In Business Magazine - January 2012

JAN. 2012

Is Retail Profiting? | E-Verify's Safeguards and Shortcomings

INDUSTRIES

LEADING

OUR WAY Key sectors promise strength for Arizona’s economic future

Arizona’s Economic Heritage Power Lunch | By the Numbers | Business Calendar This Issue Scottsdale Area Chamber of Commerce Arizona Small Business Association

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January 2012

www.inbusinessmag.com In Business Magazine is a collaboration of many business organizations and entities throughout the metropolitan Phoenix area and Arizona. Our mission is to inform and energize business in this community by communicating content that will build business and enrich the economic picture for all of us vested in commerce.

Partner Organizations

Donna Davis, CEO Arizona Small Business Association Central Office (602) 306-4000 Southern Arizona (520) 327-0222 www.asba.com

Steven G. Zylstra, President & CEO Arizona Technology Council One Renaissance Square (602) 343-8324 • www.aztechcouncil.org

Kristine Kassel, President NAWBO Phoenix Metro Chapter (602) 772-4985 • www.nawbophx.org

Rick Kidder, President & CEO Scottsdale Area Chamber of Commerce (480) 355-2700 • www.scottsdalechamber.com

Mary Ann Miller, President & CEO Tempe Chamber of Commerce (480) 967-7891 • www.tempechamber.org Our Partner Organizations are vested business organizations focused on building and improving business in the Valley or throughout Arizona.

As Partners, each will receive three insert publications each year to showcase all that they are doing for business and businesspeople within our community. We encourage you to join these and other organizations to better your business opportunities. The members of these and other Associate Partner Organizations receive a subscription to In Business Magazine each month. For more information on becoming an Associate Partner, please contact our publisher at info@inbusinessmag.com.

Associate Partners Ahwatukee Foothills Chamber of Commerce www.ahwatukeechamber.com Arizona Chamber of Commerce & Industry www.azchamber.com Arizona Hispanic Chamber of Commerce www.azhcc.com Chandler Chamber of Commerce www.chandlerchamber.com Economic Club of Phoenix www.econclubphx.org Glendale Chamber of Commerce www.glendaleazchamber.org Greater Phoenix Black Chamber of Commerce www.phoenixblackchamber.com Greater Phoenix Gay & Lesbian Chamber of Commerce www.gpglcc.org Mesa Chamber of Commerce www.mesachamber.org North Phoenix Chamber of Commerce www.northphoenixchamber.com North Scottsdale Chamber of Commerce www.northscottsdalechamber.org Peoria Chamber of Commerce www.peoriachamber.com Westmarc www.westmarc.org

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J a n u a r y 2012

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January 2012

INDUSTRIES LEADING OUR WAY

22

Industries Leading Our Way

JAN. 2012

IN BUSINESS MAGAZINE

Contents

Is Retail Profiting? | E-Verify's Safeguards and Shortcomings

IndustrIes

LeadIng

Our Way Key sectors promise strength for Arizona’s economic future

Arizona’s Economic Heritage

JANUARY 2012 • inbusinessmag.com

Arizona needs to move away from a dependence on tourism and construction, and RaeAnne Marsh talks with the leaders helping shape the state’s future economy on a more diverse and stronger base within the targeted sectors of science and technology, aerospace and defense, renewable energies, and small business and entrepreneurship.

Power Lunch | By the Numbers | Business Calendar This Issue

Scottsdale Area Chamber of Commerce Arizona Small Business Association

Departments

11 Guest Editor

Vicki E. Panhuise, Ph.D., chairman of the Arizona Aerospace and Defense Commission and president and owner of VePoint Consulting Group, introduces the “Industries Leading Our Way” issue.

Features

42 Assets

2012 Jeep Grand Cherokee SRT8 and business calendars for 2012

28 The Path of Arizona’s Economic Heritage 12 Feedback Arizona’s “five C’s” — cattle, citrus, climate, copper and cotton — were the commercial strongholds that defined the state’s early economy. Brett Maxwell examines the significance of these industries in today’s Arizona.

Noted business leaders Lee Fraley, Donn Frye and Jeffrey P. Gaia respond to IBM’s burning business question of the month.

14 Briefs

20 In the Market for Retail

“Electric Vehicle Charging Station Study Recruits Phoenix Businesses,” “New Local Website Offers Insurance Info,” “100%-Commission Commercial Real Estate Firm Emerges,” “Art Event Paints a Broad Stroke for Local Economy,” “Mesa Company Bids on Unique Business Model” and “Building Business between the Lines”

It may take resurgence in the housing industry to power up the retail scene, Alison Stanton finds in her look at merchant trends and strategies. Plus: Watching traffic as a key retail analytic.

20

30

18 By the Numbers

The case for tax credit programs. Plus: Key economic indicators provide a sense of the health of the local economy.

30 Attract and Keep the Best and

32 Trickle Up

the Brightest

Good healthcare benefits do both recruiting and retention.

Respected benefits consultants discuss with Gremlyn Bradley-Waddell various options and considerations for business owners to keep in mind.

View from the top looks at how Executive Forums principals John Cosgrove and Rick Johnson build others up for success.

SCOTTS

DALECH AMBER. COM

Special Sections

45 Scottsdale Area Chamber of Commerce 55 Arizona Small

Business Association

Redefi ning

MEM BER COM MUN Key A IQUÉ re

Value

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Celeb

Centr

4600

Phoe

31 Books

New releases on leadership explore the traits of high-profile leaders and skills that foster success.

34 Nonprofit

Children’s Cancer Network Thunderbird Charities

44 Power Lunch

“Durant’s: Classic Lunch in Time.” Plus: “Resolution: Do a Healthy Lunch”

66 Roundtable

“E-Verify: Safeguards and Shortcomings” Business Education

38 Great Brands Don’t Start

With Art

Marketing and communications coach Kathy Heasley explores the importance of the visuals that surround your brand in this fourth of her six-part series.

40 Silos as Structures for

Better Prospecting and Sales In this third of his six-part series, sales coach Mike Toney shows how to increase effectiveness by segregating sales functions.

Networking

35 On the Agenda

January’s calendar of business events presented by our partners

01

8

J a n u a r y 2012

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January 2012 • Vol. 3, No. 1

AccelerAte

revenue & Business Growth

throuGh systems Installing fun systems that grow revenue!

Developing the people you have!

Customer Service people that really up-sell!

Hiring sales people that can & will sell!

Accelerating Business Performance Through Innovative Thinking

Publisher Rick McCartney Editor RaeAnne Marsh

Art Director Benjamin Little

Contributing Writers Gremlyn Bradley-Waddell Kathy Heasley Mike Hunter Sue Kern-Fleischer Alison Stanton Mike Toney

Photographer-at-large Dan Vermillion

Meet with us.

After one hour you will know more, produce more and see if we fit.

(602) 840-0003 www.conquesttraining.com © 2011 Conquest Training Systems, Inc. Phoenix, Arizona

Editorial Intern Brett Maxwell

Advertising Operations Louise Ferrari

lferrari@inmediacompany.com

Senior L ouise Ferrari Account Executives lferrari@inmediacompany.com

April Ray

aray@inmediacompany.com

Cami Shore

cshore@inmediacompany.com

Greg Stiles

gstiles@inmediacompany.com More: Visit your one-stop resource for everything business at www.inbusinessmag.com. For a full monthly calendar of business-related events, please visit our website.

Inform Us: Send press releases and your editorial ideas to editor@inbusinessmag.com.

President & CEO Rick McCartney Editorial Director RaeAnne Marsh Senior Art Director Benjamin Little

Corporate Offices 6360 E. Thomas Road, Suite 210 Scottsdale, AZ 85251 T: (480) 588-9505 F: (480) 584-3751 info@inmediacompany.com www.inmediacompany.com

Vol. 3, No.1 . In Business Magazine is published 12 times per year by InMedia Company. POSTMASTER: Send address changes to InMedia Company, 6360 E. Thomas Road, Suite 210, Scottsdale, AZ 85251. To subscribe to In Business Magazine, please send check or money order for one-year subscription of $24.95 to InMedia Company, 6360 E. Thomas Road, Suite 210, Scottsdale, AZ 85251 or visit inbusinessmag.com. We appreciate your editorial submissions, news and photos for review by our editorial staff. You may send to editor@inbusinessmag.com or mail to the address above. All letters sent to In Business Magazine will be treated as unconditionally assigned for publication, copyright purposes and use in any publication, website or brochure. InMedia accepts no responsibility for unsolicited manuscripts, photographs or other artwork. Submissions will not be returned unless accompanied by a self-addressed, stamped envelope. InMedia Company, LLC reserves the right to refuse certain advertising and is not liable for advertisers’ claims and/or errors. The opinions expressed herein are exclusively those of the writers and do not necessarily reflect the position of InMedia. InMedia Company considers its sources reliable and verifies as much data as possible, although reporting inaccuracies can occur; consequently, readers using this information do so at their own risk. Each business opportunity and/or investment inherently contains certain risks, and it is suggested that the prospective investors consult their attorney and/or financial professional. © 2012 InMedia Company, LLC. All rights reserved. No part of this magazine may be reproduced or transmitted in any form or by any means without written permission by the publisher.

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J a n u a r y 2012

inbusine ssmag.com

Vicki E. Panhuise, Ph.D., President and Owner, VePoint Consulting Group, LLC

Guest Editor

Attracting and Retaining the Best

Vicki E. Panhuise, Ph.D., retired from Honeywell Aerospace in January 2011 after 30 years in multiple roles in engineering, program management, operations and business leadership. A member of the American Society of Nondestructive Testing, she served as a national officer from 1990-1995, holding the title of president and chairman of the board. Active with economic development in Arizona, Panhuise serves on the Arizona Commerce Authority Board of Directors in addition to her Commission role.

Over the years, Arizona has built its economy on products and industries such as cotton, copper, tourism and real estate. We have quickly become one of the fastest-growing states in America, but our industry focus has shifted. Arizona’s economy is more diverse and more advanced, with emphasis on sectors that will position our state as a major player in the global marketplace, ensuring a more stable economic outlook, but we cannot forget those pioneering industries that have shaped Arizona for decades. This issue of In Business Magazine not only highlights Arizona’s future, it takes a close look at its past.

The cover story, “Industries Leading Our Way,” by In Business Magazine editor RaeAnne Marsh, is an indepth look at the top industries that government and business organizations are encouraging, believing they are key to attracting and retaining great talent, economic prosperity and opportunities that will sustain our growth.

Supporting the primary focus areas of technology, aerospace, renewable energy and entrepreneurship, among these sustainable industries are the telecom industry — robustly represented by Cox and Verizon as well as companies such as Mitel and Microsoft that create products and programs — and the renewable energy sector whose growth continues to populate the headlines.

Arizona’s aerospace and defense (A&D) industry has grown significantly due to competitive advantages — our desert climate, terrain and open spaces — and commercial aviation, defense, space exploration and other A&D-related industry have found a home in Arizona. The cover story also explores the ongoing importance of this industry, which contributes $8.8 billion in gross state product to our economy and represents 93,800 jobs.

Arizona has many large A&D companies, including Boeing, Raytheon Missile Systems, Honeywell Aerospace and General Dynamics C-4 Systems, as well as seventeen military installations. The Arizona Aerospace and Defense Commission continues to collaborate with industry, academia and government to align our business environment, research competitiveness, small business pipeline and workforce capabilities to sustain and grow this significant industry within our state.

Brett Maxwell takes a look back, reminding us of our economic legacy with his article on the “five C’s”: cattle, copper, citrus, cotton and climate; how each remains profitable for the state; and how each still impacts Arizona’s overall economy. Of course, attracting and retaining employees is critical to growing and sustaining any successful business, and Gremlyn Bradley-Waddell writes of the importance of employee benefits when it comes to hiring and engaging staff. Alison Stanton explores the health of the local retail industry in our Sector feature, talking with merchants in a variety of retail environments as well as large retail development and management companies. And in this month’s Trickle Up column, Sue Kern-Fleischer profiles John Cosgrove and Rick Johnson, who, as principals of Executive Forums, have earned a solid reputation for helping C-level executives advance to where they want to be, both in business and in their personal life, by leveraging best practices and other tools to ensure success.

We are in a time when doing things better and smarter matters. This issue of In Business Magazine is a hands-on resource for knowledge to help direct us toward that end. I hope you enjoy this January 2012 issue.

Sincerely,

Vicki E. Panhuise, Ph.D. Chairman, Arizona Aerospace & Defense Commission President and Owner, VePoint Consulting Group, LLC

2012 Is Our Year A new year can make all the difference. 2012 is the year we celebrate Arizona’s centennial, a milestone often marked by businesses taking on new initiatives. 2011 is over. Here’s to 2012.

Building business in a way that will truly sustain our economic growth over the next several years is something that many state and business organizations are working to accomplish. It seems our lessons have been learned, and the current devastating economic crunch may have opened

inbusine ssmag.com

our collective eyes to what we need to be focused on to grow our work force, encourage long-lasting industries and strengthen Arizona’s economic foundation beyond tourism and construction.

RaeAnne Marsh’s story on industries targeted to lead the way gives us hope that we are getting it right.

Thank you to Vicki Panhuise for her leadership and innovation in strengthening our economy through her efforts in aerospace and defense right here in Arizona. She sets a great example for the types of change that will ensure success for Arizona’s economy.

—Rick McCartney, Publisher

Connect with us: Story Ideas/PR: editorial@inbusinessmag.com Business Events/Connections: businessevents@inbusinessmag.com Marketing/Exposure: advertise@inbusinessmag.com Or visit us online at www.inbusinessmag.com

J a n u a r y 2012

11

Feedback

Valley Leaders Sound Off

Executives Answer

Lee Fraley

Business sectors that have been identified by state and regional economic development agencies as important for ongoing economic strength include renewable energy, technology, aerospace, biosciences and financial services, and they are actively seeking to encourage growth in those areas. How do you anticipate such growth will impact your business sector?

Donn Frye

Partner, Snell & Wilmer Sector: Law

The anticipated growth should have a positive impact on the legal industry.

Full-service law firms, like Snell & Wilmer, are already working with clients in most, if not all, of the target industries.

The nature of the growth will drive the specific practice areas in highest demand.

Workforce/geographical expansion, mergers and acquisitions, and the introduction of new products and technologies usually characterize periods of growth. Consequently, legal services addressing labor, business and finance, intellectual property and real estate/ construction issues will be critical. In technology, for example, as companies integrate new platforms such as cloud computing, they will need to balance productivity goals with data security concerns. Law firms should be able to play a leading role in addressing the regulatory complexities surrounding this issue.

The target sectors can stimulate growth within other areas, such as health care and education, which will require experienced legal counsel to identify and maximize opportunities. This sector growth will provide law firms with unique opportunities to respond to the evolving business needs and requirements of clients and their respective markets.

CEO, Prestige Cleaners Sector: Retail Services

The pursuit of the development of several key industries will have a favorable impact on our industry as a whole. For instance, at Prestige Cleaners, many of our customers are professionals, in the financial service sector as well as high-tech industries that require the associates to wear professional attire.

Many services in our market area should reap the benefits of new and developing businesses that employ higher-income staff. This would afford larger disposable income that would support the Valley through shopping, dining and recreation.

It is the small businesses in our community that provide the necessary continuity between the major businesses and the overall health of our community. Growth and success is essential for our small businesses as they so often support, strengthen and add to the characteristic and quality of the community itself.

Prestige Cleaners, Inc. prestigecleaners.com

Snell & Wilmer, L.L.P. swlaw.com

Lee Fraley is a partner at the law firm of Snell & Wilmer. He counsels clients on intellectual property matters, provides IP rights enforcement and defense services, and negotiates IP-related transactions such as licensing, financing and acquisitions. In recent years, he has counseled numerous emerging and growing businesses throughout the United States and abroad in the development of patent, copyright and trademark portfolios.

Jeffrey P. Gaia

Chairman & CEO, The Biltmore Bank of Arizona Sector: Banking

I’m encouraged by the efforts of the state and regional economic development agencies to identify and target high-value industries.

The Arizona economy is already more diverse than the national media gives us credit for, and I’m hopeful that these efforts will create a sustainable and long-term economic impact.

As an Arizona-based business bank, we believe these efforts could have a huge impact. Any time new businesses are being created, the

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J a n u a r y 2012

Donn Frye is CEO of Prestige Cleaners, which his family founded in 1964 after moving to Scottsdale from Columbus, Ohio. Frye is active on the advisory boards of Scottsdale/Paradise Valley YMCA and Scottsdale Training and Rehabilitation Services in addition to holding membership in Scottsdale McCormick Ranch Kiwanis Club, Scottsdale Charros, the national Dry Clean and Laundry Institute and the Western States Dry Cleaning and Laundry Association.

banking sector benefits because business formation and growth is dependent on access to capital. Whether that is through infrastructure investments, business lending or business finance and restructuring, the financial services and banking industries are an integral part of Arizona’s positive growth options.

Currently, we work with businesses in each of these sectors and we’ve seen firsthand the economic impact renewable energy, technology, aerospace and biosciences are having on the local economy. Economic growth depends on productive investment, and, to the degree that we can encourage and develop business investment in Arizona, I’m optimistic.

The Biltmore Bank of Arizona biltmorebankaz.com

Jeffrey P. Gaia is chairman and chief executive officer of The Biltmore Bank of Arizona, a community bank he co-founded in 2003. He has 30 years’ experience, 25 in the financial services industry. A resident of Paradise Valley, Gaia has a Bachelor of Science degree from the University of Missouri and an M.B.A. from St. Louis University.

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Employed Worker Training Keeping You on the Cutting Edge Many industries responded to the recession by investing in new technologies. Maricopa County’s Employed Worker Training Program (EWTP) may be able to assist a business, or a group of businesses, drive productivity and maximize their investment by increasing the skills of their current workforce to better use new technologies. Participating employers may be reimbursed up to 50 percent of eligible costs for providing training for in-demand jobs and occupations.

The federal Workforce Investment Act makes EWTP grants available to employers working with Maricopa Workforce Connections.

The amounts awarded are based on factors such as employer size, benefits package and the number of employees requiring training. Grant applications are taken on a first-come, first-served basis and are awarded based on the availability of funds at the time the application is approved.

Call today to learn if your company is eligible to benefit from MWC’s Employed Worker Training Program!

Who Can Apply?

What Are The Requirements?

An employer, excluding government agencies, with business locations within Maricopa County.

The employer or group of employers must be contractually obligated to participate.

A consortium of employers, professional or trade associations with same or like training needs.

Employer agrees to sponsor a minimum of 50% of the training costs.

Part of Arizona’s Workforce Development Network

More than 20 years of helping area businesses succeed.

Call (602) 506-WORK to schedule a meeting with a local workforce professional!

Equal opportunity employer/program. Auxiliary aids and services are available upon request to individuals with disabilities.

MWC products and services are made available through federal funding provided by the Workforce Investment Act.

Briefs

Quick and to the Point the original focus, Weaver says that “since all that includes attorneys,” they may add information on attorneys and prepaid legal services to the website.

Visitors remain anonymous, as no data is collected by the website, and information is presented with no bias toward or against particular businesses — a key attribute in the decision by the Securities and Exchange Commission to approve the request by an investment consultant who wanted to advertise on the website. Articles are original for insuranceinfodesk.com, written to address timely issues, and articles by advertisers may be considered as long as they, too, meet that editorial criterion.

—RaeAnne Marsh InsuranceInfoDesk insuranceinfodesk.com

Electric Vehicle Charging Station Study 100%-Commission Recruits Phoenix Businesses Phoenix is one of 18 major cities and metropolitan areas to be part of The EV Project, collecting and analyzing data on electric vehicle use and evaluating various charge infrastructures and related revenue systems. ECOtality, a San Francisco-based company awarded a grant of $99.8 million from the U.S. Department of Energy for this study in 2009, has begun distributing electric vehicle charging stations at no cost to selected businesses and electric vehicle owners here. “Our goal for Arizona is 2,100 charging stations [for businesses] and 900 for individuals,” says Marc Sobelman, ECOtality area manager for Arizona.

