe, Build Dakota board member and an employee at Caterpillar Inc., believes the scholarship is a great way for companies to upskill current employees. “It’s another tool to internally improve your workforce,” said Knuppe.

“Businesses have jumped at the chance to invest in workers they know and trust.”

Over its first three years, Build Dakota has developed a talent pipeline for employers with critical workforce needs. Debt-free and ready to roll, Build Dakota scholars are making an impact right out of school.

Creating a dynamic tech education program in South Dakota isn’t that different from making a baseball diamond in an Iowa cornfield. If you build it, they will come.

Deni Amundson Program Manager Build Dakota

605-347-1804

deniamundson@goldenwest.net

Deni Amundson

FROM LEFT: KYLE SCHMIDT, A “ BUILD DAKOTA” STUDENT AT LAKE AREA TECHNICAL INSTITUTE IN WATERTOWN, S.D., STANDS WITH ALEX JOHNSON, MACHINING MANAGER FOR APPLIED ENGINEERING IN YANKTON, S.D. BUILD DAKOTA AND APPLIED ENGINEERING ARE PARTNERING TO PAY FOR SCHMIDT'S TECH EDUCATION; IN RETURN, SCHMIDT WILL WORK FOR APPLIED ENGINEERING AFTER GRADUATION. IMAGE: BUILD DAKOTA

Choice chooses growth

A Q&A

with Brian L. Johnson, Choice Financial Group’s CEO

EDITOR’S NOTE:

From its start as a merger of four rural banks in 2001, Choice Financial of Fargo, N.D., has grown to be a community bank with 19 locations in 17 communities in North Dakota and Minnesota.

In this interview, Prairie Business talks with Brian L. Johnson, Choice Financial’s CEO and board member, about the bank’s history and plans for future growth.

A. Q. CHOICE FINANCIAL BEGAN IN 2001 WITH THE MERGER OF FOUR LOCAL NORTH DAKOTA BANKS. WHAT DECISIONS HELPED 1+1+1+1 TO ADD UP TO MORE THAN 4?

At the time we merged, we had 60 employees and $160 million in assets. However, our message to employees consisted of two main themes:

• This was a merger for growth, not cost savings, and we wanted to gain new customers, especially in the ag sector, which we have a lot of knowledge about and expertise in.

• If we were going to be successful, we had to respect each market’s strengths and leadership in a collaborative fashion – rather than one market or one leader making all the decisions. This took time and effort, but it created more buy-in from the employees in having the organization meld together well.

BRIAN L. JOHNSON, CEO AND DIRECTOR AT CHOICE FINANCIAL GROUP, STANDS IN A CHOICE BANK IN FARGO, N.D. IMAGE: NICK NELSON/GRAND FORKS HERALD

Q.

CHOICE GREW “ORGANICALLY, THEN BY ACQUISITION,” AS ONE WRITER PUT IT. TALK ABOUT SOME KEY MOMENTS IN THAT TRANSITION.

A.Our intent to grow by acquisition came with me being named to CEO in February 2011. We had some success branching into the North Dakota cities of Fargo and Grand Forks, but that growth was leveling off.

It is my belief that employees and customers want to be part of a successful, growing, progressive organization. Our acquisitions have felt more like partnerships where our team members work together to build up resources, and this continually changing and evolving environment creates new opportunities for everyone.

In the early stages, our team worked tirelessly on all angles of lending, technology and leadership skills in order to put together a “playbook” on how to successfully navigate through an acquisition. We were well aware that four out of five merger/acquisitions overpromise and underdeliver on the expectations of employees, customers and shareholders.

Our management team took it as a direct challenge to outperform expectations.

The plan is one thing. The key is to make a deal come together, and this has two key factors:

• First, we need to be able to show the potential partner that the value is built post-acquisition, rather than focusing on what they sold for. Everyone gets focused on the sale price, because that’s what always gets asked. But if you can find some partners who’ll stay invested or reinvest, the conversation starts to shift to what value will we together create going forward. This puts the focus back on doing what is best for customers, employees and shareholders.

• Second, much like Choice in 2001, the new teams/entities must be willing to meld together in a collaborative leadership effort and make progress over expecting perfection.

The results need to be judged over the long term or full nine-inning game, rather than focusing on every detail and judging inning-by-inning.

Mergers and acquisitions require heavy lifting. It’s not easy, and takes significant commitment and buy-in from the board, shareholders, and employees to make it an effective strategy.

Q. DESCRIBE THE BANK’S “GEOGRAPHICALLY SCATTERED LEADERSHIP” AND THE ROLE THAT IT PLAYS.

A. A.

We are structurally unique, with executive leadership in Bismarck, N.D., Langdon, N.D., Grand Forks, Fargo and now Minneapolis. This can create challenges, and we recognize that we can’t have what are called “collision conversations” that occur spontaneously when folks run in to each other in the hallway and start a conversation.

However, our structure pays dividends locally as leaders build rapport with employees and customers, which keeps us in tune with what’s happening in our markets. This falls in line with our “PeopleFirst” approach: creating a culture to better the places we live, supported by employees who know they are empowered to make a difference for our customers, for our families and as leaders in contributing to causes that are important to our communities.

I wouldn’t trade the experience of this unique structure as it forces me to grow. It teaches me to delegate and trust because I can’t be there for every situation, question or decision.

At times, it may not be as convenient, but I believe it has created a culture that brings us back to our roots, and keeps our focus on the employees and customers who have helped us grow into the regional presence we are today.

Q.

YOU’RE A JAMESTOWN COLLEGE (NOW THE UNIVERSITY OF JAMESTOWN) GRADUATE WITH A DEGREE IN BUSINESS MANAGEMENT AND ECONOMICS. WHAT KEY LESSON DID YOU LEARN IN COLLEGE THAT YOU STILL THINK ABOUT TODAY?

I graduated in the late ’90s from the University of Jamestown, and I think they did a great job of setting expectations that college was not a finish line, but instead a bridge to the professional world.

Their work study program placed me in an insurance agency and then a bank, which showed me that my degree was a doorway for opportunity, not entitlement.

Q.

YOU’VE ALSO SERVED ON THE MINNEAPOLIS FED’S COMMUNITY DEPOSITORY INSTITUTION ADVISORY COUNCIL AND HAVE REPRESENTED THE NINTH DISTRICT IN MEETINGS IN WASHINGTON. WHAT DID THAT EXPERIENCE TEACH YOU ABOUT COMMUNITY BANKING IN THE MIDWEST AND NATIONWIDE?

A.

I was honored to chair the regional Federal Reserve board, which allowed me to meet with the Board of Governors twice a year with 11 other community bankers from around the country. It was a unique experience as I served under Chair Janet Yellen last year, and under Chairman Ben Bernanke the first two years.

In Washington, if politics isn’t involved, officials can care more about the people in the country over votes and power, and good things can get done. Chair Yellen and the board understood and cared deeply about what community banks do for the country in terms of small business and rural lending.

