Arizona Technology Report - May 2011

Arizona Technology Report May – Aug. 2O11 aztechcouncil.org

Arizona Technology Council: The Voice of the Technology Industry

President’s Message

In This Issue Gaining an Edge ... Page 2 Key to a Golden Future ... Page 5 Brand New ... Page 6

Who We Are The Arizona Technology Council is a private, not-for-profit trade association with a mission to CONNECT, REPRESENT, and SUPPORT the state’s expanding technology industry.

Phoenix Office One Renaissance Square 2 N. Central Ave., Suite 750 Phoenix, Arizona 85004 Phone: 602-343-8324 Fax: 602-343-8330 info@aztechcouncil.org

Tucson Office The University of Arizona Science and Technology Park 9040 S. Rita Road, Suite 1150 (near I-10 and Rita Road) Tucson, Arizona 85747 Phone: 520-829-3440 Fax: 520-829-3441 tucson@aztechcouncil.org

As the economy continues to improve, companies are looking for new ways to make the right connections that lead to new business. We have seen this desire at the Arizona Technology Council as the ranks of our members grow.

Simply joining, however, is not enough. We strongly encourage our member companies to take advantage of the opportunities offered to better engage with the Council.

It all starts with getting the right people in an organization to become involved. Companies need to identify those individuals who are most influential and best at implementing new ideas. They should also be asking who among them is active in politics and economic growth, and is most apt to share new information. In short, it means getting a cross-section of team members involved in the Council, not just the president or owner.

After that, it’s a matter of getting those people involved in the appropriate program or at the right event—but preferably not on their own time. Companies should proactively approve time to participate.

Managers should browse the listings of our many events and suggest which seem appropriate to attend to help achieve the company’s goals.

Steven G. Zylstra, Recognizing they likely will meet people from organizations whose President and CEO, relationships could be beneficial, assist them in their scouting. When Arizona Technology Council they return to the office, ask them to present overview reports to appropriate teams.

To help, members of the Council’s Ambassador Committee focus on assimilating new and prospective member companies. They assist individuals in recognizing which events are most likely to be valuable to them. Committee members qualitatively and quantitatively drive attendance at all events. They can get the right audience to the right events Collectively, these efforts will help open new doors. And who will company representatives meet? Our member organizations include Boeing, Honeywell, Apollo Group, iLinc, The Foundation for Public Education, Arizona State University, The University of Arizona, KPMG and The Board Institute. Members include “connectors” from virtually every business discipline across industries.

With more than 140 events annually, participation in 10 committees, and communication tools such as our monthly eNewsletter as well as our magazine, TechConnect, Council staff and I invite you to get involved. Make this the year you and your company get engaged. We believe we have the perfect match. The Council is the place to connect and grow.

Management and Staff Steven G. Zylstra

Leigh Goldstein

President and CEO

Managing Director, Programs & Events

Deborah Zack

Don Rodriguez

Director, Membership Services

Editor, TechConnect

Merry Lake Merrell

Ron Schott

Director, Marketing and Communication

Executive Emeritus

Jamy Battle

Justin Williams

Director, Finance and Administration

Director, Tucson Office

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Don Ruedy Executive Emeritus, Tucson Office

George Land Director, Arizona Arizona Innovation Institute

Kim Kressaty

Joe Tidwell Project Manager, GetSTEM-AZ, and State Director, Project Lead the Way

Phillip Huebner Director, Arizona Science and Engineering Fair

Deputy Director, Arizona Innovation Institute

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Gaining an Edge Council helps in efforts to pass the Arizona Competitiveness Package

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hange can be for the better.

As one of the strongest voices for Arizona’s hightech industry, the Public Policy Committee of the Arizona Technology Council has been a key resource to Gov. Jan Brewer, the Legislature and the Arizona Commerce Authority in defining and supporting components of the Arizona Competitiveness Package that was recently passed and signed into law.

“This is one of the most important pieces of legislation that has ever come our way,” says Steven G. Zylstra, president and CEO of the Arizona Technology Council.

“We’re grateful that the governor and Don Cardon, president and CEO of the Arizona Commerce Authority, have the creativity and courage to work with the business community during this difficult time to do something bold and forward thinking for the state.”

Steve Phillips, chairman of the Arizona Technology Council and chief information officer of Avnet, Inc., adds, “This legislation

The Public Policy Committee of the Arizona Technology Council focuses on issues and initiatives that accelerate technology-related public policy and legislation in Arizona affecting the growth and development of the technology industry. These include technology commercialization and development, workforce development, supply-chain development, and capital formation.