“Hosts volunteer because having a charging station is a differentiator,” says Sobelman, observing that many businesses are trying to be seen as “green.” “It’s a great message to send customers and employees.”

Most are Level 2 charging stations, which take two-and-a-half hours to give a 50 percent charge, so ECOtality is concentrating on “places where people are already going” in the normal course of their activities, Sobelman explains, also noting the importance of being able to place the charging station in a safe, well-lit location. There will also be 25 DC Fast Chargers, which give the 50-percent charge in just 10-15 minutes. ECOtality will take care of installation and reimburse the hosts for operating costs.

—RaeAnne Marsh ECOtality ecotality.com The EV Project theevproject.com

New Local Website Offers Insurance Info

The just-launched insuranceinfodesk. com is a one-stop resource for individuals and businesses looking for timely and unbiased information about insurance, payroll and a variety of human resources topics.

The website is a collaboration between Bill Weaver, a benefits consultant who wanted to provide dependable information to clients with payroll questions, and Michael Migdol, a payroll specialist who was similarly seeking

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suitable authority for business clients asking about employee benefits. The two men combine their complementary expertise to address these questions their clients have posed — and expect to constantly expand the glossary and FAQs on this free resource in response to new questions from individuals and businesses as they arise. If a visitor asks for information not on the site, says Weaver, “We will put it on there.”

While payroll and benefits, including an explanation of such topics as casualty insurance and workers compensation, were

Commercial Real Estate Firm Emerges

The Benjamin Group, self-described as a “low-profile, high-value, high-integrity organization,” has changed its name and tweaked its concept to become City to City Commercial — a commercial real estate brokerage based in Scottsdale.

Chris Benjamin has partnered with Bill Olsen to convert The Benjamin Group to this new company that will implement a 100-percent-commission model. “This concept allows agents to retain more of the real estate commissions they earn, while paying their own costs along the way,” says Benjamin, who will remain as president and designated broker. According to Benjamin, that model is a proven, winning strategy underused and underserved in commercial real estate.

City to City states that current average commercial real estate agents pay 30 to 50 percent of their commissions to the brokerage company they work for. This old model of sharing commissions was meant to attract established and successful agents, but Benjamin questions its efficacy. The new model will be fee-based for the commercial agents who come aboard. “I want to surround myself with people who perform and are professionals who understand this business,” says Benjamin.

“This model puts skin in the game for agents and provides the firm with representatives who know they need to drive business.” Several residential real estate firms are based on this 100-percent model. RE/MAX has become >> inbusine ssmag.com

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Briefs

Quick and to the Point

one of the world’s most successful real estate companies using this model because it brings them a candidate who is market-savvy and understands what it means to run a business.

City to City plans to grow this model nationally. “There is no better time to be in this business,” says Olsen. “It is moving in a positive direction as many banks divest of their REO assets.” The firm is currently hiring agents under this model.

—Mike Hunter City to City Commercial citytocitycre.com

Mesa Company Bids on Unique Business Model

Auction Empire is combining the convenience of technology with the excitement of live bidding, bringing public auctions into the 21st century and giving customers another choice in the online and public auction industries. The new Mesa-based company offers bidders a choice to participate in-person or join the same auction via the Internet.

Auction Empire’s ability to accommodate Internet customers and onsite customers simultaneously is a unique quality that other local auction companies cannot offer. “We’re just trying to make a more user-friendly auction house,” Brent DeWitt, owning partner of Auction Empire, says. The company broadcasts bi-monthly warehouse auctions held at its 33,000-square-foot facility live on the Internet, so online bidders can take part in the action. The company also offers monthly online-only auctions.

The facility offers auction goers amenities not typically found at a public auction. “All of the other auctions on the west side [of town] are outdoors, and in the summertime it’s hotter than heck,” DeWitt says. “At our auction site, [people] can come in and sit down in air conditioning and grab something to eat [at our full-service restaurant].” Those who wish to attend the onsite auction can relax in stadiumstyle seating while viewing the live action on 55-inch LCD monitors. Potential bidders are allowed to preview the items up for bid at the warehouse auctions one day prior to the event.

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Art Event Paints a Broad Stroke for Local Economy The Celebration of Fine Art has packed up its big white tents and is moving its event, which averages $5 million a year in revenue, to a new 40,000-square-foot location that will house art studios and works of art. The event, to be held on the southwest corner of Hayden Rd. and the Loop 101 in Scottsdale starting Jan. 14 and running through March 25, brings in more than 50,000 visitors from across the country during its annual 10-week showcase of works from nearly 100 artists who temporarily call the event home.

Susan Morrow Potje, co-owner and show director, says about half of the event’s visitors and artists who come each year are from out of town. Art enthusiasts have come from as far as Japan and the U.K. “[Artists and visitors who come from out of town] are either renting short-term leases or staying in local hotels and eating out quite a bit, so the overall flow into our economy is quite significant,” Potje says. According to the latest survey by the Celebration of Fine Art, an out-of-town visitor stays an average of 7 to 10 days for the event.

The 22-year-old event creates a unique experience that allows visitors, who range from serious collectors to first time buyers, to interact with the artists directly. Art enthusiasts are able to learn the process and techniques artists use to create a piece of work.

—Brett Maxwell Celebration of Fine Art celebrateart.com

The company will also perform real-estate, offsite and charity auctions. For businesses looking to reduce inventory and liquidate assets, Auction Empire can offer its services to help. Participants will be able to bid on cars, equipment and a wide variety of general merchandise.

—Brett Maxwell Auction Empire auctionempire.com

Building Business between the Lines

We Do Lines is the first national operation focused solely on parking lot striping, and Tom Cox is bringing its first franchise to Arizona. Although parking lot striping is a $1 billion industry, it’s often an afterthought in construction projects, which is what inspired company founders Chris Couri and Dan Rella to launch a company focused solely on striping. Their business in Connecticut needed its parking lot striped, but phone

messages to providers of this service went unreturned. Turning frustration to research, they discovered there was no national company devoted to this service — so in 2008 they filled that niche. The Connecticut-based company has expanded to other states and also developed a franchise model.

And in 2011, Tom Cox chose to carve his franchise territory around Phoenix. “I talked to people in the asphalt and seal coat industries. They may do their own striping, but they don’t necessarily want to — but they don’t get paid until the job is done, and that includes striping,” he says, noting it’s done as time permits but “it’s not so scheduled.”

There is plenty of demand even in the current construction climate, as owners restripe to keep parking lots looking sharp, especially important when a business owner is trying to sell a property, or reconfigure their parking lots to improve the traffic pattern or create more spaces.

—RaeAnne Marsh We Do Lines wedolines.com

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J a n u a r y 2012

17

By the numbers

Quick and to the Point

Take the Tax Credit: Arizona is Giving Back to Schools The State of Arizona has a number of tax credits, monies paid into eligible programs as outlined by the Department of Revenue allowing the taxpayer to credit a portion of his or her annual state tax return. The tax credits can be applied to programs for the working poor, health insurance, renewable energy and public schools.

In 2010, Arizona individual income tax credits among all categories totaled $243,703,091.

Some of the credits are publicized well, encouraging taxpayers to spend their money on programs they support or that benefit their businesses. The state legislature has passed various laws whereby these credits incentivize the Arizona taxpayers to identify the programs they wish to support — and, ultimately, it costs the taxpayer nothing. The taxpayer receives a credit on his or her tax return equal to the amount of the contribution per the statutory guidelines.

A credit is not a deduction. Credits are either refundable or nonrefundable. If refundable, the contribution may be paid out to the taxpayer on his or her tax refund payment (if the obligation is less than the deductions and credits combined). If the credit is nonrefundable, the taxpayer may not receive a refund but may carry the credited amount for a number of years based on the tax credit statute used.

Key Indicators

Of the school tax credits, there are two available to individuals — one for contributions to public schools and charter schools, and the other for private school tuition organizations.

The public school and charter school contributions must support extracurricular activities or character education programs.

These are programs that require a fee to participate or are character-based meeting some unique guidelines expressed within the state statute. The maximum contribution for a married couple filing jointly is $400; for an individual, $200. In 2010, there were 249,995 individual taxpayers in Arizona who claimed this credit, for a total of $43,716,767.

An individual may claim a credit for making a donation to a school tuition organization for scholarships to private schools. The maximum credit amount that may be taken for tax year 2011 is $500 for a single, unmarried head of household and those who are married but filing separately; for those who are married and filing jointly, the maximum is $1,000.

This amount may change for tax year 2012. In 2010, there were 62,959 individual taxpayers in Arizona who claimed this credit, for a total of $43,177,050.

—Mike Hunter

Key indicators for the Metro Phoenix economy are provided in each issue to identify those key numbers that give readers a sense of the health of our local economy.

Economic Indicators (Metro Phoenix)

Number

Unemployment (Oct. 2011)

9.0%

-0.7

Job Growth (in thousands) (Oct. 2011)

2,420

1.8

No. of Housing Permits (Sept. 2011)

912

n/a

Consumer Confidence* (Oct. 2011)

57%

n/a

Consumer Price Index** (US) (Oct. 2011)

226.4

3.5

Eller Business Research

Retail Sales (Arizona) August 2011

Total Sales

6,184,808

8.7

Retail

3,761,612

8.8

Food

958,968

4.6

Restaurants & Bars

728,203

3.7

Gasoline

736,026

19.7

Contracting

882,820

18.9

Eller Business Research

Real Estate

Arizona Department of Revenue azdor.com

Public & Private School Tax Credit Dollars 2008

2007

2006

2005

2004

249,995

239,031

233,450

214,356

218,664

215,369

213,987

credit available

$43,716,767

$42,657,087

$45,164,366

$44,069,896

$43,230,433

$35,416,279

$30,958,872

credit used

$43,716,767

$42,657,087

$45,164,366

$44,069,896

$43,230,433

$35,416,279

$30,958,872

$0

$0

$0

$0

$0

$0

$0

carry forward

Private School Tuition Organization 2010

2009

2008

2007

2006

2005

2004

62,959

73,430

78,407

76,065

73,617

69,239

63,830

credit available

$43,177,050

$50,880,647

$55,261,284

$54,303,282

$51,011,815

$42,194,898

$31,846,070

credit used

$43,177,050

$50,880,647

$55,261,284

$54,303,282

$51,011,815

$42,194,898

$31,846,070

$0

$0

$0

$0

$0

$0

$0

# of claims

carry forward

Arizona Income Tax Credits Report by the Arizona Department of Revenue, Office of Economic Research and Analysis — November 2011

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Q3 2010

28.1%

27.9%

Net Absorption (in SF)

374,230

-86,775

Rental Rates (Class A)

$24.04

$25.09

Commercial: Indust.***

Public School Extra-Curricular Activity # of claims

Q3 2011

Vacancy Rate

The following are tax credit totals for public and private school tuition organizations since 2004.

2009

YOY % Change

Retail Sales (in thousands)

Commercial: Office***

2010

YOY % Change

Vacancy Rate

Q3 2011

Q3 2010

13.1%

14.4%

1,166,100

2,157,929

$0.52

$0.54

Nov. 2011

Nov. 2010

6,977

6,314

Total Median Sale Price

$128,750

$129,940

New Build Sales Volume

642

466

New Median Sale Price

$227,178

$219,175

6,335

5,848

$119,900

$122,000

Net Absorption (in SF) Rental Rates (General Industrial)

Residential: Total Sales Volume

Resale Sales Volume Resale Median Sale Price

* Rocky Mountain Poll ** Consumer Price Index refers to the increase or decrease of certain consumer goods priced month over month. *** Cassidy Turley/BRE Latest data at time of press

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At Waste Management, giving back is a responsibility we take to heart.

Learn more at www.wmofarizona.com

A community partner.

Waste Management is a valued and trusted community partner. Every year, we give back tens of thousands of dollars to community organizations in need.

Waste Management is proud to support Big Brothers Big Sisters of Central AZ, the Special Olympics, Keep Phoenix Beautiful and Habitat for Humanity.

1-800-796-9696

Š2010 Waste Management, Inc.

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J a n u a r y 2012

19

Sector

Industry at Its Best

The Market for Retail

Merchants and retail developers focus on the positive as they wait for a turnaround in the housing market

by Alison Stanton The holiday season’s collective economic focus is on retail. In fact, stories about how much shoppers are, or are not, spending have become about as predictable every year as Santa’s arrival at the local mall.

This seasonal focus on retail makes sense since many retailers use data from this time of year to determine whether or not they’ve had a good year.

So, how is retail doing in Arizona? There have been plenty of dismal reports during the recession, but the good news — according to those who live and breathe retail every day — is many businesses are holding their own. Sales are going up slowly but surely, and, in some cases, customers never stopped buying.

David Malin, director of acquisitions and development for Vestar Development Co. — which owns or manages more than 20 million square feet of open-air retail shopping centers in Arizona, Southern California and Las Vegas, including Desert Ridge Marketplace and Tempe Marketplace in the Greater Phoenix area — says the retail sector in the Phoenix market is

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generally “much improved,” with most projects experiencing a 5-percent to 10-percent increase in overall sales volumes as compared to 2010 as they head into the holiday season.

“The biggest challenge that remains for all retail developers in the Phoenix market is the housing market is only in the very beginning stages of a recovery,” says Malin, explaining that, while the amount of foreclosures is slightly down and vacant homes are starting to fill up with renters, there is little to no construction of new homes. “We need the job market to continue to improve and expand, which will create demand to absorb the remaining vacant homes, which will, in turn, spark the need for new homes to be built.”

And the more people there are who move to Phoenix, the more customers there will be to purchase goods from the stores.

Only a handful of new retailers have entered the Phoenix market in the past few years, but existing retailers who want to expand have been able to take advantage of lower rent opportunities, says Malin, who cites Ross, TJ

Maxx and Total Wine as examples. Others have taken advantage of opportunities to move to a better location, made possible as some merchants have shut their doors. A walk through the Esplanade at Camelback Road and 24th Street has an almost ghost-town feel with all the retail vacancies, even as new projects Scottsdale Quarter in Scottsdale and CityScape in Phoenix fill up.

According to Michelle Ahlmer, executive director of Arizona Retailers Association, which represents retailers statewide before policymakers, the word is that many retailers looking to expand are nervous about coming here. “I’ve heard from retail developers that, when they go out to other states or are here looking to do a project, when they mention Arizona they can hear crickets.”

But it’s a different picture from a variety of smaller retailers who are already here. Vendors of goods as varied as CDs, lighting, lingerie and jewelry report that, while there have been challenges along the way, things are looking pretty positive overall.

Expansion is definitely on the mind of Brian Faber, part owner and general manager of Zia Record Exchange, which opened in 1980 in Central Phoenix at a small storefront and now has four locations in Greater Phoenix, two in Tucson and two in Las Vegas. Reporting the company is doing very well, he says, “We are even in the process of looking to expand one of our Phoenix locations and potentially open another.” Zia’s strength is its used products; its core business is buying, selling and trading music, movies, games, books and collectibles, and Faber believes its relationship with the customers is what has helped Zia succeed over the past 30-plus years. “As a small business we are able to respond to customer needs and changes in shopping habits quicker than big-box retailers and thus stay relevant in an ever-changing retail environment,” he says.

Valerie Griggs, founder and CEO of 20 Lounge Nail Bar and Boutique, located in the Seville Plaza shopping center in Scottsdale, also reports business is good. Attributing her store’s success to the fact that, despite the shaky economy, many people are not giving up certain services, she says, “This is an affordable treat. People still want to take care of their hands, face and feet, and people will still go out and do something that makes themselves feel good.”

The two main bumps in the road that Griggs has dealt with since opening in November inbusine ssmag.com

2009 are an unanticipated but definite lull in business during the summer and learning that customers want to work with someone who has outstanding customer service skills rather than just being a licensed aesthetician. She implemented a new marketing strategy for the summer, holding special events to bring people in and then encouraging them to book their next appointment before they left. “I’ve also had to change the idea of what ideal staff means,” she says.

Collin Herdt, owner of Premier Lighting, which opened for business in 1978, also sees a predictable downturn in business during the summer months. But when fall and winter roll around, the snowbirds come back to town and people think about sprucing up their homes with new lighting for the holiday season, sales start to pick up again. “People have tightened up a bit on what they are spending, but the last couple of months have come back strongly. It’s not ‘2005-2006’ better, but it is better,” he says.

Pat Jagos, who owns and manages all 16 of the Fascinations stores — the 10 in Arizona, all of which are in the Greater Phoenix area, and the six in Colorado — says that while there have been fewer transactions overall since the recession hit, the ones they are getting are higher in value. “People who still have jobs and money are perfectly okay with going out and shopping, and they are pleased to find a quality product,” he says, adding that, in response, he has added more higher-quality items to his inventory. Jagos, too, is hearing from his staff that many customers are saying that even if money is a bit tight, they are finding room in the budget to treat themselves now and then.

Jagos says he is constantly challenged to find ways to bring new shoppers in to his store.

“We have a perception to overcome, and that is that some people think of Fascinations as a naughty place,” he admits. “But we’re not selling DVDs or anything like that, and lately we have been selling more apparel, lingerie and shoes than ever.”

The best locations, Jagos shares, are the free-standing stores as opposed to the ones located in strip malls or larger shopping centers. He attributes this to Fascinations being a “destination business” rather than one that customers will decide to go to on the spur of the moment after doing business in other shops.

For Bridgette McDonald, owner of Roka Boutique in Glendale, reaching out to the community and finding ways to give back have helped get the word out about her store, which inbusine ssmag.com

carries a variety of products, including jewelry, clothing and handbags. “We have sponsored food drives, school supply drives and other events,” she says. McDonald, who opened her boutique in 2006, has also adjusted her inventory a bit, eliminating some of the “higher higher-end items” for some lower-priced ones while not sacrificing quality. “For us, sales have been really good. We have a loyal group of clients, and we are getting new customers on a weekly basis. Word-of-mouth has really helped.”

For some retailers, expanding their offerings appears to be a prevalent trend and a way to try to increase revenue by keeping customers in the store longer, says John P. Eaton, Ph.D., clinical professor in marketing at Arizona State University’s W. P. Carey School of Business.

“We’ve seen discount stores like Walmart and Target add entire grocery sections to their stores in order to acquire a larger share of the consumer’s wallet,” he says, adding that retailers may also be diversifying their product lines in an attempt to identify potentially higher-margin products.

Barnes & Noble adding a toy section illustrates what Eaton calls a “contrast effect.”

Since toys in a book store tend to stand out, he explains, they may generate more interest than a few more aisles of books. “Perhaps Barnes & Noble knows that a percentage of customers shop with their children. Having a toy section may allow parents to spend more time looking at books while the children are entertained with toys,” says Eaton, observing, “Nothing detracts from the book-shopping experience like a dissatisfied child.”

Ahlmer, although describing the market as uneasy, says, “Overall, our sales are up. It’s not going gangbusters, but we are ahead of last year.” A recently completed report on August 2011 shows sales up that month by 8.4 percent over August 2010. For the December holidays, a 3-percent increase has been predicted nationally, but Ahlmer expects Arizona to come out ahead of that. “We have the advantage of having winter visitors here, which bumps up our numbers a bit,” she says.

20 Lounge — Nail Bar and Boutique 20lounge.com Arizona Retailers Association azretailers.com Fascinations fascinations.net Premier Lighting shoppremier.com Roka Boutique shoproka.com Vestar vestar.com

Foot Traffic

Traffic data is more useful than money in the till as an analytic tool For many retailers, success is defined by how much money is in the till at the end of the day. Mark Ryski, founder and CEO of Edmonton-based HeadCount Corporation, a global market leader in retail analytics, thinks retailers need to change their way of thinking.

