A publication of
Effective investing Clients of Kirr, Marbach learn the value of its experience
2 The Business Connection November 2012
Business Indicators for Bartholomew County
Columbus Container . . . . . . . . . . . . . . . 6 Morton Marcus column . . . . . . . . . . . . . 8 Around the watercooler . . . . . . . . . . . . . 8
On the move . . . . . . . . . . . . . . . . . . . . 10 The fiscal cliff . . . . . . . . . . . . . . . . . . . 11 Business leads . . . . . . . . . . . . . . . . . . . . 12 Mark McNulty column . . . . . . . . . . . . 13
On the cover: Mickey Kim, left, and Mark Foster of Kirr, Marbach & Co. Photo by Andrew Laker. Story page 4. Comments should be sent to Doug Showalter, The Republic, 333 Second St., Columbus, IN 47201 or call 812-379-5625 or email@example.com. Advertising information: Call 812-379-5652. ©2012 by Home News Enterprises All rights reserved. Reproduction of stories, photographs and advertisements without permission is prohibited.
Sep 12/ Sep 12/ Description Sep 12 Aug 12 Sep 11 Aug 12 Sep 11
41,996 42,121 38,593 -0.3
39,711 39,606 35,872 0.3
Unemployment Rate (pct)
5.4 6.0 7.1 — —
Housing Units Permitted
— — — — — — Center for Business and Economic Research, Ball State University
4 The Business Connection November 2012
Kirr, Marbach invests in value
Long-term view and economic perspective build clients’ portfolios By Barney Quick
The list of traits that make Kirr, Marbach & Co. noteworthy is rather lengthy: its focus on value rather than growth, the national recognition it’s received relative to its size, its location in a smallish Midwestern city rather than a metropolis, the original research it performs, and the stake it has in the decisions it makes for its clients. Taken
together, these qualities speak to an appreciation of what effective investing really means to the lives of those engaged in it. A definite theme emerges in the firm’s own materials as well as in its team members’ statements in the media. The recurring message is that sound wealthbuilding requires patience, calmness and a long-term perspective. Mark Foster, chief investment officer and one of the majority owners, speaks of the irreplaceable role of experience. “There’s no substitute for seeing a few up-cycles and down-cycles,” he observes. “My own personal experience is that you need about 15 years in this field to develop a sense of how
trends play themselves out.” That experience has led Foster and the other nine team members to place a primacy on value. He distinguishes that approach from a growth orientation. “The growth approach is more about how fast a company can grow rather than what you pay for it.” Obviously, anyone buying shares of a company wants to see it grow, but Foster cites the recent example of Facebook’s IPO. “It was overvalued, but once the hype died down, the relevant question was, ‘What was it really worth?’” He says, “The value focus has been our philosophy for over 37 years. We want to be able to buy into a company
photos by Andrew Laker
at a substantial discount relative to what someone would buy the entire company for.”
Banking on motivation
This view is why Kirr, Marbach emphasizes opportunities that don’t have a lot of conventional appeal, such as spinoffs, companies restructured after bankruptcies or companies with new management. These types of businesses have an extra motivation to operate with optimum efficiency. “Presumably, if we think a company is worth $40 a share and it’s selling for $20, there’s not a lot of downside risk,” he explains. A lot of people are noticing the results of this strategy. Foster was named the All-Cap Manager of the Year by Emerging Manager Monthly for 2010. Kiplinger’s Personal Finance deemed the Kirr, Marbach Partners Value Fund a top performer over a three-year period in its September 2012 issue. Also in September, the Wall Street Journal named it a “category king” in the multi-cap core category. The firm, while national in scope, has deep Columbus roots. David Kirr and Terry Marbach oversaw stock investments for Irwin Management for 10 years when, in 1975, that group decided to move away from that area of activity. They decided to continue their investment work in the city and set about accumulating a roster of clients and establishing a reputation. Kirr is still involved on a part-time basis. Marbach retired in 1990. Foster, a Columbus native, completed a B.S. in finance from Ball State in 1979 and worked for various banks in Evansville and Indianapolis. He joined Kirr, Marbach in 1987. The other current majority owner and chief operating officer, Mickey Kim, is a native of the Chicago area. He earned an MBA from the University of Chicago and worked for an investment firm there. His network of industry contacts brought him to Columbus in 1986. “I thought I’d be here about five years,” he says, noting that the decision to stay occurred “probably when my wife and I started raising a family.” The firm grew on the basis of its model of separately managed accounts for several years. In 1998, it created its own mutual fund.
