8 Annual Anthony Ford Pond Hockey Classic th
February 6 & 7, 2016 8:00 a.m. - 5:00 p.m.
Spring Lake Park North Mankato
DIVISIONS:
TEAM ENTRY FEES:
February 6th: Adult Men & Women
Deadline: Midnight, January 23, 2016
February 7th: Youth Mites and Up
$300 Adult ($270 if registered by Dec. 31) $180 Youth ($150 if registered by Dec. 31)
The Anthony Ford (AF99) Fund The AF99 Committee was formed by the family and friends of Anthony Ford, who passed away from leukemia at the age of nine. Anthony was bright, outgoing, and compassionate with a love for life. Throughout his 18-month battle with cancer, Anthony lived his life to the fullest, determined never to allow his disease to interfere with doing the things that he loved. Anthony’s biggest passion was hockey. He proclaimed himself The Next Great One and took the number “99” after Wayne Gretzky, whom he met. A banner bearing his name hangs in the Verizon Wireless Center to remind us of his courage, determination, and dream of playing in the NHL. In the spirit of Anthony’s dream of playing hockey, the Anthony Ford Committee was founded in 2007 by friends and family to establish a fund to help find a cure for childhood leukemia and help other young hockey players to be The Next Great One.
SPONSORED BY:
A Proud Rink Sponsor
TOURNAMENT FORMAT: • 3 game guarantee • 12 rinks with boards, no goalies, modified nets • Maximum 6 players per team, minimum 4 • Adult play (3 on 3) • Youth play (4 on 4)
REGISTER ONLINE AT:
www.anthonyford99.com
FOR MORE INFORMATION: Call: 507-388-3482 Email: afpondhockey@gmail.com The Anthony Ford Fund raises money for pediatric cancer research and helps make hockey affordable for youth players.
BREAK GROUND FAIRMONT, MINNESOTA features a shovel ready certified
industrial park which is accessible by plane, rail, and interstate travel. Home to over 500 businesses, Fairmont is not only business friendly but family friendly, with over 500 acres of parkland – featuring an aquatic park and dog park, five lakes, two 18-hole golf courses and much more.
Fairmont is a great place to raise a family and grow a business.
VisitFairmontMN.com
THIS IS FAIRMONT
JANUARY/FEBRUARY 2016
Contents
THE MAGAZINE FOR GROWING BUSINESSES IN SOUTHERN MINNESOTA
STAFF & CONTRIBUTORS Publisher: Concept & Design Incorporated
BUSINESS PERSON OF THE YEAR 2016
Tom Ahern
Coughlan Companies
Editor: Grace Webb Art Director/Staff Photographer: Kris Kathmann
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Advertising Manager: Beth Benzkofer Kozitza
Our Minnesota State College of Business panel judged the CEO of publishing giant Coughlan Companies in Mankato as our 2016 Business Person of the Year.
Contributing Photographers: Art Sidner Contributing Writers: Carlienne Frisch, Tonya Rule Production: Becky Wagner
Denny Dotson/Jean Bye 32
Circulation: Grace Webb
Dotson Iron Castings
Printing: Corporate Graphics, N. Mankato
Dotson Iron Castings might be a small foundry, but it has made a big name for itself in the metal industry—and a lot of the credit goes to Denny Dotson and Jean Bye.
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8,800 for January/February 2016 Published bimonthly
SouthPoint Federal Credit Union
As Sleepy Eye Branch President of SouthPoint Federal Credit Union, Jill Berdan serves her community through her passion for financial literacy.
CORRESPONDENCE Send press releases and other correspondence: c/o Editor, Connect Business Magazine P.O. Box 452, Nicollet, MN 56074
SPECIAL SECTION
Connecting With Young Professionals
E-mail: editor@connectbiz.com (please place press releases in email body) Web: www.connectbiz.com
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Phone: 507.232.3463
As employers strive to retain young workers, communities across southern Minnesota have an effective resource to utilize: Young Professionals groups. COLUMNS
Editor’s Letter
6
Grace Notes
40
IN EVERY ISSUE
Press Releases
6
Business Trends
28
Bulletin Board
42
Hot Startz!
56
Ask A Professional
Cover Photo: Kris Kathmann
CIRCULATION
44
Jill Berdan
Mailing: Midwest Mailing, Mankato
Fax: 507.232.3373
32 44
ADVERTISING Call: (507) 232-3463
ABOUT CONNECT Locally owned Connect Business Magazine has ‘connected’ southern Minnesota businesses since 1994 through features, interviews, news and advertising. Connect Business Magazine is a publication of Concept & Design Incorporated, a graphic design firm offering print design, web design, illustration and photography. conceptanddesign.com
59 Copyright 2016. Printed in U.S.A.
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JANUARY/FEBRUARY 2016
EDITOR’S LETTER
2016 Business Person of the Year The nominations were collected, the votes were tallied and the suspense is over: We’ve got the names of our 2016 Business Person of the Year winners. A big thanks to our Minnesota State University Mankato College of Business panel of professors, who judged CEO Tom Ahern of Coughlan Companies our Business Person of the Year according to our nomination criteria, which includes business results, community involvement, personal character and leadership. Even a quick scan of Tom’s business background makes it obvious why he deserves the award. Besides doubling Coughlan Companies’ revenue in the eight years he’s been its CEO, Ahern also led Capstone, Coughlan’s publishing company, into the digital era. The company’s personalized reading program, myON, is utilized by more than six million students. Our first and second runners-up were Denny Dotson and Jean Bye, chairman and CEO of Dotson Iron Castings, respectively, and Jill Berdan, branch president at SouthPoint Federal Credit Union in Sleepy Eye. These four Business Person of the Year winners each have great stories that should excite and inspire. Thank you to all our readers who created a diverse pool of nominees yet another year. We hope you enjoy this issue. An veritas, an nihil,
Grace Webb
CONGRATULATIONS TOM AHERN, OF COUGHLAN COMPANIES, ON BEING SELECTED AS BUSINESS PERSON OF THE YEAR.
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Email: editor@connectbiz.com Fax: 507-232-3373
Blue Earth From the Chamber: New members include Breen’s/Nemanics, Parts City, Thriven Financial—Bonnema & Steinhauer and Blue Earth Locker. Express Diagnostics Int’l, Inc. (EDI) recently announced the formation of Express Diagnostics Global, Ltd. (EDG), a new subsidiary based in Sofia, Bulgaria.
Fairmont
Incentives for Job Creation SHOVEL VEL READY DY LOTS S
From the Chamber: new members include Habitat for Humanity, Computer Lodge, LLC, CarpetPlus, Hardee’s, Jillian Vortherms Agency, Fairmont National Agency, TG Equipment, Inc., JL Computers, Intelligent Hire, LLC, The Healing Place, and Christy Selbrade—Edward Jones. The City of Fairmont’s Rural Brain Gain Project recently received a $33,000 grant from the Southern Minnesota Initiative Foundation to work on a media campaign to attract workers to the city.
Mankato
New Ulm Economic Development Corporation
507-233-4305 • www.nuedc.com nuedc@newulmtel.net
From Greater Mankato Growth: new members include Big Dog Sports Cafe, Investment Management and Associates, Inc., M2 Lofts, Rignell Family Chiroprac-
tic, River Valley Dental, KingPins, Minneopa Golf Club, Partners for Affordable Housing, Shell on 3rd Ave and Starr Cycle. Tailwind Group and Community Bank were recently inducted into the Greater Mankato Growth Hall of Fame. CliftonLarsonAllen recently hired Peter Wenker and Kimberly Warling. Farrish Johnson Law Office recently hired new attorney Paul T. Moosbrugger. I+S Group recently hired Tiffany Olson as director of marketing, following the retirement of Tami Paulsen. Junior Achievement of the Upper Midwest recently announced that Cal Duis, a teacher at Dakota Meadows Middle School, has been honored with the organization’s award for outstanding educators, the Capstone Teacher of the Year. Christina Meyer of Community Insurance recently completed the Commercial Lines Academy with Grinnell Mutual Reinsurance. In addition, Meyer was also the first female named to the Fairmont Farmers Mutual Insurance Co. Board of Directors. Marco was recently recognized by the Minneapolis/St. Paul Business Journal as one of the fastest growing privately held companies in Minnesota. Marco was also recently named by Great Place to Work® as one of the best small and medium workplaces in the U.S. on the annual 2015 Best Small & Medium Workplaces list, published in
NEW ULM AREA CHAMBER OF COMMERCE Supporting the businesses who make us a special place to visit for a weekend, or a lifetime. See our historical downtown, do some shopping – open your own business! We’ll help you make it your home.
1-507-233-4300 6
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JANUARY/FEBRUARY 2016
newulm.com
Serving Southern Minnesota For Over 50 years
Fortune magazine. Ranked No. 14, this is the second consecutive year Marco has received this honor. Shannon Beal with JBeal Real Estate Group was recently awarded the Realtor with Heart Award by the Realtor Association of Southern Minnesota. JBeal Real Estate Group also recently hired new agent Anthony White. Century 21 Landmark Realtors recently hired LeAnn Valentine at its Mankato office. United Prairie Insurance Agency (UPIA) is offering a free, in-person MNsure enrollment center in both Mankato and New Ulm until enrollment ends on Jan. 31. Region Nine Development Commission (RNDC) recently received a $30,000 grant from the Minnesota Department of Health and the Minnesota Pollution Control Agency to conduct an HIA on RNDC’s Climate Change Adaptation Plan. Minnesota State University, Mankato was recently named one of the nation’s most outstanding business schools, according to the The Princeton Review. Minnesota State Mankato’s College of Business has been included in The Princeton Review rankings since 2006 (10 years in a row). Atwood Property Management recently hired Megan Miller as general manager. Jones and Magnus, Attorneys at Law recently hired Kelsey M. Murray as an associate attorney. Blethen, Gage and Krause recently hired Alyssa K. Thibert as a new attorney. Kato Insurance Agency, Inc. will be relocating to the second floor of Profinium Place on April 1. First National Bank Minnesota recently hired bank officers Michael Laskey and
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Jana Finken. Jerry’s ABRA Auto Body & Glass recently donated a refurbished vehicle to a single mother of two, a yearly tradition since 2008. Westman Freightliner was recently acquired by Harrison Truck Centers, headquartered in Clear Lake, Iowa. Harrison Truck Centers plans to retain all Westman Freightliner employees.
507-345-6260 robinsonappraisalmn.com appraisal@hickorytech.net 115 E. Washington, Mankato *State certified/licensed appraisers
Commercial Industrial Agricultural Properties
Mapleton Pioneer Bank recently hired Dan Benrud as an assistant vice president, ag/business banker.
NEW ULM
Title Resources LLC Title Resources LLC, a full service title company owned by Gislason & Hunter LLP, and Lamm, Nelson & Cich have combined to provide full residential, commercial and agricultural title services including title insurance, insured closings, e-recording, abstracting and construction disbursements.
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From the Chamber: new members include Pike Driving School and E J Vacations & Pilgrimages, LLC. The City of New Ulm was recently named to a national list, Top 10 Affordable Small Towns Where You’d Actually Want to Live, by Realtor.com. Junior Achievement of the Upper Midwest recently received $1,000 from the New Ulm Area Chamber of Commerce to implement the JA Career Success program for New Ulm area ninth graders. Gislason & Hunter LLP recently hired Brittany King and Dean Zimmerli as new attorneys. Zimmerli will be located in the firm’s New Ulm office, while King will be based in the firm’s Mankato office.
507.345.3388 signpromankato.com 301 Webster Avenue, North Mankato
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JANUARY/FEBRUARY 2016
Web Site
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St. James Call Karla VanEman today! (507) 345-4040
INSULATION Commercial & Residential greener world solutions 507-625-3626 • Waseca, MN
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Super 8 has made bicycles available for their customers. In addition, ADA pool lifts have been installed at the pool and spa at Super 8. Dave Holmgren is a new member of the St. James Area Convention and Visitors’ Bureau. Dena Gress is the new administrator of the St. James Good Samaritan Campus. Jamie Scheffer has been named the new St. James Economic Development Director. St. James Sertoma Club donated money for Christmas light decorations for the downtown area.
Sleepy Eye The Chamber recently awarded the 2015 Manufacturing and Technology Award to Lifetime Eyecare Center.
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CONNECT Business Magazine
Springfield Chamber special events will be the Prom/Bridal Expo on Jan. 10 and a Cheers Wine/Chocolate Event on Feb. 6.
Waseca From the Chamber: Recent Progress Awards were given to Paul DeMorett, Community Education Director; Jesse Sherman, plant manager at Cinch Connectivity So-
JANUARY/FEBRUARY 2016
WASECA
PANTHEON COMPUTERS Pantheon Computers of Waseca, Albert Lea and Faribault recently added a fourth location in Mankato.
lutions; Chris Elvebak, City Community Development Director; Tom Borowski, administrator at Mayo Clinic Health System, Zack’s Customs, Alee Services, and Barden’s Bar; as well as Thrifty White Pharmacy for its recent opening. A Roots Award was recently given to Prairie Dental Arts. First Dollar Awards were recently presented to Crossings Inn & Suites, Current Rays, Pleasant Grove Pizza Farm and Farmhouse in the City 1890. Theresa Sunde of Mediacom has been awarded the Mediacom Outstanding Achievement and Community & Government Relations Awards. Scott Roberts is the new director of the Waseca Art Center. Julie Poehler is the new floral manager at HyVee. Amy Swain Hearing Center of Waseca, Owatonna and Austin will soon be expanding to Rochester. Berg’s Pharmacy of Waterville and Thrifty White Pharmacy in Waseca have combined their businesses to the Thrifty White location. SMILES Center for Independent Living recently celebrated 25 years of service.
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By Grace Webb Photo by Kris Kathmann
Our Minnesota State College of Business panel judged the CEO of publishing giant Coughlan Companies in Mankato as our 2016 Business Person of the Year.
Digital Pioneer The 1800s were a century of great discovery, exploration, resourcefulness and achievement. Millions of immigrants arrived in America, drawn by the country’s promise of equality and freedom. While some settled in established cities along the East Coast, others braved untamed wilderness as they pushed farther west into states such as Wisconsin, Indiana—and Minnesota. Irish immigrant T.R. Coughlan was one of those pioneers, choosing Mankato as his new home. Working at first as a masonry foreman, he soon struck out on his own, starting Mankato Kasota Stone, one of the oldest family-owned quarries in the state. Limestone from those quarries can be found around the world, from the University of St. Thomas in St. Paul to the Shanghai Grand Theater in China. Over the decades, each generation of Coughlans expanded that legacy of entrepreneurship and innovation. In 1990, they bought and revitalized Capstone Press (now Capstone), creating Coughlan Companies as a holding company for it and other business ventures. Over the years, Coughlan Companies has grown to employ more than 400 employees and earn about $100 million in annual revenue. In 2007, Coughlan Companies entered into a new era of innovation thanks to the addition of Tom Ahern. As CEO of Coughlan Companies, Ahern led the business into the Digital Age, launching a massive initiative to convert Capstone’s print content 10
CONNECT Business Magazine
Tom Ahern
CEO, Coughlan Companies BUSINESS PERSON OF THE YEAR 2016
into online form. That also led to myON, a personalized reading program that is used by more than six million students across the world. Along the way, Ahern doubled the company’s revenues and brought it into the international market. He also picked up the title of 2014 Ernst & Young Entrepreneur of the Year for the Upper Midwest (which he shares with Robert Coughlan). Ahern might not have arrived in Minnesota on a covered wagon, but he’s a pioneer nonetheless, forging into uncharted territory with a nearly unbelievable enthusiasm. He is somehow able to combine brilliant ideas with down-to-earth practicality, turning his innovative vision into successful reality. There’s no road map for where he’s going, but that’s not going to stop him. It’s no surprise, then, that Ahern was named our Connect Business Magazine 2016 Business Person of the Year. continued >
Business Person of The Year 2016 winners selected by MSU Mankato College of Business faculty.