Ryski, a 17-year veteran of the retail industry and author of Conversion: The Last Great Retail Metric, contends the focus should be on how much traffic a store gets and how many of those people coming in are actually buying anything. Using the science of traffic and conversion analytics, retailers can get a more accurate view of their success — and if the conversion numbers are low, they can focus on what they need to do to improve them.

“The irony is, traffic and conversion ideas have been around in retail for decades,” he says. “But there is renewed interest in the topic and it’s coming back into fashion in a big way.”

An electronic traffic counter device enables store owners to get a good reading of how many people come into their store on a given day, he explains, adding that many shop owners have no idea how busy their shops truly are because they are focusing on the money rather than the masses. If owners realize that a low percentage of people who enter the store actually make a purchase, they need to take a hard look at why this is the case and then “manipulate the variables” to try to improve the number of sales, says Ryski.

Ryski suggests one way to start is for the owner to sit near the entrance and causally assess the situation. “Maybe the retailer doesn’t have enough staff, or maybe not the right staff. Maybe they are working plenty of hours but they are not well-trained,” he says. Inventory problems may be the culprit, as perhaps the item has been advertised on sale but there is not enough stock on hand, or there is a long line at the checkout counter and people don’t want to wait.

W. P. Carey School of Business wpcarey.asu.edu Zia Record Exchange ziarecords.com

HeadCount Corp. headcount.com

J a n u a r y 2012

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inbusine ssmag.com

Industries

Leading

Our Way Key sectors promise strength for Arizona’s economic future

by RaeAnne Marsh

rizona’s founding economy rested on the five “C’s”: copper, cattle, cotton, citrus and climate. Another “C” — construction — was a major economic driver until the recent housing meltdown. The industries that will support a thriving Arizona into the future give us a broader alphabet and promise the strength of diversity. “Our effort with the Arizona Commerce Authority is to transition Arizona to an economy diversified beyond real estate and construction into core industries found within [the targeted and sometimes overlapping sectors of] science and technology, aerospace and defense, renewable energies, and small business and entrepreneurship,” says Sandra Watson, executive vice president and chief operating officer of Arizona Commerce Authority. inbusine ssmag.com

J a n u a r y 2012

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Focusing on sectors rather than individual industries helps build the synergy of competitive and complementary businesses that yields spin-offs and more business. The concept of targeted sectors has evolved from economist Michael Porter’s theory of economic clusters, adopted

by Arizona in the early 1990s. “We were the first state to adopt that principle,” says Ioanna Morfessis, Ph.D., who was the first president and chief executive officer of Greater Phoenix Economic Council and now works with leaders and organizations worldwide through her economic development consulting firm IO.INC. At that time, she recalls, Arizona was considered a third-tier economy, a low-cost alternative that could serve businesses in California. The Phoenix Blueprint for Growth, which she worked on with then-mayor Terry Goddard and many corporate executives, aimed to position Phoenix as an emerging business center in the Southwest. Efforts included “growing our own, because that’s where most job growth comes from” and building a financial services center as a basis to begin attracting corporate headquarters, she says. “As the economy worsened, the effort that began in Phoenix morphed into a regional effort.”

Watson notes that Arizona has lost about 300,000 jobs in the recession, and projections for job creation predict an imbalance of jobs for the next seven years — with “an inordinately high number of lowpaying jobs requiring only minimal education.” These, she notes, are the types of positions most susceptible to economic downturns.

Instead, Arizona Commerce Authority — along with more localized entities such as Greater Phoenix Economic Council — is focused on growing those business sectors that will create more high-wage jobs.

Observing that Arizona’s economic development strategy has relied for decades on quality-of-life advantages, sunshine, good transportation, an affordable work force and pro-business governments, Watson notes these factors primarily facilitate the expansion of lower-value-added industries such as tourism, retirement and other labor-intensive operations like call centers and customer service. While still valuable to the economy, construction, tourism and the financial sectors benefit from the high-quality jobs that result from growth in the targeted base industries. The more high-wage jobs, the more households with expendable incomes necessary to keep small businesses going and the more growth of jobs in the service areas, Watson explains. “It is this holistic approach that will strengthen the state economy for the future, while creating and retaining significant jobs and industry in the state,” she says. “The goal is to develop and build Arizona’s economic foundations and diversify the industry base.”

Arizona faces stiff competition for businesses and jobs, Morfessis notes, as other states implement aggressive incentive packages and fewer and fewer new jobs are created here than overseas. So, in addition to keeping what we already have, it’s important to be “finely focused on where we can make the greatest business case for doing business here, where those jobs and those companies will also bring tremendous value,” she says.

Morfessis sees the most important sectors now, from the standpoint of the global economy to our economy here at home, are with companies that employ professional and technical jobs: business, professional and financial services, and research and development; bio-

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and life sciences, including health care and next-generation medicine; and higher education. Pointing out that in Phoenix, alone, there are more than 60 colleges and universities and more than 130,000 people in classrooms — a number that does not include those studying online — as more and more people are seeking academic degrees, Morfessis emphasizes, “It’s important to create the kind of jobs that will enable us to keep and grow our intellectual capital.”

Aerospace and Defense

“Arizona enjoyed significant aerospace and defense industry for many years,” says Vicki Panhuise, Ph.D., chairman of the Arizona Aerospace and Defense Commission, president and owner of VePoint Consulting Group, L.L.C. and guest editor of this issue of In Business Magazine.

Just how significant is shown in the recently completed economic impact study on the industry in 2009 that she cites: Collectively, the major firms — such as Boeing, Raytheon, Orbital and Honeywell — employ more than 36,000 and have a payroll of $3.9 billion. The average compensation package of these employees is $109,000. “That means this is a creative type of business for the state,” she says, noting the compensation is 2.3 times that of the average Arizona worker.

Adding to such direct employment the number indirectly employed, such as at the 17 military installations throughout the state — Department of Defense employees as well as contractors, including security and facility maintenance — and at the airports — airline agents, ground maintenance, pilots, airline attendants, airport administration — the industry currently produces nearly 94,000 jobs and a gross state product of $8.8 billion. A report in May from the Council for Community inbusine ssmag.com

and Economic Research projects defense contracts will bring 3,000 to 6,000 new jobs by 2015, and Panhuise notes that this is without any major economic development activity. She also cites a national STEM (science, technology, engineering and mathematics) report that just came out projecting that Arizona will demand a total of more than 153,000 STEM jobs by 2018, up from 132,000 in 2008, and points out aerospace and defense is one of the areas that heavily employs STEM workers.

A significant growth area for the military and the Department of Homeland Security is unmanned aerial systems that can take over security missions. So far, all testing and certification has been done on military bases, but a bill is now being considered by the Federal Aviation Administration to select four commercial test sites, says Panhuise. “Arizona has a large advisory committee working to have Arizona be one of those test sites.” This is not just about the vehicle, she notes, but also the payload: “What kind of cameras, what kind of sensors, what kind of other things can the unmanned system carry to help do the mission.” This involves smaller companies as well as giants like Boeing, pulling in manufacturers, software engineers and other capabilities yet to be invented.

Admitting the budget discussions in Washington, D.C., present some risk to the industry, Panhuise says Arizona is taking a proactive approach in efforts to be partners with the Department of Defense. “One of the things the ACA is making sure they have on board is someone as an advisor who … can walk into the Pentagon, and understand the implications and what’s important to Arizona.”

While there is no single state-wide organization for the industry, Panhuise says, “We’re working on concepts to put one in place.” In the meantime, there does exist a variety of organizations that address the technology, which includes Arizona Technology Council, Science Foundation Arizona and different professional societies. And a first-of-its-kind conference is being planned for January, in Phoenix, to bring together large aerospace and defense industry companies with smaller businesses “to allow matchmaking,” says Panhuise.

“We’re hoping it will set the tone for aerospace and defense, and get us more recognized by everybody.”

percent of Arizona’s exports just between the 33 percent from semiconductors and electronics and the 18 percent from aviation.

And these are the highest-quality jobs and pay, Zylstra notes, citing Intel as example: The average compensation package among all of the 10,000 employees at Intel’s Chandler plant is $122,000.

Among Arizona’s current strengths is information technology, according to Zylstra, with IT companies making up nearly one-third of the Arizona Technology Council membership. Data centers, in particular, are drawn to Arizona because the area is unlikely to suffer natural disasters such as hurricanes and earthquakes that could disrupt service. “It gives people a feeling of security when they’re storing their most valuable information,” Zylstra says. He also names telecom and optics — the latter dominated by Tucson as a result of the University of Arizona’s astronomy program — as current strengths.

Emerging sectors of renewable energy and bioscience bode well for Arizona’s economy. Zylstra points out that Power One, which manufactures the electrical-current inverters needed to use the solarand wind-produced energy, predicted it would be hiring for 100 jobs but has grown to 250 in its first year. Minnesota-based Medtronic, a global leader in medical technology, has a location in Tempe because of the semi-conductor content in its implantable devices such as Pacemakers. “The medical-devices field creates a lot of jobs because they’re manufactured products,” Zylstra notes.

Other major players in the biosciences include Sanofi-aventis, Roche and Abraxis. This complements the existing clinical capability Arizona offers with Mayo Clinic and St. Joseph’s Hospital and the academic research that goes on at the universities, says Zylstra.

“Businesses invest in technology to help them achieve greater efficiency and boost employee productivity,” says Phil Gallagher, president of Avnet Technology Solutions, Global. “If we provide the

Science and Technology

Steven Zylstra, president and chief executive officer of Arizona Technology Council, makes a strong case to back up his statement, “The future economy is dependent on the continued growth of the technology industry.” Technology tends to be creative, he says; new ideas lead to new products that lead to new commerce and then to exports, which brings wealth back into the state. The industry today accounts for more than 50 inbusine ssmag.com

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right technology solutions that create cost savings for companies, they will move forward with those investments, even in a global market facing economic challenges.”

Zylstra points out that manufacturing is a big part of the technology sector and, while there is a lot of automation, there is also a labor content. High-level labor. “Technology is dependent on having a first-class higher education system. That’s where much of the talent comes from. These high-tech companies demand higher levels of education than traditional industries.” Arizona does have that education system, Zylstra says, naming Arizona State University, University of Arizona and Northern Arizona University, but, as Morfessis emphasizes, there also must be job opportunities to keep that talent here.

Base industries in the key sectors have an enormous multiplier effect, adding three to five jobs in businesses such as dry cleaning, donut shops and car washes, and “technology has the highest multiplier effect,” Zylstra states. Plus, there is the impact of critical mass in specific areas.

Explains Zylstra, “When you get a critical mass, you attract suppliers to feed the plants. You grow clusters [as businesses] locate close to the operations they support.”

— solar in particular. “Sun is more efficient and affordable [here] than it is in most places,” Broome says, reiterating his stance that, because of our wide-open spaces and desert environment, Arizona is wellpositioned to build large-scale concentrated solar power installations.

Not only for use within the state, but “with some policy changes, we have the ability to export energy around the world from Arizona.”

The current power infrastructure is falling well-behind in its ability to meet energy needs, according to Broome, and in the next 10-15 years, $300 billion-worth of obsolete coal-powered generation will need to be replaced nationwide. “I don’t see that being replaced with another carbon-burning energy source like coal,” he says.

“So all these major top-line trends point to the fact that this is going to be an important technology — and Arizona meets the needs of the sector pretty well from the talent and sun standpoint.” In fact, due in no small part to GPEC, the greater Phoenix area has welcomed many new solar-related businesses over the last couple of years.

Several large solar-generating installations are on-line now statewide, with $9 billion in projects currently or projected to be under construction. To service them, a supply chain is occurring in the market, adding businesses such as the Rioglass Solar manufacturing plant that opened in Surprise this year predominantly supplying materials to the new Abengoa Solar plant. Work is also going on to develop advances in the areas of transmission efficiency and storage.

Broome anticipates Tempe-based First Solar, already established as a global leader in the manufacture of photovoltaic modules, will become a developer of solar in addition to supplying materials. And Arizona State University, he says, “is doing unbelievable work around solar.”

Observing, “Expertise is built around the product,” Broome names Clear Energy and First Solar as among the companies that will become the sought-out experts to other regions, including countries like China. Furthermore, as talent around the infrastructure starts to occur, says Broome, “People will come to Arizona to learn how to solarize their state and their community.”

Small Business and Entrepreneurship

Renewable Energy

“There’s unprecedented investment of public and private dollars being invested in solar and other renewable energy,” says Greater Phoenix Economic Council President Barry Broome, expressing the view of GPEC that, domestically and globally, there will be an energy revolution in the next 10 years away from a carbon-based energy position.

And he maintains Arizona will be a major player in renewable energy

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Small business and entrepreneurship may well encompass the largest sector to which Arizona Commerce Commission is focusing its efforts and resources. The latest figures, according to Arizona Small Business Association Chief Executive Officer Donna Davis, estimate Arizona is home to 488,456 firms of fewer than 500 employees. (Putting that into perspective, there are approximately 3,000 large companies operating in Arizona.) These small businesses run the gamut of industries, she says, “from high-tech to agriculture to manufacturing to services, and everything in-between.”

Small businesses’ biggest concern in the present economy is anemic sales due to weak demand for products and services, followed closely by uncertainty about the regulation and tax requirements by which to operate, as federal, state and local governments are unable to settle on inbusine ssmag.com

policy. “I don’t create jobs based on tax cuts; I do jobs based on sales or product services,” says Paul Smiley, president of IT consulting company Sonoran Technology and Professional Services. Additionally, Davis says, “Skyrocketing costs for health care and unemployment also keep small business owners up at night. So does restricted access to capital, especially working and venture capital.” But because so much of the United States economy is driven by consumer spending (78 percent), Davis sees tremendous potential for growth of businesses of all sizes as the economic situation improves.

Andrew Hann, who has owned Fountain Hills Door & Supply since 1999, sees the greatest potential in retail and health care. “We’ve always been high on retirement,” he says. “So there will be a rapid job market regarding health care and the elderly.” His business sector, construction supply, is “dead in the water,” but he believes it’s a temporary hiatus as there is potential for a “fairly large exodus from the rest of the country down to the warmer climates.” In a previous job, he traveled throughout the United States, and he relates, “One reason I bought a business in Arizona is everybody told me they want to come down here at some point in their life.”

“Small businesses can also benefit by providing specific expertise, faster turnaround times, greater efficiencies and fresh approaches to bigger firms,” says Davis. A recent survey found nearly three-quarters of small-business owners expect their prospects to be better a year from now, she says, pointing out such a finding is reflective of the optimistic

entrepreneurial spirit behind most small companies.

“The heaviest concentration of small businesses is among sole-owner operators, but the greatest potential is probably among the 100,000 or so small firms that have employees,” says Davis. “As the economy improves, many of these firms will be in a position to add workers and scale up.”

The growth in numbers of sole-owner businesses she attributes to efforts by laid-off employees seeking to re-invent themselves as consultants and “one-man band” entrepreneurs.

Crediting ASBA as “one of the engines to create business in Arizona,” Smiley, who co-founded his company with Peter Ehrenfeld in 2007, says there is potential for growth but “we have to go outside what we’ve done in the last 20 years.” Noting that Goodyear, where his business is located, is now home to companies from China, France and Germany, he says the city works hard to brand itself as the ideal place for business and that such marketing is what the state needs as well. But also key is human capital. “What makes me a good company is the quality of the talent I have [available] to hire.”

Stating, “The development of Arizona-based companies and support for its entrepreneurs and innovators is critical,” Watson enumerates several new initiates the ACA is launching to foster growth in this sector. To support early-stage ventures and advance the commercialization of technology, the ACA is following up its business challenge of 2011 — the nation’s largest, according to Watson — with a second $1.5-million Arizona Innovation Challenge in 2012. For the specific purpose of helping Arizona companies export their products, the ACA secured $656,000 from the U.S. Small Business Administration. The ACA-staffed Innovation and Entrepreneur Center, located in Downtown Phoenix at 1st Street and Van Buren and nearly ready for its Grand Opening in early 2012, will provide what Watson describes as “a place to think, to create and to make business dreams reality through a host of business development resources.”

And 2012 will see the ACA launch an $18.2-million Arizona Innovation Accelerator Fund Program to stimulate financing to small businesses and manufacturers. The ACA secured the initial funding through the State Small Business Credit Initiative of the U.S. Department of Treasury. The program, a collaboration with lending institutions and private finance partners, will “foster business expansion, capital investment and job creation in Arizona,” says Watson.

Arizona Aerospace and Defense Commission azaerospace.com Arizona Commerce Authority azcommerce.com Arizona Small Business Association asba.com Arizona Technology Council aztechcouncil.org Avnet Technology Solutions avnet.com Fountain Hills Door & Supply fhillsdoor.com Greater Phoenix Economic Council gpec.org IO.INC. ioworldwide.com Sonoran Technology and Professional Services sonorantechnology.com VePoint Consulting Group, L.L.C. vepointconsulting.com

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The Path of Arizona’s Economic Heritage

by Brett Maxwell Anyone who went to grade school in Arizona remembers learning about the “five C’s.” But now, most people who live in Arizona cannot recite those five historical economic strongholds that helped mold this state to what it is now. Cattle, copper, citrus, cotton and climate are so important to the state’s heritage that each is represented on the state seal. Arizona’s economy has evolved since becoming a state in the early 20th century. Industries such as technology, science, renewable energy and health care offer Arizona more economic growth than mining and agriculture. Arizona has not completely abandoned its economic legacy, as the state is still at or near the top in the country in each of the five “C’s”, but the impact those five industries have on the state’s economy has changed.

Cattle

In 1918, Arizona harbored more than 1.75 million head of cattle. A year later in Phoenix, the “cattle baron” Edward A. Tovrea opened the Tovrea Stockyards, which held more than 300,000 head of cattle, making it the world’s largest feedlot at the time. Arizona’s prowess in cattle ranching has since dwindled, as the state now holds half the number of cattle it did in 1918. Arizona ranks 32nd in the country for head count of cattle, according to the 2010 figures from the U.S. Census Bureau. But that doesn’t mean the cattle industry has lost its importance to Arizona. “As population grows, you need more and more dairy products,” says Lee McPheters, Ph.D., research professor of economics in the W. P. Carey School of Business at Arizona State University. “[The cattle industry] is the number one agricultural revenue creator in Arizona.”

Cattle and calves are the most important agricultural commodities in Arizona, as beef production accounts for $4 billion of Arizona’s $10.2 billion agriculture industry. Wholesale beef prices are much higher this year than they were last year and beef retail prices continue to rise, says Arizona Cattle Growers Association President Andy Groseta. Drought conditions in recent years have led to declining cattle inventories, which in turn causes higher beef prices, Groseta notes. “[The cattle industry] is a very historic and basic industry and a very healthy industry in Arizona and a major economic driver,” he states.

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Copper

The Arizona Mining and Trading Company became the first mining company in Arizona in 1853 and helped establish the industry that has molded the state’s identity.

Ten years later, in 1863, Arizona’s territorial government was established and nearly half of the legislators elected were involved in the mining industry. About one of four people living in Arizona during the state’s territorial days worked as a prospector or miner. The present Arizona copper industry does not drive the state’s economy as it once did but still has a positive impact.

Arizona is the top copper state, producing roughly 60 percent of the entire country’s copper supply each year. In 2010, the copper industry had an economic impact of $12.1 billion and employed more than 10,000 Arizonans, according to the Arizona Geological Survey. McPheters says copper is still important to Arizona, but the employment numbers are small relative to the state’s overall economy.

“We’ve got 2.4 million workers in the state, so [the number of employees in copper mining is] a small percentage,” McPheters points out. “It’s not even one percent; it’s half of one percent.”

Citrus

The urbanization of the Phoenix area has hit the citrus industry hard.

Once the value of land began to rise in Arizona, it was more profitable to build subdivisions and highways on land once occupied by citrus groves.

The Mesa Citrus Growers Association, a business cooperative formed in

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the 1930s, closed down the Valley’s last citrus packing plant in 2010. The association had 162 members at the time of its inception. When the plant closed last year, the association had only 13 members. In the 1995-1996 growing season, the plant produced 1.4 million cartons of citrus under the Sunkist brand. The last growing season saw the plant produce only 200,000 cartons.