November 2012 The Business Connection 5
Research comprises a major portion of the working day for the Kirr, Marbach team. “We don’t have a home office telling us, ‘Here’s the buy list and the sell list,’” says Foster. They start the day looking at new developments in the companies in their clients’ portfolios. “After we get that maintenance stuff done, we get into research on new companies,” Foster explains. That takes the form of watching management in action via webcasts and conference calls, as well as reading financial reports. “We’re formulating the questions we need to ask management to find out where the company is going.” Two terms that recur in Kirr, Marbach’s literature and media statements, “eating our own cooking” and “having skin in the game” reflect its philosophy of being invested in its own fund. While that may strike an outside observer as an obvious sign of faith in one’s own investing skills, Kim says it’s “more rare than it ought to be.” He says many fund managers have no such stake in their decisions on clients’ behalf. Kim acknowledges that marketing is “an issue for a firm our size. We don’t have near the advertising budget of a firm such as Fidelity.” He writes regular columns for Indianapolis Business Journal and The Republic, which enhance Kirr, Marbach’s visibility. They consist of plain-spoken advice on investing and overall life planning. The recent national recognition has built on itself some-
what. Still, according to Kim, much of the firm’s growth comes from word-ofmouth referrals. The current economic climate of uncertainty doesn’t unduly disturb the Kirr, Marbach team. “You have to look at companies that can grow in any environment and hope you get a little help,” says Foster. Kim adds that “there are a thousand things that are unknowable and can paralyze you if you let them.” He cites the fact that Kirr and Marbach started the firm on the day after the fall of Saigon to North Vietnam. Foster says of the downturn of 2008, “It wasn’t a pleasant time, but we had the opportunity to buy some companies that were valued at the lowest prices in probably over a decade.” Experience allows a fund manager to distinguish short-term fads from longterm trends. “A lot of the hot managers in the late 1990s were in their 20s, and that was all they’d known,” says Kim. “They looked smart at the time, but it didn’t end well.” Such trend discernment provides an investor an economic perspective on the cultural history of the country. “That’s the intellectually rewarding part of this work,” says Kim. He offers a Mark Twain quote: “History doesn’t repeat itself, but it rhymes.” Encouraging clients to be patient and calm throughout financial cycles is a matter of education. For Foster, there’s immense reward in hearing a client say, “‘Not only have I done well, but I’ve learned a lot.’”
6 The Business Connection November 2012
At the box office
Customer can always get what he wants at Columbus Container
can call it a niche if you want. I call it survival. My goal is not to make every box in the world.” He notes that “we do not price on market. We focus on smaller orders, delivered as needed. If the big companies take a rush order, they put all their other customers behind. I charge customers more and save them money. They recognize the total value of what we offer. If we can cut their inventory costs and supply various sizes of boxes, we have an advantage.”
By Barney Quick
Delivering results to customers and expecting them from staff and suppliers: It really is as simple as that at Columbus Container. The company was founded on the principle that finding out exactly what a customer wants and providing that is always a winning proposition. That has translated into being a comparatively small company in the box industry, but being so well-equipped — not only in terms of plant floor machines but capacity to deliver in a truly just-in-time fashion — as to provide whatever the customer specifies. The company’s commitment to customer service was even highlighted in a recent article in The White Sheet, a
Over 2,000 relationships CEO Robert Haddad of Columbus Container.
Chuck Surges is facilities director.
national trade publication in the paper industry. “Asset utilization 24-7 does not mean you can always serve customers on a rush basis,” asserts CEO Robert Haddad. “Some of our machines are idle sometimes. I know that, and I don’t care. We have two of almost everything. The fact that a machine may not run a few hours a day is not as important as
having it when you need it.” When Haddad visits his customers’ facilities, he tells them, “I don’t want to see what you’re buying now. I want to see what you need.” He knows a lot of executives at those companies “because we get involved in their businesses.” He says the company made a decision early on not to directly compete with the industry’s largest players. “You
Repeat orders are key to Haddad’s strategy. “You can’t build a business like this without building relationships.” He describes the company’s customer base as ranging “from roadside stands to giant corporations. We sell to popcorn makers, lawn mower makers, Rose Acre Farms, Dorel. We have over 2,000 customers.” Haddad knows his field in all its facets. “I started working in a box factory to make money for college,” says the
November 2012 The Business Connection 7
Oklahoma native. Then came Air Force service, a stint with Shell Oil and a sales position with a large box manufacturer. That’s what he was doing when he arrived in Columbus. He started Columbus Container in 1975. The 79-year-old son of a Lebanese immigrant was inspired by the city’s legacy of entrepreneur families and industrial dynasties. He wishes that model was still as prevalent in American business as it used to be. “Today it’s hard to compete against the giants in any industry.” His daughter, Tammy Burton, and her husband and son work for the company. He doesn’t specify what their positions are, nor those of anyone else who enters his open office doorway, a frequent occurrence. “We don’t really have titles here,” he says. “Everybody does what they’re supposed to do.” The company’s departments are design, sales, quality, production and transportation. Besides the Columbus headquarters, it has plants and warehouses in Seymour, Edinburgh, Jasper, Indianapolis and Flora, Ill. It maintains a fleet of trucks to have greater control over deliveries. “A president is on the bottom of
Haddad and Surges confer in the shop.