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Tom Ahern | Business Person of the Year 2016: 1st Place
Where did you grow up? I’m from all over. I was born in Connecticut, but we moved shortly after I was born to Kansas City, Kansas and then to the area where I really grew up, northeastern Ohio. I’ve moved from one coast to the other and have been in Minnesota for 27 years now. What did you enjoy as a kid? I played every sport. My favorite was basketball, but unfortunately I was best at football. Throughout high school, I participated in baseball, track, basketball and football. I was also president of Student Council, involved in the yearbook committee and part of the chess club. As my father used to say, I was always going nine ways to Sunday.
Our People have listened carefully to our clients and communities for over 50 years. After all, our Process begins with lending an ear. 507.625.2727 | aemcpas.com
What was your first job? My very first paid job was as a busboy at a buffet for 85 cents an hour. It was a summer job, which I kept until football practice started. My parents didn’t ask me to work, but I wanted to start earning my own money. Another summer, I worked at a boat dock. Then I earned my advanced life saving certificate and became a lifeguard for the next three summers at Farmer Jims, a large recreation park with a man-made lake. It was the size of a football field, with the swim dock out where it was above everyone’s head, and the place was very dangerous. As the day wore on, we’d have 7,000 people at the park, and people would be drinking. Typically, it was guys who were going to be a problem. As they’d drink more, they’d convince their friends who weren’t good swimmers to go out and try to swim… and you knew they weren’t going to make it. They eventually had to shut the place down. Did you ever have to save anyone? I probably had about 12 saves a summer. I had a couple swimmers
Tom Ahern | Digital Pioneer
Getting to know you:
Tom Ahern Family: wife Candy; children Kelsey, 25, Ryan, 23, Tess, 20 Education: Northwestern University (1980) Hobbies: golfing, traveling, boating, volunteering Lives: Lake Minnetonka If he wasn’t doing this: “I’d be working. I thought I wanted to retire early when I was in my 40s, but I’d drive my wife crazy. I want to stay active.” 12
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Digital Pioneer | Coughlan Companies
Tom Ahern | Digital Pioneer
Community Connection When it comes to giving back to the community, Coughlan Companies is involved in more ways than you can count. There’s the Capstone Literacy Center, started in 2012 to offer free specialized instruction from trained tutors for struggling readers in grades 1-5. Many of the volunteers come from the company’s employee base. Continuing with the literacy theme, Capstone donates thousands of books a year to different causes and locations. Every child in Blue Earth County receives one book a year from birth to when they go to school, while Capstone teams up with the Southern Minnesota Initiative Foundation to donate thousands more books across the southern Minnesota region. Capstone has also sent books to victims of the 2013 tornados in Oklahoma and students in Africa (sending 300,000 books in 2010 alone), to name a few. Starting in 2010, team members have begun volunteering in Cuna Maya, Mexico. It started at the company’s annual sales meeting in Cancun, when some of the employees suggested volunteering at a mission in the jungle they supported. “A bunch of us went,” Ahern said. “I got a machete and was hacking down weeds, and other people walked around delivering books and candy to kids. These people have nothing. They’re primarily single mothers and their kids. Their houses are built with whatever’s there, like bricks and corrugated steel. Yet these kids, they show up and they’re so appreciative of everything.” In the annual trips since then, the group built mini-libraries throughout the village for the residents to use. Now the plan is to wire the entire community to provide internet access, iPads and online educational content. “We’re trying to give the kids access to the world,” Ahern said.
Jay Weir
Mike Donohoe
The James R. Weir Insurance Agency has merged with Arthur J. Gallagher, one of the worlds largest insurance brokers. We both share the same philosophical commitment that puts our clients first and now we can offer our clients a greater level of specialized insurance and risk management insurance expertise. The merger represents the coming together of two well known companies to better enhance our client relationships.
Arthur J. Gallagher & Co. Phone: 507-387-3433 208 N Broad Street | Mankato, MN 56001 3600 American Blvd. West, Suite 500 Bloomington, MN 55431
JANUARY/FEBRUARY 2016
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Tom Ahern | Business Person of the Year 2016: 1st Place
who were completely passed out at the bottom of the lake, that I had to find, swim down, pull in and resuscitate. But nobody died in the three years I was there.
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Did you ever have any close calls yourself? Oh, yeah… I had one guy who was completely panicked. I got him breathing on the way in to the shore area, and that’s when he freaked out. Unfortunately, the novice lifeguard, who had frozen on the save, didn’t clear the diving board either. So as I’m coming in
Tom Ahern | Digital Pioneer We offer completely customized and personalized menus for any event, large or small. Our professional wait and bar staff can fulfill all your culinary and beverage needs. Your menu choices are limited only by your imagination.
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JANUARY/FEBRUARY 2016
Working With The Coughlans Ahern has nothing but good things to say about working with the Coughlan family. “They’re very much entrepreneurial,” he said. “It’s not a culture that’s afraid to take a risk, which is fun. I’m not in a likely ‘no’ scenario. If we build up a case, if we think there’s a business opportunity, I’m usually pushing on an open door.” Ahern added that working at Coughlan Companies is much different than his old jobs, where he either had to answer to thousands of shareholders (as a public company) or to a large group of angel investors. For him, one of the best parts of being part of Coughlan is the company’s focus on the future. “We’re looking long-term,” he said. “When you have thousands of shareholders or you’re an early stage company, you’re kind of looking out just over the hood of the car while you’re driving. I’ve had situations like it’s Friday and you have to make payroll on Monday and you’re not sure how you’re going to do it. Every quarter, you think about that quarter. You’re trading off what you should probably do right for the long term, but you’ve got to make this quarter. What I like about this company is that we’re really looking at the long-term gain.”
Digital Pioneer | Coughlan Companies
Tom Ahern | Digital Pioneer
Mankato Kasota Stone While the Coughlans might be focusing most of their attention on the publishing industry right now, the family business actually started in the stone industry. Founded in 1885, Mankato Kasota Stone was a fixture in the Mankato community for more than 135 years, providing high quality dolomitic limestone in unique yellow-pink color variations. Mankato Kasota Stone made the news in 2013 when the Coughlans announced they were suspending operations because of a loss of construction projects due to the recession. More than two dozen employees were laid off as a result, though many were transitioned into Capstone and Jordan Sands. “I think our challenge was how it was so capital intensive and probably needed such a huge reinvestment in the infrastructure,” Ahern explained. “The market as of late has been very tough.” Ahern said Mankato Kasota Stone has suspended operations in the past when the economy warranted it. He added that the plan is to focus on Capstone and Jordan Sands for the time being. “We were at the point where our investments on the publishing side of things were all making huge returns, and we also discovered that right below the limestone was some of the best frac sand in the country,” he said. “So we said it was probably a better investment to get the best frac sand out than to go to dimensional limestone.” According to Ahern, the company may resume operations if and when the Coughlans feel it makes sense. “I think we’ll let the market tell us when it’s time to start up operations again,” he said.
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CONNECT Business Magazine
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Tom Ahern | Business Person of the Year 2016: 1st Place
“In hindsight, I could have done a lot better if I’d applied myself. But I think that actually helped me later. I see some kids now, where they work so hard to get a job, and then they expect someone to give them something when they get to work. But really, once you get there, it’s time to work.” to bring the guy in, somebody almost dove in on top of both of us. There were some close calls. I was young; I didn’t know any better. But you had to pay attention. There was always a save going on over the weekend. What subjects did you enjoy in school? I was probably not the most studious. Frankly, I was more interested in all the activities going on and got the grades I needed to get. In hindsight, I could have done a lot better if I’d applied myself. But I think that actually helped me later. I see some kids now, where they work so hard to get a job, and then they expect someone to give them something when they get to work. But really, once you get there, it’s time to work. I felt that I was mentally ready to dive in and
apply myself. And I was fortunate that it was really probably football that got me out of that area, since I got a football scholarship to play at Northwestern University. At the time, Northwestern was the fifth most expensive college in the country. There was no way my parents were going to be able to afford that. So I knew not succeeding was not an option. How did your college team do? We lost a lot of games. My mother used to say, “Losing builds humility,” and I would reply, “Mom, I’ve got enough humility. I need a U-Haul to carry all this humility.” We would typically win one game a year. Football at Division 1 level was a year-round sport, so you’ve got winter workouts, spring ball, summer workout, fall season. It’s a full-time commitment, but by God, every year, we
Tom Ahern | Digital Pioneer
Jordan Sands As the demand for silica sand increased because of the expansion of domestic oil and gas production, the Coughlans moved forward with their plans to mine about 70 acres of their old quarries, starting in Jefferson Quarry, and use another 40 acres for sand processing. It took three years for the somewhat controversial project to obtain all the proper permits, but the project was finally approved in August 2013, with operations starting in spring of 2014. The operation includes the mining site, a wet plant to wash the sand, a dry plant where the sand is dried and sized for different uses, and a rail-loading site. While local residents raised concerns about the impact of sand mining on the Mankato area, 16
Ahern said the company has gone above and beyond to ensure environmental protection. “[Obtaining the permits] was a daunting process, especially in Minnesota, but in the end, we did it right,” he said. “If they asked for x, we’d do x plus. We’ve been in the community for 135 years. We’re going to do things that are right for the long term of the community.” To ensure that the operation was safe, the company volunteered to do ambient air-monitoring at the plant and mining sites where the air is sampled every six days. This data is provided to the state of Minnesota and Lime Township on a regular basis. The company also agreed to keep trucks off the road during the busy morning commute time, and it has a robust fugitive dust program in place. While Ahern said the state-of-the-art operation is even more efficient than they planned, Jordan Sands was hit by a curveball in late 2014 when global oil prices dropped to nearly record levels. The business was able to save substantial money on transportation since it sits right on the Union Pacific Railroad, but it has still been a tight economy in recent months. “We did not expect the market to do what it did,” he
Digital Pioneer | Coughlan Companies
thought that next year we were going to the Rose Bowl. But you’ve got to have that kind of attitude to get you through a whole year of prep for a season that’s relatively short. What was it like to go to such a highly ranked college after not trying too hard in high school? I was ill-prepared. Many of those students came from private schools and boarding schools, so I had a lot of catch up to do when I got there. The interesting thing was, the athletic department did nothing to support your academics. I was recruited by a number of other colleges that promised, “We’ll take care of your classes.” But I remember thinking, “Well, what do I end up with? After four years, I haven’t gone to school. Do I even get a degree?” It wasn’t the path I wanted to go. At Northwestern, it was the opposite approach. They expected you to deal with the academics on your own. One example is how you had to take a pre-test for calculus to determine what level you were supposed to go in. I took the test, got into this level of calculus, and the first day the teacher asked, “How many of you have not had this level of calculus yet?” And of 55 students, I was literally the only one who raised my hand. I thought to myself, “Oh, I’ve made a mistake.” That was the best C I’d ever gotten.
Since 1883 Nicollet County Bank
said. “We’ve had to be much more flexible, much more aggressive. We’re fortunate that we’ve made it through this so far, cash-flowing. Life hands you curveballs. I would have never expected myself to be at the gas pump and see gas at a buck something and be upset. But then, I never thought I’d be in the frac sand energy business.” Jordan Sands extracts about half a million tons of sand a year, sending most of its product to Texas. About a fourth of the sand is used to make glass bottles. The company has obtained permits for about 15 years of mining, but Ahern said the plan is to continue operations long after that. “I think the [Coughlan] brothers would say they’re looking at a long-term minerals play as part of the company and the family heritage,” he said. “I think there’s opportunity to expand the facility and employ more folks. We’ll just time that with when the market comes back. It’s almost an unprecedented downturn that we’ve seen as a result of this, and I think it’ll last a little longer than we anticipated. We just have to ride out the storm and do all the things to position ourselves when it rebounds.”
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Tom Ahern | Business Person of the Year 2016: 1st Place
Did you have any jobs in college? NCAA rules were pretty strict on not having the student athletes have any kind of regular job, but a number of us did get hired as heavy security for the biggest rock and roll concerts in the Midwest. So we’d work at concerts featuring Led Zeppelin, the Stones, Tom Jones, The Who. I probably did 50 concerts. It was not fun, to be honest. I always thought of myself like a basketball player; I would want to manage the situation. Doing heavy security at rock and roll concerts, people are drunk or drugged up, and there are a lot of times that come up where you have to get physical. That’s not my makeup. Most of the time, I was able to calm things down. I took pride in being able to diffuse the situation and get people back to where they were supposed to be. Do you have any crazy stories from one of the concerts? I think the worst one was the first one I did. It was in the Pontiac Silver Dome with
“I worked in their Aerospace Division, where they created militarized versions of computer hardware and storage equipment that could fit on jet fighters, submarines and aircraft carriers.” Led Zeppelin. There were 88,000 people attending on “festival seating,” where it’s first come, first served. I was one of three guys between the stage and the crowd, and they’d built a nine-foot barricade between the two. The problem was, the band was an hour and a half late, so people started pushing from the back of the field. There’d be waves of people coming and pushing and falling. They’d get up to the barricade and they were getting crushed. So we’d have to reach over and pull people up over the barricade. Some of them needed medical attention, though nobody died. Not only that, somebody threw an M-80
(firecracker) over, and it landed right next to my head and blew up. So I couldn’t hear very well for a while. It was just a terrible day. I think I made $37 on that one, and I remember thinking, “Is it worth it for all this?” But all that just builds character. You graduated in 1980. What came next? I had an opportunity to get a job in Minnesota at a big Fortune 100 company called Control Data. I worked in their Aerospace Division, where they created militarized versions of computer hardware and storage equipment that could fit on jet fighters,
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submarines and aircraft carriers. It was really cool. We’d get these contracts to provide F16s’ onboard equipment storage devices, and so it’d be a $10 million contract. My job was to take that contract and provide work orders for everybody, and I’d track all the costs against those work orders. It was a great first job because I worked with everyone: research, development, marketing, sales, product management. Everybody was in that one building, so I got to see how a whole company operated. I did that for about 18 months, and then I tried my hand at programming. A coworker and I started writing this program in Fortran
5 language to automate our spreadsheets. About a month into it, I got the realization that I probably was two or three thousand lines of code into an 400,000 line of code solution. And I said, “I don’t think this is for me.” I didn’t have that much patience. At the same time, somebody I respected told me to get into sales. At first, I didn’t think it was for me, since I’m not pushy. But he was very successful. He was in this whole new really creative area where the company was one of the first to look at applying technology and computers to education and training. That was one of 40 sales positions and channels that Control
Data had. I looked at all 40 and said, “If I’m going to sell, I’ve got to sell something I can get passionate about.” I decided I didn’t want to sell a hard drive or a mainframe, but I got really intrigued by this new education business. And I decided I wanted to move to California. So I interviewed in L.A. and San Francisco, and I got the job in San Francisco. What did you do there? I worked with a division of Control Data called PLATO Learning. My bosses said, “You have part of the San Francisco bay area to call on anybody who wants to listen
“If I’m going to sell, I’ve got to sell something I can get passionate about. I decided I didn’t want to sell a hard drive or a mainframe, but I got really intrigued by this new education business.”