According to the USDA’s National Agricultural Statistics Service, citrus-producing land in Arizona has declined from 52,640 acres in the 1977-1978 growing season to 13,500 acres for the 2010-2011 growing season. However, Arizona is thriving in vegetable production. The Arizona Farm Bureau reports the state ranks second in the country in lettuce, cauliflower and broccoli production.

Cotton

The U.S. placed an embargo on goods from Egypt, the chief supplier of industrial-strength cotton, during World War I. Arizona began to produce cotton needed for products such as airplane wings and tires. The Goodyear Tire Company came to the Valley at this time and began producing cotton in the town now called Goodyear. With the introduction of automated pickers, cotton hit its peak in Arizona in 1953 when the state yielded 1,070,000 bales of cotton, a record that still stands today. Arizona produced 605,000 bales of cotton in 2010.

As residential and urban development made land profitable in Arizona, cotton acreage began to shrink. “Cotton [fields] had the water rights, and the water rights stay [with the land],” McPheters notes. The water rights made cotton fields desirable to developers of subdivisions and shopping centers. The industry has also suffered from a labor shortage as immigration issues continue to grow. The U.S. and Mexico had an agreement from 1947 to 1964 called the Bracero Program, which let Mexican migrants work during the harvest season. At its peak, the program employed nearly 445,000 in 1959.

Cotton yields and acreage grew significantly from 2009 to 2010 as a result of the plummeting housing market in the Phoenix area.

Land once set aside for housing development is again used for cotton production. From 2009 to 2010, cotton acreage increased 35 percent and cotton production increased 33 percent.

in the growing and booming tourism industry. “There is a great climate in every single section of Arizona at some point during the year,” says Sherry Henry, director of the Arizona Office of Tourism.

Travel has become a leader among the state’s export-oriented industries, beating out microelectronics and aerospace. Travel spending brought in $17.7 billion in 2010, an increase of 7.9 percent from 2009. However, the state’s tourism industry has not been immune to the recession. It generated roughly 152,200 jobs in 2010, which is a 2.5 percent decrease from the previous year. From 2008 to 2009, the state saw a decrease of 6.4 percent.

The “five C’s” were vital while Arizona carved its path to statehood in the early 20th century. While the economic impact of the industries that define Arizona’s heritage may not be the same in today’s servicebased and technology-based economy, the “five C’s” still serve important niches that are essential not only to the state but to the country. The “five C’s” built the foundation that Arizona’s economy rests on today. McPheters states that the “five C’s” do not make up a large percentage of Arizona’s modern economy but observes, “The ‘five C’s’, as originally set out, are still healthy in Arizona.”

Arizona Cattle Growers Association

azcattlemensassoc.org

Arizona Farm Bureau azfb.org Arizona Geological Survey azgs.az.gov Arizona Mining Association azcu.org Arizona Office of Tourism azot.gov Goodyear Tire Company goodyear.com National Agricultural Statistics Survey nass.usda.gov W. P. Carey School of Business wpcarey.asu.edu

Climate

Arizona’s climate produces more than 300 days of sunshine a year, making the state a bastion for all things that rely on the sun to thrive.

Because of Arizona’s climate, the state became a top producer in the U.S. of agricultural products. The state’s climate is now a major factor inbusine ssmag.com

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HR

People Are Key

Attract and Keep the Best and the Brightest Good healthcare benefits do both recruiting and retention

by Gremlyn Bradley-Waddell Deciding on what to offer employees in a healthcare benefits package can leave even the most competent entrepreneurial sort feeling out of sorts.

The number of insurance carriers, the array of plans and their associated price tags is downright dizzying. Add to that the ongoing lethargic economy and the recent news that employerprovided health insurance premiums have shot up about 9 percent this year — according to the annual Kaiser Family Foundation’s employer survey — and an employer’s generosity and energy may start to wane.

Business owners should stay strong, however, because a top-notch benefits package could be one of the most significant business decisions they’ll ever make. After all, many benefits are tax-deductible for entrepreneurs and their families. What’s more, they don’t just attract the best and the brightest, but also “keep those valued employees at your side,” notes Don Mollihan, C.F.P., C.E.B.S., managing partner at Arizona Benefit Consultants LLC, a Phoenix-based company that provides benefit solutions. “Benefits are a huge recruiting and retention issue,” Mollihan says.

Establish Wants, Budget Those just starting out in the business world as well as seasoned veterans will probably want some help when it comes to selecting benefits — particularly to hire the cream of the crop.

Business owners can build a package themselves, but Mollihan says most choose to work with a broker or consultant who knows what’s hot and what’s not in the world of benefits.

Assuming that most entrepreneurs really want only the best for their workers, the fact remains that everyone, even the big guys with deep pockets, has a budget. So Hank Mackey, R.H.U., R.E.B.C., owner and principal of H.A. Mackey & Associates in Phoenix, first has his clients decide what they want to offer in a plan and then, as someone who designs benefit

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programs, he works with them to determine what they can actually afford to offer.

That said, the industry in question also determines what the business owner will offer.

For example, what will job candidates who are vying for a job at an architecture firm do when they realize there’s only a bare-bones insurance policy on the table? “They’ll pass,” Mackey says.

But for the staff at a landscaping firm, which probably experiences considerable employee turnover and requires a markedly different skill set than what’s found at an architectural firm, a lean insurance policy may be entirely acceptable. Likewise, a no-frills policy may be the only option for a new owner whose

capital is tied up elsewhere. And some start-up companies, which may be struggling to make payroll, may forego a benefits program entirely.

The Core of the Matter In general, Mollihan says, a firm that wants to be competitive in the hiring marketplace should offer “core benefits,” which usually consist of a health plan offered either through a PPO (Preferred Provider Option) or HMO (Health Maintenance Organization), and may include dental, vision and long- or short-term disability coverage. Indeed, the most common benefits scenario is comprised of a PPOadministered group health plan as well as a group dental plan, adds Mackey. inbusine ssmag.com

Books Of course, even the best health plan in town won’t be appealing if the premiums are sky high. So keep in mind, he says, the four main factors that carriers look at when calculating their rates: age, gender, the health of the overall group and the physical location of the business. And don’t ever count on seeing rate decreases.

“Like a college education, every year [a benefits package] goes up in price,” Mackey says. “It doesn’t go down. Medical inflation is, basically, a constant.”

When contemplating what health plan to offer, business owners should think about current and future employees, at what stations they are in their lives and, of course, what they can afford. Learning more about the employees can also enable the employer to present other alternatives. For example, Mollihan says, a small business owner — primarily one whose staff is comprised of fairly healthy young adults — might opt for individual health insurance policies over a small group plan, which requires medical underwriting on each employee. With the individual policy approach, an employer pays the employee a specific amount each month, such as $300, and the employee uses that toward premiums on an individual healthcare plan that he has chosen and purchased on his own.

Either way, providing a health plan shows the work force that the employer cares about their well-being and is willing to invest in them. While that’s good for them, it’s also good for the employer because healthy workers who are getting preventive care and seeing a physician on an annual basis are, on the whole, more productive and less prone to illness and taking time off from work.

Limits and More Another factor that can tip a potential employee’s scale in favor of one employer over another is how much of the health-insurance deductible the employer is willing to pay. “Twenty years ago, companies would pay 100 percent,” Mackey says. “Now, they pay 80 percent or 75 percent. Carriers say you [the employer] have to pay at least 50 percent, but employees are shouldering a bit more of the cost.” For those who can afford it, paying 95 or even 100 percent of the deductible might be what makes an employer stand out to those employees whose skills he or she covets.

Employers can think about further sweetening the pot with ancillary benefits, the category into which life insurance, group dental, group vision and short- and long-term disability coverage can fall, Mackey says. And don’t forget about things like workers compensation or a retirement plan, such as a 401(k). These frequently sought-after programs call for guidance from a professional, such as an attorney, however, and may not be within all employers’ financial means.

Lastly, there are voluntary benefits, such as Aflac, which are supplemental insurance products that cover benefits that major medical insurance does not. Employers sponsor and deduct voluntary benefits from payroll but do not contribute toward them, and workers generally can purchase the programs through work at a better rate than they could obtain on their own.

For some employees, employer-provided health benefits could mean getting a great deal and, likewise, for some employers, it could mean getting an ideal employee.

Arizona Benefit Consultants, LLC abcllc.org H.A. Mackey & Associates hamackey.com

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Leadership

EntreLeadership: 20 Years of Practical Business Wisdom from the Trenches Your company is only as strong as your leaders.

These are the men and women doing battle daily beneath the banner that is your brand. Are they courageous or indecisive? Are they serving a motivated team or managing employees? Are they valued? Your team will never grow beyond you, so here’s another question to consider: Are you growing? Whether you’re sitting at the CEO’s desk, the middle manager’s cubicle or a card table in your living room-based startup, EntreLeadership provides the practical, step-by-step guidance to grow your business where you want it to go.

Dave Ramsey $26 • Howard Books • On shelves and online

Great by Choice: Uncertainty, Chaos, and Luck -Why Some Thrive Despite Them All Ten years after the worldwide bestseller Good to Great, Jim Collins returns with another groundbreaking work, this time to ask: Why do some companies thrive in uncertainty, even chaos, and others do not? The book is based on nine years of research, buttressed by rigorous analysis and infused with engaging stories, and Collins and his colleague, Morten Hansen, enumerate the principles for building a truly great enterprise in unpredictable, tumultuous and fast-moving times.

Jim Collins and Morten Hanson $29.99 • Harper Collins • On shelves and online

Back to Work: Why We Need Smart Government for a Strong Economy Former President Bill Clinton gives us his views on the challenges facing the United States today and why government matters. He explains how we got into the current economic crisis and offers specific recommendations on how we can put people back to work, increase bank lending and corporate investment, double our exports, restore our manufacturing base and create new businesses. He supports President Obama’s emphasis on green technology, saying that changing the way we produce and consume energy is the strategy most likely to spark a fast-growing economy while enhancing our national security.

Bill Clinton $23.95 • Knopf Doubleday • On shelves and online

The Steve Jobs Way: iLeadership for a New Generation The former senior vice president of Apple Computers and close colleague of Steve Jobs throughout his tenure, Jay Elliot takes readers on a remarkable tour through Jobs’ astonishing career.

From the inception of game-changing products like the Apple II and the Macintosh to his stunning fall from grace and on to his rebirth at the helm of Apple; his involvement with Pixar; and the development of the iPod, iPhone, iPad and much more, The Steve Jobs Way presents real-life examples of Jobs’ leadership challenges and triumphs, showing readers how to apply these principles to their own lives and careers.

Jay Elliot and William L. Simon $25.99 • Vanguard Press • On shelves and online

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Trickle Up

A View from the Top

John Cosgrove and Rick Johnson: Executive Advisory Support Executive Forums brings C-suite executives together to process issues and share ideas

by Sue Kern-Fleischer John Cosgrove and Rick Johnson will be the first to admit that starting and running a business is chaotic. The principals and owners of Phoenix-based Executive Forums have a combined 80 years of business management experience. Executive Forums is Cosgrove’s fourth start-up and Johnson’s third. The majority of Cosgrove’s experience is in small business, sprinkled with some large, while Johnson has a blend of large- and smallbusiness experience.

Both know the pressures of running a successful company — Cosgrove worked for 26 years as partner in a $20+ million business and Johnson worked as vice president of sales for Avaya, where he was responsible for more than $1 billion in annual sales.

Both also know that running a company presents a unique set of challenges for C-suite executives. “It’s very lonely at the top,” Cosgrove says. “If you’re the owner, who can you talk to?

Sometimes friends and associates can help, but who can you ask those really hard questions or share those deep dark secrets with? How do you identify and manage the risks?”

Managing risks can be tricky and the odds for success are not favorable. Eighty percent of businesses fail within the first five years,

John Cosgrove leading a Strategies for Success Retreat with one of the forums and their spouses

and 80 percent after that fail by the 10th year.

Recognizing that senior-level executives face these universal challenges, Cosgrove approached Johnson in 2004 with the idea of purchasing an Executive Forums franchise, a membership organization that focuses on the “Top Executive.” The two friends had worked well together previously, and, after examining the business model, they decided to move their families from Colorado to Phoenix to launch their new venture. Though Cosgrove

had considered launching Executive Forums in Texas and Florida, Arizona was an untapped market and Johnson had family in Phoenix.

“We both moved to Phoenix not knowing anyone. We started out with a five-year business plan and a commitment to each other to give it the ‘old college try’ to build four Forums and take two months off each year,” says Cosgrove.

“We accomplished our plan in two and a half years.” Not bad for an “old college try.”

Just how did the two partners build their

Trusted Advisors Help Top Execs

■■ Executive Forums is an international member organization that helps top executives ■■ ■■ ■■ 32

J a n u a r y 2012

Rick Johnson

Photos: Executive Forums

John Cosgrove

advance from where they are to where they want to be by leveraging best practices and tools from business thought leaders coupled with informed peer perspective.

Led by principals and owners John Cosgrove and Rick Johnson, the firm works exclusively with top executives from local companies primarily with $5 to $50 million in revenues and 20 to 200 employees (though some members have been as small as $1 million and others more than $1 billion).

The firm expanded its approach to include “Navigating to the Next Level,” a unique peer support program that ties together its members’ strategic plan, best practices, forum meetings and coaching to help members achieve and exceed their goals.

Since 2004, Executive Forums has worked with nearly 100 companies that generate annually nearly $2 billion in revenues and employ more than 13,000 people in the Phoenix metropolitan area.

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business so quickly? “We created an entire strategy to penetrate and leverage key business groups and build networks throughout the Valley to ultimately create an entirely referralbased business model,” Johnson says. They succeeded in doing that within 18 months.

Seven years later, they have earned a solid reputation for helping top executives advance to where they want to be both personally and professionally by leveraging best practices and tools from business and thought leaders.

CEOs and senior-level executives join the international Executive Forums organization comprised of other members like them, and Cosgrove and Johnson help bring together these successful executives in groups of 10 to 12 to process issues together. Each group, or “forum,” meets regularly, and members continue to participate as long as they are receiving value. All members complete a two-page strategic plan that is shared with the other members in their group. The objective is to help each other execute their plans. “They value unbiased and informed peer perspective to help them execute more effectively with appropriate accountability,” Cosgrove says.

Cosgrove and Johnson co-facilitate four forums. As demand increased, they brought on Paul Wright, Ed.D., to manage two forums, and Sandy Kolberg, Ph.D., to manage one. “We provide a safe environment to share ideas and seek advice. Everyone signs a non-compete and non-disclosure form and there are no agendas except to learn and help each other,” Johnson says.

Since 2004, Executive Forums has worked with nearly 100 companies that annually generate nearly $2 billion in revenues and employ more than 13,000 people in the Phoenix metropolitan area. Passionate about their work, Cosgrove and Johnson have earned a reputation for delivering results. “Our clients view us as their trusted advisors,” Cosgrove says. “They don’t just want new ideas, they want a track to run on — a way to execute and achieve their vision and dreams while reducing risks.”

In 2010, Cosgrove and Johnson’s firm became Executive Forums’ largest Business Partner internationally. Their firm has received more than 20 awards recognizing numerous performance goals. In addition, their firm has twice been selected as Executive Forum’s ‘Business Partner of the Year’ (in 2007 and 2010) — a rarity in their business.

Executive Forums executiveforums.com

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WHERE YOUR ORGANIZATION GETS NOTICED!

Bringing together nonprofits and the people who support them Call: 480.481.2002 / Email: Myra@Myragards.com Website: blacktie-arizona.com / Brochure: PromoteYourNonProfit.com

J a n u a r y 2012

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NonProfit

by Sue Kern-Fleischer

Investing in Community

Thunderbird Charities: Aiding the Community through the Phoenix Open The 77 years that The Thunderbirds have been hosting the Phoenix Open have seen many highs and lows, from Andrew Magee scoring the tournament’s first and only hole-in-one on a Par-4 at the 17th hole (1st round 2001) to the death of Robert W. Goldwater, affectionately known as the “Father of the Phoenix Open,” in 2006. Considered by many to be one of the finest golf events on the PGA tour, the Waste Management Phoenix Open is the largest-attended golf tournament in the world, attracting more than 500,000 fans in one week. Its economic impact on Scottsdale and Phoenix is more than $150 million each year.

More than 100 local charities also benefit annually, and this year’s “Big Chief,” Mike McQuaid, credits the community for helping The Thunderbirds raise more than $75 million since 1937. The tournament’s annual operating budget is $24-$28 million; expenses of $18-$22 million are partially offset by corporate sponsorships, ticket sales, vendors, sales from food and beverages, and special events during the week, and remaining funds are distributed to the charities. When Phoenix hosted the Super Bowl in 2008, the golf tournament’s attendance soared to a record 538,000 fans and The Thunderbirds dispersed $8 million that year to deserving charities.

Thunderbird Charities wmphoenixopen.com

■■ EVENT: Waste Management Phoenix Open, Jan. 30 – Feb. 5, 2012, at the Tournament Players Club in Scottsdale.

■■ Through the WM Phoenix Open, Thunderbird Charities raises ■■ ■■

money for nonprofit organizations, most of which provide programs that benefit youth. Recent beneficiaries include Homeward Bound, The First Tee, Arizona Special Olympics and the Junior Golf Association of Arizona.

Each fall and spring, 15 Thunderbird Charities board members review grant requests to decide which nonprofits will receive funds. The next deadline to submit an application is March 1, 2012.

The Thunderbirds is comprised of 55 active members and more than 250 LifeBird members, all of whom were invited to join the group based on their sincere interest in sports and dedication to community affairs.

Since 2004, hundreds of families dealing with childhood cancer have received financial, educational and psychosocial support from the Children’s Cancer Network. The nonprofit’s cofounder and executive director, Patti Luttrell, is a pediatric nurse who knows firsthand the overwhelming challenges that add to the stress of caring for a child with cancer. Her son, Jeff, is a six-time survivor. One night while

■■ “Holiday Surprises Program” – During the holidays, CCN will adopt 21 families dealing with childhood cancer and help fulfill their holiday wishes.

■■ SAVE THE DATE: 9th Annual Fashion Show, Auction and Luncheon at the Arizona Biltmore Resort and Spa on Sunday, March 4, 2012.

■■ CCN’s John W. Luttrell Scholarship Fund was established in 2005, receiving its initial funding from ■■ ■■

friends and family of John Luttrell, who passed away that year from brain cancer. This year, $12,750 in scholarship funds were granted, including scholarships for two mothers to go back to school.

CCN helps families whose children are being treated for cancer at Phoenix Children’s Hospital, Cardon Children’s Medical Center, St. Joseph’s Hospital and UMC in Tucson.

One of CCN’s main purposes is to let families know they are not alone. When a child is first diagnosed with cancer, families receive a backpack with educational information, a gas card and a cafeteria pass.

Jeff was receiving treatment at University of Arizona Medical Center in Tucson, a child with cancer in the next room passed away. The grief-stricken family did not have gas money to drive home to Phoenix. At the insistence of Patti’s teenage daughter, Jenny, Patti and her husband Steve started Children’s Cancer Network two years later.

Now, with nearly 100 volunteers, CCN is on track to deliver more than $100,000 in patient and family services to Arizona families this year. Eighty-nine cents of every dollar raised goes back to support the families. Social workers at local hospitals help disperse $25 gas and food cards to families in need. The all-volunteer organization raises funds through events, individual donations, corporate sponsorships and a workplace giving campaign through Community Health Charities.

Children’s Cancer Network childrenscancernetwork.org

In business to do good for the community, nonprofits enrich the lives of those who contribute as well as those who receive. In Business Magazine showcases two nonprofits in each issue, focusing on their business organization and spotlighting an upcoming fundraising event.

