In Business Magazine - August 2012

AUG. 2012

Roundtable: The Life, Death & Rebirth of America’s Global Leadership

How Are Arizona Businesses Getting a Piece of It?

Power Lunch By the Numbers Business Calendar

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This Issue National Association of Women Business Owners

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august 2012

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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.

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B E C O M E A C O R P O RATE PARTN E R AN D J O I N TH E S E 5 ARTS S U P P O RTE R S:

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GLOBAL ECONOMY

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AUG. 2012

IN BUSINESS MAGAZINE

Contents

Roundtable: The Life, Death & Rebirth of America’s Global Leadership

august 2012

How Are Arizona Businesses Getting a Piece of It? AUGUST 2012 • inbusinessmag.com

Today’s Global Economy: How Are Arizona Businesses Getting a Piece of It?

Power Lunch By the Numbers Business Calendar

This Issue National Association of Women Business Owners

Arizona has been building its position as a player on the international stage. Don Rodriguez looks at where we’ve come from and talks with industry experts about where opportunities continue to expand.

Departments

Features

26

Rx: When a Website Needs Surgery

32 How to Set Owner Compensation

Entrepreneurs must get this right from the start or face pain and suffering later. Greg Crabtree explains why and how to include owner compensation in a company’s budget.

12 Briefs

Arizona is ranked 25th in the nation for highest executive pay. How does top pay break down by region and occupation?

Strategic planning sets the course for an organization’s key choices. Samantha Howland discusses how to approach it as an ongoing process, rather than a dull, drab annual exercise.

18 Trickle Up

35 What Manufacturing Means to the Valley Economy

Manufacturing is a core industry supporting many areas of the Valley’s economy. Industry and economic development leaders share with RaeAnne Marsh challenges facing this sector and strategies for its growth.

Celebrati

ng more

Women Business Owners

38

Noted business and community leaders Anna Flaaten; Dennis Hoffman, Ph.D.; and Glenn Williamson respond to IBM’s burning business question of the month.

16 By the Numbers

34 Strategic Planning Vitalized

41 National Association of

10 Feedback

“Legally Speaking,” “Job Find,” “Entrepreneurs Helping Entrepreneurs,” “Dot-com Bubble to Burst?, “Building Profits in Pampering,” “YouTube as Consultant to Business?, “Igniting Phoenix,” “Business Model Innovates Insurance Sales” and “Consulting Concept Supports U.S. Economy”

34

Special Section

38 Assets

Eric Nielsen, director of U.S. Commercial Service — Arizona, introduces the “Global Economy” issue.

Joe Thomas discusses common obstacles to building a successful website, and suggests effective strategies for working with website professionals.

32

9 Guest Editor

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Lynda Bishop President , NAWBO

Phoenix

View from the top looks at how Matt Widdows creates technology innovations to revolutionize real estate sales practices.

27 Books

New releases offer views on how, why and even if social media should be part of a business’s practices.

• nawbo

phx.org

28 Nonprofit

Epilepsy Foundation of Arizona Hon Kachina Council

All-new Cadillac XTS Plus: Software programs for day-to-day accounting

39 Power Lunch

At WM Sacks, the business success of “the art of sandwichery” makes for tasty lunch.

Plus: “Go Ethnic and Taste Broader Horizons”

50

50 Roundtable

“The Life, Death & Rebirth of America’s Global Leadership” On The Agenda

29 Spotlight

Arizona Chamber of Commerce & Industry — Environmental and Sustainability Summit Arizona Small Business Association — Human Resources Update Seminar

30 Calendar

Business events throughout the Valley

1

O NEWS

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A u g u s t 2012

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august 2012 • Vol. 3, No. 8

Publisher Rick McCartney Editor RaeAnne Marsh

Art Director Benjamin Little Contributing Writers Greg Crabtree Samantha Howland Mike Hunter Mona Pearl Don Rodriguez Alison Stanton Joe Thomas

Photographer-at-large Dan Vermillion

Advertising

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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.

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Vol. 3, No. 8. 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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Eric Nielsen, Director, U.S. Commercial Service — Arizona

Guest Editor

The World Knows Arizona

As director of the U.S. Commercial Service in Arizona, Eric Nielsen is responsible for operations of the U.S. Export Assistance Center in Phoenix, Scottsdale and Tucson. In fiscal year 2010, the Arizona USEAC helped more than 100 different customers generate 263 export transactions to 50-plus countries, with total sales valued at approximately $51 million. Nielsen manages a team of four international trade specialists and coordinates partnerships with a wide variety of economic development organizations.

There was a time when businesspeople from Arizona struggled to become known on the world market. Doing business with Mexico and Canada was common trade in Arizona, but doing business with China, Brazil and others of today’s best-known trade hot spots was nearly unthinkable for even the largest companies located here.

However, with 95 percent of global consumers living outside of the U.S. and millions of households entering the middle class each year in these emerging markets, Arizona businesses are increasingly reaching beyond North America. The Internet, improved transportation options and the array of U.S. government export and financing assistance available has greatly streamlined the export process for small and medium-sized enterprises. In 2011, Arizona companies shipped $17.8 billion in merchandise exports to world destinations, a 14-percent increase over the previous year. But there is still much more room to grow, especially in areas in which Arizona has a competitive edge, such as IT, aerospace, healthcare technology and tourism.

Offices of the U.S. Commercial Service in Arizona — in Phoenix, Scottsdale and Tucson — serve as a gateway to global markets for hundreds of Arizona businesses each year. Worldwide, the CS has offices in 108 U.S. cities and more than 70 countries, providing a seamless network of on-the-ground assistance, which includes everything from developing a business plan to finding the right business partner or distribution channel to financing. We also work closely with key local partners, including the Arizona Commerce Authority and the U.S. Small Business Administration, who together make export-related business development funds available through the State Trade Export Promotion grant.

Today, international trade has become something businesspeople are not only familiar with as a part of Arizona business but see as a way to grow business here. Don Rodriguez, in this issue’s cover story “Today’s Global Economy: How Are Arizona Businesses Getting a Piece of It?,” looks at Arizona’s strengthened stature in global commerce and explores factors and businesses that have contributed to this growth as well as avenues of opportunity for continued growth.

In an article that overlaps the cover story in some aspects, In Business Magazine editor RaeAnne Marsh’s “Sector” feature on manufacturing examines strengths and challenges that impact the Valley’s, and the state’s, manufacturing industry — a business sector at the core of other economic growth.

The value of strategic plans as well as tips to make them flexible and effective, and a feature that addresses difficulties businesses face in developing a compelling website, are among the other features in this issue that business owners will see as helpful in building their business. Greg Crabtree gives business owners a possible rude awakening in his article on the need for them to set a value to properly remunerate themselves as they do their employees. Mona Pearl challenges business leaders to recognize a changed world economy and reestablish U.S. business as a global leader.

With its focus on building business for our community, In Business Magazine offers relevant and timely information for entrepreneurs and corporate leaders. I hope you will enjoy this “Global Economy” issue of In Business Magazine.

Sincerely,

Eric Nielsen, Director U.S. Commercial Service — Arizona

Making Arizona a World Trade Partner One would think Arizona would be top of mind as we move toward a more global economy. It is not — yet — and it seems there is an awful lot of work ahead of us. However, over the past 20 years, the strides have been great, the successes many and the ramifications prosperous. We thank Eric Nielsen for being our Guest Editor for this issue. He is invested in this work for Arizona and, as is evident in his letter, Don Rodriguez’s cover story and RaeAnne

inbusine ssmag.com

Marsh’s “Sector” story, groups are working well together to boost our place on the world stage.

Without a port or major rail, Arizona has found its place through technology, innovation and good ol’ fashioned hard work. It is paying off for businesses of all sizes that have been or are just beginning to play globally. Let’s continue this push to make Arizona a prosperous trade partner.

—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

a u g u s t 2012

9

Feedback

Valley Leaders Sound Off

Executives Answer

In light of the economic upheaval in recent years, what changes or successes have you seen in global commerce as it relates to Arizona businesses?

Anna Flaaten Senior International Trade Specialist U.S. Commercial Service Arizona Sector: Government Arizona exporters are seeing a lot of movement in worldwide export sales. Our data shows Arizona merchandise exports increased 12 percent in 2011 compared to 2010, growing from $15.6 billion to $17.5 billion. Our office has also seen an uptick in the number of smaller firms and entrepreneurs looking to make new sales abroad, helping to advance this Administration’s National Export Initiative that is on pace to double U.S. exports by the end of 2014. Eighty-five percent of world economic growth over the next five years will take place outside of the United States. As the U.S. economy builds momentum, we must continue to equip businesses in Arizona with all the necessary tools to increase exports that support thousands of high-paying jobs here in the Valley.

Arizona’s 2011 merchandise export sales increased to many top destinations, including Japan (up 34 percent), Malaysia (21 percent), the United Kingdom (20 percent), Germany (16 percent) and Mexico (14 percent). Key merchandise export categories include computer and electronic products, transportation equipment, machinery manufactures, agricultural products, and minerals and ores.

U.S. Commercial Service Arizona trade.gov/cs/states/az.asp

Anna Flaaten is a senior international trade specialist with the U.S. Commercial Service, part of the U.S. Department of Commerce. Based in Scottsdale, Ariz., she is part of a network of local field offices located throughout the U.S. and the world that assist U.S. companies to export their products and services overseas. She also serves on the board of the Organization for Women in International Trade’s local Phoenix chapter.

Glenn Williamson CEO Nest Ventures, L.L.C. Sector: Financial In life, “change” is one of the few constants, and in this case Arizona’s housing problems have become part of its reinvention and possible future success. By hitting the bottom so hard, we also hit the international media and gave huge exposure globally to the cost advantage for foreign direct investment opportunities in Arizona. (All you have to do is look at the Canadian market, who invested some $6 billion in the state in 2011.)

The recent and ongoing recession has also forced Arizona’s companies

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Dennis Hoffman, Ph.D. Director L. William Seidman Research Institute at Arizona State University’s W. P. Carey School of Business Sector: Education Before the Great Recession, when 50,000 to 100,000 people moved here from other parts of the country each year, we thought the growth would continue forever. Much of the business was based on population momentum, and we didn’t necessarily need a global strategy. However, as in-migration slowed to a trickle, it became more obvious we should focus on bringing in businesses, such as Intel, that produce products for export to anywhere on the planet.

This drives dollars into the pockets of Arizona workers.

The governor and Arizona Commerce Authority have recognized this. The governor’s recent trip to Europe is a manifestation of the new imperative to more prominently position Arizona in the global economy. She is correct to focus on Arizona’s strengths in IT, electronics manufacturing and, potentially, solar industries. These are global businesses that come to Arizona to employ our productive workers, not just to sell products to a growing local population. Also, showcasing our research universities, our productive work force and our pro-business tax and regulatory environment is the right strategy.

W. P. Carey School of Business at Arizona State University wpcarey.asu.edu

Professor Dennis L. Hoffman, director of the L. William Seidman Research Institute, served as a visiting research scholar at the Federal Reserve Bank of St. Louis in 1996 and was named the Arizona Professor of the Year by the Carnegie Foundation in 1997.

His sponsored project efforts include construction and maintenance of the tax-revenue forecasting model used by the Executive Budget Office of the State of Arizona since 1982.

to become more efficient and therefore globally competitive, and, with a shrinking domestic market, has made them to look to a global export market for opportunities. Considering only 1 percent of U.S. companies export, this is a good trend to encourage because it will bring more outside capital into Arizona.

Bottom line, the recession has made Arizona relevant cost-wise, and the recession has made Arizona companies more efficient, and the recession has forced Arizona companies to augment their domestic sales by selling internationally.

Nest Ventures, L.L.C. nestventures.com

Glenn Williamson is CEO of Nest Ventures, L.L.C., a private equity firm with offices in Montreal and Phoenix, and is founder and CEO of the Canada Arizona Business Council, a private sector group sanctioned by the Canadian Government and the State of Arizona to work on increasing bilateral trade and foreign direct investment between Canada and Arizona. Other responsibilities include executive chairman of the board and CFO of aerospace firm Kinetx and chairman of water utility EPCOR Water USA.

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Briefs

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Bytes

Legally Speaking FordHarrison, a national labor and

employment law firm with offices in Phoenix, has launched its KnowledgeCenter, which is a virtual library offering blogs, publications, alerts, news and training materials. SourceBook is a subscription-based service that provides information on state and local employment laws. fordharrison.com

Job Find Most are not aware of the Arizona Workforce Connections jobs website.

Azjobconnection.gov is a great resource for job seekers and employers to post and look at job listings and get useful information on building resumes, job fairs, training opportunities and more. azjobconnection.gov

Dot-com Bubble to Burst?

Does the sale of Digg.com at $500k mean we are in for another dot-com bubble bursting? Experts say no, but for a social-news website once valued at $160 million to have such a dismal sale and lower Facebook traffic and generate speculation by many that the “trend” is up on Twitter may be an indication some air is letting out of the bubble …

Building Profits in Pampering

Having survived the recession that hit the economy only a couple of years into their entrepreneurial endeavor, Chandler-based Fuchsia co-owners Lisa Vukovich and Erin Owens recently moved their day spa into double the space.

They attribute part of their success through the downturn to providing the pampering of a spa at an affordable price. Says Vukovich, “Clients who were used to going to a resort spa started coming to us.”

The other big factor was developing their business around a membership base, which provided guaranteed revenue. “People stayed, going into the recession,” Vukovich says. Recognizing the importance of customer service, she and Owens focused on establishing an atmosphere of friendliness. Says Vukovich, “We’re like a family.

We know what’s going on in our members’ lives.”

Fuchsia was the first day spa in Arizona to offer massage facials such as microdermabrasion, according to Vukovich. She and Owens added a nail bar and pedicures to their spa services as the recession proceeded, making more productive use of space they’d initially maintained as a boutique. “It was an amazing bump in revenue,” Vukovich says. Another effective response to the recession was adding service enhancements that both raised the ticket price and increased client satisfaction.

The business brings Vukovich full-circle, as she had put herself through college as a cosmetologist. She and Owens self-financed their endeavor, leaving jobs in corporate America to open Fuchsia in November 2006 in a 2,000-square-foot space. They recently expanded to a 4,000-square-foot location. Franchising is the route they are considering now for further expansion.