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Tom Ahern | Business Person of the Year 2016: 1st Place
about how to apply computers to education and training.” I’d call on San Mateo Middle School or Wells Fargo, where they wanted to automate their teller training. But eventually you started running training centers instead. I actually sold the first Fairbreak training center for Control Data in California. This center was focused on serving the needs of socioeconomically disadvantaged youth. I got a training program funded in the east bay, to train 55 local youth into computer repair. We got that center up and running, and we placed 95 percent of young adults into high paying, long-term career jobs. That worked so well, I expanded that center, and over the years I ended up with 17 centers up and down the west coast. No one had done this before; I had to sell the idea, find the real estate, negotiate the real estate, hire the staff, train the staff, explain what the contract was, and do it several more times that year. There was no blueprint about how to get it done. You just figured it out. The state started paying me for unemployment retraining, so I was getting these $5 million contracts. I’d just negotiated a $10 million contract from the state when the company president told me to fly
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What Others Say “Tom is truly an exceptional executive and more importantly an exceptional person. He is what all business people should aspire to be. He is an asset to Coughlan Companies and more eminently to our community.” –Robert Coughlan, principal of Coughlan Companies
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“Tom is a leader, not only here at Capstone, but in the entire publishing industry. He has created a model of how a publishing company can not only survive in the digital age, but thrive as well. This vision cannot be overstated.” –Dennis Miller, retired board of directors, Coughlan Companies “I have had the opportunity to know Tom Ahern for over ten years, and have worked with him for almost seven years at Coughlan Companies. When I think about these years, it is without hesitancy that the things that come to mind are Tom’s leadership, character and integrity.” –Bill Rouse, COO at Coughlan Companies
Digital Pioneer | Coughlan Companies
back and meet him in Minnesota. At the time, Control Data was not doing well. The mainframe business was being lost to micros, minis and personal computers. But my group was doing well. When I got back to Minnesota, I sat in on a staff meeting, and the president proceeded to tell the group that the employment training division, where I worked, was shutting down. I sat there thinking, “He doesn’t mean my group, since we’re profitable.” So I followed him back to his office, after the meeting was done, and asked about the $10 million contract. And he went, “What part of the meeting didn’t you understand? We’re shutting it down.” So they shut down that group and focused everything on implementing PLATO software into schools, and they asked me to be a regional manager. I managed the K-12 education group, eventually running almost all operations from San Francisco. In 1988, I was relocated back to Minnesota to run sales nationwide.
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“I helped drive PLATO Learning at the point of its acquisition from about $3 million to an IPO (initial public offering) several years later, and ultimately to more than $100 million in revenue.” PLATO Learning was sold shortly after to William Roach, founder of Edu Corp. How did that change affect you? That actually ended up being the best thing for me, since I wasn’t part of this big monolith that was struggling to figure stuff out. We were our own division in our own company. I helped drive PLATO Learning at the point of its acquisition from about $3 million to an IPO (initial public offering) several years later, and ultimately to more than $100 million in revenue, with a market cap of over $400 million. Things were really looking up for the company when you left in 2001. Why did you go? (Laughs) I got fired. At the time, the CEO had just stepped down, and there were two of us basically running the company underneath him. I was EVP of Sales, Marketing and Customer Service, while the other guy was the COO/CFO. He and I had very different ideas on how to run the company. We’d made 11 out of 12 previous quarters as a public company, our market cap went up 300 percent, and I got fired—and it ended up being the best thing that ever happened to me in my life. I had three young kids and I was traveling nonstop. It got me to reset in life and get the balance back. If I didn’t have that sort of wakeup call, then I might have finally realized, “I was not there.” But now my kids can say, “Dad was there. Dad was a part of our lives.” What did you do once you left PLATO? This was my “It’s a Wonderful Life” moment. I got asked to do due diligence on this emerging pre-revenue company, SwiftKnowledge. They had this really slick analytical way to help educators analyze student performance. They could pull data in from test scores,
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Business Person of the Year 2016
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from their student information system, from their health and wellness records, etc. They couldn’t afford to pay me, so they paid in stock. We met with these two big investment groups and did the pitch and they came back and said, “We’ll fund it on one condition: You stay and run it.” So I stayed on a CEO. It was slow going at first, but we were able to take that company from pre-revenue to one of the Minnesota Best 50 Growth companies. As I was working on selling that company, Bob and Jim Coughlan’s search firm contacted me about the opportunity to be CEO of Capstone. They were looking for someone who had both an education and a digital background. I said sure, I’d meet them. They felt that I was a good fit, but the sale of the company kept delaying. I finally got to the point where I knew I couldn’t delay any more and I just had to leap. So I did that in July of 2007. I would go to work in the morning to my old job, to make sure everything was all right, and then I’d go after work many days to my old job too, to get them ready for the acquisition. It was supposed to happen 3-4 weeks after I left, but that blew up and the company didn’t get sold for another year. Some people like to take downtime between jobs, but there was no downtime here. You said Bob and Jim wanted you—but why did you want to work for them? I wanted to get back into the content side of education. The interesting thing for me was that they were purely in print at that stage of the company’s development. At the time, 90 percent of their publishing business, Capstone, was to school librarians. But they wanted to be in high growth mode. I thought they had great content, and I saw real innovation and passion in the company. The Coughlans had cemented that as a cornerstone of the culture and the DNA of the company: innovation, passion and customer service. It wasn’t just the librarian customer but the ultimate customer, the child. “What’s going to motivate and really move the needle with the child?” We can really try to make a difference here. For the first number of years in the company, they were focused on engaging struggling, reluctant boy readers. They had great innovation around how to present
Digital Pioneer | Coughlan Companies
what might otherwise be, in other schoolbooks, really boring, whether it was science, social studies or math. When people thought of content that could really reach those struggling, reluctant boy readers, they thought of Capstone. Then it became those reluctant girl readers too, and then it broadened out to pre-K to middle school.
“What we saw was an opportunity to really evolve the content in a digital way, but at the same time we said, ‘Let’s protect the core.’” How did you begin turning to the digital side of things? The good news was that the people that were responsible for developing content were wonderful, great, passionate and innovative. They got everything done on time and on budget. The customers were saying great things about our innovation and customer service. So I thought, “Don’t screw that up.” Instead, we looked at how to approach getting our content in front of kids. Kids aren’t necessarily in the library. What we saw was an opportunity to really evolve the content in a digital way, but at the same time we said, “Let’s protect the core.” I’ve seen a lot of companies chase the shiny object, and they forget what got them there. We took a lot of initially lowcost experimentation approaches towards digitization. First, we tried moving some books into interactive audo CDs. And then we put them up on the web. Next, we believed there was an opportunity to create an online research database. We explored the market and determined that there was nothing for low-level readers, pre-K through third grade. We came up with this database called Pebble Go, and it just took off. I think we had 1,000 trials in the first month that we announced it. Now we’ve added five more additional databases and moved up in grade levels. This year, we’re launching a Spanish version. JANUARY/FEBRUARY 2016
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Tom Ahern | Business Person of the Year 2016: 1st Place
“It’s proven that if you can get a kid to read for 20 minutes a day, you’re going to see marked improvement in their reading scores. And we’re averaging about 21 minutes a session. Kids are getting in and staying in.” Next, I looked at the print content we’d developed. If it’s older than three or four years, even though the content is still viable, within a printed book, a librarian’s looking for something that’s more modern. So all of a sudden we have this huge investment that we’ve made into thousands and thousands of books that’s no longer generating much revenue. What we decided to do was take a bold, digital view of all our assets, asking, “How can we recreate ourselves in a digital way?” We needed to create a new entity that was going to be freed up from the preexisting mindset of how content gets into books and books get to customers.
most talented innovators and educators in the space. This team shaped the strategy to create a personalized reading platform for kids. We began a massive conversion effort and ultimately put thousands of books with audio read-alongs online. Working with a nationally recognized tool that measures reading levels, we were able to develop an appropriately leveled reading interest inventory for each reader and a customizable dashboard of books for every child. We called it myON. This is such a rich reading environment, and the child controls it. Each child can choose what to read, and that choice is a powerful motivator.
The result was your Capstone Digital Initiative—and the extremely successful myON program. How’d you come up with that? Today, to meet the needs of our readers and customers, we offer both a physical and a digital experience for almost everything we create, but at the time, this kind of thinking was new for the company. To help us evolve rapidly, we built a new team with some of the
Were you concerned about cannibalizing yourselves? I think we took this train of thought: If we’re going to be cannibalized, I’d rather be the one doing it. It might be a risk, but let’s go for it. We’re still selling print books to librarians, but we’ve gone from 100 percent of our business being on the printed side to more like 60 percent. By the end of 2016, we’ll probably be 50 percent digital subscrip-
tion and 50 percent print. The total digital business will be almost as big or even bigger than our historical print business was. How many kids are using your myON program now? We have more than six million kids enrolled on the system. We probably have, in any one day, about 250,000 on the system, and about half of the registered kids engage every month. We have huge usage in the evenings and weekends and in the summer. We want to be wherever the kids are, so we work on IOS, Android, any web application. The critical stat for me, in terms of success, is the average session time. It’s proven that if you can get a kid to read for 20 minutes a day, you’re going to see marked improvement in their reading scores. And we’re averaging about 21 minutes a session. Kids are getting in and staying in. MyOn is also getting recognition globally. We’re in Turkey and Colombia and other countries. Those countries are looking for ways to immerse their students in real English. We don’t use synthetic voice. We
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Digital Pioneer | Coughlan Companies
actually pay professional actors to come in and read the books. Between myON, PebbleGo and our Capstone Interactive books, we reached about 55 million visits in 2015. How do you come up with new content? We have this great content engine— almost 100 people participate. They keep cranking out new stuff. They look at trends and how standards evolve, like with Common Core. We do licensing arrangements with Warner Bros., the Smithsonian Institution and other organizations. We recently released a whole series of science books featuring none other than Wile E. Coyote learning forces in motion, magnetism and things like that. You can imagine all the maladies that befall him. We’ve become known for a series called You Choose, which gives you alternating ways to go through a story and have different endings. So if you’re in the Titanic, and you hear the alarm, do you blow it off and stay in your room or go up to the deck? We probably have 100 books with You Choose. Now our team is starting to do things that are digital first and then create print books for them afterwards. That was a real watershed mark we had in 2015. A lot of change is going on with how we do our jobs, but underneath it all, it’s that passion and innovation and ingenuity
that I know is the hallmark of the content that drives us. What challenges are facing Capstone at this time? We’ve had to weather some tough economic times. Schools aren’t funded very well. We are just now starting to get back to pre-2008 budgetary levels. I’d say the current levels of funding in schools makes for a tough growth environment. That’s a big issue. You have offices in Mankato, Minneapolis, Chicago and Oxford. The first three make sense, but why England? We made an acquisition of a company called Heinemann-Raintree from Pearson Education in 2008, and their offices were in Oxford. We saw that as a launching point to take our product into international markets. We probably have 30 some folks there. I think this company has really blossomed on a global scale. We’re looking at some other significant opportunities overseas, so we’ll see how those play out. Some industry experts say print is dying and everything will eventually be digital. Do you think that’s true? When I got here, everybody thought print was going away. I’ll never forget the first strategic plan I delivered to the board
Tom Ahern | Digital Pioneer
How Ahern Was Chosen In our September issue, we asked readers to nominate area business leaders for our annual Business Person of the Year award, based on the criteria of business results, personal character, leadership, and community involvement. After receiving nominations, we gathered information on each nominee. Minnesota State College of Business professors then selected the top three nominees for inclusion in our January issue.
THE ESSENTIALS
Coughlan Companies Phone: (507) 345-8100 Address: 1710 Roe Crest Drive North Mankato, MN 56003 Website: coughlancompanies.com
of directors. It included risks and opportunities. One risk was, “Are we scared enough?” Was print going to go away faster than we expected? But the other risk was, “Are we too scared?” I didn’t want to assume the sky was falling and see it be self-fulfilling. There’s definitely been a movement to digital, there’s no question. But I think the dramatic decline in print that many people would have predicted 6-7 years ago has not happened. You’re seeing it also on the trade side. EBook sales are starting to plateau. I also think, especially on our end, in children’s books, people like to have kids have that tactile book experience, especially for younger kids. But we’ve now successfully repositioned ourselves. Almost every printed book is also realeased as an interactive book and an eBook. At this junction, we’re format neutral. If the world wants to go to digital, they’ll still want to read our content. So it’s not really a factor for us. But we still have to listen to what they want and how they want it. What’s the future look like for Capstone? We have a third digital initiative that we’re piloting. Without revealing too much, the trend in education is a 1:1 device-to-student ratio, with many schools striving to have a device or computer for each student. They’re putting tablets into every child’s hands. What we’re finding, typically, in education is that they usually think hardware first, and then tackle, “Now what do you do with it?” We had all these smart boards that went into classrooms that a lot of times just became a glorified white board. We’re looking at ways we can help educators really lead personal instruction in a 1-to-1 environment. Meanwhile, serving the needs of schools that don’t take that 1:1 approach is just as important to us. So stay tuned. CONNECT Business Magazine
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A Look at Area Chamber Awards for Business of the Year Taking a cue from our annual Business Person of the Year award, we thought we’d look around southern Minnesota to see what other businesses are being recognized in their communities for exemplary success and community involvement. All the awards were presented in 2015, though some are classified as “2014” awards depending on how chambers of commerce title their award. NEW ULM
River Creek Nursery The New Ulm Area Chamber of Commerce has chosen an industry or business of the year since 1974, judging three categories: economic impact in New Ulm, years of business in New Ulm and community involvement in New Ulm. The winner for 2015 was River Creek Nursery, run by owners Tony Guggisberg and Kevin Schweiss. The partners started the business in 1995, offering residential and commercial landscaping, from planting trees to constructing retaining walls. Guggisberg also has represented the business on the New Ulm Business and Retail Association for more than 15 years, as well as leading the city’s Home & Health Show event every spring. “Every society, culture and community picks an ideal that represents or embodies the best of what they are,” said Audra Shaneman, executive director of the New Ulm Area Chamber. “Tony and Kevin are some of the ‘good guys.’ Tony has led the New Ulm Home & Health Show for years, consistently comes early to set up, brings his kids to help out and stays late to clean up. The two of them are busy as all get out!” 26
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Winnebago Manufacturing Company The Blue Earth Chamber of Commerce has honored businesses with the annual “Business of the Year” award since 1981. In 2015, the winner was Winnebago Manufacturing Company. Fred Hicks started Winnebago Manufacturing in 1950, calling it Hicks Repair. At the time, it was located in Winnebago and provided farm repair and blacksmith services. In 1957, the business was purchased by Cecil Jones, Ray Stifmer and Al Thisius, who changed the name to Winnebago Manufacturing Company. Winnebago Manufacturing moved to Blue Earth in 1987, and it changed ownership to Bob Preston and Daryle Pomranke in 1999. In 2012, Pomranke purchased Preston’s shares, becoming sole owner of the company. Winnebago Manufacturing has earned a stellar reputation and continues to grow, with sales of more than $9 million a year. “The Pomrankes have put their heart and soul into their business,” said Cindy Lyon, executive director of the Chamber. “In addition, they put their profits back into their business to make a better workplace for their qualified employees. They’re truly a giant in our eyes!” WASECA
Cinch Connectivity Solutions When it comes to the Waseca Chamber of Commerce’s Business of the Year award, the chamber takes several factors into account: the longevity of the business in the community, the business’s impact on its employees, the business’s success and the business’s impact on the community, among others. The winner for 2015 was Cinch Connectivity Solutions. Cinch Connectivity Solutions was part of the original E.F. Johnson business, which began manufacturing radio components in 1923. In 1996, Jordan Industries purchased the Johnson Components division of E.F.