Along with Council professionals, the Committee works with legislators, elected officials and policy makers at all levels of government to educate them on the value and promise of the technology industry.

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Don Cardon, president and CEO of the Arizona Commerce Authority; Gov. Jan Brewer; and Jerry Colangelo, co-chair of the Commerce Authority's Board of Directors

will be especially impactful to the overall business climate in Arizona by improving the state’s job climate and stimulating economic recovery. We cannot afford to continue to have companies invest and grow elsewhere because our business climate remains uncompetitive. The time is right for reform now.”

Like any polished business plan, the Arizona Competitiveness Package has components designed to complement one of another. They are:

Arizona Commerce Authority The Department of Commerce has been replaced by the new Arizona Commerce Authority. With the effect of eliminating waste in government, this new quasi-public state Authority has oversight by a board made up of CEOs and other corporate executives.

reduction will occur in equal increments over a four-year period.

Increased Sales Factor The electable sales factor for multi-state corporations will jump from 80 percent to 100 percent between FY 2014 and FY 2017. The increase is to occur in equal increments over a four-year period. A corporation that conducts business both in-state and out-of-state must apportion its income from business activity based on the ratio of property, payroll, and sales in Arizona compared to the corporation’s property, payroll, and sales everywhere.

R&D Tax Credit Enhancement The credit is increased by 10 percent if qualified expenditures are made through a public or private Arizona university.

Angel Tax Credit/Capital Gains Corporate Income Tax The corporate income tax rate will be reduced from 6.96 percent to below 4.9 percent between FY 2014 and FY 2017. The

The eligibility criteria for a qualified small business increased from $2 million to $10 million in total assets. The capital gains tax is eliminated on income derived from

The Arizona Technology Council is also supporting several bills still in the state Legislature. They are: SB 1452 – supports eLearning best practices SB 1552 – provide sales factor for companies in the services industry SB 1041 – Invest Arizona to facilitate investments in Arizona by business in the near term.

Members of the Arizona Commerce Authority's newly formed Rural Advisory Council

investments in qualified small businesses that have been certified by the Arizona Commerce Authority.

Personal Property Tax Reform Depreciation schedules are accelerated for prospective acquisitions of commercial personal property initially placed on the tax rolls on or after 2012.

Personal Property Exemption The exemption on personal property increases from the current $67,000 in tax year 2010 to $79,000 in tax year 2011 by using the employment cost index rather than the gross domestic product implicit price deflator.

is $30 million a year and $90 million for three years.

Arizona Competes Fund This has also been labeled the “Deal Closing Fund.” To qualify, a company must achieve certain performance measures, average employees’ wages above the county’s average wage, and other requirements similar to the existing Job Training program. The fund will generate dollars for investment in business projects that stimulate and promote industries that provide stable, high-wage jobs. The program will be funded through increases in corporate income tax withholding and capped at $31.5 million annually.

Several bills at the federal level are also being tracked and supported by the Arizona Technology Council’s Public Policy Committee. The bills include: H.R. 4 – repeal of the 1099 requirement for all transactions $600 or more H.R. 942 – designed to make the federal R&D tax credit for business permanent

Board member Vicki Panhuise, vice president, U.S. Defense Customers, Honeywell Aerospace

Commercial Property The commercial property assessment ratio is reduced to 18 percent. An increase in the homeowners rebate will offset the change in the assessment ratio.

Job Training Program There is reauthorization of the existing job training program, a job-specific reimbursable grant program that provides training plans for employers creating new jobs or increasing the skill and wage levels of current employees.

Quality Job Tax Credit The tax credit replaces Arizona’s expiring enterprise zone program with a new quality job income tax credit. Each eligible job qualifies for a $3,000/year credit for three years, with a cap of 400 jobs per employer each year. The total program cap

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Gov. Jan Brewer signing HB2001, which allowed creation of the Arizona Commerce Authority.

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Getting Together

getSTEM-az offers chance for educators and businesses to unite getSTEM™-az, an innovative and interactive web portal for Arizona educators and businesses, has been launched to build relationships and collaborations that match STEM (Science Technology, Engineering and Math) education needs with STEM businesses resources.

“Arizona educators are working to prepare students for careers rich in math, technology, science and engineering skills,” said Steven G. Zylstra, president and CEO of Arizona Technology

Council. “The getSTEM-az web portal connects teachers with interactive and exciting learning resources they need to provide the rigorous and relevant learning that will prepare students for success.”

