Home Blog Page 5891

Tailored sales presentations, – Gauger

Tailor presentations to your customer
Question: I recently attended an extensive product training session. We have more than 400 items. How do I organize my information to make sure it makes sense for my customer?
Answer:
This question reminds me of a greeting card that I once saw which read something like this. On the cover it had a picture of a man talking to his dog. It read,
“Fido, you’re my best friend
“I truly love you Fido
“I especially love how loyal you are Fido, and how you bring me my slippers when I come home from work
“Oh, by the way, I bought you some new Dog Food, Fido”
The inside of the card said, “And here’s what the dog heard”
“Fido, Blah, Blah, Blah,
“Blah, Blah, Blah, Blah Fido
“Blah, Blah, Blah, Blah, Fido, Blah, Blah, Blah
“Blah, Blah, Blah, Blah, Dog Food, Fido”
The moral of the story? Find the dog food! Having a lot of product knowledge is important. Knowing how to use your product knowledge to appeal to each individual customer’s interests and values is the real key to effective selling.
Recently, I was in the market for a new phone system for a house that we are building. The salesperson told me more about transmitters and other technical aspects that I really didn’t care about. When I left the appointment, I was a bit confused and overwhelmed by the amount of information. I looked at my husband and said, “So, can we pick up line two when we are upstairs?” While the salesperson gave us a lot of information, he never addressed the specific applications that we had.
For years salespeople had been taught to develop fairly standard sales presentations, incorporating as many features and benefits as they felt were important. That is sometimes referred to as traditional feature/benefit selling. The message is more of a monologue, told from the seller’s point of view.
A more effective approach in today’s competitive sales markets is a customer-centered dialogue, one which the customer helps to direct and one which emphasizes the specific values for that customer only. Today’s sales presentations may appear less structured than the traditional approach. Yet, in order to conduct an effective interactive customer-focused presentation, preparation and structure are essential. Here are some suggestions for conducting customer-focused sales interactions.
Before the call
Understand value – Value only relates to the individual that you are working with at the time, and the specific solution(s) that you are offering to that person. People do not buy features and benefits. They buy specific solutions. First emphasize value for that customer and then use features of your product to emphasize how you accomplish those values. Don’t worry if you haven’t told your customer everything.
Set an objective – Prior to each sales call, know the specific outcome that you expect. What action should result from the meeting? That will help you to stay focused and know when to close.
Use a needs checklist – Before the call, ask yourself specific questions about how you are positioned with your key contact and any other persons who may influence the sale. Examples may be questions about how they feel about you, your product, the competition, and what’s in it for them. Based on this checklist, construct questions to help you fill in the gaps and present solutions during your sales meeting.
During the call
Position your agenda – This may simply be a statement like, “Here’s what we will accomplish today.” That will help to ensure that you and your customer are on the same path right from the start.
Uncover needs and then position solutions – This is the heart and soul of customer-focused selling. You may choose to uncover many needs at one time and then position your solutions all at once. Or you may choose to uncover needs and position solutions one at a time as you move through the interaction. Either is fine. The latter is less formal, allows for more customer interaction and gives you an opportunity to affirm positive solutions throughout the presentation, making it easier for the customer to commit.
Use questions to guide the presentation – Questions are like the tools of a carpenter. They are only valuable when used at the right time. Here are some examples:
– Open ended questions allow the customer to respond freely. Use these to conduct a needs analysis at the start of your presentation in order to gauge the presentation according to the customer’s needs and interests. They typically start with who, what, when, where, which and how.
– Tie-down questions are used to get a customer to move with you. It is said that a customer will not do business with you unless he’s said yes at least twice. Tie-downs are simply statements that end or begin with a question such as, “Isn’t it?” “Wouldn’t it?”
No more than two of those in a row or they start to sound like a technique.
– Give customers some options. This is particularly useful when you’re working with a customer who doesn’t know what he needs. If you give too many options, he may get confused. Limit the choices to two or three at any time.
– Value questions are used to emphasize the value for the customer. You ask the value in terms of a question. When the customer responds positively, you provide them with the specific features and benefits that allow you to accomplish this, such as: “If you were able to process your orders faster, what would you do that you can’t do now?”
– Involvement questions – These are used to gauge the progress of the sale. During the presentation, you would ask a customer about something he would have to decide after the sale. Involvement questions usually begin with, “If you decide to, or “When you decide to.” The way the customer responds will give you a lot of information about how close he is to a decision.
– Reverse questions are used to close the sale. When opportunities to use the reverse are recognized, they are highly effective. You reverse by simply asking a question with a question. For example, If the customer says, “Can you start on this project next week,” you say, “When next week do you want to start?” Rule of thumb is to reverse specific questions and answer general questions.
Adjust to different communication styles – Present information visually, auditorally or kinesthetically depending on the type of customer that you are working with.
Close on actions – Go back to your initial objective for the call and close on a specific action.
Don’t forget to say thank you – Send a handwritten note at the completion of a sales meeting. It will help to separate you from your competitors.
Marcia Gauger is president of Impact Sales Training in New Berlin.
June 1998 Small Business Times, Milwaukee