—RaeAnne Marsh Fuchsia fuchsiaspa.com

Visualize This Entrepreneurs Helping Entrepreneurs Seeing is Believing connecting to help start-ups with business profiles, events, barter opportunities, advertising and local links to blogs, etc., all helping to grow business locally. It is free to join this website by registering, creating a profile and setting up weekly feeds. GrowAZ is about ideas, advice, community, resources, jobs, news, mutual support and marketplace awareness for small business. growaz.org

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YouTube as Consultant to Business?

Simply go to

YouTube and type in a subject and learn more, get advice or refine an idea. Is this the new “consultant” portal? youtube.com

Igniting Phoenix

You’ve heard of them. Ignite Phoenix is a creative

gathering of five-minute presentations on ideas, businesses and really anything that other people will find interesting.

Submissions are now open for the Oct. 26, 2012, event at the Scottsdale Center for the Performing arts. ignitephoenix.com

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Photo: Fuchsia (top)

This is a small-business online marketplace for the start-up organization and businesses

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Briefs

Quick and to the Point

Business Model Innovates Insurance Sales

Exploding out of its home base of Jacksonville, Fla., Brightway Insurance is bringing its new model of insurance brokerage and franchise opportunity to Arizona. It plans to follow its recent opening of one store in Scottsdale with 52-68 stores throughout the state in the next few years.

Calling Brightway an “insurance retailer,” David Miller, co-founder and CEO, explains that, being able to offer different carriers for different needs, the focus is on providing customers the widest choice in the convenience of a single location. “They get the best value possible because Brightway has all the options in one place.” With greater scale than a singleshop independent agent, Brightway can focus on helping customers “identify the coverage they need, and what they don’t need.” Drawing a parallel to the emergence of fast food as a category within the food industry, Miller says, “We represent a new sub-industry.”

Brightway has grown from one store, three employees and 2,000 customer policies in 2003 to its current 100 stores, 500 associates and 130,000 policies in five states, with a success rate among its franchisees of 94 percent.

Arizona is one of 17 states in which Brightway has plans to expand. Population density was an important consideration in determining where to grow the company, according to Miller — who characterizes Arizona as a growth area that more people are moving to than leaving from — because “where people are able to interact, talk to each other [about their experience], it’s better for us.” Brightway plans to open four stores in the Scottsdale area, with similar concentrations in other population centers such as Phoenix and Tucson.

The model is also designed to be a convenient entry into business for entrepreneurs. As a franchisor, Brightway offers its franchisees broad support in all aspects of operations: managing the service, accounting, mail, marketing, brand development and carrier relationships. “All the franchisees have to do is build relationships with customers,” Miller says. Brightway does not require franchisees to have any past insurance experience, but they must earn an insurance agent license in their state before they can open for business.

—RaeAnne Marsh Brightway Insurance brightwayinsurance.com

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Consulting Concept Supports U.S. Economy

The trend of businesses outsourcing IT support to overseas companies not only reduces employment opportunities domestically but depletes our pool of knowledgeable workers from which innovation and future advances will come. Businesses’ gain, of course, is saving money, but the talent drain is an issue that has been recognized by economists.

Amerishore, an IT service provider that is a wholly owned subsidiary of Neudesic — a Microsoft National Systems Integrator — aims to address both concerns. Using teams of Amerishore student associates working under the management and direction of a full-time head consultant keeps cost down for the business while providing the students a foot in the door toward a job. Says Eric Huckabay, Amerishore director of operations, “Amerishore student associates are provided an amazing experience of the ‘real world’ work environment while coordinating hand in hand with highly talented, Microsoftcertified Neudesic consultants. Students also receive the opportunity to prove themselves to Amerishore’s clients to increase the likelihood of attaining a full-time position within that organization upon their graduation.”

It’s also a strong recruitment tool for the client company, which can get a sense of the student’s “fit” before offering a full-time position, he adds.

Amerishore has been building its presence in the Phoenix area since February of this year, working with clients in a variety of business sectors. “Before Neudesic creates a fulltime Amerishore student associate staff, the organization ensures the Neudesic business in the targeted market is substantially strong and the expected growth is significant enough to support a full-time Amerishore staff,” explains Huckabay, noting, “Phoenix is Neudesic’s strongest, highest-revenue-generating market.”

A full-time Amerishore staff is 15 students; currently, there are 10 Amerishore student associates working on Phoenix projects.

“We are interested in creating relationships with various universities,” Huckabay says, explaining Amerishore’s management team targets IT college students beginning their junior year, and the students remain in the program about one-and-a-half years.

“Many entry-level IT positions are now awarded overseas to reduce costs, leaving the new generations of IT students stumbling at the starting point of their careers,” says Huckabay. “Our team champions Phoenix businesses seeking low-risk, high-return IT consulting services and an opportunity to better support the U.S. economy.”

—RaeAnne Marsh Amerishore amerishore.com

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15

By the numbers

Metrics & Measurements

Pay at the Top: Executive Pay Cut Down to Size Arizona is ranked 25th in the nation for highest executive pay, according to U.S. Department of Labor statistics, reported in May of 2011. That means we are middle of the road. The average pay for an Arizona chief executive is $172,279. That is $82.82 per hour.

Delaware is first among the states in executive pay at $218,900 and $105.24 per hour while Montana is at the bottom at $104,800 average annual pay and $50.39 per hour.

While these are averages, the real newsmaker is the top pay among the chief executives. These ranges in Arizona can be between $80 million and just under $800,000.

Some are salaries alone and others combine pay, stock options and benefits to round out the newsworthy numbers. In Arizona, Richard Adkerson, president and chief executive officer of Freeport-McMoRan Copper & Gold, Inc. sits at the top with a nearly $82-million package in 2011 — an all-time record pay day in Arizona.

Options and stock awards can mean big money for these tycoons of industry; for Adkerson, options and stock awards represented the majority of his 2011 remuneration, at nearly

Key Indicators

$69 million. Benefits account for only 2 percent of their overall pay, so it appears that getting a piece of the company is where these top executives are really making out.

Top pay figures make attention-grabbing headlines as the gap between executive pay and employees’ pay is larger than ever before.

According to a study done by the AFL-CIO, which looked at average pay of CEOs of the S&P 500 companies in 2010, these CEOs get an average of 380 times the amount of an average worker’s income. Such a gap is often shrugged off by major corporations citing performance and a company’s profitability with such a leader at the helm. Although average CEO compensation in Arizona declined in 2011 to $1.33 million from $1.54 million in 2010 for the first time after three consecutive years of increase, the union federation AFL-CIO cites studies to back its contention that all employees create value and that compensation packages for CEOs that are more in line with employee pay improves morale and product quality and lessens employee turnover.

—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 (Arizona) Unemployment (June 2012)

Occupation CEO Lawyer Computer Systems Analyst Registered Nurse

Arizona

U.S.

$172,270

$176,550

$124,220

$130,490

$74,740

$82,320

$72,340

$69,110

YOY % Change

8.2%

-0.48%

1,726.3

2.66

No. of Housing Permits (May 2012)

1,428

54.69

Consumer Confidence* (Q2 2012 to date) (Arizona)

68.6

24.34

Average Hourly Earnings (May 2012)

$23

1.96

Job Growth (in thousands) (June 2012)

Eller Business Research

Retail Sales (Arizona) Retail Sales (in thousands)

May 2012

June 2012

Total Sales

$6,348,013

$6,753,385

6.99%

6.63%

Retail

$3,722,557

$4,044,640

Food

$1,042,109

$1,045,934

Restaurants & Bars

$839,613

$904,544

Gasoline

$743,734

$758,267

Contracting

$709,002

$700,947

Change Y0Y

Comparative Pay Rates Average Pay in Certain Occupations*

Number

Eller Business Research

Top 5 Pay by Occupation in Arizona Rank

Occupation

Commercial: Office***

Annual Pay

1

ObGyn

$225,370

2

Internist, General

$192,550

3

Dentist

$183,330

4

Real Estate

CEO

Q2 2012

Vacancy Rate

28.0%

Net Absorption (in SF)

178,331

260,444

Rental Rates (Class A)

$23.41

$24.43

Commercial: Indust.*** Vacancy Rate

$172,270

Q2 2011

27.8%

Net Absorption (in SF)

Q2 2012

Q2 2011

11.8%

13.7%

483,974

772,613

$0.43†

$0.51†

June 2012

June 2011

Interior Designer

$53,410

$52,810

Social Worker

$52,480

$54,220

Firefighter

$44,010

$47,720

Average Worker

$43,670

$45,230

Delaware

$105.24

$218,900

Elementary School Teacher

Total Median Sale Price

$42,500

$55,270

Connecticut

$101.19

$210,480

New Build Sales Volume

758

540

New Median Sale Price

$229,928

$223,250

Construction Laborer Food-Service

$30,430 $21,990

*Listed in order of Arizona pay

$34,170 $21,430

5

Family Physician

$171,090

Rental Rates (General Industrial)

Residential:

Top 5 CEO Pay by State

Total Sales Volume

California

$96.65

$201,030

North Carolina

$95.52

$198,690

Oregon

$95.11

$197,840

U.S. Bureau of Labor Statistics, May 2011 Occupational Employment and Wage Estimates

Resale Sales Volume Resale Median Sale Price

8,257

9,432

$155,000

$124,000

7,499

8,892

$146,000

$118,700

* Rocky Mountain Poll ** Consumer Price Index refers to the increase or decrease of certain consumer goods priced month over month. *** Cassidy Turley BRE Commercial †

Industrial rents are expressed as triple net Latest data at time of press

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A u g u s t 2012

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Trickle Up

A View from the Top

Matt Widdows: Advancing Real Estate through Technology

by Alison Stanton

When it comes to technology and the many ways it can help real estate agents do their jobs better and more efficiently, Matt Widdows, founder and chairman of HomeSmart International, is a true visionary. Even before he opened his Phoenix-based company in January, 2000, Widdows recognized the need for better technology in the real estate business.

“I saw a lack of technology in real estate, and when it came to brokerages I thought we could do a better job,” he says. For example, when HomeSmart opened in 2000, Internet access was still pretty limited. “No one had mobile access, and the computer technology that we did have was antiquated,” he says. Recognizing the importance of being able to work remotely, Widdows started implementing mobile technology early on, which allowed the company’s real estate agents to do mobile searches while in their vehicles. Over the years, the real estate industry has moved forward and mobile technology is now a big part of doing business, but at the time, Widdows’ ideas were revolutionary.

“Today, we still continue to create our own software that powers our systems and we provide cutting-edge tools that make it easier for our real estate agents to do their work and help their clients,” he says. “I have had my own in-house development staff for eight years, and they develop all our in-house software.”

Propriety software they have written called RealSmart Agent SmartPanel and RealSmart Broker Back Office allow complete business management for the company’s real estate agents — from paperless transaction management to unique listing marketing tools such as YouTube uploads and custom websites for all of their listings. Explains Widdows, “This system integrates into our back-office system that is custom-written to manage the brokerage side of the business, including employee productivity tracking, recruiting and retention, and closing and accounting functions.”

Matt Widdows has grown HomeSmart from two real estate agents in 2000 to more than 4,000 today

In addition, the branch offices have a 42-inch screen that allows HomeSmart to have centralized reception. “When customers walk into one of our branch offices, they are greeted by a friendly receptionist located at our corporate office who can then intercom the entire office, call the agent that they are there to meet, or even unlock doors remotely,” Widdows says, adding that using a virtual receptionist allows him to maintain a smaller reception staff.

Widdows’ experience with technology goes back more than 20 years.

In the early 1990s, he owned a medical computer company that focused mainly on accounts receivable systems for the medical industry. In 1992, Widdows earned his real estate license and “tinkered with real estate on the side” while still running his company. By the mid 1990s, Widdows had sold his company and was working in real estate full time. By 1999, Widdows says he realized he could apply his technological experience to the real estate market and decided to open HomeSmart, a residential real estate brokerage company.

HomeSmart’s use of advanced technology has not only helped its agents provide top-notch customer services to their clients, it has also helped the company grow into one of the fastest-growing real estate brokerages in the country. HomeSmart is the largest real estate brokerage in the Southwest and is among the top 10 largest nationally on the Inman News and National Association of Realtors rankings.

Widdows credits his company’s cutting-edge technology with helping HomeSmart survive HomeSmart International is the fastestthe recent economic issues and collapse of the growing real estate brokerage firm in Arizona. real estate market, and come out even stronger.

More than 4,300 sales agents work for the “The Phoenix real estate market definitely saw company. a big downturn, but our use of technology HomeSmart began franchising in May 2011. has made HomeSmart more streamlined and HomeSmart has 13 corporate offices — efficient.

Because we are not employee-heavy, 12 in Arizona and 1 in Palm Springs, Calif. — we have done very well.” and 10 franchises.

■■ ■■ ■■ ■■

■■ As of May 2012, sales volume was $2,670,000,000.

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A u g u s t 2012

HomeSmart International homesmartinternational.com

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Photos: HomeSmart International

Matt Widdows’ Smart Moves

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19

How Are Arizona Businesses Getting a Piece of It? 20

a u g u s t 2012

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Arizona has been building its position as a player on the international stage, and opportunities continue to expand.

by Don Rodriguez Attorney Karen Dickinson recalls the earlier days of her career when she traveled on business from Arizona to other countries. “I spent most of my career with people saying, ‘You’re from where?’” she recalls. Not exactly what anyone would want to hear after a flight to the other side of the world. She even found it challenging to build her credibility simply because she was from here.

What helped in the 1990s was Dickinson’s representing her employer, Honeywell, a firm with a reputation around the globe. As a representative of a multinational company, “I could have been from anywhere,” so doors opened to her. But for smaller Arizona firms at the time, it was hard just to find the right door to knock on.

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21

Arizona Comes Out of the Shadows What a difference a new century can make. In her roles now representing international clients for the Quarles & Brady law firm in Phoenix and as chair of the Arizona District Export Council, she has gained the experience to cite three key factors underlying the improved climate for Arizona exporting: • A strong economy prompting countries such as Canada to come calling; • The Internet, which opened access to the rest of the world; and • A state that widened its view beyond its immediate neighbors to the north and south.

