February, 2014

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Alexandria Tech & College
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Continental Hydraulics
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Data Sciences Int'l
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Douglas Metal Specialties
DRI-STEEM Corporation
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Federal Package Network
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Foldcraft Company
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Hamon Deltak, Inc.
Hasan Akhtar
Ironwood Electronics
Ken Lessley
La Machine Shop Inc
Le Sueur Incorporated
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Lowell Inc
Market Comm of MN
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Miller Manufacturing Co
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Ron Finelli
Saputo
Shippers Supply
Skyline Displays Inc
Spectralytics
Standard Iron & Wire
Surgical Technologies
Talon Innovations
TCR Engineered Prod
Thiele Technologies
Tolomatic Inc
Travel Tags
Uponor
Water Gremlin Co
Windings Inc
Zero Zone Refrigeration



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Article Index

Book Review- "Joy, Inc. – How We Built a Workplace People Love"
Article by: David Haynes

“I never did a day's work in my life. It was all fun." – Thomas A. Edison. I apologize. This is not really a book review. It's a plea. Put duct tape over the title if you must, but take Richard Sheridan's book seriously. There may be something in "Joy, Inc." to be critical of but I have no idea what it may be.


Internet Marketing Self Audit
Article by: Matt Timm

Business leaders and owners are inundated by people selling Internet marketing. However, most business leaders don’t truly understand what is being sold. This article is the first of a two-part series that will give you the tools to assess for yourself whether Internet marketing is a fit for your company, how your current implementation is working for you, and will help you answer intelligently the next time someone calls you promoting “Internet Marketing.”  Don’t assume that Internet Marketing will not work for your organization, use this assessment before drawing a conclusion.


HR Insights- Kim Blievernicht- Metro Mold
Article by: Kim Blievernicht

Kim Blievernicht has been the Vice President of Human Resources for 2 years at Metro Mold & Design. Headquartered in Rogers, MN and founded in 1973, Metro Mold & Design does rapid mold manufacturing, custom plastic injection molding, thermoset plastic molding, extrusion blow molding, precision CNC machining, and product assembly and finishing.


Five Indispensable Reports Used by Successful Businesses
Article by: Rob Steinberg

The most glaring difference between successful companies and flat-lined or distressed companies is that the successful companies understand in real-time why each part of their business is succeeding or not, and take rapid action to correct problems. 


MN Economic Outlook
Article by: Dr. Ernest Goss

For 14 straight months, Minnesota’s Business Conditions Index has remained above growth neutral. The index declined to 57.7 from December’s 58.9. Components of the index from the January survey were new orders at 59.9, production or sales at 61.6, delivery lead time at 58.1, inventories at 54.9, and employment at 53.7.


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Book Review- "Joy, Inc. – How We Built a Workplace People Love"

“I never did a day's work in my life. It was all fun." – Thomas A. Edison. I apologize. This is not really a book review. It's a plea. Put duct tape over the title if you must, but take Richard Sheridan's book seriously. There may be something in "Joy, Inc." to be critical of but I have no idea what it may be.

If you go buy this book (and you most certainly should) you'll probably do so without telling anyone and without leaving it in plain sight on your desk for everyone to see. Rich explains why in his introduction:

"Joy in business sounds ridiculous. Perhaps that's why, early on, I hedged on writing about building a culture of joy, why I was tempted to equivocate. Joy is a pie-in-the-sky, cymbals-clanging, music-playing, radical dream."

But he also knows why we picked up his little book and brought it home anyway:

"It's because you are hoping, somewhat beyond hope, to bring joy into your own workplace. Deep down you know that there is a better way to run a business, a team, a company, a department. You've always known it."

Sheridan's company, Menlo Innovations, is a custom software design and development firm in Ann Arbor, Michigan. The company name is a nod to Rich's childhood hero Thomas Edison and his Menlo Park laboratory. Sheridan's company is populated by Menlonians, a quixotic, talented, persistent, and relentlessly joyful group of presumed Earthlings. Their mission is "to end human suffering in the world as it relates to technology." I imagine there's a little tongue in their cheekiness, but all of us have our own stories of suffering the impertinence of bad software.