his company, not the top,” Haddad explains. “You need passionate and heated discussions about meeting objectives. Everyone must be clear about everyone else’s strengths and weaknesses.” Otherwise, he says, communication breaks down and dysfunction permeates the company’s culture. “I know about every quality issue in this company.”
Seeing both sides
photos by Sharon Shipley
He brings such expectations to his relationships with vendors as well. “I buy and sell. I see both sides of it.” Regarding the willingness to pay for total value, he says, “I don’t need cheaper glue. I want better glue. I gave a lecture on service to Indiana State’s packaging school’s first graduating class. I told them, ‘If you graduate and come to see me and say, ‘I have a
cheaper glue,’ you won’t get in to see me. If you say it’s better, I’ll say, ‘Come on in; let’s talk.’” Haddad becomes particularly animated when the subject turns to the degree of opportunity America offers anyone who can see it. “The early waves of immigrants who came here were willing to start in anywhere and really work,” he says. “They knew what was possible. I don’t know if the entitlement generation can make it, frankly.” The staff generally works 40-hour, four-day weeks, staggered from Monday through Friday. If extra time is needed to act on the company’s much-admired service flexibility, that is factored into the schedule. “Our motto is ‘Serve before you’re served,’” explains Haddad. There is some risk in his model, which is fine with him. “If it’s fourth and one, I’ll take the ball.” The Columbus Container way of doing business is all the more remarkable given the volume of boxes going out from its facilities. “We make almost 2 million boxes a day here,” Haddad notes. “By the way, they’re not free.”
8 The Business Connection November 2012
Auto industry strengthens economy The data are in from the federal Bureau of Economic Analysis (BEA). Indiana had a good year in fiscal 2012 (the 12 months ending in June this year). We have known for several weeks that the state surplus looks good. Part of that is due to stringent economies forced by the state budget process. Morton Marcus The balance is due to an improved economy, confirmed by BEA, which boosted state revenues. How good was the economy in fiscal 2012? This state, like most others, uses personal income as its best indicator of economic health. During the year that began in July 2011, BEA reports Indiana’s personal income advanced by 4.2 percent. The nation, by contrast, grew by only 3.3 percent.
Indiana led all five states in the Great Lakes region. Michigan and Ohio also exceeded the national growth rate, but Illinois and Wisconsin did not. As the fiscal year ended, Indiana ranked 11th in the nation in the rate of growth for personal income. Where did this growth come from? It did not come from unemployment compensation, which fell by 31 percent as jobs were gained by some and other Hoosiers exhausted their eligibility for assistance while out of work. The growth did not come from state and local government employment, where the budget crisis allowed total earnings by workers in this sector to increase by a mere 0.3 percent. Let’s not be coy. Indiana’s growth in personal income came largely from an 8.9 percent increase in earnings paid to workers in durable goods manufacturing.
When you think of durable goods manufacturing and couple it with Indiana, Ohio and Michigan, what do you get? I come up with manufacturing for the automobile industry, the giant that continues to dominate the economies of those three states. We all know what happened. Two of the three domestic titans were failing and in danger of going out of business, leaving hundreds of thousands of workers across the nation in danger of losing their jobs. In an unprecedented step, the federal government took charge, restructured the anemic firms and prevented an economic meltdown. Yes, Indiana’s good economic performance in fiscal 2012 may be the result of the federal restructuring program that saved General Motors and Chrysler. This is ironic since prominent Hoosier politicians opposed that program as bad economics and morally
Metal manufacturer to open plant SHELBYVILLE — Faeza Alloyers U.S.A., a metal alloys manufacturer and fabricator, announced plans to locate its first U.S. facility here, creating up to 47 new jobs by 2015. The Chalco, Mexico-based company, which specializes in producing alloys with zinc and aluminum bases for the automotive industry, will invest $7.56 million to construct and equip a 36,000-square-foot facility on its 11-acre campus in 1200 Enterprise Site, a state certified shovel ready site in Shelbyville. As part of the project, Faeza plans to purchase new manufacturing machinery and information technology equipment for the facility. The company, which currently has four facilities in Mexico, plans to begin hiring production and support associates next spring in preparation for the anticipated opening of the facility in the summer of 2013.