The year 2008 was a peak one for Arizona when it came to exports.

Companies in the state collectively exported nearly $19.8 billion to foreign customers, according to data collected by the U.S. Census Bureau. After nearly everyone took a hit during the Great Recession, the Arizona exports tally recovered in 2011 to nearly $17.8 billion — about 10 percent off the mark set three years earlier.

Through it all, there were 10 countries that were destinations for about three quarters of all Arizona exports despite companies here experiencing a drop in export revenue by slightly more than 7 percent from 2008 to 2011, the Census Bureau figures show. The top three countries, respectively, in both years were Mexico, Canada and China.

Other than Germany maintaining the sixth spot, the remaining six countries swapped positions by 2011. Moving up were Japan (from No. 7 to 4), Thailand (from No. 9 to 8) and Malaysia (from No. 10 to 9) and dropping were United Kingdom (from No. 4 to 5), Singapore (from No.5 to 7) and France (from No.8 to 10).

The value of Mexico as an export destination goes beyond Arizona.

According to the report “Realizing the Full Value of Crossborder Trade with Mexico” issued by Arizona State University’s North American Center for Transborder Studies, Arizona is among 22 states that count Mexico as their No. 1 or No. 2 export market, and Mexico is a Top 5 market for 14 other states. For every dollar Mexico makes from exporting to the United States, it in turn spends 50 cents on U.S. products or services, which demonstrates the unique quality of the “joint production” relationship of the two countries, the report says.

While the relationship with Canada is considered strong, there has been a slight setback. The Consulate of Canada office established in Phoenix to stimulate more economic activity between the two nations closed suddenly a few months ago. The shutdown was reportedly a cost-cutting measure as the Great White North struggles to balance its own books.

Total 2011

Exports From Arizona

$17,793,213,040

46%

Percentage of Top 10 in North America

#1 Mexico ($5.97 Bil) #2 Canada ($2.13 Bil)

23% Other

$

Technology Leads the Exports The largest sector for Arizona exports is technology. Claiming the largest share at nearly $2 billion in 2011 were companies involved in aerospace and defense. Some fears have arisen that proposed cuts in U.S. defense spending could take a big slice out of the state’s share of the pie. Consider that some tech exports sent to other countries return to the United States in the form of larger components used in A&D, and it’s easy to understand what’s at stake in the supply chain that begins in Arizona.

22

a u g u s t 2012

46% North America

20% Asia

11% Europe

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Top 10 Arizona Export Countries Arizona is quickly becoming a player on the international scene as we export such high-tech goods as semiconductors and solar products. With $17 billion in exports and experts saying there is more where that came

from, Arizona businesspeople are right to be looking at opportunity where it comes to global trade. Below, we have mapped the top 10 Arizona trade partners and included the 2011 numbers and regional percentages of the overall trade revenue.

20% Percentage of Top 10 in Asia

11% Percentage of Top 10 in Europe

#5 United Kingdom ($0.79 Bil)

#3 China ($1.0 Bil) #4 Japan ($0.83 Bil) #7 Singapore ($0.58 Bil)

#6 Germany ($0.77 Bil)

#6 Thailand ($0.55 Bil)

#10 France ($0.48 Bil)

#9 Malaysia ($0.49 Bil)

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23

However, there is cause for some hope. “The budget indicates that priorities will shift from new manned aircraft systems towards unmanned aircraft systems,” notes David Dozer, CEO of Infrared Laboratories — whose products serve such fields as defense and astronomy — and an ADEC member. With the work already done at Fort Huachuca with the unmanned systems, there are suppliers presently in the state to fulfill the needs. Even if there are some cuts in defense, the civilian aircraft part of A&D remains significant. For example, orders in the aircraft interior market have experienced a recent resurgence in business, Dozer says.

Among the smaller, non-multinational exporters, Dickinson says Arizona “finally has a reputation outside the country.” With such organizations as the Greater Phoenix Economic Council and now the Arizona Commerce Authority making overseas marketing essential to their operations, representatives from such countries as Italy, Spain and China have been coming here, according to Dickinson. “Arizona has a global reputation as a solar state,” not just as investments but as suppliers, she says.

No matter whether a company wants to do business across the Pacific or closer to home in Mexico, the field is far from crowded. According to the U.S. Commerce Department, about 1 percent of American companies export their products or services. Given the economic history of the United States, this isn’t surprising to Eric Nielsen, director of the U.S. Commercial Service in Arizona and executive secretary of ADEC. “The U.S. domestic market is so large and has performed so well, most small companies haven’t been compelled to find growth overseas,” he says. “Clearly, there’s room for more companies to get into the game.” For Arizona, the companies finding the most success are those developing technology in demand by other countries, especially in aerospace and defense, Nielsen says.

Window to the World The Arizona District Export Council — currently headed by Executive Secretary Eric Nielsen — provides statewide leadership in international trade through volunteer international trade veterans and experts appointed by the U.S. Secretary of Commerce. ADEC collaborates with Arizona business, public and private sector groups to stimulate economic growth through trade and investment.

There are several ways to connect with ADEC: Arizona companies needing export assistance can contact the U.S. Export Assistance Center and talk to trade specialists who can reach out to ADEC members to offer advice for the company.

Because all members are volunteers, the advice is free.

Individuals who want to help Arizona be a “global ready” state can become a Friend of ADEC to assist as volunteers at various events and activities.

ADEC and the U.S. Commercial Service annually nominate new ADEC members for approval by the Secretary of Commerce.

With 30 to 35 member positions, there usually are three to four spots open for nominations each year.

•

• •

Arizona District Export Council

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a u g u s t 2012

exportaz.org

Interest and Opportunities Expand Nielson notes the past five “tumultuous” years seem to have increased the interest in small and medium-sized companies wanting to do business with foreign markets. “The Arizona U.S. Export Assistance Center is reminded of this on a daily basis as we work to help local firms identify international opportunities to sell their products,” he says.

With the U.S. Department of Commerce reporting about 1 percent of American companies export their products or services, that leaves room for just about any type of company to take that first step. To help, the Export Assistance Center’s services include mentoring and counseling on all aspects of international business as well marketing on the Web. Ironically, it has taken one Phoenix-based multinational to help smaller technology manufacturers crack the export market although it doesn’t even make tech products. From Arizona, technology distributor Avnet oversees operations in more than 300 locations worldwide and provides support to businesses making sales in more than 70 countries, says Vince Keenan, the company’s vice president of investor relations.

Arizona is an important part of the equation for Avnet “because of the state’s attractive business climate, educated work force, community college and university system, reliable commercial transportation and the quality of life Arizona offers that allow us to attract and retain world-class talent,” he says.

In addition to its distribution activities, the company offers services ranging from logistics and financing to sales and technical support that allow firms to sell and export their products to countries around the world. Besides working closely with large Arizona firms such as Intel, Microchip and ON Semiconductor, Avnet also has supported several small to medium-sized businesses in the state, helping them design, build and bring their technology solutions to market. “With these and many other services we provide, our suppliers and customers are able to grow their businesses, expand geographically and capture more revenue,” Keenan says. These services range from support, such as marketing and sales, to streamlining processes that result in reduced overhead and time to market.

Dickinson notes technology also is at the heart of more companies being able to be part of the global marketplace. Because of the struggling economy, companies have turned to teleconferencing methods such as Skype. “You could do the whole deal without going anywhere,” which wasn’t the case previously, she says. Having the ability for such interactions has helped in doing business with companies in Europe and Canada.

But this isn’t the case with countries such as Mexico and China that put a lot of stock in personal contact. “They want to see everyone,” Dickinson says. That’s one of the reasons Arizona Gov. Jan Brewer led a trade mission to China this past November — the same month that 20 other U.S. governors went there — becoming the first Arizona governor to go to China. Another noteworthy event was the 2009 visit of Wu Bangguo, chairman of the Standing Committee of China’s National People’s Congress — that country’s top legislature — to renewable energy companies here. Calling the step “huge,” Dickinson points out, “China came to us.”

Dickinson’s observations about the rest of the world, and China in particular, are based on extensive experience in international commerce. inbusine ssmag.com

“The U.S. domestic market is so large and has performed so well, most small companies haven’t been compelled to find growth overseas,” says Eric Nielsen, director of the U.S. Commercial Service in Arizona and executive secreShe negotiated numerous transactions outside the United States during tary of ADEC. “Clearly, there’s room for more companies to her stint with Honeywell. She also is co-chair of the China Law Group get into the game.” for Quarles & Brady, which opened an office in Shanghai last year. Key reasons for establishing a presence were the Chinese five years ago began showing interest in mid-sized companies such as those found in Arizona and China implemented a new “Get Out Policy” that encouraged doing business in other parts of the world, she says.

While it’s not unusual for companies new to doing business in China to establish offices there, Arizona-based firms are not taking that step. Quarles & Brady, which is considered a consulting firm as its attorneys are not licensed to practice law in China, is not there year-round yet but, rather, shares office space with Chinese partners (which include lawyers). Plans call for the firm to hire a Chinese lawyer, Dickinson says.

Another person who has seen an increased interest in exporting is recent visit to China as a step forward, Bruhnke cites as a negative Doug Bruhnke, CEO of Growth Nation, a global marketing firm with SB1070 and the fallout that resulted when the rest of the world got wind clients in technology, manufacturing, healthcare and professional of the measure recently unraveled by the U.S. Supreme Court. services. Bruhnke also is president and founder of Arizona International Bruhnke also blames the Arizona media as another barrier. A Growth Group, which holds events to help executives grow globally prime example was the coverage of former Arizona Commerce through education, certification, networking and collaboration. Nearing Authority CEO Don Cardon and his compensation package that many its fifth year in existence, AZIGG has more people involved since the considered lucrative despite his being at the helm at a time when more economic slowdown as they recognize that a “significant amount of international focus shifted to Arizona. “Here’s someone looking out for the world’s worth is outside the United States,” Bruhnke says, adding, the best interests of Arizona” Bruhnke says. “Criticism is focused on the “They’re asking themselves ‘What’s the opportunity for me?’” wrong things.”

But the tide is turning, he says, thanks to new local leadership. Mayor W.J. “Jim” Lane of Scottsdale is a “perfect example” of understanding Image and Understanding the value of international business, Bruhnke says, noting that Lane takes Impact International Business the time to meet with every foreign business representative who wants When he thinks of a state that’s making a significant mark on the to see him. Bruhnke sees the same traits in new Phoenix Mayor Greg global scene, Bruhnke looks to Arizona’s neighbor to the north, Utah.

Stanton, who addressed attendees at Mexico’s Annual Conference of He began doing business with clients there in the 1980s and notices an Municipalities in March. environment that has become conducive to doing business with the rest There is promise these homegrown solutions that range from of the world to the point Utah doubled its exports in the last five years. established programs to a new generation of local leadership will help “They know what it takes to interact with someone from other places,” homegrown products reach new markets, resulting in new highs for he says. Part of that comes from many members of the Utah Legislature Arizona exporters. going on missions with their church, making them more comfortable working within other cultures and less isolated from the rest of the world.

Avnet avnet.com Although both states share a conservative heritage, that’s about where Growth Nation growthnation.com similarities end. Bruhnke recalls that former Gov. Janet Napolitano Infrared Laboratories irlabs.com had an understanding of international business. “But the [current] Quarles & Brady quarles.com/phoenix legislature and the governor don’t get it,” Bruhnke says. “We’ve made U.S. Export Assistance Center export.gov/arizona progress but not enough.” While Dickinson points to Gov. Brewer’s inbusine ssmag.com

a u g u s t 2012

25

Tech

Innovations for Business

Rx: When a Website Needs Surgery You describe the symptoms, but leave the diagnosis to the professionals

by Joe Thomas

... So the guy stands there with his mouth agape and says, “But Doc, why do you have to operate on my foot? The splinter is in my finger!”

What does this punch line have to do with fashioning a successful website? Its underlying lesson applies to about 80 percent of people who can’t figure out why their website doesn’t “work.”

Pretend your website is the patient in my half-a-joke. Now, toss in a “Web guru” as the doctor. There are two main reasons why you’ve gotten surgery on a foot when a finger was the problem.

You didn’t correctly explain the symptoms. If your product or book is not selling from your website, don’t tell the doctor you don’t like the colors. Or that you need more Flying Thingies on the page. Tell the doctor that your product is not selling from your website.

Some people consult with their sister-in-law, best friend and lawn boy before seeking the help of a professional. Or they guess at the

26

A u g u s t 2012

cause of the problem themselves. When they finally consult with a professional, they tell him or her what they want: Use blue not red; make that picture bigger; add a joke of the day. But for the right diagnosis, just tell the doctor, “The site’s not selling” and let him or her figure out why.

When you bring in a pro to evaluate your site and identify problem areas, don’t be offended at what they tell you (odds are, you’re not going to like a lot of what you hear). And don’t be so attached to your current site that you’re not willing to make changes. A solid developer will ask to see your server stats (and you do have server stats, even if your current guru tells you differently). By analyzing your traffic patterns, you’ll be able to see your problem areas and, possibly, immediate solutions. It’s not always that simple, but it’s the best place to start.

This presupposes, of course, that you have a qualified website inbusine ssmag.com

Books professional — which is the point of reason number two why your website isn’t working.

There are a lot of quack doctors out there! Let’s be honest, a surgeon makes his living performing surgeries, and a Web guru makes his living performing guru work on websites. The moral?

Without patients and Web projects, the surgeon and the Web guru go on unemployment.

In all aspects of business, and especially Internet marketing, some people may say whatever it takes to sell you on “surgery.” Proceed with caution! Before you hire someone to develop, design or “fix” your site, get referrals. Ask people you trust for recommendations.

Ask the “doctor” questions. If he or she can’t take the time to explain every procedure, find someone who will. You need to understand the suggestions — and the reasons for them. Also, be warned: There is no Standard Pricing Guide. My best advice is to avoid being sucked into the cheapest deal you can find or being fooled by the “we are the best so we charge the most” designers.

If you’re not getting the results you need from your site, consider these questions:

How does your site stack up against your competition? Whether you’re a manufacturer, business or blogger, you have competition.