I’ve served in a number of community banking roles that involve Washington, but it was truly great to be involved with the Fed, as the people there recognize how the government process has to work, while also knowing that their mission is driven by what works best for the citizens. If the rest of Washington used this as a basis for decisions, it would make the country much stronger, and there would be far less division.

That is why I’m happy to come back home to the Midwest – even in January – because here I work with people who make decisions using PeopleFirst style of thinking, and who value their communities over power in politics.

Q. IN 2017, CHOICE SET OUT TO RAISE $100 MILLION FOR FURTHER EXPANSION OPPORTUNITIES. FIRST, TELL US ABOUT THE CHALLENGE OF RAISING THAT MONEY LOCALLY, RATHER THAN FROM A PUBLIC OFFERING OR MONEY CENTERS ON THE COASTS.

For both the organization and myself, this was a whole new chapter! Choice has been blessed with tremendous successes, and when it goes well, it can be a challenge for a board and leadership to carve out a completely new path.

Over the past few years, we’ve had a lot of offers from outside (East/West coast) investors to provide us capital for growth opportunities. However, our board recognized our heritage – how Choice was built by investment from local neighbors – and wanted to stay true to our origins. Board members decided that if we are raising money, we’ll do so locally again.

Our target was set at $100 million. Our market presidents and other team leaders made the contacts and set up the meetiangs for three dozen presentations throughout North Dakota in under six weeks.

Personally, it was a great experience, because in six short weeks, I had the privilege of meeting so many incredible people across the state, a task that would’ve taken me five years to accomplish.

In the course of one day, I started out in LaMoure, N.D., went to Jamestown, N.D., then to Dickinson, N.D., and then ended the evening east of Mahnomen, Minn. – making four stops in one day.

I joked that I now know why a preacher gives only a couple of sermons in a week … because when you do 36 in six weeks, it can really become a blur. We were overwhelmed and humbled by the response, and filled the offering two days before Christmas. And to our delight, we have a substantial waiting list of potential investors who were not able to get into this offering.

This showed me that we have a pretty good story and track record, and yes, people saw it as a good investment opportunity.

But to raise that amount of money privately and locally shows what Choice does for the business and ag economy in the region, and in turn people wanted to support that.

People have a lot of investment options, and the stock market has done well over the past year. So it is great to see individuals step up to a private company and say, “I believe in them and what they are trying to do.”

SECOND, WHAT’S THE PURPOSE OF THE FUNDRAISING? IN OTHER WORDS, HOW WILL THE MONEY BE USED?

When we put together the raise, the offering indicated that we wouldn’t take the money unless we needed it for a deal. This had a two-fold effect: it wouldn’t force us to spend the capital unless a deal was right, and it sent a message to any seller that our check was good. We conveyed to our new investors that our goal is to continue growing while keeping an organization that is in touch with and can make decisions at a local level. Our vision is to grow within the six-state region (North and South Dakota, Minnesota, Wisconsin, Iowa and Montana), in areas where we are specialized in business and agriculture services, while at the same time providing clients other financial services to meet all their financial needs. If we weren’t able to make a deal, investor commitment would expire in December 2018. Fortunately, we found a partner in Venture Bank – a local, private bank operating in the Twin Cities which coincidentally was started in 2001, just like Choice. This partnership will grow our asset base by about 60 percent to around $2.1 billion, and take our employee count up about 40 percent to more than 350 employees.

Our Senior Water Resource Engineer, Tom, loves a challenge. That’s why when designing a solution for stormwater retention/detention, Tom got creative. By creating an eco-friendly solution over a traditional pump station, this portion of flood control provided an innovative approach and saved the Souris River Joint Board millions of dollars in the process.

Turning his passion into progress, that’s what Tom is most proud of. And we are, too.

To learn more about the Centennial Pond/Perkett Ditch project, visit our website at www.ackerman-estvold.com/projects

CORPORATE COMMUNITIES

Setting the bar for successful work communities, team engagement and employee satisfaction. Look inside for valuable employment opportunities and recruitment advice.

Q.

A.

WHAT’S THE BEST WAY OF TELLING PROSPECTIVE APPLICANTS ABOUT AN OPENING AT AE2S?

Word-of-mouth from AE2S employees provides the best pipeline of prospective applicants. Our friends, colleagues and neighbors get an inside track as they hear about the exciting projects and various opportunities available from employees, who can speak directly of their experiences first-hand.

In turn, employee referrals tend to align well with not only the position but also our core values and company culture.

Q.

WHAT ARE THE BENEFITS OF LIFE IN AE2S COMMUNITIES (SUCH AS GRAND FORKS) THAT APPLICANTS SEEM ATTRACTED TO?

A.People want to be part of something bigger than themselves and to make a difference in their community. Applicants recognize the sense of community AE2S promotes and the importance placed on giving back to the communities we’re proud to be part of.

MICHELLE MCDONALD-TROSTAD

Human Resources Generalist

Advanced Engineering and Environmental Services, Inc. (AE2S)

Grand Forks, N.D.

IMAGE: AE2S

Q.

Furthermore, a number of benefits surround us in our various communities. To name a few, these include safe neighborhoods, employment or business opportunities, easy access to health care and wellness facilities and quality education in a safe and secure environment for themselves and their family members.

Q.

HOW DO NEW SUPERVISORS LEARN ABOUT THE ORGANIZATION’S EXPECTATIONS AND MANAGEMENT STYLE?

A.Many of our new managers have successfully advanced from within our firm and understand the organization from their experiences. Managers who are hired externally are provided with a comprehensive onboarding plan to assist them in fully integrating into AE2S and understanding those whom they’ll be working most closely with on a daily basis.

In each case, the new manager is able to connect with other managers in the same or similar roles to ask questions, bounce ideas and brainstorm on the kinds of situations that may arise in a collaborative work environment.

Q.

WHAT TRAITS DO YOU LOOK FOR IN NEW HIRES TO MAKE SURE THE EMPLOYEE WILL FIT IN WITH YOUR WORKPLACE CULTURE?

A.Cultural fit aligns with new hires who are solution-driven, who have a passion to provide top-notch service and who seek out ways to make our communities better.

WHAT CULTURAL OR MORALE-BUILDING INITIATIVES SEEM TO BE THE MOST POPULAR AMONG EMPLOYEES?

A.AE2S employees come together at various times throughout the year to raise funds, volunteer and give back. The friendly competition of meeting fundraising goals or the opportunity to provide for others in need brings employees together while also building morale.

AE2S also hosts monthly celebration events to recognize employee birthdays and anniversaries. And summers are not complete without our annual picnics, where AE2S employees and their families get together for food and fun.

Living First isn’t just wishful thinking, it’s how we intentionally live and have been for over 100 years.

We’ve learned that banking is more than brick and mortar, drive up windows and ATMs because we’re not just in the banking business. We are in the small-business, business, the community sponsorship business and the how do I make this happen, business.

You can say with four generations of bankers, we are in the legacy-building business.

We’re all about relationships. Family. Placing our focus on your success. Making your banking life easy so you can focus on what matters most.