Hangar work continues PERU — Construction is proceeding on time for a hangar at Grissom Air Reserve Base in northern Indiana, where a company plans to bring in large jets for painting and planners hope to attract more aviation businesses. The $13.8 million project is expanding a hangar by 50,000 feet to accom-
Around the watercooler
questionable government intervention in the private market place. Whether or not the federal action was philosophically sound, it worked. Today’s auto industry is stronger than before, and an economic catastrophe has been averted. Indiana, Michigan, and Ohio are the beneficiaries of the federal intervention, although few of our political leaders are willing to acknowledge their misguided opposition. The next time you hear how well Indiana is doing, it is worth asking what aspects or sectors of our economy are doing well and why that is happening. As in the farm yard, the rooster doing the crowing may not be responsible for the increase in egg production. Morton Marcus is an independent economist, writer and speaker formerly with the IU Kelley School of Business.
distribution center has started operations with more than 1,000 workers. The building with more than 1 million square feet opened in a business park at the former Indiana Army Ammunition Plant in Jeffersonville. The online retailer has between 1,200 and 1,600 employees working two shifts at the center. About 300 to 500 trucks a day are expected to come and go when it’s fully operational. The Jeffersonville warehouse is Amazon’s fifth large facility in Indiana. Other centers are in Indianapolis, Whitestown and Plainfield.
Clothing retailer Ascena to expand
modate Boeing 747s and other large planes serviced by Texas-based Dean Baldwin Painting. Baldwin Painting plans to hire about 200 people to work on some 200 airplanes a year at what was Grissom Air Force Base until it was downgraded in 1994. The base midway between South Bend and Indianapolis has a runway
that’s more than 2 miles long. The company has facilities in New Mexico and Texas and works for several major airlines, including United, Southwest, US Airways and Air Canada.
Amazon warehouse opens JEFFERSONVILLE — Officials say Amazon.com Inc.’s new warehouse and
GREENCASTLE — A national retailer of women’s and girls clothing is planning a $34 million expansion that could bring more than 240 new jobs to west-central Indiana by 2018. Ascena Retail Group said it will invest primarily in new equipment and systems to turn its Greencastle complex into its primary e-commerce distribution site. The Suffern, N.Y.-based company will spend another $3 million to add 40,000 square feet to its existing 794,000-square-foot Greencastle facility. Ascena plans to begin hiring new see watercooler on page 9
chamberconnection November 2012 Growing BUSINESS. Growing people. Monthly publication of the Columbus Area Chamber of Commerce • 500 Franklin Street • Columbus, IN 47201 • 812-379-4457
Spend the Holidays With Us
olumbus has everything that you need this holiday season, whether it is unique gifts for children, educational toys, one-of-a-kind art, fabulous dining or boutique hotels for your guests. We hope that you will join us in supporting businesses that support our community.
Get your daughter ready for family photos in this red velvet dress by Trish Shully and a hair bow by Darling Divas (made in Columbus), available at O’Child Children’s Boutique on Washington Street. Nothing is cuter than these little corduroy pants and bear polo (by Mudpie) to make your son look his best. To complete the family photo, stop by Lockett’s Ladies Shop for your perfect outfit. Special thanks to Bob Anderson from Still Frames Photography for the photos. Models are Reese Bean, Nolan and Hudson Ley and Tricia Webb. Thanks also to The Inn at Irwin Gardens, Claudia’s Flora Bunda, Lockett’s Ladies Shop, Columbus Area Visitors Center, Viewpoint Books, Hotel Indigo, O’Child Boutique and Geri Handley.
Our model, Trish, is ready for a holiday party in this lovely belted cowl neck iridescent patterned top by Frank Lyman, found at Lockett’s Ladies Shop. Lynne Hyatt at Lockett’s is ready to serve all your holiday dress needs at her new location at 426 Washington St.
Get your home ready for company with floral arrangements like this one from Claudia’s Flora Bunda. Claudia’s does custom work to fit anyone’s décor.
Check out the selection of stuffed animals, books and other unique toys at Viewpoint Books that are sure to please anyone on your holiday list. Shop online at viewpoint. com or stop by the store at 548 Washington St.
Win $1,000 this holiday season
Support businesses that support the community and win $1,000 in prizes. Shop at any of the companies that display this logo or visit www.columbusareachamber.com/holiday for a printable list of participating merchants.
