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N o v e m b e r 2013
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G IN H EN NT PP O HA IS M TH
LUNCHEON • PANEL • EXPO FRIDAY, NOV. 15, 2013 2013
Join us for lunch and our Economic Symposium with our extraordinary panel of top business executives in the Valley. Confirmed panelists include:
Executive Vice President National Bank of Arizona
President and CEO GPEC
Jerry Colangelo Principal Partner JDM Partners
Superintendent of Public Instruction State of Arizona
Elliott D. Pollack
CEO Elliott D. Pollack and Company
Donald Smith President & CEO SCF Arizona
CEO OneNeck IT Services Corp.
Candace D. Wiest
President & CEO West Valley National Bank
Host, “Arizona Horizon” KAET Eight
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The New Employee: Veering from the Traditional
As businesses have begun ramping back up into a slowly recovering economy, filling job positions is turning out to be a challenge. RaeAnne Marsh talks with recruitment specialists, economic development professionals, business owners and HR experts to get a picture of the multiple factors businesses deal with in attracting and retaining talent. Departments
9 Guest Editor
David Bruno, managing director of DHR International’s Phoenix office, introduces the “New Employee” issue.
16 Commercial Real Estate as Investment 10 Feedback
Noted business and community leaders Georganne Bryant, Clate Mask and Mary Ann Sturm respond to IBM’s burning business question of the month.
Offering insights from his experience as a senior banking executive, Dan Nillen discusses best practices for managing a commercial real estate portfolio.
24 11 Briefs
24 Exploring Public Procurement in Arizona
Addressing the potential for lucrative and reliable business, attorneys Kiersten Murphy and Laura Antonuccio explain what public procurement is, how it works and why a company should explore public contract opportunities. Special Sections
35 Arizona Leadership
GREA T 2013
In-depth on Arizona’s innovative leadership collaboration
57 Arizona Technology Council
A LEA DRSHIP
AdvAnT AgE AMBER
– Feb. 2O14
My first State of the City Addres Novem s ber 2012 in a chanc was e to on Tempe reflect ’s and plans goals as our comm unity moves forwar d toward thriving a Counc future. il has I spoke about worke econo how our mic times d to prepar City poised and predic e Tempe for signific for better ted that confid ant econo we were ent that our anticip mic growth bring returns on investm ated succes . I was – especi ses would ally our ent for everyo My second residents. ne involve State an opport d of the unity City to Since last Novem express how Address will be annou far we ber, we nce have have come. with big and welcom been honore e excitin names d to these g new and great annou ventur of three plans. nceme the City nation The highlig es al hubs Consid of Tempe nts came ht of on May for the er these that our and its insuran 24, when constr projec comm partne ce giant. uction t numbe unity comm rs reveale will be ercial rs: $600 five buildin value; nearly d home develo center to the gs; two two million million Arizon pment on the square largest a parkin southe square Univer feet of and Sunbe State Univer in Arizona’s g garage ast corner sity, entitle retail feet; history plaza sity, Ryan s; up lt Holdin space; next to . develo site at of Mill to 60,000 d USA Comp gs will and a Town pment Tempe and anies 10-acr develo It’s an Lake. will feature Place. The Town and a Rio Salado e public p a 20-acr unprec Lake 30,000 have edente a 330-ro $350 million on the e -squar untold plannin be leased Parkway, d develo north om luxury e-foot benefi west g for expec side of pment to State ts for confer of Rural the site hotel ted to compo that will our comm Farm serve also include ence center nent, quality and will Road. It will as a catalys unity. as well busine When s a reside . The It becom as office The Tempe compl Arizo t for more is The City ss growth. ntial eted, could nae one Chamb highit is expec and retail Technolo has also Mayor bring State space er of Comm some Mark ted that Univer been . every gy 300,00 Mitche workin sity Tempe year. erce USA Place Coun 0 people ll’s State in conjun g with develo Missio cil:to The Arizon p a hotel The State of to Tempe ction a The mayor n Palms Hotel, the City with Voic confer Farm center e of ence hub and 60 E. th Address Thursd the City of will share vision are the 5 Tempe for the hotel in bringin just a couple ay, Nov. Technolo his though St. is please confer 21, from of g This event growth and ence new ts on the d to presen recent Othersgy Indujobs future the local 7:30 to provid and develo politica succes include stry t 9 a.m. social es a valuab of Tempe l leader ses GoDad Bank, pment at the and econo s of the memb Wells dy, Direct le opport and Arizon to Tempe Fargo, ers. The mic climat Valley. a. residen unity Energy . Tickets event registe to enjoy tial projec AMC Theatr e along , Union include Public Policy are $50 r at www.t Nov. 2013 a acted e and with his s breakf …Pag for Tempe breakfast in Februa ts. In additio severa empec State – Feb. with civic, l n, the SciTec ast and the e 2 Chamb of the west hambe aztechcoun 2O14 City Counc of Town ry to lease City is Airpor busine r.org.h Festiv er memb public 106 t; Gold presen ss Lake al…Pa is compl cil.org il ted by for a future acres of city sponso additi and Public ex that ge 4 invited to attenders andIn$70 Edwar r: Silicon Job Fair… Affairs land of the could foron to office d Jones . Learn Page , Centu bring Arizonnon- serving as What do Valley Comm buildin 6 . Platinu as many ryLink Bank; a Techn these g unicat presid began more and you? m sponso , Ryan Silver ions and as 6,500 ent and new develo a First, ology sponso Comp they CEO r: PhoenTechn two-year Counc Southw jobs. pment yard. term il, I recenmean ix Sky ology est Airline anies US, Inc. rs: Arizona s mean goodtaxes as chairmThey HarboCounc State which jobs .right tly to and taxes an also mean s; and Becau r ils of is comp Te m p e Print sponso SRP; Coppe University salesto advoc se it isn’t in our North thatof the taxes Chamb counc Office rised back the assets r sponso Ameri pay for the andate r: AlphaG e r. o r g of nearly ils represof to exten permanent ca proper an annua we(TECN service The Arizon raphictechnrs: APS, s we l ty d the , we have techn maintaA), provid s at Elliot ology Coxenting moreis to50build basis. R&D convi is Arizon a Techn ology in. Our e andWe a better Counc than 16,000 States tax credit andcompanies nce reflect alread future Congr il’s , Canad Kyrene associ a’s premie ology Counc ing tax y are over memb for on ation credit priorityess to a and . throug r trade Tempe il worki the past are hout There er fight techno for scienc make so we , and year, is much Finland. off to the an excelle logy compa it a perm ng to United whendon’t e and work it isfor clear it every have to do nt start. to build anent nies. ARIZ to go in We’ve that weyear my new lastin back ONA
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or two. also been role and LEAD as I RSH and the IT ership One Renai worki trade s for ng with IP a bill group FORU assoc 2 N. Centra ssance calledM . SomeT e the Congr the Startu iation Comp ess pe Ch of mthose partn l Ave., Square Phoen ers a m b comp ix, Arizon Suite TIA on e r a danies that are p Act. It Phone 750 invest on Capito can be found va N Ta would : 602-34 a 85004 ing Fax: 602-34 l Hill allow G e pre-revenue 3-8324 tax credit in R&D TECN while and heavi 3-8330 A urges as info@a s to apply earnin ztechc their to endor lawma ly g federa payro ouncil kers l R&D ll taxes those credit .org that can se public policy incom Tucson s agains when e taxes. benefi they t Offic The Unive reach don’t Anoth ing indus t our farhave er area rsity e Scienc Memb any of One issue try. ers face of focus is 9040 e and TechnArizona S. paten paten resea is t reform (near Rita Road, ology Park t trolls many paten rch and I-10 and Suite t issues who are . societ devel Steven Tucso 1150 Rita , includ opme y. When not addin n, Preside G. Zylstr ing Phone Arizona Road) produ tax credit nt (R&D a comp 85747 ct to : 520-38 Arizona nt and CEO, a, any wantsg any value s desig ) Fax: 520-38 Techno 2-3281 it develo the marke stimu to to take logy Council late R&D ned to tplace 2-3299 tucson ped the its , it can’t someo of U.S. @azte activi origin ne has chcou comp ty even al conce ncil.or anies paten reduc pt becau though TECN g qualif ted by ing their y for se create A also is workiaround the of qualifi the credit costs. Comp after-tax comp a State ng with any. anies can deduc idea is ed resea of the Comp base Indus to rch expen t 20 percethat amou try repor TIA to will measucreate indivi nt from diture nt t. The dual their re things s above R&D state corpo Steve invest like emplo reports rate incom a n ment unive that Preside G. Zylstra both ymen rsities e nt and by corpo t growt , paten CEO an innov h, ration ts — Debor Leigh s and all comp to aggre ation ecosy ah Zack Golds Senior onent tein Vice stem. gate all s of TECN Membe Director, Operat President, nation those A rship ions and al is going state Service Don Events officia report to help repor s ls in ts into Executi Ruedy Jennife Anne ve Emeritu Directo a the techn Washington enlighten Rody Tucson r, Member Ayres our electe s, ology on the Office Finance Director, rship indus d Yes, all impor Service and Adminis try in s of this Justin Alex value the U.S. tance of tration effort to Directo Rodriguez Executi Williams Merry r, Tucson ve Emeritu impor membership ultimately Lake Merre Tucson tant, Office s, adds in our Directo ll it boost Office Marketi segme group r, Don Rodrig ng and s the Jerem nt of . But Commu value our y Baben uez chanc nication of a majoras Editor e to live economy dure, Ph.D. Directo so we better Arizona r, all have lives. Ron SciTech the Festiva Executi Schott l ve Emeritu Doug Phoenix s, Reid Office g partn
Arizona Director, Innovati on
14 By the Numbers
Get Your Website Found on the Internet
Top Valley brokers assess the recovery of Greater Phoenix’s housing and commercial real estate sectors.
New releases from thought leaders on building an enterprise.
Hospice of the Valley ICAN
32 Power Lunch
Bink’s Midtown Plus: Hot spots for a power breakfast
What are the implications of a study out of Stanford University that reveals nearly two-thirds of CEOs do not receive outside leadership advice — but nearly all want it? Business Education
30 Visitors Wanted –
In this second of his three-part education series on Internet marketing, Thomas Beyer discusses approaches to integrating optimization strategies that draw visitors. On The Agenda
27 Spotlight Events
In Business Magazine Guest Editor Economic Symposium & Expo Governor’s Celebration of Innovation
Business events throughout the Valley
N o v e m b e r 2013
2014 Ford Explorer Sport Plus: Security products to protect digital files
“Hiring Help with Reschedge,” “Mobile Business Card Connects,” “Funding for Your Idea or Product,” “Auction Is Business Opportunity in China,” “First Impressions Help Hire,” “Phoenix Market Draws New Hotel Brand and National Test Kitchen,” “Financial Literacy Program for Kids Yields Profits for Entrepreneur” and “New Rules Allow Advertising for Investors”
47 Tempe Chamber of
NA T ech
gy r epO
November 2013 • Vol. 4, No. 11
Visit our Business Solution Centers to learn more about Business
Need Funding? Learn more by downloading this report on alternative lending at inbusinessmag.com/ business-solution-center For much more on areas of business, visit our Business Solution Centers on: Finance & Banking • Marketing Safety • Healthcare • Legal Commercial Real Estate • Small Business
Publisher Rick McCartney
Editor RaeAnne Marsh
Art Director Benjamin Little Contributing Writers Laura Antonuccio
Thomas Beyer Mike Hunter Kiersten Murphy Dan Nillen Don Rodriguez Photographer-at-large Dan Vermillion Advertising
Operations Louise Ferrari
Business Development Chris Bowers Louise Ferrari
Craig Jeffries Maria Mabek Sara May Katie Pacioni Kelly Richards Cami Shore
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President & CEO Rick McCartney Editorial Director RaeAnne Marsh Senior Art Director Benjamin Little Financial Manager Donna C. Mitchell, CPA Accounting Diane Meyer Office Manager Matthew D. Whitmire
Corporate Offices 6360 E. Thomas Road, Suite 210 Scottsdale, AZ 85251 T: (480) 588-9505 F: (480) 584-3751 email@example.com www.inmediacompany.com Vol. 4, No. 11. 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 firstname.lastname@example.org 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. © 2013 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.
N o v e m b e r 2013
David Bruno, Managing Director, DHR International Phoenix
David Bruno is vice chairman and managing director of DHR International’s Phoenix, Ariz., office, and has been a major contributor to the company’s growth to fifth-largest search firm in the United States. His 25plus years’ experience in seniorlevel recruiting encompasses organizations from 10-person firms to Fortune 10 companies, in almost every state as well as internationally. Bruno has played an active role as an advisor director on several boards of corporations, served as the 2012-2013 chairman of the Greater Phoenix Chamber of Commerce, and is on the board of directors for Arizona Business Leadership.
On the subject of jobs, the rhetoric can get very heated as numbers are cited and calls to action urged. Arizona’s unemployment figures during the recession were near the top in the nation, and in the recovery some sectors are complaining of not enough workers. But numbers do not define the bottom line in today’s employment picture. Arizona is seeing growth today in almost every industry, and almost everyone is looking to hire — but not necessarily from the local population. In fact, companies are becoming more open-minded about positions being commute-able, and executives are choosing to make weekly commutes rather than relocate their families. Today’s employee is a bit different, and employers are having to attract candidates in newfound ways for what are becoming changed work environments. There are so many variables in today’s business climate that those who can take seemingly disparate issues and meld them into one actionable item are valued, and business owners and CEOs have taken a more hands-on role themselves in the hiring of new employees rather than leaving it to their HR department. Who has the hiring power today? Those in the Human Resources realm — staffing, HR services, employers — say it’s not the employees’ market of the immediate pre-recession years. The applicant must sell his or her skill set or aptitude to the employer. But what In Business Magazine editor RaeAnne Marsh discusses in the cover story “The New Employee: Veering from the Traditional” is, businesses are finding they now need to sell the attractiveness of their job opening to the prospective employee. And there is no “one size fits all” formula for the employer to follow. Also in this issue, attorneys Laura Antonuccio and Kiersten Murphy explore public procurement in Arizona and its potential as a lucrative and reliable source of business for both established and emerging companies. Thomas Beyer continues his three-part “Business Education” series on Internet marketing with an article that addresses a most-basic concern — what a business must do to let customers know its website is there on the Internet; what it must do to ensure customers find it. With more than 85 percent of “clicks” going to the highest-ranking websites, Beyer’s article looks at two fundamental areas of optimization: SEO and Multi-Channel Optimization. In an “Economy” feature, banker Dan Nillen explains three best practices for investors managing a commercial real estate portfolio. This issue also includes the Arizona Leadership Forum special section, which provides an update on this initiative launched last February by National Bank of Arizona and The Phoenix Philanthropy Group to harness the combined energy of the for-profit, not-for-profit and government sectors to build our economy into the future. I hope you’ll enjoy this issue of In Business Magazine, and am pleased to be part of this business community that does so much to empower where we live. Sincerely,
David Bruno Managing Director DHR International, Phoenix office
A Time to Hire The norms of hiring are undergoing great change, some dictated by the economy and some by the attitude of the current young hires. Providing a resource to help navigate the changes, our cover story, “The New Employee,” digs into what we as business owners and hiring managers can expect. Good ol’ instinct is, in my opinion, the best asset in hiring for one’s own company, but the article’s participants enable an understanding that will certainly add to our hiring and retention best practices.
Connect with us: The Valley guru on hiring is David Bruno of DHR International. He has worked to onboard a number of high-level CEOs, and he and his staff remain on top of the trends and even oddities of hiring practices and employee needs. We thank him for his contributions to this issue and hope that his insights will be beneficial to those hiring Valley-wide and beyond. —Rick McCartney, Publisher
Story Ideas/PR: email@example.com Business Events/Connections: firstname.lastname@example.org Marketing/Exposure: email@example.com Or visit us online at www.inbusinessmag.com
N o v e m b e r 2013
Feedback Executives Answer Valley Leaders Sound Off
We hear official reports stating still-high unemployment figures. Yet anecdotally, we hear businesses in all fields complain they can’t find employees to fill open positions. As an employer, have you changed your expectations in terms of recruiting new employees?
Owner Frances Boutique Sector: Retail As a small employer with 15 employees, I have the advantage of creating a culture that I want to work in, and I stay true to my core values by controlling my hiring process. I never compromise my expectations when hiring for my retail stores because customer service is my highest priority for a successful shopping experience. The people working on the team are the core of this environment. Through the seven years I have been in the retail business and the economic ups and downs, employees are still looking for a work environment where people are caring and they can fit in. Most people seeking jobs want to feel a connection to their workplace rather than just have a job. Hiring for longevity, smaller local businesses are looking for people who are involved and passionate about the place they live and their community. I have been fortunate to attract these specific employees, and the connections they feel to the business translate to the customers and the community. Frances francesvintage.com
Georganne Bryant is the owner of Frances, a seven-year award-winning “Best Boutique in Phoenix” specializing in local and unique gifts, clothing and accessories. Frances is a modern boutique with vintage charm. Bryant is a member of Local First Arizona and on the Small Business Leadership Council for the Phoenix Chamber of Commerce.