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Johnson, selling it to Emerson Electric in 2000. Finally, Bel Fuse, Inc., Cinch Connectivity Solutions’ parent company, acquired it in 2014. Cinch Connectivity Solutions manufactures connectors and cable assemblies. These products are used in microwaves, radios, military applications, data networking and more. “Cinch Connectivity Solutions has long been a part of our community, with its roots dating back over 75 years as part of the original E.F. Johnson business,” said Chamber Director Kim Foels. “Throughout their growth and evolution over the years, the business never wavered on their commitment to the Waseca community through the support of youth, education, arts and sciences, health, safety and emergency relief efforts globally.” MANKATO
Community Bank and Tailwind Group Greater Mankato Growth has been giving awards to deserving businesses for decades. Awards are broken into different categories, such as inclusion into the Business Hall of Fame (for private sector businesses that have been in the Greater Mankato region for more than ten years). The Tailwind Group is a property development, management and leasing firm started by Kyle Smith, Landon Smith, Michael Sather and Reggie Reed. The four partners made headlines in 2013 when they started construction on the $15 million, seven-story Profinium Place building in downtown Mankato. (That’s in addition to a 60-unit student housing apartment complex in Rochester, retail projects in Owatonna, 65-house RentMSU, 114-bed College Town, two Waseca group homes and other projects.) Now, the company has between $50 million and $100 million in owned/managed real estate assets. Community Bank has been in the Mankato community since owner Quentin Beadell (who was also inducted into the Hall of Fame) started it in 1974, growing to four branches and 60 employees. The $250 million bank is one of the last family-owned
Complete Plumbing & Heating Services banks in the state and was the first in the community to offer free checking. “We’re very lucky to have two Hall of Fame inductees this year,” said Amy Linde, director of marketing and communications at GMG. “They both have been a staple in the community for a long time.”
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Kahler Automation (Large Business of the Year) and Sweet Financial Services (Small Business of the Year) The Fairmont Area Chamber of Commerce began its Business of the Year awards in 2015. Last year’s winners were Kahler Automation (in the 15+ employee category) and Sweet Financial Services (in the 15 and under employee category). Kahler Automation has been a staple in the Fairmont community since 1949, when Roy and Elvera Kahler founded Kahler Electric. Out of that company, Kahler Automation formed in 1989. Kahler Automation has become a regional leader in industrial control systems, designing systems for fertilizer, chemical and seed measuring. It’s been named on the INC 5000 list three years in a row as one of the 5,000 fastest growing companies, and Wayne Kahler was named Connect Business Magazine’s 2013 Business Person of the Year. In June 2015, a new generation took over operations when son Logan Kahler and daughter Chantill Kahler Royer assumed CEO and CFO duties, respectively. Sweet Financial Services was started in 1987 and works with clients on retirement planning, financial analysis and investment management, among other services. With more than 1,000 clients across the country and even worldwide, it has made a name for itself in the financial planning industry. It was founded by Bryan Sweet, who was named a runnerup for Connect Business Magazine’s BPOY award in 2010. He and his team have ranked in the Top 20 Minnesota and Top 1,000 U.S. wealth advisor rankings. JANUARY/FEBRUARY 2016
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BUSINESS TRENDS
CRIME
White collar criminal investigations have fallen to a 20-year low, according to the Star Tribune. Minnesota has also seen a downward trend in these prosecutions, which is good news for a state that has a relatively bad history in the world of white collar criminals. Its lowest point was a $3.65 billion Ponzi scheme created by Wayzata businessman Tom Petters, which was one of the largest schemes in U.S. history. Recently, federal prosecutors have un-
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According to Luger, one way to overcome declining resources is to create more partnerships among other agencies, such as the Minnesota Bureau of Criminal Apprehension (BCA) and the Minnesota Department of Commerce fraud division. covered a ring of thieves who specialized in stealing smartphones, several organized crime operations revolving around identity fraud, and 14 investment schemes in 2014. However, Andrew Luger, U.S. Attorney for the district of Minnesota, says white collar crimes are still a very real problem, so much so that he has asked for help from state and local law enforcement. In the Twin Cities, most cases are handled by the FBI, the Internal Revenue Service and the U.S. Postal Inspection Service. Federal agents in the Twin Cities say they’ve been limited lately by declining
JANUARY/FEBRUARY 2016
personnel, resulting in fewer resources to launch investigations. (Another problem is how long investigations can take—months or more—which prevents agents from starting new investigations.) The U.S. Postal Inspection Service has cut its agents in the Twin Cities office by 20 percent since 2010, while the number of IRS agents nationwide has declined 16 percent since 2011, probably affecting its Twin Cities office as well. Meanwhile at the FBI, spokesman Kyle Loven declined to release exact numbers of agents but said the number of agents working on white collar cases has
remained “relatively steadfast.” According to Luger, one way to overcome declining resources is to create more partnerships among other agencies, such as the Minnesota Bureau of Criminal Apprehension (BCA) and the Minnesota Department of Commerce fraud division. In addition, the Secret Service in Minnesota and the Dakotas has been working alongside investigators to offer help. However, since Secret Service staffing has shrunk across the country, those agents are sometimes pulled out to help with special assignments throughout the U.S., disrupting investigations. The state agencies have seen their own successes as well. The Minnesota Financial Crimes Task Force (made up of federal, state and local law enforcement) obtained 56 federal indictments in 2014, compared to only nine in 2013. Meanwhile, the Minnesota Department of Commerce recently reorganized its fraud bureau and hired more experienced investigators, according to Commissioner Mike Rothman.
LABOR
Labor force participation for prime-age American women has fallen behind Japan, Sweden, France and Greece, according to U.S. Economy. The news outlet reported that the share of U.S. women (aged 25-54) either working or looking for work has increased nearly 80 percent from the 1940s to the 2000s. However, since then, it has stayed around 73 percent, even as other countries’ rates have continued to improve. Slovenia and Sweden, for
example, have nearly 90 percent labor participation rates within that same age group. Some experts suggest that European labor participation rates are higher because of paid maternity leave and subsidized childcare. It’s not just American women who have troubling labor force participation rates, however. The overall workforce participation rate has fallen to the lowest level since 1977. In fact, of 34 countries tracked by the Organisation for Economic Cooperation and Development (OECD), only Italy and Israel have lower participation rates for prime-age men. Meanwhile, people aged 15-29 have problems of their own, according to the World Bank. Across the world, young people in this age range are at least twice as likely as older adults to be unemployed, with more than 75 million youth unemployed. The Bank went on to report that the world would have to create 600 million jobs over the next 10 years (or 5 million a month) just to prevent the situation from growing worse.
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The youth unemployment rate is projected to be 13.1 percent in 2016, compared to 4.5 percent for adults, according to the International Labor Organization. The ILO reported that employers across the world are not only interested in “hard skills” such as technical and academic proficiency but also “soft skills” such as showing up to work on time, being responsible and listening to constructive criticism. But this has presented a challenge, the ILO continued, since young workers are often lacking in these basic skills—or, while far overqualified in academics, missing the critical technical skills.
A 2013 study by American Express and Gen Y research firm Millennial Branding reported that managers have an overall negative view of young workers. A 2013 study by American Express and Gen Y research firm Millennial Branding reported that managers have an overall negative view of young workers, while a survey by York College of Pennsylvania’s Center for Professional Excellence showed that 40 percent of faculty believe less than half of students demonstrate professionalism. It isn’t just young people who are missing critical skills, though. According to a 2015 survey by Adecco, 92 percent of business leaders think Americans in general aren’t as skilled as they need to be, with 44 percent of Americans lacking soft skills such as critical thinking and collaboration. A majority of these business leaders (59 percent) put most of the blame on the U.S. educational system, with 54 percent saying that the system doesn’t teach the skills needed for today’s workforce. Going forward, 89 percent of them recommended corporate apprenticeships or training to help with workers’ skill gaps.
MANUFACTURING
Manufacturing jobs in Minnesota are growing at more than twice the rate of manufacturing jobs nationwide, according to the Minnesota Department of Employment and Economic Development (DEED). DEED reports that Minnesota’s manufacturing jobs were up 3.2 percent in 2015 compared to 2014, while the national rate only increased 1.4 percent throughout that period. The state has seen an even more
HOUSING
While foreclosure numbers have declined to about what was seen before the recession, bank repossessions have jumped 66 percent year over year in the third quarter of 2015, reports CNBC. This jump is the largest annual rise ever recorded in bank repossessions, according to RealtyTrac, a foreclosure sales and analytics company. The company reported that more than 123,000 homes were repossessed from July to September 2015. States such as New Jersey, Massachusetts and New York have been particularly
encouraging increase in these jobs—6.7 percent—from 2010 to 2014. Minnesota’s manufacturing industry employs about 311,900 people across the state—roughly 1 in 9 jobs. Within the $43.9 billion industry, food processing employs the most workers (with about 45,600 jobs), followed by computer and electronic product manufacturing (44,100 jobs), fabricated metal product manufacturing (42,500 jobs), machine manufacturing (32,300 jobs) and printing and related activities (24,000), according to DEED. Not only does manufacturing supply the most jobs across the state, it’s also the best paying industry, DEED reports, with the average salary for manufacturing jobs currently about $61,000 a year, compared to the average salary of $51,000 for all industries. DEED experts say that the manufacturing industry will most likely see a cutback in employment throughout the next decade,
since the demand for workers is so strong at this time. Right now, 66 percent of manufacturing openings are hard to fill, according to DEED data, with 70 percent of hard-to-fill positions attracting fewer than 10 applicants. However, only 14 percent of those cases were attributed exclusively to the lack of skilled applicants; rather, issues such as work ethic and interest played a role in hiring problems. DEED is helping with two programs to further strengthen Minnesota’s manufacturing industry: the Minnesota Job Scope Partnership and the STEP Grant program. The Job Scope Partnership is designed to form partnerships between businesses and training institutions to help businesses afford training for employees. The STEP Grant program provides funds for Minnesota companies to participate in trade shows, trade missions or traveling to meet with distributors in overseas markets, with the goal of expanding the industry’s exports into new areas.
hit hard by repossessions, according to RealtyTrac, partly because those states’ foreclosure timelines are some of the longest in the country, sometimes taking more than three years. Because of this, banks are finally reaching the repossession stage after years of work. In addition, more nonbank lenders are moving forward with foreclosures, now that the 6-12 month foreclosure moratorium has been passed. New Jersey has the nation’s top foreclosure rate, followed by Florida. In fact, New Jersey’s foreclosure rate is more than twice the national averawge. While the state is seeing a decrease in new foreclosures, bank repossessions increased 351 percent from a year ago. Formerly struggling states, such as Arizona and California, have seen a decrease in foreclosure activity, while states such as Michigan, Texas and Washington are experiencing average levels of foreclosure activity. Foreclosure proceedings usually spike between September and November, before holiday moratoria set in, reports CNBC.
(Banks often halt evictions throughout the month of December.) RealtyTrac reports that this increase is actually a good thing, showing that the foreclosure market has settled into a “normalized pattern.” Daren Blomquist, RealtyTrac’s vice president, added that the overall housing market should easily absorb the additional foreclosure activity with little impact on home values, which is always one of the main concerns when it comes to foreclosures and repossessions. In Minnesota, there has been a steep decline in foreclosure activity, with rates dropping to the lowest level since 2005, according to Minnesota Homeownership Center. The Center reported that only about 8,300 homes were foreclosed in 2014, a decrease of more than 29 percent from 2013. In fact, for the first time in a decade, no county in Minnesota had more than 1 percent of its residential parcels subject to a foreclosure sale in 2014. In addition, 64 percent of households seeking free foreclosure prevention services in 2014 were able to avoid foreclosure.
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By Grace Webb Photo by Kris Kathmann
Dotson Iron Castings might be a small foundry, but it has made a big name for itself in the metal industry—and a lot of the credit goes to Denny Dotson and Jean Bye.
Denny Dotson & Jean Bye Chairman & CEO of Dotson Iron Castings 2ND PLACE: BUSINESS PERSON OF THE YEAR 2016
When it comes to Mankato metal foundry Dotson Iron Castings, the secret to its success comes from a unique mix of Minnesota-nice values, cutting-edge innovation and two extremely talented leaders: chairman Denny Dotson and CEO Jean Bye. The foundry is described as “small,” with only 150 employees, but it has nonetheless managed to carve out quite a reputation throughout a history that stretches back to 1876. Early products included boilers, steam engines, tractors and road signs, while the foundry now focuses on ductile iron casting, machining, painting and heat treatment. More than 100 tons of ductile iron castings are melted every day, with 1,500 different castings produced for more than 150 customers across the world. Dotson and Bye arrived at the company at about the same time. You could say it was a match made in heaven: Dotson’s creativity perfectly complements Bye’s practicality. Together, they’ve managed to steer the company through growth spurts and hard times, always staying nimble, always pushing themselves to be better, always thinking about their customers and their employees. They say they’re in the “top five” in their industry—but that’s really a humble understatement. They’ve racked up countless awards, from the American Foundry Society’s Metal Caster of the Year in 2006 to Dotson’s induction into the Foundry Management & Technology Hall of Honor in 2010. Now they can add another win to that list: Runners-up for this year’s Business Person of the Year. continued > 32
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Business Person of The Year 2016 winners selected by MSU Mankato College of Business faculty.