Post it – HR regulations

Are you posting the required employment notices?
Posting certain notices is required by many federal and state employment laws – a fact that most business owners know, but frequently overlook.
After all, how important are a few posters on the timeclock wall, given the challenge of complying with a seemingly infinite number of other employment regulations?
The answer is that it’s better to be safe than sorry. Although chances are slim that improper posting will cause problems, the possibility does exist, as a large employer in southeastern Wisconsin learned.
Before discussing that case, it should be noted that many employers apparently are not fully aware of their obligations related to the posting of notices. That observation comes from conducting human resources audits at small and medium-sized companies over the past year. Of the more than 25 companies audited, not a single one was in full compliance with its posting requirements. Most were seriously deficient.
The potential liability becomes clear in the case mentioned earlier. In that instance, the lesson pointed to the importance of where posters should be displayed.
The case mentioned above involved an employee who was terminated for excessive absenteeism. Eight months later, he filed a wrongful termination lawsuit, claiming the company violated his rights under the Wisconsin Family and Medical Leave Act (WFMLA).
The law gives employees 30 days to challenge their termination based on violating the WFMLA. However, the 30-day window begins only after the required WFMLA posters are displayed in a location where employees can reasonably expect to see them.
In this case, the WFMLA notice was posted near the Human Resources Department, in a lobby entrance area that employees do not use. Since employees enter the building elsewhere, the posting was not in a location where employees could expect to see it. Thus, the terminated employee was not held to the 30-day limit for filing his lawsuit.
After four years, the company agreed to a settlement that included substantial costs – a $266,000 payment to the former employee, legal fees, plus management time consumed working on the suit. The company also experienced unwanted publicity in a front-page story on the settlement.
It may be presumptuous to assume that this firm would have avoided a problem if it had placed the postings in the proper location. In that case, the employee might have been more likely to file a charge within the required 30 days. However, the company’s exposure was increased by the posting oversight.
A more proactive approach would be to ensure that employees understand their options under WFMLA and any other law that requires posted notices.
For instance, as soon as the employee’s attendance problem arose, the company could have researched whether he was entitled to either state or federal FMLA leave. If it was determined that FMLA was not applicable, the termination decision would have been confirmed and strengthened.
This case deals with only one of the 17 postings that an employer may be legally responsible for displaying.
Posting in the proper location will greatly reduce your liability. Posting the latest revision of each notice is a less serious violation, but one that is much more difficult to ensure.
Unfortunately, the agencies responsible for issuing notices do not automatically send employers new posters when changes are made.
In response, some employers turn to vendors who supply regular posting updates for a fee that can sometimes be rather high. Certain vendors offer an “all-in-one” poster, but there’s a danger in using it because not all of the items apply to all employers.
For example, the FMLA has different implications for companies with 1 to 24 employees, companies with 25 to 49 employees, and companies with 50 or more employees. A vendor with a “one-rule-fits-all” mentality could produce a poster with items that might not fit your company.
Such a posting could mislead your employees and prompt them to file inappropriate claims, resulting in a cost of time, money and damaged employee relations.
If your company has an HR professional on staff, that person is likely to have the contacts and resources needed to keep abreast of posting requirements and revisions to specific posters.
For those who don’t have an HR staff, the State of Wisconsin Department of Workforce Development offers an automated phone service (453-7705) that provides information on which state posters employers are required to display, as well as the latest revision date of each poster.
The DWD also offers a brochure (“Workplace Posters FAQ Frequently Asked Questions”) that provides this information, as well as federal posting information.
While this sounds like an ideal solution for employers who are uncertain about their posting obligations, caution is recommended in utilizing these services – at least in the near future.
A recent call to the automated system found the information to be significantly out of date. And the most recent DWD brochure was found to be equally outdated. When the system is updated – the DWD is working on it – employers should have an efficient and accurate method for ensuring compliance.
Jim Rittgers, SPHR, is the director of human resources for EPIC Staff Management. Comments and questions are welcomed via e-mail to jrittgers@epicstaff.com.
Checklist
Do you know if your company has taken the appropriate steps to avoid serious problems related to legally required postings? It has, if you can answer “yes” to the following questions.
4 Are you aware which of the 17 federal and state postings apply to your company?
4 Are all of the postings that apply to your company
displayed in your facility?
4 Are the required postings displayed where employees are certain to see them?
4 Are all of your legally required postings the most up-to-date revision?
4 Is someone in your organization responsible for
periodically ensuring that legally required postings have not been removed, damaged or obscured?
Small Business Times, Milwaukee, June 1998

PPO Pioneer Rich Blomquist

AHC’s Rich Blomquist puts emphasis on quality care
Richard Blomquist was in on the ground floor of the managed-care industry back in 1974, and he’s got a few stories to tell.
There was the time he was setting up his first dental managed-care organization in the Chicago area. Problem was, the few existing HMOs had close ties to the Chicago mob. Ultimately, Blomquist got around the problem without getting his legs broken, and went on to establish one of the nation’s first dental plans of its kind in the country – one the Wharton School of Business used as a case study.
Almost 25 years later, the 50-year-old Blomquist can afford to look back and laugh, and take stock of the growth of his 85-employee company, Associates For Health Care, Inc., in Brookfield, the largest Preferred Provider Organization (PPO) in the state.
Associates for Health Care (AHC) combines a network of physicians, hospitals and other providers who have agreed to provide affordable, quality health care in exchange for a larger volume of patients.
Essentially, Blomquist and AHC line up the patients with the health-care provider network, then AHC manages the costs by processing the claims and factoring in the discounts. The patients get affordable care and greater flexibility in choosing physicians, while the health-care providers gain a larger captive group of patients. AHC, meanwhile, ensures that patients receive the proper level of care through utilization management review.
And because everybody wins, AHC gets more business with each passing year.
In 1996, AHC handled $198 million worth of claims. Last year, that figure increased to $280 million. This year, AHC expects to represent $400 million in claims. Since 1989, the firm has grown at an annual 45% clip. That growth has been recognized by Ernst & Young, which nominated Blomquist as Wisconsin Entrepreneur of the Year for the second year in a row.
Not bad for someone who first came here in 1984 with only his knowledge of the health-care industry and a deep-seated conviction that PPOs represented the future of managed health-care organizations. While Blomquist commuted to Brookfield from the Chicago area, a utilization management nurse ran the fledgling operation from her home.
From those humble beginnings, today AHC operates out of a 20,000-square-foot facility on Corporate Drive in Brookfield, its third location since its inception.
AHC provides cost management services to more than 5,300 corporations which collectively provide health benefits to more than 370,000 people. Last year, more than 1.5 million health claims flowed through AHC. Corporate clients include Allen-Edmonds, Jockey International, Kimberly-Clark Corp., Snap-on Inc., Wisconsin Electric, Wisconsin Gas, Versa Technologies and a host of others. AHC also extends the PPO network to a number of large unions which participate through Taft-Hartley trusts.
Quality care saves money
Beyond the impressive numbers and the big names, AHC represents a commitment to quality health care that saves the marketplace money in the long run.
AHC’s utilization managers do not take the approach of: “How soon can we get Aunt Hattie out of the hospital,” Blomquist says. “Our orientation is, if you can provide the correct mix of care in the proper time frame, it’s going to result in tremendous economies.”
Blomquist says the message that goes out to members of the AHC provider network is one of doing nothing in the interest of economy that jeopardizes quality, because poor quality health care is very expensive.
“This is a significantly different message than what typically comes from the marketplace, but it is very effective,” Blomquist states.
AHC PPO members have some of the lowest hospital admission rates and some of the lowest average hospital stay rates in the state. Using the Professional Activities Study as a benchmark, AHC’s utilization management team has consistently achieved savings in excess of 25% over the study’s norms.
What typically happens in a managed care setting is a patient calls a nurse and indicates that he is scheduled to undergo a certain medical procedure. The nurse goes to a computer, which determines the average length of stay, or if it should be an outpatient procedure. AHC does not take this approach, instead applying a large case management approach, which is normally reserved for heart transplants and other substantial medical procedures. This means the AHC team applies medical need to every case instead of applying a rigid computer model.
“I’m not a big fan of trying to apply these very rigid programs to fit a patient’s needs,” Blomquist says. “There are so many variables for each individual that I just don’t think it works very well. By applying medical need criteria, it makes for a better outcome for the patient which saves everybody money in the long run.”
Why PPOs work
Today, fully 50% of the private sector’s health care is being provided under PPO-type plans. When people talk about managed care, they generally think about Health Maintenance Organizations (HMOs). But in fact, HMOs represent a minority of the managed-care industry, or about 27% of health care in the private sector. Blomquist says HMOs are actually in decline while PPO organizations continue to grow.
“I think that’s because the basic principles of PPOs are more in concert with the mindset of the American people,” he says. “Such things as freedom of choice. People don’t like to be told: ‘You have to go to this doctor or that doctor.’ Or, you have to get the blessing of this doctor in order to see a specialist. There is much more freedom to choose under a PPO.
“Someone could go into a PPO primary care doctor this morning, and, if they didn’t like that doctor, they could go to see another doctor within the PPO,” Blomquist says. “Time and time again in meetings with employees, we get that positive feedback on the freedom of choice. We tend to get 85-90% of the people using the PPO after a year to 18-month growth cycle.”
Blomquist got the idea for setting up the Chicago dental PPO after reading an article by Peter Drucker about a new health-care delivery system in Germany. That served as the basis for what he established in the Chicago area back in 1974-75.
“It was a new approach which was being used in Germany where employers were contracting with the doctors and hospitals to provide care to their employees,” Blomquist recalls.
The term PPO was not actually coined until 1986. By that time, Blomquist had picked up the 5,000-member Milwaukee Graphic Arts health and welfare fund, and the former W.A. Krueger Co. But many people’s employers were reluctant to sign up with AHC in the early days, telling Blomquist to come back when he had assembled “some real numbers” which would allow for greater economies of scale.
Providing incentives
Blomquist says AHC has always looked for a balanced relationship with the medical community. In order to achieve that benefit, if AHC asks for a discount from the physician in order to enhance the benefit plan to give the employee an incentive to use it, Blomquist says. It’s a matter of putting together a benefit plan that says you will pay 80% of health costs outside the PPO and 90% if members stay inside the plan, he explains.
That 10% increase comes, in part, through a fee reduction on the physician’s side, Blomquist says. If the health-care provider gives you a 10- to 20% fee reduction, AHC reinvests that into the better benefit that is offered to the employee.
“That gives you a win-win situation, and that incents the employee to use the plan,” Blomquist says. “There are some PPOs that do not provide the financial incentive. We have always insisted that there be some kind of financial incentive for the employee to use the plan, but we are the only PPO in the state which has done that.
“I have turned away literally hundreds of thousands of dollars of business that didn’t meet that criteria,” Blomquist shrugs. “We have terminated the largest national PPOs because they didn’t meet that criteria, and others.”
Blomquist insists on having the PPO’s logo on the patient ID card, and on the remittance that comes back with the benefit payment. On the administrative side, AHC also delineates discounts from ineligible charges and co-pays and deductibles, as opposed to giving the doctor a single number and instructing him to write off that amount.
“You need to split it up so there is clear communication so that it works administratively so everyone understands how the program is fitting together,” Blomquist says. “Some people simply don’t do that.”
Other PPOs haven’t done that because the medical community hasn’t forced them to do it, Blomquist says. The worst transgression, he says, is a blind or silent PPO, where an insurance carrier or payor is able to contractually tie into a discount, yet the doctor or hospital is not notified that this particular patient is eligible for a discount.
“The doctor provides the services, sends the bill to the insurance company, then he gets a notice back that he owes $1,000 in discounts.”
That happens, to a large extent, because the medical community has allowed it to go on, Blomquist says.
June 1998 Small Business Times, Milwaukee