Mary Ann Sturm Assistant Vice President, Human Resources SCF Arizona Sector: Insurance While official reports may state high unemployment figures, the number can vary widely depending on the industry. Countrywide, the unemployment rate for the insurance labor market is at a record low of 2.5 percent. In addition, we know that competition for talent within our industry is growing stronger, with more than 70 percent of companies expecting to increase staff during the next 12 months. Because SCF Arizona is committed to ensuring we have the talent needed to achieve our long-term business strategies, we continue to
N o v e m b e r 2013
Co-founder and CEO Infusionsoft Sector: Technology At Infusionsoft, our expectations haven’t changed in terms of recruitment. We’re always looking for great talent who are committed to our purpose to help small businesses succeed. When you get clear on your company’s purpose, values and mission, you are going to attract the right candidates and repel the wrong ones. When you are building a vision-based company, having clarity in this area couldn’t be more important because every new hire will either strengthen or weaken the culture. Regardless of economic conditions, we’ve never compromised on our hiring practices. We’ve always maintained selection criteria that vet people for cultural fit. We screen for values alignment, ask questions related to attitude and set up interactions with employees before ever making an offer. We’ve also always sought out those who are fired up about our company’s “why.” You don’t want to hire someone who isn’t excited about your vision. These measures might mean it takes longer to find the right people, but when passionate people come together around a shared purpose and common values, you’ll find business success. Infusionsoft infusionsoft.com
Recognized as a visionary leader in the small business community, Clate Mask has been educating and inspiring entrepreneurs for more than a decade. His passion for small businesses success stems from his personal experience taking Infusionsoft from a struggling start-up to a seven-time Inc. 500/5000 winner. As CEO, Mask is leading Infusionsoft on its mission to create and dominate the market of all-in-one sales and marketing for small businesses.
assess our recruiting strategies. Our approach is a long-term holistic one. For example, we believe there should be a focus on educational efforts for young people by offering them education, training resources and internships. Our partnerships with universities and community colleges are essential and we endeavor to leverage resources with the education providers. We’ve also made changes to the way we source candidates, relying heavily on social media. It is not unusual to conduct a search nationally for professional-level positions. In fact, in the past year, nearly 30 percent of our professional hires came from outside of Arizona. SCF Arizona scfaz.com
Mary Ann Sturm joined SCF Arizona in December 2004. Her more than 20 years’ experience as a leader in the human resources industry includes several senior HR management positions. She received a bachelor’s degree from Akron (Ohio) University and her master’s in business administration from the University of Phoenix. Sturm is a member of the Society for Human Resource Management and has earned a Professional HR certification and is a Certified Compensation Professional.
Quick and to the Point
Auction Is Business Opportunity in China
The recent visit to Phoenix by the Chinese Association of Auctioneers presages business opportunity for local businesses. Selling through auction “allows manufacturers to introduce their product to a market without the huge expense of marketing,” says Deb Weidenhamer, whose iPai is the first wholly foreign-owned auction house in China and whose Auctioneers & Appraisers Academy the Chinese contingent came to attend. This method also offers an entry to the Chinese market without having to deal with the complexities of foreign licensing and regulations. “As the economy needs to grow and service businesses are necessary for the growth of our economy, we expect to see more auction companies expand the auctions they conduct,” says Yanhua Zhang, president of China Association of Auctioneers. Public auction is a new industry in China, where auction itself is only about 20 years old. “In the past, Chinese auction companies relied on the China’s government to obtain product. Now, the market-oriented economic reform in China is changing the country’s auction industry and, as a result, Chinese auction companies need to find some new business models,” Zhang says. How to add the exciting “chant” and speed used in American auctions are among the tips the Chinese auctioneers are interested in learning. Weidenhamer, who added the auctioneering academy in 2011 to her Auction Systems company, notes that preparing for an auction helps a company shore up its product’s key points as it trims its message to a concise 20-30 seconds. Auction also enables a company to actually determine fair market value and get market feedback faster than a market research company could provide it, while actually selling product. —RaeAnne Marsh Auction Systems auctionandappraise.com
Photos courtesy of Steve Best (top right)
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Mobile Business Card Connects The vizCard mobile business card solution, available from All-State Legal, is a personalized mobile website that can be shared easily. A QR code, text messaging, email, a mobile wallet card with NFC, and Apple Passbook can be used to download vCards, view CommonConnections™ on LinkedIn and Facebook, and view hand-picked profiles, videos and other online content. aslegal.com/vizibility
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N o v e m b e r 2013
Quick and to the Point
Financial Literacy Program for Kids Yields Profits for Entrepreneur
Phoenix is a great market for Choice Hotels International’s newest brand, Cambria Suites, in the middle but upscale tier that research predicts will see the highest demand over the next 20 years. “When you grow a brand, you want to grow in primarily urban markets where you can get eyeballs on the new product,” says Michael Murphy, senior VP of Cambria Suites, explaining that the hotel’s Desert Ridge location puts it in a prime Scottsdale-Phoenix micro-market that attracts a variety of traveler to its malls (as consumer as well as vendor), the Mayo Clinic and corporate business. A comfortable, casual restaurant is part of the Cambria Suites design. Reflect will have approximate 35 seats, plus seating at the bar and the bar lobby. When the hotel opens in the fall of next year, the Phoenix location will have the distinction of housing the national chain’s test kitchen headed up by local celebrity chef Michael DeMaria. Murphy had initially reached out to Chef Michael to create a food program appropriate for the brand — to enhance the guest experience but at a low cost. Tim O’Reilly, CEO of O’Reilly Hospitality Management, which is developing the hotel and will be managing it, decided to leverage Chef Michael’s involvement and offered to make his hotel the test kitchen. Ensuring consistency throughout the brand, Chef Michael developed an 8-hour video training program and accompanying illustrated recipe book that enables new cooks to “come in and learn in 24 hours,” Murphy says. The food and beverage program is fast-casual, with 90 percent of the items a core menu but allowing 10 percent to be flexible in order to customize it to local tastes and products. —RaeAnne Marsh Cambria Suites cambriasuites.com
N o v e m b e r 2013
My Job Chart myjobchart.com
New Rules Allow Advertising for Investors
Small businesses and start-ups have greater leeway in advertising for investors with the recent passage of a revision to the JOBS Act of 2012, regarding Securities and Exchange Commission rules, that enables small companies to publicly announce efforts to raise money. Regulation previously in effect dated from 1933, long before social media became a staple in communication, and limited small businesses and start-ups to soliciting only investors they already knew and whose income and assets met certain thresholds. While the new rule does not expand who businesses can allow to invest in them, it does provide more ability to attract attention to fundraising efforts by allowing small business to conduct general advertising to find investors, explains Congressman David Schweikert (R, Az. Dist. 6), co-sponsor of the JOBS Act. “This, in turn, will allow companies to find qualified investors more easily, which ultimately will enable them to grow and create jobs,” he says. New rules regarding investing, approved by the SEC and now in the “comment period,” are poised to be finalized next year to allow investors to buy stock in companies over the Internet using a crowdfunding exchange. —RaeAnne Marsh U.S. Securities & Exchange Commission sec.gov
Photo courtesy of Cambria Suites
Phoenix Market Draws New Hotel Brand and National Test Kitchen
Teaching financial literacy to kids has reaped its own financial strength for Scottsdale-based My Job Chart, which founder and CEO Gregg Murset says adds a new member every two minutes. A certified financial planner with 20 years’ experience in the insurance and financial services industry, Murset says the idea came from wanting to instill in his own children characteristics he’d found common to business owners: “They work hard and make good money decisions.” He created a free online program that allows children to keep track of chores or jobs and the money they’ve earned, and provides parents with a variety of avenues for paying them. Reminiscent of the old-style chart many parents would post on, for instance, the refrigerator, this program uses today’s technology to engage the children on computer, iPhone or other device. The site invites parents to sign up their children (ages 5 to 15) and set up a schedule of tasks, and the children keep track of points they accumulate, which they can save, share with a charity or spend. Murset built the business on a premium business model, providing the app for free but monetizing on the back end. For instance, the My Job Chart site offers a link to Amazon.com, and children who choose to spend their accumulated points can indicate the item they want and the parent can order it — adding a convenience to parents through the delivery directly to their home — and Amazon.com pays a commission to My Job Chart. Banks also pay a commission when parents open a savings account for their children. My Job Chart has proved five times better at getting parents to open kids’ savings accounts than banks’ efforts at cross-selling their own customers, Murset relates. Initially launching My Job Chart in 2010, Mu rset spent that first year “figuring things out and getting the website to handle a lot of traffic.” Relaunched in 2011 with 50,000 members, My Job Chart had more than 500,000 members as of the beginning of last month — a 900-percent growth rate for itself and an economic impact of money paid by parents to their children in excess of $2 million. —RaeAnne Marsh
Subscribe Today and Class Up Your Client Entertaining, Employee Recognition and Business Development 602-495-1999 | phoenixsymphony.org
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By the numbers
Metrics & Measurements
Update: Recovery in the Phoenix-Area Real Estate Sector Housing market seen as recovering; commercial also showing positive signs Phoenix-area home prices shot up since hitting a low point in September 2011. From last August to this August, the median single-familyhome price rose 28 percent — from $150,000 to $192,000. The median townhouse/condo price rose 31 percent. This dramatic rise is largely due to the relatively small supply of homes for sale. Now, an increase in homes on the market is helping stop this price boom, explains Mike Orr, director of the Center for Real Estate Theory and Practice at Arizona State University’s W. P. Carey School of Business, in a report released in early October. “Although demand still exceeds supply, they are fast moving toward each other,” says Orr. “If the current pace of change continues, they are likely to be in balance before the end of the year. The seller is no longer holding all the cards in the Greater Phoenix housing market, and if their offers are countered aggressively, some potential buyers may walk away because they now have more alternatives.” The types of transactions happening in the market are also noticeably shifting. Luxury homes priced more than $500,000 grew their
market share from 15 to 21 percent of the money being spent over the past year, while the lowest-priced homes (below $150,000) fell from 25 to 14 percent of the market. Investors continue to lose interest in the Phoenix market, with better bargains available in other parts of the country. The percentage of residential properties purchased by investors fell from the peak activity of 39.7 percent in July 2012 down to just 23.7 percent this August. The rates of all-cash buyers and out-of-state buyers are also dropping. In fact, the percentage of Maricopa County residences sold to non-Arizona owners in August was only 17 percent, the lowest percentage since January 2009. Changes in the commercial real estate market generally lag the residential market. To help gauge the state of the commercial market, ASU’s W. P. Carey School of Business at Arizona State University brought together a group of the area’s most successful brokers for a forum and survey about progress on apartments, retail, industrial, offices and more. “We talked with a lot of people feeling the
market from their own individual perspectives, and because of that, it was hard to get consensus on many of the issues,” explains the forum organizer, Mark Stapp, director of the Master of Real Estate Development program at the W. P. Carey School of Business. “Everyone generally agreed we’re recovering in the commercial market, but we’re not there yet. At this point, lots of investor money is chasing only a few good deals in specific areas of the Valley. This is causing prices on the best property to go up, as people try to handle economic uncertainty and position themselves for a broader recovery.” —Mike Hunter W. P. Carey School of Business wpcarey.asu.edu
Local Brokers’ View of Commercial Real Estate Sector for Q4 Percentages show diversity of opinion among the top brokers from a variety of sectors, specializations and brokerage house across the Valley, gathered by the W. P. Carey School of Business Center for Real Estate Theory and Practice for its Commercial Real Estate Broker Forum heading into Quarter 4, 2013. Figures are based on the number of brokers per response.
Where are Office Vacancy Rates headed in the next three months?
Where are Office Rents headed on the next three months?
Is the tight inventory for homes on the market affecting the commercial side at all?
27% 40% 67%
Down No Response
Not Yet, But It Will
W. P. Carey School of Business Center for Real Estate Theory and Practice wpcarey.asu.edu/research/real-estate-research W. P. Carey School of Business Center for Real Estate Theory and Practicey
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Investing in property
Commercial Real Estate as Investment Three best practices for managing a commercial real estate portfolio by Dan Nillen Across the country, commercial real estate companies are finding that managing a portfolio is a particularly challenging task in today’s economy. The following best practices demonstrate that effective portfolio management starts with the development of a thorough review process that allows a business to respond to opportunities in the market.
Frequent Reviews Are Critical Although many in the real estate industry feel they have their fingers on the pulse of their portfolios, at the heart of any successful portfolio management program is a thorough review process. Regular reviews — at least quarterly — can help companies consider different investment approaches, monitor interest rates and, in the end, apply effective credit management techniques to minimize market risk and maximize profits. One of the most important reasons to frequently review a portfolio is to stay nimble in a rapidly changing interest rate environment. Beyond interest rates, other issues demand regular analysis of real estate investments, including market fluctuations and how a portfolio evolves.
Tenets of Review Process Because interest rate shifts can ultimately boost risk exposure, it is essential that real estate developers examine a portfolio’s risk factors and how they impact a balance sheet. Primary considerations in the review process include: ■■ Interest rate risk. Even a small interest rate increase or decline can significantly affect real estate portfolios with millions of dollars in primarily floating-rate debt. To mitigate risk on rates, the real estate developer may want to consider purchasing an interest rate swap, cap or collar, or look into rolling into a fixed rate. ■■ Debt maturity. It is vital to look at maturity dates within a portfolio. As loans mature, it may be necessary to recalibrate the portfolio with new and different financial instruments. The preferred effective practice would be to stagger maturities to avoid overburden on staff, and, therefore, have ability to adjust to the market.
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■■ Plans for a property. What are the plans for a particular property, and how will it be used? An investor who aims to retain an asset over the long term has different needs from one looking to sell within a year or two. The use of liquidity comes into play on where the investor wants or needs to place his cash over the coming 12 to 24 months. ■■ Portfolio make-up. Apartments and retail spaces have entirely different cash flow models. An apartment complex likely would provide predictable cash flow due to the surging rental market, but the retail establishment may prove highly variable — depending on whether it’s leased or empty. Being overweight in any asset class may make a portfolio susceptible to market risk, but adding asset diversity (multi-family, retail, office and industrial) can help offset some of that risk. The end goal is to match the debt to the property.
Focus on Liquidity In many instances, matching debt to the property means turning to a combination of loan instruments that include fixed and variable rates — as well as interest rate swaps, collars and caps. Swaps allow the synthetic conversion of interest-sensitive loans into fixed interest rates. Caps establish a ceiling for future interest rates through the payment of a premium. Collars are hybrid structures
that establish both an interest rate ceiling and floor, and allow the rate to remain interest-rate sensitive between these two parameters. These devices offer a high level of flexibility and a range of options in all interest rate environments. They also can help an investor build a portfolio that provides liquidity at strategic points to help commercial real estate companies realize other business goals. Unfortunately, this holistic approach to investing is too often overlooked. Consequently, a developer may lack essential capital 5 or 10 years down the road. To avoid this scenario, an investor can ask the following questions when building a portfolio: What are my plans for this property now and at various points in the future? Will additional projects or properties demand liquidity? What is my overall tolerance for risk, and how can specific properties, as well as the entire portfolio, affect this? In the end, it’s important for portfolio managers to make sure all of the business partners they work with thoroughly understand the industry and how to best approach commercial real estate investments. Portfolio management is a critical element of an overall business plan that successfully minimizes risk and maximizes profits. BMO Harris Bank bmoharris.com
Dan Nillen is regional senior vice president and director of BMO Harris Bank’s Commercial Real Estate division for Arizona.
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Labeling the Generations
Although broad generalities have become popular over the years to describe generational differences among those in the work force and their impact on the workplace, values are shifting as a picture emerges of the New Employee. See how they are defined throughout this story.
New Employee Veering from the Traditional
Employers juggle multiple factors in attracting and retaining talent by RaeAnne Marsh
As businesses have begun ramping back up into a slowly recovering economy, expanding their work force is often a top priority. Filling job positions, however, is turning out to be a challenge as employment has come to encompass myriad aspects of culture, values, training and aspirations.
Angelo Kinicki observes, “Managers and employers can’t do the same old thing they’ve been doing. ... It’s a tougher task than existed in the past.”
“It’s gotten much more competitive for the employer to find the most talented employees,” says Grant Dipman, general manager of the Ritz-Carlton Phoenix. To find the right fit for the organization, he says, Ritz-Carlton changed its hiring process about two years ago to look beyond work experience and try to ascertain talent in finding the right fit for the organization. For Ritz-Carlton, it’s a “strong customer service focus no matter what part of the hotel” the person will work in, Dipman explains. But not all businesses are as clear about what they’re looking for. And that, says Susan Williams, founder and CEO of human resources firm HR Choice, is why many companies are finding hiring to be very difficult. “Employers advertise a job and get an overwhelming number of applicants,” she says. “The clearer the employer is in what he’s looking for in a candidate, the easier it is to screen and do a better match.” In many cases, the small and midsize companies do not have the HR infrastructure — such as job descriptions and screening and hiring processes. This was not a problem in the past, when there were fewer applicants; now, there could be a hundred or more resumes to go through. And, Williams notes, this situation is the same for all positions — management, hourly or trade. If a new hire is not a good match for the job, he or she is likely to leave within the first year. Companies, therefore, need to make it more
Baby Boomers (the post-World War II generation;
born between 1946 and 1964):
• See “job hopping” as a blight on one’s resume • Are motivated by increased pay, recognition and job promotion • Accept long hours as a requisite of advancement
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of a priority to create appropriate recruiting and hiring practices, and not, as Williams says, “just hire to hire.” Angelo Kinicki, who teaches in the Management Department at ASU’s W. P. Carey School of Business and is known for his expertise in leadership and employee response to organizational change, observes, “Managers and employers can’t do the same old thing they’ve been doing.” Instead of just looking at hiring from the standpoint of their own needs, they need to look at the needs and values of the employees they want to attract, and “offer what’s important to them.” And he notes, “It’s a tougher task than existed in the past.”