The Council partnered with the Arizona Commerce Authority to create getSTEM-az as a component of a statewide initiative to promote rigorous and relevant education opportunities in STEMrelated fields. The initiative is funded by a combination of grants awarded by the Arizona Commerce Authority and Innovation Frontier Arizona –WIRED along with contributions from several technology companies, including Avtex, IBM, Microsoft, Raytheon and Thomson Reuters. “getSTEM-az is an excellent example of the private sector and public sector working in harmony to achieve real results for Arizona students,” said Don Cardon, president and CEO of the Arizona Commerce Authority. “Arizona’s high tech businesses are stepping up to the plate to aid schools in delivering a world class education.” getSTEM-az offers a convenient online location for educators to request resources or opportunities that clearly connect their STEM-related coursework to college or career possibilities. At the same time, it provides businesses with an easy way to support and collaborate with local educators to help prepare tomorrow’s workforce to succeed in STEM-related fields.

The variety of tools, resources, links, current news and events related to STEM education can be found at www.getstem-az.com.

They’re #1 Science Bowl winners head to national competition When it comes to knowing about science, Team #1 from BASIS Scottsdale truly is #1.

They were the winners of the fifth annual Arizona Middle School Science Bowl competition organized annually by members of the Arizona Technology Council’s Workforce Development Committee.

Sanctioned by the Department of Energy’s National Science Bowl®, the event was sponsored in conjunction with IT consulting services leader Solugenix.

The winning team was awarded an all-expense paid trip to compete at the National Science Bowl® competition to be held April 28 – May 2 in Washington, D.C., and a mission experience on the simulator

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at the Challenger Center for Space Science Education in Alexandria, Va. Seventeen teams of up to five students in grades 6 through 8 from throughout the state competed Feb. 26 at Arizona State University’s Tempe campus. Coming in second was the team from the Chandler Preparatory Academy while the spot was claimed by BASIS Scottsdale Team #2.

“The overall focus of this event is to get kids interested in science and math by making it fun and giving them the proper motivation, preparation, and encouragement,” said Steven G. Zylstra, president and CEO, of the Arizona Technology Council. “We congratulate

all of the students who participate in this annual event and look forward to cheering on the winning team at the national competition.”

“This event is a prime opportunity to help students reach their highest potential,” said Shashi Jasthi, president and CEO of Solugenix.

The intense and fast-paced statewide academic competition for middle school students followed a “Jeopardy” game show style to test participants’ knowledge in all areas of science and math. It consisted of several question and answer matches in a round robin and double elimination tournament.

Key to a Golden Future Xi'an Terra Cotta Warriors Museum

Check Out China On the heels of a successful inaugural trade delegation to China last year, the Arizona Technology Council has teamed with the Arizona Chamber of Commerce and Industry to provide another exploratory mission to China for Arizona business leaders.

The 2011 China trade delegation will depart Phoenix on Sept. 14, traveling to Shanghai, Chengdu, Hong Kong, Shenzhen and Macau before returning Sept. 24. This trip will include meetings with government and business leaders as well as an in-depth exploration of Chinese cultural. Topics to be covered in China include manufacturing, technology, academia, law and a general overview of international business.

This tour is open to Arizona Technology Council and Arizona Chamber of Commerce and Industry members as well as non-members.

The tour is operated by China Direct Consulting Group in partnership with China International Travel Services.

For more details, contact Merry Lake Merrell, the Council’s director of marketing and communication, at 480-467-8251 or mmerrell@aztechcouncil.org.

Program offers help to gain access to foreign markets Companies looking for ways to crack into the emerging markets of nations like China and India can take advantage of a key to open doors. A Gold Key, in fact.

The U.S. Commercial Service’s Gold Key Service is a matchmaker for businesses looking for direction to make the right connection. The Arizona Technology Council has partnered with the U.S. Commercial Service’s Service’s Arizona U.S. Export Assistance Center on this effort in the state.

“The large, emerging BRIC (Brazil, Russia, India and China) markets represent major 21st century growth opportunities,” said Eric Nielsen, director of the Arizona U.S. Export Assistance Center. “Arizona technology companies have a large stake in understanding how to position themselves to take advantage of that potential.”

The program is for U.S. exporters whose products or services contain a majority U.S. content (at least 51 percent).

“The Gold Key provides direct access to potential agents, distributors, representatives and end users for made-in Arizona products and services, Nielsen said.

A participant in the program goes through a series of steps to accomplish their goals. It starts with a meeting with local Commercial Service trade specialist, often leading to a conference call with another specialist in the desired country who also will be working on the project. There is an evaluation to determine parameters and delivery times plus a questionnaire to learn about the type of partner being sought.