BANKING | MORTGAGE | INSURANCE* | TRUST & INVESTMENTS*

27 locations across North Dakota, Minnesota and Arizona

(800) 359-8092 | rstintlbank.com

minnkota.applicantpro.com/jobs

BRAD SCHOENFELDER

Senior Executive Director of Human Resources

Sanford Health

Sioux Falls, S.D.

IMAGE: Sanford Health

Q. WHAT’S THE BEST WAY YOU’VE FOUND TO LET PROSPECTIVE EMPLOYEES LEARN ABOUT OPENINGS?

A.Sanford Health’s footprint stretches across the Midwest and even around the globe, so we use many different tools to share our various employment opportunities.

Digital marketing and social media are a crucial part of our daily strategy. We are very active on job service sites and work to cultivate relationships with colleges and technical programs to connect in-person with job seekers.

Our teams attend professional and national conferences to extend our reach with candidates for high-demand professions.

We know it’s imperative to build awareness early, so we partner with HOSA – the national health-care career organization – to expand students’ awareness of available health care careers and help them explore potential career paths.

Q. WHAT ROLE, IF ANY, DOES SOCIAL MEDIA PLAY IN RECRUITING?

A.

Social media is a key recruitment tool. It lets us share not only job opportunities, but also our story as an organization.

We can present a more comprehensive picture of our culture, mission and values, using profiles, videos and behind-the-scenes images.

We have more than 28,000 employees, which means our staff is one of our biggest assets on social media. Sanford staffers serve as brand ambassadors, helping to spread the word and share our successes across their networks. Social media is a very powerful tool in the recruitment toolbox.

Q. HOW DO YOU COMPETE WITH BIGGER METRO AREAS WHEN YOU’RE RECRUITING IN HIGH-DEMAND HEALTH CARE FIELDS?

A.We offer unique opportunities for health care professionals looking to work in the Midwest and be on the cutting edge of health care technology and research.

As an integrated health care system, we offer opportunities to work in large cities or small towns. In all our communities, employees can raise their families and enjoy all the benefits of living in this part of the country, including great school systems, safe and affordable housing, competitive wages and outdoor recreation.

At the same time, Sanford Health is making strides on the national stage with medical advancements, research and the latest technology. This combination is appealing to many candidates in high-demand health care fields.

Q.

HEALTH CARE WORKERS HAVE A LOT OF TRAINING AND CONTINUING EDUCATION REQUIREMENTS TO FULFILL. CAN BENEFITS IN THOSE AREAS SERVE AS RETENTION TOOLS?

A.Yes! Offering knowledge and skill advancement opportunities close to home serves our employees in many different capacities.

Sanford offers diverse continuing education programs that not only support health care licensure requirements but also support our employees’ desire for continuous learning and development.

During the past year, Sanford offered more than 5,000 hours of continuing education credit. Employees have direct access to world-renowned experts in health care without having to take time away from their personal life to meet their professional educational needs.

Providing these local opportunities for growth and development is key for employee retention.

Q. HOW DOES SANFORD KEEP A COMMON ‘WORKPLACE CULTURE’ ACROSS ITS MULTIPLE LOCATIONS?

A.Our workplace culture is strongly influenced by the quality of our leadership. At Sanford Health, all employees enter our organization learning about our mission, vision and values. We insist on a culture of service and believe that all of our employees are caregivers, no matter their position or location. We are all responsible for the care of our patients and their families, and our mission – dedication to the work of health and healing – is ingrained in the fabric of our organization.

This common thread unites our employees, in all of our locations across the Midwest and beyond.

Making a Difference

For a Better Way of Life.®

Making a Difference in Our Community

Gate City Bank is making a difference in our communities through our Acts of Kindness, including volunteerism, philanthropic giving and partnerships with local organizations. In 2017, we gave $1.95 million in donations and volunteered 13,400 hours as a company. We encourage our employees to volunteer on company time, and match monetary donations made by employees to charitable organizations.

Making a Difference for Our Employees

Gate City Bank is making a difference in the lives of our employees through our unique benefit offerings, like our paid maternity and paternity leave for employees to spend more time with their new child and bonus PTO gifts throughout the year. We are also a celebratory culture! We have weekly fun days and celebrate employee milestones and achievements.

Together we can make a difference, For a Better Way of Life.®

Gate City Bank Mission:

To provide a welcoming atmosphere and a commitment to making the lives of our customers and employees better by investing in them and their communities For a Better Way of Life.®

gatecitybank.com

REPUTATION BUILT BY HAND

Most Admired US Companies

Best Places to Work

Architecture Giant

TANYA KESSEL

Team Lead for Recruitment

National Information Solutions Cooperative Mandan, N.D.

IMAGE: NISC

Q.

WHERE DO YOU LOOK FOR NEW EMPLOYEES?

A.Our most successful recruitment tool is quite simply our own employees at NISC. We recognize that keeping individuals informed of opportunities within the organization and throughout our talent selection process is key to finding new employees who best match the qualifications of the open position as well the values of our company.

We also appreciate that communities in our region are filled with high-caliber talent. We emphasize the importance of building relationships by actively participating in career and job fairs, maintaining campus connections and offering paid internships with the intent of the positions turning into full-time opportunities.

Q.

A.

WHAT BENEFITS SEEM TO BE THE MOST IMPORTANT FOR ATTRACTING NEW EMPLOYEES?

With the workforce being quite dynamic and competitive, we want to ensure we can recruit the best and brightest by offering the best benefits, including a zero-premium health insurance plan for the whole family.

Another not-so-traditional benefit is one of our greatest methods for attracting new employees: our culture. People are the heart of our organization, and we are committed to employee satisfaction.

Flexible work hours, a focus on wellness and regular employee activities are the norm at NISC, creating a family-like atmosphere.

Q.

WHAT BENEFITS SEEM TO BE THE MOST IMPORTANT FOR RETAINING NEW EMPLOYEES?

A.For most employees, we’ve found the emphasis is on growth, health and retirement.

From the growth perspective, we encourage continuous coaching between an employee and his or her supervisor, keeping the focus on personal development and career advancement.

We also work diligently to negotiate a health benefits package of the kind mentioned above, which is a very rare offering in today’s business world. Lastly, for those employees planning for the future, our 401(k) retirement plan is very generous with both an annual match and contribution.

Q.

HOW IMPORTANT IS WORK/LIFE BALANCE WHEN IT COMES TO RECRUITING AND RETENTION?

A.Work/life balance is a term you hear often, but at NISC, it is woven into the very fabric of who we are.

We like to think of ourselves as a progressive cooperative and have adopted a number of policies to increase employee satisfaction. From flexible work days to a fully-equipped gym to annual family events, life at NISC is a bit different – and that’s a good thing.

We feel that appreciated employees are engaged employees, and if the employees are taken care of, they will, in turn, take great care of our Member-Owners.

Q.

HOW DO YOU KEEP YOUR EMPLOYEES ENGAGED IN THE WORKPLACE?

A.NISC cares deeply about the same things our employees do: Health, community and growth. We offer a wellness program, promoting healthy living and earning health savings account deposits while doing so.