Match to Workplace Culture The concept of “culture” has become accepted as a concern for employers, who no longer offer just a job but create a workplace environment. Companies even vie for “Best Place to Work” awards. The Baby Boomer generation that has begun to retire from the work force is taking with it values based on a more hierarchical view of the work place, with an expectation of staying with a company over the long-term and feeling that the work they produce for the company speaks for itself. With the Millennials, retention is a continuous effort and, in terms of work product, they want to feel they offer a unique skill set. “They need to have that [affirmation] communicated to them,” says Kirsten Hall, workforce project manager with the Arizona Commerce Authority. Recognizing that different generations have different expectations complicates the recruiting and hiring process, Williams observes. She finds younger generations place more importance on opportunities to grow and “will do more interviewing of the employer than other generations.” Once hired, Gen X and Millennial employees are more likely than their older counterparts to move on if they find the job not stimulating or interesting enough or the work environment too bureaucratic. The more progressive work environments recognize the importance younger employees place on being involved in projects that are meaningful to them. And they are also facing challenges to basic management policies as different norms come into play. Social media is one such area. Explains Kinicki, “If a company outlaws Facebook at work, that would be OK with a Baby Boomer, who’s used to walking down the hall to have a conversation. But a 27-year-old has grown up with it; [for that generation], it’s part of who they are.” Culture is also about communication. “It’s important to have a culture of clear and transparent communication, both upward and downward,” Hall says, explaining this impacts retention because employees then feel the employer is open to a conversation if their needs change. And then there’s work-life balance, which companies foster in different ways. At the Ritz-Carlton, employees will work longer hours inbusine ssmag.com
Gen X when occupancy is high, but the company makes up for that during slower times. Citing employees as the company’s most important resource, Dipman says, “As a company, we’ve learned the value of employees having that balance and the opportunity for vacations.” The quality of the managers and supervisors in an organization is another factor in retaining talent, although Williams points out this has long been true. “The largest percentage of those leaving, do so because they didn’t like the manager or supervisor they worked for.” Pay is usually not the issue, she emphasizes; respect is — and this is true no matter the age of the employee. In fact, the concern for a stable culture may be even stronger in the more mature employee, says Todd Govig, president and CEO of executive search firm Govig & Associates, who relates he has seen supervisors actually throw chairs. Jessica Corral, partner with recruitment firm Headfarmer in Phoenix, says she finds now that “companies are seeing the need to strengthen the management team, to create a more stable environment that offers the opportunity for growth.”
Benefits Matter While career path and making a difference are more important to the younger employees than are benefits, benefits still stand among the top three items candidates look at when making their employment decisions — especially medical insurance. Some companies are looking at a different way of providing healthcare insurance, says Williams, who is seeing a trend — especially among smaller businesses — of using the healthcare exchange for more affordable healthcare. “They offer to make a contribution toward the cost, but don’t offer a [company] healthcare plan.” Retirement plans are another important benefit. The popular 401(k) has recently been in the news over issues of high fees and poor fiduciary management, but several companies in Phoenix take a different path to providing for their employees’ future. Wilson Electric and McCarthy Building Companies are two businesses that have an employee stock ownership plan (ESOP), in which employees share ownership interest in the company. “The ESOP is very important in recruiting and hiring quality people,” says Wilson Electric president Wes McClure, noting that as things pick up, qualified employees are harder to find. “Employees understand they are owners and reap the reward of what they contribute” in ideas or productivity to further the company. He believes that success comes from everyone working together and that the ESOP helps in getting everyone on the same page. Bo Calbert, president of McCarthy Building Companies, puts it succinctly, “Employee ownership has played a big factor in our performance.” He’s found, however, that recent college graduates value money in their pocket today over future planning. “They don’t see inbusine ssmag.com
(born between the early 1960s and early 1980s):
• Approve of changing jobs to suit one’s evolving interests • Are motivated by an open workplace culture • Believe work-life balance is important
themselves 30 years ahead,” he says, “but after they’ve been here five years, they start seeing the value.” McClure sees the attitude difference related more to age than generation. “As people get older, they look more at retirement.” But he feels it’s “what the guys in the field are looking for and how I feel they are happiest and most productive,” he says. “You have to have the mindset that you want the employees to share in the success.” Flex time — enabling people to have flexibility about how they manage their work life — is another benefit that seems to span the generations. “For Baby Boomers, that could mean dealing with eldercare and grandkids; for younger people, possibly sleeping in and working later,” Kinicki explains. Another approach to benefits has recently been reported: Facebook is planning to build an apartment complex adjacent to its offices in the Bay Area. While the idea is, giving employees a great price on their rent will “make people really want to work there,” Kinicki notes it also means their time is not lost in commuting and they can work more hours. “Of course,” he points out, “there are not many companies that can do this.”
A Growing Remote Work Force There’s a growing interest in a remote work force, which Kinicki attributes to the increased use of information technology in the way much of the work is done today. According to Greg Waddington, Phoenix area director with Regus, fully two-thirds of Phoenix professionals manage someone who works remotely, and an even higher percentage of Phoenix businesspeople (77 percent) believe managing at a distance has advantages and is a growing trend — and 86 percent think it helps in staff retention. This includes letting employees work from home and the sharing of temporary work spaces. “If you have 15 percent of your work force work from home one or two days a week, think of the cost savings,” Kinicki says. Another rationale is part of N o v e m b e r 2013
(also known as the Millennial Generation; born Regus’s strategy in providing what it terms “flexible work space” — providing locations that give businesspeople a convenient place away from a centralized office if they are out in the field and have several hours in between appointments. Waddington acknowledges there are concerns about how to manage a remote work force, and there is no universal agreement. Williams notes that while a remote work option can make sense in certain jobs — and a business may be able to hire someone who might not be available otherwise — it’s important to evaluate the maturity and commitment of the employee. Williams does not believe that the opportunity to work remotely makes a lot of difference in recruiting. “Most people want to feel part of a team.” Kinicki suggests a company consider the strategy to work remotely at the time of hiring rather than later, observing the attractiveness of it is “more of a personality characteristic than related to a person’s age.”
Loyalty Is Not Lost “Articles say loyalty is gone in corporate America, but what I see is, it’s rare to hear employees say they plan to move on in five years; they want to be where they can stay a long time and make a difference — almost without exception,” says Govig, who has worked with several generations over his 26 years in the recruitment industry and whose own company, Govig & Associates, has kept many of its recruiters for 10 to 15 years. He finds the new generation to be diligent, hard-working and bright, although they may be naïve about pay and promotion at first blush out of college. They want to grow and add to the organization, providing leadership even if they are not in a formal leadership role. Reiterating a common theme among those interviewed for this article, Govig says money is not the main motivator keeping people at a job. “People want to work at a place they can be proud of; that’s fun; where they are challenged, and rewarded appropriately.” This characteristic, often applied to the younger generations, “is drifting into the older groups,” he says. When a company builds a relationship with the employee, that lays the foundation for loyalty. A big part of this is the employee’s sense that his or her contribution makes a difference, a validation that can come from the employer, co-workers or customers. There is a flip side to this that Headfarmer’s Corral points out. Companies often seek to hire employees who show the stability of having been with an employer for at least five years — but view a lengthy tenure as a shortcoming. “If they’ve been at a company too long, they’re seen as not able to adapt to change; they only know one company’s way of doing things.” Dipman stresses that the opportunity Ritz-Carlton offers individuals to go from entry-level to senior positions within the company — of which his own rise is an example — is a stronger draw to new college
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between the early 1980s and early 2000s):
• See job changing as an expected part of personal growth • Are motivated by opportunities for personal fulfillment • Believe flex-time is important
graduates. “They’re excited about working for a company they can have a career with and that genuinely cares about your growth,” he says, noting Ritz-Carlton not only empowers employees to make decisions to take care of guests but gives them the opportunity to be involved in planning of work that affects their job.
Training? Yes and No. At Ritz-Carlton, training is part of the opportunity for growth as it gives employees a chance to experience other aspects of the hotel’s operations. “They may start in rooms, then help in banquet and find they really enjoy food and beverage,” Dipman says. Training programs are important in engaging the employee, says Frank Armendariz, regional vice president of Manpower, a staffing company. They help younger employees, especially — who do not have years of experience — to be successful, which is a factor in retention. However, companies may choose to go after more seasoned employees at a higher pay rate — and have the expectation that the employee already has the skill set. He has also noticed a trend of employers looking for employees that have multiple talents — to shrink training time. In many cases, formal training is not so important in today’s world, unless a company has its own specific way of doing things. “Information is so readily available due to technology, many companies have the expectation that employees will go out and access the information,” Corral says. A high growth area now is temporary work or project consulting. Explains Ben Howard, co-CEO of recruiting firm VincentBenjamin, “A lot of companies scaled back so significantly they are now evaluating how aggressive they need to be in the competition for talent, and are focusing on ‘just in time’ employment” — what they need to get the job done now. Employees may take advantage of the flexibility this gives them to target the specific skills they enjoy and a higher-pay inbusine ssmag.com
Explains Ben Howard, “A lot of companies scaled back so significantly they are now evaluating how aggressive they need to be in the competition for talent ...”
engagement than they could get through traditional avenues. Employers coming back after such a severe scale-back, on the other hand, are trying to fill multiple needs with one head count rather than evaluating the skill sets necessary for each function. However, while companies are hiring based on the ability to ramp up right away, Hall says employers are also complaining that soft skills are lacking — from team building and communication and problem solving to just coming in on time. And while employers are not as open now to taking on newer, less experienced talent, Howard points out that technology is so fluid that, in certain skill sets, recent graduates may have all the experience and knowledge there is to have.
Where Is the Work Force? A large pool of unemployed workers does not translate to a large pool of available talent. The knowledge worker is becoming more important, and so also are specific trade skills. SRP, for instance, is concerned about finding people for lineman work. And manufacturing companies moving here may find a work force that is not as well-trained technically as it is used to. Arizona is a right-to-work state, Hall points out, unlike the East Coast and Midwest, where unions are strong. “And the union does a fantastic job of training.” “Private industry is partnering with education to increase the pipeline,” says Patricia Wallace, assistant director for workforce development with Maricopa Workforce Connections. This, in fact, is one of many areas where MWC is helping them work toward solutions. “We work with the business to get an understanding of what it is looking for, then contact the community college — which either already has a program or has the capacity to create one — and determine the best resources and how to access and use them,” she says. The focus is on looking at trends so as to create a solution that has broad application in related or even diverse industries, such as a curriculum MWC recently helped design to aid a bottling company and other advanced manufacturing companies that has been of help in logistics for a furniture company and pest control. “Some skills are translatable from one industry to another,” says Howard, observing that employers may be open to considering applicants from other industries depending on what the function is. And Armendariz notes that companies need to diversify their recruitment strategy if they are looking for specific talent that can make an immediate impact, based on both skill set and the ability to integrate into the workplace culture immediately. They may need to be open to untapped talent as well as recent college graduates and veterans. With a thin pipeline, companies sometimes attempt to recruit from fellow companies — after all, it’s a stable work force. Dipman says Ritz-Carlton encourages its guest relations/concierge team to inbusine ssmag.com
attend concierge functions in different cities and develop relationships with others in the industry — and get in touch with them when the company has an opening. This “relationship recruiting,” he says, has been successful. Another of Ritz-Carlton’s strategies is to go to trade and technical schools. “Our executive chef is an invited speaker at culinary schools,” says Dipman, explaining this enables Ritz-Carlton to create relationships and look for potential candidates to recruit in the future. Filling workforce needs, Dipman says, “We need to look far ahead.” Arizona Commerce Authority azcommerce.com Govig & Associates govig.com Headfarmer LLC hfrecruiting.com HR Choice hrchoice.com Manpower manpower.com Maricopa Workforce Connections myhsd.maricopa.gov/Divisions/Workforce-Development.aspx McCarthy Building Companies, Inc. mccarthy.com Regus regus.com Ritz-Carlton ritzcarlton.com VincentBenjamin, Inc. vincentbenjamin.com W. P. Carey School of Business wpcarey.asu.edu Wilson Electric wilsonelectric.net
(the generation currently being
born; beginning birth date variously considered late 1990s to mid-2000s):
• Integrate technology seamlessly into all aspects of life • Have a strong global awareness • Impact on workplace as yet unknown as this generation is just beginning to enter the work force
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ENTER P RISE
Risks & Rewards
Exploring Public Procurement in Arizona Potential for lucrative and reliable business by Kiersten Murphy and Laura Antonuccio Both well-established and emerging companies seeking to expand in Arizona should consider whether to pursue lucrative government contracting opportunities. However, confusion about when and how the government actually purchases goods and services often keeps businesses from pursuing these opportunities. Through understanding what public procurement is, how it works and why a company should explore public contract opportunities, we can begin to chip away at the mystery.
What Is Public Procurement? Public procurement is a straightforward concept. Government entities at every level spend billions of dollars each year purchasing a wide variety of commodities and services, ranging from office supplies to health insurance for government employees. Public procurement is simply a term of art for the competitive process that must be followed before the government can purchase almost anything — aside from small purchases, which are not subject to the formal procurement process. During the process, the government determines how goods or services should be procured and issues a solicitation, also known as a request for bids or proposals. Next, interested and qualified companies respond, carefully adhering to the solicitation’s requirements and the applicable law. Procurement officials then review and evaluate the submissions, and award the contract.
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Procurement officials are charged with securing goods and services in the government’s best interest. In some cases, that “best interest” may be realized by contracting for the lowest priced goods. For example, fungible goods like pens or pencils are procured through an “Invitation for Bids” process, with the contract awarded to the lowest-priced responsible and responsive bidder. Alternatively, the government’s “best interest” may be realized by contracting for goods or services that are most responsive to the issues the government seeks to address through a “Request for Proposals.” For example, a health insurance proposal may be more expensive than competing proposals, but it may better represent the unique coverage the government seeks to provide its employees.
Why Consider Public Procurement? Securing a government contract can mean a significant increase in a company’s profitability. The government frequently awards large contracts, some of which last several years and generate a steady stream of revenue over the term. The government also tends to be a stable customer, offering near-certainty of payment. Additionally, government contracts are governed by identifiable laws, rules and regulations that mandate openness and fairness in the competitive process, and otherwise provide for and protect companies’ rights. Those rules and regulations generally provide a mechanism to challenge the government’s decisions to ensure fairness and openness in the decision-making process. inbusine ssmag.com
Books Effective procurement is also in the public interest — a robust and competitive process assists the government in securing low-cost, best-value goods and services in the best interest of the government and the taxpayer.
How Long Does the Process Take? The length of each procurement process — from solicitation issuance to final contract award — varies from contract to contract, and may depend on a number of factors that include the government entity and its needs, the product or service sought, the timetables established by the solicitation, whether or when an existing contract will expire, the contract’s dollar amount, the number of interested bidders, whether anyone challenges the solicitation or protests the recommended contract award, and so forth. The rules are designed to keep the process moving forward, and turnaround times can range anywhere from days to months.
What if a Company Is Successful (or Not)? A company’s ability to perform the terms and conditions of the contract to the government entity’s satisfaction is critical. As a successful contract awardee, establishing goodwill and a positive impression with a government customer can pay dividends in future procurement opportunities. On the other hand, failing to meet promises may have a lasting, negative impact on a company’s ability to secure future contracts. Remember, there is a learning curve in submitting proposals to the government, so even if a company isn’t successful the first time, there’s no need to be discouraged. An unsuccessful bidder can assess how to improve future proposals by scheduling a post-award “debriefing” meeting with procurement officials to learn why the government chose a competitor, and by submitting a public records request to obtain copies of competitors’ proposals. Unsuccessful bidders should also consider whether it makes strategic sense to challenge the government’s award through a bid protest, identifying errors in the procurement process (e.g., scoring, methodology or compliance with applicable law). Because procurement officials have great discretion, bid protests are an uphill battle, but may still be worth pursuing if a company is on solid legal ground and if there are objectives outside the procurement process worth pursuing (e.g., to alert the government to flaws in the process). A wealth of procurement information is available online. The State Procurement Office website provides information on contracting with the State of Arizona. Federal contracting information/ opportunities can be found on the Government Accountability Office and Federal Business Opportunities websites. And many Arizona localities (cities, counties, etc.) provide information on their websites about local procurement opportunities and procedures. If you decide to pursue government contracting opportunities, commit to the process. Be strategic, diligent, well-researched and thorough, and remember that great patience can bring great reward. Arizona Department of Administration, State Procurement Office spo.az.gov Gallagher & Kennedy gknet.com General Services Administration, Federal Business Opportunities fbo.gov U.S. Government Accountability Office gao.gov
Kiersten Murphy and Laura Antonuccio are Arizona attorneys and members of the Public Bidding & Procurement team at Gallagher & Kennedy. They assist clients with a wide variety of government contracting matters.
Building An Enterprise
It Starts with One: Leading Strategic Change J. Stewart Black identifies the three critical “brain barriers” managers must break through in order to start, deepen and sustain needed change. With new cases, examples and tools for executing successful change initiatives, this edition dives even more deeply into the personal aspects of leading strategic change — as well as the unique challenges posed by driving change in global business environments. J. Stewart Black and Hal Gregersen $39.99 • FT Press • December 2013
Jim Cramer’s Get Rich Carefully Jim Cramer uses his 35 years of experience as a Wall Street veteran and host of CNBC’s “Mad Money” to create a guide to high-yield, low-risk investing. In our recovering economy, this is the plan for making big money without taking big risks. Drawing on his unparalleled knowledge of the stock market and on the mistakes and successes he’s made on the way to his own fortune, Cramer explains — in plain English — why a person can get rich in a prudent, methodical way, as long as he starts now. James J. Cramer $29.95 • Blue Rider Press • Late December 2013
The New Corporate Facts of Life: Rethink Your Business to Transform Today’s Challenges into Tomorrow’s Profits Rivenburgh demonstrates that old rules of business are being rendered obsolete by disruptive innovation, economic instability, environmental degradation, increasing stakeholder power and other sweeping global forces. Through interviews with top executives and thought leaders, she shows that bold leaders move beyond today’s best practices to develop tomorrow’s next practices. They don’t predict the future; they create it. Diana Rivenburgh $27.95 • AMACOM • November 2013
Reputation Economics: Why Who You Know Is Worth More Than What You Have As the Internet has increasingly become more social, the value of individual reputations has risen and a new currency based on reputation has been created. This means that not only are companies tracking what an individual is tweeting and what sites they spend the most time on, but they’re using this knowledge to predict the consumer’s future behavior. Klein’s book points to the importance of data in becoming a success. Joshua Klein $28 • Palgrave Macmillan • On shelves and online
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by RaeAnne Marsh
Actions to build Community
Hospice of the Valley: Compassionate End-of-Life Care The expansive starry night sky becomes a backdrop of memories as Hospice of the Valley invites families and individuals to gather as a community at its annual Light Up a Life on Nov. 24 to celebrate loved ones who have passed away. At the Steele Indian School Park in Phoenix, a large-scale, open-air photo montage is played out to music while people view from blankets spread out on the grass. To heighten the atmosphere, Hospice of the Valley provides illuminated necklaces for guests to wear and paper ornaments to personalize with a loved one’s name and then hang on the trees. The annual event is free to attend and open to the community, regardless of whether the deceased was a hospice patient. HOV accepts photos for the montage for about two to six weeks prior to the event. “For me, Light Up a Life marks the beginning of the fall and winter holiday season,” says Executive Director Susan Levine. “It exemplifies everything community represents — and everything hospice is about: families coming together; offering support to one another; honoring loved ones; focusing on the good times; melding spiritual reflections with physical comforts (yes, we do serve hot chocolate and cookies!).” Celebrating life is the theme that runs through everything HOV does, and no one is turned away for lack of insurance or financial means.