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Photos: The Thunderbirds (top), Children’s Cancer Network (bottom)

Children’s Cancer Network: A Helping Hand for Stricken Families

www.inbusinessmag.com

January 2012

O n t h e Ag e n D a

A listing of Greater Phoenix business organizations and their events. Visit www.inbusinessmag.com for an expanded monthly calendar of educational, networking and special business events.

WESTMARC

2012 West Valley State of the State Governor’s Luncheon

Photo: Salt River Fields at Talking Stick

Thurs., Jan. 12 — 11:30a – 1:00p WESTMARC (Western Maricopa Coalition) and the West Valley Chambers Alliance present this annual Governor’s Luncheon to provide an opportunity for local businesspeople to listen to Governor Jan Brewer’s plans for Arizona in 2012. Gov. Brewer will address the group to give her State of the State on economic issues and public policy. Her remarks will focus on the West Valley but will also address pertinent economic issues affecting Arizona in 2012.

WESTMARC was founded in 1990 to promote a positive image for Western Maricopa County and to advocate on its behalf. It is a broad-based coalition of the 15 communities in western Maricopa County representing 35 percent of the population of the county. The group was established to act as a unified voice and focal point for the region in matters of public policy. Its mission is to coordinate and facilitate the influence of Western Maricopa County on public policy issues. WESTMARC is primarily funded by its business and industry members. Other members include government, education, human services, arts and cultural organizations, chambers of commerce and community leaders.

The West Valley Chambers of Commerce Alliance was created in 2007 to provide coordination of shared programs and benefits to advance the common business interests of the Buckeye Valley, Glendale, Peoria, Southwest Valley, Surprise Regional and Wickenburg chambers of commerce.

The Alliance also serves as the public policy advocacy body on issues that impact the business and economic climate of the areas served by the participating chambers of commerce.

The West Valley includes the cities of Avondale, Buckeye, El Mirage, Gila Bend, Glendale, Goodyear, Litchfield Park, Peoria, West Phoenix, Sun City, Sun City West, Surprise, Tolleson, Wickenburg and Youngtown.

—Mike Hunter West Valley Chamber Alliance wvcca.com WESTMARC westmarc.org

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Salt River Fields at Talking Stick

Knock It Out of the Park: Multi-Chamber Mixer Wed., Jan. 11 — 5:30p – 7:30p Start off the New Year and build your business relationships at the MultiChamber Mixer. This special annual event is bigger than ever and includes the Greater Phoenix Chamber, Tempe Chamber, Scottsdale Chamber, Mesa Chamber and North Scottsdale Chamber.

All will be a part of this networking event, which will take place at the new Salt River Fields at Talking Stick baseball training center in Scottsdale.

Members and their guests will enjoy food from some of the Valley’s bestknown restaurants, drinks, live music and giveaways. Salt River Fields tours will be available throughout the event. Members are asked to bring plenty of business cards to pass around as networking and building business is certainly a great reason to attend.

Although none have been this large, each of these events has been a great opportunity for those thinking about joining one of these participating chambers of commerce to experience what each has to offer businesspeople of all kinds. Contact one of the participating chambers to ask about attending as a guest.

Free parking is available at the “home plate” and “desert” parking lots of Salt River Fields. Registration is required.

—Mike Hunter Greater Phoenix Chamber of Commerce phoenixchamber.com North Scottsdale Chamber of Commerce northscottsdalechamber.org Mesa Chamber of Commerce mesachamber.org Scottsdale Area Chamber of Commerce scottsdalechamber.com Tempe Chamber of Commerce tempechamber.org

Notable Dates This Month January 1 New Year’s Day January 16 Martin Luther King Jr. Day Agenda events are submitted by the organizations and are subject to change. Please check with the organization to ensure accuracy. See more events online at www.inbusinessmag.com.

J a n u a r y 2012

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O n t h e Ag e n d a AHWATUKEE FOOTHILLS CHAMBER OF COMMERCE Ahwatukee After 5 Evening Mixer Wed., Jan. 18 5:30p – 7:00p

Members: $5; guests: $15 Bar Fitness 4425 E. Agave Rd., Phoenix ahwatukeechamber.com

SCORE

Thurs., Jan. 26 9:00a – Noon

One-on-one business counseling.

Free Ahwatukee Foothills Chamber of Commerce 3840 E. Ray Rd., Phoenix ahwatukeechamber.com

ARIZONA CHAMBER OF COMMERCE & INDUSTRY 2012 Legislative Forecast Luncheon Fri., Jan. 6 Noon – 2:00p

Speakers: Senate President-elect Steve Pierce, Speaker of the House Andy Tobin, Senate Minority Leader David Schapira and House Minority Leader Chad Campbell. Welcome remarks delivered by Governor Jan Brewer.

Members: $65; non-members: $80 Hyatt Regency Phoenix 122 N. 2nd St., Phoenix azchamber.com

ARIZONA SMALL BUSINESS ASSOCIATION Annual Meeting, Volunteer Celebration + Expo Thurs., Jan. 12 8:00a – Noon

Join us as we celebrate another year and honor our outstanding members, volunteers and partners. Maximize your connections by participating in the power-packed Business Expo.

Breakfast ticket for members: $25; for non-members: $40 Sheraton Crescent Hotel 2620 W. Dunlap Ave., Phoenix asba.com

The Process of Business Development Tues., Jan. 24 8:00a – Noon

The business presentation will identify the specific business sectors (operations, management, pricing, planning, startup cost, marketing, technical writing and marketing) linked with a detailed implementation plan.

Members: $25; non-members: $40 ASBA’s Business Education Center 4600 E. Washington St., Phoenix asba.com

Mentor Match

Thurs., Jan. 26 8:30a – 10:00a

Business owners will find their “mentor match made in heaven.” ASBA has brought together several of the top mentoring programs available, providing an opportunity to hear an overview of each as well as a chance to meet one-on-one with those that are of particular interest.

Free; Members Only ASBA’s Business Education Center 4600 E. Washington St., Phoenix asba.com

Business Organization Workshop Thurs., Jan. 12 5:00p – 8:00p

This workshop creates an overview of the business idea, project overview or strategic objectives by formalizing the business format, allowing the business owner to develop control and compliance systems specific to all areas of business activity.

Members: $40; non-members: $50 ASBA’s Business Education Center 4600 E. Washington St., Phoenix asba.com

ARIZONA TECHNOLOGY COUNCIL Lunch and Learn: Everyone Communicates, Few Connect Tues., Jan. 10 11:30a – 1:00p

Learn the importance of connecting to be an effective leader though five key connecting principles. Presented by Leap Innovation.

Members: free; non-members: $15 Microsoft 60 E. Rio Salado Pkwy., Tempe aztechcouncil.org

Council Connect: Resolving Workplace Conflict Wed., Jan. 18 7:30a – 9:30a

J a n u a r y 2012

CENTRAL PHOENIX WOMEN Breakfast

Mon., Jan. 9 7:30a – 9:00a

Deborah Ostreicher, Deputy Aviation Director Phoenix Sky Harbor International Airport, will present the leadership topic. $75 The Ritz-Carlton 2401 E. Camelback Rd., Phoenix centralphoenixwomen.org

ECONOMIC CLUB OF PHOENIX January 2012 Luncheon Wed., Jan. 11 11:30a – 1:30p

Featured: Hamish Brewer, president and CEO of JDA Software.

Members: fee varies with membership; non-members: $75; advance registration is required.

The Westin Kierland Resort & Spa 6902 E. Greenway Pkwy., Scottsdale econclubphx.org

GREATER PHOENIX BLACK CHAMBER OF COMMERCE SBA Loan Clinic Fri., Jan. 6 9:00a – 11:00a

Learn about Small Business Administration loans and how to qualify.

Free Score 2828 N. Central Ave.,Phoenix phoenixblackchamber.com

GREATER PHOENIX CHAMBER OF COMMERCE 2012 Governor’s Reception and Legislative Kick-Off

Learn to manage the conflicts that can undermine efforts of even the most well-intentioned team. Presented by Dale Carnegie Training. Breakfast will be provided.

Members, $15; non-members: $25 ASU SkySong 1475 N. Scottsdale Rd., Scottsdale aztechcouncil.org

Thurs., Jan. 19 5:30p – 7:30p

ASSOCIATION FOR CORPORATE GROWTH

Tues., Jan. 17 11:30a – 1:00p

2012 January Breakfast Tues., Jan. 10 7:00a – 9:00a

Featuring Robert Meyer, President and CEO of Phoenix Children’s Hospital.

Members & sponsors: $59; non-members: $79 Arizona Biltmore Resort & Spa 2400 E. Missouri Ave., Phoenix acg.org

Please confirm, as dates & times are subject to change.

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January 2012

Celebrate the second Regular Session of the 50th Legislature.

Free; members or by invitation only Phoenix Art Museum 1625 N. Central Ave., Phoenix phoenixchamber.com

Chamber Institute: The Art of WOW Join us for the January Chamber Institute and learn the “art of WOW” and how to create clients for life!

Free Greater Phoenix Chamber of Commerce 201 N. Central Ave, Phoenix phoenixchamber.com

MESA CHAMBER OF COMMERCE Salt River Fields Multi-Chamber Event Wed., Jan. 11 5:30p – 7:30p

Food and beverage, networking, facility tours, live music, vendor booths, giveaways and more!

Free Salt River Fields at Talking Stick 7555 N. Pima Rd., Scottsdale mesachamber.org

NATIONAL ASSOCIATION OF WOMEN BUSINESS OWNERS January 2012 NAWBO University Wed., Jan. 11 9:30a – 11:00a

Learn the 3 steps of the Law of Automation that will set your business up for success and significant growth while you focus on parts of the business you enjoy most. Presented by Piyush Parikh, president of Engineer Your Business.

Members: free; non-members: $30 Phoenix Country Club 2901 N. 7th St., Phoenix nawbophx.org

NORTH SCOTTSDALE CHAMBER OF COMMERCE Shea Character Area Plan — Business Forum Wed., Jan. 19 7:30a – 9:30a

Business, business property owners — you are invited to a forum to discuss your vision, opportunities and challenges for the Shea Character Area.

Free Boys and Girls Club 10515 E. Lakeview Dr., Scottsdale northscottsdalechamber.org

St. Mary’s Citrus Gleaning Sat., Jan. 29 10:00a – 2:00p

Join us as we glean grapefruit trees to benefit St. Mary’s Food Bank. All ages welcome, so bring the family.

Free 64th St. and Camelback Rd. northscottsdalechamber.org

PEORIA CHAMBER OF COMMERCE Ribbon Cutting — Bookkeeper Gail Tues., Jan. 31 8:00p – 9:00p

Free Bookkeeper Gail 8631 W. Union Hills Dr., Peoria peoriachamber.com

SCOTTSDALE AREA CHAMBER OF COMMERCE Ribbon Cutting — Lux Office Wed., Jan. 25 5:00p – 5:30p

Free Lux Offices 5635 N. Scottsdale Rd., Scottsdale scottsdalechamber.com

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E-mail and Social Media Marketing Strategies Tues., Jan. 31 8:30a – 10:00a

This seminar will educate marketing decision-makers on how they need to use both e-mail and social media as part of a well-rounded digital marketing strategy. $10 W. P. Carey School of Business, North Scottsdale MBA 8355 E. Hartford, Scottsdale scottsdalechamber.com

SOUTHWEST VALLEY CHAMBER OF COMMERCE City Market

Sat., Jan. 7 9:00a – 1:00p

Enjoy an outdoor stroll as you shop for produce, specialty foods, unique gifts, crafts, pet novelties and works by local artists.

Free Goodyear Ballpark 1933 S. Ballpark Blvd., Goodyear southwestvalleychamber.org

Goodyear Fair

Sun., Jan. 22 10:00a – 5:00p

Carnival rides, games, fun, food and festival activities, including some onstage entertainment.

Adults: $5; Kids 3-17: $2; Kids 2 and under: free Goodyear Ballpark 1933 S. Ballpark Blvd., Goodyear southwestvalleychamber.org

SURPRISE REGIONAL CHAMBER OF COMMERCE January Networking Breakfast/ Annual Meeting Tues., Jan. 10 7:00a – 9:00a

The 2012 board of directors will be presented to the membership, along with a review of our activities in 2011 and plans for 2012.

Members: $20; non-members: $25 The Colonnade 19116 Colonnade Way, Surprise surpriseregionalchamber.com

TEMPE CHAMBER OF COMMERCE Business After Hours: Joint mixer with ASU Wed., Jan. 25 5:30p – 7:00p

The Tempe Chamber and ASU Alumni Association are teaming up to kick off the new year with an energetic and fun evening mixer. Alumni and members of the business community get together for a casual night of food, drinks,

conversation and network development during this expanded joint mixer.

Members: free; general public: $10 Canteen Modern Tequila Bar 640 S. Mill Ave., Tempe tempechamber.org

Leadership Speaker Series: “Oceans of Possibility” Fri., Jan. 20 8:00a – 9:30a

Part one of a powerful four-part speaker series that will guide participants on becoming leaders through positive transformation at work and at home.

Speaker: Jan Whalen.

Members: $20; non-members: $30 Four Points by Sheraton 1333 S. Rural Rd., Tempe tempechamber.org

Leadership Speaker Series: “Living With Peace, Joy and Gratitude” Fri., Jan. 27 8:00a – 9:30a

Part two of a powerful four-part speaker series that will guide participants on becoming leaders through positive transformation at work and at home.

Speaker: Denise Alley.

Members: $20; non-members: $30 Four Points by Sheraton 1333 S. Rural Rd., Tempe tempechamber.org

WEST VALLEY WOMEN Meet the New Director and Ambassadors Tues., Jan. 10 11:30a – 1:00p

$35 SKYE 16844 Arrowhead Fountain Center Dr., Peoria westvalleywomen.org

WESTMARC West Valley 2012 State of the State Luncheon Thurs., Jan. 12 11:30a – 1:00p

Gov. Jan Brewer will be the featured speaker.

Members: $60; non-members: $75 Glendale Civic Center 5750 W. Glenn Dr., Glendale westmarc.org

WOMEN OF SCOTTSDALE Meet the New Director and Advisors Fri., Jan. 20 11:30a – 1:00p

$35 The Westin Kierland Resort and Spa 6902 E. Greenway Pkwy., Scottsdale womenofscottsdale.org

Please confirm, as dates & times are subject to change.

2012 ASBA

ANNUAL MEETING Volunteer Celebration + Expo

Thursday, January 12 | 8am – 12pm Sheraton Crescent Hotel | 2620 West Dunlap Avenue, Phoenix

Kick start your new year with a bang!

Celebrate accomplishments; meet outstanding members, volunteers and partners; and generate new sales – all in one exciting morning.

Booths available starting at only $100!

Get yours today; our last expo sold out quickly.

Register today at asba.com or call 602.306.4000.

ASBA Members: $25 | Non-Members: $40

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J a n u a r y 2012

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Education

Series on Branding

Great Brands Don’t Start with Art

by Kathy Heasley

Image is everything. Or is it? It is clear we live in a visual world and we are bombarded tens of thousands of times daily with visual cues. We take them in, we block them out, we assess, we judge and we decide in a split second. In this article, we’ll take you through the third stage of the branding education series — Image — and show you how to make sure the visuals that surround your brand are working as hard or harder than you are.

One of the biggest mistakes people make is creating a logo without first doing the heart work, which is stage one in our process, and translating the heart into messaging, which is stage two. This expensive error comes from the mistaken notion that a brand is a logo. A brand is not a logo; a logo is a representation of your brand, which we define as the promise and the experience.

One company we worked with years ago actually spent the better part of a year with a branding expert who was, in truth, a graphic designer. He was developing their brand, but really he was doing nothing more than designing the imagery for the company. That included a new logo, color palette, photography, website, business cards — everything. The marketing VP ordered revision after revision, often making dozens of small changes then abandoning the direction entirely and going in a new direction, then another, then back again to the first one in an effort to land on the perfect look. He’s lucky the graphic designer didn’t strangle him.

When they finally arrived at a concept after wasting not just a lot of time but almost $100,000 in fees, it was a sensual, pretty design

that never fully connected with their friendly and fun brand experience. So, to convince the company and maybe himself, the marketing VP arranged a workshop bringing everyone together to “define the brand.” As is typical with these sessions, most of the morning was spent with the facilitator warming up the group, trying to define a brand and extolling the process we’d be going through. Then it was time for a bathroom break.

When we returned, we were asked to select the celebrity, car, watch and animal that best represented the brand. Then we were asked to put key words on index cards and decide which ones represented the brand. This kind of stuff went on the rest of the day. People who voiced divergent opinions were taken aside and talked to — I was one of them. In the end, the facilitator had steered the group to the desired conclusion and the marketing VP and the designer proudly unveiled the designs. Tens of thousands of dollars more were spent on an off-site meeting to wrongly justify the wrong design direction.

This is the absolute opposite way to develop a brand image. Instead, the company’s heart should have been put into words, and those words into images. This company did it backward. They shot and produced their movie, then wrote the screenplay after the fact. Heart was there, but it was the heart of the designer and the marketing VP and that’s not nearly enough. What about the heart of the customer? The employees? This is just one example, but it happens all the time.

Another problem is brand images that undersell the company. One tech company owner we worked with was so married to the

Heart & Mind Branding — the Education Series The “Heart & Mind Branding” series takes business owners through the steps to consciously address improvements to their company’s success by implementing an integrated approach to branding. In Business Magazine presents the six-part series:

company’s original look — logo, website, etc., which he had designed — that he couldn’t see the need to change it. Rebranding, he felt, was unnecessary, but he still couldn’t understand why the million-dollar contracts were going to his competitors and his company wasn’t being considered. As a last-ditch effort, I brought in his competitors’ business cards and spread them out on the table along with his own card.

I asked, “Who would you give the milliondollar job to?”

He looked at me. “Son of a b----! Not this one,” he said, shoving his own business card forward. Case closed.

In our world, image is everything because we buy with our hearts and justify with our minds.

Images generate emotional responses in us. We make lasting judgments based on them. Look at your own materials, yourself, the people who represent your brand. This is your image.

Is it genuine, meaningful and different? Is it helping you or hurting you? Is it the brand you want to be, the brand you know you can be?

Is it driving bottom-line results? Great brand images do. But recognize this: They don’t start with art; they start with heart.

Heasley & Partners, Inc. heasleyandpartners.com

Kathy Heasley is founder and principal of

Intro

Heart

Message

Image

Actions

Systems

HEASLEY&PARTNERS, Inc., a branding company that helps organizations grow and prosper. She’s the creator of Heart & Mind® Branding, a Rich Dad Advisor, author of multiple books and CDs, and

To reference published segments, please access the archived “Education” articles on the In Business Magazine website, www.inbusinessmag.com.

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J a n u a r y 2012

international marketing and communications coach.

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connect + grow We exist to help science and technology companies of all sizes and stages succeed. By serving as the principal point of connection, the Arizona Technology Council can help you build global partnerships to grow locally, get your innovations noticed and stay ahead of the curve.

take a fresh look Whether you’re a part of a startup, emerging or well-established company in Arizona, we offer resources designed for you to gain insight, education, and connections.

In addition to our networking opportunities, public policy support and professional development programs, our members receive exclusive discounts on products and services and are provided numerous opportunities to get the word out about their unique value.

one renaissance square • 2 n. central ave • suite 750 • phoenix, az 85004

Take a fresh look and watch us grow with you as we continue to offer you membership benefits that will bring you closer to meeting your business goals.

@aztechcouncil

aztechcouncil.org

aztechcouncil

602.343.8324

Education

Series on Growing Revenues

Silos as Structures for Better Prospecting and Sales

by Mike Toney

Our last two articles dealt with how attitudes affect your efforts to grow your business. Here, we’ll see how to break the sales process into two parts to make a stronger whole.