16 R 20 EA
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16 R 20 EA
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2 nd P L A C E
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Denny Dotson and Jean Bye | Business Person of the Year 2016: 2nd Place
Still, Dotson had other plans once he graduated high school. He attended the University of Notre Dame to study business. While he was there, he started a student chapter of an international organization to locate jobs and summer internships for exchange students. Thanks to his involvement there, he was able to find an internship for himself in Holland, working at a steel company. By the time Denny Dotson was born, Dotson Iron Castings was already a force in the metal industry, under the helm of Dotson’s father, Jerry Dotson. But joining the family business was the farthest thing from Dotson’s mind. “I was absolutely not interested in working at the foundry,” he said. “Ending up there was a surprise to me.” Part of that resistance to dive into metal work was probably due to his experience at the foundry during high school, when he took a job there for the summer. Working 10-hr shifts, six days a week, he did just about everything, from pouring metal to making molds. “The first day we started at 5 a.m., and I was totally exhausted when I got home,” Dotson said. “I went right to sleep. I was absolutely certain I’d never come back. But I actually woke up on time the next morning, and I figured, ‘I may as well go in.’ And it turned out to be a marvelous experience. It gave me a real sense of not only the hard physical labor but also the camaraderie that exists among all the employees.” Still, Dotson had other plans once he graduated high school. He attended the University of Notre Dame to study business. While he was there, he started a student chapter of an international organization to
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locate jobs and summer internships for exchange students. Thanks to his involvement there, he was able to find an internship for himself in Holland, working at a steel company. After graduating in 1967, he continued on to the University of Chicago to earn his MBA. According to Dotson, the plan throughout college had always been to go into business, but his life took a detour after the Vietnam War escalated and he joined the Navy. He served for three years as a systems analyst, spending most of his time in Cleveland, Ohio. While he decided to move on once his service time was completed, he said he still learned valuable lessons from the Navy that he uses today. “What I really saw was how government worked,” he explained. “They all worked very hard, but in many cases, it was processing this stack of paper from here to there. They just kept hiring more and more people and didn’t stop and look at what was the added value. When Jean and I first came here, we were very similar to that. In the paper processing department, we had 28 people. Today, in all of those functions, we might have two. It took a long time for that process to move from 28 down to two. It was probably 10 years of continuous focus.” Dotson joined the foundry in 1972, explaining that he needed a job and his father offered him one.
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Iron Giants | Dotson Iron Castings
“It was less than I was making in the Navy, but I said, ‘Well, it’s better than nothing,’” he recalled. “So I came back, and I never regretted it.” Dotson worked with his father until 1978, when Jerry Dotson passed away and Dotson became CEO of the company. “In terms of training for being a CEO, my father was an excellent guide,” Dotson said. “He never told me what to do, and I really never asked him what to do. He allowed me to make my own mistakes. When I came to him one time and said that I decided that I had to fire one of our employees, the first one that I’d hired, he just looked at me and said, ‘I’ve been waiting for six months for you to say that.’ The lesson there is, if he’d told me earlier that I had to fire him, I would never have gotten to that point.” Another lesson Dotson learned? Patience. and Thursday that were not in that week’s schedule.” | Iron Denny Byeand Giants “We’ll get theDotson ordersand nextJean week, make them next week, and ship them next week,” Bye added. “About 20 percent of what we make isn’t in the schedule when we start the week.” Then came the 1990s, which brought a new problem: China. As more and more companies started sending business overseas, Dotson and Bye worked to find ways to compete with the industrial giant. “One of our taglines of that time was to get incredibly good at what the Chinese couldn’t or wouldn’t do,” Dotson said. “They were very good at taking the high run work and moving that because it was easy work and they were high volumes. Part of our getting incredibly good was at smaller quantities and getting faster turnaround time.” To help with this, they looked into more automation. The plant One reason Dotson Iron stands out at was already somewhat automated, butCastings it still wasn’t operating
Employee Engagement
among its competition is the way the employees are treated. “We as a company pay more per hour than any one of our competitors that we’ve heard of,” Dotson said. “We have more programs that are benefits to the employees. That’s a very hard thing to maintain, but it’s a large part because of Jean’s desire that we can have a real meaningful job here for our employees.” This commitment to employee care is noticeable throughout several programs, such as the company’s promise to pay at least 50 percent tuition for employees’ continued education. This education doesn’t have to connect to the job, either; Dotson Iron Castings has partly paid for an employee to earn a pilot’s license and for another to take baking classes. “If someone is out in a continual education mode and enhancing themselves, they’re excited about it,” Dotson explained. “And when they come back and engage with other employees, that enthusiasm is passed on. It’s contagious.” Another way the company cares for its employees is ensuring hours will never drop below a certain point, even if work is slow. Employees are never cut back to a three-day week, and they’re even
“My father was very patient, and I think that rubbed off,” he said. “For years, people remember me saying that I was much more concerned with direction than speed. It was important that you were going in the right direction. If you are going in the wrong direction, you lose ground so quickly. As I’ve gotten a bit older now, speed is a higher priority to me.” About the same time that Dotson became CEO, Bye joined him at the foundry. Like Dotson, Bye is a Mankato native, and, like Dotson, Bye also worked for the foundry in the summer during high school. She explained that it seemed like a more interesting job than the retail and food service jobs her friends were starting. “Even though my first jobs were exceedingly boring, spending summers typing 5-part carbon price lists, it still was probably
paid to volunteer around the community if they don’t have work at the foundry. “It’s important for us that our employees have options to maintain their paycheck,” Bye said. Employees also participate in the Dotson 100 Program, which encourages them to submit ideas for making work more efficient. Ideas have been as simple as color-coding identifiers for different metal types to creating a barcode to replace a cumbersome 6-digit load number. Every time the company hits 100 implemented ideas, everyone celebrates. “A lot of the best thinking comes from the people who are out on the floor doing the jobs all the time,” Bye said. “The goal is to draw that out.” The company makes further use of employees’ knowledge by including them in purchasing decisions through the $10,000 Program. If a piece of machinery is going to cost more than $10,000, a group of managers, maintenance workers and on-the-floor employees is sent to different distributers to study possible options. Employees have even been sent overseas to places such as Japan to look at equipment. “That’s what differentiates us from our competitors,” Bye said. “They’re not doing that, and they’re not gaining that positive power that comes from the knowledge of many.” Dotson Iron Castings recently formed an Employee Stock Option Plan, and employees already own 20 percent of the company. “Jean and I would be absolutely delighted if that was 100 percent of the company,” Dotson said. “We think that’d be incredibly good for the employees. It would be good for the community, and it’d be good for the company.” JANUARY/FEBRUARY 2016
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Denny Dotson and Jean Bye | Business Person of the Year 2016: 2nd Place
better than some of the other options,” she said. “Each summer, I got more interesting and challenging jobs. I didn’t plan on coming back to Mankato after college, but I came back in the summers during college and had some really fun, fascinating projects, like plotting out all the different parcels of land that Dotson owned.” Bye originally planned to go into early childhood education, but she enjoyed business so much that she ended up earning a degree in that instead, with an early childhood minor from Concordia College. She married her husband shortly after graduating, and she continued to work at Dotson Iron Castings while he looked for a job. She started as a human resource manager, and a temporary job became a permanent one. Within eight years, she had been promoted to vice president of administration, picking up an MBA from Minnesota State University, Mankato along the way. She also supervised operations, sales and engineering before becoming president of the company in 2010. Together, Dotson and Bye have weathered some intense storms and watched the metal industry evolve and expand. In the 1980s, the entire manufacturing industry took a hit as the economy fell. Dotson Iron Castings felt the pinch like any other foundry, with sales decreasing every quarter for a five-quarter period and bottoming out at an 80 percent decrease. It would take another 10 years for the company’s sales to equal what they had been in 1981. In addition,
Denny Dotson and Jean Bye | Iron Giants
Getting to know you:
Getting to know you:
Jean Bye
Denny Dotson
Family: husband Tim; children Becci, Dan and Tom; grandkids Camden, Wesley and Gemma; a Golden Retriever and a miniature Goldendoodle.
Family: wife Carole; kids Kelly, Tammy, Andrew and Alyssa; five grandkids
Education: MBA from Concordia College (1979), MBA from Minnesota State University, Mankato (1987)
Education: BBA from the University of Notre Dame (1967), MBA in math methods from the University of Chicago (1968) Hobbies: traveling, mentoring young professionals
Community involvement: Board member of the Ductile Iron Society, board member of the Mankato Area YMCA, board member (and future president) of the American Foundry Society, board member of the Minnesota Safety Council
Community involvement: Mankato Area Foundation, chairman of People Driven Performance, chair of the National Institute of Science and Technology Manufacturing Extension Partnership advisory board, United States representative to the World Foundry Organization, past president of the American Foundry Society, past trustee of Minnesota State Colleges and Universities.
How Dotson would describe her: persistent, focused, great multitasker, employee-oriented
How Bye would describe him: creative, caring, energetic, intelligent
Hobbies: spending time with grandkids, traveling, cooking, reading.
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Denny Dotson and Jean Bye | Iron Giants
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Iron Giants | Dotson Iron Castings
“Our focus has always been to push the company,” Dotson said. “In the past, we had tried to look at this from a manufacturing standpoint, and the manufacturing people always had a reason why it wouldn’t work.” Denny Dotson and Jean Bye | Iron Giants
Spectacular Failures Dotson and Bye are both quick to note the value of failures as learning experiences, with Dotson adding that most of the company’s failures come from being too patient and not moving quickly enough. “A spectacular failure might be taking down a major customer’s production line because you don’t have parts there that they need,” Bye said. “Twenty years ago, that happened. Now, we just don’t let customers’ lines down. Every employee out there knows that if something comes up where a customer’s line is going to go down, it’s not going to happen. We say, ‘Not us.’” To ensure breakdowns like that don’t happen, Dotson Iron Castings has gotten very good at recovery, even sending an employee to Wisconsin in the middle of the night with parts to make sure the customer’s production line would be able to function the next morning. If there’s a quality issue, employees are on site by 8 a.m. the next morning to figure out what went wrong and how to fix it. “This is to make sure our customers know that if they buy from us, we are always going to have their back,” Bye said. “If you overreact in those instances, you start having fewer of them. You come back and you error proof.”
the foundry shrunk from 425 employees to 87 within six months. Dotson made the news during this period by asking workers to take 40 percent pay cuts, which he promised to repay with interest. It was a bold move, but it worked. He and Bye also worked to trim down operation costs, closing the brass and aluminum foundry, steel foundry and machine shop in 1983, as well as discontinuing a line of trip hammers. Next, they turned their attention to new melting and molding equipment, the first of many equipment purchases and expansions over the years (with the latest $5 million equipment and building expansion occurring in 2012). These efforts were enough to save the company from the edge of bankruptcy and cement Dotson Iron Castings as a major player in a time when other foundries were falling by the wayside. Just as important, though, the whole process taught Dotson about the need for constant change and reinvention. “For change, you need an outside source,” he said. “It’s hard to drive real change within any organization without having an outside
Denny Dotson and Jean Bye | Iron Giants
Jobs and Automation While some experts have estimated that nearly half of America’s jobs will be automated within 20 years, Dotson and Bye believe that automation doesn’t necessarily mean companies will be laying people off. Instead, they believe jobs will be built around new automation technologies. “The jobs are going to change,” Dotson said. “When Jean and I started, an employee would come and basically say, ‘I own this machine.’ Today, to be successful, there’s variety on the job. Pretty much none of the jobs that we’re doing today existed even 10 years ago, and what we’re doing today won’t exist 10 years from now.” Bye pointed out that, since starting to seriously automate equipment in the 1980s, Dotson Iron Castings has never seen a decrease in employees. And, while companies across the Midwest are struggling to find skilled workers, Dotson Iron Castings doesn’t have that problem. “We’re very willing to take people that are just good, hardworking people and train them in what they need to be,” Bye said. “We can do the training. We’re just happy to have good people in the Midwest.” JANUARY/FEBRUARY 2016
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Denny Dotson and Jean Bye | Business Person of the Year 2016: 2nd Place
THE ESSENTIALS
Dotson Iron Castings Phone: (507) 345-5018 Address: 200 W Rock Street Mankato, Minnesota Website: dotson.com
push. When things are going along semigood, it’s hard to create the energy to get off of that inertia. Change is difficult. In this company, we’ve probably reinvented ourselves five different times. There are some companies that, in 40 years, haven’t reinvented the company at all; there are some that have reinvented the company once or twice. But I’m not sure that there’s any that have done it five times. Part of that is changing the driving force. What is it that you’re trying to do? At one time, the focus was on how many tons of product we could get from every labor hour, and today we don’t even think about that. Now, the real focus is on agility. When we start up on Monday, we will make and ship products on Wednesday and Thursday that were not in that week’s schedule.” “We’ll get the orders next week, and make them next week, and ship them next week,” Bye added. “About 20 percent of what we make isn’t in the schedule when we start the week.”
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Then came the 1990s, which brought a new problem: China. As more and more companies started sending business overseas, Dotson and Bye worked to find ways to compete with the industrial giant. “One of our taglines of that time was to get incredibly good at what the Chinese couldn’t or wouldn’t do,” Dotson said. “They were very good at taking the high run work and moving that because it was easy work and they were high volumes. Part of our getting incredibly good was at smaller quantities and getting faster turnaround time.” To help with this, they looked into more automation. The plant was already somewhat automated, but it still wasn’t operating at the high levels Dotson and Bye wanted. At their best, they had an 85 percent ontime delivery rate, which was far higher than most competitors but still not as high as Dotson and Bye wanted to be. They also had about two months worth of inventory stored at the plant, while rejections from customers were about 50,000-60,000 parts per million. “We were on the good side of industry, but I think both Jean and I looked around and said, ‘That’s not where we have to be,’” Dotson said. “Our focus has always been to push the company. In the past, we had tried to look at this from a manufacturing standpoint, and the manufacturing people
JANUARY/FEBRUARY 2016
always had a reason why it wouldn’t work.” That was where Bye came in, taking over operations and bringing in a customer focus that went against conventional industry wisdom. Bye managed to increase their on-time delivery rate to between 98 percent (“when we’re bad”) and 100 percent. Product lead time was trimmed from 10-12 weeks to nine days at the longest, and the plant now only holds about 3-4 days worth of inventory. The foundry has also improved the quality of its operations so much that it is among the best in the industry when it comes to how many parts are sent back by customers. “It’s made, it goes on a truck, it’s gone,” Bye said. In 2010, Dotson and Bye faced another major change for the company when Dotson became chairman of Dotson Iron Castings and handed the position of CEO off to Bye. “There are different phases that a company goes through,” Dotson explained. “There’s an entrepreneur phase where the manager is controlling absolutely everything. I think my father and his staff were in that. Then there’s the manager-driven phase, which I led. We could say yes to anything, and it was fun saying yes because those were challenges. But it was obvious that if we were in the process of our continual reinvention, we needed to move to a different style of management. Jean’s real strength is in the
Iron Giants | Dotson Iron Castings
process-driven end of it. That starts with listening to the customer and acknowledging that you need to say what you won’t do as much as what you will do. You’ll never get 99 percent and above on-time delivery or a nine-day lead time in a manager-driven company. It’s absolutely impossible.” As chairman, Dotson’s only official responsibility is meeting with Bye’s leadership team once every quarter—but he is still pretty involved in the company. He added that, after years of using Bye as a sounding board, he now has the chance to return the favor. “Denny’s exceedingly creative,” Bye said. “Usually when I bring him a question, he doesn’t give me one answer; he gives me four possibilities. So now I have choices. And they’re choices I never would have thought of.” For Bye, creating clear processes and constantly re-evaluating them is the key to keeping the company running efficiently. “If you’re all over doing a bunch of different things for a bunch of different customers, without the systems and processes to support them, you drop a lot of balls,” she said. “And then you get frustrated with the employees, when it has nothing to do with them. Instead, you have to understand the processes. If something fails, you look at the process and say, ‘What’s wrong in our process?’” The industry is still changing. While the number of foundries has decreased, the overall industry has been globalized along with many other markets. Dotson Iron Castings uses equipment purchased from places such as Japan, Italy and Germany, along with raw materials from China, Brazil, Norway and Canada. The company has also created strong global connections, such as its major partnership with Sintokogio, a Japanese company that is the world’s largest supplier of foundry equipment. Because of this connection, Dotson is the only nonautomative iron foundry in North America with 100 percent auto pouring. Things are also becoming increasingly more digital, which Bye said will enable the company to be even quicker and more agile in its response to its customers. Dotson agreed, adding, “There is so much
information that exists in a manufacturing world because all the equipment is automatic and it’s all run by small computers. We can now get information off of it instantly. Even as a small company, we’re looking at the world of big data. Using instant feedback on the data becomes very important.” Another technology that has the potential to completely reshape the world
of manufacturing is the 3D printer, which Dotson Iron Castings already uses for prototyping. “The Additive Manufacturing will potentially be a game changer,” Bye said. “We need to anticipate how that market’s going to develop and be able to be on the leading edge of it without tripping and falling too hard.”