■■ SAVE THE DATE: Hospice
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Hospice of the Valley hov.org
of the Valley’s signature fundraiser is AAHA! An Auction of Heirlooms and Art, to be held March 15 at the Arizona Biltmore. Dinner, silent auction (which includes original works) and live auction with collectible pieces and one-of-a-kind experiences. With its mission of “Comfort and dignity as life nears its end,” HOV supports patients and families and relieves physical, emotional and spiritual suffering through a wide variety of programs. HOV was founded in 1977 by a group of community volunteers aiming to provide comfort care to patients and families in the familiar atmosphere of their own homes. It now has a staff of about 1,600 and about 2,700 volunteers. A nonprofit organization, it receives most of its funding from Medicare as most of its patients are older than 65 and on Medicare. A small amount comes from donations, insurance and private pay.
■■ ICAN, founded in 1991
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as “Improving Chandler Area Neighborhoods” to provide a place youth could go after school as a counter to rising gang violence, was rebranded in 2011 as simply “ICAN.” ICAN is one of only two youth agencies in Arizona accredited by the National Council on Accreditation. With its four 15-passenger vans, ICAN provides transportation not only from the children’s school but, for about 80 percent of them, a ride home as well. “Many families don’t have transportation,” says Becky Jackson, executive director. More than 700 volunteers assist a paid staff of 26, who include prevention specialists with degrees in fields such as social services and education, to provide a variety of programs and services “to help [youth] be more successful and break the cycle of poverty,” Jackson says.
Christmas trees adorned with at least $2,500-worth of decoration is the centerpoint of ICAN’s Festival of the Trees fundraiser. Last year’s highlight was Chase Construction Company’s tool extravaganza — its tree came with a full assortment of Black & Decker tools — that was actually auctioned off four times. The trees are part of the live auction capping an evening of “Masquerade” at Sheraton Wildhorse Pass in Chandler on Dec. 6 that also includes a cocktail reception, silent auction and “five-star dinner.” “We encourage people to get into the theme,” says ICAN executive director Becky Jackson, who will be carrying her own “Masquerade” mask on a stick. Masks made by the youth in art class will be the “thank you” cards to the winning silent and live auction bidders. This year’s fundraising goal is $250,000, all of which will go toward ICAN’s programs. Serving a population in a four-square-mile area of downtown Chandler where eight out of 10 youth live in extreme poverty (income less than $15,000 per year for a family of four), ICAN provides youth ages 5 to 18 programming that encompasses drug abuse prevention, leadership training, homework help and more. And fun, of course, to keep them coming back. ICAN’s Hill Learning Academy, developed with Chandler Unified School District, provides an alternative route to a high-school diploma to a population at high risk of dropping out of school. ICAN icanaz.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 courtesy of Hospice of the Valley (top), ICAN (bottom)
ICAN: Play, Hope and Skills to Break the Cycle of Poverty
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.
In Business Magazine
Annual Guest Editor Economic Symposium & Expo Fri., Nov. 15 — 11:00a – 2:00p Arizona Technology Council
Governor’s Celebration of Innovation Thurs., Nov. 14 — 4:00p – 8:00p A night of networking, food and fun is on tap for the Governor’s Celebration of Innovation awards gala. A strolling dinner and formal awards ceremony honoring technology leaders and innovators from throughout Arizona will be set among an exciting showcase of exhibitors, and will be followed by an after party with specialty desserts and live music — all taking place at the Phoenix Convention Center. Awards are presented in four categories: Start-Up Company, Small Company, Large Company and Academia. Additional presentations this year are the Ed Denison Award to Clark Peterson, CEO of Telesphere; the William McWhorter Award to The Thomas R. Brown Foundations; and Representative of the Year, to Speaker of the House Andy Tobin (R; Dist. 1). Ten legislators will also be recognized as “Legislator of the Year.” Now 10 years old, the Governor’s Celebration of Innovation has become the premier technology community gathering of its kind in Arizona. Tickets are $150 for members of the Arizona Technology Council; for non-members, $200.
Photo courtesy of Jay Mark
Arizona Technology Council aztechcouncil.org
Some of the greatest business minds in the 2013 Valley of the Sun have contributed their insight and expertise as Guest Editor of an In Business Magazine issue. On Friday, Nov. 15, many of these men and women will come together in the unique presentation debuted to acclaim last year, the Annual Guest Editor Economic Symposium luncheon held at the Arizona Biltmore. They will take part in a panel discussion on emerging economic opportunities, strengthening our workforce, business funding, government policy, education and other important economic issues that affect us as businesspeople. The event will also include a business expo showcasing business services. Guests are invited to visit exhibitors before and after the luncheon. There will be gift items, prizes and more for this exciting addition to the annual event. The Economic Symposium will start with a reception that affords guests an elite networking opportunity. The panel discussion will be presented during the luncheon that follows, moderated by Ted Simons, host of KAET Channel 8’s “Arizona Horizon.” Among those confirmed for the panel are Deborah Bateman, executive vice president of National Bank of Arizona; Barry Broome, president and CEO of Greater Phoenix Economic Council; Jerry Colangelo, principal partner of JDM Partners; John Hupppenthal, Superintendent of Public Education for the State of Arizona; Elliott D. Pollack, CEO of Elliott D. Pollack and Company; Donald Smith, president and CEO of SCF Arizona; Charles Vermillion, CEO of OneNeck IT Services Corp.; and Candace D. Wiest, president and CEO of West Valley National Bank. Presenting sponsors of the annual Economic Symposium in 2013 are National Bank of Arizona, SCF Arizona, Arizona Commerce Authority, Eight Arizona PBS at Arizona State University, Alliance Bank of Arizona, Mercedes-Benz of Scottsdale, Cancer Treatment Centers of America and In Business Magazine. —RaeAnne Marsh In Business Magazine inbusinessmag.com
Notable Dates This Month Sun., Nov. 3
Daylight Saving Time ends
Tues., Nov. 5
Mon., Nov. 11
Wed., Nov. 27
Hanukkah begins at sunset
Thurs., Nov. 28
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.
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O n t h e Ag e n d a AHWATUKEE FOOTHILLS CHAMBER OF COMMERCE 4th Annual Palo Verde Award Gala ‘Diamonds & Denim’ Sat., Nov. 2 6:00p – 11:00p
The Chamber’s signature fundraiser honors Business Woman of the Year and awards the Women in Business Scholarships. $115 Rawhide Western Town 5700 W. North Loop Rd., Chandler ahwatukeechamber.com
ARIZONA CHAMBER OF COMMERCE AND INDUSTRY 2013 Air Quality Conference Wed., Nov. 6 8:00a – 4:00p
The Arizona Chamber of Commerce and Industry and Maricopa County Air Quality present an Air Quality Conference full of cutting-edge information. Members: $75; non-members: $95 Sheraton Phoenix Airport Hotel 1600 S. 52nd St., Tempe Taylor McArthur, tmcarthur@ azchamber.com
ARIZONA HISPANIC CHAMBER OF COMMERCE Minority Business Enterprise Summit Fri., Nov. 15 7:30a – 11:30a
The Phoenix MBDA Business Center and the Arizona Hispanic Chamber of Commerce will host the 2nd Annual Arizona Minority Business Enterprise Summit. $75 Arizona Biltmore 2400 E. Missouri Ave., Phoenix (602) 279-1800
ARIZONA INTERNATIONAL GROWTH GROUP Global Business Conference 2013 Thurs., Nov. 21 8:00 – 5:00p
The Phoenix MBDA Business Center in partnership with Thunderbird School of Global Management is hosting its first Global Business Conference. $125 Thunderbird School of Global Management 1 Global Pl., Glendale phoenixmbdacenter.com
Implementation – is presented by Sharon Covert, vice president of strategic services for Viridian Health Management. Free asba.com
and improve their bottom line. Free with registration Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler firstname.lastname@example.org
Creating Your Effective Networking Commercial
Search Engine Optimization and Online Marketing
Members: free; non-members: $10 ASBA’s Business Education Center 4600 E. Washington St., Phoenix Sarah Travis, email@example.com
Part of a workshop series to help businesses build the essential skills to be more effective and improve their bottom line. Free with registration Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler firstname.lastname@example.org
Tues., Nov. 12 1:45p – 3:00p
Healthy Arizona Worksite Program – WEBINAR Thurs., Nov. 14, 1:00p – 2:00p Tues., Nov. 19, 9:00a – 10:00a
Part 5 – Program Evaluation – is presented by Sheila Pudists, regional director of Viridian Health Management. Free asba.com
ARIZONA TECHNOLOGY COUNCIL Council Connect: Wed., Nov. 6 11:30a – 1:00p
“Getting Ready to Buy or Sell a Company – Now or in the Future” is presented by Jennings Strouss. Members, $35; non-members: $55. Lunch is provided. Seasons 52 2502 E. Camelback Rd., Phoenix aztechcouncil.org
Governor’s Celebration of Innovation Thur., Nov. 14 4:00 – 8:00p
Presented by Avnet, Inc., this annual awards gala honors technology leaders and innovators from across the state. Members, $150; non-members: $200 Phoenix Convention Center, West Building, Third Floor 100 N. Third St., Phoenix aztechcouncil.org (See article on page 27.)
CENTRAL PHOENIX WOMEN Breakfast Meeting Mon., Nov. 18 7:30a – 9:00a
The meeting will feature a presentation by Dr. Susan Wilder on wellness and healthy lifestyle decisions. $75; reservations required The Ritz-Carlton 2401 E. Camelback Rd., Phoenix centralphoenixwomen.org
ARIZONA SMALL BUSINESS ASSOCIATION
CHANDLER CHAMBER OF COMMERCE
Healthy Arizona Worksite Program – WEBINAR
Effective Websites and Blogging
Part 4 – Program Planning &
Part of a workshop series to help businesses build the essential skills to be more effective
Tues., Nov. 5 9:00a – 10:00a
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Tues., Nov. 5 4:00p – 6:00p
Tues., Nov. 12 4:00p – 6:00p
Technology Lunch Seminar Series Thurs., Nov. 14 11:30a – 1:00p
Every month a different technology topic. Deli lunch and beverage is included. Members: $5; non-members: $15 Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler email@example.com
Business Goals and Graduation Tues., Nov. 19 4:00p – 6:00p
Part of a workshop series to help businesses build the essential skills to be more effective and improve their bottom line. Free with registration Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler firstname.lastname@example.org
ECONOMIC CLUB OF PHOENIX Luncheon
Tues., Nov. 19 11:30a – 1:30p
Speakers will be Dan Burns, chief executive officer of Athlete’s Performance, and John Stobo, managing partner of ABS Capital. $75; advance registration required Hyatt Regency Scottsdale at Gainey Ranch 7500 E. Doubletree Ranch Rd., Scottsdale econclubphx.org
GLENDALE CHAMBER OF COMMERCE Small Business Trade Show Thur., Nov. 14 1:00p – 4:00p
Make initial contact with buyers representing military bases, federal agencies, universities and more. Free Thunderbird School of Global Management 1 Global Pl., Glendale email@example.com
GREATER PHOENIX CHAMBER OF COMMERCE Professional Women’s Alliance Tues., Nov. 5 11:00a – 1:00p
Speaker is Lisa Daniels, Phoenix office managing partner of KPMG, LLP, who will cover the topic “It’s Hard to Beat a Person Who Never Gives Up.” Free to attend. Lunch: $15 for Chamber members, $25 for non-members National Bank of Arizona – Arizona Biltmore Circle, Conference Center 6001 N. 24th St., Phoenix Cheri Valentino, (602) 495-2194
MESA CHAMBER OF COMMERCE Roundtable Discussion with Mayor Scott Smith Wed., Nov. 6 Noon – 1:30pm
Join Mayor Scott Smith for lunch and a roundtable discussion with Mesa business owners. Free Humana 5943 E. McKellips Rd., Mesa mesachamber.org
NATIONAL ASSOCIATION OF WOMEN BUSINESS OWNERS NAWBO University Wed., Nov. 13 9:30a – 11:00a
“Financial Literacy for Non-Financial Business Owners.” Members: free; non-members: $30 Phoenix Country Club 2901 N. 7th St., Phoenix Suzanne Lanctot, firstname.lastname@example.org
Wed., Nov. 13 10:45a – 1:00p
An exclusive panel of industry leaders discussing what you need to know about funding the growth of your small business. Members: $38; non-members: $48 Phoenix Country Club 2901 N. 7th St., Phoenix Suzanne Lanctot, email@example.com
NORTH PHOENIX CHAMBER OF COMMERCE Business Resource and Networking Luncheon Tues., Nov. 12 11:30a – 1:30p
This month’s topic is “Search Engine Optimization.” Members: $20; guests: $25; after Nov. 8, all: $30 Moon Valley Country Club 151 W. Moon Valley Dr., Phoenix Fern Hailey, (602) 482-3344
Business and Community Partnership Expo Fri., Nov. 22 4:00p – 6:00p
First annual Deer Valley Unified School District Business and Community Expo, developing true partnerships between Deer Valley Unified School District and our community.
Please confirm, as dates & times are subject to change.
Free Deer Valley Unified School District 20402 N. 15th Ave., Phoenix Gina Moss, (623) 445-5010
PEORIA CHAMBER OF COMMERCE 2014 Business Growth Conference Wed., Nov. 6 7:00a – 6:00p
More than 20 seminars focused on key areas of business management. Meal included, plus attendees get one professional head shot photo. $49 ASU West La Sala Conference Center 4701 W. Thunderbird Rd., Glendale peoriachamber.com
SCOTTSDALE AREA CHAMBER OF COMMERCE
As the Chamber’s marquee event, the Sterling Awards program embodies the spirit of the organization by celebrating the people and companies that make our community a great place to live, work and play. $75 Chaparral Suites Resort Scottsdale 5001 N. Scottsdale Rd., Scottsdale Anna Mineer, (480) 355-2708
Expert Human Resource Series Tues., Nov. 19 7:30a – 8:45a
Fri., Nov. 8 8:00a – 9:00a
Free; space is limited to 20 Scottsdale Area Chamber of Commerce 7501 E. McCormick Pkwy., Scottsdale Kelly Rich, (480) 355-2714
28th Annual Sterling Awards Luncheon Thur., Nov. 14 11:30a – 1:30p
Social Media Happy Hour Fri., Nov 1 1:30p – 4:00p
OTHER BUSINESS EVENTS
State of the City Address
Arizona Association for Economic Development
Thurs., Nov. 21 7:30a – 9:00a
Mayor Mark Mitchell’s State of the City Address. The event includes breakfast. Members; $50; general public: $70 Tempe Mission Palms 60 E. 5th St., Tempe Sachiyo Spires, firstname.lastname@example.org
WEST VALLEY WOMEN
Join the Scottsdale Area Chamber of Commerce and Mountain State Employers Council for a series focused on Human Resources. $20 Mountain State Employers Council 7975 N. Hayden Rd., Scottsdale Nikki Hoffman, (480) 355-2712
SURPRISE REGIONAL CHAMBER OF COMMERCE
Business Owners Forum
TEMPE CHAMBER OF COMMERCE
Video Marketing Business Education Seminar Windmill Inn & Suites 12545 W. Bell Rd., Surprise Mary Orta, (623) 583-0692 ext. 101
Funky Handbag Contest & Luncheon Tues., Nov. 5 11:30a – 1:00p
Luncheon speaker is Brian Mueller, president and CEO of Grand Canyon University, who will provide an expansion update for GCU and its role in the Phoenix marketplace. Members and their guests: $40; non-members: $50; after Nov. 1: $55 Phoenix Country Club 2901 N. 7th St., Phoenix aaed.com
Guest Editor Economic Symposium & Expo
$35 Arizona Broadway Theatre 7701 W. Paradise Ln., Peoria westvalleywomen.org
Fri., Nov. 15 11:00a - 2:00p
WOMEN OF SCOTTSDALE Annual Spirit of Scottsdale Luncheon Fri. Nov., 15 11:30a – 1:30p
Tues., Nov. 5 11:15a – 1:15p
$35; reservations required The Westin Kierland Resort & Spa 6902 E. Greenway Pkwy., Scottsdale womenofscottsdale.org
Luncheon and an extraordinary panel comprised of many of the Valley’s top business executives. Exciting business services expo immediately before and after the luncheon. $75 Arizona Biltmore Resort, Frank Lloyd Wright Ballroom 2400 E. Missouri Ave., Phoenix inbusinessmag.com (See article on page 27.)
Prepare for 2014 and get Exposed!
Your company deserves to be fit. Performance Marketing: Print. Online. Email. Social Media. Events. (480) 588-9505
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Helping Raise the Bar on ... INTERNET MARKETING
Visitors Wanted — Get Your Website Found on the Internet Integrate your optimization and beat the competition by Thomas Beyer Last month, we discussed how to design a website to support your sales process. Now that you’ve created a sales-oriented site, it’s time to make sure you get found by your prospects. More than 85 percent of “clicks” go to the highest-ranking websites. The key search engine ranking components are Search Engine Optimization (SEO) and traffic building. In this article, we’ll take a look at two fundamental areas of optimization: SEO and Multi-Channel Optimization. In next month’s article, we will discuss traffic building, or search engine marketing, as the final installment of this three-part series on Internet marketing. To begin, remember that search engine ranking is a dynamic process. It’s affected by not just direct market competitors. Ranking competition can come from any direction: a competitor’s business partners, lead services and list services, to name a few. Someone has to come out on top; let’s make sure it’s you.
