Utah CEO - July 2009 by MediaNews Group Targeted Products

Insurance

Wellness

Legislation

Preventive Care Health Care

HEALING THE

HEART $4.95 U.S.

UtahCEOmagazine.com

July 2009

OF HEALTH CARE PLUS: Jumping the GAAP into IFRS The stimulus and COBRA Arts and culture need your support CFO for hire

PRST STD US POSTAGE PAID SLC UTAH PERMIT NO. 6563

Still waiting for advice from your accounting firm?

Does it feel like you’re not getting technical advice from your accounting firm in a timely manner? Perhaps you should talk with Grant Thornton LLP. Easy access to technical advisors and hands-on partner attention have been the hallmark of Grant Thornton in the U.S. for more than 80 years. Plus, you get the benefit of Grant Thornton firms in more than 100 countries. Give Gordy Haycock, Salt Lake City Office Managing Partner, a call at 801.415.1050, or contact us at GrantThornton.com. Find out how it feels to work with people who love what they do! Grant Thornton LLP is the U.S. member firm of Grant Thornton International Ltd.

2009UTAH100 Honoring Utah’s Brightest Companies

Applications are now being accepted for the 2009 MWCN Utah 100 Awards. honored at the 15th Annual Awards Luncheon, being held at the Grand America Hotel in Salt Lake City, on October 23, 2009. There will be honorees selected in the categories of 100 Fastest Growing Companies, 15 Largest Revenue Growth Companies and 15 Emerging Elite Companies.

Established 15 years ago as Utah’s premier Business Growth Recognition Program

The deadline for submitting applications is July 21, 2009. at www.mwcn.org. Interested companies can call 801.966.1430 or email to info@mwcn.org for additional information. 2009 MWCN Utah 100 Sponsors: Ballard Spahr Andrews & Ingersoll, LLP CBIZ Deloitte Durham Jones & Pinegar Grant Thornton LLP Holme Roberts & Owen, LLP Jones Waldo KUED/KUER MARSH/MERCER

Merrill Corporation MonaVie Parsons Behle & Latimer PricewaterhouseCoopers LLP Stoel Rives LLP Tanner LC Utah CEO Zions Bank

A team approach to cancer. A better chance of returning to life.

Cancer patients at Intermountain Healthcare get a whole team of experts helping them. That leads to the most appropriate treatments for each individual, and more people returning to life. If you or a loved one has cancer, visit healingforlife.com.

Cancer Services

Intermountain Medical Center • Primary Children’s Medical Center • LDS Hospital • McKay-Dee Hospital Center • Logan Regional Hospital Utah Valley Regional Medical Center • American Fork Hospital • Dixie Regional Medical Center • Valley View Medical Center

A privately held company making local decisions. Pacific Office Automation offers the industry’s leading office products and services including full line digital copiers with production print, wide format, printer services and document management.

Call for a free demo or complimentary client needs analysis.

801•990•4001 www.PaciﬁcOfﬁce.com

july 09 | vol. 3 no. 7

features >>

FEATURE

UTAH CEO CASE STUDY

The economic recession and volatile business

HEALTHY WORKSITES Driving for A RISING TIDE LIFTS Digital Dollars

environment have sent health care costs skyward, forcing Weighing options businesses to look for new methods to keep costs under Once you commit, the hard work When the United States Olympic basketball The effects of the Stimulus Bill on the health care control. It isn’t easy, especially because recent legislative begins — deciding where to advertise team, made up mostly of NBA stars, plays Spain industry come under five separate provisions of the bill: actions on both the federal and state levels are changing the you should know online, what your ads will look like and in an international tournament, they play by Research on the comparative effectiveness of health care healthRESOURCES coverage landscapeFOR as well.EMPLOYERS It becomes increasingly what they will do. There are dozens of international rules, which in some ways are quite treatment and services, extending the reach of HIPAA, the complicated for employers trying to keep health care costs Utah of Health offers a and options — banner ads, wallpaper ads, different from NBA rules. For instance, there are downThe while still Department providing a quality health benefi t plan Health Information Technology for Economic and Clinical 1. Ad rotation — The rotation of number of resources to help employers adhering to regulations. listings, video, run-of-site, registration, variances in at least 15 major rules categories, Health Act (HITECH Act), Medicare System provisions, and ads based on a predefined list. This promote better employee health. Linda Havlin, global intellectual capital leader for Flash animation and featured placement are including the shape and size of the lane, playing Medicaid provisions. is done by using software or by a site by Thad Kelling Mercer Health & Benefits, a global consulting, outsourcing administrator. Ads sometimes rotate just a few of them. time, goaltending, traveling and fouls. When NBA “The most immediate impact [of the Stimulus] to OF has HEALTH throughout a network of websites. andDEPARTMENT investment firm, foundWORKSITE that healthTOOLKIT costs in previous Rollings likes to start his online players steps. and coaches prepare employers is theand increased number of potential COBRAdealers areUTAH Start with a site map when creating a Keep a tight schedule “We really try for to international think throughevents everything so we are not discovering Utah’s auto fiHow nding success with to start a worksite health identify recessions were elevated by program, stress-related illnesses and laidAnticipating the of IFRS, the SEC new adoption website. Consider it a road map for chart your progress. Consider ad campaigns by asking a number of suchthings as thein Olympics, a portion ofsays their training participants,” says Ann Thomas, principal in Mercer’s Salt the programming,” Christy Whitehouse, who manages the Summit aggressive online advertising. Here’s how target areas and improve areasto of use concern. development of your site. listed Without on one, Internet browser capability, user behavior and off workers that continued benefits while they were already allowstheforeign companies 2. Affiliate marketing — When a questions: Who are we marketing to? involves learning the new rules Planning and how the to play Group’s interactive division. website required four key phases: outlining Lake ce. “In response, employers’ strategies to mitigate Create a wireframe showing the layout and you will be lost — especially if your site has security, among many otheroffi considerations. health.utah.gov/worksitewellness/pdfs/Worksite_Toolkit.pdf website sells products or services for still covered. Her surveys found that immediately following American exchanges to make the switch from they do pending it and what you should know. functionality of your website. focus on how many pages. You could work on a costs websitewill forever if you on what options remain Why is there traffic on the website being objectives, building a sitemap, creating wireframes and sketching out possible looks effectively by them. depend viable another company, known as the affiliate. that spike, however, costs declined as employers enacted GAAP. each element will operate. Will there be a drop- don’t set deadlines. for the site. (Amazon.com runs one of the world’s considered? How will the vendor place our proposed legislation.” Rob Tweed, clinical director for Davis down menu? Will you be able to rate videos? HEART CHECK measures, like shifting costs to employees, and cost-cutting largest affiliate marketing services.) America First decided that its objective was to build a following among young ads? Who will create the ads? Imagine the following scenarios: Surgical Center in Layton, notes that electronic recordsAssessing worksite support a heart-healthy most expect to bring thefor 2010 increase inlifestyle. health care cost Stepping toward the inevitable switch to IFRS, the SEC has adults. This proved to be tricky, Whitehouse explains. This demographic tends to be To help answer these questions, keeping provisioned in HITECH will require an initial cost www.health.state.ny.us/nysdoh/heart/healthy/heartcheck.pdf down to 5.2 percent, the lowest increase since 1997, according since November 2007 let foreign companies listed on American techU.S. savvy especially in Utah their standards are high. They are typically averse 3. Click-stream — The path a Rollings focuses on demographics. Website mystery will 1. The and—Spanish teams play—bysodifferent for switchover, hardware and software,It’s butno afterwards by using Brian Staker Financial to Mercer. But that‘s just a temporary fix for a problem that exchanges report their financial results International viewer follows when viewing a website. to advertising. And they want to be part of the conversation instead of being lectured. more consumers online, rules within the same game. For instance, the INSURANCE EVALUATION is steadily worsening. Compared to just nine years ago, the It’s almost a secret:and theisNorthwestern save money, a measure hisBand companyAswas planning to get information Reporting Standards (IFRS). Before that time, such companies had It’s almost a secret: the Northwestern Bandtraffic tends to be more fragmented than Statistics allow administrators to track The solution: a social-networking site where young bank employees can interact with where viewers come from and in what Centers for Disease Control andpaying Prevention checklist health care amount Utah employers for employee resources into online are U.S. has to shoot three-pointers from itsThfamiliar to reconcile whatever standard they reported incutting to that ofmeasures, U.S. like shifting costs to employees, and most implement anyway. e economic recession and volatile business of the Shoshone Nation is located in Brigham more businesses are sinking additional of the Shoshone Nation is located in Brigham traditional media, so it’s important to customers and customers-to-be. order they view the website’s pages. analyze insurance benefits cost concerning has increased 100 percent. “Simple shiftingheart won’t be the Generally Accepted Accounting Principles (U.S.expect GAAP). to In effect, is how best toyour attract netizens 23 feet 9 inches, while with Spainlaunching can shoot from 20 have sent bring the 2010 increase in health care cost down environment care skyward, forcing City. This is the tribe whose famous princess, advertising. But what’s less certainHelps City. This is the tribe whose famous princess, pin down where your target customers A major challenge a social-networking sitehealth is luring a costs community. disease and stroke, and around,” negotiatesays benefi ts for employees. silver bullet this time Havlin. “Many employers suchmethods international to prepare two are finding information. “Pay attention to who are already beyond information overload. feet 6.25 inches, but thenthis challenge to accounting 5.2 percent, the lowest increase since 1997, according to businesses to look for new to companies keep costshad under Local acts America First addressed by incorporating existing online communities Sacagawea, helped Sacagawea, helped 4. Click-through — When a visitor are considering a consumer-directed health plan.” reports. where they play,” Rollings says. The questions compound fromhealth.utah.gov/hearthighway/pdfs/Insurance_Health_Plan_ that point: Where do you Spain hasown. to turn around make the Mercer. But that’s just a temporary fix for a problem that control. isn’t easy, especially legislative In addition, Gov. Jon earlier this year into its “I don’t thinkand changing behaviorIt— especially with thisbecause demo —recent makes guideUtah the Lewis andHuntsman Clark clicks on your ad. Some media guide theoutlets Lewis and Clark Checklist.pdf Auto dealerships use banner ads on report; they just want information — and a lot of it. advertise health online?care How much do you spend? How will you capture same shot from the American distance. is steadily worsening. Compared to just nine years ago, the actions on both and statetechnology, levels are changing signed intoexpedition. law four bills that affect employers’ sense,” Whitehouse says. So instead of developing itsthe ownfederal video-sharing allow payment based on click-through. expedition. State of the stimulus The SEC made the move in part because of growing pressure major news websites and list their vehicles “Internet shoppers are typically a different type of and follow will you track your success? 2. The is played under rules. forgame example, it plugged in NBA YouTube (athe video-sharing website). And instead amount Utah employers are paying for employee health care health coverage landscape as well.ofItlaboring becomes costs. HB 165 simplifi es administrativeleads functions suchup on them? How UTAH COUNCIL FOR WORKSITE HEALTH PROMOTION Government actions have added to the elements that The tribe is a successful from the American Institute of Certified Public Accountants The tribe is a successful on every classified website possible shopper,” says Jon Wallace, the Internet director at Murdock to create new blog format, (free blogging software). These are questions is asking — especially After thatagame, another oneitisused WordPress 5. CPM — “Cost per thousand” ad has increased 100 percent. “Simple cost shifting won’t be the increasingly complicated for employers trying to keep as billing and authorizations. HB 188 creates a defi ned that every executive Aemployers group of employers, healthThinsurance representatives must consider. e American Recovery and (AICPA). On June 5 of this year, the AICPA’s IFRS website (www. business entity, partially business entity, impressions. (The “M” stands for the partially (including Cars.com, AutoTrader.com, A under sitemap and wireframes proved important because showed how the asite Chevrolet. “They need to be treated differently. A lot of them in acan slow economy, when marketing budgets are onAct theofchopping played international rules. silverCongress bullet this health care costs downthey while still providing quality contribution market in which employees choose and health professionals working to improve employee health. Reinvestment 2009, better known as the “Stimulus ifrs.com) reported that it (the AICPA) testified before in time around,” says Havlin. “Many employers Roman numeral for because 1,000.) because as soon as as soon as would be organized and how it wouldhealth function without a programmer to write KSL.com, etc.). They try to be everywhere, in the looking block. expands are considering benefi t planpaying and adhering to regulations. a guaranteed issue plan with pre-tax dollars, Bill” signed by President Obama onare February 17, willstages. A lot of them don’t understand health.utah.gov/worksitewellness October 2007, urging that the SEC “take comprehensive steps a consumer-directed health plan.” a line of computer code.would be absurd in Northern Utah To find answers to these questions, you need not look companies in Northern Utah because they never know where their quite what but theynone are looking Although this zaniness Linda Havlin, global to intellectual capital leader for financial reporting, including the role of companies the Internetinportal for access to health care profoundly affect many different industries, more for.” harmonize U.S. and international 6. Geo-targeting — Allows you became successful, they further Utah’s auto industry. Th is group has turnedOF to AMERICA became successful, they customers will be surfing. sports, something similar besets the accounting than healthcare. WELLNESS COUNCILS Mercer Health & Benefits, a global consulting, information, increases the transparency of thethan marketplace, State allowing American public companies to report financial results using of the stimulus to target views based on the visitor’s Design comes last moveNetCare elsewhere, traditional the Internet big way in recent Free years, finding world. The U.S. has its own set of accounting rules Th eand effis ects of thenotable Stimulus Bill Versus on employee the health care media would elsewhere, resources about worksite wellness, needs geographic location. This is move especially accounting standards.” outsourcing investment firm, has creates thewould lower-cost health benefi t plan in as aan Government actions have With a plan in place, they crossed one more and hurdle by international reviewing the technical important for small or regional Quality matters Fewand qualities online advertising are more success. And even though some dealerships cutting industry are come under fivea separate provisions of the of bill: assessments, how to start wellness council more. Michael — the United States Generally Acceptedfound Accountinghealth costs in previous according to Michael alternativeaccording to COBRA,toand reauthorizes the Health System added to the elements that requirements. Then — and only then — did that they start designing the site. That started businesses. Research on the comparative effectiveness health www.welcoa.org Don’t forget quality. Adams suggests The next step is for the SEC to allow U.S. companies to report appealingofthan the care value. Not only are rates lower traditional media advertising, their online budgets Principles (U.S. GAAP, orversions just GAAP) —recessions while other Devine, chief operating were elevated stressemployers must— consider. Devine, chief operating with creating several of the homepage. America Firstby took pieces from each Greg scothern, elected president ofReform GOaL Task Force. The Salt Lake Chamber’s Director of treatment and services, extendingthan the reach of HIPAA, the (TV, print, radio), auto — Greg scothern, elected president of GOaL inlaid-off IFRS. The AICPA site states, “The SEC is weighingExperiment whether to with the lookTh that quality ads are just as important online for traditional media are188, growing. countries their own suchClients as related UK GAAP of ethe site only Recovery and offiWesley cer of the tribe’s Public Policy Smith applauds HB saying, “The American low-rent city has been transformed into a top tourist destination, a host for world-class versionhave to create the firules, nal look. oftenillnesses use this and method, Whitehouse notes: offi cer ofa the tribe’s 7. Opt-in e-mail — When Health Information fordealerships Economicreport and Clinical EMPLOYER RESOURCETechnology GUIDE allow U.S. firms to report financial results using international financial after all of your planning is in place. starting — especially your photos. “I think the most a higher return on investment and “Th GAAP of Canada. Such a system created that continued to defined contribution allows families to aggregate Reinvestment Act of 2009, Frankenstein it.” hasworkers Economic system Development consumer requests Economic (or opts-in) toDevelopment earlier create severe setbacks. It’s often athletic events and a still-growing relocation center for international companieshavoc thatineyThanusually Health Act (HITECH Act), Medicare provisions, and Utah Department of Health’s Bureau of Health guide reporting standards rather than U.S. GAAP” — a step thatcan would important thing is to have good pictures,” forSystem onlinePromotion ads. In simple terms, they are getting more they’re doing it, why they do it and what you global one receive an e-mail notification from an e increasingly plans then went to monetary the computer programmers, who did several rounds of useworld, benefi ts while they were contributions from multiple employers. ItHere’s allowshow businesses known as the “Stimulus helpful to create multiple looks better for debate. Corporation. Corporation. Medicaid provisions. information and resources for developing a wellness program. effectively cut out GAAP altogether. With the U.S.’s difficulty in advertiser or news organization. Lists of he says. “People that list things without leads for every dollar of online should do to get similar results: to make gear, apparel and accessories for skiers and snowboarders. in which companies with multinational operations testing. Meanwhile, America First created the “crew” — of 18 young employees still covered. Hera group surveys to control the spiraling Bill” signed by President “That leftpremium us with acosts and still provide a “The most immediate impact [of the Stimulus] to these people are often bought “Thatand leftsold. us with a health.utah.gov/hearthighway/pdfs/EmployerResource.pdf gaining foreign underwriting to its shaky economy, this could be a pictures are just wasting their time. People advertising than for those spent on who seeded sitereports with content andfound will continue to feed it with new content. And often have to dothe fiscal in compliance with that immediately instead of being priced out of the market.” He also Obama on February 17, employers is the increased number of potential COBRA surplus ofbenefi highlyt educated, hard-working, great move to facilitate easier investment in American companies. surplus of highly educated, hard-working, carefully the webrules. address, making sure the same username was available buy out of emotion.” traditional media. Why online? morethey than one setselected of accounting following that spike, finds that the So Internet portal and transparency provisions will profoundly affect many participants,” Ann Thomas, principal in Mercer’s Salt CDC HEALTHIER says WORKSITE INITIATIVE 8. Run-of-site — An So ad that is talented professionals. because we had talented professionals. because we had at sites including YouTube, Twitter (a microblogging site) andasDigg (a news ranking To ensure that their photos are good, This value has compelled Menlove Consumers are shopping however, costs declined will “empower consumers to make better decisions.” different industries, but placed in a rotation so that it appears Lake offi ce. “In response, employers’ strategies toitmitigate designed for state and federal government, also According to the website of Fulcrum Inquiry (www.fulcruminquiry. people in the tribe who had been doing federalonline. You don’t need any more Though site). “I think it is really important to have a dotcom,” Whitehouse says. people in the tribe who had been they hired Orem-based Platinum Dealer throughout a website instead of in a doing federal Toyota, for example, to grow its online History employers enacted costHB 331 creates a level playing field for contractors none more than healthcare. costs willfor depend what options remain viable pending has ideas healthon promotion in non-governmental workplaces. com), a financial investigations and forensic accounting firm based in it doesn’t ensure that YourNextFirst. specific spot. rates for run-of-site contracting, we said, ‘Let’s get the tribe doing reason than that to advertise on hR manager at access Development, a Salt lakeAccording CityBut building contracting, we Ad said, ‘Let’s get the tribe doing Services to take pictures of each of their budget while cutting to www.icaew.com, the that site customers for the will come. Now proposed legislation.” Rob Tweed, clinical director for advertising Davis www.cdc.gov/nccdphp/dnpa/hwi/index.htm Los Angeles, requirements to use GAAP might be “an impediment bidding for state projects, no longer offering an advantage ads are typically less than for a featured com is live, the hard part begins: maintaining it, luring traffi c from the already affinity marketing firm in the Utah 100 and recently this as a tribe.’ We’ve worked closely with the the Web. This is increasingly true Surgical Center in Layton, notes that electronic recordsTV advertising. Online advertising this as a tribe.’ We’ve worked closely with the vehicles and upload them to the Internet. Institute of Chartered Accountants in England and for foreign companies to invest in the United States, and/or placement. to those not providing health insurance for employees, overcrowded web and measuring the site’s success. named a Work/life award recipient by the state Wales, as one Governor’sand Offi ce of Economic Development, for about 40 percent of its for Utah auto dealers. keeping provisioned HITECH will require an initial accounted cost CPA organizations from Britain, Canada and participate in the U.S. capital markets. This impediment comes with Governor’s Office of Economic Development, Many industries have vendors that provide UNIVERSITY OF UTAH’SinNUTRITION CLINIC penalizing those who don’t offer health coverage for They say the of “Utah’s Best Places to Work.” navis cites hidden costs for switchover, hardware and software, but afterwards will they’ve introduced us to federal agencies and this service. advertising budget in April and May, vast majority of people looking for little perceived benefits, as many financial analysts indicate that Nutrition resources including presentations, the U.S. began in 1966 exploring ways to converge they’ve introduced us to federal agencies and 9. Keyword targeting — When employees through the duration of the contract. SB 79 including unemployment and COBRa benefits, the cost of save money, and is a measure his company was planning to (i) the differences between the sets of accounting standards are classes and health screenings: an ad is displayed based wordson that On top of quality ads, Adams suggests according to Chad Rollings, director of cars look online first. people who can help us.reform Based for on emergency this great room international accounting standards. The following people who can help us. on Based this great addresses tort malpractice placing ads, and perhaps a headhunter. “if the employee appear on a webpage. Advertisers can implement anyway. becoming less pronounced, (ii) the reconciliations are information healthcare.utah.edu/nutritionclinic/corporate/index.html that you pay extra for featured placement. sales. “In general, online advertising is “I would guess the Accountants International Study Group tribal/state government partnership, we’ve beenbased cases, establishing a standard of proof on clear andthat if you tribal/state government partnership, was a salesperson, then it’s exponentially longeryear, to make often choose multiple keywords when we’ve been overkill, and (iii) the additional reporting comes too infrequently — On car listing websites, for example, more cost effective, but we are seeing surveyed, seven out of 10 people (AISG) is available. able to make inroadsevidence. on large government convincing — Chad rollings, director of sales, menlove toyota up the difference, because they typically take their bookwas (of formed, providing information regarding able this to make inroads on large government only once a year.” shoppers are confronted with hundreds enough play from the print ads that we look for used cars online before Local acts the issues and practices of international accounting. leads) with them.” contracts,” Devine says. contracts,” Devine says. of products. But, if you pay extra, you continue to do it,” he says. In June 1973, the International Accounting 10. Wallpaper ad — An ad Consumers inlifts control It’s true that a rising tide all boats. The they go shopping,” says John — CB It’s true that a rising tide lifts all boats. The that changes the background of the can have your listings show up first when Murdock Chevrolet spends a much smaller percentage of Adams, Internet manager for Jody Wilkinson Acura. Th is is a Standards Committee (IASC) was born. Its mission ALL-WEATHER HIRES TheOgden most generalized effect City of alland these changes is to by Carl Baumeister “boats” around — like Brigham “boats” around Ogden — like Brigham City and webpage. (Pandora.com frequently customers search. “Pay the money to be in its marketing budget online — only $7,000 of its $100,000 Though times are tough and some companieswas have the “rapid acceptance and implementation more—control the health benefit huge in thetime-saver hands of for consumers, he adds; it used to take an entire Box Elderput County are allof seeing an increase uses these ads.) — are all seeing an increase Box Elder County their face,” Adams says. found it regrettably necessary to choose employee layoffs, of an international accounting monthly budget. However, they report substantial success Saturday to look for a new ride. world-wide” the consumer. Locally, widest-reaching change is the in commerce and revenue. Jasonthe Perry, the in commerce and revenue. Jason Perry, the some industries are actually finding that business is And freshness counts, he adds. Don’t from their online advertising. “Internet ads probably Yet, as shoppers standard. From 1983 to 2000, they published 41 — TK a new defiOffi nedce contribution market for have moved online, their behavior has executive establishment director of theof Governor’s of changed. executive director of the Governor’s Office of generate 70 percent of sales,” Wallace says. Th ey generally don’t want to be pushed, the auto dealers health insurance, comparable to the movement from a