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GRACE NOTES
College kids may have gotten a bad rap recently, in the wake of campus protests and demands for things like safe spaces and trigger warnings. Heck, the whole Millennial generation has been on the receiving end of some pretty negative news articles and opinion pieces lately, with young people called everything from “overly sensitive” to “spoiled.” But in southern Minnesota, there are some pretty great young people doing some pretty great things—including in the business world. In late November, the Minnesota State University, Mankato College of Business celebrated “Global Entrepreneurship” week. Throughout the week, several events were hosted, from a Women in Entrepreneurship brunch to a fashion show featuring a student-created business. I had the chance to attend two of these events, and I found it both exciting and inspiring to see what MSU students are doing and creating in the world of business— even before they earn a degree. The first event I attended was the Big Ideas Challenge 2016 Kick-Off at Mankato Brewery. The Big Ideas Challenge was launched in 2014, with student teams competing to win $10,000 in startup money for a business idea. The money came from MSU alumnus Craig Lloyd, who repeated his donation for this year’s competition as well. “It’s our ‘Shark Tank’ at the university,” explained COB Dean Brenda Flannery at the brewery event. “The first time, we weren’t sure what to expect, but the students involved really exceeded our expectations.” Participating students had to create a business plan, submit a video pitch and appear before a panel of judges to present their business idea. They didn’t necessarily have to be business majors, either; in fact, last year’s winners were two nursing stu40
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Her plan now is to take the idea to different campuses, licensing the Dream Closet model and finding corporate sponsorships along the way. That’s pretty darn impressive for someone who’s not even a year out of college. dents, Katie McDonald and Megan Chase. The two women created Mankato Pediatric Respite, which offers respite care for families with medically fragile children. McDonald and Chase are still running the company today, even though they’ve since graduated and found nursing jobs in the Twin Cities. While McDonald and Chase took home the grand prize, several other competitors still moved forward with their own business plans, which included a company to help international students enroll in high-quality American universities and a same-day delivery service utilizing quadricopters. April Femrite, an Entrepreneurship and Innovation Fellow with the COB, encouraged students to Grace A. Webb Editor apply, stressing that they didn’t need to have a multi-million dollar business empire planned out. “A big idea means starting anything that is new, innovative and valuable that serves an unmet need,” she said. That idea carried into the Women in Entrepreneurship brunch the next day, where Kylen Feltes, a 2015 MSU graduate, spoke about becoming an entrepreneur at a young age. Feltes is the founder and CEO of Dream Closet, which collects gently used clothes and hosts free “shopping” days throughout the year. She began the business while at MSU and continues to run it today. At the brunch, she spoke candidly about how intimidating it can be to take a risk on an idea, and how much she values failures as learning experiences. I had a chance to catch up with Feltes in December to learn more about her story— and it’s pretty impressive. Feltes told me her business sprang out of an idea she had while trying on clothes in her dorm room. After realizing that
JANUARY/FEBRUARY 2016
she didn’t wear many of the clothes, she gathered them together to donate to the YWCA. When that didn’t work out, Feltes decided to collect more clothes and host her own event where people could come take whatever they needed. “That’s how entrepreneurs think,” she explained. “They see a need, and they think about ways to fill it.” That first event, held in December 2013, included 17 tables and two hanging racks full of clothes—which were all gone within half an hour. Since then, the business has only gotten bigger and better. Feltes handed off the MSU Dream Closet to her leadership team when she graduated, though she’s still the business’s executive director. Her plan now is to take the idea to different campuses, licensing the Dream Closet model and finding corporate sponsorships along the way. That’s pretty darn impressive for someone who’s not even a year out of college. There were many other events throughout the week, too many for me to attend, but I feel like I at least got a taste of what the College of Business is offering its students— and I am thoroughly impressed. These kids are younger than I am, yet some of them are already running businesses, dealing with payroll, figuring out insurance and so much more. And the College of Business is there for them every step of the way, providing support, steering them to resources like the Small Business Development Center and helping turn brilliant ideas into reality. I also had a chance in the past few months to become better acquainted with groups of young professionals across our region, interviewing members of the New Ulm, Greater Mankato Growth and Sleepy Eye Young Professionals. These groups offer young people the chance to create professional networks, build their skill sets and become more involved in their communities. Events include everything from mentorship lunches to business tours to specialized speakers. That’s great for the members—but it’s also
great for the southern Minneosta region as a whole. As cities and states struggle to retain workers—especially young workers—groups like the Young Professionals offer skilled young workers incentives to set down roots in their communities. Just take a look at some of their members’ comments: “It’s a great way to make those connections and be involved in something other than just going to work every day.” (Kayla Ruch, New Ulm HYPE.) “As young professionals, we’re really working together to build up our community and the organizations we belong to.” (Mikayla Mage, Sleepy Eye Young Professionals.) “I probably would not have expanded my network as much as what I did without being in YP for seven years. I can’t say enough good things about the program.” (Nathan Hanel, GMG Young Professionals.) When it comes to these groups, many businesses fund their employees’ memberships and offer them time off to attend events. I think that’s an excellent idea. It may be a couple hundred dollars a year, but the benefits those businesses receive, such as employees’ growing leadership abilities and strengthened loyalty to their company, are priceless. Not only that, the entire region sees economic development. Anything business owners can do to enhance their employees’ professional and personal lives is well worth the investment. We need young leaders and entrepreneurs, and I’m convinced that southern Minnesota’s supply won’t dry up any time soon.
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BULLETIN BOARD
Any chamber of commerce, convention and visitors bureau, or economic development organization in our reading area—large or small, from Amboy to Winnebago— can post on our free bulletin board. For details, email editor@connectbiz.com.
Blue Earth Cindy Lyon, Blue Earth Chamber/CVB
Gaylord Amy Newsom, Economic Development Authority
We made giant steps with our new building fundraiser and have made some sweet connections for 2016! We had 26 new chamber members join our team for 2015-2016! We are at 153 for our membership! We signed on our new board members for the 2016-2018 term and will be installing them during our business meeting at our 75th Annual Banquet, awarding our Business of the Year & Community Service honorees on Jan. 15!
The Gaylord EDA is excited for the upcoming construction of the new elementary school and future housing in Gaylord. The newly formed Housing Task Force is working to bring needed housing to Gaylord. The city recently signed a letter of intent with 4-Square Holdings to develop housing in Meadow Wood and Mud Lake. Meadow Wood is comprised of 20 lots and is located near the new Sibley East Elementary School. Construction of the new school will begin in April 2016.
Fairmont Linsey Preuss, Economic Development Center
Henderson Jeff Steinborn, Henderson Chamber
The City of Fairmont was recently awarded a $32,950 grant from the Southern Minnesota Initiative Foundation to jumpstart our Brain Gain Project. This innovative project is a collaboration of a number of private and public sector organizations to increase economic activity and stabilize and grow our regional workforce by attracting those who have grown up and moved away to return to Martin County to live, work and raise their families.
Gaylord Amy Newsom, Gaylord Chamber January is the time to join the Gaylord Area Chamber of Commerce! The Chamber sponsors many community activities and promotes local businesses through their “think local first” campaign. Sponsored events include the Business Recognition Program, Gaylord Royal Ambassa-
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dors, Spring Business Celebration, Easter Egg Hunt, Farmers Market, Music on Main, EGGSTRAVAGANZA Celebration, Chamber Sweepstakes, Citywide Photo Contest, Teacher Welcome & Appreciation, Ghosts ’n’ Goblins in Gaylord and Santa Day. To join, please contact Amy at anewsom@exploregaylord.org or 507-237-2338.
Henderson welcomes its first motorcycle repair shop, Henderson Cycle Works, along with a cycle apparel store, Henderson RoadWear. Ridgeview Medical Center is now offering full-time clinic hours in Henderson. The Henderson Lions Club winter bingo begins January 7 at the Henderson Event Center. The Henderson Preservation Commission will begin installing historic signs to mark its local historic district. More historical sights have been added to the “Discover Henderson” mobile app. For more information, visit www.hendersonmn.com.
Lake Crystal Julie Reed, Lake Crystal Chamber Join the Crystal Waters Project and the Lake Crystal Loon Rec. Association on January 30 for the 3rd Annual Ice Fishing Extravaganza. The contest will take place at the Robinson Park Boat Landing,
Region Nine
Sleepy Eye
Nicole Griensewic Mickelson, Development Commission
Kurk Kramer, Sleepy Eye EDA
Don’t be one of the 37 percent of small businesses that haven’t claimed their local search listing! Join Region Nine at the Social Media Breakfast-New Ulm event, Local Search: How To Turn Google Searches Into Business Leads, and learn how to improve the appearance of your business on Google. This free event is on Jan. 29 from 7:30-8:30 a.m. at the Best Western Plus in New Ulm. Learn more and register at smbnewulm.org.
The City of Sleepy Eye has engaged a committee to study the planning of a new Community Event Center. The committee is considering plans for an event center that could seat more than 600 people and would be available for weddings, banquets, dances and other events. Considerations that are being made in these planning sessions include size, design and location of the facility. The new facility will replace the Orchid Inn, which has served for years as the event center for Sleepy Eye.
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Local Chamber & Economic Development News
with door prizes, raffles, concessions and a $500 cash prize for Top Fish Caught. Proceeds from this event will go towards water quality improvement efforts and projects for the Lake Crystal watershed. Interested volunteers can contact Mike at (507) 380-1794.
Mankato Julie Nelson, Small Business Development Center The new year is an ideal time to assess your business. Do you need to revisit your business plan or marketing plan, become more efficient, better manage your cash flow, clean up QuickBooks, reassess your online brand or get financing to expand? The SBDC can help to position you for success in the coming 12 months. As always, our services are no-cost and strictly confidential. Call us at (507) 389-8875 or apply for services at myminnesotabusiness.com.
New Ulm Sarah Warmka, New Ulm CVB The New Ulm Area Chamber of Commerce invites the public to attend these upcoming events: Bock Fest/Fasching on Feb. 6; Women’s Networking Event on Feb. 25; the Farm Show on March 11-12; St. Patrick’s Day Parade on March 17; the Prairie Peacemakers Quilt Show on March 18-19; the Home Show on April 1-3; and Spring Boutique Week on April 13-16. For more information or to be a vendor, please check the event listing at www.newulm.com.
Nicollet Alesia Slater, Nicollet Chamber Happy New Year from the Nicollet Chamber of Commerce. Membership Drive is in full swing. If you or your business would like to be part of the Nicollet Chamber of Commerce, please email the Chamber of Commerce at chamber@nicollet.org. Continue to follow nicollet.org for this year’s upcoming Chamber events.
St. Peter Ed Lee, St. Peter Chamber The St. Peter community welcomes HD Digital Marketing, along with The Refinery, to the business scene. St. Peter celebrated the beginning to the holiday season by hosting the Snowflake Celebration, and the Chamber of Commerce continues to encourage everyone to shop in the Norman Rockwellesque downtown atmosphere. The Chamber looks forward to Winterfest 2016, Polar Bear Plunge, Fishing Contest and other events.
Waseca Gary Sandholm, Waseca EDA The City of Waseca will supply BEST (Business & Entrepreneurial Support Team) of Waseca County with personnel support. Danny Lenz will provide executive support, Mary Buenzow will assist with meeting details, and Gary Sandholm will be the point of contact for BEST programming and research for the entire county. Call (507) 833-9281 for help. Roger Ashland, retired manager of Birds Eye, will assist with the Small Business Development Center and SCORE programs for businesses and entrepreneurs.
Waseca Kim Foels, Waseca Area Chamber The Waseca Area Chamber of Commerce and Ambassadors will host the annual Community Awards event on Jan. 30 at the Starfire Event Center. The chamber is recognizing Bill Jensen of Mediacom as 2015 Boss of the Year and the Waseca Public Schools PTO for the Community Development award. Many other awards, such as Distinguished Agricultural Leadership, Rotary Service Above Self, Exchange Club’s Book of Golden Deeds and Distinguished Young Professional will also be announced that evening. Check out www.wasecachamber.com for more information on business and a calendar of events.
Mankato
Wells
Jonathan Zierdt, Greater Mankato Growth
Emily Hassing, Wells Area Chamber
Register today to join us on March 30 for the seventh consecutive Greater Mankato at the Capitol. A delegation of business and community leaders from Greater Mankato will travel to St. Paul to raise the visibility of our region among state leaders. The event allows attendees to be advocates on their own behalf as well as speak with a unified voice on key policy issues that allow our region to grow and thrive. For more information, visit greatermankato.com/capitol.
The annual Wells Area Chamber’s Vegas Night fundraiser was held on Nov. 6 with the best turnout to date. This is the second year this event has been open to the public, and it continues to grow to be a fun and enjoyable event for the community. The annual Winter Social will be Jan. 13, thanking our current Chamber members with a meal catered by Lacey’s Catering along with some entertainment for the evening. We welcome those interested in joining or learning more about our Chamber of Commerce.
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By Carlienne A. Frisch Photo by Kris Kathmann
Sleepy Eye Branch President of SouthPoint Financial Credit Union 3RD PLACE: BUSINESS PERSON OF THE YEAR 2016
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As Sleepy Eye Branch President of SouthPoint Federal Credit Union, Jill Berdan serves her community through her passion for financial literacy.
Titles aren’t all that important to Jill Berdan. Berdan is the Sleepy Eye Branch President of SouthPoint Federal Credit Union, but she sums her job up a little more informally: “I’m supposed to get out into the community, build relationships, and find ways to fulfill needs and to drive businesses back to SPFCU.” Since Berdan, now 47, joined SPFCU in 2005, she has been instrumental in helping to grow the credit union from two branches to four; 7,950 members to 14,200; and $140 million in assets to $290 million. Berdan views both her job and her community involvement as simply doing what needs to be done. “My parents were always doing things for others, helping with snow removal, fixing things, making baked goods that we would deliver,” she explained. “My passion is financial literacy, helping people to succeed with their finances now and in the future.” That passion has fueled far-reaching results and built such a solid reputation within Berdan’s community that, when it came time to collect nominations for Connect’s 2016 Business Person of the Year, everyone from coworkers to nonprofit heads rushed to recommend her. That community support, along with Berdan’s impressive business presence, earned her the title of second runner-up for this year’s award. Titles might not mean much to Jill Berdan, but she should be mighty proud of this one. She deserves it. continued >
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Business Person of The Year 2016 winners selected by MSU Mankato College of Business faculty.