What is Search Engine Optimization? In English, Please! Search engines like Google promise users they will receive the most relevant data requested by a search. Before a search engine can tell where a document is located, it has to sift through hundreds of millions of Web pages. The engine employs special software spiders that crawl the Web and build lists of words found on websites and then index them so that, later, these sites can be accessed quickly. The objective of SEO is to show the search engine that your site belongs at the top of the list. SEO is a collection of techniques that webmasters use to create search engine-friendly websites. As a generalization, search engines tend to categorize Web pages based on keywords and links.
Keywords — a One-Time Charge? Keywords are important terms that are relevant to the content on website pages, and these are what the software spiders analyze. These keywords are most commonly located in headlines and within body copy. Years ago, SEO was in and of itself an art form. Today, the process is often accomplished by software that does the job quickly and efficiently. Now, instead of paying thousands of dollars monthly for SEO, it’s common to pay one-time fees capped at $500 to $600. (It should be noted that the search engines continuously refine ranking criteria; therefore, your site’s intended functionality should determine the frequency of updating your SEO.) Regardless of how they are incorporated or how they are judged, keywords continue to hold an important priority in the search engine ranking algorithms.
Multi-Channel Optimization (MCO) Can Turbocharge Your Ranking Multi-channel optimization most often refers to improving search engine visibility by linking videos, blogs, directories, email and social marketing campaigns, and reputation management to a website. When viewers find and share valued information on your website, the sharing process can help catapult your site’s popularity. Whether the content
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is in the form of information, controversy, entertainment, instruction, humor or inspiration, your links should be compelling enough to make the viewer want to share with others. The more shares, the better your overall online presence. Let’s look at a how MCO works within your website. You may already have a blog, educate your customers via YouTube videos, list your company in directories, respond to Yelping customers or post your views on Facebook and Twitter. Taking an email marketing campaign as an example, your email might contain links that tie back to your website for coupons, event sign-up or special offerings. Another example could be encouraging other marketers of similar content to employ reciprocal links to your educational video series that is located on your website. In these examples, you are using different channels to leverage different marketing communications techniques to improve the ranking and visibility of your website. When it comes to Internet/digital marketing, you want to beat your competition. Page One of all search engines should be your objective. The first step is SEO, making it easy for the search engines to find you and classify your content. Next, MCO, integrating your marketing communications tools to help the search engines confirm your popularity. Search engine optimization and multi-channel optimization will help improve your ranking and increase visitors. But if you want your sales to explode, you’ll want to consider target marketing next. We call it “strategic traffic-building for qualified leads,” and we’ll talk about that next month. Beyer Management Consulting, Inc. beyermanagement.com
Thomas Beyer is president of Beyer Management Consulting, Inc., located in the Deer Valley Airpark. BMC assists business owners and executives to quickly increase sales and profits through cohesive integration of traditional and digital marketing strategies and tactics.
The Education Series
q October: Base Website Design on Your Sales Process q November: Visitors Wanted - Get Your Website Found on the Internet q December: Explode Sales with Targeted Online Marketing To reference published segments of this series, please access the archived “How-to” articles on the In Business Magazine website, www.inbuisnessmag.com.
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by Mike Hunter
Meals that matter
Morning Meeting of the Minds Doing that meeting to gain a client, shore up a deal or introduce one’s talents can easily happen over coffee and eggs. Here are some of the hot spots for that power breakfast.
Conveniently located in the heart of Phoenix, Kevin Binkley’s newest venture is Bink’s Midtown. One of the Valley’s most acclaimed chefs, Binkley is known for his namesake restaurant in Cave Creek, Binkley’s Restaurant, which is consistently named as a No. 1 pick among critics. His midtown establishment has quickly become just as acclaimed and is turning heads and tempting taste buds with his cleverly flavorful soups, salads and sandwiches. Lunch is about packing in flavor, with delicate to more hearty items. Starters include Deep Fried Baby Back Ribs, Fois Gras and Sweetbread Nuggets, all with delectable sauces that complete the dish. Several local produce items are on the menu with accompaniments that make eating the produce itself (sold hot or cold) an unbelievable experience. Popular for lunch are the sandwiches. The Brisket Sandwich is made with slow-roasted brisket, coleslaw and rye bread spread with brown sugar mustard. Another is the Fried Green Tomatoes Sandwich on focaccia with mixed greens, charred onions, mayo and bacon jam. A not-to-be-missed dish is the Bistro Steak coated with maitake mushrooms, boiler onion and a cucumber chimichurri, served with fries. Those in a hurry may try the Express Lunch, which guarantees a 30-minute experience for just $15 and includes a starter or salad with a sandwich. Located in the small bungalow that once housed Sophie’s Bistro, Bink’s is quaint and simple with an Old Phoenix appeal. Updated to accentuate the benefits of being in a bungalow, the bar and seating is comfortable and homey, and service is so friendly and uniquely elegant that it’s obvious why Binkley is known for impressing even the most experienced of chefs, critics and patrons. This is a lunch spot that will be famed in no time as a place to go back to frequently.
The Camelback Corridor hang-out for the most successful, Hava Java has been a staple since 1992. Small and intimate, this place serves up exceptional coffees and service that will impress. It’s a true coffee house (maybe one of the originals); its atmosphere is casual and tables are scarce. Fresh bagels, bialys, muffins, croissants and breads daily. 3166 E. Camelback Rd., Phoenix (602) 954-9080 havajavaphoenix.com
ZuZu at Hotel Valley Ho
Off the lobby at Hotel Valley Ho, ZuZu is a great hideaway spot for that private breakfast or a poolside meeting. In one of the high-backed booths against the wall, one can always do that one-on-one meeting over bacon and eggs or any American favorite for breakfast. 6850 E. Main St., Scottsdale (480) 421-7997 hotelvalleyho.com
Bink’s Midtown 2320 E. Osborn Rd., Phoenix (602) 388-4874 binksmidtown.com ZuZu at Hotel Valley Ho
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Photos courtesy of David Zickl (left, top and bottom); ZuZu at Hotel Valley Ho (right)
Bet on Bink’s Midtown
For the full-service, full breakfast, Bistro 24 at the Ritz-Carlton is the place to hit. Easy parking, best service and an impressive setting; this is a morning hot spot for clients of all kinds. Patio, cooked-to-order dishes of all kinds or even a personal concoction will satisfy. 2401 E. Camelback Rd., Phoenix (602) 952-2424 ritzcarlton.com
by Mike Hunter
We Value What We Own
Securing Our Assets We think our businesses are secure enough with an alarm system that includes a motion detector or two and even a camera on the premises. However, most of our assets are digital and are likely on our computers. Here are some security products to protect those files.
Bitdefender Small Business Pack
Bitdefender’s entrylevel antivirus product is rated among the best, consistently. Bitdefender has many products for small-business protection that include a total security pack. $150 for 5 users per year. bitdefender.com/business
Photos courtesy of Ford (right); Bitdefender, Symantec, Kaspersky (left, top to bottom)
Symantec Endpoint Protection Small Business Edition
This is cloud-managed antivirus and malware protection made simple that can be managed on-site or on the Web. Created by Symantec, it is very user friendly. $150 for 5 users per year. symantec.com/business
Ford Explorer Sport: Powerful for 2014 Made tough and certainly a reliable brand, the new Ford Explorer Sport is poised to take those loyal to Ford and looking for that zippy mid-sized SUV to task. The 2014 is outfitted with “sporty” accessories and design elements, but truly reaches the definition of its name with the 3.5-liter twin turbo V6 engine. Delivering 365 horsepower and 350 lb.-ft. of torque, this mean version of the Explorer is not going to disappoint. While the power may be too much for this size SUV, it is quick and reliably powerful. It takes some getting used to the speed capabilities when driving initially because the EcoBoost® twin turbo does lurch a bit and does not have the “roar” that one may desire in a souped-up vehicle. The 6-speed SelectShift Automatic® is smooth and features paddle shifters that truly make using the powerful engine a cinch. Gear changes come easily and this Ford engine can handle the higher RPMs. The Sport features a suspension package that makes cornering and performance a comfort. The “sport-tuned” suspension is meant to perform on tight corners while remaining stable. The wider stance of the Explorer design has given this model a mean look since its redesign in 2010. The Sport comes complete with a black painted grill with “sterling gray” mesh, giving the front end a tougher than tough appearance. The “blackout treatment” on the headlights and the taillights coupled with the 20-inch machined aluminum wheels with painted black pockets makes for a noticeably mean arrival. The interior is well planned and comfortable with the standard-feature sport-style “perforated” leather-trimmed heated bucket seats. Stitched to maintain a sporty look, the interior is quite impressive with seats that offer 10-way adjustable power and lumbar support. The second row includes a captain’s chair-style of seating with space between, and a third row is fully tuck-awayable. Space is so well engineered that passenger’s may feel they are in a full-sized SUV. The back 2014 Ford Explorer Sport storage is spacious and conveniently adjustable City MPG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 for small items or large loads.
Hwy MPG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
0-60 MPH. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.5 sec Transmission. . . . . . . . . . . . . . . 6-speed automatic MSRP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $40,780
Kaspersky Endpoint Security for Business
Third-party testers always rank Kaspersky Lab ZAO high. Very reliable and continuously innovating to develop faster and more secure software, Kaspersky offers antivirus, multiplatform and mobile protection. $449 for 10 users per year. kaspersky.com/business-security
N o v e m b e r 2013
Imagine a place that will engage your creativity and enhance your education and sense of cultural community. A place where you can explore a collection of over 17,000 works and experience new exhibitions that are sure to tenlighten your soul. Connect with Phoenix Art Museum—it’s a relationship like no other.
EXPLORE ENGAGE ENJOY The Cape | September 15 – February 19 Rufino Tamayo: Master Printmaker | September 21 – January 12 Xul Solar and Jorge Luis Borges: The Art of Friendship | October 2 – December 29 INFOCUS PhotoBid | October 5 – October 18 The West Select Exhibition and Sale | November 10 – December 31 Read My Pins: The Madeleine Albright Collection | November 23 – April 20 See, Hear, Feel: The Photographs of Debra Bloomfield and Christopher Churchill | December 7 – March 23 Hollywood Costume | March 26 – July 6
© 2013 Phoenix Art Museum. All Rights Reserved. LEFT to RIGHT: Ed Mell, Sweeping Clouds, 1989. Oil on canvas. 53” h x 53” w. Museum purchase with funds from anonymous donors. Krishna and Radha under an Umbrella, Kangra School, 19th century. Ink and color on paper. 8.375” h x 6.375” w. Gift of George P. Bickford. Robert Henri, The Laundress, 1916. Oil on canvas. 36” h x 29” w. Gift of Mr. and Mrs. Norman Hirschl.
1625 North Central Avenue Phoenix, AZ 85004 phxart.org
2013 ARIZONA LEADRSHIP FORUM
GREAT BY CHOICE
NATIONAL BANK OF ARIZONA IS
ELEVATING ARIZONA What do great leaders do? They practice disciplined thought. They have the discipline to face the “brutal facts” and the faith that they can prevail. Jim Collins Leadership Expert, Author and Keynote Speaker
The 2013 Arizona Leadership Forum could not have come at a better time. Following the difficult years of the economic slump and the often confusing portrayal of Arizona in the media, there are promising signs that growing numbers of Arizonans have a clear and positive view of the Arizona they want for the future. Lattie Coor Chairman and CEO, The Center for the Future of Arizona
Arizona today is experiencing the outcomes of the choices made by state leaders over many decades to systematically reduce support and investment that has marginalized residents, social service agencies that support them, and education at every level. Decisions by present and new leadership ultimately will shape Arizona’s future, as well as impact any change in status or direction today. Steve Seleznow President and CEO, Arizona Community Foundation
Continuing the Conversation This past February, NB|AZ presented the Arizona Leadership Forum, a gathering of top executives from around the state representing the corporate, philanthropic, nonprofit, tribal and government sectors. This was a continuation of the conversation begun at the Nonprofit Leadership Forum in September 2011. However, it expanded the scope of participants and advanced the agenda to explore how leaders from all sectors can work together to improve our state. NB|AZ is proud to be leading this effort and working with such notable organizations as Freeport-McMoRan Copper & Gold Foundation, The Phoenix Philanthropy Group and the Center for the Future of Arizona. We share a common vision for the economic development of Arizona and we believe that having serious discussions and tackling the complex issues that we as a community face are the first steps in realizing that vision. I invite you to join us as we continue to elevate the leadership conversation by visiting nbarizona.com and downloading a copy of the 2013 Arizona Leadership Forum White Paper. Learn what more than 700 leaders believe are the opportunities for Arizona to realize its potential as a great place to live and do business. By paving the way for a strong and thriving economic future for Arizona, we will provide opportunity for prosperity and growth. Sincerely,
Keith Maio President and Chief Executive Officer National Bank of Arizona | Member FDIC
Founding Presenting Sponsors
Energy and Ideas for a Better World.
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Poor by Choice
No blaming recession for outcome of Arizona leaders’ decisions by Don Rodriguez The Great Recession often is cited as the reason that Arizonans aren’t farther along financially than others across the country. But Steve Seleznow, president and CEO of the Arizona Community Foundation, challenges everyone to not look back just to 2008. High poverty rate, undereducated work force, income inequality — all can trace their roots back more than 30 years. “These are outcomes, I would argue, that our leadership has led us to produce,” he concluded in his presentation “Poor by Choice: The Power of Leadership” at the 2013 Arizona Leadership Forum. Using sources ranging from federal and state government data to Arizona Indicators issued by the Morrison Institute, Seleznow told leaders attending the Forum that because Arizona voters select their leaders, “it’s an outcome … I would say that we chose.” To demonstrate, he shared a chart indicating that for every $1,000 of Arizonans’ 1980 personal income, $137 was spent on students in the state’s higher education system while $100 was spent on K-12 students. In a trend show-
ing a drop nearly every year since then, those numbers plunged to $76 for higher education and $83 for K-12 by 2010. “The state had put a much higher value [on higher education] back then than they do now,” he expounded in a private interview later. A separate slide showed the outcome of such support: By 2010, the percentage of Arizonans ages 50 and older with at least an associate degree beat the national average for the same age groups. By comparison, Arizonans ages 21 through 49 trail even the national average when it comes to earning degrees. “We have to say, ‘What is the work force we want to create?’” he said in the later interview. “We don’t seem to be growing our own.” Further, he shared with the Forum audience two charts that compared appropriations from the state’s general fund. In 1979, for every $10 spent on education, $1 was spent on protection and safety. But by 2012, $3 was allocated for education for every $1 on corrections. “That’s a choice,” Seleznow told the audience. “That’s a value choice.”
Forum participants learned the most apparent result of an undereducated work force is the richest 5 percent of the state’s households have an average annual income of $274,700 — which is 17 times the income in the 20 percent of households considered the poorest. Seleznow contended this is more than dollars and cents. “It’s about what happens when we spread this inequality on income so far when we know that the social outcome and social indicators will drastically affect our future and the quality of life here,” he said. “We have to lead beyond our boundaries,” Seleznow challenged the audience. To do that, “we have to build new coalitions” that include philanthropy, government and private companies. “But we need more working coalitions to put in place the leaders we want and make the choices we want.” Arizona Community Foundation azfoundation.org Morrison Institute for Public Policy morrisoninstitute.asu.edu
Percentage Point Difference Between Arizona and the U.S. in the Age Group Having Earned an Associate’s Degree or More
Last Updated: 8/12/2010
6% 4% 2% 0% -2% -4% -6%
r ov e
U.S. Department of Commerce, Census Bureau, 200 Census
ARIZONA LEADRSHIP FORUM
Jim Collins Speaks to Arizona His research provides a framework for action for Arizona leadership by RaeAnne Marsh It starts with people. That is a basic tenet of Jim Collins’ teachings on how to effect greatness in an organization, and central to one of the challenges he gave to the assembled leaders at the Arizona Leadership Forum earlier this year. A foremost authority on leadership and author of New York Times bestseller Great by Choice, he urged everyone there to reach out to like-minded people to join their passions to the efforts to create stronger leadership and social cohesion. And looking ahead to next year, Collins also issued a challenge to identify the 20 most respected and influential political leaders in the state and make sure they attend the next forum. He stressed this should be as participants, not as speakers. He indicated that he wanted to be informed of the outcome of those efforts.
ARIZONA LEADRSHIP FORUM
What Arizona is doing, he said, is something he has never seen another state do. In his closing speech, he said, “You have something very interesting that can be happening here. This could become one of the wonderful inflection points stories in our country and one where other people would study you to sort of figure out how this happened.” His keynote speech, in many ways, crystalized the strategies that had already been set in motion — that the Forum was, in fact, part of — and inspired further action, as described in other articles in this Arizona Leadership Forum special section. Collins teaches the importance of disciplined people practicing disciplined thought driving disciplined action. The impetus for the Forum lay in the recognition that nonprofits
— the organizations often closest to the social issues confronting our communities — have not been involved in the leadership addressing those issues. When a Gallup Poll was released that showed only 10 percent of the population throughout the state felt we had the leadership we needed, National Bank of Arizona spearheaded a joint effort with Freeport-McMoRan Copper & Gold and The Phoenix Philanthropy Group to convene a gathering of nonprofit leaders and board chairs — which evolved several months later to the Arizona Leadership Forum, adding leaders of for-profit organizations to the movement. Bringing political leaders to the next Forum follows Collins’ belief in building momentum. It was the challenge he called our “Big Hairy Audacious Goal.”