We take great pride in civic engagement and encourage employees to participate and give back to the community. And lastly, we have incorporated the lattice method to encourage growth and career movement for the employees, which helps us develop a more distributed workforce while also encouraging the learning, development and enrichment of our employees’ careers.

ABOUT US:

Fisher Industries is a family of businesses that serves all aspects of the aggregate industry. Whether its manufacturing aggregate processing equipment, mining and delivering aggregate products, or the final roller pass across freshly laid asphalt; we stand ready to tackle the industry’s toughest jobs. But we are so much more than just rocks. We are a unified team, working together to cement our place in the industry. From accountants to welders, we employ over 1,100 professionals during our peak seasons.

Q.

A.

HOW DOES FWB&T MAKE SURE THAT A NEW HIRE IS A GOOD FIT?

We strive to hire “a good fit” each time. We look for not only the proper skills, but also the proper values: a desire to help others and build relationships in the community.

During the interview process, we describe the culture of the bank and the duties of the position. We keep the process friendly and ask questions to get to know the candidate. We’re looking for team members who strive to be successful and who want to make the bank successful. We love to visit with those active in the community and willing to give back.

First Western Bank & Trust is a great employer, as evidenced by the longevity of our employees. We have many employees celebrating more than 20 years with the bank and some with more than 40 years. Our bank president has worked here since high school.

We are known as a leader in the community and recognize the individuality of our customers. That culture attracts candidates.

Q.

ILENE BAKER

Human Resource Manager

First Western Bank & Trust Minot, N.D. IMAGE: FWB&T

Q.

WHAT BENEFITS SET FWB&T APART AS A GREAT WORKPLACE?

A.When I ask employees this question, their answers vary by what stage of life they’re in. But consistently, two answers are given:

First Western offers a medical benefit that goes above and beyond most employer offerings. We offer a high deductible health plan and a Health Savings Account, with preventive coverages that go beyond those required by the Affordable Care Act.

Additionally, the bank makes monthly contributions to the employee’s Health Savings Account, which not all employers offer. A portion of the premiums for all plans from Single through Family are paid by the bank.

The bank also offers a 401(k) plan, with the bank’s match of the employee’s contribution vesting immediately. The Trust Department manages the plan, and administration fees are waived.

Q.

WHAT DOES FIRST WESTERN BANK & TRUST’S HIRING PROCESS ENTAIL?

A.We value making the process convenient and engaging for our candidates. The position information is linked to our website. This lets the candidate apply seamlessly online.

The position also is posted on websites of the state, nearby colleges, member associations, Indeed and LinkedIn, as well as internally. We receive and value employee referrals.

Applicants are screened in Human Resources for qualifications. We recognize the importance of communication with each candidate and make follow-up a priority.

Usually two rounds of interviews are held. Top candidates may meet with other staff, and any offer is made pending a background check.

I love being able to congratulate a successful candidate and welcome him or her to the team.

All new hires attend First Western University as an introduction to the bank. At the completion of the six weekly classes, our bank president recognizes the graduates and presents them with a gift. They are recognized again in front of their co-workers at the next all-staff meeting, where they are presented with a certificate and a pen and pencil set.

Q.

WHAT CHANGE IN THE WORKPLACE CULTURE WOULD A FORMER FWB&T EMPLOYEE FROM THE 1980S BE MOST IMPRESSED WITH TODAY?

A.Taking care of our customers and taking care of our employees have stayed the same. So, First Western Bank & Trust’s biggest change probably has been in technology. In the ’80s, the bank used typewriters, calculators, paper and pen, and customers’ coins and bills were counted manually.

Now, modern technology lets our customers do more banking online from anywhere, any time. Customers pay bills electronically, and businesses can do payroll and deposits from their offices. Information technology is essential for all banking.

WHAT STRATEGIES HAVE YOU FOUND TO BE MOST EFFECTIVE AT RETAINING EMPLOYEES?

A.FWB&T provides professional development. We give our employees the best knowledge and tools for success and leading the bank into the future.

Employees know that their families come first. We’re flexible with staff so they can enjoy their children’s activities or take care of an ill family member. Our employees are caring, friendly and knowledgeable. They often talk about the First Western family. Co-workers celebrate each other’s birthdays. It’s fun to go to work when you enjoy your co-workers.

Employees are shown appreciation in many ways. We take a week each April to express the bank’s appreciation for staff with special meals such as a barbecue, gifts, and thank you notes from supervisors. There are monthly “treat” days and activities throughout the year such as a family picnic, Office Olympics and chili cook-off, as well as a Christmas celebration that includes a wonderful dinner and entertainment.

All employees are eligible for event ticket drawings throughout the year. And every night of the summer, tickets are available to the Medora Musical. Employees also are encouraged to volunteer and given time at work to do so.

Start Your Story with Graybar

Who are we?

Graybar is a FORTUNE 500 distributor of electrical, communication and data networking equipment. We strive to be the best company to work with, the best company to work for and the best-in-class distributor in our industry. Our 8,500 employees are the key to Graybar’s success.

What makes us different?

As an employee-owned company, Graybar provides competitive benefits and training opportunities that support employees’ long-term growth with the company. Our history of promoting from within and offering opportunities for advancement are just a few of the reasons why Graybar was recently named one of “America’s Best Large Employers” for 2018 by Forbes.

Where are we located?

Graybar has approximately 290 locations across North America. North and South Dakota locations include Bismarck, Brookings, Dickinson, Fargo, Grand Forks, Minot, Sioux Falls and Watford City.

How do we serve our community?

At Graybar, we strive to strengthen the communities where we do business through meaningful charitable contribution and volunteerism. We align our philanthropic efforts with the interests of our employees, customers and suppliers. We take great pride in helping each other and those in our communities in times of need. That’s been the foundation of our business for nearly 150 years.

To learn more about Graybar and our career opportunities, please visit graybar.com.

Graybar is an Affirmative Action/Equal Opportunity Employer.

The Bakken Rocks CookFest will celebrate its 10th anniversary when it takes its festivities to Grenora on July 17 and Twin Buttes on July 19. The event was started by the North Dakota Petroleum Council in 2008 to create a fun, friendly atmosphere where North Dakotans could learn more about the oil and natural gas industry, meet its players, and enjoy a free barbecue and live music at the height of summer. And the best part?

IT'S FREE

So come out and join us for the 10th Annual Bakken Rocks CookFest!

JULY 17: GRENORA

2-3 PM: Information Session

4-7 PM: Free BBQ, free stuff and live music by Shark Week

JULY 17: TWIN BUTTES

2-3 PM: Information Session

4-7 PM: Free BBQ, free stuff and live music by ND 22

Q.

TELL US ABOUT SOME OF THE MOST CREATIVE BENEFITS THAT LEMONLY OFFERS.

A.• Five-year adventure bonus: In accordance with one of our core values of “Adventure,” we give each employee $2,500 and an extra week of vacation to travel internationally on their five-year anniversary with the company.