To get the wheels turning overseas, the overseas specialist will contact companies that meet all or most of the criteria set by the client to determine their level of interest and whether they would be a suitable match.

Appointments are set up with such people as pre-screened sales representatives, agents or distributors, and licensing partners. (Six weeks advance scheduling is required.) A profile on each potential company or partner will be supplied as is relevant market information.

The participant then visits the cities of opportunity for meeting. For example, the cities targeted in India are New Delhi, Mumbai, Chennai, Calcutta, Bangalore, Ahmedabad, and Hyderabad. The program calls for one day in each city. Any request for additional days will be considered subject to availability of resources The specialist will attend those meetings with the participant. These are followed by post-meeting debriefings to develop appropriate follow-up strategies. There is even help getting a hotel and taking care of other logistics.

For more information, go to www.export.gov or www.buyusa.gov/arizona.

Fee Schedule Although supported by the federal government, the Gold Key Service is a feebased service. The rates are: SME company: $700. Additional day of appointments for SME company: $300 Large company: $2,300. Additional day of appointments for large company: $1,000 SME New-to-Export companies using service for the first time: $350

Tang dynasty show in Xi'an

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*A small or medium-size enterprise (SME) is defined as a firm with 500 or fewer employees or self-certified as a small business under SBA regulations. A large company is defined as a firm with more than 500 employees. Subsidiaries will be classified based on the size of the parent company.

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Brand New

Council getting new energy for its brand The most important asset an organization has is its reputation, its brand.

Refreshing the brand becomes a compelling rallying point and sends the signal of vitality. Creative Engine of Tempe was tasked with energizing the Arizona Technology Council’s brand, giving members a sense of community and providing a seal of approval and distinctive values.

Scottsdale-based Miss Details Design will lead its implementation. Besides design of a new logo, they will be involved in creative work ranging from designing new letterhead for the Council to a style guide that reinforces the brand traits identified

by Creative Engine.

The first step in the brand plan was to identify the Council’s value proposition: What does it offer to existing and prospective members of relevant value?

The starting point was interviews designed to recognize market behaviors, wants, needs, perceptions and expectations.

Identifying these traits provides key insights, stimuli to the next process phase of brand development. In essence, the consumers—in this case, the members—are literally providing stimulus to the brand.

The second step of the brand renovation was to align core competencies, core essence, and assets and infrastructure. If all three are not working together, chances are the organization will not succeed. Core competencies are based upon four distinct factors: knowledge, experience, resources and people. Core essence is who you really are as a company or brand, what your brand stands for in the hearts and minds, and the promises your brand makes to consumers.

The third step was to develop a positioning (promise) statement that’s a thought driver in the Council’s marketing campaign development and a destination compass for the compelling selling proposition: The Arizona Technology Council is a premier trade association representing science and technology companies of all size and stages. At the Council, leaders, managers, employees and visionaries from

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diverse backgrounds meet, share ideas, ask questions and make a real difference to their business and to the industry. These interactions contribute to the Council’s culture of growing member businesses and transforming technology in Arizona.

The positioning line was crafted to reinforce the brand positioning statement:

A Place to Connect and Grow.

This new position line will be closely aligned with the new AZTC logo identity. The brand position line will literally accompany all communications, reinforcing the Council’s distinction, depth, energy, look and feel. Watch for the results to unfold in the months ahead.

Top of the Class

School awards doctorate to Council leader Just call him “doctor.”

The University of Advancing Technology’s Board of Directors has awarded an honorary doctorate to Steven G. Zylstra, president and CEO of the Arizona Technology Council.

The degree will be presented at the school’s April 29 commencement ceremonies at the Mesa Arts Theatre. Also receiving an honorary degree will be Sally Downey, superintendent of East Valley Institute of Technology.

“Both Sally and Steve have contributed to our technology community here in Arizona. Through her enterprising and ambitious leadership at EVIT, and his perspicacious direction of Arizona Technology Council, I am personally thankful to have Sally and Steve as our honorees,” says Jason Pistillo, president of UAT. “I love these guys.”

UAT is a private technology university dedicated to advancing society by cultivating thinking innovators Zylstra serves on a number of different boards, including the Arizona Aerospace Institute Advisory Committee. He is also the co-founder and member of the Governors’ Arizona Science and Technology Council. Zylstra graduated from Western Michigan University with a bachelor of science degree in automotive engineering technology.

“When I received word that UAT was presenting me with an honorary doctorate degree, I was humbled, honored and excited,” Zylstra says. “I have great admiration for the uniqueness of UAT and its reputation as a respected academic institution that is focused on producing the next generation of technology innovators.”