Menlo Innovations has won five Inc. magazine growth awards and was named one of 2013's twenty-five most audacious small companies. People come from all over the world just to see the Menlo culture firsthand. In 2012 alone, they hosted 241 separate tour groups, totaling 2,193 visitors. All of which is impressive but not really the point.

As I read Sheridan's stories and began to imagine I knew something about what Menloworld must be like to live in, I was struck by how much this narrative reminded me of my first exposure to the Toyota Production System and Lean Manufacturing: engaged people doing interesting experiments and improving their workplace. They even make good use of Post-it notes and visual management.

But I also realized that I was making the same mistake of getting caught up in Menlo's interesting implementations and not paying enough attention to the radical thinking that gave rise to their unique structure and culture.

The fact is, if you look at John Shook's (LEI's CEO) YouTube video on the Lean Transformation Model you'll see that Menlo's creation fits right into his model. What's different is how Rich and his Menlonians have answered the key questions of purpose (Shook's "True north"), the role of leadership, and the fundamental assumptions that underlie their particular transformation.

And if you revisit Mike Rother's "Toyota Kata" you'll see that Menlo Innovations also uses his "Kata Code" to drive improvement and avoid falling into an implementation rut.

What is so beguiling about the Menlo story is they see joy as an end in itself. The fact that it has turned out to be a competitive advantage is almost regarded as incidental. One of the most telling stories in 'Joy, Inc.' talks about the largest bonus checks ever given to Menlo employees. The founders were feeling gratified, but an awkward conversation with one of those employees gave Rich the uneasy feeling that he was missing something. He later learned that the woman he was talking to had been promoted to a senior level by her peers on the same day that the bonus was shared. The bonus was, in her words, a "momentary thrill." Being made a senior by the people she considered her extended family was "…the most meaningful raise I had ever been given. Joy."

But don't get the idea that this book is simply a collection of stories and philosophical asides. Sheridan has crafted a rigorous defense of his worldview and offers a structured way forward for those audacious enough to try.

Rich Sheridan is a wise and usually self-aware leader. We all have much to learn from him and his Menlonians. Treat yourself to a guilty pleasure, read "Joy, Inc.", visit Ann Arbor, help spread the joy. Then do something very important and very difficult, build your own culture of joy.

Richard Sheridan is the CEO, co-founder, and Chief Storyteller of Menlo Innovations, an Ann Arbor-based software development company. On their website, www.menloinnovations.com, you can find additional resources, including white papers, tours, workshops, reading lists, and examples of their work. Go there. Nose around. Heal thyself.

David Haynes- Owner of Lean4All LLC providing consulting services in influencing change: aligning strategy, IT, process improvement, and organizational communication. David may be reached at david@lean4all.com

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Internet Marketing Self Audit

Business leaders and owners are inundated by people selling Internet marketing. However, most business leaders don’t truly understand what is being sold. This article is the first of a two-part series that will give you the tools to assess for yourself whether Internet marketing is a fit for your company, how your current implementation is working for you, and will help you answer intelligently the next time someone calls you promoting “Internet Marketing.”  Don’t assume that Internet Marketing will not work for your organization, use this assessment before drawing a conclusion.

We’ll start at the foundation: Keywords

When people use a search engine like Google or Bing, they’re either doing research or have a problem they’re trying to solve.  Either way, the individual begins by typing a word or phrase into the search engine.  We call these words and phrases “keywords.”

There are fundamentally two types of keywords: branded and non-branded.  

  • Branded keywords are your company name or some derivative of your company name.  The people searching with branded terms are looking specifically for you…and we’re going to assume for the moment that they’ll find you. 
  • Non-branded keywords are general phrases geared toward your industry. These keywords are used by those people looking for companies in your category, but they don’t actually know who you are yet.  THESE are the people we’re interested in.  They’re either doing research on suppliers or have a specific problem they’re trying to solve, and you want your company to be on the consideration list.

Let’s start the exercise

Part One: Follow these steps to see how your website ranks

  1. Make a list of non-branded keywords you think people might search for to find your company online.  These keywords should describe what you sell but should not include a reference to your company name.  Example keywords:  medical device contract manufacturer, sheet metal fabricator or modular gas delivery systems.   Note: If your company only services local clients, also make a short list of what we call “geo-modifiers.”  This is a list of the communities you are interested in, such as Minneapolis, St. Paul, Brainerd, or even Minnesota. So your keyword would become “sheet metal fabricator in St. Paul.”
  2. Launch your browser. If you have a browser installed on your computer that you don’t normally use, choose that one.  Browsers have the ability to track your browsing history and that history can influence your search results, so a browser with a limited search history is best.