Surf around and take a look at the other guy’s site. How does his look compare to yours? We’re not talking about what the site says, just the overall aesthetics. Does yours look as good, or better?

When visitors open your site, do they know what you’re selling?

Obviously, you know your product or service, but is it plainly visible to visitors? Is the information your visitors are looking for easy to find and understand? Are the “calls to action” — such as “sign the petition,” “read the blog” or “buy my cool product” — easy to find?

Did you check your ego at the door? Who is your site trying to please? Are you trying to impress yourself or your customers? Too often, websites get hung up on self-importance. While it is important to show your visitors that you’re an expert, the product or service needs to be the focal point. If you’re selling beans or bikinis, nobody really cares that you climbed Mount Everest in your pajamas last October.

Are you actively marketing your site? Just having a site isn’t enough. The competition is fierce and qualified traffic is hard to come by. If your site isn’t getting qualified traffic, it’s going to be very difficult to sell anything! Today’s Internet thrives on friends’ lists.

You must be active in social media; without it, you are destined for failure. Engaging in social media adds value. Friends, Likes, Tweets, Taps and Pings is where it’s at. I call it “exponential marketing.”

Common sense is the most valuable tool at your disposal, but be smart enough to know what you don’t know! Successful websites don’t just appear. They’re properly developed, cultivated and then regularly watered.

Developing a successful website is hard work; finding the right surgeon can be even harder.

Left Brain Digital leftbraindigital.com

Joe Thomas, founder and owner of Web development company Left Brain Digital, is a an award-winning Web designer/developer with more than 18 years of experience in print and Web design and development. Thomas’ work became a major influence in graphic and Web design in the “Y2K” era of the Internet’s dot-com explosion.

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Getting Social in Business

We First: How Brands and Consumers Use Social Media to Build a Better World Combining social media tools with socially conscious brands, the two major trends shaping tomorrow’s consumer climate, Simon Mainwaring presents a visionary new model for companies and organizations to maximize both their own visibility and their contribution to the greater good. He shows how brands can leverage social media to build consumer goodwill, loyalty and profit, as well as how consumers can use their new social networking power to drive sustainable change in the business world.

Simon Mainwaring $17 • Palgrave Macmillan • October 2012

Social Media Marketing All-in-One for Dummies This bestselling guide to social media marketing has been completely updated to cover the newest vehicles, including Groupon and Rue La La, location-based services like Foursquare, and new social networking sites like Google+ and Pinterest. Checklists, case studies and examples will help readers decide the best places to spend their marketing dollars, and learn about valuable social media tools and analytics methods that can help assess the success of their efforts.

Jan Zimmerman and Doug Sahlin $29.99 • John Wiley & Sons • October 2012

Socialnomics: How Social Media Transforms the Way We Live and Do Business Socialnomics is an essential book for anyone who wants to understand the implications of social media on our daily lives and how businesses can tap the power of social media to increase their sales, cut their marketing costs and reach consumers directly.

In this revised and updated second edition, author Erik Qualman presents new material based on meeting with 75 Fortune 1000 companies, 50 colleges and universities, and more than 100 small businesses and nonprofits since the first edition.

Erik Qualman $19.95 • John Wiley & Sons • October 2012

Social Media Is Bullshit In this guide, journalist and social critic B.J. Mendelson skillfully debunks the myths of social media. Listening to the pundits, Internet gurus, marketing consultants and even the mainstream media, one would think social media was the second coming. Mendelson illustrates how the notion of “social media” first came to prominence, why it has become such a powerful presence in the marketing field, and who stands to benefit each time it’s touted in the press.

B.J. Mendelson $21.99 • St. Martin’s Press • September 2012

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NonProfit

by RaeAnne Marsh

Actions to build Community

Epilepsy Foundation of Arizona: Golf Tourney Supports Operation Outreach for Injured Veterans Snapshot

The Apache Longbow helicopter sitting on the golf course indicates the Salute to Armed Forces Golf Tournament is not an ordinary round of golf. Punctuating play with further excitement at various holes are additional contests, among them a hole-in-one challenge sponsored by a car dealership, the Phoenix Coyotes’ challenge to make the golf swing with a hockey stick and a “Beat the Pro” challenge against XTRA Sports radio’s “Backspin the Golf Show” co-host Corey LaRusso.

With seed money from the employees at Boeing’s Mesa Apache plant, the Epilepsy Foundation of Arizona founded its Operation Outreach program three years ago, and keeps it going with the funds raised by the golf tournament. The program provides resources and referral services for soldiers and their families who have suffered a traumatic brain injury, which presently number about 15,000 in Arizona.

With all the advances in protection, EFA’s executive director Mark Valentino points out that the head remains most vulnerable to injury.

Says Valentino, “The more who come back [from war], we have to be ready, because we have no idea how many will develop epilepsy.”

Noting that the brain is very fragile, he adds, “Traumatic brain injuries are on the rise.”

Up to 34 percent of those who have suffered traumatic brain injury are at risk of developing post-traumatic epilepsy — even higher among populations that have experienced a penetrating head wound.

■■ EVENT: Salute to Armed Forces Golf ■■ ■■

Epilepsy Foundation of Arizona epilepsyaz.org

■■ ■■

Tournament, Sept. 14, on the Monument course at Troon North Golf Club, followed by a lunch with keynote speaker Lt. Gen. David Perkins.

The luncheon is included in the golf registration, but may also be purchased separately by those not wishing to golf.

Recognizing the growing need to address the issue of post-traumatic epilepsy, the Operation Outreach program has been adopted by other Epilepsy Foundation affiliates.

The mission of the Epilepsy Foundation of Arizona, founded in 1971, is to lead the fight to stop seizures, find a cure and overcome the challenges created by epilepsy.

The numerous symptoms of epilepsy include staring into space and lapses in memory in addition to the commonly recognized symptom of seizures.

Hon Kachina Council: Inspiring Volunteerism ■■ EVENT: Hon Kachina Awards on ■■

■■ ■■

Sat., Sept. 29 at the Camelback Inn in Scottsdale, a fundraiser for the Hon Kachina Council.

“Fundraising is the icing on the cake,” says Betz, who says the council’s primary focus is the awards and that it takes more than 500 volunteer hours to research the nominees.

Funds are raised through attendance at the event and by corporate sponsors.

Funds raised at the Hon Kachina Awards are divided among the honorees, usually averaging $2,500-$3,000 each. Hon Kachina Award winners designate the nonprofit they choose to benefit.

Volunteers take center stage as the Hon Kachina Council celebrates their efforts at the prestigious Hon Kachina Awards, an annual event held this year on Sept. 29 at the Camelback Inn in Scottsdale. Showcasing their contributions to the community, the event presents them as examples to inspire others to volunteer.

The black-tie-optional event starts with cocktails on the picturesque patio of the Camelback Inn. Between courses during the dinner that follows, hand-carved kachinas of Hon, the powerful Hopi spirit of healing, are presented to the honorees while a video vignette depicts their achievements. The evening culminates in a dessert extravaganza, once again on the patio, that is also a mix and mingle offering guests the opportunity to meet the Hon Kachina honorees.

Begun with a focus on healthcare, as the organization’s roots are with St. Luke’s Medical Center, the Hon Kachina Council has adopted the mission to inspire volunteerism, recognizing ordinary people doing extraordinary things,

applauding them as models to inspire others to volunteer. Executive director Pam Betz explains, “It evolved that the health of the community was maintained by volunteers doing all sorts of things.”

Hon Kachina Council honkachina.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: Epilepsy Foundation of Arizona (top); Ben Arnold Photography (bottom)

Snapshot

www.inbusinessmag.com

August 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.

Arizona Small Business Association

Human Resources Update Seminar Tues., Aug. 17 — 8:00a – noon In the field of Human Resources, new concerns about the employee-employer relationship are always evolving and new regulations are constantly being added to address those concerns. Those handling their business’s personnel or human resources functions have the added task of staying on top of it all. The Arizona Small Business Association is offering this half-day seminar at its Business Education Center in Phoenix that will cover topics needed to tackle some of the tough issues that are currently affecting workplaces.

The seminar is presented by ASBA partner Qqest Employer Services, and will cover topics that include requirements under the Fair Labor Standards Act, I-9 completion, retention and audit preparation, strategies for communicating effectively and what businesses need to know about safety and workers’ compensation. Trainers are Qqest vice president of human resources services Kevin Smith, Psy.D., S.P.H.R.; ASBA safety program director Harold Gribow, C.S.P., A.R.M., A.L.C.M.; and Persogenics chief operating officer Michael Chaney, who serves as a visiting professor to various universities.

This workshop fulfills continuing education requirements and qualifies the attendees for 3.75 general CE credits toward Professional in Human Resources, Senior Professional in Human Resources and Global Professional in Human Resources recertification through the HR Certification Institute.

“Constantly changing legal requirements can significantly impact businesses’ procedures, employee records, company and employee rights, and so much more,” says Kristen Wilson, ASBA chief operating officer. “Being fully equipped with knowledge and being updated on these changes is vital for all HR professionals in order to protect their company from lawsuits and other negative consequences.”

Registration is $30 for ASBA members and $50 for non-members. However, the cost is waived for everyone registering with promo code MPWaive622.

—RaeAnne Marsh

Arizona Chamber of Commerce & Industry

2012 Environmental and Sustainability Summit Thurs. & Fri. — Aug. 16 – 17 The Arizona Manufacturers Council and Arizona Businesses Advancing Sustainability are partnering to present a summit and tradeshow focused on environmental and sustainability policy and issues that concern business. Speakers include leaders from government, industry and business. The two-day event takes place in Prescott at the Prescott Resort and Conference Center.

Before settling in to a full schedule of presentations on Friday, the event kicks off Thursday with a golf tournament, with prizes in various categories from AzBAS member PING. The tradeshow will be open Thursday night and during the day on Friday.

Participating in Friday’s panels and presentations will be experts from the Arizona Department of Environmental Quality, Arizona State University Global Institute of Sustainability, Generated Materials Recovery, Arizona Public Service Company and Earth 911 as well as leadership from our state’s legislature. “Emerging Trends in Product and Chemical Regulation” panelists are Carl D’Ruiz, M.P.H., a research fellow with Henkel Consumer Goods, Inc.; and Michael Ford and Steve Owens, attorneys with Polsinelli Shughart, P.C., and Squire Sanders, L.L.P., respectively. “Big Brother Is Here: How the government is watching your operations without your knowledge” panelists are Patrick J. Cunningham, an environmental attorney, and Maribeth Klein and Mitchell Klein, attorneys with Polsinelli Shughart, P.C. Henry Darwin, ADEQ director; Edward Z. Fox, vice president & chief sustainability officer with Arizona Public Service Company; and Representative Amanda Reeve, from the Arizona House of Representatives, will present a briefing on HB2799, the Voluntary Environmental Stewardship Program. Suzanne Fallender, director of CSR Strategy & Communications for Intel Corporation, will present “Partnering for Water Reuse.” Other topics include “Industrial Waste Stream Reduction and Commercial Scrap Recovery: Challenges and Opportunities,” “Improving the Consumer Experience in a Confusing Recycling Landscape” and “Sustainability Challenges and Solutions.”

—RaeAnne Marsh Arizona Chamber of Commerce & Industry azchamber.com

Notable Dates This Month Tues., Aug. 28 Primary Election 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.

Arizona Small Business Association asba.com

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O n t h e Ag e n d a

August 2012

Ahwatukee FOOTHILLS Chamber of Commerce

ARIZONA SMALL BUSINESS ASSOCIATION

SCORE One-on-One Business Counseling

The Process of Business Development

Thurs., Aug. 2 & 16 Call for appointment

Free Ahwatukee Foothills Chamber of Commerce 4435 E. Chandler Blvd., Phoenix (480) 753-7676

Women in Business Luncheon Tues,, Aug, 21 11:30a – 1:00p

“Organization for You and Your Business” Members: $15; guests: $25 Foothills Golf Club 2201 E. Clubhouse Drive, Phoenix ahwatukeechamber.com

Arizona Chamber of Commerce & Industry 2012 Environmental and Sustainability Summit

Thurs. & Fri., Aug. 16 – 17

Tradeshow and summit presented by the Arizona Manufacturers Council and Arizona Businesses Advancing Sustain­ ability. Leaders from government, industry and business will present on a variety of topics related to environmental policy.

Members: $165; non-members: $195 Prescott Resort and Conference Center 1500 State Route 69, Prescott Colleen Kielty, (602) 248-9172 ext. 123

Thurs., Aug. 9 & 23 9:00a – noon

Three-hour presentation and one-hour business review process for each client.

The business presentation will identify the specific business sectors linked with a detailed implementation plan. This assists start up and existing business owners to create a realistic overview of a new business model or integrate a new function into their existing business.

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

Creating Your Effective Networking Commercial Tues., Aug. 14 2:00p – 3:00p

Receive useful tips on developing an effective 30-second networking commercial in this hands-on workshop.

This is a great opportunity to craft a unique and attention grabbing “elevator speech” for networking events and prospective customers for the first time.

Put your commercial to the test by staying for the Fast & Curious Speed Networking immediately following the workshop.

Free; seating is limited ASBA’s Business Education Center 4600 E. Washington St., Phoenix asba.com/events

ARIZONA HISPANIC CHAMBER OF COMMERCE

How to Use the Cloud to Streamline Your Business

Multicultural Networking Forum

The focus of this workshop is to educate business owners on what “the Cloud” really is, how it can (or cannot) benefit your business operations, why there is so much “buzz” about it, and explain why there is such a high demand to convert to this technology. This is not a technical session or a sales presentation (nothing to “buy” at the end).

Free; space is limited ASBA’s Business Education Center 4600 E. Washington St., Phoenix asba.com/events

Mon., Aug. 6 4:30p – 7:00p

$5 pre-sale; $10 day of event Fiesta Inn and Conference Resort 2100 S Priest Dr., Tempe onecommunity.co

Latina Business Enterprises Thurs., Aug. 23 10:30a – 1:30p

Social media workshop and networking lunch Members: $10; non-members: $20 Casa Ramos 1526 E. Main St., Mesa (602) 279-1800

Arizona International Growth Group Green, Global and Greek 2012 Mon., Aug. 6 11:00a – 1:00p

Annual update on global opportunities in sustainability. $38 Greekfest Restaurant 1940 E. Camelback Rd., Phoenix azigg.com

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Tues., Aug. 21 9:00a – 10:30a

HR Update Seminar Tues., Aug. 17 8:00a – noon

Learn how to tackle some of the tough issues that are currently affecting workplaces. This workshop qualifies you for 3.75 general CE credits. Attend as our guest with promo code: MPWaive622.