CLOSING THE

HEALING THE HEART OF

The potential impact of federal and state legislation on health care and coverage.

n a decade, this formerly shabby

ALL BOATS Ogden’s success radiates to the surrounding communities

No matter what media you are using to drive your traffic, the biggest thing that any business needs to make sure they do is have the right leadresponse system in place.”

The New Accounting and what it means to American businesses.

ALL-WEATHER HIRES

Though times are tough and some companies have found it regrettably necessary to choose employee layoﬀs, some industries are actually ﬁnding that business is

The events we create, like the Ogden Marathon, is a major economic engine for tourism, hotels and restaurants.”

4 5

JUMPING THE GAAP INTO IFRS

hR manager at access Development, a Salt lake City affinity marketing firm in the Utah 100 and recently named a Work/life award recipient by the state as one of “Utah’s Best Places to Work.” navis cites hidden costs including unemployment and COBRa benefits, the cost of placing ads, and perhaps a headhunter. “if the employee was a salesperson, then it’s exponentially longer to make up the difference, because they typically take their book (of leads) with them.”

Ogden’s success radiates to the surrounding communities

The events we create, like the Ogden Marathon, is a major economic engine for tourism, hotels and restaurants.”

In little more than a decade, this formerly shabby

med into a top tourist destination, a host for world-class ng relocation center for international companies that nd accessories for skiers and snowboarders.

10 TERMS

A RISING TIDE LIFTS ALL BOATS

2 3

GAAP CARE HEALTH

22 26 32 Jumping the GAAP

Healing health care

Switching from U.S. GAAP to IFRS.

Legislation snaps on the rubber gloves to resuscitate health care.

Utah CEO Case Study Utah auto dealers find success advertising online.

departments Wealth Management 36 Define your retirement

In Short 11 Briefs & People

One plan does not fit all.

A review of Utah business news.

Spotlight 16 Personal finances

A look at a real couple's balance sheet. SPOtlight

light

You could unknowingly break the law.

Founder/CEO Westfahl Devices

DERALD MILLER WAS AN ELEMENTARY SCHOOL ENTREPRENEUR. a friend’s

mom would take him and his buddies to Costco to load up on candy, which they would sell at the community pool. a few years later, miller would spend his summers atop his father’s riding lawn

AS AN ELECTRICAL ENGINEER FRESH OUT OF BRIGHAM YOUNG university in the 1980s, nicole toomey davis did not expect to go over to the “dark side” of business management as some of her early colleagues called it. However, working on a case study

18 Nicole Toomey Davis

mower, making a cool two or three grand for the season. today, miller is at the helm of Westfahl

devices, an Orem-based manufacturer of home security devices he founded in september 2005. “I’ve always been on the track that I’ve wanted to do my own thing,” he says.

the devices are the type that detect when a door or window is forced open. miller was exposed to the products when he sold them door-to-door for the provo office of Virginia-

based apX alarm in the summer of 2005. While there, company technicians pointed out some deficiencies that miller thought he could improve upon.

Home security is not a sexy industry, but miller, who graduated from utah Valley university in

with business professor and author Jim Collins on the entrepreneurial beginnings of Giro sport design’s revolutionary bicycle helmet proved to be a significant transformative moment for davis, while a stanford university mBa student in the late 1980s.

“It was such a powerful impression to see that good management and leadership mattered in

business,” davis says about her experience working with Collins on what would become a Harvard Business school Case study published in 1990.

davis took her mBa lessons to heart when she launched doBox Inc. in 1999 with her husband

Director Centers of Excellence 2008 with a business degree, says he was “just looking for something I knew I could do better than somebody else.” With input from the technicians who installed the devices, he made a design

change involving the connecting wires. “It seems like a small change,” miller says. “But it saved them so much time.”

the manufacturing aspect of the business was not foreign to miller. from september 2002 to

may 2005, he worked for an Orem-based sporting goods manufacturer where he was in frequent contact with Chinese manufacturers. It was these he turned to when he began Westfahl devices. His big break — and biggest challenge — happened when an order anticipated to be for

$10,000 to $15,000 of product instead came in at $400,000. suddenly, he found himself in need of $250,000 for manufacturing costs — an amount that banks were hesitant to loan to a 23-year old. With only $400 in savings, he turned to venture capitalists and was fortunate to secure funding

and fulfill that order. He doubled profitability the following year, and now, just a few years later, he

is running a $1.5 million company. apX is one of his largest customers, and the product line has expanded to include circuit boards and other related items. such quick growth comes from his customer service philosophy. “the most important thing is building value in any way I can” in such a price sensitive time, he says. for example, at no cost

Brad, a software architect whom she describes as a “technical visionary.” the company grew

rapidly, providing residential software and parental control solutions for the broadband gateway industry. netopia (and later motorola) acquired the company in 2002. today, she and her husband run enclavix, a draper-based software and technology development company.

davis says she and her husband surprise many people in terms of their working relationship.

“We have a very strong family bond, but we’ve always been very demanding of each other when it comes to business and we’re not afraid to be blunt and open as possible,” she says. “It’s not a good idea if both partners have the same sets of skills. Our skills complement each other and that’s important.”

unlike many of her fellow students at stanford, davis didn’t expect to go into public service.