Keep the heat on for summer sales efforts

Don’t let the “It’s summer” excuse slow down your sales efforts

Eddie” came up to me at a recent sales conference. “Thanks for the great ideas,” he said. “Too bad it’s almost summer.” I knew what he meant, but asked anyway, “What do you mean?” His answer: “That’s our slow season. Everyone’s on vacation and it won’t help to start any new strategies until fall.”
Here’s my question: do procrastinating customers put us off in the summer, or do we do it to ourselves?
There are a lot of myths and misconceptions about selling. Everybody’s in meetings on Mondays, everybody leaves early on Fridays and (unless you’re retailing snowthrowers) summer slows down because of vacations. The truth is, summer is a great time to do business. If it weren’t, pent-up sales would make September 400% greater than any other month.
If you stop “selling,” or too readily accept “waiting until Labor Day” as an excuse, prospects cool off, budgets are diverted and competitors cash in.
Before you bite into that trap this summer, here’s some food for thought. Expect resistance from some customers. Some will have valid reasons. Plan accordingly, and be prepared with solutions that make sense for them now. A problem they have today could be three months greater if put off.
Start by probing a little deeper. Ask questions like “Is summertime a problem?” “Why is fall a better time?” or “Couldn’t you have a competitive advantage if we take action now?” The answers will often include staff vacations and suspended company meetings. Decisions are still being made, but yours may not be pre-positioned as a priority. Identify the urgency of your product or service by asking, “Aside from that, how do you feel about the plan?” Their put-off may be just a sign that there are unanswered questions or concerns.
Another course of action is to increase, rather than decrease, your activity. Sure, some customers have valid reasons to wait, but they don’t represent everyone. Somebody’s always in the market to buy.
It’s easy to get caught up in the myths and misconceptions of doing business. The pros are the ones who look at obstacles as challenges to be beaten, then take the action, and the risks, to overcome them.
Summer is a great time of year. My personal favorite. It’s also a great time to sell, no matter what anybody tells you.
Joe Guertin is president of Joseph Guertin & Associates, an Oak Creek-based speaking, training and coaching firm. Your comments are invited at 762-2450, or at jguertin@tcccom.net
Ten Tips
… for hot sales in the
summertime
1 Plan ahead
Set lofty summertime goals for yourself
2 Give prospects a reason to buy
Be creative and use special packages
3 Expect summer resistance
Be prepared to probe their reasoning
4 Use positive positioning
Help buyers see competitive advantages
of avoiding delays
5 Expand your customer base
New business will fill in the gaps
6 Take advantage of summertime activities
Treat clients to outdoor events,
or bring cool refreshments to hot meetings
7 Control your own mind-set
Don’t accept the first few setbacks
as an affirmation
8 Expand your summer business wardrobe People who dress for the weather
spend more time in it
9 Avoid quitters and pessimists
Negative talk rubs off easily
10 Always ask for another reason
The fact that it’s summer should never
be enough
June 1998 Small Business Times, Milwaukee