How to enter: • Save your receipts from November 1 to December 17. • Turn in those receipts to the Chamber (500 Franklin St.) or scan and email to firstname.lastname@example.org by December 19. • Get one chance to win for every $100 in receipts turned in. • Double your entries by submitting receipts from locally owned or operated businesses marked with*.
Miles, doggie ambassador at Hotel Indigo welcomes out-of-town guests or those just looking for a weekend staycation in their hometown. After those family pictures, you might just need a break. With the holidays quickly approaching, you’re sure to have guests, so check out Hotel Indigo for the perfect boutique hotel stay. If you’re looking for something a little more like home, visit The Inn at Irwin Gardens.
If you need a hostess gift or perhaps a memento from Columbus, the Visitors Center has one-of-akind gifts that would make lovely additions to anyone’s home.
Why $pend the Holidays with Us?
According to a study completed by Civic Economics in 2008, just a small shift in behavior locally can have a tremendous potential economic impact on our community. If every person in Bartholomew County made a conscious effort, just one time out of 10, that before they left the community or shopped online they chose to shop locally, it would create an additional $15.8 million in economic activity. This 10% shift in consumer spending could also lead to the creation of 187 additional jobs in Bartholomew County. The Chamber of Commerce on behalf of our retail members and restaurant members is trying to increase awareness about how this modest change in consumer behavior can lead to significant impact. Please watch for the logo above as you shop and dine to make a big difference in our economy. “INCREASE YOUR SHOPPING LOCALLY BY JUST 10% AND YOU’LL HELP CREATE 187 NEW JOBS WITH A $15M IMPACT TO OUR LOCAL ECONOMY.”
New members Boy Scouts of America Bob DeWar 812-657-5228 email@example.com 5625 E. State Road 46 Bloomington, IN 47401
Dingledy Consulting LLC Matt Dingledy 317-450-1346 firstname.lastname@example.org 8152 Meadow Bend Drive Columbus, IN 47201
Donna Kriete 260-665-7499 email@example.com 4625 Progress Drive, Suite B Columbus, IN 47201
Anthony Blair – Life Coach Anthony Blair 812-565-2711 firstname.lastname@example.org 3129 25th St. Columbus, IN 47203
Economic Outlook Breakfast 7:30 to 9 a.m. Nov. 2 Columbus Learning Center auditorium The breakfast is a collaboration among the IUPUC Business Division, IU Kelley School of Business and Columbus Area Chamber of Commerce. The cost is $20 for all attendees. Register online at www.columbusareachamber.com/events. At the breakfast, Indiana University Kelley School of Business economists will give their best predictions for the national, state and local economies.
The Indiana Business Research Center, a unit in the Kelley School of Business at Indiana University, provides and interprets the economic information needed by the state’s business, government and nonprofit organizations, as well as users of such information throughout the nation. The IBRC maintains databases on numerous topics, such as income, employment, taxes, sectors of the economy, education, demographics and a host of other economic indicators for the nation, the state and local areas.
Dancing with the Stars ... Columbus Style — live at Yes Cinema Family School Partners and Children Inc. would like to invite you to attend this Red Carpet Preview Event, 4:30 to 6 p.m. Nov. 16 at Yes Cinema. Networking begins at 4:30 p.m., but be sure to be there by 5 p.m. for the star-studded arrival of the dancers. Then hear from the dancers and maybe even see a few dance moves.
Dancing with the Stars is a Children Inc. and Family School Partners partnership. Don’t miss this great preview event — you’re sure to see some familiar chamber faces among the dancing stars. Seating is limited. Please register online at www.columbusareachamber.com.
Register to attend events at www.columbusareachamber.com/events Check the Web site calendar for all upcoming events. Nov. 2 — Economic Outlook Breakfast (register online) 7:30 a.m., Columbus Learning Center. Our annual look forward from the economists at IU Kelley School of Business.
Nov. 9 — TEN Session: Networking Roundtables (register online) 8 a.m., Visitors Center. Structured networking designed to expand your network and grow your business.
Nov. 8 — Ribbon Cutting 4:30 p.m., White River Clinic of Chiropractic
Nov. 16 — Live @ Yes Cinema ... (register online), 4 to 6 p.m., Yes Cinema.
Nov. 19 — School House Session, 7:30 a.m., Columbus Learning Center. Free, open forums featuring updates from BCSC.