“It was a big left turn,” she recalls. However, in 2003, she joined key business colleagues in

leading the industry push for the utah fund of funds, a matching program designed to increase the venture capital base for the state’s rapidly expanding high technology industries. today, as director of the state’s Centers of excellence program, she works on matching entrepreneurs with technologies developed by researchers in the state’s universities and providing financial seed

only the cost of the shipping itself.

In addition to running the company, miller has been driving back and forth from utah state

university to earn an mBa. “You can never have enough education,” he says, adding that it’s sort of an “insurance plan.” He is confident of continuing success, but acknowledges, “You never

Strategies & Tactics 44 COBRA and the stimulus How to comply with recent legislation.

Health care and health

coverage reform starts with a focus on quality.

59 Inexperience can be good Sometimes what you don't know can help you.

In utah’s thriving environment of innovation, davis sees the challenge in terms of human

resources, not in technology. “We easily have scores of new technologies that come out of the universities each year,” she explains. “But entrepreneurs with energy, vision, passion and confidence are the true scarce natural resource. so often, great technologies die if they don’t have a good management team to carry it forward.”

know what might happen to the business. You have to be as prepared as you possibly can for the future.”

trimming your marketing budget.

incentives to help grow startup commercial enterprises.

20 Derald Miller

to the customer, he will store their inventory until they need it. and he will drop-ship for them for

Think carefully when

Legal Ease 42 Beware unlicensed broker-dealers 58 Quality care

Derald Miller

Viewpoint 56 Recessionary marketing

Founder/CEO Text by John Blodgett Photo by Jed Call

Westfahl Devices

60 Bringing the world to rural Utah

48 CFO for hire

If you don't (yet) need a full-time The American Recovery chief financial officer, hire a temp. and Reinvestment Act of 2009.

Lifestyle 54 Life support

Arts and cultural groups need your support more than ever in this economy.

61 Keep at it If at first you don't succeed, fail, fail again.

Statistics 62 By the numbers

A look at the state's economy through significant data. UtahCEOmagazine.com

july 2009

“INSTEAD OF A 15¢ PER HOUR RAISE…

TV/Film Star Corbin Bernsen

… you could give your employees an incredible benefit package that includes, immediate access to a board certified physician and a prescription within less than an hour, anytime, day or night, holidays and weekends. With no waiting, no missed work, and no cost!

They’ll also save up to10% to 60% off at 76,000 Dentists, 12,000 EyeCare centers (including all the national chains), 3,000 Chiropractors, 58,000 Pharmacies,( including all the national chains), Top hearing specialists, 20,000 attorneys, even 24/7 towing and roadside assistance, and ½ price dining at more than 50,000 restaurants large and small. It’s all included on the American Relief Card. You and every family member should have one, and so should every employee! You simply can’t afford NOT to have one! Even if you have insurance…and especially if you don’t!” Contact Group Field Sales Manager Zachary Stilson at 801-613-6063 or send a email to ACRbenefits@yahoo.com for additional information or to set up an appointment in your office.

“RELIEF” AMERI

Member

CAN

g Card

e Pricin

Privileg

STOMER N Q. CU M R .J O H # 0 0 0 0 0 0 0 0 0 1 Member 4092B 8 G ro u p #

COMCAST BUSINESS CLA

GET UP TO 6 MONTHS OF BUSINESS CLASS INTERNET

FREE

For a limited time, you can get up to 6 months of Business Class Internet for free when you order Business Class Voice with a 2-year agreement. It’s phone service with advanced business features and super-fast Internet thrown in for free. It’s not small business, it’s fast business. • Faster than T1 and DSL • Includes Microsoft ® Outlook email and SharePoint • Fully featured phone service that’s rated #1 in call clarity • 30-day satisfaction guarantee

Call 866.816.3786 today Not available in all areas. Service subject to Service Order Agreement and General Terms and Conditions. $99 offer limited to Business Class Starter Internet, one Business Class Voice line, and Business Class Basic TV. Minimum one year term contract required. Early termination fees apply. Equipment, installation, taxes, franchise fees, the Regulatory Recovery Fee or other applicable charges (e.g. international calling or per-call charges) extra. Up to 6 Months Free Offer: Expires 9/7/09 and is limited to new Business Class customers. Requires subscription to at least 1 full featured Voice line and 6, 12, 16, or 22 Mbps Internet service where available. Number of free months of Internet service determined by number of voice lines activated. Minimum one year contract required. Internet: Actual speeds vary and are not guaranteed. Voice: $24.95 activation fee (per line, up to 4 lines) applies. EMTA required ($5/month). Service (including 911/emergency services) may not function after an extended power outage. Transfer of existing telephone number not always available. Call clarity based on independent study performed by Keynote in November 2008, Wave 6 study. TV: Not available for public viewing areas such as bars, restaurants and residential addresses. Call for restrictions and complete details. Comcast ©2009. All rights reserved. All other trademarks are the property of their respective owners

ASS VS. THE OTHER GUY (if only all of your business decisions were this clear-cut) Comcast Business Class

Qwest Choice™ Unlimited for Business*

Comcast Business Class Voice

Qwest Choice

• Unlimited local and nationwide long distance calling to U.S. and Canada

• Unlimited local and nationwide long distance calling including U.S. and Canada

• Keep your same phone number

• 12 calling features, including Voice Mail ✔

• No ability to check voice mail from your computer with Internet access

• SmartZone™, where you can check and manage Voice Mail from your computer with Internet access ✔

Comcast Business Class Internet

Qwest Internet

• Download speeds up to 6 Mbps ✔

• Download speeds up to 1.5 Mbps

• Upload speeds up to 1 Mbps ✔

• Upload speeds up to 896 Kbps

• Plus, get download and upload speeds up to 12 Mbps and 2 Mbps respectively with PowerBoost®

Comcast Business Class TV

DirecTV Office Information TV

• Your favorite local networks like ABC, NBC and CBS plus channels like The Discovery Channel ✔

• Local networks at an additional cost

Total:

• Phone • Internet • TV

/month

When you subscribe to all 3 services in a 1 year agreement

Total:

177

• Phone • Internet • TV

/month

(not a promotional rate)

Savings compares Comcast Business Class 6 Mbps Internet, Phone and TV to Qwest Choice 1.5 Mbps Internet, Business Prime phone line with voicemail and TV as of 5/14/2009.

Get more Phone features, more Internet speed... plus business class Cable TV! An obvious move to save month after month doesn’t come around all that often in business. So why wait? Switch to Comcast today and enjoy digital Voice, Internet and TV for just $99 a month.

Call 866.816.3786 today and get this amazing low rate for three business services. For a limited time, get FREE standard installation (requires 3-year contract). Act today!

Comcast Means Business

Published by: mediaOne of Utah a newspaper agency Company 4770 South 5600 West PO Box 704005 West Valley City, Ut 84170-4005 www.mediaoneutah.com telephone: (801) 237-2815 Fax: (801) 237-2070 Publisher: Brent low Associate Publishers: jed Call and monica liban

Health care and health coverage in the United States are at a tipping point. Things are going to change. What’s in question is whether the system will worsen or improve. No doubt, in the short term — however long that may last — there will be a lot of hand wringing and head scratching as individual states and the country as whole grapple with the issue of overhauling health care and health coverage (someone recently brought to my attention that the two issues are separate, but often erroneously believed to be one and the same). Brian Staker examines how these two industries may be affected by recent state legislation and the stimulus package. (Also, read the Viewpoint about health care reform written by Charles Sorenson, Intermountain Healthcare’s new president and CEO.) Change is afoot in accounting, as well, though in a less urgent timeframe. But it, too, looks inevitable. The United States Generally Accepted Accounting Principles (U.S. GAAP) have competed for years with GAAPs of other countries. This means global companies have had to account according to more than one set of accounting rules. The International Financial Reporting Standards (IFRS) may change all that. It’s gaining acceptance the world over, and many believe U.S. companies will eventually convert to the system. Carl Baumeister tackles the subject in his feature story. The committed reader will recall that my letter last month also dealt with change. It’s a sign of the times, along with the accompanying uncertainty and discomfiture. It’s typically difficult for a regional monthly magazine to be overly tactical – editorial calendars tend to be determined a year in advance. Advertisers appreciate this, because their budgets must also be planned in advance, but the disadvantage is that it limits a publication’s ability to offer more than a smattering of content that’s relevant to the topic of the day. I like to believe that Utah CEO does an admirable job of filling its pages with current, relevant and hopefully useful content. But the judges are ultimately you, our readers. I’m always open to constructive criticism (and praise too, of course). Please let me know how we’re doing, and how we can better serve you. Email me at jblodgett@utahceomagazine or call me at 801-204-6320.

john Blodgett Editor

UtahCEOmagazine.com

july 2009

Vice President of Advertising: trent Eyre Editor: john Blodgett Associate Editor: Steve gooch Layout/Design: Brian hugo Contributing Writers: Carl Baumeister, allison hansen, les Roka, Brian Staker, Kevin timken Manager Advertising Sales: mary ann Di lapi, (801) 204-6381 Advisory Board: Charles R. Cambra iii, Workforce Solutions Peter helfrich, KeyBank Kim jones, Verite Susanne Kennard, Black Pearl tresha Kramer, This is The Place heritage Park antonio a. mejia, Kirton & mcConkie todd Russell, americom technology inc. Contact Information: letters to the editor, news releases and general info: editor@UtahCEOmagazine.com Subscriptions, reprints and back issues: subscribe@UtahCEOmagazine.com advertising: advertising@UtahCEOmagazine.com (801) 204-6381

Introducingthe theAll-New All-New2009 2009 Introducing

MAXIMA MAXIMA THE4-Door 4-DOORSporTS SPORTSCar CAR The

TM TM

Text “NissanSandy 2950526” to 48696 to test drive this vehicle on your phone!

NEW 2009

NISSAN NISSAN MAXIMA MAXIMA 4-DOOR SPORTS 4-DOOR SPORTS CAR CAR Now elegance has an edge.

TM TM

Now elegance has an edge.

✔ 290 Horsepower 4 290 Horsepower ✔ Power dual-panel moonroof* 4 Power dual-panel moonroof* ✔ 26 MPG 4 26 MPG ✔ Nissan Intelligent KeyTMTMwith push-button-ignition 4 Nissan Intelligent Key with push-button-ignition ✔ 3.5 liter V6 engine 4 3.5 liter V6 engine ✔ 7” color display with rear view monitor* 4 7” color display with rear view monitor

Tim Dahle Nissan 10785 S. Automall Drive, Sandy, Utah 84070 Tim Dahle Nissan 801-495-3800 www.timdahle.com •

10785 S. Automall Drive, Sandy, Utah 84070 *Available feature. EPA fuel economy is estimate only. Actual mileage may vary with driving 801-495-3800 • www.timdahle.com conditions. Always wear your seatbelt and please don’t drink and drive.

Nissan, the Nissan Brand Symbol, “SHIFT_” tagline and Nissan model names are Nissan trademarks. 2008 EPA fuel economy estimates are Altima 2.5S 23 city, 31 highway with CVT transmission; Altima Coupe 23 city, 31 highway; and Altima Hybrid 35 city, 33 highway. Actual mileage may vary with driving conditions- use for comparison only. Government star ratings are part of the National Highway Traffic Safety Administration’s (NHTSA’s) New Car Assessment Program. (www.safercar.gov) Model tested was 2008 Nissan Altima with standard driver and passenger air bags. Always wear your seatbelt and please don’t drink and drive. Nissan, the Nissan Brand Symbol, “SHIFT_” tagline and Nissan model names are Nissan trademarks. 2007 Nissan North America, Inc.

in ShORt

fOr starters

Right now I will say that our position is a public plan that makes sense ... We have not drawn lines in the sand other than that reform has to control costs and that it has to provide relief to people who don’t have health insurance or are underinsured.”

Quote me

on that . . .

— President Barack Obama in a June 23 press conference at the White House, pressing Congress to pass extensive health care legislation. If it does not, he said the country will spend $1 out of every $5 on health care within the next 10 years. The President also discussed the creation of a clean energy economy and the post-election violence in Iran. (Msnbc.com)

Some states have laws that make it more diﬃcult for creditors to go after a delinquent debtor’s paycheck. And those states tend to have lower bankruptcy rates than those [states such as Utah] where it is easier for creditors to garnish wages.”

Injecting additional money into the banking system is a pretty dangerous game right now, and the Fed cannot aﬀord to press on the accelerator amid a potentially inﬂationary environment.”

— Brigham Young University economist Lars Lefgren, who co-authored a bankruptcy study with colleague Frank McIntyre. Titled “Explaining the Puzzle of Cross-State Differences in Bankruptcy Rates,” the report is the result of the pair’s desire to explain why personal bankruptcy filings vary greatly from one state to another. (Salt lake tribune)

— Richard Yamarone, economist at Argus Research. Most observers believe that the Fed, which in March launched a $1.2 trillion initiative to decrease interest rates, could decide to play it safe by slowing its spending. But even putting on the brakes carries danger — the return of skyrocketing interest rates. (Deseret news)

They confused people staying away from fuel eﬃcient, small cars as not liking fuel economy instead of the fact they made mediocre cars that no one wanted. If GM had followed its own research it would likely not be in Chapter 11 [bankruptcy protection] today.”

The 2020s for most of the developed world will be an era of fiscal crisis, with a real long-term stagnation in economic growth and ugly political battles over old-age benefits cuts.”

— Rob Kleinbaum, co-author of a University of Michigan study that states U.S. auto makers underestimated consumer interest in fuel efficient vehicles. (Associated Press)

— Richard Jackson, director of the Center for Strategic and International Studies’ Global Aging Initiative, responding to a report showing that the world’s over-65 population will triple by 2025. By that year, roughly one in six people worldwide will be senior citizens. The study forecasts trouble across the globe, but mostly in China where seniors will hold a 61 percent majority over young workers by 2050. (Deseret news)

It is standard practice to discount consumer research. It was only applied to safety and quality issues.” — Walter McManus, co-author of the above study. (Associated Press)

The global recession has deepened … unemployment is on the rise, and poverty is set to increase in developing economies … the expected recovery is projected to be much less vigorous than normal.”