The IT roadmap

Develop your strategic IT plan
The role of technology is expanding and, as the pace quickens, technology’s impact on all aspects of business is increasing significantly.
Now more than ever, business executives of emerging, middle-market and Fortune 1000 companies need to use information technology (IT) to increase their companies’ productivity, effectiveness and competitive advantage.
The key to success is developing a proactive strategy for incorporating IT into your organization, keeping in mind that technology should help solve business problems – not exist for its own sake.
Begin by examining the forces affecting your business and by articulating
a clear vision for your
company’s future.
Here’s a three-step framework for developing a strategic IT plan:
Vision – define your business needs and IT goals.
Strategy – allocate resources to maximize your company’s technology investment and improve performance.
Implementation Approach – identify IT initiatives to maximize the progress of your plan and vision.
You should focus on how using information technology can benefit all aspects of your business. The following steps are guidelines to help you begin the planning process.
Start with the vision
You must begin by examining the forces affecting your business and by articulating a clear vision for your company’s future. That vision should align your business needs of sales and marketing, operations and the marketplace, with your IT goals.
Technology’s traditional role of data collector, information gatherer and communicator has shifted to decision-maker, knowledge manager and collaborator. Keeping that in mind, you must define the role that IT is going to play in your business. In doing so, it is important to understand the organizational, social and technological trends that are shaping this evolution.
Eight trend shifts shaping IT, according to The Gartner Group, a research firm that specializes in information technology, are:
1. Data, to decision support
2. Communication, to collaboration
3. Information, to knowledge
management
4. Network computing, to
ubiquitous computing
5. Graphical, to cognitive
user interfaces
6. Situated, to mobile
7. Physical, to virtual
8. Business, to consumer
Utilizing information technology as a strategic component of your business is the key to success and, in order to do so, it is important for you to understand where you currently are in this shift and where you need to go to remain competitive.
The strategy
While the vision identifies your business goals, the strategy portion of your plan outlines how you will move toward this vision. Historically, cost has driven IT strategy development. However, businesses’ reliance on IT to improve productivity, effectiveness and competitive advantage has shifted the focus to how IT can increase business value.
The Gartner Group expects businesses in the United States to increase their IT spending by 7.5% in 1998 and 8.5% in 1999. The group bases its prediction on three factors, outlined as follows.
Factors influencing IT spending
Many companies are only now beginning Year 2000 compliance projects. Spending patterns are thus shifting from business as usual to a concentration on strategic IT plans and Year 2000 compliance – and nothing else.
The rise of the Internet and the availability of mobile communication technologies make it possible for enterprises to compete globally.
Technology convergence, coupled with organizational shifts in IT spending to business units, masks this increase.
This strategy step establishes the direction your business needs to take to get the best return on its IT investment
Using information technology as a strategic component of your business is the key to success. You need to understand where you are and where you’re going.
and improve performance. Each strategy within your plan, whether it be outsourcing, network consolidation or standards adoption must be developed around available resources so that you can determine a realistic approach.
Implementation approach
The implementation portion of your plan sets the parameters for accomplishing your IT goals – what needs to be done, how much it will cost and how long it will take. Those parameters should take into consideration your corresponding projects, technology investments and organizational improvements. To avoid a disconnected plan, which only limits progress, you should keep your initiatives to a minimum.
Reaping the value of information technology begins with a clear and focused strategic IT plan, composed of vision, strategy, and implementation components which management will champion and which your entire enterprise will follow. Your strategic IT plan is only what you make of it. Unless it’s implemented and referenced, it will be another document with limited value.
Bob Landgren is a partner and the Milwaukee branch manager for Whittman-Hart, Inc.. He can be reached via e-mail at bob.landgren@whittman-hart.com.
June 1998 Small Business Times, Milwaukee

Finding quality employees is tough

It’s tough to find quality employees in today’s market

Question:
Like many companies, we’re having a hard time hiring qualified workers. We’re also seeing a trend in which employees we hire don’t stay with us very long. This means that we’re continually filling the same positions, which makes it pretty hard to build any kind of consistency or teamwork. Do you have any suggestions about what we can do?

Answer:
Your situation is an increasingly common one. Unemployment remains low, particularly in southeastern Wisconsin. Job seekers, especially those in “hot” fields such as computing, often have their choice of positions.
From the point of view of the employer, this often means that they have to “sweeten the pot” in order to attract the candidates they desire, sometimes at a higher compensation level than they’re comfortable paying.
A recent survey of employers in Nation’s Business magazine revealed that 80% indicated that they were having difficulties finding qualified employees over the past year. So, you are not alone.

Interestingly, the same poll indicated that attitude and work behavior were the areas in which job applicants were deemed to be weakest. That suggests that people are being hired primarily on the basis of their technical or subject matter expertise.
Yet, the ability to work effectively with other people is at least as important as job know-how. That highlights the importance of the training/development function of the organization which I have discussed in some of my recent columns.
As a starting point, I would suggest that you examine your present employee-selection practices. Do you have a clear idea of the position requirements? With frequent changes in work technology and processes, job requirements sometimes outpace job descriptions. As a result, as we solicit job applications we may be out of touch with what the demands of the position really are. That can lead employees to become disenchanted when they come on board and find out that the job is more (or less) than they bargained for.
What are the competencies which are critical to success on the job?

That focuses on the human dimension of the employment equation. The basic thrust here is to make sure that the attributes which you are targeting are the ones that really matter.
As the survey we discussed above makes clear, job know-how matters; most employers say it is the most important thing they look for. Yet other attributes which must be considered have to do with the context in which the person will operate. For instance, a strong team environment demands that interpersonal and communication skills be assessed during the screening process. So, be careful to avoid being one-dimensional in your approach.
Is everyone involved in the hiring process (e.g., HR, department manager, interviewers) “reading from the same book”? Sometimes employee selection is “owned” by more than one individual or department. Human resources might develop the position advertising and do the initial screening, including one or more interviews. Subsequently, the manager who will supervise the individual will get involved and conduct a Pre-Employment Assessment before hiring a candidate. Some organizations make use of team interviews in which employees (peers of the person ultimately chosen) carry out the entire selection process. Some organizations make use of external consultants who interview or test prospective employees at some point in the application process.

Regardless of what approach is used, it is important that agreed-upon criteria guide the process so that “apples” can be compared with “apples.”
Does performance during the selection process correspond with performance on the job? If you are making use of sound selection strategies (e.g., reliable, valid interview approaches, simulations/work samples, etc.), then the way an individual “looks” as a candidate is likely to be the way they “look” as an employee.
Of course, when good candidates are few and far between, the inclination may be to lower standards just to get a “warm body” in the door. However, employing “pulse rate” criteria brings along with it great potential to be disappointed. It’s been my experience that very few candidates who come across as corpses develop into superstars once they have been hired.

Set a standard below which you will not drop. Painful though it may be, my sense is you’re better off in the long run sticking to your guns, as opposed to bringing on board candidates who are “projects,” at best.
You may want to consider some non-traditional approaches, as well.
How are you obtaining applicants? Are you making use of the Internet to solicit applications? Is your organization a participant at local job fairs? In light of W-2, are you looking to former welfare recipients as a pool of potential employees?
Are you offering your incumbent employees a bonus or reward for attracting new employees to the organization? Are you paying employees an incentive once they’re on board for performance and/or regular attendance? How does your compensation package compare with the competition?
Although these suggestions may be anathema from your vantage point, in light of the present employment climate, you may do well to explore them.

HR Connection is provided by Daniel Schroeder, Ph.D., of Organization Development Consultants in Brookfield. Small Business Times readers who would like an HR issue addressed in this column can contact Schroeder at 827-1901, fax is 827-8383, or via e-mail at odc@execpc.com.
June 1998 Small Business Times, Milwaukee