Best of the Best

CIO of the Year to be named at annual Business & IT Summit

All photos by Mark Goldstein

Steve Phillips, chairman of the Arizona Technology Council Board of Directors, speaks at a recent IT expo

Whether you are a business owner looking to improve your company’s productivity, an IT manager wanting to expand your knowledge, or a technology product or service provider looking to grow your sales, help is on the way.

The Arizona Technology Council’s fifth annual Business & IT Summit will be held May 26 at the Hilton Scottsdale Resort & Villas Grand Ballroom, 6333 N. Scottsdale Road, Scottsdale.

Systems performance, cost efficiencies, impact of green, security, strategic growth, and human capital. These are all topics that impact all the technology heroes who keep systems running smoothly and business advancing in a tough economy and the competitive global landscape. They will be addressed at the Summit.

In addition to the breakout sessions, some of the nation’s most innovative companies will be exhibiting their products and talking about their services. There will be plenty of time for one-on-one networking, too.

A highlight of the summit will be the annual CIO of the Year awards luncheon to honor individual technology executives from industry, nonprofit, education and government. Nominees, including chief

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information officers or those in equivalent IT leadership positions, will be recognized for their innovation and creativity in planning and deploying their enterprise systems, future IT goals, management philosophy and service to the industry and community.

The categories are: Small – For organizations with fewer than 50 employees Medium – For organizations between 51 and 250 employees Large – For organizations of 251 or more employees Small Non-Profit/Government – fewer than 75 employees Large Non-Profit/Government – 75 or more employees Education – technology executive within an accredited higher education institution For more information or to reserve your Summit exhibitor booth sponsorship, contact Leigh Goldstein, the Council’s managing director of programs and events, at lgoldstein@aztechcouncil.org.

Event Agenda 8:00a: Summit doors open/ registration/sponsor exhibits 8:30a: Breakout session #1 9:45a: Break/sponsor exhibits 10:00a: Breakout session #2 11:45a: Break/sponsor exhibits Noon: Keynote speaker/CIO of the Year awards luncheon 1:30p: Summit ends

Attendee Cost Arizona Technology Council member: $40 Non-Council member: $55 Council member reserved table of 10: $350 Non- Council member reserved table of 10: $500

A participant at a recent IT expo

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“Being a sponsor of the Arizona Technology Council has been very helpful in getting our company brand recognition.

The staff has been very supportive and helped us use our sponsorship to promote Miss Details Design, educate our staff, and connect with new vendors and clients. I highly recommend getting involved.”

—Tanya Gagnon Visionary Designer Miss Details Design

“Our involvement with and sponsorship of Arizona Technology Council events has been an immensely important part of our business community outreach and giving back. We love being involved with the AZTC and highly recommend it.”

—Sheila Kloefkorn President KEO Marketing, Inc.

“Our sponsorship of the GCOI has provided us not only recognition as a major player in the VoIP markets in Arizona but has generated many opportunities for great partnerships along with leads for future business. We are very excited to be a sponsor for the 2011 GCOI!” —Debi Caron Partner | Director, Marketing & Business Development Trans-West Network Solutions

Strategic Partners

Each sponsor enters into an agreement that details what each party can expect. For the sponsor, it is combination of services designed to increase the company’s profile.

For the Council, the support helps maintain its programs and operations. The most popular sponsorships are the Platinum and Visionary.

There also are sponsorships for specific events. The Council hosts many events throughout the year, ranging from knowledge-sharing round tables to informational workshops to high-end

keynote speaker series. Some of those events are: Governor’s Celebration of Innovation (GCOI) CEO Retreat in Sedona Council Connect Series Critical Facilities Round Table Series Keynote Speaker Series Partnering Conference

Sponsors help the Council fulfill its mission As with any non-profit, the Arizona Technology Council relies on sponsorships to support its mission. But as you can tell from these comments, there is noteworthy ROI for the Council’s sponsors.

The four types of Council sponsors and their annual levels of investment are: Premier: $50,000 Platinum: $20,000 Visionary: $7,500 Contributing: $4,000

CONNECT

For details about how to become a sponsor, go www.aztechcouncil.org or call 602-343-8324.

REPRESENT

SUPPORT

www.aztechcouncil.org The Arizona Technology Council is a private, not-for-profit trade association with a mission to CONNECT, REPRESENT, and SUPPORT the state’s expanding technology industry.

Interested in membership?

Contact membership@aztechcouncil.org for more information today.

One Renaissance Square | 2 North Central Avenue, Suite 750 | Phoenix, Arizona 85004 Phone: 602-343-8324

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