The Forum is part of a broader effort involving co-founding sponsors National Bank of Arizona and Freeport-McMoRan Copper & Gold working with The Phoenix Philanthropy Group: Arizona Nonprofit Leadership Initiative. The Initiative includes an online portal that allows nonprofits to share best practices; a communication plan to inform people about what’s going on in the nonprofit sector; and an economic vitality study to measure the economic impact of the activities and services the nonprofit sector provides, such as after-school care that enables the parents to hold a job. As Forum panelist Rufus Glasper, chancellor of Maricopa Community Colleges, noted, although there is a lot of individual activity around the state, “until we raise all boats, we won’t get the results we want.” These, then, are what comprise the “Flywheel” of Collins’ key concepts — small initiatives that build to a cumulative effect. He pointed to the importance of considering not only what would be “clicks on the flywheel,” but how to know if we are getting better. Another challenge Collins issued was to find the root cause, a necessary step to being able to bring about systemic change. This requires embracing another of Collins’ basic tenets: It is critical to confront the brutal facts. Greatness is not a function of good or bad circumstance, according to Collins. It is a function of choice and discipline. Facing the brutal facts and acknowledging the truth of the situation is a first step in dealing with that situation. Arizona must embody what Collins has named the Stockdale Paradox — retain the faith that we can prevail to greatness in the end, while retaining the discipline to confront the brutal facts of our current reality. He named this belief structure after Admiral James B. Stockdale, who had described to Collins how he had survived being a prisoner of war for several years — he kept an underlying faith that he would one day be free, but avoided setting himself up for repeated disappointment in tying that belief to a hoped-for calendar date. However long it took, he kept his mind on the image that it would ultimately happen. Collins iterated a triangle whose three points, taken together, define a complete per-
son: success, growth (he noted that growth, not failure, is the opposite of success) and service. He directed a third challenge to Arizona: to have an objective for each of those points on the triangle. The best leaders, Collins said, are those who combine humility with a strong will. They push toward a greatness for the cause — whether a business organization or a social issue — rather than for themselves. It is leadership in the service of a mission rather than personal aggrandizement that defines greatness and what he classifies Level 5 leaders. Underscoring Collins’ studies on leadership is the idea of determining what is empirically working, and then utilizing strategies to make that work on a bigger scale. His final challenge to the Arizona Leadership Forum participants was to build on the work done in the Center for the Future of Arizona’s report “The Arizona We Want 2.0.” He challenged each person to pick one of the eight identified areas — educa-
tion, job creation, environment, infrastructure, healthcare, young talent, civic engagement and community involvement — and assess how he or she spends time and what kinds of clicks he or she creates on the “flywheel.” But his message circled back to, whatever our personal “hedgehog” to which we devote passionate energy and at which we feel we can be best in the world, the first task is “who” — who are the best people to get on board with us or for us to get on board with to further the effort. Each person should find three people who are capable and respected but who are not yet engaged and recruit them for the brutal fact he or she wants to address, and charge each of them with recruiting three more. That, he said, is how to create change. The Arizona We Want Initiative thearizonawewant.org Jim Collins jimcollins.com The Phoenix Philanthropy Group phoenixphilanthropy.com
ARIZONA LEADRSHIP FORUM
A Failure to Communicate Voters play a role in lawmakers’ weak leadership by Don Rodriguez Primary races in recent years often decide winners without the need for runoffs, providing simple solutions in the search for leaders. But for Lattie Coor, quick decisions when electing leaders is symptomatic of a larger problem: the disconnect between candidates and the people they intend to represent. “When the primary determines the outcome, we do not have the level of interaction we need to have,” says Coor, chairman and CEO of the Center for the Future of Arizona. “If you have a large turnout in the primary, that causes candidates to be more active in seeking supporters and discussing issues.” Besides leading to needed runoffs, those discussions can reveal common ground between officials and their constituents. Says Coor, “Citizens and elected officials don’t have a strong bond,” especially at the Legislature. One of the Center’s findings in its “The Arizona We Want 2.0” report was, despite the high consensus found among citizens on key issues, only 10 percent of Arizonans believe their elected officials represent their interests.
ARIZONA LEADRSHIP FORUM
Coor touched on this issue as moderator of the panel “Leading Change for a Greater Arizona” at the 2013 Arizona Leadership Forum. He and others on the panel emphasized that direct contact is critical for both sides when it comes to working with the Legislature. “I think we have to engage, not running down there because of our individual special-interest groups but trying to get them to engage in a long-term planning dialogue,” said panelist Doug Pruitt, board chair of Greater Phoenix Leadership. But that doesn’t mean ultimately letting legislators do what they want. In this regard, panelist Rufus Glasper, chancellor of the Maricopa Community Colleges, shared with the Forum audience his recent experience appearing before the Workforce and Higher Education Committee to discuss three bills, “The posture that we chose to take was to first tell them about the community colleges, tell them about what our role is and what the expectation is.” Center for the Future of Arizona arizonafuture.org Greater Phoenix Leadership gplinc.org
A Shared Vision of Arizona
Leaders of not-for-profit and for-profit organizations build momentum toward a collective movement by Don Rodriguez
ARIZONA LEADRSHIP FORUM
Lattie Coor (left), chairman and CEO of the Center for the Future of Arizona, moderates the “Leading Change for a Greater Arizona” panel discussion with panelists Gonzalo de la Melena, president and CEO of the Arizona Hispanic Chamber of Commerce; Juanita Francis, president of The F2 Family Foundation; Rufus Glasper, chancellor of Maricopa Community Colleges; Courtney Klein Johnson, co-founder of the SEED SPOT; Tony Penn, president and CEO of United Way of Tucson and Southern Arizona; and Doug Pruitt, board chair of Greater Phoenix Leadership
the Forum was one of the most impactful days I’ve spent in terms of quality of information presented, inspiration provided, tools people walked away with, and general feeling of trying to improve what’s happening in Arizona.” For Maio, one of the key takeaways from the forum was a noteworthy finding in a pre-event survey of registrants: Arizona doesn’t seem to have a lack of leaders, just a lack of leaders working together. “We can’t fix this with our Leadership Forum but what we can do is start the conversations, start trying to move the ball,” he says. “It’s that leadership group working together toward a common vision.” His bank’s work with Arizona leaders actually began before this year. In September 2011, National Bank of Arizona was joined by Freeport-McMoRan Copper & Gold Foundation and The Phoenix Philanthropy Group to sponsor the Arizona Nonprofit Leadership Forum, an invitation-only event for more than 250 key decision makers from nonprofit organizations statewide. Maio says the decision was made to eliminate the divide between nonprofit and for-profit businesses by expanding the forum this year to include top executives from both sectors. “We just wanted to take a leadership position in convening those groups
together, and not define that by tax status but just by leadership,” he says of the focus shift.
What Comes Next? Leveraging insights collected at the forum, a white paper was distributed at a follow-up town hall meeting in May and feedback from those attendees was added to an earlier survey to produce a final version published in September; a website has been created to encourage organizations to share information on their commitments and actions; a Web portal will be created; and an economic vitality study will be conducted, says Maio. In addition, town halls will continue the dialogue about promoting learning and communication across a variety of sectors and geographies. “By working together as unified leaders, non- and forprofit companies can make the biggest impact on the future of our state,” he says. Pruitt would like to see what he calls the forum’s “missing link” — political leaders — become part of the action. “They need to be at the table and they need to become part of the solution,” he says, and the leaders must hold accountable those who let ideology get in the way of finding and creating real, positive solutions as well as find and support others who will. We need to “keep the pressure on to address the
Photo courtesy of Ben Arnold Photography
An innovative initiative to identify and support Arizona’s leaders and, more importantly, help get them on the same page when it comes to guiding the state’s future, was launched this year with the Arizona Leadership Forum, a gathering of more than 700 top executives from around the state. They represented Arizona’s corporate, philanthropic, nonprofit and tribal sectors. The Feb. 8 event “allowed us to start a higher level of conversation about how we can work together to improve our environment,” says Keith Maio, president and CEO of National Bank of Arizona and a key organizer of the event. The keynote speaker was author Jim Collins, whose books such as Good to Great reflect his research into successful companies and organizations. “He was actually very intrigued that we were convening this for-profit/notfor-profit group across the state,” says Maio, “and to his knowledge this is the first time he has seen that from any state — in other words, putting that kind of attention and action toward a collective movement.” The day ended with the panel “Leading Change for a Greater Arizona,” led by Lattie Coor, Ph.D., president emeritus of Arizona State University, that also featured J. Doug Pruitt, board chair of Greater Phoenix Leadership and retired chairman of The Sundt Companies, and community volunteer Juanita Francis. Attendee Sarah Suggs, CEO of O’Connor House, feels part of the event’s value was in bringing together divergent views for a respectful dialog toward finding consensus. And Collins “made it uncomfortable for someone to be in the room and not look the problem in the eye.” Danny Opendem, president of Southwest Austism Research and Resource Center, credits Collins’ message about being clear as to purpose and making sure to have the right people in place with already having an impact on his organization, and he shares, “I thought
Arizona Indicators arizonaindicators.org Arizona Leadership Forum phoenixphilanthropy.com/forum Greater Phoenix Leadership gplinc.org National Bank of Arizona nbarizona.com The Phoenix Philanthropy Group phoenixphilanthropy.com
Building a Dream Freeport-McMoRan launches effort to teach women entrepreneurs by Don Rodriguez Women around the world imagine owning their own businesses one day and leading their families to better lives. With the endorsement of the Clinton Global Initiative, multinational mining company Freeport-McMoRan Copper & Gold is working to make those wishes come true with DreamBuilder, a Web-based business skills training and certification program that offers teaching, tools and resources to women. Developed with Thunderbird School of Global Management, the program caught the attention of the initiative launched by former President Clinton that uses a model known as “Commitments to Action” to inspire new, specific and measurable activities and partnerships, explains Tracy Bame, president of the Freeport-McMoRan Copper & Gold Foundation and director of social responsibility and community development for the company. DreamBuilder fit the bill. After the initiative became a partner in the conceptual phase, beta testing began in August 2012 with 78 women at varying stages in their businesses’ lifecycles. They lived in and around Arequipa, Peru; Copiapó, Chile; and Calama, Chile — all locations of Freeport-McMoRan mines. Now it’s time to come home. At the Clinton Global Initiative–America meeting this past June, American DreamBuilder was announced with the initial goal of reaching 4,500 women in Arizona, Colorado, New Mexico and Texas before opening to others across the nation. The English version is under development, with a public launch expected in August 2014. Bame says American DreamBuilder can help address some of Arizona’s challenges, such as job creation. It even can support the Arizona Leadership Forum and its mission by linking to nonprofits serving women or entrepreneurs interested in partnerships. “American DreamBuilder will give women the skills they need to take their dreams to a new level,” she says. “It will be designed to not only build business knowledge but the confidence to put that knowledge into action.” Clinton Global Initiative clintonglobalinitiative.org DreamBuilder dreambuilder.org Freeport-McMoRan Copper & Gold Foundation freeportinmycommunity.com Thunderbird School of Global Management thunderbird.edu
Photo courtesy of Todd Rosenberg / Clinton Global Initiative
real issues in front of us and work to get the collaborative spirit that was in that room [at the forum] alive.” To keep the momentum, Francis says the state’s best leaders should be identified and supported. “Coalesce around one or two specific initiatives and support our best leaders to make those things happen successfully,” she says. Even those who didn’t attend the forum can play a part. Laurel Kimball, founding principal of The Phoenix Philanthropy Group, urges individuals to select an actionable item they are passionate about, such as retaining young talent in Arizona or protecting the state’s natural environment, then share metrics about the results of their involvement on the forum’s and Arizona Nonprofit Leadership Initiative’s shared website. She also encourages residents to become well-informed on facts about our state at such websites as the Morrison Institute for Public Policy’s Arizona Indicators. “We hope that individuals and organizations will seek to be part of the dialogue about Arizona’s pressing issues as we reach out to leaders from the nonprofit, business and governmental sectors in all parts of Arizona, of all ages and backgrounds,” says Kimball. Pruitt is encouraged about what lies ahead, saying the time is right for Arizona to begin to address the issues that are in front of us and become a very different state in the next few years. Most people he knows are willing to work to make Arizona better if they know goals have meaning and can be fruitful. “I think first, you have to ask, and secondly, you have to show that what you are doing is about adding value, making Arizona better for future generations and that what you are doing is sustainable.”
Tracy Bame with Former Secretary of State Hillary Rodham Clinton, Kellie Kreiser of Thunderbird School of Global Management and Emad Rizkalla of Bluedrop Performance Learning at the 2013 CGI America meeting announcing a new Commitment to Action, American DreamBuilder: The Women’s Business Creator
ARIZONA LEADRSHIP FORUM
Advantage Nov. 2013 – Feb. 2O14 • tempechamber.org
Great things ahead for Tempe By Tempe Mayor Mark Mitchell My first State of the City Address in November 2012 was a chance to reflect on Tempe’s goals and plans as our community moves forward toward a thriving future. I spoke about how our City Council has worked to prepare Tempe for better economic times and predicted that we were poised for significant economic growth. I was confident that our anticipated successes would bring returns on investment for everyone involved – especially our residents. My second State of the City Address will be an opportunity to express how far we have come. Since last November, we have been honored to announce and welcome exciting new ventures with big names and great plans. The highlight of these announcements came on May 24, when the City of Tempe and its partners revealed that our community will be home to the largest commercial development in Arizona’s history. Arizona State University, Ryan Companies and Sunbelt Holdings will develop a 20-acre site at Tempe Town Lake on the north side of Rio Salado Parkway, west of Rural Road. It will be leased to State Farm and will become one
of three national hubs for the insurance giant. Consider these project numbers: $600 million construction value; nearly two million square feet; five buildings; two parking garages; up to 60,000 square feet of retail space; and a 10-acre public plaza next to Town Lake. It’s an unprecedented development that will have untold benefits for our community. It is expected to serve as a catalyst for more highquality business growth. The City has also been working with Arizona State University to develop a hotel conference
The Tempe Chamber of Commerce in conjunction with the City of Tempe is pleased to present Mayor Mark Mitchell’s State of the City Address Thursday, Nov. 21, from 7:30 to 9 a.m. at the Tempe Mission Palms Hotel, 60 E. 5th St. The mayor will share his thoughts on the local social and economic climate along with his vision for the growth and future of Tempe and Arizona. This event provides a valuable opportunity to enjoy a breakfast with civic, business and political leaders of the Valley. Tickets are $50 for Tempe Chamber members and $70 for nonmembers. The event includes breakfast and the public is invited to attend. Learn more and register at www.tempechamber.org. State of the City is presented by Edward Jones. Platinum sponsor: Phoenix Sky Harbor Airport; Gold sponsor: Silicon Valley Bank; Silver sponsors: Arizona State University Office of Public Affairs, CenturyLink, Ryan Companies US, Inc. and SRP; Copper sponsors: APS, Cox Communications and Southwest Airlines; and Print sponsor: AlphaGraphics at Elliot and Kyrene.
center on the southeast corner of Mill and University, entitled USA Place. The $350 million development will feature a 330-room luxury hotel and a 30,000-square-foot conference center. The planning for the site also includes a residential component, as well as office and retail space. When completed, it is expected that USA Place could bring some 300,000 people to Tempe every year. The State Farm hub and hotel conference center are just a couple of the recent successes in bringing new jobs and development to Tempe. Others include GoDaddy, Direct Energy, Union Bank, Wells Fargo, AMC Theatre and several residential projects. In addition, the City Council acted in February to lease 106 acres of city land west of Town Lake for a future office building complex that could bring as many as 6,500 jobs. What do these new developments mean to you? First, they mean good jobs right in our back yard. They also mean sales taxes and property taxes that pay for the services we provide and the assets we maintain. Our Council’s priority is to build a better future for Tempe, and when reflecting over the past year, it is clear that we are off to an excellent start.
ARIZONA LEADRSHIP FORUM Te m p e C h a m b e r. o r g
T e m p e C h a m b e r A d va nta g e
As members of the Tempe Chamber of Commerce, you and your employees have access to exclusive discounts and programs. Through a variety of partnerships and affiliations, we are able to provide our members with discounts on legal services, identity theft protection, e-mail marketing and more, as well as provide access to educational programs and services. Visit www.tempechamber.org to take advantage of these great benefits.
Military Affairs Committee honors military personnel The Military Affairs Committee (MAC) of the Tempe Chamber of Commerce was founded over 30 years ago to facilitate a favorable and mutually rewarding relationship between the Tempe business community and military units here in the Valley. The Tempe Chamber is the only chamber in the Valley that has a program that rewards outstanding members of the military. For many units, it is their only civilian recognition/award program. Since its inception, MAC has dedicated itself to recognizing and honoring outstanding local active duty and active reserve military personnel. With more than 6,000 members of the armed forces living and working in the area, MAC plays an important role in showing the community’s support and appreciation for their service. Membership in the Military Affairs Committee is made up of men and women in the military, business and public sector who are active or retired. You do not need to be a Tempe Chamber member or in the military to serve on the committee. Membership includes men and women with a wide variety of occupations; active and retired military officers; and more. The one common thread of the membership is that they are all pro-military with a deep admiration for serving members of the military. MAC has a deep desire to give back a little something to the members of the military and to
T e m p e C h a m b e r A d v a nta g e
honor them and their families for the sacrifices they make on our behalf. From September through June, MAC hosts award luncheons to present awards and gifts that recognize the outstanding members of the military. The lunch is at no cost for them and a guest. At the lunch, the honoree is presented with a specially engraved plaque commemorating their award, plus they receive two free nights in a local hotel and a free meal for two at a local restaurant, along with some spending money. These hotel and food certificates are donated by various members of the Tempe Chamber. With these gifts, the honorees can enjoy a weekend with their families. Last month, MAC recognized and awarded ASU ROTC students from three units. Cadet Anthony Sandt of ASU Air Force ROTC, Midshipman Jolyon Gidari of ASU Navy ROTC and Cadet Katie Richardson of ASU Army ROTC each received a $500 scholarship from MAC to help with their educational expenses while they pursue their goal of dedicated service to the armed forces. This month, MAC will be awarding the “Don Plough Award” and the “Truman Young Award” to the Outstanding Officer and Enlisted Officer of the Arizona Air National Guard. For more information or an application to join the committee, contact Courtney at (480) 736-4281 or firstname.lastname@example.org.