Vendor or business resource – Jerry Stapleton

In the eyes of your customer, which one are you?
I frequently make the point that customers will perceive your value based much more on how you sell than merely on what you sell.
At the lowest level, they see you as a vendor. Moving up just a little, you become in their eyes a problem-solver. I see scant difference between the two.
As a salesperson, you take a quantum leap when you become a business resource to your customers. As a business resource, life is good and your margins are high. But you can’t just will yourself to that level. Becoming a business resource requires business acumen, organizational savvy and discipline.
Take this quick test to see if you’re there – or if you have what it takes to get there. Which one are you?
You’re a vendor/problem-solver …
If your motto is “look for the decision-maker” – overlooking the complexity of decision-making processes in customer organizations, where crucial purchasing decisions turn on the ebb and flow of shifting influence and evolving business conditions and goals.
You’re a business resource …
If you recognize that making decisions in the real world is complex and subtle. You understand that title and influence don’t always go together, and make it your business to figure out who in the customer firm may have high influence despite having a low title – and vice versa. One question you never ask: “Who makes the decision.”
You’re a vendor/problem-solver …
If you dismiss the importance of selling to senior executives. “I’ll alienate my contact,” you may say. Or, “The decision just goes to senior management for a rubber stamp.”
You’re a business resource …
If you’re executive credible. It’s your standard operating procedure to approach senior management, usually early in the sales cycle. You prepare thoroughly and understand what it takes to be viewed by the customer executive as a Business Resource.
You’re a vendor/problem-solver …
If your principal sales tool is the proposal, ignoring that most are about as inspirational as a consumer brochure on aluminum siding. If you lose a sale, you have a ready excuse: “What can I say, boss? They just didn’t like our proposal.”
You’re a business resource …
If your principal sales tool is the business presentation. You know that nothing has a higher impact in the sales cycle, and that an effective stand-up presentation is much more sophisticated than sitting across the table discussing your product, solution or company. And you know that the proposal is nothing more than a confirmation tool.
You’re a vendor/problem-solver …
If you rely on your gut feelings and hunches to qualify opportunities. You spend way too much time on sales opportunities that you end up losing (“Nothing ventured, nothing gained” is your philosophy) rather than undertaking a cold, hard evaluation up front about the likelihood of winning them.
You’re a business resource …
If you force every sales opportunity to pass a three-part test: 1) Should we pursue? 2) Can we win? 3) Will it be good business? You have objective criteria for your sales campaigns and your competitive situation that you can use to answer those questions. You apply those criteria throughout the sales campaign, not just at the beginning.
You’re a vendor/problem-solver …
If your objective is sales activity. You rack up stacks of proposals, fire off quotes, wear your index finger out making phone calls and figure it will all help you make the customer’s short list or even close the sale. Nobody can say you don’t work hard.
You’re a business resource …
If your goal isn’t mere activity, but to own the customer – to reach a relationship in which customers will turn to you first whenever they have a need that you can be reasonably expected to fill. You strive to be seen as having much broader value than a vendor, and you know you’ve reached that level when a customer gives you the right of first refusal.
You’re a vendor/problem-solver …
If you are content with fulfilling known opportunities with nominal solutions. “Is there a budget?” you ask, then try to show the customer that your solution is the best one within that constraint. You learn about your own product line so you can proffer it as the answer to your customer’s problems.
You’re a business resource …
If you create opportunities. You understand that if you know the customer’s business well enough, you may perceive a need before the customer does. You know that when a company wants to do something, it won’t be limited by existing budgets but will find the budget dollars. Instead of product knowledge, you focus on a deep knowledge of your customer’s business, and on gaining access to the executive levels where budgets are created.
You’re a vendor/problem-solver …
If you like nothing more than a good competitive fight. You’ll outsell competitors on whatever grounds they choose: price, product specifications, quality – who cares? Or if what you’re selling is little more than a commodity, then you try to win by force of your personality.
You’re a business resource …
If you know the real contest isn’t about price, specifications or quality, but strategy. You know when to go head-to-head against the competition and when to divide and conquer, or even when and how to change the ground rules.
You’re a vendor/problem-solver …
If you are a talker. Schmoozing customers, you listen for signs of a need that will give you an opportunity to pitch your product. Or, at best, your conversations with customers are the traditional problem/solution dialogue.
You’re a business resource …
If you’re a listener – and more. You listen with a strategic sense of curiosity and discipline, applying business acumen and analyzing what you hear. Most important, you listen for the need behind the need.
You’re a vendor/problem-solver …
If you sell tangible solutions, with a value that can be measured in return on investment, superior technology, price for performance, speed or savings to the customer.
You’re a business resource …
If you sell intangible value, and can communicate to the customer the value of having a business relationship with your company.
You’re a vendor/problem-solver …
If you see the customer as your friend and focus on building rapport.
You’re a business resource …
If you see the customer as a business peer, and live out the confidence you have that you have the ability to bring business value to your customer.
You’re a vendor/problem-solver …
If you understand the customer’s business – but only up to the point that it applies to what you’re selling. Your efforts to understand the customer’s problems are simply a search for opportunities to sell your product.
You’re a business resource …
If you focus on the customer’s business – in depth. You temporarily forget what you’re attempting to sell as you learn the customer’s business, its context and its environment. You’ve developed that unique ability to align the value your company brings with the business direction of the customer company.
Jerry Stapleton is president of The IBS Group, a large-account sales consulting firm based in Brookfield.
June 1998 Small Business Times, Milwaukee

What others say about Milwaukee

“People [in Boston] always express surprise when I tell them all of the big companies that are located here, like Northwestern Mutual Life and Johnson Controls.”
Kate Krill, a Milwaukee native who just moved back from Boston
“Milwaukee is not people’s first choice. When you are trying to get people to move from a place like the Silicon Valley to Milwaukee, it can be an obstacle. But once they bring their families, they like the values and the lifestyle.”
Ron Roth, Manhattan-based executive recruiter
“It appears that people on either coast have difficulty pinpointing locations in the Midwest. I’ve had people say to me, ‘Oh, Milwaukee … Isn’t that on Lake Superior, or across the river from Minneapolis?’ We are terra incognita to these people.”
Jude Werra, Brookfield executive placement specialist
“The major obstacle with Milwaukee is climate.”
Ron Roth
“My impression coming here is that it was going to be a small town, that everyone would be from here and that it would not be a very cosmopolitan city in the sense that it would have no great restaurants, nightlife or people coming here from all over the place. At the same time, I also expected it to be a very friendly city, and a place that was livable and affordable. To some extent, these are still my impressions, although the restaurants are actually better than I expected.”
Stacey Watson, a 31-year-old market analyst with Harley-Davidson who moved here last September from the East Coast
“I showed one of my co-workers this picture of the downtown lakefront, and she said she had no idea it was that beautiful. They (former Boston co-workers) all want to come and visit me because I have talked about it so much.”
Kate Krill
“I like to call Milwaukee the land of milk and honey.”
Ron Roth
“My boyfriend, who is from Pittsburgh and lives in Chicago, has a very negative impression of Milwaukee. But, he has never been here.”
Stacey Watson
“If Governor Thompson ever gets tired of it, I’ll take up the mantle as the state’s number one cheerleader. It’s a great place to live, and it’s not superficial. The people here are real.”
Dick Tilmar, a Milwaukee native and CEO of the T.E. Brennan Co. who lived in Southern California for eight years before moving back
“There is an inferiority complex built into life here that is detestable. There is a negativity that creeps in. The message seems to be one of ‘You ought to come back and give us a try.’ That’s called leading with your chin.”
Owen May, former Channel 4 television reporter and general manager of Metro Video Services in Wauwatosa who moved to Milwaukee in 1988 from Boston.