  3. Go to Google.com.  While there are other search engines, Google represents about 70% of search traffic, so we’ll use it for our purposes today.  If you’re not a fan of Google, that’s okay. But for the moment, let’s go to where the crowds are.
    Note: If you have a Gmail/Google + account, make sure you are logged out of your account.  Google may also serve you what’s called a “personalized result” that is influenced by your browsing history, and therefore you want to be logged out of Google to minimize personalized results.  We’re trying to replicate a search that is being performed for the first time.

  4. Now, type in the first keyword from the list that you generated above.  If you only target local clients, start with just the keyword and then add your geo-modifiers to the end of the phrase one at a time.
    When you perform a search, the top 1-3 results and those along the right column are generally paid search ads (companies pay to show their ads for these keywords).  Directly below the top paid ads are the “organic search results,” meaning that these results are not paid for.  While people are more likely to click the organic results, paid ads can be very effective.

  5. Look first at the organic results.  Is your company listed?  Are you in the local results or the national results?  The local results are the “A, B, C, D…” results with the little balloons (they show a list of local businesses relevant to the keyword at hand). The national results are those above and below the local.  Ideally you will be listed in both the national and local results, but Google will not serve local results for all search phrases.

    Are you on page 1?  Very few searchers go to page 2.  There are some developing reasons why a page 2 result has more value than it used to have, but generally for your most targeted search phrases, you want to be on page 1.
  6. Look at the paid ads at the top and along the right column.  Do you see your competition?  Are you running paid campaigns, and if so, do you see your ad? Take note of what your competition is doing, and think about how you can respond to that. Jot down some of your competitors who are running paid ads, and if you’re running paid ads, note if your ad is showing.

  7. Next to each keyword phrase in your list, write down your ranking.  Position 1 is at the top of page 1 and usually (not always) position 10 is at the bottom of page 1.  Also write down your local ranking, i.e. “A” or “D”.

  8. Make an assessment of how well your business is represented on the Internet.  How well are you ranking for your list of keywords?  What competitor(s) were dominant if it wasn’t you?

An important step is missing from this exercise, which is to research the phrases are actually being used to search for businesses like yours.  The process of researching the phrases that are being used to find companies in your category is more complicated than what can be described here and requires some special tools.  A good Internet Marketing Consultant will help you identify which keywords are being used in your category and how many searches are being performed each month.

The test we just ran is the first and most important test.  So many people I meet with say, “I’ve never had a new prospect from my website” when the reason is simply that their websites don’t show up!  It is the equivalent of saying, “I’ve never had a call from the yellow pages” when you never placed an ad in it!  Just putting up a website isn’t enough.  You need to take steps to ensure that your website shows up for your keyword phrases, whether paid or non-paid. 

Look for a continuation of this article next month where we will walk you through the process of completing your Internet Marketing self-assessment.  In part two we’ll assess online reputation, site design, mobile sites and the use of social media for B2B entities.

Matt is the Managing Partner at Magnetic North, a Digital Marketing Agency. Prior to founding Magnetic North, Matt spent his career in executive leadership positions in numerous technology and manufacturing companies. Matt can be reached at m.timm@magnorth.com

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HR Insights- Kim Blievernicht- Metro Mold

Kim Blievernicht has been the Vice President of Human Resources for 2 years at Metro Mold & Design. Headquartered in Rogers, MN and founded in 1973, Metro Mold & Design does rapid mold manufacturing, custom plastic injection molding, thermoset plastic molding, extrusion blow molding, precision CNC machining, and product assembly and finishing.

Metro Mold is well known for the high value we provide our customers with our design for manufacturability, project management, superb quality, and fulfillment and distribution. Our major customer markets include general manufacturing, surgical instruments and medical devices, fuel cell manufacturing, printer components, custom plastic containers, and custom plastic enclosures.