• Annual 3/2/1 charity donation: Each year, we set aside $6,000 to be donated to local charities. Each employee nominates a charity of their choice, the team votes for their favorite, and top-voted charities get $3,000, $2,000 and $1,000.

• Summer hours: The concept is simple : from Memorial Day through Labor Day, we work a 2/3 day on Fridays, and many folks start their weekends by 3 p.m.

Q.

A.Our current list of perks include: Work anywhere, flexible scheduling, top 25 percent salaries, paid overtime, vacation and paid holidays, volunteer time off, summer hours, health, dental and vision insurance, 401(k) retirement plan, paid parental leave, five-year adventure bonus, annual continuing education and development allowance, annual company retreats, 100 percent coverage of hardware/software, annual charity donations, bi-monthly lunch and learns, free snacks and beverages, holiday gifts, profit sharing and wellness challenges.

A real-time update of our perks can be found at lemonly.com/blog/ employee-benefits-lemonly.

MANY OTHER ORGANIZATIONS MIGHT LIKE TO OFFER GENEROUS BENEFITS, BUT WOULD SAY THAT DOING SO IS TOO EXPENSIVE. HOW WOULD LEMONLY RESPOND?

A.It’s more expensive to have people leave your company and have to hire and onboard new employees.

We’ve found that investing in benefits and perks has helped us in the long run with retention and employee happiness, because happy employees = happy clients.

Just last month, 70 percent of revenue came from existing clients. If clients love who they work with and what we produce, they’ll keep coming back for more.

JOHN T. MEYER CEO and co-founder Lemonly

Sioux Falls, S.D. IMAGE: Lemonly

Q.

HOW DO YOU SCREEN CANDIDATES TO MAKE SURE THEY’LL FIT IN WITH LEMONLY’S CULTURE?

A.By being transparent as a company with our benefits and workplace culture, that helps do a lot of the work for us.

Q.

BESIDES BENEFITS, WHAT OTHER SIGNIFICANT RETENTION AND/OR WORKPLACE-CULTURE INITIATIVES HAS LEMONLY PUT IN PLACE?

In addition to a nice list of benefits and perks, we offer a company culture where people are constantly growing by setting new goals every 100 days to help with professional and personal development.

There are many tangible and measurable benefits to valuing company culture, but honestly, the most important reason to me is that taking care of people simply is the right thing to do to. A.

Being in a creative industry, one of the biggest fears our employees have is getting “stuck” and not pushing themselves to their full potential. By creating a culture of continuous improvement, we ensure that both Lemonly and our employees are taking risks, growing and improving.

New ideas are constantly brought to the table for the company because of our goal-setting initiative.

Applicants know Lemonly based on the look of our website, reading our blog posts and following us on social media. We look for candidates who take the extra step to get to know who we are and show us their personality right away with their application, and we ask questions that reflect our culture.

We’ll figure out if people are the right fit for Lemonly, but I want people to believe that Lemonly is the right fit for them.

Q.

GIVEN THAT LEMONLY’S WEBSITE LISTS ‘WORK ANYWHERE,’ ‘TOP 25 PERCENT SALARIES’ ‘SUMMER HOURS’ AND OVERTIME (FOR SALARIED PERSONNEL) AS BENEFITS, HERE IS SOME MORE ROOM IN WHICH TO DESCRIBE THE PERKS.

The Midwest meets the innovation challenge

By Joel Honeyman

WEST FARGO, N.D. – On a jobsite not far from here, a Bobcat compact track loader recently was performing some grading work. The operator had been working for a few hours and was making good progress.

Around 11 a.m., he noticed an error code on the instrument panel. About 10 miles away, a fleet management system at the local Bobcat dealership notified a sales specialist of the fault code on that same machine.

Within five minutes, the machine’s owner got a call from the dealership. The sales specialist had his service department send a service truck to the customer’s jobsite.

After tests and an inspection, the technician found a small malfunction that could have crippled the machine had it gone unaddressed much longer. The fault code and the attentive sales specialist saved this owner thousands of dollars in machine repairs, downtime and project delays.

This is just one example of how technology is transforming construction jobsites, and many may not realize this transformation is taking place thanks to technological advances occurring right here in the Midwest.

For instance, the research and development of fleet tracking technologies, like the one used in the above example, currently takes place at Doosan Bobcat’s North Dakota facilities in Bismarck, Gwinner and West Fargo. Our Acceleration Center in Bismarck serves as our key cross-functional development facility for initial design, prototype engineering, prototype manufacturing, computer simulation and testing of ideas and concepts.

The facility is equipped with state-of-the-art tools and software that expedite leading-edge product and process development.

We live in an on-demand, highly connected world. The customers who buy our machines expect to have the latest and greatest technology at their fingertips, whether it’s in their iPhone, their new truck or a Bobcat compact track loader. That’s why software engineers have become as critical in our product development as mechanical engineers.

Not long ago, this type of cutting-edge work would have been exported to a regional tech hub such as Silicon Valley. But communication and technology advances have eliminated geographic barriers.

For example, we recently started to collaborate with a company that is headquartered in Switzerland, runs a development team in Russia and has a business office in San Francisco. We have worked with representatives from all three locations, and we’re developing the prototype for this project right in here in North Dakota.

That kind of partnership was unheard of until recently.

But that’s an extreme example. More often than not, we don’t have to go that far to find the help we need. We partner with a number of local technology companies that are instrumental in helping us create the most technologically advanced compact equipment in the world.

Smart young people no longer have to bolt for the coasts or the big city to take full advantage of their talents.

The larger point is that innovation is no longer isolated, and rightly so. Innovation is an expectation, and we have to be able to execute it here and deliver the results across the world.

There are fewer barriers than ever to doing that from North Dakota. Which just means our customers’ expectation that we deliver innovative solutions has never been higher.

The jobsites our customers have known for more than 50 years will be much different just five, 10 or 15 years from now. They will be smarter. They will be safer. They will be more efficient. Some will even be autonomous. And in the case of those that have Bobcat machines operating on them, the jobsites of the future will run on North Dakota innovation.

Joel Honeyman Vice President of Global Innovation

Doosan Bobcat North America West Fargo, N.D.

joel.honeyman@doosan.com

JOEL HONEYMAN Vice president of global innovation, Doosan Bobcat North America

IMAGE: Doosan Bobcat

ESOPs turn workers into owners

Heartland has a special place for ESOP model of ownership

By Lance Nixon

GRAND FORKS, N.D. - For Hal Gershman, the problem was one of succession: what to do with the North Dakota business that his father, “Happy” Harry Gershman, started in 1944, and that Hal took over and steered through multiple expansions starting in 1976.

Hal’s daughter had her own career and wasn’t necessarily interested in assuming leadership of Happy Harry’s Bottle Shops, the company that now comprises two stores in Grand Forks, N.D., and three in Fargo, N.D.

The solution Gershman worked out over an eight-month process in 2015 was to start an employee stock ownership plan, or ESOP.

“I was interested in protecting the future for the employees,” Gershman said. “I like to tell people that when I was younger, I was a pretty damn good retailer. These people are better than I was. They know how to taste, they know how to buy, they’ve got the culture of our service – how we treat people.”