Healthcare- controlling doctors’ behavior

Controlling doctor behavior is path to controlling costs
Milwaukee dermatologist Kathleen Stokes listens with envy when her father-in-law reminisces about practicing medicine in “the good old days” before managed care.
He made house calls and treated patients “with no one looking over his shoulder, judging his efficiency, or checking his treatment outcomes,” she recalls.
Traditional indemnity insurance of his day paid practically any bill submitted, allowing him to try whatever he thought best to cure his patients’ maladies. Even patients with no money and no insurance were no problem. Before managed care, doctors could “cost-shift” by charging their insured patients rates designed to cover their overall costs. Consequently, everybody could trust his or her doctor to provide the best medical treatment available.
Managed care changed the rules and fundamentally changed the way doctors practice. While most doctors say they still strive to do whatever is in the best interest of their patients, managed-care organizations have finally succeeded in controlling costs primarily by influencing doctors’ behaviors.
Managed care has tightened the purse strings through financial incentives, administrative strategies such as utilization reviews, referral requirements, and profiling systems linked to administrative sanctions.
Medical directors for managed health-care organizations say they are forcing doctors to consider economics when making medical decisions rather than giving them a blank check.
Doctors say the economic pressures do impact the quality of health care provided.
Booming health-care inflation heralded the new era of managed health care which began in Wisconsin with the introduction of HMOs in 1972.
Since then HMOs and their off-shoots (an alphabet-soup of health-care options including HMOs, IPA-HMOs, open HMOs, PPOs, and POSs) continue evolving as they strive to answer the market’s demands for cost-effectiveness and quality service.
The array of managed care options grew from the original staff-based models that pioneered the state’s managed-health frontiers. Staff-based HMOs use salaried doctors at specified medical centers. They bring several systems under one roof: medical, financial, and administrative. With their closely-knit operations, these HMOs have proved most effective in controlling costs and maintaining low monthly payments.
However, for consumers who were used to seeing any doctor they like whenever they wanted, the controls seemed too restricting. To keep their employees happy, employers asked for more options. What they got were new HMO structures aimed at bringing in more health care professionals, such as IPA-HMOs and group and network HMOs.
Preferred-provider organizations (PPOs) sprang up in the mid-1980s as an alternative providing more choice while controlling costs. Employers found that groups of hospitals and doctors would be willing to cut prices in return for assured volume of patients. For employers, they provide a cost-saving compromise for workers who resist joining HMOs.
Soon hybrids of those forms appeared, among them open HMOs or point-of-service plans. They allow patients to go outside the plan’s HMO providers when they choose to share in the cost through co-payments and deductibles and take responsibility for filing claims.
Today managed care accounts for 85% of employer-based insurance enrollment. Traditional indemnity plans are down to 15% of active employees.
Evidence shows managed care has succeeded in controlling costs. For the fourth year in a row, the 1997 costs of providing health benefits to active and retired employees by US employers with 10 or more employees increased more slowly than the medical component of the Consumers’ Price Index (2.8 in 1997).
While some predict premiums will rise this year and next, managed care controls are expected to keep tight reins on increases. Thanks to managed care, more companies can afford to provide health benefits to employees.
Employers, who foot much of the bill, are glad someone has lassoed runaway health care costs. But lower medical inflation doesn’t necessarily mean better value. As one doctor put it, “you wouldn’t buy a Yugo and think you’re getting a Mercedes-Benz.”
Consequently, concerns are being voiced about the quality of medicine available under managed care. State and national initiatives to regulate managed-care organizations are being debated.
June 1998 Small Business Times, Milwaukee

Factoring/Finance

There’s a new twist on accounts receivable financing
When businesses think of accounts receivable factoring, they can conjure up unpleasant thoughts of insensitive third parties beating on their hard-won customers for payment.
But most small business people know very little about factoring because it has historically been limited to certain industries such as textiles and apparel, and to larger companies. Recent technological and software advances have spawned factoring programs for smaller businesses that are strapped for cash.
Factoring has been used since colonial times in the Americas and even before that in Europe. Factoring involves the sale of accounts receivables to a factoring company. Prior to those sales, the factor will have approved the credit and set credit limits for the customers.
Thus, there are three parties in any factoring arrangement: (1) the seller who sells both the merchandise to (2) the customer and the receivable to (3) the factor.
Factoring arrangements can be set up for notification or non-notification, which governs whether the customer is notified that the account has been sold to the factor.
Also, factoring arrangements can be recourse or non-recourse. When the factor has recourse, the factor can look to the seller of the accounts receivable if the customer does not pay in 120 to 180 days. The non-recourse factoring arrangement has been the arrangement with which most business people are familiar.
The normal steps in the factoring of an account are:

  • Approval of the credit by the factor
  • Submission of customer
    invoices to the factor
  • Entry of the account on the factor’s books and collection system
  • Payment of between 70% and 85% of the invoice amount to the seller
  • Collection of the account by the factor
  • Payment of the balance due to the seller, less the factor’s fee.
    Of course, the steps would be different if the customer didn’t pay or if there were some problem with the merchandise from the seller.
    In the above process, the factor is performing four functions:
  • Credit review and approval
  • Bookkeeping
  • Financing
  • Collection
    Small business factoring arrangements typically leave out some of those functions. While traditional factoring includes very much of a focus on credit and collection, small business factoring is much more focused on providing financing. Credit review and approval generally remains with the seller.
    Since the factor has the account on its computer system, collection is often merely a series of letters to past-due accounts. Generally those arrangements are non-notification – the customers are not notified that the accounts are being handled by a factor. Whenever the factor does not perform the credit review and approval function, the factor retains full recourse to the seller for accounts that are not paid within 90 to 120 days.
    Factoring can be a good tool for the rapidly growing small or startup business. It provides immediate cash flow at the time the sale is made. That cash flow can be used for traditional working capital uses such as purchasing inventory, paying subcontractors and employees, and covering operating expenses.
    Because factoring does not create a corresponding liability on the seller’s balance sheet, it can enhance the seller’s ability to obtain credit from vendors. Even if the collection systems provided by the factor are minimal, they are often better than the seller’s internal systems and decrease the cost of the seller’s collection efforts. Since the factor makes its credit judgments based on the credit quality of both the seller and the seller’s customers, factoring often provides financing for sellers which can’t qualify for more traditional credit facilities.
    One of the more innovative programs geared to smaller businesses is the Business Manager program developed by Private Business of Brentwood, Tenn. The program is designed for “community” banks, which means the smaller, independent banks. Over 1,700 banks nationwide, including several in southeastern Wisconsin, have installed the program.
    The program includes software that tracks customer receivables. The software also generates collection letters and receivables management reports, including aging reports. Sellers can either fax or electronically transmit their invoices to the bank and have the money credited to their account within 24 hours.
    The bank has full recourse and deducts the advance on any accounts that go 90 days beyond terms. Sellers can choose either to notify or not to notify their customers that the receivables have been factored. Sellers have on-line access to the status of their factoring accounts at the bank.
    Milwaukee Western Bank has installed the program recently and already has 10 customers using it and averaging over $220,000 each in outstanding receivables under the program. Customers range from a heating contractor to a hardware store that has many industrial customers who require invoicing for the materials they purchase.
    Dean Niemuth, vice president at Milwaukee Western, says that it gives the bank an opportunity to provide a credit facility to companies that otherwise might not qualify for traditional bank loans. Plus, he says that the program is flexible enough that it can be tailored to meet individual seller’s needs in terms of collection efforts and transparency to customers.
    The cost to the seller ranges from 1% to 4% with the normal being in the 2% to 3% range, notes Niemuth.
    Port Washington State Bank has been using the Business Manager program for more than two years and has 20 customers with average outstandings of $165,000. Its customer list includes manufacturers, building trades contractors, and an architect.
    Keith Wetherell, vice president of Branch Lending, says that it has been a great program, especially for the bank’s rapid-growth customers. He says that the flexibility of the program allows the customers to sign up without any long-term commitment.
    Jeff Larson, vice president at Grafton State Bank has been using the program for almost two years. He is using it for six customers with average outstandings of $100,000. He likes the program because it allows him to monitor the seller’s use of the credit facility as the seller issues invoices, rather than waiting for a borrowing base certificate that the borrower doesn’t usually send until the 15th or later in the following month.
    Since late 1997, the FIPCO subsidiary of the Wisconsin Bankers Association has been marketing a similar product, Cash Flow Manager, to its member banks. While the association doesn’t have any banks in southeastern Wisconsin using the program yet, you should expect to see announcements of banks offering the program starting this year.
    Factoring – or as these banks prefer to call it, accounts receivable financing – is no longer just for the big companies which want to fully outsource their credit and collection functions. Smaller businesses that need to free up some of their working capital should consider factoring.
    Modern programs offered by banks today are much more geared to providing financing and are designed not to have the negative customer relations impact which was often associated with factoring in the past.
    Additional information on factoring in this area and a list of Internet addresses is available on our web site at http://www.execpc.com/~devitt/.
    Michael Devitt is president of Devitt Consulting Group in Shorewood. Small Business Times readers can contact him at 962-4414, or via e-mail at Devitt@execpc.com.
    June 1998 Small Business Times, Milwaukee