— The Washington-based World Bank, which cut its 2009 global growth forecast in a recent report. It predicts the world economy will shrink by 2.9 percent and global trade will drop sharply by 9.7 percent. The relatively strong economies of China and India will contract 1.6 percent, according to the report. (Associated Press)

This is like ‘Extreme Makeover: Corridor Edition.’”

— Ted Knowlton, a planning agent hired by the Wasatch Front Regional Council, discussing proposed alterations to State Street. City and state entities and agencies have put forth the idea of making the city’s 16-mile artery more walker- and bike-friendly by slowing traffic, landscaping walkways and adding more retail shops and new housing. (Salt lake tribune)

UtahCEOmagazine.com

july 2009

in ShORt

neWs BrIefs Will Utah be among the early risers from the recession? It depends who you ask. Contrary to a moody’s Economy.com prediction that Utah will lag behind at least 20 other states in emerging early from the recession, two economists say the state’s historically strong demographic, transportation and labor fundamentals should help Utah rise out of the downturn as early as the first quarter of 2010. The moody’s forecast indicates that Colorado, idaho, Oregon, texas and Washington — states with solid bases of high technology or energy industries — will lead the first wave of job growth as early as this year’s fourth quarter. Wyoming also is anticipated to emerge at least one quarter earlier than Utah. james Wood, director of the University of Utah’s Bureau of Economic and Business Research, says he wouldn’t be surprised if Utah will be among the strongest economic performers in 2011. “Our fundamentals haven’t changed,” he explains. “Utah’s demographic growth has always been an ace in the hole.” moreover, he says that the cost, quality and supply of Utah’s labor pool appeals to new businesses, as does the state’s strategic transportation advantages, which includes a major airline hub and the capacity for overnight road shipping to the West Coast. moody’s forecast makes some sense if one considers the sharp drop in residential and commercial construction industry employment, says mark Knold, senior economist for the Utah Department of Workforce Services. less than two years ago, Utah led the nation in relative rates of job growth, adding more than 50,000 jobs in the year prior to October 2007. “Even in absolute numbers, we were ranked ninth in job growth, ahead of bigger and more populous states,” he adds. however, Knold notes that one-fourth of those jobs were in construction, with the total number of new jobs in that sector soaring to 103,000 in 2007. By the beginning of 2010, that number will fall to 65,000. Despite the decline, he agrees with Wood that the timing in moody’s forecast should be tweaked. “We have unique characteristics in Utah explaining why we’ve been tied for fifth among states in terms of our average yearly economic growth when it’s been tracked over the last 40 years,” Knold says, adding that these factors include the state’s long-term population growth and an active entrepreneurial culture. meanwhile, a recent american legislative Exchange Council (alEC) report indexing states according to their economic competitiveness ranked Utah first in the nation for its economic recovery potential. The state’s economic performance over the last 10 years was compared to its economic outlook as measured by 15 policy factors including tax rates, fiscal responsibility in the state budget, and the state’s legal and regulatory systems. The alEC index shows Utah’s gross state product and personal income grew by more than 80 percent over the last decade while the state population has grown by nearly 27 percent and per capita personal income rose by more than 45 percent in the same period. Colorado — ranked in moody’s top five states — is second in the alEC index. — les Roka

UtahCEOmagazine.com

july 2009

a study by two Utah researchers shows that, contrary to popular belief, public companies tend not to report bad news after market closing. Researchers matthew magilke of the University of Utah and jeffrey t. Doyle of Utah State University studied the earnings reporting habits of approximately 3,200 corporations between 2000 and 2005 and found that about one-third of those companies report on a set time and date after the end of the quarter. they discovered that although 2,500 companies switched the time of their reports (from before market opening or after closing), it didn’t seem to be an indicator of either good or bad news. their study, “the timing of Earnings announcements: an Examination of the Strategic Disclosure hypotheses,” was published in The Accounting Review.

in ShORt

a report from the Deseret News reveals that recent auto dealer closings are affecting not just employees, but Utah cities as well. Cities gain much of their budgeted cash from taxes, but because numerous Chrysler and general motors dealerships across the state have been closed in the wake of the manufacturers’ bankruptcies, the cities aren’t getting the tax revenue they need. according to the report, the city of St. george has reported $90,000 less in sales tax revenues Honoring Utah’s than just two years ago. Brightest Sandy city has seen Companies a 15.9 percent drop in tax revenue when comparing the 12 months from march 2007 to February 2008 to the same period between 2008 and 2009. to combat the decrease, most communities are cutting services or leaving vacant positions unfilled.

Business travelers rejoice! Salt Lake International Airport began offering free Wi-Fi access in early July. the airport’s contract with its current provider, Boingo Wireless, expired on june 30; as part of the contract, travelers paid $7.95 for 24 hours of internet access. now, users can log onto the Web for no cost. the airport is expecting that net traffic will rise when the payfor-play contract ends; when Denver international airport set its Wi-Fi free, traffic spiked from 600 connections per day to 5,000 connections — an eightfold increase in just a month. the airport will assume the lost revenue from the paid Wi-Fi for now, but airport officials aren’t ruling out an advertising scheme in the future.

2009UTAH100

Applications are now being accepted for the 2009 MWCN Utah 100 Awards.

honored at the 15th Annual Awards Luncheon, being held at the Grand America Hotel in Salt Lake City, on October 23, 2009.

There will be honorees selected in the categories of 100 Fastest Growing Companies, 15 Largest Revenue Growth Companies and 15 Emerging Elite Companies. The deadline for submitting applications is July 21, 2009.

eBay agreed to expand its employment levels in Utah, thanks to $1.7 million in incentives given it by the governor’s Oﬃce of Economic Development (gOED). The online auctioneer, which already employs 1,100 Utahns, will create up to 200 new jobs at its global customer service center in Draper. The incentive — which will take the form of a tax credit — requires that eBay pay its employees at least 25 percent more than the average wage in Salt lake County; the company has pledged to pay an average wage of $52,000 — 27 percent more than the county average. eBay is also expanding its operations by building a new $334 million computer center that will create 50 new jobs, for which it is getting $27.3 million in incentives.

at www.mwcn.org. Interested companies can call 801.966.1430 or email to info@mwcn.org for additional information.

2009 MWCN Utah 100 Sponsors:

Ballard Spahr Andrews & Ingersoll, LLP CBIZ Deloitte Durham Jones & Pinegar Grant Thornton LLP Holme Roberts & Owen, LLP Jones Waldo KUED/KUER MARSH/MERCER

Established 15 years ago as Utah’s premier Business Growth Recognition Program

MountainWest Capital Network is accepting applications for the 2009 MWCN Utah 100 Awards. Candidates for the awards, which will be given in three categories — 100 Fastest growing companies, 15 top Revenue growth companies and 13 “Emerging Elite” companies — must be Utah-based for-profit companies. the deadline for entry is august 4. Companies can apply online at mwcn.yourmembership. com/?page=Utah100app or by calling 801-966-1705. the awards will be given at a luncheon on October 23 at the grand america hotel. Winners of the 2009 MWCN Utah 100 Awards will appear in the November issue of Utah CEO. For more information, visit www.mwcn.com.

Merrill Corporation MonaVie Parsons Behle & Latimer PricewaterhouseCoopers LLP Stoel Rives LLP Tanner LC Utah CEO Zions Bank

UtahCEOmagazine.com

july 2009

Microsoft announced that it will move into the new Thanksgiving Park office complex in August. the software behemoth will occupy 24,000 square feet of office space and will bring roughly 100 jobs to the state. thanksgiving Park is a new five-building office park located in lehi near thanksgiving Point. Other notable occupants include Sorenson Capital, Vucci technology group and Private Capital group, among others. microsoft is expected to use its new location primarily for software development. numbers released by the Federal Reserve show that the recessionary economy eliminated $1.3 trillion of Americans’ individual wealth during the first quarter of 2009. the numbers refer to the difference between individuals’ assets (home value, investments) and liabilities (mortgage, credit card debt), and show that the accumulated net worth of americans dropped by 2.6 percent from january to march. the Fed also says that the rate of americans’ personal savings jumped to 5.7 percent in april alone, a level not seen since 1995.

in ShORt

peOpLe Jeffrey R. Johnson was named CEO of Progrexion. johnson has previously served as president and CEO at numerous large firms, including gmaC bank and the Prudential Bank & trust Co. (a subsidiary of the Prudential insurance Co.). he has also held executive marketing positions with numerous other companies, including Equifax, Bank of america and the Colgate-Palmolive Company. Progrexion is a Salt lake Citybased marketing firm that specializes in the consumer financial services sector. Wadsworth Brothers Construction President Guy Wadsworth was honored with the Utah Department of transportation’s (UDOt) 2009 trailblazer award. The trailblazer award is given annually to the person who has fostered, advanced and advocated research in transportation in Utah over a substantial period of time. Wadsworth received this year’s award for his work in accelerated bridge construction — Wadsworth Brothers was the firm responsible for replacing four interstate 80 overpasses in 2008. The job, which temporarily shut down Parley’s Canyon over two consecutive weekends, was recognized as the fastest-known bridge replacement for two structures in north america.

University of Utah alum Robert McDonald was named CEO of Procter & gamble, the world’s largest consumer products company. in a statement by P&g’s board of directors, mcDonald was lauded as “the most broadly and globally experienced CEO in P&g history.” This is due to a life that has led mcDonald to live and work throughout Europe, Canada and asia, notably serving as P&g’s general manager in the Philippines, then in japan as leader of the company’s asian operations. The Utah technology Council (UtC) named three Utah business leaders to its hall of Fame: Greg Butterfield, Pete Meldrum and Mark Skolnick. Butterﬁeld is managing partner of consulting ﬁrm SageCreek Partners and has held executive positions at companies including altiris, novell and WordPerfect, and was winner of the 2002 Ernst and young Entrepreneur of the

The Real Estate investment Securities association (REiSa) appointed Craig M. Porter-Rollins to its board of directors. Porter-Rollins is CEO of Orem-based ljCooper Capital management, a ﬁnancial services ﬁrm and nationally ranked Registered investment advisor. at ljCooper, he specializes in wealth management, alternative investment options and capital gains tax issues. Porter-Rollins will occupy the board’s registered representative seat with REiSa, which expires in December 2009.

UtahCEOmagazine.com

july 2009

year award; he also served as the Utah information technology association’s (now UtC) chairman of the board from 2003 to 2005. meldrum is the co-founder of myriad genetics and has served on the board of directors of the american Red Cross’ golden Spike Chapter; he has worked in the life sciences industry for more than 30 years. Skolnick is co-founder and chief science oﬃcer of myriad genetics; he was one of the scientists who worked on the human genome Project. The Salt lake Chamber appointed Sterling Nielsen to its board of governors. nielsen, who currently serves as president and CEO of mountain america Credit Union, is a certiﬁed public accountant who is also a director and past chairman of the West jordan Chamber of Commerce and a director of the Utah league of Credit Unions. he will serve on the Chamber’s board for three years. Dan Young, founder and president of Utah-based PC laptops, a computer retail chain, was named to microsoft’s Partner advisory Council. The council is made up of top executives of companies that work with microsoft in various capacities. Council members meet to discuss with each other and microsoft feedback on microsoft products, marketing programs and future initiatives. according to the computer giant, PC laptops sells a higher percentage of computers with microsoft’s Windows operating system preinstalled than any other retailer in north america.

“ The Newspaper Agency Company is delighted to have Moreton & Company as our employee benefits broker. ” –Brent J. Low, CEO Moreton & Company is a leading insurance broker and consultant with a proven history of stability, innovation, and strength in the insurance market.

We serve a diverse group of clients in

Our exceptional benefits professionals

many industries and have developed

consistently design comprehensive,

a specialized approach to their unique

cost-effective programs and provide

employee benefit, property, casualty,

full support for our clients’ human

and surety needs.

resource operations.

Founded in 1910, we now have offices in

We place over $315 million in annual

A well-designed benefits program can

Utah, Idaho, and Colorado, and are one

benefits premium and maintain

be among a company’s most valued

of the largest privately owned insurance

significant market relationships with

assets. To learn more, visit our website

brokers in the United States.

the world’s leading insurers.

or call us at 801-531-1234.

www.moreton.com

SPOtlight About this article: This column is intended to provide a glimpse into the realities of personal finance management for real Utahns in every stage of life. If you or someone you know is interested in a free wealth management consultation, please contact Jordan or Richard Collins. Report by: Jordan Collins, financial advisor at Morgan Stanley Smith Barney

persOnaL FINANCE Financial goals

• Start a college fund for the new baby on the way • Figure out budget with future baby expenses • Possibly ﬁnd more stable income while still pursuing real estate • Retire near the normal retirement age with the same standard of living

Current situation

Marc and Danielle post a negative net savings every month, caused in part by Marc's unpredictable and unstable income, The couple have $80,000 in retirement accounts, $36,000 in an emergency fund and $8,000 in a liquid bank account.

THE BOTTOM LINE: Annual income

Assets

Marc's commissions Danielle's salary Rental property income TOTAL

$38,400 $53,688 $12,600 $104,688

Monthly outgoing

Marc, 36 Occupation: Realtor

Danielle, 35

Occupation: Marketing representative

Taxes (Federal & State) $1,853 Property taxes escrowed Contributions to 401(k) $771 Health insurance premiums $78 Medical reimbursement account $92 Co-pays/medical services $358 Drugs and medical supplies $64 Dental $3 Disability insurance premium $12 Clothing and miscellaneous $200 Haircuts, dry cleaning, etc. $62 Mortgage and escrow pymt $1,400 Rental mortgage $1,050 HOA fee $5 Household maintenance costs $85 Household miscellaneous $20 Utilities $178 Groceries $400 Dining out $480 Auto ins., registration, etc. $175 Fuel and maintenance $300 Internet/cable/phone $148 Cell phone $215 Charitable contribution $25 Entertainment and recreation $95 Travel, hobbies, leisure $242 Personal gifts $100 Miscellaneous $33 Real estate fees/advertising $1,000 Dog expenses $92 Medical bill payment $110 TOTAL $9,646 NET MONTHLY SAVINGS $(922)

UtahCEOmagazine.com

july 2009

Home value Rental home value Automobiles' values Bank accounts Marc's 401(k) Danielle's 401(k) Danielle's IRA Miscellaneous stocks CDs (emergency fund) TOTAL

$300,000 $240,000 $10,000 $8,000 $13,000 $61,000 $10,000 $2,500 $36,000 $680,500

Liabilities

Mortgage $216,000 Rental property mortgage $137,000 Medical bills $8,000 TOTAL $361,000 NET WORTH

$319,500

Full disclosure: The information in this report belongs to a real couple whose identities were concealed for privacy. They received a free wealth management consultation by Jordan Collins at Morgan Stanley Smith Barney and the information herein has been printed anonymously.