Members: $30; non-members: $50 ASBA’s Business Education Center 4600 E. Washington St., Phoenix asba.com/events

ARIZONA TECHNOLOGY COUNCIL

Economic Club of Phoenix

Council Connect

Leadership Development Workshop: Effective Negotiations

Wed., Aug. 15 11:30a – 1:00p

Data storage trends and changes driving powerful solutions to help manage this data and its loss. Presented by Oracle.

Members, $35; non-members: $55.

Lunch is provided.

Seasons 52 2502 E. Camelback Rd., Phoenix aztechcouncil.org

2012 Marketing Technology Summit Thurs., Aug. 30 12:30p – 6:30p

“Grow Mobile — Understanding Why Mobile Marketing Is Imperative for Your Success.” Arizona Technology Council and Business Marketing Association present panel discussions, a keynote speaker and sponsored expo. Presented

by Infusionsoft.

AZTC/BMA members, $40; nonmembers: $60 Hilton Scottsdale Resort & Villas (grand ballroom) 6333 N. Scottsdale Rd., Scottsdale aztechcouncil.org

Central Phoenix Women Luncheon

Tues., Aug. 14 11:30a – 1:30p

“The Longevity Challenge — What Every Woman Needs to Know,” presented

by Maryglenn Boals of MgBoals & Associates LLC. $75 The Ritz-Carlton, Phoenix 2401 E. Camelback Rd., Phoenix (602) 263-3589

CHANDLER CHAMBER OF COMMERCE Education Forum 2012 Wed., Aug. 29 7:15a – 9:30a

“Education and Remaining Globally Competitive.” Keynote speaker: Michael Crow, Ph.D., president of Arizona State University.

Members: $20; non-members: $30 Hilton Phoenix/Chandler 2929 W. Frye Rd., Chandler chandlerchamber.com

e-Women Network “Accelerated Networking” Luncheon Wed., Aug. 8 11:30a – 1:30p

Presenter: Laura Gisborne Members: $38; non-members: $48 Arizona Grand Resort 8000 S. Arizona Grand Pkwy., Phoenix Johnell McCauley, (623) 256-4486

Fri., Aug. 17 8:00a – noon

$550; discounts available for some groups ASU Research Park 8750 S. Science Dr., Tempe (480) 965-7579

Greater Phoenix Chamber of Commerce Professional Women’s Roundtable Tues., Aug. 7 11:30a – 1:00p

“Thriving in a Male-Dominant Industry,” presented by Shelly Esque, vice president of Corporate Affairs, Intel Corporation and president of the Intel Foundation.

Members: $15; non-members: $25 National Bank of Arizona (Conference Center) 6001 N. 24th St., Phoenix phoenixchamber.com

NATIONAL ASSOCIATION OF WOMEN BUSINESS OWNERS NAWBO University Wed., Aug. 8 9:30a – 11:00a

“5 Steps to Creating a Marketing Roadmap to Grow Your Business and Attract More Perfect Clients.” Ely Delaney, co-founder of Your Marketing University, will show you how to become a marketing rock star, help you determine your perfect customer, create a system that works for years to come and more.

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

NAWBO Luncheon Wed., Aug. 8 11:00a – 1:00p

“Beyond the Brick and Mortar. The Real Value of Your Business,” presented by Maria Crimi Speth of Jaburg & Wilk, P.C. Guests will learn how to increase the value of their business, why registering their brand as a federal trademark is so important and more.

Members: $38; non-members: $48; addition $15 after Aug. 3 Phoenix Country Club 2901 N. 7th St., Phoenix nawbophx.org

North Scottsdale Chamber of Commerce Business Resource Lunch — Mayor Candidate Forum Wed., Aug. 8 11:30a – 1:30p

Members: $20; guests: $30 Grayhawk Golf Club 8620 E. Thompson Peak Pkwy., Scottsdale northscottsdalechamber.org

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

PEORIA CHAMBER OF COMMERCE Cloud Information Session Thurs., Aug. 9 11:00a – 1:00p

We’ll look into the benefits and drawbacks with moving your network to the Cloud and whether your company should take advantage of what the Cloud has to offer.

Free; lunch is included City of Peoria City Hall (Pine Room) 8401 W. Monroe St., Peoria

Small Business Roundtable Wed., Aug. 29 9:00a – 11:00a

Peoria businesses come together to share what they think of Peoria’s Small Business Program. How are we doing? What are we doing well? What can we do better?

Free Point of View Room 9875 N. 85th Ave., Peoria Debbie Pearson, (623) 773-5210

SURPRISE REGIONAL CHAMBER OF COMMERCE Newsmakers Luncheon Fri., Aug. 10 11:30a – 1:00p

Informative presentation from an Arizona newsmaker. Keynote address by Senate candidate Wil Cardon.

Members: $20; non-members: $20; preregistration is required Anacapa Restaurant 22135 N. Mission Dr., Sun City West Mary Orta, (623) 583-0692

Biz to Biz Trade Show Thurs., Aug. 23 3:00p – 7:00p

In conjunction with West Valley chambers of commerce: Buckeye Valley; Glendale; Peoria; Southwest Valley; Surprise Regional; Wickenburg; and sponsored by The Wigwam Resort.

Free The Wigwam Hotel & Resort (Ballroom) 300 Wigwam Blvd., Litchfield Park SW Valley Chamber, (623) 932-2260 for space reservations

Business Education Seminar Fri., Aug. 24 8:30a – 10:00a

“Getting in the Door Without Cold Calling,” presented by Allan Himmelstein.

Free Communiversity @ Surprise 15950 N. Civic Center Plaza, Surprise Mary Orta, (623) 583-0692

TEMPE CHAMBER OF COMMERCE Hot Topics and Lunch Thurs., Aug. 16 11:30a – 1:00p

“Recovery Training and Disaster Preparedness”: A panel will present on holistic urgent recovery training and community preparedness exercises. This discussion will cover the community in general and also how these techniques apply to businesses in post-disaster situations.

Members: $25 in advance, $30 day of event; general public: $35 Radisson Airport North 427 N. 44th St., Phoenix Sachiyo Ragsdale, (480) 967-7891

West Valley Women Luncheon

Tues., Aug. 7 11:30a – 1:00p

“Fabulous Footwear Contest” $35 Arizona Broadway Theatre 7701 W. Paradise Ln., Peoria (602) 263-3589

Women of Scottsdale Luncheon

Fri., Aug. 17 11:30a – 1:30p

$35 The Westin Kierland Resort and Spa 6902 E. Greenway Pkwy., Scottsdale (480) 391-6585

OTHER BUSINESS EVENTS Business Professionals Breakfast Thurs., Aug. 9 8:30a – 10:00a

Come prepared with your questions, as this will be an open format for you to get the answers pertaining to your business or industry. Starbucks coffee and a continental breakfast will be served.

Free The Microsoft Store 7014 E. Camelback Road, Scottsdale scottsdaleevents@microsoft.com

The Technical Edge: Networking for Real Estate Professionals Mon., Aug. 27 4:00p – 6:00p

Enjoy refreshments while mixing and sharing ideas and leads with other real estate professionals.

Free The Microsoft Store 7014 E. Camelback Road, Scottsdale scottsdaleevents@microsoft.com If your event is directed to helping build business in Metro Phoenix, please send us information to include it in the In Business Magazine events calendar.

Email the information to: events@inbusinessmag.com.

In Business Magazine is read by those vested in business Valleywide

To get your Marketshare . . . Advertise with www.inbusinessmag.com • info@inbusinessmag.com • (480) 588-9505 inbusine ssmag.com

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31

Focus

Our Subject In-Depth

How to Set Owner Compensation

Entrepreneurs must get this right from the start or face pain and suffering later

by Greg Crabtree

Internal Revenue Service website or just do a Web search on the topic.

Every owner I have convinced to increase his or her wages to market and pay the payroll tax has made a true profit and gotten the full wage. Each saw real net income for the first time and made the decisions to hit the real target instead of aiming low.

Multi-owner Businesses Often, two people form a business and decide each will own the same percentage and make the same wage. Bad idea! I have rarely seen any two people worth the same wage. Plus, equity ownership should be based on contribution of equity. If the equity contributed is sweat equity from going without wages, the value must be consistent with the amount of that sweat equity.

Another challenge arises when the owners’ effort is not consistent over the years and they face the situation of a lack of contribution by one or one reaching his or her level of incompetence in the particular role in their company. If you have the hard discussion early, you can avoid this issue and effectively move that owner to a more appropriate role or even out of the business.

It is not uncommon that one owner can cut back during lean times yet the other needs to receive pay to support his or her lifestyle. It is important to settle up quarterly or at least annually. At a minimum, account for the back wages as a liability; preferably, adjust equity and increase the ownership of the person who was willing to cut back.

Demand a Return on Investment You may have decided to take no wages or below-market wages at the start of your business. But, by not accounting for the real cost for your services as if you paid someone else to do your job, you have distorted net income (or loss!) from your business. You are not at breakeven until you are paying yourself a market-based wage and you are profitable.

Salary vs. Return on Investment Repeat this phrase until you truly understand the concept: “I get a salary for what I do, and I get a return on what I own.” Do not confuse the two. You may be the owner, but you will never grasp the potential of your business model if you combine your salary with your expected profits. Your job role in the business is distinctly different from your role as an owner in the business, and each carries a different expectation of value.

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Owner’s Job Role In the beginning stages of your business, you will likely be in charge of sales, marketing and operations, and in your spare time be CEO. The functions are not worth the same rate of pay and they all vary in the time required.

Past $1 million in revenue, your job role begins to narrow in focus. At $5 million, you likely will still be in charge of either sales or operations, and, if you are, your compensation should reflect a blended pay of both roles based on time spent.

The Tax Games People Play with Owner Compensation For United States businesses that are S corporations, owners are motivated to avoid a 15 percent payroll tax by taking little to no wages and, instead, taking distributions out of the company for their consumption needs. For warnings on this technique, however, visit the

The main reason to pay a market wage is that you (the investor) can hold you (the employee) accountable for market-based performance with no excuses. You may think you are the same person, but you really are two distinctly different people as an owner versus an employee.

A business that is paying a market-based wage to you and returning a pre-tax profit of 10-15 percent is a great business that gives you the best of both worlds — a business that would be great to keep and one that would be valuable to sell.

Crabtree, Rowe & Berger, P.C. crbcpa.net Internal Revenue Service irs.gov

Greg Crabtree, author of Simple Numbers, Straight Talk, Big Profits!, has worked in the financial industry for more than 30 years. The founder of CPA firm Crabtree, Rowe & Berger, P.C., he leads the business consulting team, helping clients align their financial goals with their profit model and their core business values.

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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.

ENTERPRISE

Risks & Rewards

Strategic Planning Vitalized A lackluster planning process leads to flawed strategy

by Samantha Howland It’s that time of year again: strategic planning season. As annual planning and preparation tasks begin popping up on corporate calendars across the country, leaders cringe at the distraction. Given the current atmosphere of uncertainty, many executives approach planning with urgency and impatience — simply looking to get it over with — rather than approaching the process with a desire and drive to create a relevant and meaningful plan.

As a result, the traditional planning process is marked by colorless research, onedimensional thinking and dreary discussions held in beige corporate conference rooms that are furnished with stale bagels and manila folders — truly a “beige zone.” As the average corporate lifespan continues to plummet — now hovering at just 40 years — this prevailing approach gives organizations a false sense of strategic security and little guidance or protection in changing markets. Strategic planning sets the course for an organization’s key choices, including claiming a market position and delighting targeted customers. It can and should be an ongoing process, rather than a dull, drab annual exercise.

Effective planning requires insight from diverse sources, alternative points of view, healthy debate, maverick voices and aspirational strategic thinking. A hierarchical, linear set of steps that have been followed for years will net similar results, without considering a broad range of new possibilities.

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Creative, non-traditional settings along with collaborative exercises that take in external viewpoints can create the right tone, setting the wheels in motion for a shift in results.

“A corporation in official planning mode is not a corporation; it’s a collection of unconscious publishers whose only goal is to produce a thick, bound book full of tight, logical goals, tactics and metrics — with not a lick of real strategy,” says Steve Krupp, Decision Strategies International CEO and planning evangelist. “The outcome is an unreadable work of fiction with no direction whatsoever on how the organization must change or the new problems it must solve.”

The following tips will help organizations avoid the beige zone and produce fullspectrum strategy: Don’t rely on the past. Strategic futures should not be based on the recent past. Plans should include a balanced combination of past, present and future issues and goals that embrace the known and unknown.

Don’t silo the process. True strategy stems from synthesis, not analysis. Research and perspectives that only come from deep views of siloed sources obscure the bigger strategic picture. It’s important for organizations to broaden their view to include a variety of sources inside and outside the confines of their industries and their experiences.

Don’t ignore the competition. Plans that fail to consider competitors are restrictive and often repetitive. With no new stimulus, they are forced to continually reproduce their own view

of the world. Organizations should consider present, past and potential competitors.

Consider more than one possible future.

Organizations need to consider more than one future in order to be prepared for new markets and unforeseen developments. Using objective measures of hard data often creates blind spots of key opportunities or threats. When organizations plan for a single future, they can become stranded by unexpected events and industry shifts.

Make moves, not books. The name “strategic plan” is an oxymoron. Real strategy planning is an ongoing, intelligent response to constantly changing realities. Plans should not be ritualized or annualized. True plans are living, breathing animals that should never be “bound” completely by time or tradition.

Don’t get lost in the process. Planning requires direction and intention. Organizations that wander aimlessly through the process are left unprepared. Successful strategic plans require a clear North Star or strategic path to gain organizational buy-in, passion and alignment and to guide decisions.

Decision Strategies International decisionstrat.com

Samantha Howland is a senior managing partner at Decision Strategies International, a recognized leader in future-centered consulting. DSI provides adaptive planning and executive development to help some of the world’s leading organizations and their top talent excel. The firm’s customized approach is structured to help clients profit from realities that haven’t happened yet.