  • Making the switch from DOS

    Going from DOS to Windows-based accounting system
    You’ve had the kickoff meeting with staff and consultants. The initial schedule that covers every moment of time involved in the conversion is in place. All accounting coding schemes from your new chart of accounts to vendor, customer, inventory and employee IDs have been redesigned. The server, workstations and software has just been installed. What could go wrong?
    Sunstone Financial Group, Inc., a company that provides fund accounting and administration along with shareholder servicing, distribution, marketing and advertising support to investment companies, mutual funds and their advisers, recently made the switch to Solomon IV for Windows and is currently in the process of running parallel. The company is dealing with some typical situations that commonly occur during a transition to a new financial software application.
    Sunstone controller Christine Mortensen had the following experience after returning from vacation:
    “I waited until late Friday to call in and get my messages. One after another was about the problems they had with one of the servers going down and the domino effect it had on the Solomon IV users. Keep backups. Keep daily backups. The data was all there. It really wasn’t so much of a problem. But you don’t know that at the time it is happening.
    “Time constraints are placed on everyone. No matter how realistic you think you are, you aren’t. That is stressful and draining on you and your staff. It’s also a shock to know that other system errors – like the server crashing, totally unrelated to your financial software application – still interferes with your processing time. Teach as many users as you can similar functions. And do what I did – take a vacation in the middle of it all. It puts everything in the proper perspective.”
    Truthfully, you should expect nothing less then a ride on a bucking bronco.
    System, software
    & staff troubles
    Training begins and instantly, as anticipated, some staff members are reluctant at the extra work hours needed in running parallel. Performing some job functions is bad enough one time through, but having to do it twice is a nightmare. There’s operating system trouble. Workstations or servers crash, and no one seems to know why. That may cause software trouble. You and your staff are bothered by the unexpected errors that never occurred during the smoothly executed demos.
    Some users are slower than others. Or, it seems they missed everything covered in the training sessions, causing additional software problems and incorrect data entry. This takes additional staff time to correct. Consider using a Buddy System. If you pair employees together, slower with faster learners, you will increase the learning curve for all and come up to speed quicker.
    Communication through formal and informal meetings will also improve workflow. Consider purchasing customized procedure manuals to reinforce training. Manuals also ensure quality retraining if turnover occurs.
    Software support & documentation
    Know where your software support is coming from – directly from the vendor or from your consultant – and who specifically has been assigned to handle your account. Designate the most knowledgeable employees as system record keepers. You should keep a detailed log of software arrors, documenting how they occurred and at what moment in processing. It’s helpful to paste error screens into Word documents so that you can print and fax them, if requested, to your support person. When resolutions are delivered, log them as well. Share these problems and resolutions with all involved in similar job functions. What one employee learns through trial and error can be an important lesson for all.
    Data pumping &
    report generating
    The initial focus in bringing your system to life will be data entry, pumping information into each of the financial modules, and matching account information against your old system during the parallel run. Beyond matching the general ledger, you’ll want to see the reports which display the information completed in data entry. Bring sample reports to the training sessions. Analyze those reports at the front-end to determine the exact information you are looking for. Your consultant will be able to demonstrate where those reports reside in the new system and can walk you through how to customize existing reports if they need to be modified to meet your specific requirements.
    Positive attitude
    The most important area that can make or break the use of the new system is holding onto a positive attitude during initial training and solo runs. Understand that the problems you encounter weigh heavily on your employees who may be easily influenced and in a vulnerable frame of mind at this early stage of using the system. You cannot gain total functionality within a week or two; the struggle typically ranges from three to six months. It takes a number of cycles of using the system before you and your staff know the best way to maximize its potential.
    Going live
    Determine the appropriate moment in time to run live. Clearly, you’ll want to be positive that the parallel systems are balancing, that checks and invoices are printing correctly, that the financial statements are complete and accurate. Once the decision’s been made, ask your consultants to be on site to address any problems quickly. I recommend that, shortly after going live, you retrain your users again. Training after going live pulls everything together.
    Over time, each user will gain a broader-based background of the available functionality of this software. Financial application software built to run in Windows brings a new world of possibilities if you are up to the challenge. Stay educated, keep informed and congratulate yourself and your staff for a job well done.
    June 1998 Small Business Times, Milwaukee