The ESOP that went into effect at the end of 2015 rewards employees and also maintains the culture of Happy Harry’s.

“It’s a lifetime of work of my father and a lifetime of work of myself. It’s one way to protect the legacy of your work,” Gershman said. “It’s always premised on having really, really qualified people, and I have that. If someone’s thinking of an ESOP, you have to have your people in place to do it.”

ESOPs vary considerably from company to company in the details. The Happy Harry’s plan requires an employee to work 1,000 hours in a year to qualify. Once employees qualify, the number of participatory shares they receive is based on time and income; the higher the salary, the more stock they will have in the business.

At the end of six years, they are entirely vested in what amounts to a retirement plan. If they leave the company, their stock is paid out like a 401(k) plan.

Gershman remains president and chairman of the board for Happy Harry’s, working on strategic planning and advertising for the company. But the new ownership arrangement also allows him more time for other things.

CULTURE AND LEGACY

Two of the words Gershman uses to describe his experience with forming an ESOP show up often when other exectives talk about their own path to employee ownership: culture and legacy.

Steve Storkan, director of ESOP administration for Alerus, the Grand Forks-based company that helped Gershman set up the Happy Harry’s plan, says a desire to see company legacy continue is one of the common features of many ESOP companies.

For example, Grand Forks-based AE2S, an engineering and consulting firm with offices in both Dakotas, Minnesota, Wisconsin, Montana and Utah, had a culture that recognized the worth of employees from the time the company formed in 1991, CEO Steve Burian said.

Burian, who co-founded the company with President Charlie Vein, said starting an employee stock ownership plan was a natural extension of that. And it made sense because the company was already adding “junior owners” over the years – so many that by 2017, 44 people (including the two founding owners) owned a part of the company.

“That process got to be cumbersome,” Burian said. “One major advantage of the ESOP is that it created a much more defined and sustainable process for transitioning shares over time.”

It also fit the company’s culture in that the new plan allocated stock to every employee helping to make the business a success – providing additional income for their retirement, while providing some tax advantages that can help fuel the company’s growth.

At JLG Architects – the largest architecture-only firm in North Dakota and one of the top 25 in Minnesota – Chief Financial Officer Jason Haagenson said employee ownership turned out to be an ideal mechanism for a transition its founders had in mind anyway.

“Our company was fast-growing at the time. The majority owners had long held the belief of open-book management and also had a vision for being a legacy firm,” Haagenson said.

“They wanted the JLG business brand and expertise to continue after their professional careers were done. The ESOP really accentuates or works well with that philosophy.”

Culture and legacy also ranked high among the Gage family’s reasons for choosing an ESOP, said Tom Kelley, president of Gage Brothers Concrete Products, a Sioux Falls, S.D.-based manufacturer that started an ESOP in 2008.

“The thinking was that we wanted to maintain the family ‘clan’ culture that we have had for more than 90 years,” Kelley said.

“We also saw how consolidation of companies similar to ours by larger international conglomerates was not always producing the successful transition that we would like. Also, they would tend not to keep their internal brain trust after the sale.

“We wanted something different that would continue our growth and keep our key employees while maintaining our family culture. The ESOP was the ticket . … The Gage family looked at it as leaving a legacy. It was a way of giving back to the employees who had helped build the company.”

TAX BENEFITS

One practical way in which an ESOP solves problems is by offering companies tax benefits. Congress authorized this arrangement to both incent owners to set up ESOPs, and to let employees benefit from their employer’s growth.

Here’s how to think about the structure that results: “An ESOP is actually a tax-exempt trust set up for the benefit of employees,” a Forbes magazine story explained in 2016.

This changes the tax treatment of the company in multiple ways. For example, an owner who sells his or her business to an ESOP can – with certain restrictions –avoid paying capital gains taxes.

IF YOU’RE THINKING OF DOING AN ESOP…

The CFO of a North Dakota-based architectural firm that launched its employee stock ownership plan in 2014 offered several tips for business owners considering an ESOP. Jason Haagenson of JLG Architects said it’s wise to first consider whether your business is large enough and profitable enough to sustain an ESOP, as there will be start-up costs and ongoing costs to the company.

If it seems like a good fit:

• Talk to businesses in your area that have ESOPs for some practical advice.

HAL GERSHMAN, PRESIDENT OF HAPPY HARRY'S BOTTLE SHOPS, STANDS AMONG THE WINE AISLES AT HIS 32ND AVENUE SOUTH STORE IN GRAND FORKS, N.D. IN 2015, GERSHMAN STARTED TRANSITIONING HIS COMPANY'S OWNERSHIP TO AN EMPLOYEE STOCK OWNERSHIP PLAN.

IMAGE: NICK NELSON/FORUM NEWS SERVICE

• Visit with national groups such as the ESOP Association (online at www.esopassociation.org) and the National Center for Employee Ownership (www.nceo.org) for more technical advice. Closer to home, the Minnesota/Dakotas Chapter of the ESOP Association (http://www.mndak-esop.org) is also a good source of information.

• When you’re sure you want to move ahead with it, bring in specialists as needed, such as financial planners and lawyers who work with Employee Retirement Income Security Act law. They can help you set up a plan that works for you.

• Keep in mind that because an ESOP is in essence a retirement plan, the federal Department of Labor and the Internal Revenue Service will have to sign off on yours before it goes into effect.

The savings can be significant, considering that the owner often has spent an entire lifetime growing the business.

And for S-corporations, “a company 100 percent owned by its ESOP does not pay any federal and most state income taxes,” Forbes explained.

“Yes, you read that correctly: the profits earned by the company stay with its employees,” often resulting in increased contributions to the employees’ ESOP accounts.

As Paul Halverson, a Minneapolis-based financial advisor, told Forbes, “this is the redistribution of wealth done the right way.”

SIDE BENEFIT: QUALITY

Companies that have ESOPs tend to agree that the plans ratchet up the quality of the company’s products and services. For example, Haagenson, of JLG Architects, suggests that having an ESOP not only makes it easier to recruit and retain top talent, it probably brings out employees’ best work.

“Employee engagement has improved since the transaction four years ago. They feel empowered due to our culture, the employeeownership culture that we have,” Haagenson said.

“People understand that what they do on a daily basis affects the bottom line for JLG.”

At Alerus, Randy Newman, president, CEO and chairman of the board, said one company goal is to create long-term value for all shareholders, including employees.

“We have a long-held belief within Alerus that the ESOP positions all of us to have a vested interest in the success of our company,” Newman said. “As owners, we think differently by making decisions in the benefit of our clients, and our company. As owners, we also share in the company’s financial success.”

President J. Michael Keeling of the Washington-based ESOP Association believes he knows why quality trends upward in ESOP companies.

“The individual benefits in the long run if the company does well. It’s money in their ESOP. It’s their personal gain,” Keeling said. “They’re part of a system called capitalism.”