Myth: Sales Is a Numbers Game The number one request I get from salespeople and their managers is, “Can you help me manage my time?” This is because the construct “Sales is a numbers game” has endured over a millennia, and its most common corollary is the axiom “If you want more, do more.” By this thinking, my consistently meeting with three appointments and closing one deal would lead me to conclude that, to get two deals closed, I need to get six appointments. While there is some truth in this approach, it is limiting. What happens when we need to get to 16 deals? We need 48 meetings!

That’s why people don’t have any time; they are running on the hamster wheel of sales.

reasons or information about the budgeting and decision process by which you can differentiate yourself from the competition in such a way that it is not about price — to convert these opportunities into business. A two-fold measure of success in this silo is the ratio of number of opportunities to number of deals closed and the projected margin or revenue generated. The sales silo feeds the fulfillment silo, which is concerned with the ability of the organization to fulfill the promises of the salesperson. Measurements typically include actual margin and customer satisfaction or Net Promoter Score (NPS). Finally, the fulfillment silo feeds the account management silo, which is where the sales or customer service person would be measured on upselling and on the health of the relationship.

Are Silos the Answer?

Silos are adjacent job functions in the company that touch each other. Think of it as wearing different hats in a day. Breaking up any given job into silos that coordinate with each other will increase production and minimize waste (e.g., time for the salesperson) as long as you understand how the silos interact with each other.

The four silos to consider in the sales process are prospecting, sales, fulfillment and accounts management. In the prospecting silo are all the strategies for creating compelling conversations, based on sources from marketing, networking and cold-calling. Measure success in this silo by the quantity of new opportunities each week or month. The sales silo is comprised of strategies and tactics — such as discovering compelling

The Structures: Prospecting Silo Amplifies the Sales Silo Let’s focus on the first two silos, prospecting and sales, to show how you will amplify the results if you work the two together. This builds on the case I made in the first article in this series, that you must determine your core reason for being in business. With your core reason established and understood, you can then prospect to the better-fitting clients and align your solution to their issues. Wouldn’t that make it easier to get an appointment?

Wouldn’t that make you look better than the competition? You could tailor an approach better than the generic, “Mr. Prospect, my name is Doug. I’m with ABC Company, and we have developed the perfect solution for you!

Sales — the Education Series

Sales Is Not a Bad Word!

Compelled to Sell: It’s a Process

Silos and Structures of Revenue and Sales

Systems and Correct Measures of the Sales

Building Your Sales Team Correctly

Strengthening the Bench

To reference published segments, please access the archived “Education” articles on the In Business Magazine website, www.inbusinessmag.com.

Would Monday or Tuesday be better for you to have me come by to show you our solution?”

A cold call I received a few years ago from a sales professional that quickly qualified me as a strong prospect went like this: “Mike, my name is Doug. I don’t want to waste your time; I know you are busy. Can I have 30 seconds to tell you why I called?” When I told him, “Sure,” he said, “We only need to continue talking if, as a business owner, you are frustrated making rent payments to a landlord or if you don’t appreciate how your landlord continues to accelerate your fees year over year, impacting your margins. Is that your world at all?” My answer was yes, and I was hooked!

Sales, by my definition, is “compelling communication that creates a new action” — and wouldn’t it be easier to compel people to buy or spend more if you had a prospecting silo that generated a better quality lead, with people who were decision makers? Wouldn’t that increase your closing ratio and fill your sales silo?

Wouldn’t that increase the average size of your deals? Wouldn’t it make you more effective?

Most of the answers are, of course, “YES” — because it’s not a numbers game, is it? It’s about people and how well you align emotionally to the prospect in all stages of selling. The better your salesperson aligns with the prospect’s world, the higher your closing ratio, the bigger the deals and the more referrals and introductions you gain.

Conquest Training Systems, Inc. conquesttraining.com

Michael Toney, CEO of Conquest Training Systems, drew from 20-plus years of education and experience in sales and sales training — including consulting with TRW, IBM, Allied Signal and other Fortune 50 corporations — to develop the dynamic program of leadership and consultative and strategic sales techniques.

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“We must view education as an investment, not an expense.”

SHELLEY ESQUE Vice President, Intel

The education we provide for Arizona’s children will determine the kind of future we all enjoy. Arizona employers need a highly skilled, talented workforce to diversify our economy, increase job opportunities and stay competitive.That requires a stronger education system that begins at birth and continues through career.

By investing time, talent and money to improve education today, we better position Arizona for long-term success. In the end, we all benefit. Education is everyone’s business. Make it your priority.

Visit ExpectMoreArizona.org.

ASSETS

2012 Jeep Grand Cherokee SRT8 Jeep has struggled to resurge its SUVs from the utility four-wheel-drive standard to the souped-up sporty utility vehicle it seems to have achieved with the 2012 Jeep Grand Cherokee SRT8. Speed, refined styling and reliable mechanics will make this 2012 stand out.

Jeep debuted the original SRT8 in 2005 as allAmerican and meant to impress by its tough presence backed up by overall impressive engineering. The 2012 is even better. With European support and built on the Mercedes ML platform, this beast is spacious and mean. Its smooth styling looks and feels solid and eliminates the “standard” utilitarian presence drivers have come to expect. Twenty-inch wheels with Pirelli Scorpion Verde all-season tires and optional Pirelli P-Zero summer tires give the 2012 its sporty stance, and it features a braking system using Brembo brakes and rotors — increased to 15 inches from the 2005 model’s 14.2 inches — that Jeep claims results in a 118-foot stop from 60 miles per hour.

The 6.4-liter engine comes from the 2011 Dodge Challenger SRT8 392. Jeep says this is 2012 Jeep Grand Cherokee SRT8 the most powerful production model they have City MPG . . . . . . . . . . . . . . . . . . . . . . . . . . 12 ever sold and that it will do zero to 60 in Hwy MPG. . . . . . . . . . . . . . . . . . . . . . . . . . 18 4.8 seconds. Its 470 horsepower will take 0-60 MPH. . . . . . . . . . . . . . . . . . . . 4.8 sec this SUV to a maximum speed of 155.

Transmission. . . . . . . 5-speed manual The interior is a comfort, reminiscent MSRP. . . . . . . . . . . . . . . . . . . . . . . . $55,295 of a sports car but with plenty of room.

Jeep added vented and heated front seats and heated rear seats. An optional 19-speaker surround-sound system from Harman Kardon includes a 10-inch subwoofer and boasts 825 watts. The digital panel displays realtime stats that include 0-60 average times, g-force and horsepower among other necessary gauges.

Jeep jeep.com

by Mike Hunter

We Value What We Own

Date & Time: Business Calendars for 2012 Schedule and time may be the two most precious assets a businessperson has. Each year, we look to what gadgets are available to make scheduling our time a breeze. Here are our picks for great accessories.

Week Cal App – This iPhone app is considered the best third-party app for the iPhone.

More workable and useful than the app incorporated with the iPhone. $2 Utili Tap utilitap.com

Tiffany 1837 Perpetual Calendar – This calendar will last a lifetime.

The desktop sterling silver frame will look great in the executive office or reception.

Calendar month inserts available forever. $360 Tiffany tiffany.com

2012 Calendar Paperweight – There’s an art to keeping piled-up paperwork under control — and this helpful desk décor manages reams beautifully. Silver-plated calendar paperweight. $25

Day-Timer 2-Page-Per-Day Desk Calendar – Plenty of space to capture notes, to-dos, phone messages and more. Subtle pink and grey design elements show your support for breast cancer research. $24.99 Day-Timer day-planner.daytimer.com

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Photos: Chrysler Group LLC. (right), Utilitap, Tiffinay, Neiman Marcus, Day-timer (left, top to bottom)

Neiman Marcus neimanmarcus.com

“Turning Obstacles Into Opportunities Together” Banking and Credit Relationships Establishing complete banking and loan relationships for small to mid-size business clients.

Financial Acumen Assist businesses to properly produce accurate financial information for their company and to understand what the financials tell them.

Expense Reduction Review and recommendations to reduce operating expenses.

Accounting/Bookkeeping Services Our accounting service provides businesses with accurate and timely financial accounting and bookkeeping services tailored to the individual client’s needs.

Stoney-Wilson Business Consulting, LLC www.stoneywilson.com Julie Stoney

6501 E. Greenway Pkwy #103-583 Scottsdale, AZ 85254

(602) 370-1776 juliestoney@stoneywilson.com

Robert S. Wilson

(602) 696-1060 robertwilson@stoneywilson.com

Scottsdale

Los Angeles

Orange County

San Francisco

Real Estate Finance Real Estate Development Office, Industrial and Retail Leasing Real Estate Brokerage Issues Construction Disputes Purchase and Sale Agreements Partnership Dispute Resolutions Workouts of Troubled Projects Equity Investments Tax Credits Fund Formation Syndicated Investments Portfolio and Syndicated Credit Facilities Project Finance In Arizona, please contact: Bank & Finance | Corporate | Insolvency & Financial Solutions Intellectual Property | Labor & Employment | Litigation Real Estate | Tax and Estate Planning

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Paul M. Weiser, Esq. Managing Partner 480.383.1800 | www.buchalter.com

J a n u a r y 2012

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Power Lunch

by Mike Hunter

Meals that matter

Resolution: Do a Healthy Lunch

It’s a new year and all that is on most of our minds is that silly resolution we make each year about our weight. Well, keep it up this year. Here are some of the Valley’s best places to enjoy a tasty yet healthy business lunch.

Green New American Vegetarian Scottsdale & Tempe

Green is a 100-percent vegan-vegetarian restaurant that masters all favorite comfort foods and celebrates vegetables. Chef Damon Brasch has created a menu that is sure to please any palate.

2022 N. 7th Street, Phoenix (602) 258-1870 2240 N. Scottsdale Road, Tempe

(480) 941-9003

greenvegetarian.com

True Food (pictured) Phoenix & Scottsdale

Simple, fresh and pure ingredients are what make this concept by executive chef Michael Stebner; Andrew Weil, M.D.; and Sam Fox a true hot spot.

“Flavorful” and “innovative” describes this modern eatery. The atmosphere is perfect for a relaxing and filling lunch.

Biltmore Fashion Park, Phoenix (602) 774-3488

Durant’s, the nostalgic place for a business lunch in the Valley, is a great way to start the New Year. A classic ’50s steakhouse recently named one of the nation’s top 20 power-lunch spots by Zagat, this is a place where even Frank Sinatra would do lunch on a regular basis.

A dark, moody atmosphere with red booths and a design right out of a boozy “Mad Men” episode, Durant’s lives up to its reputation. Opened in 1950 by namesake Jack Durant, this unassuming landmark was home to the business deals, political movements and shaping of what we know as Phoenix, Ariz.

Jack was quoted as saying that “good friends, great steaks and the best booze are the necessities in life.” He must have been right, as those three things seem to be what has kept Durant’s an “in” choice for 61 years.

The menu is made up of some traditional dishes born out of the 1950s. Entrée salads, broiled New York steak and the classic Chop House Burger are just the beginning of what is offered over lunch. Shrimp cocktail with a tangy, hot, cocktail sauce; oysters on the half-shell; or the Durant’s Cobb Salad will make your lunch special. Service that feels like your own private party and an attentive staff that will impress your clients makes Durant’s more than just a tradition — it truly is a hot spot.

Celebrities come to Phoenix and visit Durant’s; sports stars are known to lunch here with their agents; and local businesspeople are seen signing that big deal right here at Durant’s. The Central Avenue and Virginia location is convenient to light rail if you are downtown and has onsite parking for ease during that midday rush.

truefoodkitchen.com

Zoës Kitchen Phoenix & Scottsdale

Eat well at this modern, fast-casual restaurant featuring Mediterranean-inspired comfort food with made-from-scratch recipes using only fresh ingredients.

1641 E. Camelback Road, Phoenix (602) 263-9637 521 W. McDowell Road, Phoenix (602) 716-0070 7135 E. Camelback Road, Scottsdale (480) 947-3288 zoeskitchen.com

Durant’s 2611 N. Central Avenue • (602) 264-5967 • durantsaz.com

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Photos: Durant’s (top), True Food (bottom)

Durant’s: Classic Lunch in Time

Scottsdale Quarter, Scottsdale (480) 265-4500

scottsdalechamber.com

MEMBER COMMUNIQUÉ Redefining Value Who among us had not been forced to become more nimble in recent years? Like a boxer dodging jabs to the head and the occasional body blow, most of us in business have improved our footwork but taken a few shots on the way to redefining value.

Every business rises or falls on their customer base making a conscious choice to allow you to serve them. Those who refuse steadfastly to change likely will have a more difficult time dodging the jabs. Those who Rick Kidder embrace change will likely inadvertently find ways of alienating some for whom the changes most affect. Nothing about change is easy, and change all too often is perceived differently from the way it is intended.

Change is also exhilarating in many ways. Businesses that have done the same things in the same way for probably too long are looking at new and energizing ways to make their businesses succeed. Many are doing so with fewer people and less resources, but all are attempting to change around the concept of providing greater value.

Chambers of commerce were founded on a tried and true model for connectivity and business growth. The model, unaltered for generations, defined value as community stewardship, making and working contacts and member to member discount programs. Sadly, few companies can afford the luxury of community stewardship for its own sake. Networking events, many available without membership, could fill one’s calendar from beginning to end. And discount programs only work if they are used.

In today’s economy and in today’s more complex world, chambers must develop new and different value propositions in order to serve the business community well. There is no single value proposition because companies differ in their needs, but no organization can afford to attempt to provide all things to all businesses. Instead chambers must apply a laser-like focus on areas of core competency, choosing the areas where they can make a real difference and truly add value.

The Scottsdale Area Chamber of Commerce has asked the question, “How can we make the lives and work of our business members better – in ways that others cannot?” We are only at the beginning of answering that question, and we are likely to try some things we later abandon, but we do know that with the strong support of the business community we can lead the way in Business Advocacy, Business Resources and Economic Development.

Rick Kidder, President/CEO

January 2012 - April 2012

Key Areas of Focus The Scottsdale Area Chamber of Commerce is strongly focused on three primary areas and the actions that naturally flow from them. Business Advocacy, Economic Development and Business Resources are central to meeting the needs of our membership and to the long-term sustainability of the organization.

Business Advocacy: Small businesses rarely can keep abreast of the political landscape that affects their ability to do business every day. It is the Chamber’s responsibility, through layers of committees and advisory councils comprised of members, to review important issues at the local, state and federal level and to advocate on behalf of the business community as a whole. A strong voice for business requires a process for reviewing issues on an ongoing basis through involved members, an engaged and informed Board of Directors and a staff that fights on behalf of the business community every day. The Chamber supports or opposes legislation and regulation, testifies regularly before public bodies and provides opportunities for business people to engage political leadership directly. Acting through a strength in numbers approach, the Chamber has a strong voice and a commitment to a balanced, business-friendly environment. Whether a complicated major policy issue or a particular challenge confronting a single business member, the Chamber is here to help.

Economic Development: Arizona competes against other states to attract and retain quality businesses that add jobs and contribute to our state’s fiscal health. Within the state, communities compete with each other to attract and retain quality businesses to help those cities grow economically for the benefit of all citizens. The Chamber, working alongside state, regional and local economic development entities, is a major contributor to the economic vitality of our state, region and city. Through our Economic Development Advisory Council and its sub-committees on Business Attraction and Business Retention, the membership has a strong involvement in advancing our economic prosperity.

A resource and a partner for the City of Scottsdale Business and Economic Vitality Office, the Chamber works every day to build a stronger economy and attract and retain jobs.

Business Resources: Business resources is where the proverbial rubber meets the road of Chamber business. Whether through education programs targeted at business members who look to grow or spend more wisely or through connectivity events that bring business people together within a context Continues on pg. S@W 07

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Congratulations Sterling Award Excellence. Innovation. Community Stewardship. These are just a few words that describe this year’s finalists for the 2011 Sterling Awards, our annual awards program recognizing the best and the brightest businesses in Scottsdale. The event was held

Tuesday, November 29th at the Chaparral Suites Resort in front of a capacity crowd. From large corporate entities to nonprofit organizations bettering the community, all of these businesses are at the pinnacle of their industry, leading by example and

Micro Business (1-6 Employees)

Small Business (7-99 employees)

Recognizes an emerging business exhibiting success through innovation, creativity and collaboration.

Recognizes a small company demonstrating innovation, quality, professionalism and commitment to community.

(HONOREE)

(HONOREE)

Reliable Background Screening • reliablescreening.com Since 1990, Reliable Background Screening has been providing clients a unique and thorough screening service for employers, business owners and landlords by offering background checks on new employees and new residents. Their expert staff is both efficient and friendly, and their wide range of services allows clients to effectively and affordably obtain the background screening that helps shield their companies from the perils of an uncertain world, while also helping maintain compliance with FCRA regulations (Fair Credit Reporting Act). Reliable Background Screening services clients in more than 40 states, and is the exclusive Preferred Provider of the Scottsdale Area Chamber of Commerce for background screening services.

GlobalMed • globalmed.com

(FINALISTS) Breslau Insurance & Benefits, Inc. • breslauinsurance.com Breslau Insurance & Benefits, Inc. is a Life & Health agency providing medical, dental, disability and life insurance to employer groups as well as individuals and families. Breslau Insurance first seeks to understand the unique insurance requirements and desires of each client and prospect. They evaluate all products on the market to find the best solutions, thoroughly explain choices and options, and then implement the selected solutions. Unlike many competitors, Breslau Insurance reviews coverage and rates annually as part of their considerable customer service pertaining to claims, billing, and enrollment. Breslau Insurance prides itself on being service oriented and responds promptly to every issue, big or small.

(FINALISTS) Homeowners Financial Group • homeownersfg.com Homeowners Financial Group is an award winning, Arizona based Mortgage Banker leading the Valley in Residential Lending. The company was founded in 2004 by finance and mortgage executives with over a century of expertise in residential lending. HFG’s core business is comprised of residential mortgage lending providing loan programs such as FHA, 203K, VA, Conventional, HomePath, First Time Homebuyer and Reverse Mortgages.

They also have numerous relationships with some of the Valley’s most prominent Real Estate Companies and Builders who refer their clients because of the confidence they have in the staff at HFG.

Arizona Community Farmers Markets @ Old Town Scottsdale arizonafarmersmarkets.com The mission of Arizona Community Farmers Markets @ Old Town Scottsdale is to promote the growth of local organically raised farming and ranching products. Each Saturday the Market presents 70 to 80 local growers, ranchers, food manufacturers, and chefs, while also bringing in more than 2,500 visitors. The Old Town Scottsdale Farmers Market is located in the midst of a very large concentration and wide variety of restaurants. Many of the chefs of these restaurants are buyers of the Farmers Markets’ local growers, ranchers and food manufacturers in their efforts to present local ingredient-based cuisine to Valley residents and visitors.

Hot Air Expeditions • hotairexpeditions.com Hot Air Expeditions is a hot air balloon ride business offering flights over the beautiful Sonoran Desert daily throughout the entire year. Their experience includes a hot air balloon flight, as well as a traditional champagne toast upon landing. Following the toast, guests are greeted with either a warm breakfast or sunset hors d’oeuvres catered by Vincent’s on Camelback, presented on tables complete with linens, crystal and china. To make the memory last a lifetime, each guest is presented with a commemorative flight certificate.

Their customers are local people celebrating special events or tourists visiting our city. Hot Air Expeditions love what they do and it shows!

2243 E. Rose Garden Loop Suite 1 • Phoenix, AZ 85024 480-502-8999 tel 602-867-2030 fax 1-800-831-7610

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m pa .co upu ndaw il: a y @ a zlink

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GlobalMedia (DBA GlobalMed) designs and manufactures telemedicine solutions for hospitals and clinicians that permit the TM expertise itself to travel instantaneously over great distances. GlobalMed’s telemedicine products are assembled at their Scottsdale headquarters and shipped to customers around the world. Their telemedicine carts improve the lives of Arizonans outside Scottsdale and around the world. They are currently being used at the nine Arizona hospital hubs of Mayo Clinic Scottsdale’s Telestroke Network. They link stroke patients in towns like Bisbee, Flagstaff and Williams to neurologists at Mayo who can prescribe the clot-busting drugs that work to minimize the effects of a stroke.