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Industry at Its Best

Sector

What Manufacturing Means to the Valley Economy

Valley-wide and statewide, challenges and change face this core industry

by RaeAnne Marsh “Thirty years ago, manufacturing accounted for about 15 percent of output in [Arizona’s] overall economy. Now, it’s about 8 to 9 percent. That’s because other parts of the economy have gotten bigger,” says Research Professor Lee McPheters, director of the JPMorgan Chase Economic Outlook Center at the W. P. Carey School of Business at Arizona State University. He sees manufacturing continuing to be an important part of the economy, but says, “We can’t look for it to be a driver of job growth.” The proportional drop does not mean the sector itself is getting weaker, however, as he explains output per worker and wages are still high.

Average manufacturing wages in Phoenix, in fact, surpass the national average — $70,000 here, compared with $59,000 nationwide.

What’s behind this difference is Greater Phoenix’s cluster of high-tech manufacturing.

“Aerospace and defense have been the cornerstones of the manufacturing sector since the ’50s,” says Steve Macias, president and CEO of Pivot Manufacturing and president of the Arizona Manufacturers Council.

Barry Broome, president and CEO of the Greater Phoenix Economic Council, cites Honeywell, Raytheon and Boeing as pivotal in the areas of aerospace and defense, and McPheters notes that the range of suppliers to the larger electronics and aerospace companies numbers in the thousands.

Semiconductors have also been a key element of the economy. Observes Broome, “Intel and Microchip are driving most of the success in this sector in the Valley.” Macias, who sees semiconductors continuing to be a positive, points to Intel’s recently opened $5-billion plant in Chandler and says, “It helps the supporting players.”

Historical Strengths Challenged The importance of Intel’s new plant notwithstanding, semiconductor manufacturing has contracted by more than 66 percent within the past 10 years, with employment dropping from 98,000 jobs to inbusine ssmag.com

fewer than 33,000, according to Broome. GPEC has therefore put a lot of emphasis on solar and renewable energy in its stead, identifying that manufacturing as having properties similar to semiconductors in that they are labor- and engineering-intensive products.

The oft-cited economic indicator of the housing market also impacts manufacturing.

Notes McPheters, “Part of manufacturing in Arizona has been to support construction, and that’s weak right now.”

Not necessarily weak but certainly suffering from an environment of uncertainty is defense-related manufacturing, thanks to all the talk in Washington, D.C., about Defense cutbacks. Notes Macias, “We’re the fifthlargest recipient of [Department of] Defense dollars.” This impacts the long-term health of Arizona as a whole, from the standpoint not just of manufacturing but also engineering and exports, Broome explains, adding, “Aerospace and defense have to morph into commercial.”

While Broome looks at manufacturing sectors for expansion — such as getting into unmanned aerial systems and other

new products — as part of GPEC’s focus on attracting new manufacturing businesses to the Valley, Macias notes that Boeing and other big airplane manufacturers are already enjoying a huge backlog in the commercial sector. “9/11 took a hammer to the commercial aerospace field, and then the recession. This has led to a pent-up demand for new companies and existing companies needing to revitalize their fleets,” Macias says.

Finding the Work Force Filling the orders takes skilled workers, though, and this is one of the areas in which Valley manufacturing is facing challenges.

“The pipeline has dried up and the work force is aging,” says Mark Weathers, owner of Excalibur Precision Machining and president of the Arizona chapter of the National Tooling and Machining Association. “I’ve had sales I’ve had to turn away because of a lack of people.”

Observing that Phoenix has been primarily a construction-based economy and not known for its technology-based work force, Weathers notes that inadequate training is a long-standing a u g u s t 2012

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SE C TOR

Industry at Its Best

problem and what’s needed is opportunities for experience as well as education.

Many stakeholders have come together to develop an apprenticeship program to address this need. The Arizona Precision Manufacturing Apprenticeship Program is a collaborative effort of the Arizona Commerce Authority, the Arizona Tooling and Machining Association, Maricopa Workforce Connections, Phoenix Workforce Connection, several Maricopa community colleges, Excalibur Precision Machining and Modern Industries.

The value of apprenticeship, Weathers explains, is the hands-on experience along with a specific, formalized structure of classes, work experience and coaching system. Also built into the program is a graduated pay scale.

“We can’t continue to steal employees from each other,” Weathers says. “The survival of many companies is going to depend on the pipeline of qualified employees.” AzPMAP also promises to provide a big marketing advantage in terms of bringing in new companies.

Participating as part of a larger group makes a training program more affordable to individual companies, Weathers says, explaining there is a lot of overhead with apprenticeship programs. AzPMAP is an infrastructure model he notes can be used for any industry, covering “reporting, coaching, marketing, recruiting, screening – all the things the small employer would struggle to do.”

finding a qualified work force remains the topmost challenge.

But also a serious concern is being tied so heavily to the federal government’s Defense budget. The series of “continuing resolutions” that have come from the government for more than three years in place of a budget offer only short-term funding that hampers long-term business operations. “Programs have been approved but funding is released only in small increments. I have a five-year window on this; three months does nothing for me,” Macias notes.

Professor McPheters adds an even broader perspective. “Aerospace and electronics products are key exports for Arizona. Who do we export to: Europe and Asia. With the global slowdown, it’s bad for the economy.”

“Most of our economic prosperity comes tied to ports and rail access that comes out of California,” says Broome, addressing another

factor that impacts our manufacturing industry: transportation. This is one of several factors explored in depth in the 2012 Manufacturing and Logistics Report Card, a comparative report on all 50 states recently released by the Center for Business & Economic Research at Ball State University in Indiana. The center’s director, Michael Hicks, Ph.D., says Arizona is not on a connecting point for north-south or east-west trade. Noting that Arizona ranks 39th in manufacturing exports per capita, he says, “[Arizona doesn’t] have the transportation network that makes it easy … to be involved in global trade.” As important and useful as Phoenix’s Sky Harbor Airport is, Dr. Hicks explains, “Air shipment is a trivial share of commodity flow of non-human activity.” While planes move a lot of small, high-value items, “it takes a dozen planes to carry what a single train can carry.” And Arizona ranks 36th per capita on the value of goods moving by rail.

Moving Ahead Macias notes the I-11 Corridor project has been on board for several years to connect Phoenix and Las Vegas — and thus be part of a complete north-south route from Mexico to Canada. The project got a huge boost in July when the Transportation Funding Bill MAP 21 approved the designation of the route from just north of Wickenburg to the ArizonaNevada border as Interstate 11. Although no money was attached to this, it is a significant development in that it makes I-11 more than a loose concept, explains Arizona Department of Transportation spokesperson Tim Tait, noting Governor Brewer and ADOT have lobbied for this project for several years.

Concerns in the Spotlight Although acknowledging there has been an increased focus on STEM (science, technology, engineering and mathematics) education in Arizona schools and a greater general awareness of its importance, Macias believes

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“The Valley needs to make bold moves in public investment in infrastructure and science and technology,” says Broome. Noting the need to expand light rail and the 202 and 303 freeways, he says, “These are long-term projects. A lot of time, the Valley doesn’t have the patience for that.” To illustrate the value of long-term forward thinking in creating valuable infrastructure, he points to Price Road in Chandler and recalls a conversation he had with the mayor who championed its development, who told him, “People thought we were off our rocker to put this huge infrastructure in a cotton field.” “Now,” says Broome, “Price Road is one of the best hightech corridors in the U.S.” High-tech is not the only area for expansion, however. Broome sees potential in more simple manufacturing, such as food.

“Food manufacturing is interesting because

it has to be near customers; you can’t offshore it very easily,” he says. Although there is no pent-up demand to establish facilities here, he believes that companies will look at re-evaluating where they are located as machinery, equipment, buildings and facilities have to be upgraded. “Food is probably in a high-cost area, in a facility that’s 30 years old. When the facility needs to be replaced, will they stay in a high-cost area where the population is in decline?” He anticipates companies will look to the South and the Mountain West, and says, “There’s a chance we can reset for our region.”

And Macias relates that a recent roundtable by the Arizona Mexico Commission explored the potential to market the Arizona-Sonora Region as a whole for manufacture of technology products. Arizona would provide the aerospace and defense

manufacturing; Mexico, the low- to mediumcomplexity, higher volume manufacturing.

“The concept of the marketing would be ‘whatever it is you need, we can do it here,’” he says, noting that with wages rising in China and transportation costs higher, this could strengthen access to markets in North, South and Central America.

Arizona Department of Transportation azdot.gov Arizona Manufacturers Council azchamber.com/amc Arizona Mexico Commission azmc.org Arizona Precision Manufacturing Apprenticeship Program azpmap.org Center for Business & Economic Research at Ball State University cms.bsu.edu Greater Phoenix Economic Council gpec.org National Tooling and Machining Association — Arizona Chapter arizonatooling.org W. P. Carey School of Business at Arizona State University wpcarey.asu.edu

Arizona Receives ‘C’ for Manufacturing Industry Health Manufacturing nationally enjoyed a robust year as growth in many sectors accelerated from the already strong manufacturing recovery of 2010-11, but the impact varies from state to state, says a report from Ball State University. The 2012 Manufacturing and Logistics Report Card, an indepth analysis from Ball State’s Center for Business and Economic Research, grades all 50 states on how they handled critical factors underlying their manufacturing performance.

Graded on a bell curve in relation to the other 49 states, Arizona received the following grades: Manufacturing: C Logistics: C Sector Diversification: D+ Human Capital: D+ Tax Climate: B Worker Benefit Costs: C Expected Liability Gap: C Global Reach: F Sector Diversification: D+ Productivity and Innovation: C “Human capital is the most worrisome report of all these. It determines not only manufacturing performance but how you do overall,” says CBER director Michael Hicks. He shares details of Arizona’s per capita ranking relative to the other 49 states on important elements within the graded factors.

2012 Manufacturing and Logistics Report Card cber.iweb.bsu.edu/research/conexus11

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Human Capital — Educational Attainment and Performance

■■ Percent of adults with a high school degree. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36th ■■ Percent of adults with a college degree. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33rd ■■ First-year retention rate at junior college . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36th ■■ High school graduation rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41st ■■ 8th-grade math score (“This is the level that most manufacturing is testing on,” says Hicks.). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39th ■■ Total number of associate degrees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5th ■■ Under 35 years of age with an associate degree . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16th Global Reach

■■ Manufacturing exports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39th ■■ Income derived from foreign investment in Arizona. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46th ■■ Export growth. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38th ■■ Reach of investors from out of the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334th ■■ Value added (“My suspicion is they are investing most in agricultural goods, which is low value added,” Hicks says.). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47th ■■ Demand adaptability index (responsiveness to changes in the composition of foreign demand for goods). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23rd

Logistics — Transportation

■■ Value of goods moving on rail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36th ■■ Commodity basis of goods on the roads. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38th ■■ Tonnage across all modes of transportation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36th Productivity and Innovation

■■ Growth in value added in manufacturing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28th ■■ Research and development spending. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16th ■■ Patent applications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18th ■■ (“This is not translating yet to productivity,” Hicks says. However, noting Arizona ranks 24th on a per-worker basis, he points out, “This is very high, globally.”)

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ASSETS

by Mike Hunter

We Value What We Own

Accounting for It Businesses look to accounting software to do the day-to-day bookkeeping, budgeting and billing. Here are some easy-to-learn programs that include features for businesses of all sizes and types:

Sage 50 2013 This software is easy to learn and provides good quality support for users.

For 2013, there are no significant improvements, but reporting and analysis features have been refined and the 2013 version makes copying transactions easier than ever. $369 (1 user), $669 (3 users), $899 (5 users) sage.com

Bookkeeper 2012 A lesser-known and more basic option, Bookkeeper is a reliable program offered by Avanquest, a service that provides merchant services, back-up option and other products. Some features are not as extensive as other programs offered in the areas of reporting analysis and Bookkeeper does not include many e-banking options, but for a small business and for the price, this can be a best option. $39.95 per user avanquest.com

Powerful and Efficient: All-new Cadillac XTS

With a rocky economic climate over the past few years, it is no wonder that carmakers are looking for an edge when it comes to luxury. A time of substance has meant that frills are gone. The engineers at Cadillac have created a vehicle that has proven to be luxurious, efficient and priced right.

Replacing the DTS, Cadillac’s larger “town car,” the XTS is a new generation conceived in a new size, with new technologies and fuel efficiency. CUE is the new on-board infotainment system that is fast and responsive and mimics the smartphone userabilities many have come to rely on. A touch screen makes controls convenient and easy to navigate, integrating devices through Bluetooth technology to sync contacts and more. Voice activation and a configurable instrument panel make this new high-tech dash the new “mobile” device.

Not necessarily disappointing, the DOHC 24-valve V-6 with direct fuel injection boasts 304 horsepower and 264 lb-ft of torque. No lightweight, but not the beasts of the past. Getting any real power is an effort, but it does perform in a pinch. The six-speed automatic transmission is reliable and goes virtually unnoticed. A manual shifting mode will have to suffice for any “sport” setting as there is no performance-empowering sport mode tightening the suspension or enhancing the power shifting.

It is all about style and design. The XTS exterior “sculpted” shapes and “carved” lines are impressive and will get drivers noticed. With low-profile 19-inch wheels standard, the look is more racing than this class has seen in the past. The interior is elegant and plush beyond the gadgets that enhance the forward cabin. Leather seating and trim, ambient interior lighting and substantial rear legroom mean that, like the DTS or the Deville, the XTS is a strong candidate for the livery vehicle. The available 14-speaker Bose Studio Surround Sound system is notably pure quality sound that is a must option. The Ultraview Sunroof spans both the front and rear seating areas and provides options for light, air and a near-convertible feature.

Available in standard, luxury, premium and platinum versions, the XTS offers options that are mostly cosmetic. However, the new era is evident 2013 Cadillac XTS in luxury combined with efficiencies and the latest technologies, and Cadillac has gotten it right with the City MPG . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Hwy MPG. . . . . . . . . . . . . . . . . . . . . . . . . . . 28 all-new XTS.