THE VIEW NATIONALLY

According to the National Center for Employee Ownership, the greatest number of ESOPs – about 32 percent of the nation’s total – are in the Midwest. But the smallest numbers of ESOPs in the region are found in the Plains states that make up the west wall of the Midwest. Kansas and Nebraska have 108 and 69 ESOPs, respectively, while North Dakota and South Dakota have 59 and 25.

THIS 2016 PHOTO SHOWS SOME OF THE STAFF MEMBERS OF JLG ARCHITECTS, A GRAND FORKS, N.D.-BASED FIRM. JLG SET UP AN EMPLOYEE STOCK OWNERSHIP PLAN TO BENEFIT ITS EMPLOYEES AND TO HELP PRESERVE THE COMPANY'S BRAND AND CULTURE, A SPOKESMAN SAID. IMAGE: JLG ARCHITECTS

EMPLOYEES OF GAGE BROTHERS, A PRECAST CONCRETE MANUFACTURER IN SIOUX FALLS, S.D., ARE AMONG THOSE WHO'LL BENEFIT FROM THE COMPANY'S EMPLOYEE STOCK OWNERSHIP PLAN. IMAGE: GAGE BROTHERS

SHORTLY AFTER COFOUNDING AE2S IN 1991, CHARLIE VEIN

18 OFFICES, INCLUDING THIS HEADQUARTERS IN GRAND FORKS, N.D. IMAGES: AE2S

One possible reason the Plains states have so few may be because ESOPs, according to the data, are not common in industries such as agriculture and mining. They’re more common in service industries; manufacturing; finance/insurance/real estate; and construction, in that order.

Keeling said the greatest number of ESOPs are found in a swath of the Midwest that starts in south-central Michigan, runs straight across to southwestern Michigan, then across Lake Michigan to southern Wisconsin and finally to the Twin Cities area. Grand Rapids, Mich., for example, has more ESOPs than many large metro areas.

Keeling has theories about why that may be.

“I truly believe that a lot of it is the heritage of that part of America, of the Scandinavian-Protestant ethic,” Keeling said.

“When I visit companies that have done ESOPs – this is true of companies I have visited in southern Michigan, southern Wisconsin

and the Twin Cities area – when the owner-founder who is still there or someone who is the first-generation CEO type, etc., talks about the company, they use plural personal pronouns: ‘We did this.’”

That’s in contrast to the first-person singular pronoun Keeling has heard from owner-founders in some parts of the country – “I did this” – in discussing their businesses.

It’s that regional attitude of being in business together with a group of dedicated employees that naturally lends itself to forming an ESOP, Keeling suggested.

Lance Nixon Freelance writer Pierre, S.D. nixon_lance@yahoo.com

When

(L) AND STEVE BURIAN POSED FOR THIS PHOTO. TODAY, THEIR COMPANY – WHICH

How failure breeds success

Prairie Business asked the CEOs of four successful area startups for their take on failure. Their answer: They not only accept failure; they embrace it.

By Tom Regan

BISMARCK, N.D. – Asked to share what he considered one of his biggest failures, Garrett Moon, CEO of CoSchedule, responded he could share 10 of them.

“My partner and I launched 10 pieces of software that all failed before we created CoSchedule,” he said.

CoSchedule, a sophisticated calendar web app that coordinates marketing campaigns, hit it big. That was 2013. Today, the company (with offices in Bismarck and Fargo, N.D., and 65 employees) serves 10,000 clients in over 100 countries.

Customers include Microsoft, The Home Depot, Uber and eBay.

Failure is not just accepted at CoSchedule; it’s encouraged. “Most companies build their entire structure around risk mitigation versus experimentation,” said Moon. “For a team member to take risks and experiment, they have to know the company is willing to embrace failure. We empower our team to break things.”

Moon feels his employees learn more from failures than successes because the failures hurt more. “Successes are often easy to breeze over, and you don’t really reflect on them too much. But failures can hurt financially and emotionally.”

BNG Team

Brady Nash, CEO of BNG Team, preaches the benefits of taking risks. “I feel we’ve already shot five or six times before our competition has even fired a bullet,” said Nash.

“I’ve made myself comfortable being uncomfortable. In fact, I’m uncomfortable being comfortable.”

Nash’s company -- a leader in the payment processing industry, with clients in all 50 states, the UK, Australia and Canada – has been listed on the Inc. 5000 list of fastest-growing companies in America for the past three years.

GARRETT MOON, CEO OF COSCHEDULE COSCHEDULE'S OFFICES INCORPORATE THE SAME GRAPHIC SENSE THAT SETS THE COMPANY'S PRODUCTS APART. IMAGE: HALEY FROST CREATIVE

IN THIS SCREENSHOT FROM A BNG TEAM-PRODUCED

Mountain Plains LLC

MORE WISDOM ON FAILURE

“FAILURE MAKES YOU SMARTER AND MORE AGILE. IT KEEPS YOU ON YOUR TOES.”

– GARRETT MOON, COSCHEDULE

“IN ORDER TO SUCCEED SPECTACULARLY, YOU HAVE TO BE WILLING TO FAIL SPECTACULARLY.”

– BIZ STONE, TWITTER COFOUNDER

“SUCCESS CONSISTS OF GOING FROM FAILURE TO FAILURE WITHOUT LOSS OF ENTHUSIASM.”

– WINSTON CHURCHILL

“YOU NEVER FAIL IF YOU NEVER QUIT.”

– BRADY NASH, BNG TEAM

“FAILURE IS IN THE EYES OF THE BEHOLDER.”

– TONY WOOD, MOUNTAIN PLAINS, LLC

DOCUMENTARY, "HOW HARD COULD IT BE? THE BNG STORY," BNG TEAM EXECUTIVES (FROM LEFT) BRADY NASH, RYAN GOODMAN, TYLER BUECHLER AND RYAN THEIS POSE WITH A CREATURE THAT CAPTURES THE ENTREPRENEURIAL SPIRIT.

TONY WOOD, OWNER OF MOUNTAIN PLAINS, LLC.

AT MOUNTAIN PLAINS LLC, WHERE "FAILURE IS IN THE EYES OF THE BEHOLDER," AS OWNER TONY WOOD PUTS IT, STAFFERS USE VEHICLES SUCH AS THIS ONE TO DO THE COMPANY'S ENGINEERING, SURVEYING, ELECTRICAL AND OTHER WORK. IMAGE: MOUNTAIN PLAINS, LLC

Headquartered in Fargo with nearly 65 employees, the 11-year-old company is scheduled to move into a new building in December.

“I’ve always looked for reasons to do something, not for reasons not to do something,” said Nash, who cut his business teeth in network marketing during his college days at North Dakota State University.

A lot of people have ideas, but they try to have everything figured out before they take the plunge and move forward, Nash commented. “In my experience, you never have it figured out. Trying to figure it out prevents action.”

Mountain Plains, LLC

The steady growth of Tony Wood’s company, Mountain Plains, LLC, exemplifies the adage, “Necessity is the mother of invention.”

Beginning in 2009, as necessity called, the Idaho native methodically added one division after another: electrical consulting, land surveying, utility locating, engineering.