Are you an effective networker? By the Tempe Chamber Business Development Council
Effective networking does not mean arriving first, dominating the appetizer table and chatting it up with your friends. A mixer or networking function where you don’t meet anyone new, expand your business or get a lead may be a lot of fun, but it’s not a smart use of a great opportunity for growth. The Tempe Chamber hosts three monthly mixers dedicated to network development: one morning mixer, one evening mixer and the “speed dating for business” Networking @ Noon luncheon. On top of that, larger events, ribbon cuttings, committee involvement and various workshops all provide great ways to grow your circle of peers, clients and resources. Here are some tips to help you maximize your networking experience. 1) Show up on time. Not half an hour early while the venue is setting up and not half an hour late when the program has already begun. Respect your time and that of everyone else for the best results. However, if other commitments keep you from arriving on time, better late than not showing up at all. 2) Meet new people! The biggest networking gaffe people make is to immediately seek out people they already know and then spend the whole time with them. Get out of your comfort zone and introduce yourself to some new faces. Also, ask people you know to introduce you to other attendees. If you see someone you know talking with someone you have not met, introduce yourself and enter the conversation. If you are talking
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with a new connection, introduce him or her to people you know and expand your circle. 3) Who are you? Be sure you have a clearly written name tag and business cards to hand out. Remember that you’re not there to add to your business card collection or hand out as many of your cards as possible – you’re there to meet the people themselves. 4) Be an active listener. Avoid reciting your elevator speech over and over. Start a discussion of a more personal nature like asking, “What do you do when you’re not working?” or “How long have you lived here?” Then listen to the answers. Quite often a strong business relationship develops as a result of common interests. 5) “What do you do?” means “What do you do that can benefit me or my customers?” When discussing your job, relate it to how you can provide a service or use. Rather than stating you are an expert in social media, you can say, “I make it easier for consumers to find your business.” Pique their interest and let them ask you for more information. 6) Follow up. Within 24 hours, call or e-mail the people you met at the event. Even if you don’t see an immediate connection, simply saying hello is important in order to be remembered in the future. Send an invitation to connect on LinkedIn. Too many people walk away from networking events feeling good but doing nothing. Take one decisive action based on something you learned or someone you met.
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The power of sponsorships Sponsorships arenâ€™t just for big business anymore. Small business owners are getting smarter, investing their money in the most effective ways possible, including advertising, marketing and sponsorships. It used to be that large, corporate entities cornered the market on sponsorship opportunities, aligning themselves with worthy organizations in order to positively impact public perception. The evolution of sponsorships is upon us. The Tempe Chamber offers a wide variety of sponsorship levels, allowing for even the smallest of businesses to take advantage of captive audiences and the highest quality networking. In addition to the general audience, the benefits associated with sponsorships offer a unique forum to â€œrub elbowsâ€? with representatives from larger, corporate entities, perhaps leading to that difficult foot-in-the-door contact. When taking into consideration the cost of a traditional, static advertisement, the chance
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to leap from the page and present a product or service in person is all the more powerful. The audience in attendance gets to know you and your product/service. Event sponsorship can be especially
effective as a marketing tool because it is a means of accessing a wide range of audiences including decision makers, CEOs, government entities and, of course, customers. It can be particularly beneficial
for companies that take part in international trade, because sponsorship transcends cultural and language barriers. Sponsorship that involves hospitality, like many Tempe Chamber events do,
always appeals to companies large and small. The advantages may involve exclusive networking opportunities like golf competitions or receptions of VIPs, which can be used to meet significant customers
and consolidate business associations. It is essential to appraise every opportunity and seek ways to marry them with your business and marketing goals.
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Why “networking” has caught fire By Melody Johnson, Vice President, Membership I’ll begin by sharing one personal story of networking success: I was introduced to my current position at the Tempe Chamber by one of my colleagues, Sean Donovan. I was introduced to Sean as a result of volunteering to serve on the Tempe Coalition to Reduce Underage Drinking and Drug Use. I was introduced to the Tempe Coalition through a former co-worker, Maria, who was introduced to the Tempe Coalition through a friend of hers that she bumped into at (you guessed it) a networking event. Networking, established to build business relationships, has now become a business model in its own right – with you as the consumer. So why buy? Whether you are looking for your next career, seeking your newest client or reconnecting with and refreshing a prior relationship, professionals have figured out that self-promotion begins by just showing up. In a sea of e-mails and postings, you want yours to get read. With a stack of resumes, you want yours at the top. When you, as a professional, are crystal clear about what you do and how you do it, word spreads and you get noticed. Networking is not sales. Don’t expect to open a discussion and close a sale in the same breath. Though entirely possible, it is certainly not probable. It is the process of turning strangers into friends and friends into customers. Networking is about you, not the product. When done properly, you will have a portfolio of contacts and connections that you can carry with you no matter where your career takes you.
Tempe Chamber welcomed new board members, committee chairs in July The Tempe Chamber of Commerce recently welcomed new board members and committee chairs for the 2013-2014 fiscal year at its Annual Luncheon event, which featured Steve Mihaylo as keynote speaker. New board members include Leslie Barrett, Children’s Dental Village; Nigel Brooks, TechKnowPartners; Hollie Costello, Make-AWish Foundation; Andrew Ching, City of Tempe; Misty Howell, Wells Fargo; Dave Long, Edward Jones; Randy Schultz, Four Peaks Brewing Company; and Liz White, APS. Outgoing board members Margaret Hunnicutt, Tempe Schools Credit Union; Phil Howard, Ernst & Young; and Tanya Chavez, City of Tempe, were also recognized and thanked for their service. The Tempe Chamber also introduced its incoming committee chairs as follows: Ambassadors: Harvey Gibson, Tempe Schools Credit Union; Business Excellence Awards: Jack Pisano, Veolia Transportation; Business Development Council: Peter Adams, Ping! Development; Business Owners Forum: Kelly Lorenzen, Morrison Vein Institute; Government Relations and Transportation: Vicki Kringen, TCH; Military Affairs: Ed Scannell; Women in Business Council: Dawn Hocking, TCH; Tempe Leadership: Tanya Chavez, City of Tempe; and Tempe Links: Jeff Heisner, BottomLine Media Coaching.
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Business Excellence Awards Nominations Sought The Tempe Chamber is now accepting nominations for the 2014 Business Excellence Awards. These awards promote the advancement of responsible business leadership in our community and publicly honor local businesses that demonstrate a passion for excellence. The purpose of the awards is to identify and recognize companies whose practices in business and employee development, community involvement and customer service exemplify excellence.
Last yearâ€™s recipients of the award were AlphaGraphics at Kyrene and Elliot and Statera. Values we look for in nominees include a demonstrated record of success and growth, community involvement and leadership, dedication to employees and commitment to customer service. All companies that are members of the Tempe Chamber are eligible for entry. Selfnominations are encouraged. Nominees will be sent complete application forms. All applying
companies will be reviewed by a panel of local business people and judged on their success in embracing these core values. The awards will be presented at the Breakfast for Chamber Champions in February 2014. Nominations must be submitted to the Tempe Chamber of Commerce by Monday, Nov. 18, 2013. Simply e-mail the name of the company and their contact information to Sean Donovan at email@example.com. Learn more about these awards at www.tempechamber.org.
Photos by Jay Mark
2013 Business Excellence Award recipient Statera
2013 Business Excellence Award recipient AlphaGraphics on Elliot and Kyrene. From left: Meegan, Eric and Steve Adams.
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Board of Directors Chairman of the Board: Jeff Mirasola Chair-Elect: Kristine Kassel Mary Ann Miller, President and CEO firstname.lastname@example.org Sean Donovan, Vice President, Media and Program Development email@example.com Julie Flanigan, Director of Finance firstname.lastname@example.org Shari Hodziewich, Membership Retention email@example.com Melody Johnson, Vice President, Membership Development firstname.lastname@example.org Courtney McIntyre, Director of Operations email@example.com Daniel Milner, Membership Development firstname.lastname@example.org Sachiyo Spires, Communications Director email@example.com
Treasurer: Tim Ronan Vice-Chairs: Aqeel Shahid, Liz White Immediate Past Chair: Jack Pisano Directors: Leslie Barrett, Nigel Brooks, Steve Eberhart, Misty Howell, Joe Hughes, Dave Long, Kelly Lorenzen, Mary Palomino, Laura Robertson, Randy Schultz, Jackie Thompson, Brian Wood Ex-Officios: Andrew Ching, Hollie Costello, Stephanie Nowack, Virgil Renzulli Committee Chairs:Â Peter Adams, Tanya Chavez, Harvey Gibson, Jeff Heisner, Dawn Hocking, Vicki Kringen, Dave Long, Kelly Lorenzen, Jack Pisano, Ed Scannell Tempe Chamber of Commerce 909 E. Apache Blvd. Tempe, AZ 85281 (480) 967-7891
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Arizona Technology Report Arizona Technology Council: The Voice of the Technology Industry
In This Issue Public Policy…Page 2 SciTech Festival…Page 4 Job Fair…Page 6
Who We Are The Arizona Technology Council is Arizona’s premier trade association for science and technology companies.
One Renaissance Square 2 N. Central Ave., Suite 750 Phoenix, Arizona 85004 Phone: 602-343-8324 Fax: 602-343-8330 firstname.lastname@example.org
The University of Arizona Science and Technology Park 9040 S. Rita Road, Suite 1150 (near I-10 and Rita Road) Tucson, Arizona 85747 Phone: 520-382-3281 Fax: 520-382-3299 email@example.com
President’s Message In addition to serving as president and CEO of the Arizona Technology Council, I recently began a two-year term as chairman of the Technology Councils of North America (TECNA), which is comprised of nearly 50 technology councils representing more than 16,000 member technology companies throughout the United States, Canada and Finland. There is much to do in my new role as I work to build lasting partnerships for the group. Some of those partners can be found on Capitol Hill as TECNA urges lawmakers to endorse public policy that can benefit our farreaching industry. One issue is research and development (R&D) tax credits designed to stimulate R&D activity Steven G. Zylstra, President and CEO, of U.S. companies by Arizona Technology Council reducing their after-tax costs. Companies that qualify for the credit can deduct 20 percent of qualified research expenditures above a base amount from their corporate income
Management and Staff Steven G. Zylstra
President and CEO
Senior Director, Membership Services
Executive Emeritus, Tucson Office
Leigh Goldstein Vice President, Operations and Events
Director, Membership Services
Executive Emeritus, Tucson Office
Director, Finance and Administration
Director, Tucson Office
Jeremy Babendure, Ph.D.
Merry Lake Merrell
Director, Arizona SciTech Festival
Director, Marketing and Communication
Ron Schott Executive Emeritus, Phoenix Office
Nov. 2013 – Feb. 2O14 aztechcouncil.org
taxes. Because it isn’t permanent, we have to advocate to extend the R&D tax credit on an annual basis. We already are working to convince Congress to make it a permanent tax credit so we don’t have to go back and fight for it every year or two. We’ve also been working with Congress and the IT trade association CompTIA on a bill called the Startup Act. It would allow companies that are pre-revenue and heavily investing in R&D while earning federal R&D tax credits to apply those credits against their payroll taxes when they don’t have any income taxes. Another area of focus is patent reform. Members face many patent issues, including patent trolls who are not adding any value to society. When a company wants to take its product to the marketplace, it can’t even though it developed the original concept because someone has patented around the company. TECNA also is working with CompTIA to create a State of the Industry report. The idea is to create individual state reports that will measure things like employment growth, R&D investment both by corporations and universities, patents — all components of an innovation ecosystem. TECNA is going to aggregate all those state reports into a national report to help enlighten our elected officials in Washington on the importance of the technology industry in the U.S. Yes, all of this effort ultimately adds value to membership in our group. But as important, it boosts the value of a major segment of our economy so we all have the chance to live better lives.
Doug Reid Director, Arizona Innovation Institute
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Council heads back to Legislature with measures to support tech industry With the start of the 2014 Arizona Legislature coming fast, the Arizona Technology Council already is shaping up efforts to have lawmakers reconsider two bills that would create a venture capital fund for early-stage technology companies and hike the cap for the refundable portion of research and development (R&D) tax credits. Council lobbyist Ken Quartermain is bullish on the outcome of the bills in the upcoming legislative session. “Last year our policy agenda was swamped by the ‘perfect storm’ of legislative politics in the form of the budget and Medicaid debate,” he says. “Unfortunately, the Speaker (of the House Andy Tobin) and Governor (Jan Brewer) were supporting two different sides of a fiercely fought debate on Medicaid and our agenda took a beating.” Quartermain’s optimistic outlook centers on the passing of the storm “and the fact that we have two-thirds of the legislature on record supporting our two measures.” The Council’s Public Policy Committee previously drafted a measure to create a $50 million early-stage, venture capital fund using tax credits for insurance companies that offset insurance premium taxes. The high-technology business investment fund
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would be capitalized over three years: $10 million in the first year and $20 million in each of the second and third years. Tobin introduced the measure as HB2646 in early February and it was assigned to the Commerce Committee. On Feb. 20, the committee passed the measure on a bipartisan vote of 7-2. The full House affirmed the bill on a 44-15 vote. In the Senate it was assigned to the Finance Committee. On March 21, that committee passed the bill on a 6-1 vote. Because of the fight over the 2014 budget and Medicaid expansion, there was no floor vote in the Senate.
Steps for Success In the 2014 session the Council will implement two strategic steps for success. First, members must meet with the governor early to encourage her to embrace our bill as one of her priorities and as a legacy issue. Second, it is anticipated the bill will be introduced in the Senate to clear the more difficult hurdles there. After that, the Council will work again with Tobin to fast track the bill onto the governor’s desk before the FY2015 budget is completed.
Under the plan, the $50 million would be reimbursed to the state from investment returns before distribution of net proceeds. For example, if Arizona issues the full $50 million in insurance premium tax credits, $50 million would be repaid through revenue generated from the investments before net proceeds are distributed to other investors. The long-term goal of the legislation is to return enough profits that funds would be permanently available for early-stage tech companies. Numerous states around the country have reached this milestone, resulting in a continuous flow of new capital to tech industries. The early-stage capital funds targeted industries for capital investment include health science, bioscience, semiconductor and electronics, information technologies, energy, and aerospace and defense. Such companies would have completed the research and development and test market stages, and be ready to initiate fullscale manufacturing and sales. Fund management would be done by the Arizona Commerce Authority, which annually would audit internal rates of return, total return and length of the investments, jobs created and average salaries, increases in exports from this state, goods and services purchased from companies in this state, state and local tax revenues, and collaborative investments in universities in this state. Results would be submitted annually to the governor, House speaker and Senate president.
The refundable R&D tax bill actually passed the Senate on the last night of the session on a 21-8 vote. Several days later, the governor vetoed the measure. In her veto message, Brewer expressed her desire to work with the Council to revisit the bill during the upcoming session. The Legislature first enacted the R&D tax credit for corporate income tax in 1992 and for individual income tax in 2001. In 2010, the Legislature created a “refundable” component to the tax credit tailored for newer R&D businesses, whose principal concern is cash flow. If they have tax burden to offset, the companies may choose a refund. In return, the state gets to discount on its R&D tax obligation of 25 percent. For example, if a company has $100 of R&D expenditures that qualify for the tax credit, it can receive $75 from the state and the remaining $25 is erased from the state’s R&D tax credit obligation. If passed, the annual cap for the refundable portion of the tax credit will increase from $5 million to $10 million in its first year. The amount increases to $15 million in the second year and for each subsequent year. For the $15 million refunded annually, the state lowers its R&D tax credit burden by $5 million. Currently, each participating pre-revenue company can employ no more than 150 workers. The Arizona Commerce Authority administers the program while the Internal Revenue Service and Arizona Department of Revenue have program oversight. In total for 2011 and 2012, 93 companies received 120 separate refundable R&D tax credits. The average annual wages paid were $80,000, which was 64 percent higher than the state average. The total R&D expenses for the companies getting the award were $141.1 million. That resulted in a return on investment of 1,410 percent, meaning $14.10 was spent on R&D for every dollar awarded.
More to Do The Public Policy Committee is considering several other measures for the next legislative session, Quartermain says: Uniform Commercial Code – Draft legislation would help ensure that financing for businesses is available and consistent with other states. Anticipated changes in the law would allow clarification on how the transaction debtor is named and the collateral accounted for as businesses expand or move from one state to another. Universities intellectual property – This proposed law would require the Arizona Board of Regents (ABOR) to maintain intellectual property policies that allow the licensing, assignment or other transfer of intellectual property owned by ABOR to third parties if the transfer is in the best interest of the state and the university system. This would be helpful for Arizona Technology Council members who are doing collaborative work with the state universities. Data centers – Last session the budget contained several tax-advantaged provisions to motivate the building, relocating, expanding and refreshing of data centers. The move already is bearing fruit as a number of data center operations have announced their intent to relocate to Arizona. Next session could entertain proposals to expand on last year’s successes.
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SciTech Festival can cast state’s communities in different light There’s no denying that the City of Glendale has moved its reputation needle from quaint little West Valley town to a mecca of professional sports fans. Thanks to the annual Arizona SciTech Festival, it has become known for something else. “The city came to view the festival as a key way to rebrand our community and the West Valley as well as to build a future pipeline of talented, skilled people who are excited about the education and career opportunities locally,” says Jeanine Jerkovic, administrator for business attraction/office, industrial and retail properties in the city’s Economic Development Department. Such reaction is becoming more common as municipalities from Flagstaff to Tucson and Yuma to the East Valley see new opportunities, thanks to the Festival. “As communities integrate science and technology as part of what they do, they An audience member captures a moment during a panel discussion at the Festival’s recent planning conference.
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become part of the community ‘brand’ and future economic vision,” says Jeremy Babendure, the festival’s executive director. That means communities, residents and corporate citizens become cognizant of the science, technology, engineering and math (STEM) components in what they do, he says. At this year’s festival, that ranged from Home Depot participating in the Mesa Public Schools SciTech Expo to Days of Discovery at the Arizona Renaissance Festival. In Glendale, the annual Chocolate Affaire was a chance to learn the science behind the sweet stuff while Midwestern University opened its doors to explore “Blood, Spit and Tears.” Jerkovic says from the city’s perspective, “the Festival brought an opportunity to change minds about how the average person views science,” and it also was an opportunity to engage citizens, corporations, universities and others with an idea that transformed individual agendas.