0-60 MPH. . . . . . . . . . . . . . . . . . . . . 6.7 sec Transmission. . . . . 6-speed automatic

QuickBooks Pro 2012 A most-reliable software for the do-it-yourself accountant, QuickBooks has always performed.

New collections features, e-mail interface and more powerful search tools make navigating a business’s information easier. Various retail products through Intuit make this choice a potential “all in one” option. $189 to $800-plus (1–3 users) quickbooks.com

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Photos: Sage, Avanquest, Intuit (left, top to bottom), General Motors (right)

MSRP. . . . . . . . . . . . . $44,995 – $59,080

by Mike Hunter

Meals that matter

Power Lunch

Go Ethnic and Taste Broader Horizons Make lunch exciting with these ethnic Valley favorites for lunch.

Fogo de Chao — Brazilian Gaucho chefs provide more than 15 cuts of fire-roasted meats tableside for diners to choose from. Hit the salad and sides bar for more than 30 vegetable and sides dishes to enhance the experience.

6300 N. Scottsdale Rd., Scottsdale (480) 609-8866 • fogodechao.com

Golden Buddha — Chinese

Photos: WM Sacks (top); Fogo de Chao (bottom)

WM Sacks: Business Success Makes for Tasty Lunch

Chances are when you think about what to do for lunch, you think about Sack’s.

At one time or another, with or without clients in tow, lunch-goers stop in to have one of the best sandwiches money can buy.

WM Sacks Art of Sandwicherie is just that — a virtual sandwich factory that is all about making the best combinations of breads, meats, vegetables and condiments.

Original recipe soups and salads that are inventive and incredibly tasty make up this menu. Open from 8 a.m. to 3 p.m., Sacks is really only about noontime fare. Wanda Morrow, the founder, believes in good, healthy food made with quality ingredients that are affordable. Since she opened her first location in 1985, this has caught on as she now has four locations in Tempe and Phoenix.

Art and artists are the inspiration of the signature sandwiches aptly named, from the Sacks Symphony (a sandwich of turkey breast, bacon, avocado, tomato, alfalfa sprouts, cream cheese and mayo on 12-grain bread) to the Sacks Van Gogh (a concoction of rare roast beef, fresh dill, Havarti cheese, alfalfa sprouts and Sacks special deli mustard on pumpernickel bread). The Picasso is a hot sandwich made with four meatballs, provolone cheese and Mama Cosenza’s Original Italian Sauce, all on an 8-inch baguette.

The Tuna and Chicken Salads are made fresh and are recipes that will not be forgotten, and can be ordered as a sandwich or as a “salad” by themselves. Each order comes with one of Morrow’s famous cookies.

Not a place for that important client meeting, Sacks is all about getting in and out with a great meal. Eat-in or take-out and delivery are the options. Catering for that corporate meeting or working lunch is available, but get orders in early as each of the four locations is packed with hungry customers (all of whom are likely back for more).

Crowded but well organized, this Sandwicherie is a Valley staple that is also a business success story.

Try the exotics like the Chicken & Shark Fin Soup, Jellyfish or some great Mandarin and Cantonese favorites. In the COFCO Center, this is a place to get your Chinese fix. Dim sum served daily.

668 N. 44th St., Phoenix (602) 286-9888 • goldenbuddhaphx.net

Indian Delhi Palace — Indian Spice up lunch at this authentic Indian restaurant. Décor, food and even a spice store on the premises will give patrons more than just a “taste” of India.

5104 E. McDowell Rd., Phoenix (602) 244-8181 • indiandelhipalace.com

Rúla Búla — Irish No, this is not the time for beers or whiskeys — have some of the authentic Irish foods like the Shepherd’s Pie or the Irish Bangers & Mash. It’s not only filling but an eye-opener to something other than a great draught.

401 S. Mill Ave., Tempe (480) 929-9500 • rulabula.com Fogo de Chao

WM Sacks Four Valley Locations sacks.info

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Celebrating more than 25 years of serving the women business owners of Phoenix

Summer 2012 • nawbophx.org

President’s Message About NAWBO

NAWBO® prides itself on being a global beacon for influence, ingenuity and action and is uniquely positioned to provide incisive commentary on issues of importance to women business owners.

NAWBO Phoenix propels women entrepreneurs into economic, social and political spheres of power.

Visit one of our FREE welcome meetings, held the second Wednesday of each month – for all new and prospective members. This casual, informational opportunity highlights both local and national benefits of NAWBO membership. This is a great place to determine if NAWBO is a fit for you and your business.

Take advantage of this great networking opportunity by bringing business cards and making connections.

A Special Social Media Edition

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Social media plays a vital role in networking and building relationships. The importance of understanding social media and utilizing it well cannot be underemphasized in business today.

As a founder of a networking organization myself and as a trainer/mentor, building relationships is at the core of my own business; but until just a few years ago, this was mostly done through face-to-face contact, phone calls and emails. Social media for business is just a few years new to everyone, and it is a powerful way to reach more people than ever before.

How networking and relationships are built today may not feel different to business veterans, but to the new generation of entrepreneurs, these efforts are not successfully executed without a strong, strategic and active social media plan.

Business veterans take note; if you want to build relationships with the younger generation or take your business outside of your base geographic area, you will need to engage through social media. Technology is changing the way we communicate. The opportunity to connect with other businesses around the world is now available to everyone right at the tips of their technological device.

Part of NAWBO’s mission is to support our members and business community at large with resources and leading edge education to make it easier to continue to grow with the changing business landscape. We are proud to bring you some of the top local experts this month to help bridge the gap and simplify the learning curve of how to effectively use social media for business purposes. Some important tips I have learned through my NAWBO connections include: • Keep your messages simple and conversational (the focus is on building relationships, not selling).

• Ask questions and engage others to share.

• Use photos and video. Make yourself as human and approachable as possible.

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I know you will learn even more in the following pages. Enjoy!

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To your success,

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Lynda Bishop NAWBO Phoenix Chapter President 2012-2013 Summit Alliance Solutions summitalliancesolutions.com

For more information, please visit NAWBOphx.org.

Phoenix Metropolitan Chapter of the National Association of Women Business Owners 7949 E. Acoma Dr. #207 Scottsdale, Arizona 85260 480-289-5768 info@NAWBOphx.org

This issue Pinterest for Business Building Your Brand with Social Media Drive Traffic to Your Website Using Social Media Nine Things Businesses Have Learned About Social Media and more...

nawbophx.org

Lynda Bishop President, NAWBO Phoenix

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NAWBO NEWS

for Business

By Kristi Trimmer

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NAWBO NEWS

Orange Dragonfly Media OrangeDragonfly.com Years as a NAWBO member: 1 Years in business: 2

Pinterest started in 2010 and has grown to almost 10 million users. It’s most easily described as a visual bookmark – it’s quite beautiful. The site is based on pin boards and gathering like items together in one place. Pinterest allows the user to repin items from other users’ boards to one of their own boards, as well as upload their own pins, or create pins from other websites. What drives Pinterest is not just the pins, but the embedded links on the pins. If a pin is pinned correctly a user should be able to click on that pin and go directly to the source website. It is very frustrating for users when they find a picture of a recipe they love and the link doesn’t take them to the chef’s website, but rather to an image on Google.

Kristi Trimmer Making Pinterest work for your business is fairly simple. It doesn’t take too long to set up and is pretty user friendly. When you set up your Pinterest account, make sure your username is your business name to make it easily identifiable. The set up process is very easy to follow.

Search engines cannot index images for Search Engine Optimization of a website. Pinterest cannot index images either. The description must contain what you want users to find when they are doing a search. There is room for 600 characters, but try not to use more than 160 characters on a description.

Do’s and Don’ts of Pinterest for Business Do’s:

• Reveal more about your brand’s personality than your actual product line: Pinterest is heavy on storytelling. Your followers should know the story behind you, the business, and the products or services your business creates.

• Make several boards with at least 5 pins each: Having just one board is boring and not engaging. Try having a board for each staff member as a way to get to know the team better, photos you personally find inspiring, special events your company participates in, community involvement boards, and even a press board. Get creative with your boards. Remember tell a story. Pinterest is not the place for direct marketing.

• Create group boards: Create group boards that allow multiple users to post images. This allows customers and fans to post pins of your products, how they use them, or what inspires them.

Don’ts:

• Don’t get carried away: Much like your follows don’t want to see 10 mundane tweets or Facebook posts in a row from you, they also don’t want to see 30 pins in a row. Try to pin a couple things at a time and then come back to pin more.

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• Before you pin it, make sure it links back to the source: As mentioned earlier, there is nothing more frustrating than clicking on that recipe you want to try and not finding any more information on it. Also make sure you install the Pin It plug in to your tool bar.

This allows you to pin directly from websites you visit throughout your day.

• Be social and develop relationships: Especially with other businesses, repin your follower’s pins; comment on their pins; like their pins. Interaction is key. People want to know there is someone behind the account.

• Make the most of your time: Best times to pin are between the hours of 2-4pm and then from 8pm-12am, and also on Saturday mornings.

• Know your audience: About 75 percent of Pinterest users are women between the ages of 25 and 54.

• Don’t directly market through Pinterest: This is against Pinterest rules and is just not a good strategy. Remember – tell a story. If you have seasonal items coming up, feel free to pin those to a pin board, but don’t get carried away with it. Indirect marketing is key. Allow the stories to market for you.

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NAWBO NEWS

Building Your Brand with Social Media

By Dorothy Wolden

Connecting with the vast audience of the social Web is a low-cost way to catapult a small-business brand onto the global arena. Building your brand using social media allows you to develop new (and strengthen existing) relationships, which often leads to everything from brand awareness, loyalty and word-of-mouth marketing.

Follow these five steps to get you on your way to building your brand and boosting your business.

Dorothy Wolden 1. Create branded online destinations: Use the popular, free options like blogs, Twitter, Facebook, LinkedIn, YouTube, Pinterest and so on. Of course, for small-business owners without the manpower to effectively manage too many destinations, you should consider testing each of these to determine which social media service you’re most likely to stick with over the long haul.

2. Establish entry points: One of the most important aspects to accomplishing this with your branded online destinations is to continually publish meaningful content that adds value to the reader’s experience. The goal is to publish useful information people will want to talk about — and then share with their own audiences.

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NAWBO NEWS

3. Locate your target audience and bring them back with you: Where does your target audience already spend time? You need to spend time in those places, too, and engage in the conversations happening there.

Join relevant online forums and/or blogs, write posts, publish comments and answer questions. Once that audience understands you are there to genuinely offer useful information and not to self-promote, you can start leading them to your own branded destinations.

4. Connect with influencers: As you search for your target audience, you should identify online influencers in those communities and get on their respective radars. To do so, leave comments on their blogs, follow them on Twitter and retweet their content. You can even email them to introduce yourself.

5. Give more than you receive: Success in social media marketing depends on being useful and developing relationships. If you spend all of your time promoting then no one will want to listen to you.

It’s a long-term strategy that Dorothy Wolden can deliver sustainable, organic Creative Intuition • cistudio.com Years as a NAWBO member: 3 growth through ongoing, Years in Business: 10 consistent participation.

Drive Traffic to Your Website Using Social Media

By Lisa Bhella

Driving more traffic to your website and ranking higher in the search engines is a frequently heard topic of conversation amongst business owners. Businesses want more of both and many are not sure how to get it. More traffic means Lisa Bhella increased opportunity for consumers to read about your services and products, in hopes of making a purchasing decision and telling others how fabulous you are.

One way you can achieve this is by using backlinks (incoming or inbound links). Having links pointing back to your website raises the opportunity of ranking higher in the search engines, creating leads and expanding the

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awareness of your brand. Social media is one of several strategies used to increase the number of backlinks.

However, do not forget that your social media needs to be well…SOCIAL. That means installing shareable buttons on your website, for example, after every blog post. You want your online content shared with your target market, so you can establish yourself as an industry expert and the “go to” site for relevant content.

Install the main social media platform buttons – Twitter, Facebook, Google+ and LinkedIn, and review how many shares you have. This will also help you hone in on the type of content that creates more shares. More shares mean more people knowing about you.

It is also important to test and measure your social media efforts using an online tool such

as Hootsuite or SocialOomph. Reviewing your social media analytics will help you focus your efforts on the platforms that are working for your business. Remember you need to be where your target market talk, listen and share online.

A good social media strategy needs a foundation, planning and allocated resources in order to be an effective tool in the marketing toolbox. It should be integrated into your marketing strategy and goals. Like a garden, it will need looking after and tending to frequently.

Lisa Bhella INBOX2OUTBOX, LLC inbox2outbox.com Years as a NAWBO member: 5 Years in Business: 5

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NAWBO NEWS

Benefits of Social Media and NAWBO

By Kristin Slice

Every membership organizations emphasizes you must get involved to receive the most benefit from their organization – which is true. Social media makes it easier for members to be more engaged. The National Association of Kristin Slice Women Business Owners integrates social media and marketing in a way that allows members like myself to learn more about my fellow members, to advocate for the organization and to expand my own business opportunities all at the same time.

I was asked to submit an article for the NAWBO newsletter regarding my experiences as a young women business owner. The newsletter was published on the NAWBO Facebook page, which allowed others to read and share the article. And share they did. Over

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the next several days I was able to connect and gain exposure to several NAWBO members and non-members across the Valley. They encouraged me to submit the article to NAWBO National. One short email later, it was submitted.

I was shocked to see my article published in the national newsletter a few short weeks later. What came next was even more exciting.

I received an email from the NAWBO National president asking me if I would be interested in speaking at the 2012 Women Business Owner National Conference this October. A word of advice, do not open exciting emails in the middle of Paradise Bakery – I created a little bit of scene. I have been fortunate enough to speak at several local groups and organizations, but speaking for the largest group of women business owners in the country is a huge opportunity. While the topic of my article was young women business owners, they asked me to speak on the topic of social media

for small businesses. As a social media strategist, I am thrilled to have the opportunity to discuss my business in front of a national audience.

Through the support of NAWBO members and utilization of social media, I gained the confidence needed to submit the article, which led to a national opportunity I never thought possible. The combination of a quality organization like NAWBO and social media is a powerful tool for business owners to expand their horizons further than they thought imaginable.