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Jill Berdan | Business Person of The Year 2016: 3rd Place
Berdan’s first professional success came at age 16, when she convinced the owner of a family-owned women’s clothing shop in her hometown of Hutchinson that she would be an asset to the business. “I applied, but was not hired because they thought I was too young for the job,” she said. “Most of their customers were professionals or more mature women. They hired someone else, but when I saw the ‘Help Wanted’ sign back in the window, I phoned the owner from a pay phone at school. I got an interview and landed a 30-day trial period. The summer after my senior year, I was working at their new store in St. Paul and supervising nights and weekends. The day before my 21st birthday, we opened a store in Edina. I wanted to own my own store someday.” While working in St. Paul, Berdan attended the University of St. Thomas, majoring in sales and marketing. She cut back to parttime classes to gain the real-life experience of managing the Edina store. Then her life took a new direction. She left the clothing
Berdan has been described as “thinking outside the box” and “always willing to stand up for what she believes is right for the customer.” business, returned to Hutchinson and took a job as a Land O’ Lakes district administrative assistant. “I was burnt out,” she said. “Retail is fun, but exhausting—nights, weekends, holidays.” Her interest in sales led to a real estate career. She received her real estate (CRS, GRI) license in 1995, shortly before she married her husband, Jeff, whom she met through Land O’ Lakes. “I so loved the sales,” she said, “but my husband was also in sales, which was fine before we started a family, but made for a scheduling nightmare after we had two children. So I was a stay-at-home mom for
four years, which I loved doing.” An offer from a lender with whom she’d worked in real estate led to a return to the job market at a New Ulm mortgage company. “For that job I took a four-week mortgage lending course in Atlanta,” Berdan said. “It was my husband’s turn to be the full-time parent. I still use the information I learned.” When the mortgage company closed after one year, Berdan was hired by SPFCU as a Financial Services Representative, opening accounts and making loans. She was promoted to FSR supervisor and then to Sleepy Eye Branch Manager. She recently earned a Financial Educator Certificate
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through a one-year University of Minnesota Extension program and has joined other credit union colleagues in community development training and initiatives. “We put a huge emphasis on education at SPFCU,” Berdan said. “My goal in taking the U-M Extension online program was to be lined up with what other financial educators are doing. I learned about resources for specific issues, interactive budget sheets (so I don’t have to develop them from scratch), and why people manage their finances the way they do.” Berdan has been described as “thinking outside the box” and “always willing to stand up for what she believes is right for the customer.” It’s those qualities that helped her take on what she termed one of the credit union’s “biggest challenges.” The Sleepy Eye branch is located in an aging community with an already high rate of membership, which led to a decrease of members through attrition. The program she created to reverse that process is one of her “outside the box” ideas. “A credit union is built on thrift, savings and education,” Berdan said. “Education is huge. What do employers want? Employers want productive employees. When employees are stressed, they are less productive, and most stress is caused by finances. With a team of co-workers, I developed a program called SouthPoint @ Work. It’s a way to approach area employers about helping their employees through financial education.” Berdan explained that SouthPoint partners with employers by offering seminars at their workplaces. These seminars address various topics that could impact finances, such as budgeting, identity theft, mortgage loans, investments and how to improve a credit score. Some employers incorporate SouthPoint @ Work into their wellness program. “I don’t know of any other financial institution that does anything like this,” Berdan continued. “We develop a relationship and develop trust.” Since the program SouthPoint @ Work began, the Sleepy Eye branch has grown by two members per week—about 100 new members over the past year. The education process continues after new members join. “We never just deny a loan,” Berdan said. “We tell the member, ‘I know the answer I will give you today is not what you want to
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Jill Berdan | Business Person of The Year 2016: 3rd Place
hear.’ Then we explain what’s affecting our decision, and what can be done about it to obtain that type of loan in the future. It’s the right thing to do. We don’t make a loan to someone who cannot be successful with it. We have the knowledge of how to improve a credit score, and we share that knowledge with them.” “People helping people” is a credit union philosophy, but for Berdan, it’s also living out the philosophy of treating others with the same respect you give family members. This applies even more to credit union members who may have health or mental conditions such as early dementia issues. “It may be difficult to deal with them,” Berdan said. “We tell our staff, ‘This could be your mom or dad. How would you want them to be treated?’ We may need to adjust our relationship to connect with that member as an individual.” Credit unions are unlike other financial institutions in that the members are part owners. According to Berdan, the credit union’s profits are returned to members in fewer fees, lower loan rates and higher interest rates on deposits. “We are committed to helping people every time we interact with them,” she said. “What we do is not just transaction based anymore.” Berdan also has helped develop and launch other SPFCU programs, including Growth and Giving, Retail Financing and Community Partners, as well as EzSkills Workshops for high school juniors and seniors. With the Retail Financing Program, merchants with credit union memberships can allow customers to use SouthPoint Visa Credit Cards for purchases that will then retain zero percent interest for six months. “It’s a great way to partner with our retail business members,” Berdan said. “It encourages shoppers to buy from that merchant, deepens our relationship with our members and encourages potential new members to consider SPFCU. Another benefit to the merchant is there is no cost to them and no risk.” Another program, Community Partners, offers member businesses free advertising on the SPFCU website. A Community Partner business is featured monthly on the main page, and participants may link their website to the credit union’s. Through the Growth and Giving program, SPFCU donates $10 to the school (within the field of membership) of every new credit union member’s choice. SPFCU also supports having staff go into schools to share their knowledge. Having been a guest speaker in high school classrooms, Berdan recently launched the EzSkills Workshop, a program she developed from an idea she saw on a webinar. “We pay high school juniors and seniors $25 to attend the EzSkills Workshop to learn how to successfully manage their own finances,” Berdan said. “EzSkills is another way we can use information to build relationships and trust, and hopefully to grow membership. We want the students and their parents to think of SouthPoint when they are looking for someone to trust now and in the years to come.” One trend affecting credit unions is more online interaction, such as being able to apply for and sign a loan online. Berdan sees that as a great convenience to members, but also as a challenge to be met. “We build relationships,” she said. “Hopefully, we are still building them by giving members the tools they need, the products and services they want, and providing advice they need or expect. If I could change one thing, it would be to have the opportunity to 48
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“People helping people” is a credit union philosophy, but for Berdan, it’s also living out the philosophy of treating others with the same respect you give family members. interact with every one of our 15,000 members in seven counties, even though I know that will not happen.” Berdan’s community leadership and volunteer involvement are also important parts of her life. Having served on the Sleepy Eye Chamber Board of Directors for five years, she currently is the vice president and twice was emcee for the annual Chamber meeting, as well as emceeing events for other community organizations. She takes part in events ranging from Music in the Park to Buttered Corn Days to golf tournaments. Six years ago, this was not the case. It took a small push to propel Berdan into community action. She explained, “Although I live in New Ulm, I’ve worked in Sleepy Eye since 2005. It was five years ago that SouthPoint’s CEO told me, ‘Jill, it’s your turn to serve on the Chamber Board.’ My first thought was, ‘But I have all of this work to do.’ I had not yet been
Jill Berdan | 1 In A Million
Berdan Basics Childhood: Fourth of five girls in Hutchinson, the youngest for 13 years until the baby came along. Family: Husband Jeff, sons E.J. and Ian Hobbies: Baking, sewing, scrapbooking, four-wheeling through the river bluffs. (“I used to want to be a race car driver.”) Accomplishment of which most proud? “Landing that first job at 16.” Three words that describe you? “Committed, involved, service oriented.” If you weren’t in this business? “It would have to be something with sales and service. That’s what fuels me.”
1 In A Million | SouthPoint Federal Credit Union
integrated into the Sleepy Eye business community. The Chamber of Commerce did that for me. I’ve met so many wonderful people, and there are so many things to do. It makes me sad that I can do only some of them and that a board member can serve only two three-year terms.” Three years ago, Berdan helped launch a B2B (business-to-business) quarterly networking luncheon for Sleepy Eye Chamber members,
Jill Berdan | 1 In A Million
SouthPoint History In the depths of the Depression, St. Mary’s Church of Sleepy Eye, seeking a place to save and borrow money at reasonable interest rates, formed the St. Mary’s Parish Sleepy Eye Credit Union on April 21, 1936. Membership was originally limited to parish members, their immediate families and associations of such members. Two years later, membership was expanded to members of the Japanese Martyrs Church of Leavenworth (a small community southwest of Sleepy Eye). In 1965, membership was extended to all parish members in the New Ulm Diocese who resided in Brown County. In 2002, all residents and legal entities of Brown, Redwood and Renville counties were added. The name remained unchanged until 1970, when it was modified slightly to St. Mary’s Parish Credit Union. In 2002, the National Credit Union Administration approved the application to convert from a state to a federal charter, causing the name change to St. Mary’s Federal Credit Union. On September 15, 2005, the name was changed to SouthPoint Federal Credit Union, to better suit the expanding field of membership. SPFCU now serves seven counties in southwestern and south central Minnesota through branches in Sleepy Eye, New Ulm, Springfield and St. Peter.
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Jill Berdan | Business Person of The Year 2016: 3rd Place
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inviting non-Chamber members in hopes they would see a benefit in Chamber membership. Membership has grown by 22 percent since B2B began. In addition, the Springfield Chamber of Commerce started hosting its own B2B events after sending some members to Sleepy Eye’s event. “It’s not my brainchild,” Berdan said. “The Chamber board discussed how to get Chamber members better acquainted with one another and what they are doing at their business and in the community. The first time there were only eight people at the networking lunch. Now, 50 to 60 show up each time to hear people speak about what’s going on in their business. Some businesses bring five or six people. We’re talking Sleepy Eye (a community of fewer than 5,000 people).” Berdan also serves on a Chamber committee focused on finding ways to encourage young people to stay in Sleepy Eye.
“In a small town, kids tend to grow up and leave,” Berdan said. “We want them to know they can have the jobs and careers that they are seeking elsewhere right here in their small town.” To do this, the committee developed an “On the Job” training program in the Sleepy Eye high schools. Students interested in OJT apply, interview and attend a training session that includes topics such as how to brand yourself, social media image, appropriate apparel for work and even handshakes. Students are “hired” (without pay), shadowing an employee or doing real work, depending on the business, during a class period. Students can explore banking, sales, accounting and other areas. Some of these “jobs’’ have led to full-time employment. Berdan also is an integral part of the Sleepy Eye Junior Achievement Committee, which includes helping raise funds to support JA
Jill Berdan | 1 In A Million
What Others Say “I am extremely impressed by Jill’s passion for the success of our business, members and the broader communities we serve. Her positive and passionate approach makes her an extremely effective communicator, coach and leader.” -Jay Gostonczik, Vice President of Member Services “Jill is a standup person who is passionate about supporting her local community. She makes an excellent example to all in the business world.” –Kayla Ruch, Junior Achievement District Manager “Jill has been an advocate for our organization in regards to financial education. Her passion for our mission in regards to helping our members achieve their goals and dreams is her focus.” –Maxine Meine, Branch President of SouthPoint Federal Credit Union “Whichever group Jill commits her energies to, you always know that she will roll up her sleeves and become part of the solution. She is a model of the person that all of us would like to be. She genuinely cares about others on both a personal and business basis… If we had more people like Jill Berdan, our community would be just that much more successful and positive!” –Julie Anderson, Mathiowetz Construction Company
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classes in the Sleepy Eye schools. “I began teaching Junior Achievement when my children were in elementary school,” she said. “I have taught 4th-grade JA at both St. Mary’s School in Sleepy Eye and in the New Ulm Area Catholic Schools. The public schools also have volunteers.” Berdan received the Shining Star Community Service Award from the Sleepy Eye Chamber last February. The person who receives the award is described as a positive role model, one who generates inspiration to others and demonstrates how civic engagement contributes to a healthy environment and successful society. Last September, Berdan was recognized for her dedication and distinguished service to education and to the community by being inducted into the New Ulm Area Catholic Schools Hall of Fame. In addition to being involved in NUACS’s Junior Achievement program, she has sewn and directed the costuming for New Ulm Cathedral High School’s theater productions for several years. She’s also involved in community fundraising events, serves as volunteer on the Catholic school’s accreditation committee and serves as a Eucharistic minister at the Cathedral of the Holy Trinity. “A lot of what I do fills my bucket,” Berdan said. “I get more out of work and volunteering than I give. My job is challenging in that I am tasked with growing the membership base of the SPFCU main branch, which has been in business since 1936 and serves 75 percent of the households in our community in some fashion. By implementing some unique strategies, we have seen growth that we didn’t previously think was possible. I am excited to see what the next few years have in store for us as we continue down this path.”
Together let’s start planning for your family’s future. Judy Ringler Mountain, LUTCF, CLTC Agent New York Life Insurance Company 931 Madison Ave Ste 1 Mankato, MN 56001 (507) 387-4262 jrmountain@ft.newyorklife.com www.jrmountain.nyagents.com Registered Representatives offering investments through NYLIFE Securities LLC (Member FINRA/ SIPC), A Licensed Insurance Agency.
Life Insurance. Retirement. Investments. SMRU1614160(Exp.08/07/2016) © 2015 New York Life Insurance Company, 51 Madison Avenue, New York, NY 10010
Carlienne A. Frisch writes from Mankato.