•Where did you receive your HR training/experience?
Early on in my career I learned that you need experience to get the job. I was in retail management right out of college and recognized that one of the reasons I was exceeding my business goals was the priority I placed on training and development of my staff. I also had a lot of fun developing curriculum for my team and sharing it across the company with other managers.  The most gratifying experience was seeing the flash report and knowing that my area of accountability was exceeding profit goals. I knew then I wanted to find a career that could allow me to utilize my business skills and teaching ability.

I joined Rasmussen Business College in St. Paul as part-time instructor teaching night school business classes (along with my full-time job).  With that extra experience and my success in management I was more attractive as a candidate as I was pursuing training and development positions. My part-time experience at Rasmussen lead to Kinko’s hiring me as the first Training Director for the Upper Midwest Region. Kinko’s was on a fast growth track and I convinced the leadership team that with my capabilities, I could help them reach their business goals.   Working at a company with aggressive growth objectives was chaotic, exciting and exhilarating. I helped them grow for the next 9 years.
 
•How and when were you introduced to HR and what fuels your passion for the profession?
A key element of the philosophy I embrace is that every interaction HR has with our employees is a leverage point to help build the business. Our high performing HR team at MMD focuses on at least one of the following beliefs in each interaction. 

•Build belief in the company
•Build belief in the people’s capabilities
•Build belief in the company’s products and services

We are the company to our employees. Our professional responses to inquiries, questions or concerns will build confidence in our business. It also is helping us build belief that we are an employer of choice.

•What are your company’s current HR-oriented activities?
Department by department workforce planning has been a key focus for the MMD leadership team this year.  This exercise helps ensure we have the trained team members we need to grow as a business.

We established clear objectives by department and linked them to the business strategy following this easy 5 step process:

  1. Department Summary – Strengths, Gaps & Key Actions
  2. Performance/Potential Matrix – 9 block
  3. Talent Summary Form  - Capability Relative to Industry Best Practice
  4. Succession Planning Chart – Internal Candidates & Years to Ready
  5. 2014 Summary – Key Moves and Actions

•What was one major lesson learned in 2013 that you feel others could benefit from experiencing?
I had a goal of becoming a more engaging speaker for some time and took action on it in 2013.   I discovered a series of Improv Classes taught through Stevie Ray’s at the Chanhassen Dinner Theater.  This is a class designed for non-performers and here are just a few of the skills I have gained that relate to public speaking.

  • I now leave my script at work
  • I am a better listener
  • I am able to keep an audience’s attention
  • I look directly at my audience now and adjust my message based upon their reactions
  • I’ve become a better thinker on my feet
  • I am able to use unplanned examples to illustrate points
  • I am more confident on stage

I still have butterflies right before I walk up on stage but I believe the skills I’ve learned in this series of classes has helped me become a more engaging speaker.  I highly recommend the instructor Jerome Mayne.

•What are the next steps planned for improving your company HR processes?
Improving our process and becoming more efficient and effective as a HR team is a priority for us.  Right now we are looking at all the non-value added activities we do.  We are challenging ourselves to eliminate, simplify or reduce the time spent on them.

The result of our efforts will enable MMD to grow without adding indirect staff to the HR team.

•How would you describe peer-to-peer education to a colleague in manufacturing?
Developing and keeping in contact with professionals I admire and want to learn from is a priority for me.  Once I make the connection, I look to be the first one to do a favor.  I actively look for ways that I can help or serve them.  When asked for something, I try to give a little more.  I deliver early and take initiative to help in ways I wasn’t even asked to do.  I have found that when you give freely to top professionals they know they can rely on you; it isn’t a one way relationship and will return the favor when you need help.  I get some of my best ideas, strategies and solutions from my professional friends.

Kim Blievernicht is the Vice President of Human Resources for 2 years at Metro Mold & Design. To learn more please contact Kim at kim.blievernicht@metromold.com

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Five Indispensable Reports Used by Successful Businesses

The most glaring difference between successful companies and flat-lined or distressed companies is that the successful companies understand in real-time why each part of their business is succeeding or not, and take rapid action to correct problems. 

While many finance departments, particularly in companies under $50MM in revenue, don’t know how to create or implement this reporting, it should take a consultant a matter of days to make this happen.  And, these reports only work if they are set up correctly using proven methods and if processes are established and implemented so they quickly result in data-driven change.  Bad management reports may be worse than no management reports.