Kristin Slice, MA Three Dog Marketing threedogmarketing.com Years as a NAWBO member: 1 Years in Business: 2

Nine Things Businesses Have Learned About Social Media Be Less Like a Brand and More Like a Human

By Lyndi Thompson Social media and online marketing specialist lyndiT.com

Social media has walked the fiery coals of skepticism and has brilliantly performed as a marketing, customer service and relationshipbuilding tool beyond expectations.

Businesses of all sizes have taken this plunge into what initially felt like a foreign way of communicating with their customers. When businesses began using Facebook and Twitter, engaging on forums, blogging, creating videos on YouTube and more, they realized that being less like a brand and more like a human creates long-lasting relationships with customers.

Here are a few things businesses have learned about social media: It Isn’t Free: Social media costs time—a lot of time. If you have someone who is customer focused, understands how to write headlines and reaches out to the right audiences, you are starting out solid.

Be Creative: Social media isn’t sell media.

Be social. Have fun engaging your community, from congratulating them on opening their new business, to commenting on their blog and

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attending networking events with them.

A Team Approach: This isn’t a one-person show. Just like customer service, everyone needs to be trained and have at least a basic understanding of how to help customers sell the product as well as assist with their concerns.

Start With Employees: The people who know how to talk about your brand, company and culture the best are your employees. Treat them like family and acknowledge and appreciate them—make them feel like they are an important part of your business. Employees are the first to share with their communities and network their experience with your company and brand.

Listen First: Enough with the megaphone blasting your message to customers and employees. Start by spending some time listening to them instead. Reach out and connect with your customers, employees and fans of your brand and make them feel that they are the center of the conversation.

Customers Turn into Marketers: Customers who feel acknowledged and appreciated are

loyal, excited to help and eager to be your brand ambassadors, at no charge.

Consistency Matters: Have your graphic designer help you create a Twitter background that matches your website branding and a Facebook logo that fits into this look as well. It’s the little things that your graphic designer can do to enrich your company’s image that make all the difference.

Connect Online and In Real Life: Find ways to connect offline. Have an open house, attend a networking event and then share the experience with your social media communities.

Seek Guidance: Look for someone who not only understands the website tools and language, but has experience and passion working with social media to give you a quick webinar or in-person demonstration. Learn about social media management tools, ways to monitor effectiveness, help with content strategy, locate your target audience and much more.

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NAWBO NEWS

NAWBO PHOENIX Corporate Partners Presidential Corporate Partners SRP State Farm Insurance Strategic Corporate Partner Alliance Bank of Arizona National Bank of Arizona Presidential Media Partner Media88 Executive Corporate Partners Benefits by Design Kolbe Corp Merrill Lynch Wealth Management Snell and Wilmer Southwest Gas The New Well Wal-Mart Strategic Media Partners KFNX Radio 1100 AM Creative Intuition Networking Phoenix.com Executive Media Partner Arizona Capitol Times CITYSunTimes Despins Printing Easel Photography InBusiness Magazine Money Radio 1510 AM Business Corporate Partners APS Bank of Arizona Benjamin Franklin Plumbing Border States Electric Orchard Medical Consulting Schmeiser, Olsen & Watts, LLP The Car Source Wells Fargo

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Get social with NAWBO Phoenix Utilizing NAWBO’s social media presence not only allows you the opportunity to engage with fellow women entrepreneurs, but also find out what is happening at NAWBO Phoenix.

Through our social media outlets, you can learn about upcoming events, speakers, mentorship opportunities, community service opportunities and more, while being able to engage in forums and other topics with NAWBO members.

Whether you are a NAWBO member or not, you are able to follow us on Facebook and Twitter – for those of you who are not yet members, you may like what you see and want to join us! The benefits of NAWBO membership are abundant. NAWBO is also on Linked In, a private group for our members providing a place for collaboration and connections in a platform that allows members to connect beyond our events.

You can find links to all of our social media accounts on our website at nawbophx.org or go directly to our Facebook account at facebook.com/NAWBOPhx and Twitter account at twitter.com/NAWBOphx.

NAWBO Board of Directors Executive Committee

Board of Directors

President Lynda Bishop Summit Alliance Solutions, LLC

Director of Communications/ Media Relations Martha Knight Arbonne International

President-Elect Jackie Wszalek Despins Printing & Graphics Finance Director Julie Kern, CPA, CFP, Bridge Financial Strategies Secretary Nancy Sanders Three Dog Marketing Immediate Past President Kristine Kassel Benefits By Design, Inc. Director of Administration Suzanne Lanctot NAWBO Phoenix Metro

Directors of Corporate Partners & Economic Development Amy Bruske, Kolbe Corp Kristine Kassel Benefits By Design, Inc. Director of Membership Services Magaly Masci Masci Wealth Management MSSB Director of Social Media Kristi Trimmer Orange Dragonfly Media Director of Programs Colleen O’Shaughnessy MetLife Program Co-Chair Kristin Slice Three Dog Marketing Director of Public Policy Ginger Lamb, Arizona News Service/Arizona Capitol Times Awards Chair Marnee Weber The Caregiving Coach Award Co-Chair Katreena Hayes-Wood Career Services Network

Ambassadors Chair Phaedra Earhart Farmers Insurance Community Alliances/ Diversity Chair Barbara Appenzeller, CPA, Appenzeller & Associate, CPAs, P.C. Community Service Chair Melanie Dunlap, Peaceful Spirit Enrichment Center Events Chair Ginny McMinn McMinn Business Solutions Honorary Advisory Council Chair Cynthia Wrasman MJC Solutions, Inc. Mentor Program Chair Pamela Smith Numbers Etc. Mentor Program Co-Chair Cheryl Skummer Meridian Payment Systems NAWBO University Chair Dorothy Wolden Creative Intuition Neighborhood NAWBO Chair Connie Zimmerlich ClickChick Photography Retention Services Chair Joan Laubach Your Wealth and Health Women’s Enterprise Foundation (ex-officio) Jill Workman Wicked Wicker, LLC

Index Index by Name

Flaaten, Anna, 10

Miller, David, 14

Vukovich, Lisa, 12

Bangguo, Wu, 20

Hicks, Michael, Ph.D., 35

Nielsen, Eric, 9, 20

Weathers, Mark, 35

Betz, Pam, 28

Hoffman, Denis, Ph.D., 10

Owens, Erin, 12

Widdows, Matt, 18

Bhella, Lisa, 45

Huckabay, Eric, 14

Qualman, Erik, 27

Williamson, Glenn, 10

Bishop, Lynda, 41

Keenan, Vince, 20

Sahlin, Doug, 27

Wilson, Kristen, 29

Brewer, Jan, Gov., 20, 35

Krupp, Steve, 32

Slice, Kristin, 46

Wolden, Dorothy, 44

Broome, Barry, 35

Lane, Jim, Mayor, 20

Stanton, Greg, Mayor, 20

Zimmerman, Jan, 27

Bruhnke, Doug, 20

Macias, Steve, 35

Tait, Tim, 35

Cardon, Don, 20

Mainwaring, Simon, 27

Thompson, Lyndi, 47

Dickinson, Karen, 20

McPheters, Lee, Ph.D., 35

Trimmer, Kristi, 42

Dozer, David, 20

Mendelson, B.J., 27

Valentino, Mark, 28

Index by Company

E-Women Network, 30

PGA Golf, 3

Three Dog Marketing, 46

5 Arts Circle, 4

Excalibur Precision Machining, 35

Pivot Manufacturing, 35

U.S. Commercial

Ahwatukee Foothills

Expect More Arizona, 33

Quarles & Brady, 20

Fogo de Chao, 39

QuickBooks, 38

US Airways Center, 7

FordHarrison, 12

Rúla Búla, 39

W. P. Carey School of Business, 10, 35

Frito Lay, 35

Sage, 38

Wells Fargo, 19

Fuchsia, 12

Salt River Project, 11

West Valley Women, 31

Golden Buddha, 39

Satrix Solutions, 15

WM Sacks Art of Sandwichery, 39

Greater Phoenix

Standing Committee of China’s

Women of Scottsdale, 31

Chamber of Commerce, 30 Alerus Bank & Trust, 15 Alliance Bank of Arizona, 2 Amerishore, 14 Arizona Businesses Advancing Sustainability, 29 Arizona Chamber of Commerce & Industry, 29, 30 Arizona Commerce Authority, 20 Arizona District Export Council, 9, 21 Arizona Hispanic Chamber of Commerce, 30 Arizona International Growth Group, 20, 30 Arizona Manufacturers Council, 35, 29 Arizona Mexico Commission, 35 Arizona Precision Manufacturing Apprenticeship Program, 35 Arizona Small Business Association, 29, 30 Arizona State University, 10, 35 Arizona Technology Council, 30 Arizona Workforce Connections, 12 Avanquest, 38 Avnet, 20 Ball State University, 35 Beyond A Strategy, Inc., 50 Blue Cross Blue Shield of Arizona, 17 Brightway Insurance, 14 Cadillac, 38 Center for Business & Economic Research, 35 Central Phoenix Women, 30 Chandler Chamber of Commerce, 30 Crabtree, Rowe & Berger, P.C., 30 Creative Intuition, 44 Decision Strategies International, 32 Driver Provider, The, 19 Economic Club of Phoenix, 30 Epilepsy Foundation of Arizona, 28

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Chamber of Commerce, 30 Greater Phoenix Economic Council, 35 GrowAZ, 12 Growth Nation, 20 H. A. Mackey and Associates, 8

Service Arizona, 9, 10, 20

National People’s Congress, 20

YouTube, 12

Surprise Regional Chamber of Commerce, 31 Tempe Chamber of Commerce, 31

Bold listings are advertisers supporting this issue of In Business Magazine.

Holmes Murphy, 4 HomeSmart International, 18 Hon Kachina Council, 28 Honeywell, 20 Ignite Phoenix, 12 INBOX2OUTBOX, L.L.C., 45

Download Us Now www.inbusinessmag.com

Indian Delhi Palace, 39 Infrared Laboratories, 20 Intel Corp., 35 JPMorgan Chase Economic Outlook Center, 35

/inbusinessmagphx @inbusinessmag

L. William Seidman Research Institute, 10 Left Brain Digital, 26 Maricopa County Attorneys Office, 8 Maricopa Workforce Connections, 13

It's a Hub to Building Business

Mayo Clinic, 52 National Association of Women Business Owners, 30, 41, 46 National Bank of Arizona, 5 National Tooling and Machining Association, 35 Nest Ventures, L.L.C., 10 Neudesic, 14 North Scottsdale Chamber of Commerce, 30 NUMBERSetc, 45 Omni Hotels & Resorts Tucson, 51 Orange Dragonfly Media, 42 Peoria Chamber of Commerce, 31

a u g u s t 2012

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Roundtable

A Candid Forum

The Life, Death & Rebirth of America’s Global Leadership We need to refine our skills, adjust our mindset and modify our direction

by Mona Pearl One of the main challenges of the U.S. economy is mind-set. As trade borders become seamless and the world becomes more dependent on technology, U.S. companies and their executives must scramble to acquire the tools and skills necessary to survive and thrive in the increasingly competitive global market.

The basic reason for our nation lagging behind and suffering from a negative recovery, and a much slower one than other nations, is our own unwillingness to play in the sandbox with the other nations in this new economic order.

Or, is it that we are so spoiled that we don’t know how? This is not about simply leading the world when there is no competition, the way it used to be. The point is that the power in the world has shifted and we are no longer alone at the top. A number of nations have emerged and taken a portion of our place in the limelight, so we now need to learn to collaborate instead of dictate. We are a valuable leader, but not the leader of everything anymore. Is it arrogance? Ignorance? Or a bit of both?

Historically, the U.S. has been the leader in the world’s economy.

As we enter the second decade of the 21st century, that position has changed. We’re not even second or third! According to the 20102011 Global Competitiveness Report, the U.S. ranks fourth, behind Switzerland, Sweden and Singapore.

Former Secretary of Commerce Gary Locke, speaking at the Cardinal Health, National Export Initiative Rollout Event in 2010, stated that 95 percent of consumers are going to be outside the United States in 10 years: “With traditional drivers of U.S. economic growth like consumer and business spending facing stiff headwinds, it has never been more important for our companies to increase their sales to the 95 percent of the world’s consumers who live outside the United States.”

In addition to changing players, the game itself is changing with emerging transnational issues such as changing climate; growing demand for energy, food, and water; and an aging population in the developed world. Individually, any one of these emerging issues would change the nature of global business play. Combined, these issues promise to turn the playing field upside down in what could be a historically unprecedented age of prosperity, especially for those who develop solutions for these and other global issues. These solutions will be the foundation for continued global prosperity.

What is our competitive advantage?

We used to have our education system, entrepreneurship, drive and free spirit as our competitive advantage. We still have it. The U.S. is still the place where people from all over the world come to learn in our educational institutions and to copy and perfect our entrepreneurship models, but what cannot be transferred is the spirit of America. The

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spirit that everything great we did was built on. How about starting with this competitive edge and building on it?

While it is tempting for U.S. businesses of all sizes to focus and dwell on the many overwhelming issues of the day, such as weak economic growth at home, an uncertain credit crisis, a shrinking pool of skill and talent and increased foreign competition, the fact remains, these issues are not within the control of corporate management. Instead, corporate leadership must take one large step back and look into the global marketplace to discover new opportunities and new avenues to generate future growth. While larger corporations have more resources to invest in exploiting these new opportunities, smaller companies are more agile and can more readily adapt to change.

Be fast, flexible, innovative, motivated and enjoy the adventure! It’s a big world out there with lots of potential for the ones with a keen entrepreneurial spirit. The American way!

Mona Pearl is a global strategic business development expert (www.monapearl. com) as well as the founder and COO of Beyond A Strategy, Inc., a company providing expertise to plan and implement cost-effective and sustainable global growth that improves a company’s bottom line and helps realize seamless international operations. She is also the author of Grow Globally: Opportunities for Your Middle-Market Company Around the World, has been quoted as an expert

by CNBC, The Globe and Mail, Oracle and Chicago Tribune, among others, and regularly publishes columns on global competitiveness in industry magazines, including Management Today.

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After a heart transplant, I feel lucky to be here. My answer was Mayo Clinic.

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