In Business Magazine

Honorees and Finalists! inspiring other businesses to overcome today’s challenges and savor the successes earned by rising above the rest. Four teams of volunteer judges evaluated all applicants, and these are the results announced November 29th:

Big Business (100+ Employees)

Non-Profit

Recognizes a large company making a significant impact on the lives of its employees and the economic fabric of the community.

Recognizes a charitable organization contributing to the social, cultural, educational well-being of its constituents.

(HONOREE) DMB Associates, Inc. • dmbinc.com DMB Associates has focused on building and planning sustainable communities that responsibly address the environment for over 25 years. They are deeply committed to community stewardship, and the health and well-being of their employees and the communities where they work. Founded in 1984, DMB Associates, Inc.’s projects include signature commercial properties, resort/recreational and primary home communities, country clubs, health clubs and spas located in Arizona, California, Hawaii and Utah. Working in partnership with local conservation and environmental organizations, DMB has supported the protection and conservation of unique habitats and sensitive lands in Arizona, Utah, Hawaii and California.

(FINALISTS) Hotel Valley Ho • hotelvalleyho.com The hotel was built in 1956 and was the first hotel in Scottsdale to feature Southwestern design, to have air conditioning, and to be open year-round. The Valley Ho has been a resting stop for many Hollywood stars throughout the years including Zsa Zsa Gabor, Bing Crosby, and Tony Curtis.Robert Wagner and Natalie Wood also had their 1957 wedding reception at the hotel. Another unique quality of the hotel is its mid-century modern style, designed by local architect Edward Varney. Hotel Valley Ho is considered “one of the best-preserved mid-century hotels in the country”, according to architect and author Alan Hess.

Magellan Health Services of Arizona • magellanhealth.com Magellan Health Services of Arizona is pleased to be able to help children and adults in central Arizona.

Since 2007, Magellan Health Services of Arizona has worked to bring voice and choice to the region’s 84,000 people who face life challenges due to mental illness or substance abuse disorders., Magellan established a local governance board composed of community members and individuals served by the system, launching an unprecedented era of open communication. This shift gives recipients a choice in where and how they would like to receive services to aid in their recovery and helps them become contributing members to their communities.

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(HONOREE) Gabriel’s Angels • gabrielsangels.org Gabriel’s Angels delivers healing pet therapy to 13,000 abused, neglected and at-risk children. for the purpose of intervening in the cycle of violence. The goal of the program is to improve the emotional health and well-being of children and help them develop skills that are precursors to preventing the cycle of violence. Gabriel’s Angels provides consistent weekly or bi-weekly Pet Therapy visits, or animal assisted activities, to partner agencies, with the average visit lasting 60 to 90 minutes with groups of 10 to 12 children. There is no cost to the participating agency to receive therapy visits for their children.

(FINALISTS) National MS Society, Arizona Chapter nationalmssociety.org/chapters/AZA/index.aspx Since 1956, the Arizona Chapter has worked tirelessly to improve the quality of life of the 45,500 people affected by MS throughout Arizona. The Society helps by funding cuttingedge research, driving change through advocacy, facilitating professional education, and providing programs and services that help people with MS and their families move their lives forward. Their work here in Arizona has been focused on reaching under-served and rural populations, providing programs and services to people with MS that will improve lifestyle behaviors, and building more community partnerships to improve access to care and support for their client population.

Scottsdale League for the Arts • scottsdaleculinaryfestival.org Founded in 1978, the Scottsdale League for the Arts™ has distributed its funds to the Scottsdale Cultural Council in support of education programs of the Scottsdale Center for the Arts and, more recently, the Scottsdale Museum for Contemporary Art. The League’s signature event, The Scottsdale Culinary Festival™, held every April, has been hailed one of the premiere culinary events in the United States. Funds have also been distributed to the Scottsdale Arts in Education Council. Since 1992, the League has contributed more than $63,000 towards scholarships for students enrolled in culinary programs. To date, the League has distributed over $3.1 million in grants.

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Chamber Members, Meet PROMPT CARE. What is PROMPT CARE? PROMPT CARE is an exclusive program designed to provide immediate care for minor illnesses or injuries for employees of enrolled Scottsdale Area Chamber of Commerce businesses.

Who can use the PROMPT CARE service?

PROMPT CARE is only available to employees of Chamber member businesses. Family members, children, spouses, partners, etc. are not eligible to receive PROMPT CARE services.

How does PROMPT CARE work?

Employees seeking immediate care for minor illnesses and/or injuries must first obtain a PROMPT CARE Referral Form before each visit to the physician. Please speak with your immediate supervisor to obtain this form.

How much does the PROMPT CARE service cost?

For employees who are not insured, the cost is $35.00 for the assessment and treatment of minor ailments.

In the case of insured individuals, insurance will be processed as normal with the appropriate co-pay.

When and where can I use the PROMPT CARE service?

Employees seeking immediate care for minor illnesses and/or injuries can visit the three Scottsdale Healthcare Occupational Health Clinics listed below during regular business hours.

For more information please visit www.scottsdalechamber.com or call us at 480.355.2700.

PROMPT CARE Locations Shea Campus

10200 N. 92nd St., Ste. 100 Scottsdale, AZ 85258 (p) 480-323-3818 (f) 480-323-3238 M-F: 7:30am to 5:00pm

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Osborn Campus

3501 N. Scottsdale Rd., Ste 231 Scottsdale, AZ 85251 (p) 480-882-4770 (f) 480-882-4391 M-F: 7:30am to 5:00pm

Airpark Campus

16101 N. 82nd St., Ste. A-8 Scottsdale, AZ 85260 (p) 480-323-1880 (f) 480-905-1136 M-F: 7:30am to 5:00pm

In Business Magazine

Grow Your Bottom Line Grow your bottom line by maximizing your business exposure while also receiving great local deals!

SHOP MEMBERS! Discount Program will feature member offers and discounts to chamber members and non-members alike on our SHOP MEMBERS! webpage located at www.scottsdalechamber.com.

Shop Members! Discount Program offers a variety of savings, from hotel rooms to waste removal to shipping! The Chamber is offering this

In Business Magazine

special discount program to help you save money and grow your bottom line. Shop Members!

Discount Program also gives your business an avenue to showcase your services and products!

This is a great way to maximize exposure among members and non-members of the Chamber.

The process is simple: You, a Chamber Member, may offer a customized discount for your services or products. Your discount offer

must be valid a minimum of six months, and must be a direct savings to the consumer. Visit www. scottsdalechamber.com to start saving and to fill out a SHOP MEMBERS! Discount Application for your business!

Have questions? Contact Sarah Biddlecome at sbiddlecome@scottsdalechamber.com or 480.355.2708.

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New Programs at the Chamber Breakfast with a Side of…

Airpark Forum

The Scottsdale DoubleTree Resort by w i t h a s i d e o f ...

SCOTTSDALE CHAMBER Hilton has teamed up with the Chamber to host “Breakfast with a Side of…”—a series of forums that provides guests an excellent opportunity to learn about the issues affecting the Scottsdale area business community. The forum is structured on dialogue between those leaders making policy decisions and those attending the event, all while enjoying a delicious breakfast!

Each forum features a conversation with influential leaders in Scottsdale, highlighted by a guest speaker. A moderator conducts a series of questions, and allows plenty of time for guests to ask questions as well.

The Chamber kicked off this great event with “Breakfast With a Side of…Politics,” featuring the city’s three councilwomen: Lisa Borowsky, Suzanne Klapp, and Linda Milhaven. The Councilwomen gave their feedback on the city’s biggest issues, talked about the major projects they are working on, and discussed the overall future of Scottsdale.

The Airpark is the second largest employment area in Arizona. Its diversity is its strength, and its voice should be strong. The Chamber feels that the future of the Airpark should not be left to others to create, and that is why our Airpark Forum is so important. Airpark Forum is an Education Program with a focus on topics relevant to the Airpark. The purpose of each event is to connect, inform, and advocate for business within the Airpark. This working breakfast, in which every participant has a voice, is a unique opportunity to help shape the future of Scottsdale.

The Chamber’s first Airpark Forum was held November 9th at Zona Hotel & Suites entitled: “Connecting the Airpark to Create an Economic Powerhouse!“ It consisted of dialogue between Airpark business leaders Andrew Bourne, CEO, WayPoint LLC; Marc Joseph, CEO, DollarDays International; and Bob Tunis, Economic Development Manager for the City of Scottsdale. Airpark Committee Members facilitated and recorded questions from guests that were later addressed by the panel of committed Airpark advocates.

If you are interested in attending the Chamber’s next “Breakfast With a Side of…” or Airpark Forum please contact Courtney Gilbert at 480.355.2704 or cgilbert@scottsdalechamber.com.

Connect with the Chamber

Become a fan on Facebook: www.facebook.com/ ScottsdaleChamberFans

Join our Groups on LinkedIn

View photos from our events on our flickr page: www.flickr.com/photos/ scottsdalechamber/sets

Follow us on Twitter: twitter.com/ScottsdaleChmbr

Check out our YouTube Channel: www.youtube.com/user/ scottsdalechamber Follow our blog at http://scottsdalechamber. blogspot.com/

Republic Digital Media Series

The Value of Education

Republic Media Digital Solutions has partnered with the Scottsdale Area Chamber to host digital seminars educating local business decision makers about ways they can use digital media to grow their client base. The goals of this digital media series is to educate Scottsdale businesses about various digital products such as search engine marketing, social media, and online display advertising powered by behavioral targeting.

The first Republic Media Digital Education Program covered basic and intermediate knowledge of search engine marketing, including paid inclusion (pay-per-click) and search engine optimization. In addition, participants received a free evaluation of their business ranking, and that of their competitors.

To learn more about this new series and to register for our next Republic Media Digital Education Program, please contact Courtney Gilbert at 480.355.2704 or cgilbert@ scottsdalechamber.com.

Successful business owners share a common thread – a commitment to learning. The Chamber’s educational programs are designed to teach you new business skills, share resources, exchange ideas and give you a competitive edge. Republic Digital Media Series and AZSBDC Seminars are just two of the many educational programs the Chamber has to offer.

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AZSBDC AZSBDC is Arizona’s largest and most accessible source of assistance for small businesses at every stage of development. Providing free, one-on-one business counseling, planning assistance, technology development and identifying sources of capital are only some of the services that AZSBDC provides.

The Chamber has teamed up with AZSBDC to provide businesses the opportunity to attend seminars ranging from start-up assistance to tax planning. These workshops last approximately two hours and are available at multiple valley locations.

To learn more about AZSBDC’s services and educational programs, contact Rachel Busch at 480.355.2703 or Rachel.busch@domail.maricopa.edu.

In Business Magazine

Continued from pg. S@W 01 of relevance, the Chamber continually revamps and improves its programs and services areas to provide fresh programming for its members. Our goal is to advance our membership in their skills and information and to promote them through our many opportunities for involvement. Through connectivity events and committee work, our members gain leadership opportunities and gain exposure to others in the business community. The “Shop Members” discount program provides Chamber businesses with opportunities to build their customer base and to keep dollars in the local community. Our unique partnership with Scottsdale Healthcare with the PromptCare program allows for insured and uninsured employees of Chamber member companies extremely affordable healthcare treatment options.

Chamber members always have the option of choosing their degree of involvement, secure in the knowledge that we exist to help make others aware that they are part of this great organization. Our members are the key to our success, and without them we could not offer such robust value. Membership helps the rising tide lift all boats, improving the condition of every business.

Mike Binder Managing Editor Scottsdale Area Chamber of Commerce Caroline Cogman Assistant Editor Scottsdale Area Chamber of Commerce

Rick Kidder President & CEO rkidder@scottsdalechamber.com 4725 N. Scottsdale Road, Suite 210 Scottsdale, AZ 85251 Ph 480.355.2700 fax 480.355.2710 www.scottsdalechamber.com

Board of Directors Executive Committee Board Chair Kurt Zitzer Meagher & Geer, PLLP Vice Chair Eric Larson AVB Development Partners Immediate Past Chair Karen Wittmer-Jekel Treasurer Mark Eberle Henry & Horne, LLP

Public Policy Advisory Council Bill Heckman Heckman Marketing Associates Member Value Advisory Council Steve Helm Westcor / Scottsdale Fashion Square AT LARGE MEMBERS Jennifer Bongiovanni Karas, Green Ideas, Inc.

Economic Development Kurt Brueckner Advisory Council Titus, Brueckner, Levine & Bryce Lloyd Johnson, PC FirstBank of Arizona Emerging Issues Angela Creedon ASU Public Affairs Scottsdale Partnership Melinda Gulick DMB Associates

Judy Egan JRE Enterprises, LLC Dale Fingersh The Right Direction Rick Kidder Scottsdale Area Chamber of Commerce

© 2011 Scottsdale Area Chamber of Commerce. A publication of the Scottsdale Area Chamber of Commerce. For more information or to join the Scottsdale Chamber, please contact us at www.scottsdalechamber.com. Section designed by InMedia Company, LLC.

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In Business Magazine

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SBS Tradeshow and Partner Council Wine Tasting @ iPic Theatre

The 2011 Scottsdale Business Showcase Tradeshow was held September 27th at the Chaparral Suites Resort. Our thanks to the host, sponsors and participants for a wonderful time! In addition, the Partner Council hosted a wine tasting October 12th at the incredible new iPic Theatres at the Scottsdale Quarter.

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Wine Tasting @

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1. Chamber Staff prepares the celebratory Tower of Cupcakes! 2. Heidi and Deb Jones show just some of what Business of Baskets can do! 3. Shawn Hill and Ashley Miller of Merestone. 4. Rick Stauffer demonstrates the value of Mr. Waterheater Arizona, Inc.! 5. The Goode Time Carolers were the hit of the show! 6. iPic’s beautiful restaurant, Tanzy. 7. Michele Greenberg, Andrew Bourne, John and Pam Kelly.

8. Bryce Lloyd, Scott Jenkins and Dale Fingersh. 9. Joni McGlothlin and Knox Kimberly. 10. Caroline Cogman and Courtney Gilbert welcome our guests. 11. Rick Kidder addresses the crowd. 12. Michele Greenberg and Kurt Brueckner. 13. Patrick Hanley demonstrates the art of networking.

8 - scottsdalechamber.com

In Business Magazine

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NAWBO Phoenix Metro Chapter celebrates 25 years of serving as the voice and

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NEWS asba.com | Winter 2011

Inquiring Minds Want to Know

by Donna Davis, ASBA Chief Executive Officer According to the U.S. Small Business Administration, 97% of the businesses in Arizona are classified as small business, using the federal

About ASBA

definition of less than 500 employees. Nationally, 99.7% of all employer firms are small business. Obviously, small businesses have a significant

The Arizona Small Business Association

impact on the economy, locally and nationally. Below are three questions I

(ASBA) is the largest trade association

am frequently asked.

in the state representing 11,000+ member businesses, and over 1/2 ASBA members enjoy access to

Q: What is the biggest challenge facing small businesses?

significant group discounts, countless

We have repeatedly surveyed our 11,000+

opportunities to do business with each

business members, and the number one

other, a wide array of insurance

challenge is lack of sales and weak demand for

products, and active advocacy efforts on

their products and services. While we hear

public policy issues to protect their

“jobs, jobs, jobs” so often, our mantra is “sales,

businesses. Discover more at

sales, sales.” Businesses are not going to hire

million employees in all 15 counties.

www.asba.com.

additional employees if the work, projects or

Join ASBA. Be amAZed®

in this issue

sales are not there.

Uncertainty is not helping either. 78% of the U.S. economy is driven by consumer spending.

Erosion of business confidence is led by the stubborn problem of consumer spending. There

Small Business Leads

is an emotional and psychological aspect to the

the Way to Recovery . . . . . . . . . pg. 2

economic challenges. The uncertainty and unknowns created by government at all levels, the media and others really gives small business

ASBA Receives USDA Rural

owners the “heebie jeebies.” We don’t know what our costs are going to be in the near future.

Development Grant. . . . . . . . . . . pg. 4

Many businesses are stockpiling cash, doing more with less and just slogging it out.

ASBA Annual Meeting, Volunteer

Q. Do small and big business work well together?

Celebration + Expo . . . . . . . . . . . pg. 6

A healthy business ecosystem needs productive and prosperous small, medium and large businesses in a variety of industry sectors. Small and large businesses working together can be

Central Arizona

a very fruitful, symbiotic relationship. Entrepreneurs and corporations need each other now more

4600 E. Washington Street, Suite 340

than ever.

Phoenix, AZ 85034 p. 602.306.4000

f. 602.306.4001

Chris Mackay, Economic Development Director for the City of Chandler says this about the relationship between small and large business. “I think it is important to note how large business

Southern Arizona

and small business work together to create a quality sustainable community. Let's take Intel, for

4811 E. Grant Road, Suite 262

example. Here in Chandler, we are fortunate to have had a relationship with Intel for more than

Tucson, AZ 85712

30 years and are currently the second largest employment site for Intel in the world. Forty to fifty

p. 520.327.0222

f. 520.327.0440

Chandler small manufacturing and industrial type businesses call Intel their largest client. If Intel wasn't here, chances are we would most likely lose those companies as well.

© 2011 ASBA. A publication of the Arizona Small Business Association. For more information or to join ASBA, please contact us at www.asba.com. Section designed by the Arizona Small Business Association.

(continued on page 04 of this section)

01

Small Business Leads the Way to Recovery

ASBA Board of Directors

by Joe Higgins, ASBA Board Vice Chair and Public Policy Committee Chair

Lynn Paige | Chair PerfectPower, Inc.

Joe Higgins | Vice Chair Sports Buzz™ Haircuts

Donna Robinson | Secretary Network Dogs, Inc.

Jacob Gregory | Treasurer Clifton, Larsen, Allen

Glenn Hamer Arizona Chamber of Commerce and Industry

In the past few months, it appears that the rest of the country and our political leaders in Washington are starting to realize what those of us at ASBA have known all along - small business makes the world go around. As we look to solutions for our economic downturn, we must realize recovery won’t happen until the small business owner decides it’s safe to risk again.

ASBA’s mission is to band together these fiercely independent entrepreneurs with the goal of providing support and a voice.

ASBA members know firsthand how difficult and lonely being the boss can be. It seems like these past few years have paid a heavy toll on small business owners. We’ve seen our lines of credit dry up, our customers pull back on spending, our competitors fall by the wayside, and our take-home pay shrink or go away all together. In the midst of all this, the small business owner

Ben J. Himmelstein

is seeing policies coming out of our government that are sending mixed messages to the

Wong Fujii Carter, PC

marketplace. Small businesses need predictability and certainty to open and expand. In the wake of banking reforms, healthcare overhauls and shifting regulatory environments, these policies

Roy Irwin Irwin Insurance & Investments, LLC

have loudly told businesses to sit back and hang on until the dust settles.

ASBA’s public policy efforts are aimed at educating, influencing and informing the political leaders

Debi Kuehn Kuehn Financial Education Services

in Arizona and the U.S. about what our members need to be successful.

The cornerstones of ASBA’s public policy efforts include: Doug Martin Good News Radio Broadcasting

Taxation that is Fair and Spent Efficiently ASBA supports users paying the true cost of the government services they obtain. ASBA

Dr. Jan Northup Management Training Systems, Inc.

members work hard and spend money with caution. They expect the same from their government.

Regulations Paul Smiley Sonoran Technology & Professional Services

Brad Specht Wells Fargo Advisors, LLC

Linda Stanfield Benjamin Franklin Plumbing

Mark Staudohar ACCENT’ Hiring Group

Victoria Trafton Victoria Trafton, Inc.

Excessive regulation and burdensome documentation are a strong hindrance to economic growth.

The cost of regulation represents a fixed cost that every small business must overcome before it can afford employees and generate growth. ASBA favors expediting business permitting and licensing practices.