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Connecting With Young Professionals If you read the news headlines, things are looking rather bleak for the next generation of workers and entrepreneurs. There’s a workforce shortage slamming businesses across the country, and workforce participation levels are historically low. Business owners lament their inability to find qualified workers, while young graduates lament their inability to find well-paying jobs. But across southern Minnesota, things are looking pretty good. Young workers in the nine-county region (Blue Earth, Brown, Faribault, Le Sueur, Martin, Nicollet, Sibley, Waseca and Watonwan counties) aged 20-24 have a labor force participation rate of 81 percent, while workers 25-44 are even more engaged, at 89 percent. Both numbers are far higher than the region’s overall rate of 69 percent. Clearly, the young people of southern Minnesota are diving into the workforce and growing into the leaders of tomorrow. There are no doubt several reasons for this, but one clearly stands out: the strong networking groups available to young professionals across southern Minnesota. Usually
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Grace A. Webb Editor
called “Young Professionals” groups, these organizations allow Minnesota’s youngest generation of workers to gather together, network, develop professionally and become engaged in their community. New Ulm HYPE New Ulm has had a Young Professionals group called HYPE (Helping Young Professionals Evolve) since 2010 when New Ulm Area Chamber of Commerce Executive Director Audra Shaneman approached a group of young professionals about starting something. Since then, the Chamber has continued to support HYPE, though the group plans its own schedule and events. While the official kickoff only included four people, HYPE has now grown to more than 45 paid members and a six-person leadership team. The group isn’t limited to New Ulm, either; there are members from Nicollet, Sleepy Eye, Courtland and other surrounding cities. “You don’t have to live or work in New Ulm,” said vice chair Jessica Staddick. “You just have to want to be a part of this community. [HYPE] helps members meet new people and make new friends, and we’ve got so many great speakers and relevant topics to our age group.” “I think that employers definitely encourage new employees to be part of the group, especially new employees that recently moved to the area, because it’s a great way to make those connections and be involved in something other than just going to work every day,” added Kayla Ruch, past chair of the group. Staddick said the group hosts two events
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every month. The first is a luncheon with a guest speaker. Topics have ranged from work/life balance to insurance to health. The second is “Topics on Tap,” an informal get-together where members discuss current issues. There are also other special events, such as business tours and the annual “Welcome to the Party” event in February, which is a networking event intended to introduce New Ulm residents and workers to each other in a casual atmosphere. “We try to bring in unique things that we think our age group will be interested in,” Staddick said. Rachel Smith, current chair of the group, said they are also trying to become more service-oriented. Members recently partnered with Thrivent to create comfort care bags for cancer patients at the New Ulm Medical Center, and they have also volunteered with Junior Achievement of the Upper Midwest. To become a HYPE member, a one-time fee of $20 is required. To learn more, visit the group’s website at www.newulm.com/ chamber-of-commerce/hype/, check out the Facebook page “New Ulm YP” or email nuyoungprofessionals@gmail.com. Sleepy Eye Young Professionals The Sleepy Eye Young Professionals group is probably the newest in southern Minnesota, having started in early 2015. According to Trista Barka, executive director of the Sleepy Eye Chamber of Commerce, the Chamber came up with the idea of forming a Young Professionals group in an effort to attract and retain young workers in the Sleepy Eye area. “We’ve been very blessed to have a number of individuals who grew up in the area and decided to come back to town to work,” she said. “We saw as a Chamber that there was a critical need to make sure those young people felt committed and involved in Sleepy Eye. The goal of the group is to empower members with a voice in business and community, educate members to better their careers, and engage members to cultivate a future in the Sleepy Eye area.” Five Chamber members formed a YP committee, focusing on three areas: volunteering, forming relationships, and professional and personal development. The group already has 58 members, with dozens more prospective members that the
committee is working to recruit. “We’re fairly new in the game, so people are excited about the group because it’s something new and different,” Barka said. “The next step will be to keep that momentum going.” Barka said members have expressed the most interest in professional and personal development, as well as volunteering, so that’s where the committee is focusing right now. So far, the group has been meeting quarterly, though there are occasionally special events. The official kickoff was in May 2015, and there was a networking picnic in the summer. In November, the group invited a presenter to lead a “True Colors” workshop, which focused on figuring out what kind of personality each member had
and how to best interact with other people. “I was amazed to see how many people showed up,” said Mikayla Mages, a member of the Sleepy Eye Young Professionals Committee. “Sometimes it can take a while for new groups to take flight, but ours took off from the get-go.” Mages is a Sleepy Eye native who moved away for college but returned and found a job at the Sleepy Eye Medical Center. She said the Young Professionals group has helped her establish professional relationships and grow in her own skills—but the best part, is how it has helped her become more deeply involved in her community. “As young professionals, we’re really working together to build up our community and the organizations we belong to,” she said. “Sometimes it can be difficult to take the first step, especially if that step is outside our own comfort zone, but in this case I think it’s a step worth taking.” Barka said the committee hasn’t planned out the 2016 events yet, though she does hope to organize a networking event with another area Young Professionals group. To join the Sleepy Eye Young Professionals, members must be Sleepy Eye’s group featured a workshop on discovering 20-40 years old, live or work in member personality types and how to interact with others.
Sleepy Eye and pay an annual fee of $20. For more information, visit the group’s Facebook page, “Sleepy Eye Young Professionals,” call the Chamber at (507) 794-4731 or email Barka at chamberdir@sleepyeyetel.net. Mankato Young Professionals Mankato has one of the largest and most active Young Professionals groups in southern Minnesota—and perhaps the state. Since it was formed in 2008, it’s attracted 208 members from 117 member companies, and the numbers only continue to grow. According to Greater Mankato Growth Executive Director Jonathan Zierdt, the idea to form a group of young professionals in the community came up as early as the inception of Greater Mankato Growth itself. “At the time, organizations like ours weren’t spending that much time thinking about talent: talent development, talent retention, talent attraction,” he explained. “We need to have an intentional, deliberate way to attract talent, retain it and engage it in the community. The focus on the Millennials is a critical issue to us as an organization. It’s important enough to say we want to dedicate organizational resources towards that audience because they’re important to our businesses and our community.” By the end of 2008, the YP organization had about 80 members. Within three years, the number had grown to about
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100. At that point, Zierdt said, GMG conducted a survey to see how many Young Professionals were still working for their original employers. The answer was about 80 percent of the 100 members. He added that when you estimate companies lose $50,000 per every employee who decides to take another job, that means Mankato companies saved $4 million by retaining those 80 YP members. As the group grew in members, it also started offering more events. Nathan Hanel, 2015 chair of the Mankato YP and a member since 2008, said the group originally focused on three aspects: professional development, social engagement and community service. However, since many of the YP members were already active in their own volunteer efforts, the group eventually decided to focus on the first two aspects. One of the most popular offerings is the mentorship program offered twice yearly. Area professionals are asked to mentor groups of YP members. Eight YP members will meet with a mentor for a casual lunch once a month, meeting different mentors throughout a four-month period. Hanel said the group tries to offer other professional development and social engagement events once a month, from bringing in a speaker to organizing a trip to the theater. Members can also tour local businesses,
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and the leadership committee recently started “YP Wednesdays,” occasional get-togethers at different eateries within the area. These dinners are casual and open to non-members as well. All in all, members can attend about 40-50 events every year. While Greater Mankato Growth funds the Young Professionals group and helps implement some of the members’ ideas, the Young Professionals are responsible for GMG Young Professionals members are able to tour local choosing and planning their events. businesses throughout the year. “The direction of what the Young “Are we keeping people from being a part Professionals experience comes of the Young Professionals? No, we’re just from themselves,” Zierdt said. “There is no saying you need to be a member of our board that’s going to tell them what should organization,” he said. be in the social agenda or the professional For Hanel, joining the group through his development agenda. The members decide employer was definitely worth it. what inspires them and allows them to get “I’ve met a lot of great people, and it’s engaged in the community.” been such a great experience for me,” he While other Young Professionals groups said. “I probably would not have expanded across southern Minnesota are open to any my network as much as what I did without young professional, the Mankato group being in the YPs for seven years. I can’t say requires that members be employed by a enough good things about the program.” business that is a GMG member at a certain To learn more about Mankato’s Young level of membership. Zierdt explained Professionals group, visit its website at www. that the reason for this was because of greatermankato.com/greater-mankatothe substantial resources GMG commits young-professionals, its Facebook page “Greatto the group and the fact that GMG is a er Mankato Young Professionals” or contact membership-based organization that offers Shannon Gullickson at (507) 385-6656. exclusive benefits to its members.
JANUARY/FEBRUARY 2016
CONNECTING BACK
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5 YEARS AGO
JANUARY/FEBRUARY 2011 Our 2011 Business Person of the Year was John Roise, owner of 150-employee, $15 million Lindsay Window and Door of North Mankato. Led by his strong faith, Roise was well known throughout the community for giving people second chances, hiring more than 350 convicted criminals to work for him. Business Person of the Year runnersup: Warren P. Smith (Survey Services, Mankato) and Darwin Anthony (Farmers State Bank, Trimont). Memorable quote from Roise about hiring felons: “Except for the grace of God, I could be one of them. These are good people who made bad decisions who also happen to need work. I believe we have an obligation as businesspeople to give people another chance to learn a good work ethic and discipline.” 10 YEARS AGO
JANUARY/FEBRUARY 2006
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Business Person of the Year 2006 was Winnebago’s Bob Weerts, owner of Blue Valley Sod and many other businesses. Runners-up were Dennis Miller (Midwest Wireless, Mankato) and Bob Coughlan (Coughlan Companies, Mankato). Memorable quote from Weerts: “Sometimes I joke around to help me figure out a person. You can tell a person’s personality if you let them joke with you. If you don’t like a person, you won’t joke with them.” 15 YEARS AGO
JANUARY/FEBRUARY 2001 Our cover story featured Madison Lake native Bill Bresnan of Bresnan Communications. Profiled companies included the Fairmont Opera House in Fairmont and Winco in Le Center. 20 YEARS AGO
JANUARY/FEBRUARY 1996 Profiled companies were Sign Pro in Mankato and Door Engineering and Manufacturing in Kasota. CONNECT Business Magazine
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Calling All Paws Jillian Cousins grew up around animals, so it’s no surprise she has managed to take those experiences and create a successful business. Cousins was raised on her grandparents’ Arabian horse farm and grew up helping prepare the horses for the show ring. When she was 15, she became a bather and brusher at Pet Expo, and she continued in that line of work at Madison Avenue Pet Grooming. “Shaving down a 12-lb Shih Tzu is nothing compared to shaving down a 1,200-lb horse,” she said. Cousins opened her own home studio in 2002 and ran it until 2004, but then she became the grooming salon manager at Petco in 2007. While she enjoyed working there, she said she longed to have her own studio again, since that allowed her more one-on-one time with clients. After she became a national certified master groomer (the only in southern Minnesota) through the National Dog Groomers Association of America, she decided to open another studio. Cousins said business is already bustling, since many of her Petco clients followed her to her studio. She works both with dogs and cats, offering full service baths and grooming, as well as “peticures,” dental work, spa treatments and facials. She suggests bringing in pets for a trim every 6-8 weeks. Cousins independently contracts with another groomer and said there is room for two more groomers at her studio. She added that she hopes to someday open a grooming
school to pass on her knowledge. “We forge a lot of relationships with the pet and the owner,” she said. “I want those pet parents to know they can trust me that their little furry family members are in good hands.” In her spare time, she cares for her own pets: her Dachshund, her cat, her parrot and her fish. CALLING ALL PAWS Website: 402 Hope Street, Suite 1 Telephone: (507) 388-7297 Facebook: Calling All Paws
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Jumping from a two-decade career at 3M to running a restaurant may seem unusual to most people, but Mike Bode said that was always his dream. “I always wanted to have a restaurant,” Bode said. “I’m probably the happiest I’ve been in the last seven years.” Bode was born in Nicollet but grew up in New Ulm. Besides working for 3M for 23 years, he also bartended at Turner Hall (where he was also on the board of directors) and the B&L Bar. All the while, though, he kept his eye out for opportunities to start his own restaurant—and something finally came along in March 2015. Bode named the restaurant “Lakes on 1st” after his grandson, Laken. The official grand opening was in October, but Bode has been serving meals at the restaurant since July. The restaurant serves breakfast, lunch and dinner, with a menu that isn’t expansive but includes enough choices to offer variety—from ten different types of Paninis to homemade noodle soup, with the “Gobbler” (a turkey Panini with smoked bacon, cheese and granny smith apples) being one of the most popular orders. In addition, customers can request specials on the restaurant’s Facebook page, and Bode will work some of the suggestions into that week’s menu. Bode’s daughter works alongside him as manager, and his wife also works at the restaurant part-time, along with eight
other part-time workers. Bode said he hopes to someday be able to expand his restaurant into a larger building, but that will be far down the line. “Right now, we say we’re ‘small on seating, big on flavor,’” he said, adding that the current building seats 28. “Come over and see us! You’ll be pleasantly surprised.” LAKES ON 1ST Address: 512 1st North Street Telephone: (507) 354-0306 Facebook: Lakes on 1st
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Very New or Re-formed Businesses or Professionals New To Our Reading Area
Generations Boutique For years, 21-year-old Chelsie Salonek has dreamed of opening her own boutique. She even had a dream location picked out along Minnesota Ave in St. Peter, which she often passed during shopping trips to the Twin Cities. In June of 2015, that dream became a reality—even down to that same storefront. Salonek grew up in New Ulm, attending New Ulm Public Schools before heading to Minnesota West Community & Technical College to earn an associate’s degree in dental assisting. However, her goal always was to open her own business. In February 2015, she saw that the building she liked in St. Peter was open for leasing. “The opportunity came and I jumped on it,” she said. “I’ve always been into fashion and wanted my own boutique. It all just came together.” Salonek officially opened Generations Boutique in June of 2015. Right now she commutes from New Ulm, but she hopes to move closer to St. Peter soon. She buys most of her apparel through online vendors and apparel markets, stocking her shelves with clothes, shoes, purses and accessories. Currently, she runs the boutique by herself, but she said she does hope to hire help in the near future. In addition, she said she hopes to expand locations and offer more styles.
Salonek acknowledged that running her own business is a challenge, but it’s worth it. “It keeps me busy, but I love it,” she said. “I love fashion, and fashion is always changing. I try to offer reasonable prices and good quality. I want to keep things affordable for everyone to be able to enjoy fashion like I do.” GENERATIONS BOUTIQUE Address: 326 S Minnesota Ave Telephone: (507) 934-7407 Website: generationsboutiquemn.com Facebook: Generations Boutique
To be considered for one of three spots in the March Hot Startz!, email the editor at editor@connectbiz.com. Businesses considered must have started—or changed greatly in form—within one year of our publishing date. Professionals chosen must be new to our reading area.
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Health insurance costs are on the rise and employers are on the lookout for costeffective ways to offer health benefits to their employees. One such way to achieve this goal is through the use of a private exchange and defined contribution health plans. Through these versatile means, employers can define the overall amount they would like to utilize for their plan and then let employees decide what works best for them, whether it is using the contribution towards insurance premiums and/or pre-tax accounts. Two Plan Types There are two different types of defined contribution health plans: group plans and individual plans. Defined Contribution Group Plans allow employees to shop around for health insurance plans due to an underlying group plan that is usually offered though a single health insurance carrier. Defined Contribution Individual Plans allow employees to purchase individual policies that are usually offered through a single or multiple health care providers. These two options are typically easier for employers to set up than traditional defined benefit health plans, because rather than making a “one-size-fits-all” decision on the plan that would best fit most of the employees, the employer simply chooses a fixed dollar amount that the employee can use as he/she sees fit. Defined contribution
Are Defined Contribution Health Plans Right for Your Company? health plans also help employers project a more accurate employee benefits budget, as well as offer potential FICA savings and simplify the annual renewal process. One Caution It is important for employers to note that defined contribution individual plans do not qualify as sponsoring a health plan, so if the employer has 50 or more full time equivalent employees, they will be subject to the “pay or play” penalties under the Affordable Care Act. Private Exchanges Offer More Options Defined contribution health plans are also beneficial for employees since the selection tools used by the private exchanges can help employees compare insurance costs and better understand their benefit options. There are even options for employees to utilize subsidized health coverage through the public exchanges, such as MNSure, as well as unsubsidized coverage. Employees who use a private exchange can also take advantage of pre-tax accounts such as a Health Savings Account (HSA) and a limited Flexible Spending Account (FSA), and they are able to cash out the remaining dollars post-tax. These options provide a wider variety of benefit plans for employees, and allow them to take a
more direct role in selecting the options that work best for them. Although this option could subject the employer to the “pay or play” penalties, many companies have found the savings in insurance costs outweigh the potential penalties. If an employer chooses to sponsor a defined contribution group plan, benefits can be pre-taxed and include health, dental and vision insurance. In certain situations, out-of-pocket expenses can also be pre-taxed through the use of an HSA or an FSA. Determine The Best Choice For You There are a variety of ways in which employers can provide health benefits to employees without breaking the bank, and there are many things employers should consider when deciding which route to take. Determining the best option may take some comparing and contrasting of items such as rates, employer penalties and projected employee subsidies. Eide Bailly offers a variety of services that can help make this determination for your business. Through our employee benefit plan consulting services, as well as our health care reform analytics tool, health care reform consulting, and our assistance in the completion of necessary forms related to the Affordable Care Act, we have helped countless businesses make informed decisions. For more information, visit www.eidebailly.com.
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