SPOtlight SPOtlight

Summary Summary marc and Danielle need a ﬁnancial

marc andTh Danielle need expenses a financial renovation: eir monthly renovation: Th eir monthly expenses exceed their monthly income and they exceed theirdipping monthly income and they have been into their savings have been dipping into their savings each month to cover their shortfall. each month to cover shortfall. marc’s income is verytheir sporadic, and for marc’s income is very sporadic, for ease of reading we averaged hisand 2008 ease of reading we averaged his 2008 compensation into a monthly figure. (in compensation into a monthly figure. (in

reality, his 2008 income was generated reality, incomeof was duringhis the2008 last quarter thegenerated year.) at during the last quarter of the year.) at present, marc’s real estate career has present, marc’s real estate career has stalled due to the ailing economy, and stalled due to the and they are trying toailing makeeconomy, do on Danielle’s they are trying to make do on Danielle’s monthly salary. monthly marcsalary. and Danielle are expecting marc Danielle are expecting their ﬁrstand child this September, and the their ﬁrst child this September, and the

additional expenses and responsibility additional and responsibility that comeexpenses with parenthood. With the that come with parenthood. With extra time provided by a slow realthe estate extra time provided by a slow real estate market, marc has decided to go back to market, marc has decided to go back to school and ﬁnish his degree, hoping it school and ﬁnish his degree, hoping it will provide him with additional career will provide him with additional career options. options.

Recommendations Recommendations SHORT-TERM GOAL SHORT-TERM GOAL With additional expenses and With additional expenses andhorizon, responsibilities looming on the responsibilities looming on the horizon, marc needs to find additional work, marc needs to fi nd additional work, preferably with salaried pay, at least preferably with salaried pay, at least until the housing market turns the until the housing market turns corner. Because their expenses the exceed corner. Becausesalaried their expenses their income, pay mayexceed assure a their income, salaried pay maybe assure a consistent paycheck that can counted consistent paycheck that can be counted on month in and month out to cover on month in and month out to cover those expenses. thosemarc expenses. has some contacts with the marc some contacts with the is a local fire has department and says there local fi re department and says there is a a possibility of working two 24-hour shifts possibility of working two 24-hour shifts week. This job seems like a good situationa week. This seems like a good situation because it job would allow marc additional because it would allow marc additional time on his days off to keep his real estate time his days off to keep hisside. real estate agentoncareer breathing on the agent career breathing on the side.

LONG-TERM GOAL LONG-TERM The job withGOAL the fire department could Th e jobmarc with and the fiDanielle’s re department help with short-could help with marc and Danielle’s shortterm goals of providing for their baby. term goals of providing their baby. additional fixes need tofor happen to address additional fi xes need to happen to address their long-term goals of retirement and their long-term goals educational of retirement and funding their child’s expenses. funding educational expenses. Becausetheir marcchild’s understands real estate, Because marc understands real estate, he is comfortable with owning additional he is comfortable with owning property to help create wealth.additional in many property to help create wealth. in many cases, real estate can be considered as part cases, real estate can be considered as part of an investment portfolio, but non-real of an investment portfolio, but non-reala estate assets are necessary to maintain estate assets are necessary to maintain a diverse portfolio. diverse portfolio. With the extra income marc could With the extra marc we’ve could earn from the fire income department, earn from the fi re department, we’ve determined that, along with the income determined along with thethat income from his twothat, rental properties can from his two rental properties that can

be sold at retirement, marc and Danielle be sold need at retirement, marc$11,000 and Danielle would to save about a year would need to save about $11,000 a year to keep their current standard of living to keep theirretirement. current standard of living throughout throughout retirement. as a good rule of thumb, if you can a good rule oftoward thumb,aifchild’s you can saveas$200 a month save $200 a month toward a child’s education starting the year they are born, education the year they areaborn, the futurestarting beneﬁt could help fund the future beneﬁ t could help fund majority of your child’s expenses. aif marc majority of your expenses. if marc and Danielle arechild’s prudent with their extra and Danielle are prudent with their extra income, this should not be a problem. income, this should not be a problem.

Conclusion Conclusion

it will be extremely difficult — if not impossible — for marc and Danielle to reach their short-term goals if marc cannot it will extremely cultbe —their if notfirst impossible for marc Danielle to reach theira short-term goals marc cannot supplement hisbe income. This diffi should priority. — if this can beand done, whether through position with theiffire department supplement his income. This should be their first priority. if this can be done, whether through a position with the fire department or otherwise, marc and Danielle ought to be able to work toward their short- and long-term goals while allowing marc to continue or marc and to be the ableeconomy to work toward shortand long-term goals while allowing marc continue asotherwise, a real estate agent onDanielle the side.ought assuming recoverstheir from its current crisis eventually, marc may have thetooption in as a real estate agent on the side. assuming the economy recovers from its current crisis eventually, marc may have the option in the future to delve back into the real estate business full-time. the future to delve back into the real estate business full-time.

The case study presented is to illustrate products and serves available at Morgan Stanley Smith Barney. e case study presented is toa illustrate products and serves available at be Morgan Stanley Barney. TheseTh strategies do not guarantee profit or protect against loss and may not suitable for allSmith investors. Each Thcustomer’s ese strategies docnot guarantee a profi or protect loss and may not be suitable for allofinvestors. Each specifi situation, goals, andtresults mayagainst differ. Past performance is not guarantee future results. customer’s specifi situation, and results diffreview er. Pastwith performance is not guarantee of Barney future results. Investment resultsc may vary. goals, Individual clients may should their Morgan Stanley Smith Financial Investment results may Individual should review with ctheir Morgan Stanley Neither Smith Barney Financial Advisors the terms andvary. conditions andclients risks involved with specifi products or services. the information Advisors the terms and risksconstitutes involved with specific products or services. Neither thesecurity. information provided norand anyconditions opinion expressed a solicitation for the purchase or sale of any provided nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. © 2009 Morgan Stanley Smith Barney LLC Member SIPC © 2009 Morgan Stanley Smith Barney LLC Member SIPC

Jordan R. Collins Jordan Collins Second ViceR. President -

Second President WealthVice Management Wealth Management Financial Planning Specialist Financial Planning Specialist Jordan.r.collins@smithbarney.com Jordan.r.collins@smithbarney.com

Richard E. Collins, CFP Richard E. Collins, CFP Senior Vice President – Wealth Management

Morgan Stanley Smith Barney

Morgan Stanley• P: Smith Barney P: 801-947-3043 • P: 801-947-3001 866-799-4778 • F: 801-947-0699 P: 801-947-3043 •2825 P: 801-947-3001 • P:Parkway, 866-799-4778 • F: 801-947-0699 E. Cottonwood Suite 210 2825 E.Salt Cottonwood Suite 210 Lake City,Parkway, Utah 84121 Salt Lake City, Utah 84121

Senior ViceAdvisor President – Wealth Management Financial Financial Advisor Richard.e.collins@smithbarney.com Richard.e.collins@smithbarney.com UtahCEOmagazine.com

july 2009

SPOtlight

UtahCEOmagazine.com

july 2009

SPOtlight

Nicole Toomey Davis Director Centers of Excellence

AS AN ELECTRICAL ENGINEER FRESH OUT OF BRIGHAM YOUNG university in the 1980s, nicole toomey davis did not expect to go over to the “dark side” of business management, as some of her early colleagues called it. However, working on a case study with business professor and author Jim Collins on the entrepreneurial beginnings of Giro sport design’s revolutionary bicycle helmet proved to be a significant transformative moment for davis, while a stanford university mBa student in the late 1980s. “It was such a powerful impression to see that good management and leadership mattered in business,” davis says about her experience working with Collins on what would become a Harvard Business school Case study published in 1990. davis took her mBa lessons to heart when she launched doBox Inc. in 1999 with her husband Brad, a software architect whom she describes as a “technical visionary.” the company grew rapidly, providing residential software and parental control solutions for the broadband gateway industry. netopia (and later motorola) acquired the company in 2002. today, she and her husband run enclavix, a draper-based software and technology development company. davis says she and her husband surprise many people in terms of their working relationship. “We have a very strong family bond, but we’ve always been very demanding of each other when it comes to business and we’re not afraid to be blunt and open as possible,” she says. “It’s not a good idea if both partners have the same sets of skills. Our skills complement each other and that’s important.” unlike many of her fellow students at stanford, davis didn’t expect to go into public service. “It was a big left turn,” she recalls. However, in 2003, she joined key business colleagues in leading the industry push for the utah fund of funds, a matching program designed to increase the venture capital base for the state’s rapidly expanding high technology industries. today, as director of the state’s Centers of excellence program, she works on matching entrepreneurs with technologies developed by researchers in the state’s universities and providing financial seed incentives to help grow startup commercial enterprises. In utah’s thriving environment of innovation, davis sees the challenge in terms of human resources, not in technology. “We easily have scores of new technologies that come out of the universities each year,” she explains. “But entrepreneurs with energy, vision, passion and confidence are the true scarce natural resource. so often, great technologies die if they don’t have a good management team to carry it forward.”

Text by Les Roka Photo by Jed Call

UtahCEOmagazine.com

july 2009

SPOtlight

UtahCEOmagazine.com

july 2009

SPOtlight

Derald Miller Founder/CEO Westfahl Devices

DERALD MILLER WAS AN ELEMENTARY SCHOOL ENTREPRENEUR. a friend’s mom would take him and his buddies to Costco to load up on candy, which they would sell at the community pool. a few years later, miller would spend his summers atop his father’s riding lawn mower, making a cool two or three grand for the season. today, miller is at the helm of Westfahl devices, an Orem-based manufacturer of home security devices he founded in september 2005. “I’ve always been on the track that I’ve wanted to do my own thing,” he says. the devices are the type that detect when a door or window is forced open. miller was exposed to the products when he sold them door-to-door for the provo office of Virginiabased apX alarm in the summer of 2005. While there, company technicians pointed out some deficiencies that miller thought he could improve upon. Home security is not a sexy industry, but miller, who graduated from utah Valley university in 2008 with a business degree, says he was “just looking for something I knew I could do better than somebody else.” With input from the technicians who installed the devices, he made a design change involving the connecting wires. “It seems like a small change,” miller says. “But it saved them so much time.” the manufacturing aspect of the business was not foreign to miller. from september 2002 to may 2005, he worked for an Orem-based sporting goods manufacturer where he was in frequent contact with Chinese manufacturers. It was these he turned to when he began Westfahl devices. His big break — and biggest challenge — happened when an order anticipated to be for $10,000 to $15,000 of product instead came in at $400,000. suddenly, he found himself in need of $250,000 for manufacturing costs — an amount that banks were hesitant to loan to a 23-year old. With only $400 in savings, he turned to venture capitalists and was fortunate to secure funding and fulfill that order. He doubled profitability the following year, and now, just a few years later, he is running a $1.5 million company. apX is one of his largest customers, and the product line has expanded to include circuit boards and other related items. such quick growth comes from his customer service philosophy. “the most important thing is building value in any way I can” in such a price sensitive time, he says. for example, at no cost to the customer, he will store their inventory until they need it. and he will drop-ship for them for only the cost of the shipping itself. In addition to running the company, miller has been driving back and forth from utah state university to earn an mBa. “You can never have enough education,” he says, adding that it’s sort of an “insurance plan.” He is confident of continuing success, but acknowledges, “You never know what might happen to the business. You have to be as prepared as you possibly can for the future.”

Text by John Blodgett Photo by Jed Call

UtahCEOmagazine.com

july 2009

FEATURE

JUMPING THE GAAP INTO IFRS The New Accounting and what it means to American businesses. by Carl Baumeister

UtahCEOmagazine.com

july 2009

When the United States Olympic basketball team, made up mostly of NBA stars, plays Spain in an international tournament, they play by international rules, which in some ways are quite different from NBA rules. For instance, there are variances in at least 15 major rules categories, including the shape and size of the lane, playing time, goaltending, traveling and fouls. When NBA players and coaches prepare for international events such as the Olympics, a portion of their training involves learning the new rules and how to play effectively by them.

CLOSING THE

GAAP

Anticipating the adoption of IFRS, the SEC already allows foreign companies listed on American exchanges to make the switch from GAAP.

Imagine the following scenarios:

Stepping toward the inevitable switch to IFRS, the SEC has since November 2007 let foreign companies listed on American exchanges report their financial results using International Financial Reporting Standards (IFRS). Before that time, such companies had to reconcile whatever standard they reported in to that of U.S. Generally Accepted Accounting Principles (U.S. GAAP). In effect, such international companies had to prepare two accounting reports.

1. The U.S. and Spanish teams play by different rules within the same game. For instance, the U.S. has to shoot three-pointers from its familiar 23 feet 9 inches, while Spain can shoot from 20 feet 6.25 inches, but then Spain has to turn around and make the same shot from the American distance. 2. The game is played under NBA rules. After that game, another one is played under international rules.

The SEC made the move in part because of growing pressure from the American Institute of Certified Public Accountants (AICPA). On June 5 of this year, the AICPA’s IFRS website (www. ifrs.com) reported that it (the AICPA) testified before Congress in October 2007, urging that the SEC “take comprehensive steps to harmonize U.S. and international financial reporting, including allowing American public companies to report financial results using international accounting standards.”

Although this zaniness would be absurd in sports, something similar besets the accounting world. The U.S. has its own set of accounting rules — the United States Generally Accepted Accounting Principles (U.S. GAAP, or just GAAP) — while other countries have their own rules, such as UK GAAP and GAAP of Canada. Such a system has created havoc in an increasingly global monetary world, one in which companies with multinational operations often have to do fiscal reports in compliance with more than one set of accounting rules.

The next step is for the SEC to allow U.S. companies to report in IFRS. The AICPA site states, “The SEC is weighing whether to allow U.S. firms to report financial results using international financial reporting standards rather than U.S. GAAP” — a step that would effectively cut out GAAP altogether. With the U.S.’s difficulty in gaining foreign underwriting to its shaky economy, this could be a great move to facilitate easier investment in American companies. According to the website of Fulcrum Inquiry (www.fulcruminquiry. com), a financial investigations and forensic accounting firm based in Los Angeles, requirements to use GAAP might be “an impediment for foreign companies to invest in the United States, and/or participate in the U.S. capital markets. This impediment comes with little perceived benefits, as many financial analysts indicate that (i) the differences between the sets of accounting standards are becoming less pronounced, (ii) the reconciliations are information overkill, and (iii) the additional reporting comes too infrequently — only once a year.”