Health Care Affordable access to a range of health care options and freedom of choice are critical factors to small business owners. In fact, ASBA’s survey of Arizona entrepreneurs identified the cost of health care as a significant challenge to the future of their businesses.

Economic Development Small businesses are the driving force in job growth and economic development in Arizona. In addition to reducing excessive taxes and regulations, ASBA favors legislation and incentives that enhance small business success.

Janice Washington Arizona Small Business Development Center Network

So the next time you pick up your dry cleaning, take the family out for dinner at a local restaurant, or get your car tuned up at the mechanic, realize that these small businesses are the backbone of our community. It’s time that policy makers and leaders in Arizona and the U.S. think of how their actions will affect the thousands of small business owners that are the true economic engines of our country. Support your local small businesses; they need your loyalty and dollars now more than ever.

02

asba.com | Winter 2011

ASBA Members Speak to White House Business Council On November 3, ASBA and USDA Rural Development hosted the White House Business Council “Winning the Future Roundtable with American Business” at ASBA’s Business Education Center in Phoenix. This is the second roundtable ASBA has hosted which provides business owners a forum to make their voice heard about what the federal government is doing to help or harm business. The roundtable discussion was led by U.S. Department of Agriculture Rural Development Under Secretary Dallas Tonsager, and attendees included business owners and leaders from across the state.

“Through these conversations with Arizona business owners, we can identify opportunities to streamline processes and help our entrepreneurs get to the resources that will help them make money and create jobs,” said Donna Davis, Chief Executive Officer of ASBA. “Turning to the innovative minds of small business will help us find

solutions to advance business in Arizona and the jobs necessary to support our communities.” ASBA is planning additional business roundtables and community discussions around the state to listen and provide feedback from more Arizona small business owners. If you are interested in learning more, please contact publicpolicy@asba.com.

In Business Magazine is read by those vested in business Valleywide

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03

ASBA Receives USDA Rural Development Grant to Support Rural Businesses The Arizona Small Business Association has been awarded a USDA Rural Development grant to provide specialized assistance to rural businesses and entrepreneurs in five Arizona communities that have been hard hit by the latest economic downturn and the worst wildfires in state history. The program will target (areas around) Alpine, Bisbee, Clifton, Nogales and Somerton.

“Our Entrepreneurial Accelerator will provide small business owners and entrepreneurs in these areas with a tool kit of resources to help them make money and save money,” said Donna Davis, CEO of ASBA. “We know that small businesses are critical to our economic recovery, and in these particular rural areas that have suffered from the recession and the wildfires, the need for solutions has never been greater.”

Starting in Nogales, AZ in January 2012 and moving to a new community each month, ASBA will bring along resource partners like National Bank of Arizona and SCF Arizona, training and business coaching partners like Constant Contact and the International Coach Federation, and mentoring experts from ASBA’s own T.I.M.E. Mentoring Program. Day 1 will include a community reception or town hall meeting providing an opportunity to meet local business owners and entrepreneurs to learn

Somerton, AZ Population: 12,754 Unemployment: 27.9% Median Household Income: $28,209

what issues they are facing that are most critical. Day 2 will feature timely, relevant business training and a resource fair focusing in on topics and information that can help the businesses make money and save money.

One of the top challenges facing businesses is a lack of sales and weak demand for their products and services. This is especially evident in these rural communities and towns which are in dire need of assistance having faced issues like the Wallow and

Nogales, AZ

Monument Fires, unemployment rates ranging from 8% to nearly 28% and a severe lack of resources.

Through the grant, businesses will also receive a one-year membership to the Arizona Small Business Association which will open up multiple opportunities for them to market themselves to the other 11,000+ ASBA members throughout the state, thus sparking new sales and opportunities.

“Our ultimate goal is to help these businesses sustain, survive and grow,” says Davis. The grant project will finish up in Alpine, AZ in May 2012.

04

Population: 20,017 Unemployment: 13.9% Median Household Income: $28,896

asba.com | Winter 2011

Alpine, AZ Population: 6,400 Unemployment: 14.8% Median Household Income: $35,059

Clifton, AZ Population: 2,297 Unemployment: 8.5% - 10.2% Median Household Income: $45,467

8 10 Bisbee, AZ Population: 5,996 Unemployment: 8.1% - 10.2% Median Household Income: $36,013

19

05

(continued from page 01 of this section)

Why big business needs small business: 1. Most big businesses are running lean and desire to keep headcount low.

ASBA Annual Meeting, Volunteer Celebration + Expo

2. Big firms frequently require specific expertise only available from a smaller company.

3. The need for fresh perspectives, new opportunities, and different approaches to problem solving

Thursday, January 12 | 8am – 12pm Sheraton Crescent Hotel 2620 West Dunlap Avenue, Phoenix, AZ 85021

4. Faster turnaround and responsiveness 5. Smaller projects that are not profitable for bigger vendors

Why small business needs big business: 1. Big business creates opportunities for ancillary businesses like restaurants, gas stations, printers, dry cleaners, etc.

2. Allows small business to be part of profitable supply chains 3. Assistance in getting innovative products and services to national and international markets 4. Financial assistance and access to capital

Q. Do individuals running small businesses really

Kick off the new year with a bang! Join us as we celebrate another amAZing year and honor our outstanding members, volunteers and partners.

Purchase Your Booth Today!

Maximize your connections by participating in the power packed Business Expo. We SOLD OUT of tables at our last Expo in August, so get yours today!

Booth prices start at only $100. Sponsorship opportunities available.

know anything about the economy?

While there may be isolated individuals who are not highly informed, the vast majority of small businesses have to

Visit asba.com | 602.306.4000

understand what is happening with the economy.

Changes in the economy, spending, taxes and regulations disproportionately impact small businesses; thus the majority of small business owners are aware.

Most small businesses and entrepreneurs are typically too

Mentor Match

small to have a public policy department or a cadre of

Start the year off right with a mentor that fits your business!

lobbyists like large corporations do. That is why

Thursday, January 26 | 8:30am – 10am

organizations like ASBA are so critical. We join together to

ASBA’s Business Education Center | 4600 E. Washington St., Phoenix

have a unified and powerful voice on public policy issues and keep small businesses informed. Current economic

Mentor Match is the 2012 New Year’s

and fiscal challenges make it more important than ever for

resolution event where business owners will

small businesses to speak with a unified voice on public

find their “mentor match made in heaven”.

policy issues. ASBA actively advocates for small

ASBA has brought together several of the top

businesses to ensure a more supportive pro-business

mentoring programs available giving you the

environment.

opportunity to hear an overview of each, as

Diversity, growth and change are actions to be embraced

well as a chance to meet one-on-one with

so our community won’t be left behind. At the end of the

those that are of particular interest. Make

day, we need ALL companies faring well to ensure a robust

plans to attend and take your business to the

and vibrant Arizona.

next level in 2012!

Sponsorship opportunities available.

Visit asba.com | 602.306.4000 for more details and to register.

06

asba.com | Winter 2011

ASBA Saved Me Money!

I needed 4 office chairs on a very tight deadline and budget. I went on

We moved to the ASBA endorsed AIP Solutions credit card processing

the ASBA Staples Advantage site and found them quickly and easily.

from a bank-owned system and immediately realized 2 major

Not only were they over 70% cheaper than what was listed on the

improvements: 1) The cost of each transaction was reduced; 2) The

regular Staples site, but I also got an extra 10% off at checkout. I was

amount of time required to deposit money into our account went from 48

able to get 4 chairs for the price of one, plus free delivery! That more

- 72 hours to 24 hours. We are pleased with the results of this transition

than paid for my ASBA membership!

and endorse this program to any small business. We are also able to clearly see our cost per transaction....something that was previously

Debbie Wilson, The Pentecostals of Phoenix Church

hidden in the multitude of miscellaneous charges and fees.

Andy Hann, Fountain Hills Door and Supply

Learn more at www.asba.com/savings

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asba.com | Winter 2011

ASBA Staff Donna Davis, Chief Executive Officer Kristen Wilson, Sr. VP, Member Services + Programs Debbie Hann, VP, Finance + Administration Christy Coe, Director, Member Benefits Harold Gribow, Director, Association Safety Program Michelle Reynolds, Member Services Director Rhette Baughman, Marketing Manager Carol Mangen, Member Services Manager Gabe Salcido, Graphic Design Manager Sarah Travis, Receptionist Louise Abbott, Southern Arizona Support Marlee Roushey, Southern Arizona Support

Central Arizona 4600 E. Washington Street, Suite 340 Phoenix, AZ 85034 p | 602.306.4000 f | 602.306.4001

Southern Arizona 4811 E. Grant Road, Suite 262 Tucson, AZ 85712 p | 520.327.0222 f | 520.327.0440

Visit asba.com today!

08

What an AMAZING year! ®

Thank you to our fabulous members, volunteers, partners and sponsors for making 2011 such an amAZing® year! We could not have accomplished so much without all of your support. Let’s take a look back at some of the exciting events and milestones this year…

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Index Index by Name Ahlmer, Michelle, 20 Benjamin, Chris, 14 Borowsky, Lisa, 50 Bourne, Andrew, 50 Brewer, Jan, Governor, 35 Broome, Barry, 23 Clinton, Bill, 31 Collins, Jim, 31 Cosgrove, John, 32 Couri, Chris, 16 Cox, Tom, 16 Davis, Donna, 23, 55 DeWitt, Brent, 16 Eaton, John P., Ph.D., 20 Ehrenfeld, Peter, 23 Elliot, Jay, 31

Index by Company 20 Lounge Nail Bar and Boutique, 20 A.T. Still University, 54 Ahwatukee Chamber of Commerce, 36 Alerus Bank, 51 Arizona Aerospace & Defense Commission, 11, 23 Arizona Benefits Consultants, LLC, 30 Arizona Cattle Growers Association, 28 Arizona Chamber of Commerce & Industry, 36 Arizona Commerce Authority, 23 Arizona Community Farmers Market, 46 Arizona Farm Bureau, 28 Arizona Mining and Trading Company, 28 Arizona Office of Tourism, 28 Arizona Retailers Association, 20 Arizona Small Business Association, 23, 36, 37, 55 Arizona State University, 23 Arizona Technology Council, 23, 36, 39 Association for Corporate Growth, 36 Auction Empire, 16 Avnet Technology Solutions, Global, 23 AZ Small Business Development Centers, 50 Benefits by Design, 53 Biltmore Bank of Arizona, The, 12, 65 Blacktie Arizona, 33 Breslau Insurance & Benefits, Inc., 46 Buchalter Nemer, 44 Cancer Treatment Centers of America, 15

Faber, Brian, 20 Fraley, Lee, 12 Frye, Donn, 12 Fuentes, Raina, 66 Gaia, Jeffrey P., 12 Gallagher, Phil, 23 Goldwater, Robert W., 34 Griggs, Valerie, 20 Groseta, Andy, 28 Hann, Andrew, 23 Hanson, Morten, 31 Heasley, Kathy, 38 Henry, Sherry, 28 Herdt, Collin, 20 Higgins, Joe, 56 Jagos, Pat, 20 Jobs, Steve, 31

Johnson, Rick, 32 Joseph, Marc, 50 Kidder, Rick, 45 Klapp, Suzanne, 50 Kolberg, Sandy, Ph.D., 32 Lough, Kim, 66 Luttrell, Patti, 34 Mackey, Hank, 30 Magee, Andrew, 34 Malin, David, 20 McDonald, Bridgette, 20 McPheters, Lee, Ph.D., 28 McQuaid, Mike, 34 Migdol, Michael, 14 Milhaven, Linda, 50 Mollihan, Don, 30 Morfessis, Ioanna, Ph.D., 23

Olsen, Bill, 14 Panhuise, Vicki E., Ph.D., 11, 23 Potje, Susan Morrow, 16 Ramsey, Dave, 31 Rella, Dan, 16 Ryski, Mark, 21 Simon, William L., 31 Smiley, Paul, 23 Sobelman, Marc, 14 Toney, Mike, 40 Tovrea, Edward A., 28 Troisi, Rudy, 66 Tunis, Bob, 50 Watson, Sandra, 23 Weaver, Bill, 14 Williams, Susan, 66 Wright, Paul, Ed.D, 32 Zylstra, Steven, 23

Cassidy Turley BRE Commercial, 6 Celebration of Fine Art, 16 Center for Services Leadership, 4 Central Phoenix Women, 36 Children’s Cancer Network, 34 City of Scottsdale, 50 City to City Commercial, 14 Conquest Training Systems, Inc., 10, 40 Day-Timer, 42 Department of Homeland Security, 66 DMB Associates, 47 DollarDays International, 50 Durant’s, 44 Economic Club of Phoenix, 36 ECOtality, 14 Eller College of Management, 33 Executive Forums, 32 Expect More Arizona, 41 Fascinations, 20 First Solar, 23 Fountain Hills Door & Supply, 23 Gabriel’s Angels, 47 GlobalMed, 46 Goodyear Tire Company, 28 Grand Canyon University, 17 Greater Phoenix Black Chamber of Commerce, 36 Greater Phoenix Chamber of Commerce, 35, 36 Greater Phoenix Economic Council, 23 Green New American Vegetarian, 44 H.A. Mackey & Associates, 30 HeadCount Corporation, 21

Heasley & Partners, Inc., 38 Homeowners Financial Group, 46 Hot Air Expeditions, 46 Hotel Valley Ho, 47 HR Choice, 66 IKEA, 63 Insurance Info Desk, 14 Intel, 23 IO.INC., 23 Jeep, 42 Jennings, Haug & Cunningham, 66 Kaiser Family Foundation, 30 Linda Land AZ, 6 Magellan Health Services of Arizona, 47 Maricopa Workforce Connections, 13 Mayo Clinic, 68 Medtronic, 23 Mesa Chamber of Commece, 35, 36 Mesa Citrus Growers Association, 28 Momentum Specialized Staffing, 66 Musical Instrument Museum, 67 National Association of Women Business Owners, 36, 53 National Bank of Arizona, 5 National MS Society, Arizona Chapter, 47 Neiman Marcus, 42 North Scottsdale Chamber of Commerce, 35, 36 Peoria Chamber of Commerce, 36 Phoenix Convention Center, 7 Phoenix Zoo, 10 Power One, 23 Premier Lighting, 20

Prestige Cleaners, 12 Reliable Background Screening, 17, 46, 66 Republic Media Digital Solutions, 50 Rioglass Solar, 23 Roka Boutique, 20 SCF Arizona, 2 Scottsdale Area Chamber of Commerce, 35, 36, 45, 49 Scottsdale Double Tree Resort by Hilton, 50 Scottsdale Healthcare, 9 Scottsdale League for the Arts, 47 Snell & Wilmer, 12 Sonoran Technology and Professional Services, 23 Southwest Valley Chamber of Commerce, 37 Stoney Wilson Business Consulting, 44 Sunkist, 28 Surprise Regional Chamber of Commerce, 37 Tempe Chamber of Commerce, 35, 37 Thunderbird Charities, 34 Thunderbirds, The, 34 Tiffany, 42 Tovrea Stockyards, 28 True Food, 44 U.S. Citizenship and Immigration Services, 66 University of Arizona, 33 USDA Rural Development, 57, 58 Utili Tap, 42 VePoint Consulting Group, LLC, 11, 23 Vestar Development Co., 20 W. P. Carey School of Business, 4, 20, 28 Waste Management, 19 WayPoint, 50 We Do Lines, 16 Wells Fargo, 3, 61 West Valley Chambers Association, 35 West Valley Women, 37 Western Economic Analysis Center, 28 WESTMARC, 35, 37 Women of Scottsdale, 37 Zia Record Exchange, 20 Zoë’s Kitchen, 44 Zona Hotel & Suites, 50

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J a n u a r y 2012

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Roundtable

A Candid Forum

E-Verify:

Safeguards and Shortcomings

by RaeAnne Marsh

United States law requires employers to verify the legal status of their employees.

Arizona weighed in on the issue of illegal aliens with its Legal Arizona Workers Act of 2008, under which employers who hire undocumented workers risk suspension or revocation of their business license. E-Verify, an Internet-based system operated by the U.S. Citizenship and Immigration Services department of Homeland Security, answers that need. “If you were following the rules before, it’s the same rules,” says Raina Fuentes, office manager of Momentum Specialized Staffing, a Phoenix agency that helps businesses fill temporary staffing needs. E-Verify helps business owners comply with the rules, but its use is not mandatory in Arizona and not all businesses avail themselves of it.

Susan Williams, president and founder of HR Choice, attributes some of the reluctance to the early hype about E-Verify.

Small businesses may feel intimidated about registering because they will have to dedicate someone to handle the system — understand the procedures and obligations, go through the training process necessary to complete the “Memorandum of Understanding,” or MOU, that is required to register, and follow up with employees whose verification application comes back with a “tentative nonconfirmation.” “There was so much concern up front,” she says, “but now when I talk to [people], no one’s having a major problem.”

66

J a n u a r y 2012

The advantage of using E-Verify is considerable: It offers the employer the safety net of a “rebuttable presumption that the employer did not knowingly or intentionally hire an unauthorized alien,” explains Kim Lough, partner of Phoenix law firm Jennings, Haug & Cunningham. In layman’s terms, that means the employer is not necessarily immune to prosecution, but it’s unlikely the county attorney “will prosecute a case in which the employer can demonstrate he complied with the system.”

The steps to register with the system are spelled out in a tutorial on the USCIS website, and the current process is much more userfriendly than the original was. “When it was first rolled out, it was quite complex,” recalls Fuentes, explaining the reading level was so high many found it hard to comprehend. That led to problems — which contributed to the early resistance among employers to using it.

An ongoing issue that can still cause frustration is the different versions of a person’s name that may appear on legal forms of identification, Fuentes cautions. “The way the name is stated on [Arizona] State picture ID is not necessarily correct,” she notes, sharing the example of a man whose first name on his Arizona driver’s license was Frankie but whose Social Security card identified him as Franklin.

To avoid the extra paperwork of dealing with the resulting tentative non-confirmation, Fuentes suggests the employer submit the employee’s name as it appears on the person’s

passport, birth certificate, Social Security card or work authorization card, as those issuing agencies are the ones E-Verify references.

E-Verify is not a tool for pre-employment screening. In fact, the program specifically prohibits such use. “It shouldn’t give anyone the sense of security that ‘this is a safe work place because everyone’s been verified,’” says Rudy Troisi, owner of Reliable Background Screening in Phoenix. The system is tied into the Social Security Administration and Department of Homeland Security, and will also check databases for foreigners such as high-level drug cartel members and those suspected of terrorist activity, he explains, but it does not include domestic criminal records.

Employers are also specifically restricted from using E-Verify on previously hired employees. This is to avoid discrimination and protect the employee from wrongful use of E-Verify, Lough explains. However, the system is meant to be used to check the immigration status of a new employee after the employer has made the job offer. Williams suggests businesses run the E-Verify check before actually putting the new hire on the payroll, and seeking appropriate counsel in the small percentage of instances when the names “don’t match up.”

Whether or not the employer uses E-Verify, he or she is still obligated to prepare and maintain a Form I-9 for every employee. If, in processing the new employee, an employer has made an “honest mistake” because the employee presented appropriate identification and authorization documents that turn out to have been forged, it would constitute a defense to the enforcement action but does not afford the same level of protection as the rebuttable presumption of compliance, Lough explains.

Both the employer and the Department of Homeland Security have the right to terminate the MOU upon 30 days written notice. “The employer can simply elect not to use the service and terminate the agreement and incur the risks, should it so choose,” says Lough, noting that no one will know the employer is not using the service unless it is cited for employing unauthorized workers and does not produce the E-Verify confirmation.

HR Choice hrchoice.com Jennings, Haug & Cunningham, LLP jhc-law.com Momentum Specialized Staffing momentumtrans.com Reliable Background Screening reliablebackgroundscreening.com U.S. Citizenship and Immigration Services uscis.gov

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