November 2012 The Business Connection 9
watercooler continued from page 8 distribution, warehouse and management workers this fall and hopes to add up to 242 new jobs within six years. The company currently employs 185 in Greencastle.
to buy, renovate and equip two buildings in Angola. The new site is due to open in January. The maker of tubular products has more than 170 full-time employees in Fremont.
Whirlpool begins layoffs
Food company to reopen plant
EVANSVILLE — Whirlpool will soon begin laying off workers as it prepares to close its Evansville product development center. Whirlpool announced last month it was closing its Evansville center and moving the work to Benton Harbor and St. Joseph, Mich. About 220 people, including engineers and product developers, work at the plant.
CAMBRIDGE CITY — A food-processing company from Ohio announced plans to reopen an eastern Indiana plant where an organic food company had planned to hire 1,000 workers before shutting down last year. Sugar Creek Packing Co. said it would spend about $15 million to expand and refurbish the former Really Cool Foods plant near Cambridge City and expected to have it back in operation late next year. Sugar Creek bought the property for $13 million last month in a U.S. Bankruptcy Court. The company has five facilities in Ohio and Kansas and prepares a variety of raw and fully cooked products for domestic and international customers. It said a decision hasn’t been made on what it will produce at the Indiana plant, where it expects to potentially have 400 workers by 2016.
Auto parts supplier to add jobs ANGOLA — An auto parts supplier in northeastern Indiana plans to expand its operations and create as many as 95 new jobs. The Indiana Department of Economic Development says Autoform Tool & Manufacturing Inc. currently operates in Fremont and plans to expand to nearby Angola. It says the company is investing about $10 million
Oven plant to close FORT WAYNE — A Florida-based restaurant equipment maker plans to close a plant in Fort Wayne where ovens are made. Manitowoc Foodservice announced that it would close the plant in Fort Wayne by April 30 as part of consolidating operations in Cleveland, where it is expanding manufacturing. The number of employees affected was not disclosed. In December 2009, about 185 to 190 employees were expected to continue working at the local plant after the sale of the company’s Smallware Division. Manitowoc says it will invest in a satellite office in the Fort Wayne area for customer service and technical support teams of its Lincoln brand ovens.
Energy drink maker to expand WABASH — An energy drink maker is planning a $25 million expansion that’s expected to bring up to 200 new jobs to a northern Indiana city. Living Essentials, the producer of 5-hour ENERGY, announced it would build and equip a plant in Wabash with a total of 1 million square feet to be
added in phases. The company says that plant will become its third in the city about 40 miles southwest of Fort Wayne. The Farmington Hills, Mich.-based company’s new plant will add space for up to four new production lines and is expected to be operational by September 2013. Living Essentials started its Wabash operations in 2007 and now has about 370 full-time employees there who make more than 9 million bottles of 5-hour ENERGY per week.
Wind farm moves ahead ELWOOD — A Germany-based company that owns and operates wind farms across the U.S. is making progress building its first Indiana wind farm. E.ON Climate and Renewables North America energized the first circuit at its 200-megawatt Wildcat I Wind Farm, allowing the project’s first wind turbines to begin generating electricity. Developer Andy Melka said that 27 of the project’s 125 wind turbines were complete and the remainder should be in place by the end of the year.
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— Staff and Wire Reports
10 The Business Connection November 2012
company as vice president of business development. He holds a degree in electrical engineering. During his 27-year career, he founded and was CEO of Digalog Corp. and was director of product management and strategic planning at AVL. He holds several patents related to engine testing and development. Frances Jordan, deputy director of Columbus Human Rights Commission, has been accepted into the 23rd annual Richard G. Lugar Excellence in Public Service Series. The program provides leadership training, encourages and prepares women to seek new levels of involvement in government and politics, provides access to political and government leaders responsible for candidate recruitment and appointments and forms a statewide political network for women.