History

According to www.icaew.com, the site for the Institute of Chartered Accountants in England and Wales, CPA organizations from Britain, Canada and the U.S. began in 1966 exploring ways to converge international accounting standards. The following year, the Accountants International Study Group (AISG) was formed, providing information regarding the issues and practices of international accounting. In June 1973, the International Accounting Standards Committee (IASC) was born. Its mission was the “rapid acceptance and implementation world-wide” of an international accounting standard. From 1983 to 2000, they published 41

UtahCEOmagazine.com

— CB

july 2009

FEATURE

standards of international accounting. In 2001, the group was restructured to be the current International Accounting Standards Board (IASB). In 2000, the Securities and Exchange Commission (SEC) began exploring the ideas fostered by the IASC. Within a few years, a growing movement supported International Financial Reporting Standards (IFRS). By 2005, all countries of the European Union were required to use IFRS. Now, more than 115 countries use it in varying degrees, including Arab states, Australia, Malaysia, New Zealand, Pakistan, Russia, South Africa, Singapore and Turkey.

might catch those things.” Similarly, Illiano likes IFRS because “with fewer rules and more principles, it allows for smart people to make choices that reflect the economic realities.”

Fewer business obstacles

The clearest advantage of IFRS for Utah and other U.S. companies is in international business. Currently, if an American company has interests in an IFRS country, accounting often has to be conducted in two different accounting systems. This not only adds confusion — it adds significant costs; it could be quite costly, especially in cross-border mergers and acquisitions. Kennedy cites an example of the current system. “A Utah company is buying a French company. They say, ‘Okay French company, you’re doing your books under IFRS. We have to pay significant fees to convert the books to U.S. GAAP.’ After the switch to IFRS, lots of money will be saved, which can stimulate the economy.” Illiano indicates that the savings will be beneficial to “both companies and countries.”

Playing politics

The movement to replace GAAP has been spearheaded by the SEC. Former SEC Chair Christopher Cox, a Bush appointee, was “full speed ahead on this,” in the words of Gary Illiano, national partnerin-charge of international and domestic accounting for Grant Thornton. However, Illiano indicates that Mary Schapiro, the new Obama appointee to head the SEC, has “distanced herself ” from Cox’s enthusiasm, which has “translated into slower movement.” Illiano, a supporter of the move to IFRS, is not worried. “They [Schapiro’s actions] are unfortunate, but not surprising, and not insurmountable.”

The clearest advantage of IFRS for Utah and other U.S. companies is in international business. Currently, if an American company has interests in an IFRS country, accounting often has to be “Banking Lawyers Employment Act” Illiano cautions that conducted in two different opponents will argue on behalf accounting systems. This not of higher front-end costs as American companies convert Fewer hiding places Alex Kennedy, a partner at Salt only adds confusion — it adds from GAAP to IFRS, with much of that cost going to Lake City law firm Jones Waldo pay accountants. “However,” Holbrook & McDonough and an significant costs. he says, “the long-term will see great savings. Companies will no longer have to keep current and report in two accounting languages.” Kennedy jokes that, short term, the conversion can be called “The Banking Lawyers Employment Act,” because attorneys will be quite busy during the conversion process. One scenario he uses is of a company that has borrowed money from a bank. “That company has certain debt covenants with the bank. Now the company has switched to IFRS, and could actually find itself in violation with the bank, and will have to hire a law firm to unravel and fix the problem.”

expert in M&A and in securities law, comments that the switch will cause some discomfort in business circles. “U.S. GAAP is the gold standard of accounting. There are thousands and thousands of pages [more than 30,000 pages, according to Illiano] to which accountants and lawyers can refer. IFRS is based more on the ‘spirit of the law,’ being principles-based rather than rules-based. It fits into one volume.” Although a principles approach might create more ambiguity, there are fewer rules and loopholes to hide behind. Kennedy points out, “Enron was hiding debt using GAAP. Their accountants were following GAAP rules and were technically legal. The IFRS system

UtahCEOmagazine.com

july 2009

IFRS is based more on the ‘spirit of the law,’ being principles-based rather than rules-based … Enron was hiding debt using GAAP. Their accountants were following GAAP rules and were technically legal. The IFRS system might catch those things.” — alex Kennedy, Jones Waldo Holbrook & mcdonough

Writers Sarah Johnson and Marie Leone for CFO.com report that “executives are worried about the cost of conversion.” Further, they cite that “James Campbell, corporate controller at Intel, estimated an IFRS conversion would cost his company $50 million, prompting him to ask the SEC to study the issue more thoroughly before issuing a mandate.”

Better start learning … and keep learning Dr. Marlene Plumlee, associate professor of accounting at the University of Utah, wagers that although right now, IFRS is about one-tenth the length of GAAP, “I would bet that in 10 years, it will look more like GAAP. IFRS is so new right now, like a new car without any dings.” Yet she

cautions Utah businesses to remain calm. “People are worried because balance sheets will look different. Some of my students get worried just hearing ‘IFRS.’ But accounting isn’t hard. Just jump in and start learning.”

Timeline

Sentiment among most experts is that the U.S. move to IFRS is inevitable. Illiano points out that in addition to the 115plus countries already using it, “by 2011, we’ll have significant countries already converted. Japan, the second-largest economy in the world, Canada, our largest trading partner, and India all will be on IFRS. Most of the world has said they’re not moving to U.S. GAAP. We won’t be able to sit at the table for long.” Under Chairman Cox, the SEC was in line to require publicly traded American companies to convert completely by 2016. Johnson and Leone have indicated that current chair Schapiro, in addition to having cost concerns, has “reservations about the independence of the overseas standards-setter that writes IFRS and the quality of the rules themselves.”

Respecting People. Impacting Business. SM

Good people with proven skills. Working with Express can save you time, money and energy because we work hard at recruiting talent every day. We realize that when it comes to office work, you either have skills or you don’t. More thoroughly than other staffing providers, Express tests workers’ skills before we send them to you. We take extra time to interview and prequalify candidates to our own high standards. So when you call, we have the right people. Call one of our locations to experience the Express difference.

Six locations across Utah to serve you! (435) 586-9084 Cedar City

(801) 728-3228 Clearfield

(801) 374-9300 Orem

(435) 674-1110 Saint George

(801) 290-1721 Salt Lake City East

(801) 255-1441 Salt Lake City West

www.expresspros.com

UtahCEOmagazine.com

July 2009

FEATURE

HEALING THE HEART OF

HEALTH CARE The potential impact of federal and state legislation on health care and coverage. by Brian Staker

The economic recession and volatile business environment have sent health care costs skyward, forcing businesses to look for new methods to keep costs under control. It isn’t easy, especially because recent legislative actions on both the federal and state levels are changing the health coverage landscape as well. It becomes increasingly complicated for employers trying to keep health care costs down while still providing a quality health benefit plan and adhering to regulations. Linda Havlin, global intellectual capital leader for Mercer Health & Benefits, a global consulting, outsourcing and investment firm, has found that health costs in previous recessions were elevated by stressrelated illnesses and laid-off workers that continued to use benefits while they were still covered. Her surveys found that immediately following that spike, however, costs declined as employers enacted cost-

UtahCEOmagazine.com

cutting measures, like shifting costs to employees, and most expect to bring the 2010 increase in health care cost down to 5.2 percent, the lowest increase since 1997, according to Mercer. But that’s just a temporary fix for a problem that is steadily worsening. Compared to just nine years ago, the amount Utah employers are paying for employee health care has increased 100 percent. “Simple cost shifting won’t be the silver bullet this time around,” says Havlin. “Many employers are considering a consumer-directed health plan.”

State of the stimulus

Government actions have added to the elements that employers must consider. The American Recovery and Reinvestment Act of 2009, better known as the “Stimulus Bill” signed by President Obama on February 17, will profoundly affect many different industries, but none more than healthcare.

july 2009

HEALTHY WORKSITES

The effects of the Stimulus Bill on the health care industry come under five separate provisions of the bill: Research on the comparative effectiveness of health care treatment and services, extending the reach of HIPAA, the Health Information Technology for Economic and Clinical Health Act (HITECH Act), Medicare System provisions, and Medicaid provisions. “The most immediate impact [of the Stimulus] to employers is the increased number of potential COBRA participants,” says Ann Thomas, principal in Mercer’s Salt Lake office. “In response, employers’ strategies to mitigate costs will depend on what options remain viable pending proposed legislation.” Rob Tweed, clinical director for Davis Surgical Center in Layton, notes that electronic recordskeeping provisioned in HITECH will require an initial cost for switchover, hardware and software, but afterwards will save money, and is a measure his company was planning to implement anyway.

RESOURCES FOR EMPLOYERS The Utah Department of Health offers a number of resources to help employers promote better employee health. UTAH DEPARTMENT OF HEALTH WORKSITE TOOLKIT How to start a worksite health program, identify target areas and improve areas of concern. health.utah.gov/worksitewellness/pdfs/Worksite_Toolkit.pdf HEART CHECK Assessing worksite support for a heart-healthy lifestyle. www.health.state.ny.us/nysdoh/heart/healthy/heartcheck.pdf INSURANCE EVALUATION Centers for Disease Control and Prevention checklist Helps analyze your insurance benefits concerning heart disease and stroke, and negotiate benefits for employees. health.utah.gov/hearthighway/pdfs/Insurance_Health_Plan_ Checklist.pdf

Local acts

In addition, Utah Gov. Jon Huntsman earlier this year signed into law four bills that affect employers’ health care costs. HB 165 simplifies administrative functions such as billing and authorizations. HB 188 creates a defined contribution market in which employees can choose a guaranteed issue plan with pre-tax dollars, expands the role of the Internet portal for access to health care information, increases the transparency of the marketplace, creates the lower-cost NetCare health benefit plan as an alternative to COBRA, and reauthorizes the Health System Reform Task Force. The Salt Lake Chamber’s Director of Public Policy Wesley Smith applauds HB 188, saying, “The defined contribution system allows families to aggregate contributions from multiple employers. It allows businesses to control the spiraling premium costs and still provide a benefit instead of being priced out of the market.” He also finds that the Internet portal and transparency provisions will “empower consumers to make better decisions.” HB 331 creates a level playing field for contractors bidding for state projects, no longer offering an advantage to those not providing health insurance for employees, and penalizing those who don’t offer health coverage for employees through the duration of the contract. SB 79 addresses tort reform for emergency room malpractice cases, establishing a standard of proof based on clear and convincing evidence.

UTAH COUNCIL FOR WORKSITE HEALTH PROMOTION A group of employers, health insurance representatives and health professionals working to improve employee health. health.utah.gov/worksitewellness WELLNESS COUNCILS OF AMERICA Free resources about worksite wellness, employee needs assessments, how to start a wellness council and more. www.welcoa.org EMPLOYER RESOURCE GUIDE Utah Department of Health’s Bureau of Health Promotion guide to information and resources for developing a wellness program. health.utah.gov/hearthighway/pdfs/EmployerResource.pdf CDC HEALTHIER WORKSITE INITIATIVE Though designed for state and federal government, it also has ideas for health promotion in non-governmental workplaces. www.cdc.gov/nccdphp/dnpa/hwi/index.htm UNIVERSITY OF UTAH’S NUTRITION CLINIC Nutrition resources including presentations, classes and health screenings: healthcare.utah.edu/nutritionclinic/corporate/index.html

Consumers in control

The most generalized effect of all these changes is to put more control of the health benefit in the hands of the consumer. Locally, the widest-reaching change is the establishment of a new defined contribution market for health insurance, comparable to the movement from a UtahCEOmagazine.com

july 2009

FEATURE

defined pension program for retirement to a retirement the health benefits packages of many businesses. Dr. plan including contributions to a retirement account Matthew Hughes, deputy director of the University like a 401(k). Instead of providing health coverage, of Utah’s Rocky Mountain Center for Occupational the employer’s responsibility will be to give employees and Environmental Health, notes that the trathe funds to purchase their own coverage. “In some ditional means of containing health care costs by circumstances Consumer Directed Health Plans (CDHP) adjusting health coverage and looking for discounts are better accepted by employees than traditional plan from providers has reached a point of diminishing designs,” Thomas says. “The effect appears to be highly returns. “These strategies have been successful to a correlated to the plan design, purpose, and rollout.” point, but most have reached their maximal return,” Norman Thurston, health policy reform initiative he says. “Companies must now move beyond coordinator of the Utah Department of Heath, notes these techniques and adopt a more comprehensive that the number of Utah employers offering health strategy to reducing the costs of employment related insurance has held steady at 44 percent since 2005. It’s to poor health, not just health care alone.” He adds a steep decline from 57 percent just over a decade ago in that 38 percent of medical and pharmacy costs, 1998, a decline that is sharper 29 percent of absenteeism, than that in any other state. 41 percent of short-term According to the University disability and 24 percent of of Utah’s Public Policy workers compensation costs Administration, 12 percent of are attributable to employees Utah residents have no health with medium to high health risk coverage, and Thurston says, factors. “When people don’t have Wellness programs are as insurance, inevitably it impacts varied as the companies that use the ability of the system to them. MGIS Companies is one provide effective and efficient of the state’s Work/Life awardhealth care.” The bottom line winners this year. The health is, if your employees don’t benefits management firm — Linda Havlin, mercer Health & Benefits have the means to stay healthy, offers alternative treatments they can’t stay at their most including reiki, chiropractic and productive. acupuncture. A fitness consultant visits the on-site Some employers have tried to contain costs by using wellness room to give employees a benchmark to shortsighted methods like cutting benefits, raising work from and set realistic fitness goals, and the deductibles or shifting the cost of premiums toward the company also sponsors a fitness contest. Smoking employee — the most preferred method. While these may cessation is also a priority. Chief Operating Officer provide short-term relief, they don’t solve the problem Todd Orullian notes, “Employees who stick with a long-term, because they can be instituted only so often fitness or weight loss program are reimbursed 50 and so deeply until employees would eventually foot the percent of the cost.” entire bill. CHG Healthcare Services, a national health care staffing firm and another Work/Life awardwinner for its Salt Lake office, focuses on emotional Wellness programs and financial wellbeing as well as physical health, In addition to making adjustments to their health according to Kevin Ricklefs, vice president of care benefits, more and more businesses are introducing administration. In addition to their Employee wellness programs to combat the rising cost of providing Assistance Program and retirement planning, health coverage. A wellness program structured around the company conducts wellness fairs and yearly the specific needs of your company can bear the fruits weight loss contests with prizes. “Last year we lost of decreased health care costs and absenteeism and 2,700 pounds overall,” he says. The high employee increased productivity. The Wellness Councils of America, participation rate is paying off. “Against an average a worksite wellness promotion company based in Omaha, premium increase of 11 percent, we’ve been able to Neb., has found that companies they studied have netted decrease ours 3 percent.” as much as $3.40 for every dollar spent on wellness. Sue Johnson, president of Futura Industries, an Wellness promotion is increasingly seen as essential to

Simple cost shifting won’t be the silver bullet this time around. Many employers are considering a consumerdirected health plan.”