    Cybertoons

    Milwaukee’s Cybertoons is on the digital edge
    Milwaukee will never be confused with traditional high-tech hotbeds such as Seattle, Boston, or California’s Silicon Valley.
    But a small, relatively unknown software development company may be on the verge of putting Milwaukee on the digital map.
    Cybertoons Digital makes software that enables people to build Websites without having to learn complicated Web publishing procedures. Forget about FTP’ing to your remote file server. With Cybertoons’ MyCyberWeb software, all you do is point and click. The process literally takes only minutes, and presto! You’ve got an instant Website.
    Cybertoons’ proprietary software made its debut in February when it was licensed by M&I Bank. Bank customers who sign up for Internet banking automatically receive the ability to develop their own Website free of charge – sort of the digital equivalent of the free toaster.
    “It is going over very well with our customers,” says Paul Steger, M&I vice president of corporate marketing. “The ease of use with their system is readily apparent, and right now, is out-front compared to anything else on the market.”
    Cybertoons’ former stock-in-trade – creating impressive three-dimensional video animation for clients like ESPN – today represents only 15% of the company’s business, says Andy Flessas, the 28-year-old whiz who is the creative brains behind the company, and who, with his horn-rimmed glasses, appears to be a cross of Buddy Holly and a not-so-mad scientist.
    The shift from 3-D animation to software development was a natural because the MyCyberWeb software offers so much more promise, and the 3-D animation field is saturated, Flessas explains.
    As sometimes happens, Flessas and Cybertoons arrived at the concept of the MyCyberWeb quite by accident.
    Three years ago, customers started to ask if Cybertoons could build Websites for them to enable the 3-D images to be delivered in dedicated fashion. Flessas and a small team of software developers built Websites for Appleton Papers, Navistar International and Northwestern Mutual Life Insurance. Then, some of its customers started to ask if Cybertoons could develop a means so that they could change their Web pages on their own.
    “So, we developed software with back ends on it that would allow non-technical people to make changes to their own Websites without having to come to a technical person to do it,” says Cybertoons president Steve Sinicropi, who left the general manager’s position at Milwaukee radio station WLUM-FM one year ago to join this promising medium.
    A shift in strategy
    The next logical step for Cybertoons was to develop software with a specific design that would allow any non-technical person to build and maintain a Website. And thus, the MyCyberWeb software was born. The proprietary design is built on a platform developed by Oracle Corp.
    “So now with this software, any individual or business can build and maintain a corporate quality Website with point and click ease,” Sinicropi says. “All it takes is a simple Web browser and an Internet connection, without having to download any software.”
    The software is designed primarily for banks and other financial institutions who want to create “communities” consisting of their customers. By offering the free Websites, banks such as M&I are free to offer their customers other products through the Internet.
    Based on a prediction by The Gartner Group that 50% of all banking will be done online by the year 2003, it would appear as if Cybertoons is on to a good thing.
    “This is where banking is headed,” adds Steger.
    What differentiates Cybertoons from the competition is that it gives people more tools than they can figure out. Flessas’ strategy is to always give consumers a little more than they can use, so it buys time until he can develop something new. The strategy is akin to keeping a small child happy with a toy.
    “We are the only one doing this on the planet,” Sinicropi says. “We developed this software using Oracle technology. It’s powerful, it’s scalable, and it does all the things that a business wants it to do. We own this software, and it’s very powerful.”
    Another advantage is that all of the Websites are hosted by Cybertoons, which means that you are not tied to an Internet Service Provider (ISP) who hosts the site. If you are an M&I customer, you can access your Website even if you’ve just switched your ISP from America Online to Exec PC, for example.
    The software allows the user to import visual images and add additional Web pages in a way that competing offerings cannot match.
    “I think the way they have done it is more robust,” Steger says. “There are other site developers like Geocities. But, when you look at what they give you, versus what MIWeb gives you, they are out ahead.”
    Cybertoons has also developed an electronic commerce module which allows businesses to set up Websites in which customers can buy products from them online. This is an ideal arrangement for retailers who want to minimize overhead, Sinicropi says.
    “If you are going to open a store, you’re going to have to get a lease or build a building,” he says. “Then, you
    “If I can do what I do now with 14 guys, imagine what I can do with 400. The IPO will give us the kind of brute force we need.”
    – Andy Flessas, Cybertoons Digital
    have to stock it with inventory and you have to hire employees. So, you’ve got all of this capital tied up in infrastructure.
    “But, if you build one Internet store, it is open 24 hours a day and you don’t have to have any people and you don’t have to stock inventory,” Sinicropi says. “People can buy whatever they want at times that are convenient for them from the privacy of their own homes. It’s always open and it’s always easy.”
    To support his contention, Sinicropi points to Egghead Software, which recently closed all of its retail outlets. Amazon, which is the world’s biggest bookstore, does business solely over the Internet.
    Store owners using the Cybertoons e-commerce module can alter product offerings with the same point and click ease. Current users of the e-commerce module include Hal’s Harley-Davidson and Car Phones Plus.
    Small business can buy into the software for as little as $2,500 without the commerce module included, and $7,500 with it. The ability to offer a community of Websites starts at $50,000 and up, depending on the particular needs of the business, Sinicropi says.
    The next big thing
    Since last year, Cybertoons has grown from six employees to 22, with the majority coming in the form of computer programers. So, how does Milwaukee stack up to the big boys when it comes to attracting top-notch software developers?
    “As far as being competitive, our guys stack up,” Flessas says. “They are as good or better than what is out there. They (the traditional hotbeds) certainly beat us in sheer numbers. But, you can put us up against any team anywhere, and we’ll kick their butts. We can move quicker than larger corporations. We can engage faster because we are not bound by linear corporate structure.”
    If Flessas has his way, the company will grow exponentially. An initial public offering is planned within the next three years, he says.
    “The IPO will give us access to massive amounts of R&D money, and give us the kind of brute force we need,” Flessas says, adding that he would like to have a team of 400 software engineers at his disposal. “With that kind of crew, I can make the kind of strike that I need to make. If I can do what I do now with 14 guys, imagine what I can do with 400.”
    In the digital arena, what was a hot new technical advance can become obsolete virtually overnight. There is pressure to come up with the next big thing.
    For Cybertoons, that means intelligent digital agents. Programers are currently working on Internet software that will act as an intelligent digital assistant. This is considered the next step in tapping the vast potential of the Internet and making it easier to use.
    “It says ‘Hello Andy, what are you interested in?'” explains Flessas. “The software talks to me in text. I can respond to it and tell it what my intentions are. It is an expert system that is hung off the Web with an inference engine. The users interact with this almost like they would with a search engine.”
    The intelligent agent is the equivalent of walking into a library and asking the librarian for help instead of blindly searching the volumes.
    “This is really cool, because it works 24 hours a day, there is zero variance,” Flessas says. “Through interaction with this thing, it will log what it doesn’t know. This allows us to make this thing smarter.”
    Expect to see an intelligent agent software product coming out of Cybertoons sometime this fall.
    What kind of face will Flessas & Co. put on the intelligent agent?
    “The philosophy here is, instead of putting a character’s face on the agent, we want to the user to perceive the agent like you would a character in a book,” Flessas says. “You visualize that character. This way, the user will tend to perceive the agent something more toward themselves. That will make it more successful.”
    Flessas and several Cybertoons engineers were recently invited to Oracle’s R&D testing facility in New Hampshire. While Flessas can’t discuss what he saw and toyed with, it’s safe to say he has seen the future of Internet technology two years out, and it’s impressive.
    What Flessas fails to mention is that not just anyone gets invited to gain a glimpse of the technofuture according to Oracle. You have to be an innovator.
    It is safe to say that Flessas and Cybertoons have earned a place among the software innovation elite, as they seek new ways to open up the Internet to the masses.
    June 1998 Small Business Times, Milwaukee

    Stay up-to-date with our free email newsletter

    Keep up with the issues, companies and people that matter most to business in the Milwaukee metro area.

    By subscribing you agree to our privacy policy.

    No, thank you.
    BizTimes Milwaukee

    Holiday flash sale!

    Limited time offer. New subscribers only.

    Subscribe to BizTimes Milwaukee and save 40%

    Holiday flash sale! Subscribe to BizTimes and save 40%!

    Limited time offer. New subscribers only.