Robert McFarland has joined CyberMetrix power system development and testing system
Jerry Moore of Columbus recently was named vice president of sales at CCI Technologies in Columbus, formerly known as Central Communications. A graduate of Columbus High School and Indiana University, he has more than 26 years of direct sales and sales management experience and will handle telephone, security and alarm systems, video surveillance and home automation systems for CCI. Columbus family physician Dr. David Rau has been named to a second three-year term as an alternate trustee for the Indiana State Medical Association, representing the organization’s 4th District, which includes Bartholomew, Brown, Decatur,
Jackson and Jennings counties, as well as several other counties. The purpose of the ISMA is to promote sound health care policy in the public, private and governmental sectors and to support continuing medical education for Indiana doctors. Scott Ballard has been named market president for Columbus at Salin Bank. A resident of Columbus, he most recently was vice president and commercial loan officer with Indiana Bank & Trust Co. and also has held senior positions with Old National Bank, Citizens Bank of Central Indiana and Home Federal Savings Bank. He is a graduate of Indiana State University, with a degree in finance. Diana Schrader has been promoted to assistant vice president of retail loan servicing at JCB. She began her career with the bank as banking center leader of the Jackson Park locaDiana Schrader tion in 2008 and has served as retail loan servicing officer since 2009. She has 35 years of experience in performing and overseeing various lending and operations functions in the banking industry. Mark A. Dennis has been named to the board of directors of JCB and its parent company, Bancorp of Southern Indiana. He is founder and principal owner of Mark Dennis and Co., CPA. Mark A. Dennis He is a member of the American Institute of Certified Public Accountants, Indiana Certified Public Accountants, Seymour Rotary Club, Greater Seymour Chamber of Commerce Board of Directors, Seymour Industrial Corp. Board of Directors and is an appointed member of the Seymour Redevelopment Commission. He replaces R. Douglas Templeton, who resigned after 10 years on the boards. Jane Bowman, past president and executive director of Indiana Hearing Aid Alliance, was presented the 2012 James P. Lowell Advocacy Award. It is presented annually to an individual or
organization that has shown extraordinary commitment to advocating for the hearing impaired.
Jeremy Bednarski has joined the project management team at TLS.NET. He has an extensive background in managed customer infrastructure, focusing on Cisco network infrastructure, firewall management and
VMware. Chris Marks has been promoted to information security officer at JCB. He began his career with JCB in July 2003 as the assistant banking center leader at the Jackson Park Banking Chris Marks Center. He has also served as interim banking center leader at JCB’s Columbus Clover Center location, management trainee, training coordinator and in 2008 accepted the network administrator role, his most recent position. As information security officer, Marks assumes overall responsibility for JCB’s information security program. He also will continue his duties as network administrator. Marks serves on the board of Leadership Jackson County and participates in 21st Century Business as an instructor. He is a graduate of Indiana University with a bachelor’s degree in general studies. Tom Harmon has been chosen as the winner of the 2012/2013 Owen D. Hungerford Business Ethics Award given by Columbus Sunrise Rotary. Harmon is the CEO of Taylor Bros. Tom Harmon Construction. Harmon is active in the community, serving on the Heritage Fund and Columbus Regional Hospital boards of directors and with CAMEO, Volunteers in Medicine and the Turning Point dance marathon. His company started the Joy of Giving foundation, which gives back to many community organizations each year. — Staff Reports
The fiscal cliff
November 2012 The Business Connection 11
How steep are we talking? By Bill Waltz
The Bush tax cuts — set to expire on Jan. 1 — represent only the tip of the fiscal iceberg before Congress. Unfortunately, considerable political attention is being focused on just that top category — the highest individual tax rate bracket. What’s actually at stake is of much more fiscal significance and can be divided into two parts: “Taxmageddon,” a nearly $500 billion per year increase in taxes starting day one of the New Year; and federal spending cuts totaling more than $100 billion. To illustrate the scope of the potential dilemma: The so-called Buffett Rule to tax millionaires at a minimum effective rate of 30 percent would generate a relatively minuscule $5 billion annually. That number pales in comparison to the dollars involved with any one of the issues outlined. Examples: The payroll tax holiday costs $117 billion, the sequestration is $110 billion and another Alternative Minimum Tax patch is $92 billion, while the extenders account for $78 billion. Or compare that potential $5 billion in new revenue to the amount of tax that simply goes uncollected each year — estimated by the U.S. Treasury to be $450 billion. Many economists fear Taxmageddon alone would plunge the nation into another recession. Yet politicians continue to fight over philosophy, thus ignoring the big (dollar) picture that could have so much impact. The issues are many, the dollars are huge and the time is short. Little is likely to get done before the election. This leaves only a limited number of weeks in November and December for a lame duck Congress to resolve a collection of massive fiscal issues that have been stymied by the Washington gridlock for over two years. On the positive side, these are not new problems. They have been debated many times, and a lot has been hashed out previously. On the negative side, persistent disagreements remain. These are all politically sensitive matters, with middle grounds elusive and few details considered minor. It will entail much debate, necessarily involve negotiation and maybe even require some (dare I use the word?) compromise. Can some kind of grand bargain be struck, or will they drive us off the fiscal cliff? Although there are differences in viewpoint, philosophy and principle, there is a bipartisan recognition that these items must be addressed. And there is even some level of consensus on many of them. Sadly, the most probable result is that Washington policy leaders will take the approach that has been applied too many times already and choose to kick the can down the road by passing more temporary measures. But in this case that would still be far better than their other favorite practice — doing nothing. Perhaps by buying some time this go-around, policy makers can set the stage for making broad, comprehensive reforms next year. Eventually, they must take that step if they hope to avoid an even more treacherous and bigger fiscal cliff that looms somewhere on the horizon. Bill Waltz is vice president of taxation and public finance for the Indiana Chamber of Commerce.