UtahCEOmagazine.com

july 2009

NON-PROFIT

If you are a fan of Unity then you are already a fan of Special Olympics. UTAH NONPROFITS ASSOCIATION

Donate, volunteer, coach or compete. WWW.SOUT.ORG

Your contributions help our scientists and doctors perform research and clinical studies finding better ways to prevent, Three Reasons to Give: detect, andCancer treat working with Huntsman Institute,common including 2007 Nobel Prize 1 Scientists winner Mario Capecchi, PhD, are internationally renowned for their breakthroughs in transgenic research. and rare cancers in adults. Cancer Institute houses and manages the largest, most comprehensive 2 Huntsman genetics database in the world, and more inherited cancer susceptibility genes have

Please make your donation to

been identified by our scientists than at any other cancer research institute.

HUNTSMAN CANCER FOUNDATION

Cancer Hospital ranked in the top 1% of hospitals in the nation for 3 Huntsman cancer care in 2007 by U.S. News and World Report.

Your contributions will help our scientists and doctors perform research and clinical studies to find better ways to prevent, detect, and treat both common and rare cancers in adults. They share these research findings with scientists throughout the world. Your gift to Huntsman Cancer Institute benefits cancer research everywhere.

today on our website: Please make your donation to Huntsman Cancer Foundation today at our website: www.huntsmancancerfoundation.org www.huntsmancancerfoundation.org. To learn more about the many giving opportunities available, call 1-877-585-0303.

A reason to hope

huntsmancancerfoundation.org

1-877-585-0303 801.584.5800

Whether it be program sponsorship, underwriting promotional literature, cause-related marketing, employee involvement or event sponsorship, these partnerships provide effective ways to link your corporation with the

CANCER WELLNESS HOUSE and the vital mission of providing social and emotional support to Utah men, women and children living with cancer and their families in a home-like setting. To learn more contact Katie Porter at 801-236-2294 or Katie@cancer-wellness.org.

UTAH NONPROFITS ASSOCIATION

“STRENGTHENING ORGANIZATIONS THAT STRENGTHEN OUR COMMUNITY” THANK YOU FOR YOUR SUPPORT OF NONPROFITS IN UTAH.

UNA REINFORCES THAT INVESTMENT! Call (801) 596-1800 For more information. www.utahnonprofits.org

The UTNG Charitable Trust disburses funds to Guard families to offset financial hardships incurred during deployments. The Trust operates with less than one percent of donations used for administrative costs. Donate to the Trust and help the Soldiers and Airmen who protect our freedom.

Utah National Guard Charitable Trust 12953 S. Minuteman Drive, Draper, Utah 84020

801-432-4544

CEO AD.indd 1

6/18/2009 9:41:31 AM

interventions designed to address issues like obesity, aluminum extrusion company based in Clearfield, added smoking and pre-diabetic conditions; and continued an on-site clinic with a full-time physician two years monitoring. “Some companies have flatlined their increase ago to eliminate waste and make it more convenient for in claims paid from an 11 percent average,” he says. employees to obtain care. The clinic has helped decrease The Rocky Mountain Center for Occupational and the company’s medical loss ratio (claims paid as a Environmental Health’s Utah percentage of premiums) by Health Promotion Center 62 percent. Although Futura helps to create collaboration promotes wellness, Johnson between business, trades, says wellness programs don’t employees, government, always address the problem healthcare, health insurers, of managing chronic illness, workers compensation and which she says is the biggest community groups to test lever for reducing health theories of health promotion, care costs. “Our doctor has develop new knowledge of the uncovered chronic diseases most efficacious programs, people didn’t know they had,” implement and evaluate new she explains. Early treatment, as well as Futura’s own — dr. matthew Hughes, university of utah’s rocky mountain health promotion programs, and promote and publicize electronic records system and Center for Occupational and environmental Health the most efficient strategies a rebate negotiated with their to help businesses reduce the insurance carrier based on the costs related to poor health. “The latest thinking is not attractive loss ratio, have kept its health care costs low just focused on healthcare, but productivity,” says Dr. while still affording a quality environment that has made Hughes. them a multiple-year Work/Life winner. As with many investments, the most substantial A new industry has emerged in recent years, with returns of promoting workplace wellness often aren’t the appearance of consulting firms that help companies seen until farther down the road. Ann Thomas, principal design wellness programs that best meet the needs at the Salt Lake office of Mercer Health & Benefits, says of their employees and the bottom line. Kersh Risk that the impact of wellness plans is the subject of ongoing Management, a wellness and risk management company research. “Current studies indicate favorable returns for based in Russellville, Ark., is helping organizations well-designed and implemented wellness programs. The address one “root cause” of health care costs: health return on investment is often delayed and has a more risk factors. Rick Stapp, vice president of sales and dramatic effect on health care costs in future years.” marketing in the company’s Provo office, says they utilize a three-phase process: individual health assessments;

Companies must now … adopt a more comprehensive strategy to reducing the costs of employment related to poor health, not just health care alone.”

UtahCEOmagazine.com

july 2009

Don’t gamble with your ideas...

IP LAW GROUP

Lit

BATEMAN

Patent Trademasrks Copyrighets r ts e Sec on Trad igati

Stack the deck in your favor. www.batemanip.com

Salt Lake Office: 8 East Broadway, Suite 550 Salt Lake City, UT (801) 533-0320 Utah County Office: 1329 South 800 East, Suite 240 Orem, UT (801) 655-0016

UTAH CEO CASE STUDY

Driving for Digital Dollars by Thad Kelling

Utah’s auto dealers are finding success with aggressive online advertising. Here’s how they do it and what you should know.

It’s no mystery As more consumers get information online, more businesses are sinking additional resources into online advertising. But what’s less certain is how best to attract netizens who are already beyond information overload. The questions compound from that point: Where do you advertise online? How much do you spend? How will you capture leads and follow up on them? How will you track your success? These are questions that every executive is asking — especially in a slow economy, when marketing budgets are on the chopping block. To find answers to these questions, you need not look further than Utah’s auto industry. This group has turned to the Internet in a big way in recent years, and is finding notable success. And even though some dealerships are cutting traditional media advertising, their online budgets are growing.

report; they just want information — and a lot of it. “Internet shoppers are typically a different type of shopper,” says Jon Wallace, the Internet director at Murdock Chevrolet. “They need to be treated differently. A lot of them are in the looking stages. A lot of them don’t understand quite what they are looking for.”

Versus traditional media Few qualities of online advertising are more appealing than the value. Not only are rates lower than for traditional media (TV, print, radio), auto dealerships report a higher return on investment for online ads. In simple terms, they are getting more Here’s how they’re doing it, why they do it and what you leads for every dollar of online should do to get similar results: advertising than for those spent on traditional media. Why online? This value has compelled Menlove Consumers are shopping Toyota, for example, to grow its online online. You don’t need any more advertising budget while cutting reason than that to advertise on TV advertising. Online advertising the Web. This is increasingly true accounted for about 40 percent of its for Utah auto dealers. They say the advertising budget in April and May, vast majority of people looking for according to Chad Rollings, director of cars look online first. sales. “In general, online advertising is “I would guess that if you more cost effective, but we are seeing surveyed, seven out of 10 people — Chad rollings, director of sales, menlove toyota enough play from the print ads that we look for used cars online before continue to do it,” he says. they go shopping,” says John Murdock Chevrolet spends a much smaller percentage of Adams, Internet manager for Jody Wilkinson Acura. This is a its marketing budget online — only $7,000 of its $100,000 huge time-saver for consumers, he adds; it used to take an entire monthly budget. However, they report substantial success Saturday to look for a new ride. from their online advertising. “Internet ads probably Yet, as shoppers have moved online, their behavior has generate 70 percent of sales,” Wallace says. changed. They generally don’t want to be pushed, the auto dealers

No matter what media you are using to drive your traffic, the biggest thing that any business needs to make sure they do is have the right leadresponse system in place.”

UtahCEOmagazine.com

july 2009

Has the bubble burst for your company? If so, will you have the right people in place to come back Has the bubble burst for stronger than ever? your company? You may not have control over the amount of turmoil in today’s economy but

If so, will you have there are things in your company you the right people in place can control in response to this volatility. to come back Chief among them is the ability to identify stronger than ever? and retain key employees – and to keep these people engaged and motivated You may not have control over the so that productivity remains high. amount of turmoil in today’s economy but thereThere’s are things in yourfor company no margin error. you can control in response to this volatility. And there’s no time to waste. Chief among them is the ability to identify and retain key employees – and to keep these people engaged and motivated so that productivity remains high. There’s no margin for error. And there’s no time to waste.

IT’S TIME TO CALL MERCER IT’S TIME TO CALL MERCER For Information Contact

NICOLE COZZO

15 W. South Temple Suite 700 Salt Lake City, UT 84101 (801) 533-3635 Nicole.Cozzo@mercer.com

www.timetocallmercer.com

For Information Contact

NICOLE COZZO

15 W. South Temple Suite 700 Salt Lake City, UT 84101 (801) 533-3635

www.timetocallmercer.com

10 TERMS you should know

1. Ad rotation — The rotation of

ads based on a predefined list. This is done by using software or by a site administrator. Ads sometimes rotate throughout a network of websites.

Afﬁliate marketing — When a website sells products or services for another company, known as the affiliate. (Amazon.com runs one of the world’s largest affiliate marketing services.)

3. Click-stream — The path a

viewer follows when viewing a website. Statistics allow administrators to track where viewers come from and in what order they view the website’s pages.

Click-through — When a visitor clicks on your ad. Some media outlets allow payment based on click-through.

5. CPM — “Cost per thousand” ad impressions. (The “M” stands for the Roman numeral for 1,000.)

6. Geo-targeting — Allows you

to target views based on the visitor’s geographic location. This is especially important for small or regional businesses.

7. Opt-in e-mail — When a

consumer requests (or opts-in) to receive an e-mail notification from an advertiser or news organization. Lists of these people are often bought and sold.

Run-of-site — An ad that is placed in a rotation so that it appears throughout a website instead of in a specific spot. Ad rates for run-of-site ads are typically less than for a featured placement.

9. Keyword targeting — When

an ad is displayed based on words that appear on a webpage. Advertisers can often choose multiple keywords when this is available.

10. Wallpaper ad — An ad

that changes the background of the webpage. (Pandora.com frequently uses these ads.)

— TK

Weighing options Once you commit, the hard work begins — deciding where to advertise online, what your ads will look like and what they will do. There are dozens of options — banner ads, wallpaper ads, listings, video, run-of-site, registration, Flash animation and featured placement are just a few of them. Rollings likes to start his online ad campaigns by asking a number of questions: Who are we marketing to? Why is there traffic on the website being considered? How will the vendor place our ads? Who will create the ads? To help answer these questions, Rollings focuses on demographics. Website traffic tends to be more fragmented than traditional media, so it’s important to pin down where your target customers are finding information. “Pay attention to where they play,” Rollings says. Auto dealerships use banner ads on major news websites and list their vehicles on every classified website possible (including Cars.com, AutoTrader.com, KSL.com, etc.). They try to be everywhere, because they never know where their customers will be surfing.

think that you can put the same ad on a website and keep it there for months. New and unique ads drive attention and revenue. Manage your time Time limitations probably create the biggest frustration with online advertising. It’s easy to place umpteen ads across the Net, but it’s difficult to respond to all the messages from customers and track the effectiveness of your marketing campaign. Wallace spends most of his waking hours managing online correspondence and data. It takes a lot of time to upload all the listings and ads. And it takes a lot more to respond to all the virtual leads — especially when you try to respond within 2 minutes like Murdoch Chevrolet does. “You have to respond to every single customer as quickly as possible,” Wallace says. “It takes an insane amount of time and effort. I work probably 12 to 18 hours a day.”

Converting leads Attracting consumers to your website is one thing; converting them into sales is another. It’s crucial to have a mechanism in place to respond to customer queries and, ultimately, drive them into the store. “In my years of experience,” Rollings Quality matters says, “no matter what media you are using Don’t forget quality. Adams suggests that quality ads are just as important online to drive your traffic, the biggest thing that — especially your photos. “I think the most any business needs to make sure they do is have the right lead-response system in important thing is to have good pictures,” place.” he says. “People that list things without Adams, for example, uses Contact pictures are just wasting their time. People at Once. This software allows you to chat buy out of emotion.” to customers the second they land on To ensure that their photos are good, your website. “A lot of people search on they hired Orem-based Platinum Dealer the Web,” Adams says, “but they like the Services to take pictures of each of their personal touch of talking to a human vehicles and upload them to the Internet. Many industries have vendors that provide being.” this service. On top of quality ads, Adams suggests What the future holds Now what? Will online ads replace that you pay extra for featured placement. those in traditional media? That depends On car listing websites, for example, on where your audience goes, according to shoppers are confronted with hundreds Rollings: “The market will dictate. We will of products. But, if you pay extra, you play in the sandbox that the customers want can have your listings show up first when us to.” In the meantime, it couldn’t hurt to customers search. “Pay the money to be in get familiar with online advertising. their face,” Adams says. And freshness counts, he adds. Don’t

UtahCEOmagazine.com

july 2009

The All-New

NISSAN Z With it’s staggering 322 horsepower, the world’s first SynchroRev Match manual transmission* and finely crafted interior, every detail only makes you want it more.

Text “Dahle 2930486” to 48696 to test drive this vehicle on your phone!