Don’t Forget Fun Babendure says the six-week event gets the public to willingly participate in activities so everyone can get more engaged in one way or another, no matter what profession. “We all can use a different perspective from time to time, and that’s exactly what the Arizona Science Festival offers,” Jerkovic says. “It is about embedding science into fun and embedding fun into science, making what might be intimidating topics cool, mainstream and exciting to everyone.” Although this year’s Festival has long passed if you go the calendar, its spirit remains as planning already is underway for 2014’s version. In fact, a daylong planning conference in early September brought together a cross-section of leaders from throughout the state who used panels to share their enthusiasm. More than 700 attendees gathered at the Scottsdale Center for the Performing Arts and the Scottsdale Civic Center Library for learning and networking, says Mike Phillips, the city’s public affairs manager. The result? “An energized corps of professionals prepared to launch fresh initiatives in education, business and government to strengthen the understanding and practice of STEM through the 2014 Arizona SciTech Festival,” he says. Anyone attending that day left with feelings of “ideas, inspiration and engagement — working together they can change the world,” Phillips says. The conference “offered a platform to engage new collaborators and link content providers with venues throughout the state, which translates into a stronger network and a more impactful Festival,” Babendure says. In addition, “there’s a lot of information now about how the idea of ‘play’ is an important part of the learning process and the Arizona SciTech Festival brings that back,” Jerkovic says.
Self-funded insurance plan is key part of members’ benefits program At a time when healthcare reform seems to be on everyone’s mind, it might be overwhelming for midsize technology firms to determine where to turn for benefit plans that are best for them and their employees. Besides, who could possibly understand the specific needs of the industry? For member companies of the Arizona Technology Council, the answer is a new benefits program that will become available Jan. 1. “Everybody right now is looking at all options” compared to a couple years ago, says Karen Goldberg, president of Corporate Benefit Solutions. Her company is the managing broker for the benefits program. The program primarily came about because companies need to offer exceptional benefits as they compete against large employers for new staff. “A lot of companies are midsize and feel they don’t have clout with insurance companies” to negotiate the best rates for their plans, Goldberg says. That especially is a problem when many employees come from large companies with top compensation packages. “Their expectations are high,” she says.
What makes the new benefits program especially attractive is the self-funded health insurance program that is its centerpiece and offered through EMI Health, which has 9,000 members in different industries’ self-funded pools in its home base of Utah. “They have experience to know how to create a stable program,” Goldberg says. Attractive to any insurer is the makeup of technology industry employees: younger, better educated and more highly compensated. “Their demographics are better,” she says. The plan will have risk tiers that place the insured in groups of people with similar health backgrounds. “We can use rate tiers to ensure pricing is appropriate for the group,” Goldberg says.
Lower Costs A major goal is to keep pricing down. Overall savings result from the fact that many of the fees and taxes usually required in fully insured health plans are absent. In addition, a three-year commitment by participants assures stability of the pool. That means over time the program should experience better cost control, Goldberg says.
A self-funded pool also offers more transparency, she says. EMI has an advisory board and group representatives are invited to attend quarterly meetings. Also, renewal changes are discussed and approved by the plan’s member companies. Actual pricing will be up to the employer. In this plan, Goldberg says, employers should contribute a minimum of 50 percent of costs. In addition, at least 75 percent of a company’s employees must participate. “It’s expensive to employees if some people are going to fall out,” she says. The plan focuses on companies with 10 to 200 employees and the firms can join at any time. Besides the health insurance component, Council members can participate in vision and dental plans from EMI. In addition, life and disability from Symetra will be available. Goldberg notes there is no requirement for companies to participate in all plans. Also, companies’ current advisors and brokers can help set up plans. “If they’ve got a good relationship with brokers, bring them into this process,” she says. For more information on applying, go to aztechbenefits.org or send an email to firstname.lastname@example.org.
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Filling the Gap
Job fair is way to keep pipeline flowing for IT One million technology jobs will go unfilled in the next five years. That’s the forecast of Prabakaran Murugaiah, CEO of TechFetch.com. As head of the Virginia-based global technology job portal, it’s his job to monitor hiring trends in the industry. Each time a tech company has a job to fill, “the gap between supply and demand is very high,” he says. To help remedy this problem, his company recently teamed with the Arizona Technology Council to stage a tech job fair. The response was so positive, both organizations plan to host another fair next year. Murugaiah expects there still will be a need next year to connect recruiters with prospective employees. Currently, there is only a 3.5-percent national unemployment rate in the tech market. But without the right connection between recruiter and job seeker, he feels these high-value jobs can
easily go offshore. If his prediction comes true, he says that’s $100 billion in job creation at stake. With increasing online activity, “people forget to have face-to-face meetings,” Murugaiah says. So when a person is laid off, he or she usually has no idea about what’s really happening in the market. The job fair fulfills a major need by allowing a person to hear directly from companies to learn “am I a good fit for the job?” Murugaiah says. For recruiters, it’s a chance to really find out if a prospect is “someone to come to do work on day one,” he adds.
Council Connection His preference is to host job fairs with technology councils because they know their local markets best. One intent of technology councils is “how do we create more jobs?” Murugaiah says. He decided
Arizona Commerce Authority representatives share information at the job fair.
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to partner with the Arizona Technology Council after meeting its staff while speaking at the recent annual conference of Technology Councils of North America (TECNA), which is comprised of nearly 50 technology councils. Of course, he sees the value of the Internet as a recruitment tool. Ten to 15 years ago, online searches were done by job title or resume. Murugaiah has ramped up the technology to the point of more than 40,000 tech jobs getting posted every month on TechFetch.com with more than 6,000 U.S. technology companies using it. There are different subscription plans for recruiters but posting resumes and applying for jobs are free. One of the draws is its proprietary QFetch technology that uses statistical analysis and matching techniques to connect recruiters with relevant candidates in 30 seconds. It “changes the way people use [recruitment] software,” Murugaiah says. While the word “Fetch” represents the acronym for the technology used by the company, there is another way of looking at it. “Finding talent,” he says, “is like playing with a puppy” to teach it to fetch.
Council members begin signing up for 401(k) multi-employer plan For CellTrust, the need existed for a high-quality, low-cost 401(k) plan without the administrative hassles. Apriva wanted the same plus a participant education program and more robust investment lineup than its previous plan. They are among the first companies to sign up for the Arizona Technology Council 401(k) Multiple Employer Plan, which allows them to tailor their own plan features such as eligibility, matches and vesting schedules. CellTrust has completed
the enrollment phase for its startup plan that will serve its 33 employees and Apriva is on boarding for the plan that will offer mutual funds to its 200-plus employees. The plan is offered in partnership with Scottsdale Wealth Management Group and is serviced by award-winning Transamerica Retirement Services. Using the buying power of Council’s more than 700 member companies, “you get all the advantages and flexibility of a standalone retirement plan sponsor with none of the cost or hassle,”
says Richard K. Schneider, CFP®, senior vice president at the Scottsdale firm.. Apriva’s leadership was especially impressed to learn the Council established an Investment Committee to oversee the MEP fund lineup. It will meet quarterly to make recommendations to keep, put on a watch list or remove any funds deemed underperforming. For more information, contact Scottsdale Wealth Management Group at 480-443-5427 or e-mail ScottsdaleWMG@UBS.com.
Online auction offers chance to learn from board members As owner of a service provider, Deborah Peck knows it’s not always easy to reach the key decision-makers. “It is very hard to get anyone at the C-suite’s attention unless you have another avenue to meet them,” she says. So when she had the chance to bid in an online auction on lunch with a member of the Arizona Technology Council board of directors, she jumped at the chance – three times. Peck is president and CEO of Scottsdale-based Seity Insight, a consulting firm that performs organization analysis of employees at all levels to identify causes of issues while improving value of the company. To get the feedback she wanted, she bid on lunch with David Crowe, president and CEO of Tucson Embedded
Systems; Charles Layne, president and CEO of Signature Technology Group; and Roger Vogel, principal of Metrios Management Consulting. So what did they talk about? While much of it was confidential, Crowe “was very innovative with some suggestions he made on how to use what I do in a different way and offered to help me with that” while Vogel is interested in using her skills in his new business. Leigh Goldstein, the Council’s vice president of operations and events, says the fund-raiser was so successful, it will become an annual summer event. “I would do this again and suggest that others get more involved,” says Peck, who for the past three years also has served as an ambassador for the Council.
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Index Index by Name
Dipman, Grant, 18
Mask, Clate, 10
Rivenburgh, Diana, 25
Antonuccio, Laura, 24
Francis, Juanita, 42
McClure, Wes, 18
Sandt, Anthony, 48
Armendariz, Frank, 18
Gidari, Jolyon, 48
Mihaylo, Steve, 52
Schneider, Richard K., 63
Babendure, Jeremy, 60
Glasper, Rufus, 38, 44
Miles, Stephen A., 66
Schweikert, David, Congressman, 12
Bame, Tracy, 40
Goldberg, Karen, 61
Mitchell, Mark, Mayor, 47
Seleznow, Steve, 41
Beyer, Thomas, 30
Goldstein, Leigh, 63
Murphy, Kiersten, 24
Stapp, Mark, 14
Binkley, Kevin, 32
Govig, Todd, 18
Murphy, Michael, 12
Stockdale, James B., Admiral, 38
Black, J. Stewart, 25
Gregersen, Hal, 25
Murset, Gregg, 12
Sturm, Mary Ann, 10
Bruno, David, 9
Hall, Kirsten, 18
Murugaiah, Prabakaran, 62
Suggs, Sarah, 42
Bryant, Georganne, 10
Howard, Ben, 18
Nillen, Dan, 16
Vogel, Roger, 63
Calbert, Bo, 18
Jackson, Becky, 26
O’Reilly, Tim, 12
Waddington, Greg, 18
Clinton, Bill, President, 40
Jerkovic, Jeanine, 60
Openden, Danny, 42
Wallace, Patricia, 18
Collins, Jim, 38, 42
Johnson, Melody, 52
Orr, Mike, 14
Weidenhamer, Deb, 11
Coor, Lattie, Ph.D., 42, 44
Kinicki, Angelo, 18
Peck, Deborah, 63
Williams, Susan, 18
Corral, Jessica, 18
Klein, Joshua, 25
Phillips, Mike, 60
Zhang, Yanhua, 11
Cramer, James J., 25
Layne, Charles, 63
Pruitt, Doug, 42, 44
Zylstra, Steve, 57
Crowe, David, 63
Levine, Susan, 26
Quartermain, Ken, 58
DeMaria, Michael, 12
Maio, Keith, 37, 42
Richardson, Katie, 48
China Association of Auctioneers, 11
K1 Speed Phoenix, 4
Choice Hotels International, 12
Index by Company Ahwatukee Foothills Chamber of Commerce, 28
Scottsdale Wealth Management Group, 63
Clinton Global Initiative, 40
Seity Insight, 63
Alliance Bank of Arizona, 2
Corporate Benefit Solutions, 61
Signature Technology Group, 63
All-State Legal, 11
Cox Business, 67
DHR International, 9
Maricopa Community Colleges, 38, 44
Maricopa Workforce Connections, 18
Driver Provider, The, 25
McCarthy Building Companies, 18
Economic Club of Phoenix, 28
Mercedez-Benz of Scottsdale, 68
Eide Bailly, 42
Mesa Chamber of Commerce, 28
Metrios Management Consulting, 63
Frances Boutique, 10
Miles Group, The, 66
My Job Chart, 12
Arizona Chamber of Commerce and Industry, 28 Arizona Commerce Authority, 18 Arizona Community Foundation, 41 Arizona Hispanic Chamber of Commerce, 28 Arizona International Growth Group, 28 Arizona Leadership Forum, 35 Arizona Small Business Association, 28 Arizona State University, 14, 42, 47
Copper & Gold Foundation, 40 Freeport-McMoRan Copper & Gold, 38, 40, 43
National Association of Women Business Owners, 28 National Bank of
Arizona Technology Council, 27, 28, 57
Gallagher & Kennedy, 24
Auction Systems, 11
Glendale Chamber of Commerce, 28
North Phoenix Chamber of Commerce, 28
Beyer Management Consulting, Inc., 30
Glendale, City of, 60
O’Reilly Hospitality Management, 12
Bibby Financial, 8
O’Connor House, 42
Bink’s Midtown, 32
Govig & Associates, 18
Octane Raceway, 13
Bistro 24, 32
Grand Canyon University, 51
Peoria Chamber of Commerce, 29
Phoenix Art Museum, 34
Blue Cross Blue Shield of Arizona, 46
Chamber of Commerce, 28
Arizona, 36, 37, 38, 42
Phoenix Philanthropy Group, The, 38, 39
BMO Harris Bank, 16
Greater Phoenix Leadership, 42, 44
Cambria Suites, 12
Hava Java, 32
Phoenix Suns, 7
Headfarmer LLC, 18
Phoenix Symphony, The, 13
Center for Leadership Development and
Holmes Murphy, 4
Regus, 18, 31
Hospice of the Valley, 26
Center for the Future of Arizona, 44
Hotel Valley Ho, 32
Ritz-Carlton, 18, 32
Central Phoenix Women, 28
HR Choice, 18
Ryan Companies, 47
Chandler Chamber of Commerce, 28
SCF Arizona, 3, 10
Children’s Museum of Phoenix, 31
Scottsdale Area Chamber of Commerce, 29
Research & Resource Center, 42 Stanford Graduate School of Business, 66 State Farm, 47 Stoney-Wilson Business Consulting, 25 Sunbelt Holdings, 47 Sundt Companies, The, 42 Surprise Regional Chamber of Commerce, 29 Symantec, 33 TechFetch.com, 62 Tempe Chamber of Commerce, 29, 47 Tempe, City of, 47 Thunderbird School of Global Management, 40 Transamerica Retirement Services, 63 Tucson Embedded Systems, 63 VincentBenjamin, 18 W. P. Carey School of Business, 14, 18 Waste Management, 55 West Valley Women, 29 Wilson Electric, 18 Women of Scottsdale, 29 University of Phoenix, 56 ZuZu, 32
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N o v e m b e r 2013
A Candid Forum
Wanted: Leadership Advice
Nearly two-thirds of CEOs do not receive outside leadership advice — but nearly all want it by Mike Hunter The old saying “It’s lonely at the top” seems to be as true today as ever. The 2013 Executive Coaching Survey recently conducted by Stanford University and The Miles Group found that nearly two-thirds of CEOs do not receive coaching or leadership advice from outside consultants or coaches, and almost half of senior executives are not receiving any, either. “What’s interesting is that nearly 100 percent of CEOs in the survey responded that they actually enjoy the process of receiving coaching and leadership advice, so there is real opportunity for companies to fill in that gap,” says David F. Larcker, the James Irvin Miller Professor of Accounting and Morgan Stanley Director of the Center for Leadership Development and Research at the Stanford Graduate School of Business, who led the research team that studied what kind of leadership advice CEOs and their top executives are — and aren’t — receiving, and the skills that are being targeted for improvement. “Given how vitally important it is for the CEO to be getting the best possible counsel, independent of their board, in order to maintain the health of the corporation, it’s concerning that so many of them are ‘going it alone,’” says Stephen Miles, CEO of The Miles Group. “Even the best-of-the-best CEOs have their blind spots and can dramatically improve their performance with an outside perspective weighing in.” Key findings from the survey — which polled more than 200 CEOs, board directors and senior executives of North American public and private companies — include: There is a shortage of advice at the top. Nearly 66 percent of CEOs do not receive coaching or leadership advice from outside consultants or coaches, while 100 percent of them stated they are receptive to making changes based on feedback. Nearly 80 percent of directors said their CEO is receptive to coaching. CEOs are the ones looking to be coached. When asked, “Whose decision was it for you to receive coaching?” seventy-eight percent of CEOs said it was their own idea; twenty-one percent said coaching was the board chairman’s idea. Seeing this as a positive trend, Miles says, “Becoming CEO doesn’t mean that you suddenly have all the answers, and these top executives realize that there is room for growth for everyone. We are moving away from coaching being perceived as ‘remedial’ to where it should be something that improves performance, similar to how elite athletes use a coach.” Coaching “progress” is largely kept private. More than 60 percent of CEOs responded that the progress they are making in their coaching sessions is kept between themselves and their coach; only a third said that this information is shared with the board of directors. Miles believes there is beginning to be less secrecy as coaching is starting to lose its stigma. Larcker, although acknowledging a need to treat much of the coaching discussion as confidential, notes that “keeping the board informed of progress can improve CEO/board relations.” How to handle conflict ranks as highest area of concern for CEOs. When asked which is the biggest area for their own personal development, nearly 43 percent of CEOs rated conflict management
N o v e m b e r 2013
skills the highest. “How to manage effectively through conflict is clearly one of the top priorities for CEOs, as they are juggling multiple constituencies every day,” Miles says. “When you are in the CEO role, most things that come to your desk only get there because there is a difficult decision to be made — which often has some level of conflict associated with it. ‘Stakeholder overload’ is a real burden for today’s CEO, who must deftly learn how to negotiate often conflicting agendas.” The top areas that CEOs use coaching to improve are sharing leadership/delegation, conflict management, team building, and mentoring. At the bottom of the list are motivational skills, compassion/empathy, and persuasion skills. “A lot of people steer away from coaching some of the less tangible skills because they are uncomfortable with touching on these areas or really don’t have the capability to do it,” Miles says. “These skills are more nuanced and actually more difficult to coach because many people are more sensitive about these areas. However, when combined with the ‘harder’ skills, improving a CEO’s ability to motivate and inspire can really make a difference in his or her overall effectiveness.” The Center for Leadership Development and Research at Stanford Graduate School of Business gsb.stanford.edu/cldr The Miles Group
The Center for Leadership Development and Research at Stanford Graduate School of Business seeks to advance the understanding and practice of corporate governance and executive leadership. Stanford University’s Rock Center for Corporate Governance is a joint initiative of Stanford Law School and Stanford Graduate School of Business. The Miles Group advises top global corporations through CEO succession, executive transitions, board assessment and training, and talent development.
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