12 The Business Connection November 2012
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september 1965 LAKECREST DR $149,000 NEW 3456 SF RES/GAR BEAZER HOMES OWNER/ CONTRACTOR 1995 LAKECREST DR $166,000 NEW 3600 SF RES/GAR BEAZER HOMES OWNER/ CONTRACTOR 2005 LAKECREST DR $148,000 NEW 2818 SF RES/GAR BEAZER HOMES OWNER/ CONTRACTOR 2030 LAKECREST DR $154,000 NEW 3456 SF RES/GAR BEAZER HOMES OWNER/ CONTRACTOR 2040 LAKECREST DR $132,000 NEW 2085 SF RES/GAR BEAZER HOMES OWNER/ CONTRACTOR
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November 2012 The Business Connection 13
Become a problem-solver Small business owners are some of the best troubleshooters I know. They can dive in and make a problem go away in record time, leaving the team to often wonder — how did she do that? The problem with troubleshooting is that it is short term and usually focused on eliminatMark McNulty ing unpleasant symptoms, which means that the underlying cause often remains in the shadows. To improve your operations, you and your team need to focus on evolving from troubleshooting to problemsolving. The more problem-solvers you have on your team, the better you will be able to grow sustainably and profitably, and be able to weather the inevitable storms that pop up in business. The problem with this is that most people don’t understand how to approach and solve problems. So how do you become a better problem-solver and teach your team to do the same? The good news is that problem-solving is simply another process that you can learn and teach to your team. The even better news is that when you are teaching your team this process, you are creating a whole group of leaders for your business, which is one of the main things that you need to take your operation to the next level. So let’s look at the four key steps of what I call the Four Step ProblemSolving Process.
Step 1 — What is Broken? This is by far the most important step; it is what makes or breaks the rest of the effort. The first step in solving a problem is a consensus within the problem-solving team of exactly what is broken. We often are presented with the symptoms of a problem, and the team needs to dig in and identify the root cause(s) of the symptoms so that the source of the problem can be fixed, not just making the symptoms go away. We take medicines to make our headaches and fever go away, yet that doesn’t cure us; we sometimes need an antibiotic to kill the infection causing the symptoms. To help find root cause you can employ a number of questioning techniques, like the Five Whys or simply asking yourselves what outcome(s) did you fail to achieve for your customer, your team or your business. Step 2 — What Broke It? This is the fun step, because this is where you get to identify all the reasons and excuses, all the other people or processes to blame, and even try to deny that any of this is actually a problem! After going through that, the team can then get serious and identify the process or processes that failed to deliver a satisfactory outcome. These can be leadership processes (communications, prioritization, resource availability), management processes (planning and/or tracking, feedback mechanisms, communications, scheduling), or operational processes and procedures that simply failed or were inadequate for the situation. If you really look hard
and are honest, you may find issues in all three areas. Step 3 — What Will Fix It? Now that we agree on what is broken, and how it broke, we can go about identifying what needs to be done to fix it. The most important part of this step is that every member of the team adopt a “What Can We Do” attitude and not a “That Can’t Be Done” attitude. Sometimes the fix is obvious to everyone; sometimes it may take some brainstorming and experimentation. Whenever possible, identify multiple options that can be evaluated and then throw different scenarios at them to ensure they really fix the problem, not just cover the symptom, and that they don’t have undesirable side effects. Besides fixing a broken procedure or process, sometimes fixes will include clarification or changes in ownership of tasks, accountability for intermediate and final results, and responsibility
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for taking new or improved actions. Be thorough and complete in this step. Step 4 — How Will We Know It Is Fixed? This is the next most important step after the problem identification. To ensure that the problem is truly fixed once and for all, you need to identify the measures or tracking systems that will let you know that the problem is really fixed and stays that way. Most small business owners are great troubleshooters, yet troubleshooting is not quite the same as problem-solving. Building your problem-solving skills and then teaching your team to do the same can take you soaring to new heights and leverages the untapped potential of the team in ways you might never have imagined. Mark McNulty is a business coach with ActionCoach Business Coaching. He can be reached at 372-7377 or mark@ coachmark.biz.
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