With 35 employees and offices in Bismarck, Watford City, N.D., and Missoula, Mont., Mountain Plains’ clients include electrical co-ops, pipeline companies, oil companies and transportation departments.

Wood pointed to his company’s experience of “hard bidding” on projects as an exercise in failure – at first. “We lost $20,000 on that first job, but we gained more than that in knowledge,” he reported.

“Our success as a company is defined by how we’ve responded to the mistakes we’ve made. If you get down on yourself too much for failure, then you don’t belong in business.”

Laughing Sun Brewing

Mike Frohlich, co-founder and head brewer of Laughing Sun Brewing, had a $40,000 brew system parked in his garage for three years before he found the found the right partner and location for Bismarck’s first brew pub, which opened in 2012.

Meanwhile, his first two partners dropped out. Another setback came two years ago when Frohlich and co-founder Todd Sattler believed they had secured the ideal building in Mandan, N.D., for expansion, only to have the deal fall through at the last minute.

Perseverance, patience and a passion for his vision kept Frohlich steady at the wheel. “I never dwelled on those things as failure,” said Frohlich about the misfires.

“If we all quit, nothing would get better. You just put your head down and get back to work.”

Laughing Sun recently announced it will open a much larger brewery and pub in the fall, complete with tap room, eating area and heated outdoor patio.

The centerpiece of the new Front Street location in Bismarck is a 20-barrel brew system – a significant increase over the brew pub’s current 3.5-barrel system.

Coincident with the move, Laughing Sun will begin statewide distribution of its beer through wholesalers. The business’s employee force will grow from 8 to 23.

“You’d better have a work ethic and some drive,” said Frohlich about being an entrepreneur. “You have to believe in what you’re doing and love it.”

Tom Regan Freelance writer Bismarck tregan@bis.midco.net

RIGHT: LAUGHING SUN BREWING CO. WAS STARTED IN 2012 BY OWNERS MIKE FROHLICH (L) AND TODD SATTLER (R). THE BREWERY IS EXPANDING THIS YEAR, MOVING TO A 20-BARREL BREW SYSTEM FROM THE CURRENT 3.5-BARREL SYSTEM. IMAGE: LAUGHING SUN BREWING BELOW: BEFORE LAUGHING SUN BREWING CO. OPENED IN 2012, BISMARCK, N.D., HAD BEEN WITHOUT A BREWERY SINCE THE 1960S. THE BREWPUB'S PRODUCTS INCLUDE 'FEAST LIKE A SULTAN' INDIA PALE ALE, 19TH AMENDMENT STOUT ("IN HONOR OF FEMALE CRAFT BEER SUPPORTERS EVERYWHERE," LAUGHING SUN'S WEBSITE NOTES) AND STRAWBERRY WHEAT. IMAGE: LAUGHING SUN BREWING

For KLJ, HQ is A-OK

by Tom Dennis

For five years, engineering firm KLJ has enjoyed occupying one of the most striking corporate headquarters in Bismarck, N.D.

Designed by JLG Architects in Grand Forks, N.D., the 80,000-squarefoot building was meant to accommodate KLJ’s rapid growth, said Sherry Kulish, KLJ’s facilities manager. The company had doubled in size over the previous few years and had expanded into four separate locations in Bismarck.

“Operating in separate locations challenged our ability to be efficient,” Kulish said.

A summary of the project on Architizer.com describes what happened next. “When asked how the building should represent them, the client offered words like ‘conservative, stable, substantial and trustworthy,’” the website reports.

“And so, the architects proposed a solution that would offer beauty and

permanence through the use of utility materials representative of KLJ’s civil engineering core – concrete, glass and steel – in a simple and elegant way.”

The building, which opened in 2013, features “an accessible green roof, permeable pavement, low flow fixtures, energy efficient appliances and lighting, and flooring, insulation, gypsum and cabinetry with recycled content,” according to Architizer.com.

With 28 offices across seven states, KLJ has come a long way from the basement of the Stark County Courthouse in Dickinson, N.D., which is where the company was launched in 1938.

Tom Dennis Editor, Prairie Business tdennis@prairiebusinessmagazine.com 701-780-1276

ALL IMAGES ARE COURTESY OF JLG ARCHITECTS AND KLJ

INSIGHTs & INTUITION

What’s the best way for an HR professional to keep up with changes in employment law?

Director of Human Resources and Associate Vice President of Finance & Administration Northern State University Aberdeen, S.D.

The best way for an HR professional to keep up with changes in employment law is to join a professional association such as the Society for Human Resource Management (SHRM) or College and University Personnel Association (CUPA).

The benefits that an HR professional can reap for a small annual membership fee are countless. These associations offer webinars, chat rooms, white papers and opportunities to meet colleagues with the same issues you have, all of which will help you keep up to date with current issues.

At WCCO Belting, we take a diverse approach, one that includes monitoring the information provided by the Society for Human Resource Management, consulting industry professionals, using electronic resources such as webinars and online forums, and classroom training via local seminars and lunch-and-learns.

Our department understands that staying current on employment law is a team effort, and more important, leadership prioritizes the continuing education of our employees on the subject.

As a growing business that’s hiring, we’re fortunate to have the support of our company when we have to suspend our daily job responsibilities for valuable learning opportunities.

Leiviska HR Director WCCO Belting, Inc. Wahpeton, N.D.

Susan Bostian

Jeremy

The internet offers a lot of employment law information, but the challenge is focusing on resources that are clear and concise. Some good ways to keep up with employment law include:

• The Society of Human Resources Management (SHRM) provides regular employment law updates on its website.

• Working with company legal counsel and networking with other HR professionals can provide relevant information on targeted topics such as state laws and issues unique to the business.

• Attending regional employment law conferences such as the annual Upper Midwest Employment Law Institute can give the professional extensive reference materials, legal discussions and great networking opportunities.

Kim Beck Director of Employee Relations Midco Sioux Falls, S.D.

One way is to join and participate with the Society for Human Resource Management. This is the world’s largest HR professional society representing members in over 165 countries. The organization not only provides education and certification for members, but also lobbies Congress on issues pertinent to labor management.

And SHRM’s website is a valuable tool for every HR professional. In North Dakota, HR professionals can attend seminars that are given by local law firms that know and understand the state and federal labor and employment laws as well as benefits. Dorsey & Whitney holds annual seminars, and Vogel Law Firm holds biennial employment-law updates in Fargo and Bismarck. Last but not least, HR professionals can join their local human resource associations. This is a great way to share information and network with other professionals. The local chapters or groups also provide professional development opportunities.

Susanne Straus

Employee Relations Specialist Minnkota Power Cooperative Grand Forks, N.D.

Small Town BeginningsWorldwide Achievements

What started as a small aggregate business in rural North Dakota, has evolved into an all-encompassing aggregate and land development enterprise with offices and commercial pits in 9 states. Led by visionaries who dream big and are not afraid to think outside the box, we continue to welcome challenges and tackle the industry’s toughest jobs. Bridges, levees, roads, and walls; we do it all! Learn more about us at www.fisherind.com.