Identifying the optimal reports, tailoring them to specific needs in your company, and setting up internal processes to create rapid response to weaknesses can be accomplished very quickly.

Described below are the five essential reports that drive successful business.

1.      13 Week Cash Flow

A forecast of future cash needs is often the single most important report for a business leader or owner to understand, yet most companies have no idea what their cash needs will be in 2 weeks, let alone 60-90 days.  Particularly if cash is tight or your company is growing, this report is absolutely critical. 

The 13 week cash flow projects your cash position each week, including consideration of your line of credit.

The 13 week cash forecast needs to be tailored for each business, and forecasted elements (such as receipt, labor, and material expenditures as well as line of credit availability) need to be established based on well thought out assumptions.  This report will definitely help avoid the surprise and stress-producing cash shortfall.

2.      Projected to Actual Report

The next key report compares projected revenue and expenses to actual revenue and expenses.  An accrual- based approach in which you recognize revenue when a customer has an obligation to pay you and recognize costs and expenses when you have an obligation to pay is the optimal approach since there isn’t the mismatch that occurs based on the timing of actual receipts and payments.  Accrual-based accounting gives you the cleanest picture of whether you are making money, and how and why you are making it.

The single most common error in this type of report is that the assumptions on which the projections are based are not clearly spelled out.  Accordingly, when you miss a projection, you don’t know exactly why because you forgot how or why that projection was made.

3.      Dashboard Report

A dashboard report is an at-a-glance snapshot of the economic reality of the numbers inside your business. It is the most powerful tool to allow you to take command of your business on a real-time basis and get feedback on actual results of your business and future changes, needs, and direction.

Effective dashboards will dig beneath the surface and quickly show why targets aren’t being met – i.e. out of whack margins, expenses, cash outflows that relate to sales of key products, in certain geographies, by this salesman, or to this customer.   While there is lot of dashboard software, the reality is creating an effective dashboard is an art form and the best approach will differ by business.

4.      Capacity Report and Production Plan

Regardless of whether you manufacture or sell a product or whether you provide a service, a capacity report and production/productivity plan is vital.  In a manufacturing company, you need to be able to project growth in the business so that equipment, labor, and space is available when you need it to meet delivery deadlines.  In a service-oriented business or retail shop, you need to understand how much of capacity (employee capacity or square footage) you are using to know if you are over or understaffed or whether you need a new store or larger facility. Without this report, it is so easy for a business, particularly a growing business, to be blind-sided instead of proactive in their approach to business.

5.      Sales Pipeline and Sales Plan

The fifth basic report that is indispensable to a successful business is the Sales Pipeline, which is based on the sales plan and strategy.  The pipeline usually consists of opportunities, targets, leads, and closed sales.  There are lots of different software packages for sales pipelines, and many are quite helpful.  However, the effectiveness of the pipeline is whether or not it highlights the information that is critical to you – the owner and/or CEO.  What is the conversion rate and time of each opportunity?  What are the calls per day or meetings per week of each salesperson?  Are your salesperson focused on the right accounts and likely to hit their sales goal? 

CONCLUSION

The secret to success of many businesses is that they have reports in place that tell them what areas of the business are harming overall performance, and then processes in place so that they understand their shortcomings and react to correct problems.  Even if you have a killer product or a great rainmaker the five key management reports will help any business become more successful.

Rob Steinberg is Managing Partner of CornerstoneAS, a Minnesota-based management and financial consulting firm. Email him at rsteinberg@cornerstone-as.com for more information on how to set up systems to understand your future cash needs and other key reports to enable your business to succeed.

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MN Economic Outlook

For 14 straight months, Minnesota’s Business Conditions Index has remained above growth neutral. The index declined to 57.7 from December’s 58.9. Components of the index from the January survey were new orders at 59.9, production or sales at 61.6, delivery lead time at 58.1, inventories at 54.9, and employment at 53.7.

“Healthy improvements among durable and nondurable goods producers are spilling over into the broader Minnesota economy. While construction activity is not back to pre-recession levels, it continues to advance,” said Goss.

Dr. Ernest Goss of Creighton University, used the same methodology as The National Association of Purchasing Management to compile this information. An index number greater than 50 percent indicates an expansionary economy, and an index under 50 percent forecast a sluggish economy, for the next three to six months.

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