Tim Dahle Nissan

4528 S. State Street, Murray, Utah 84107 801-262-5521 • www.timdahle.com *Available on the sport package. Always wear your seatbelt and please don’t drink and drive. Nissan, the Nissan Brand Symbol, “SHIFT_” tagline and Nissan model names are Nissan trademarks.

W E a lt h m a n a g E m E n t About this article: This column is intended to provide guidance for individuals as they navigate the path of personal wealth management.

DEFINE YOUR RETIREMENT

Report by: The Insight Group Inc., A Registered Investment Advisory Corporation

When it comes to planning your retirement, one plan does not fit all.

Does one size, color or style ﬁt all? Do you recall the childhood experience of receiving a piece of hand-me-down clothing? Do you remember putting on that dress that was just the wrong color, the shirt that had sleeves that were too short or the sweater that seemed to have an extra 5 yards of yarn in its stretched and sagging torso? Maybe you recall a parent saying, “But your sister loved that sweater and she looked so cute when she wore it.” One would think that we live in a world where one size (color, style) fits all. In the popular financial press these days, it is easy to find a simplified “one-size-fits-all” approach to retirement. A common tack is to save to a specified target investment amount, let’s say, $1 million. Then invest this amount in a well-diversified portfolio. Take annual distributions from your investment portfolio at a 4 percent annual rate and voilà, your money will last as long as you live and you have a safe and secure retirement. Although this approach has some valid elements, following this approach is likely to lead to failure. Retirement is a common goal with uncommon outcomes. Achieving a successful retirement is as unique an experience as two people are different in appearance, desires and status. Let’s look at a specific scenario: John works for a large company. He has prepared for retirement by investing in the company 401(k) plan making maximum contributions for many years. He has been granted non-qualified stock options and these options will continue to vest into retirement. His investment portfolio outside of the 401(k) plan represents only a small percentage of his investment portfolio. He will receive a small company pension and hopes that he doesn’t have to rely on Social Security to meet his expected lifestyle needs during retirement. He and his spouse would like to have a worry-free retirement that includes traveling and enjoying the good life. They don’t want to take too much risk with their investment portfolio and they would like to have something left to give to their grandkids.

Retirement is a common goal with uncommon outcomes. UtahCEOmagazine.com

What is retirement? Deﬁning the goal. Defining retirement is more than targeting a specified level of income. What if John lives to age 100 or beyond? What if he experiences a life-changing medical event? What if he needs Social Security in retirement and it is not available? What if the tax laws change? What if a family member needs financial help? What if an expected future cash flow, such as an inheritance, is less than expected? Each individual has to

july 2009

W E a lt h m a n a g E m E n t

determine what potential income and expense events might occur during retirement. Modeling and stress testing these scenarios must take place.

Goals-based investing — How much risk do I take? Assessing risk tolerance is the next step in determining portfolio allocation. Risk tolerance can be measured on multiple levels. One view of risk is to determine what the required rate of return is to meet your goal, while taking the minimum amount of risk. For example, if I model my income and expenses for my retirement, my required rate of return may be 5 percent and I may be able to earn that return while only incurring 30 percent of the volatility associated with the general market. These measures of risk are driven by market assumptions and expected income and expense events during retirement. Many of these risk/return trade-offs are built around market analytics. Another measure of risk of equal or greater importance is risk personality. This is determined by answers to questions regarding what you would do in certain circumstances. For example, if you were working for a company and had the option to be paid commission, commission and salary, or only salary, which option would you choose? If you could choose between a variable or fixed rate of interest on a home mortgage, which would you pick? Or if you experienced a 10 percent decline in your portfolio would you immediately change your investment model or would you ride it out? By answering a series of questions such as this, you can determine what your behavioral response will be to different market conditions. Only after you determine your risk tolerance — both from a market analytics perspective and from a personality perspective — can you correctly design your goals based portfolio allocation.

How did John do? John assessed his anticipated expenses for retirement. Even though inflation has historically averaged 3.5 percent, he chose to use a 4 percent inflation assumption. He decided that even though he doesn’t want to rely on Social Security, he would assume that he would receive at least half of the current projected Social Security benefit. He modeled a contingency fund for unexpected health events. He established a schedule of stock option exercises to create

a portfolio outside of his retirement assets to give him more tax flexibility. After stress testing the model based on market risk measures and his risk personality, he found that his target rate of return was 5 percent. While this did not guarantee the success of his retirement plan, he had a high probability of actually meeting his retirement goals.

Standing on solid ground The next step is to measure your performance and risk exposure relative to your objectives. Make modifications in the allocation based on maximizing the potential of achieving your goals. For many, the result of this process is the recognition that to achieve your desired outcomes, you may take more or less risk than originally thought, but with a greater likelihood of achieving your goals. Action items... • Determine your goals. Quantify them as best you can. • Determine the resources available to meet each desired outcome. • Determine your risk personality and how this may affect your asset allocation. • Segregate your assets into pools that will be used to fund each goal. • Stress test each goal to better determine required returns. • Ensure that your portfolio has an appropriate level of diversification. • Consider modifying your goals if the required return is too high (e.g., work longer and retire later). • Regularly review your investment performance relative to your desired outcome.

Don’t wear your sister’s sweater Everyone has unique dreams, goals and objectives. One size does not fit all. Rather than basing your return on chasing the market, determine what you want to accomplish. This will determine your required rate of return in the context of your goals. Build your portfolio and asset allocation so that it will be driven by your target outcomes. The result will be a more successful and balanced investment approach that will keep you focused on achieving your goals.

The Insight Group is a team of financial planning professionals that enable affluent families across the Wasatch Front (and the backside, too) to navigate the impact of wealth-transforming events. Planning for these events, whether driven by retirement, a business sale, death, inheritance or market conditions, will maximize the positive impact of wealth for your family and community. The Insight Group … achieving financial wellness for yourself, your family and your community.

Jane A. Rogers 3115 East Lion Lane, Suite 100 Salt Lake City, Utah 84121 p. 801-944-7702 f. 801-944-7708 jane@insightgroup.com UtahCEOmagazine.com

july 2009

Easy. Fresh. Professional. Delivering Paradise to your doorstep has never been easier with our customized catering service. Bakery fresh sandwiches, wraps, soups and salads – even breakfast treats –- are the perfect choice for your office or home. Made from scratch daily, we serve the finest selections. Paradise team members deliver each order with care and set up the food presentation on-site to make sure that yourneeds are met.

Receive 10% Off Catering Order. Minimum order of $50, excluding tax. Not valid with any other offer. Please mention this coupon when ordering.

View our menu at www.paradisebakery.com

“The only reason we exist is that we’re intense about being the best. We’re very organized and we’re all about efficiency. Our guys are tenaciously aggressive, and we’re all working very hard.” Michael Pratt, , Founder and CEO

OGIO

I am a

corporate fitneSS and worker unity

SpeCiAL iSSue: 2009 in preview

PROTECT AGAINST SECURITIES FRAUD

WRITE A BETTER ANNUAL REPORT

12. 2008

SURVIVE THE RECESSION

MOTIVATE YOUR SALES FORCE

1.2009

UNCOVERING SALES OPPORTUNITIES

2.2009

ZIONS BANK LENDS A HAND

3.2009

NAVIGATE the

RECESSION Insight and analysis to help outlast the downturn

expert territory Silicon Slopes seeks the greatest tech minds on earth

{

PLUS

It’s a no-compromise solution.You don’t have to be one or the other — either a capitalist or a Mother Teresa.”

2008

THE YEAR IN REVIEW finding cash when StrApped full-time job, pArt-tiMe MBA Software that GetS the JoB done the $700 billion BAiLout And you caution flag for the 2009 eConoMy

{

PLUS

LEADERSHIP INFLUENCING OTHERS TO FOLLOW

PRESERVE managerial knowledge ANTICIPATE Utah's legislative session BACK UP business data now — not later

PLUS

{

ATTRACT executive talent to Utah BALANCE innovation and efficiency PROTECT corporate assets

www.UtahCEOmagazine.com

CAPITALISTS for

CHANGE Teaming up with

COMPETITORS UNPROFITABLE

CUSTOMERS

what happened on capitol hill

motorcycle mini-guide

INTELLECTUAL PROPERTY

MERGERS AND ACQUISITIONS

4.2009

STATE of

OPPORTUNITY

Utah's economic development doesn't stop with the recession Economic development over the past several years has provided our state with a strong base to work from. We are well-positioned as a state, with a diverse economy that will help put us in a better position for recovery from the economic downturn.”

Soften the blow of

letting go

BEING PREPARED

Disaster readiness is vital for your business to survive

The public needs to know two things: We've got a steady hand on the steering wheel, and the guy driving the bus here is well-prepared, probably as well as anybody who has ever come to this office."

Novell, WordPerfect and

THE BIRTH OF UTAH'S

Negotiate, mediate, or arbitrate

TECH SECTOR

Buck the economy Go Global

EXIT THE RECESSION

Just don't litigate

READY TO

LEAD

How Lt. Gov. Gary Herbert might influence Utah's economic development.

with a plan

PLUS:

How Web Tools Help Businesses Preserving Human Capital Legal Ease

The National Children’s Study is coming to your community. This landmark study will find answers to childhood problems like asthma, autism, obesity and diabetes and will help the health of children for generations to come. Thousands will participate. Millions will benefit. You could be the answer that changes the world.

To learn more about the National Children’s Study in Salt Lake County, please visit SaltLake.NationalChildrensStudy.gov

lEgal EaSE

BEWARE THE UNLICENSED

BROKER-DEALER YOU COULD BE IN VIOLATION OF THE UTAH UNIFORM SECURITIES ACT AND NOT KNOW IT.

Have you hired an unlicensed broker-dealer without knowing it? If you’ve hired a business broker to sell your business or paid fees to a “finder” for helping you with financing efforts, you and the person you paid may have violated Utah’s securities laws. A violation may not only subject you to an enforcement action by the Utah Division of Securities, but may also give the purchaser or investor a right to rescind the transaction. The business broker issue will catch many by surprise. In May, the Securities Division circulated a letter to Utah business brokers and securities attorneys. The letter claimed that many business brokers in Utah — who typically are not licensed as broker-dealers — were offering and performing services that would require them to be licensed as brokerdealers under the Utah Uniform Securities Act. Under the Act, a brokerdealer includes “any person engaged in the business of effecting transactions in securities…” The Securities Division takes the position that any business broker offering services such as “investment banking,” “mergers and acquisitions” or “fund-raising” is engaging in activities that would be “difficult, if not impossible to conduct without being deemed a brokerdealer.” The most common scenario is when a business broker is hired to sell 100 percent of a small business. If the transaction is structured as an asset sale, no broker-dealer problem is created. If the transaction is structured as a sale of all a company’s stock or limited liability company interests, however, a business broker is acting as an unlicensed broker-dealer. Some business brokers may be operating under the belief that the sale of 100 percent of a business is exempt from the securities laws, but the United States Supreme Court rejected that notion in 1985. The issue of “finders” often arises when businesses go to raise money. To steal a line from Mark Twain, you can’t swing a dead cat in Utah without hitting someone who will offer to

by Kevin Timken

help you find investors for a fee. Often, these individuals will tell you that they’re within the rules because they’re only acting as finders, which is permitted by the Securities and Exchange Commission (SEC). Nearly all of these individuals are going well beyond the actions permitted by the SEC. The limits of what a finder can legitimately do are outlined in a 1991 SEC no-action letter directed to the singer/songwriter Paul Anka, who proposed to help a Canadian hockey team raise money in the U.S. for a commission. The SEC said that it would not take any action against Anka if he provided the team with the names and telephone numbers of people with whom he had a preexisting business or personal relationship and whom he believed might be interested in investing. The SEC relied on Anka’s assertions that he would not be making introductions, participating in negotiations, making any recommendations to the potential investors or playing any role in the offering of the securities. Most Utah finders propose to do much more, and the Securities Division has taken the position that any actions beyond those permitted in the Anka letter will move the person from being a finder to being an unlicensed broker-dealer — and subject to enforcement actions by the Utah Division of Securities. The bottom line is that the Securities Division believes that anyone receiving a fee for helping a small business with the sale of securities must be licensed as a broker-dealer. If businesses receive proposals or are considering entering into an agreement that might result in someone acting as an unlicensed brokerdealer, they should consult with a securities attorney before taking any actions that might end in an enforcement action by the Division of Securities or expose them to liability.

The Securities Division takes the position that any business broker offering services such as “investment banking,” “mergers and acquisitions” or “fund-raising” is engaging in activities that would be “difficult, if not impossible to conduct without being deemed a broker-dealer.”

UtahCEOmagazine.com

Kevin Timken is a partner at Kruse Landa Maycock & Ricks LLC. He specializes in corporate and securities law. To contact him, call 801-531-7090 or visit klmrlaw.com. july 2009

In today’s economy, it’s more important than ever for an employer to be able to rely on the loyalty of key employees and ensure the protection of the company’s confidential information and legitimate business interests. A non-compete agreement for key employees is one tool an employer can use to further this goal. But, it’s important that the agreement be used as a shield rather than a sword. While non-compete agreements are generally difficult to uphold, courts have upheld agreements that have been written narrowly enough to protect an employer’s legitimate business interests without unnecessarily restricting the employee’s ability to earn a living. Whether an agreement meets these criteria varies from case to case. The “one-size-fits-all”

The one-size-fits-all agreement doesn’t work, because each state has its own rules and laws governing what is acceptable. agreement doesn’t work, because each state has its own rules and laws governing what is acceptable. Below are some key points to consider for a non-compete to be effective in Utah:

June 9 - october 14

that are most vulnerable to the disclosure of information rather than other aspects of a non-compete may want to instead a non-disclosure agreement. Employers often use disclosure agreement with the focus on preventing disclo trade secrets and confidential information.

3. Limit to a reasonable geographic area. Courts disfavor agreements that require a person to in order to obtain other employment. The employer must thus show that there are very good reasons for preventin former employee from working in a certain geographic ar For this reason, the larger the territory an agreement see restrict, the harder it will be to demonstrate the restrictio legitimate. Agreements that have been upheld in Utah h June - october 16 the employer has been able to prove been8 those in which the employee’s services in the particular geographic area territory were unique, such that allowing the employee t for a competitor would harm the former employer’s legit business interests. An option some employers favor in th case of sales provisions is a non-solicitation agreement, w allows a former employee to continue to work in the geo area, but prevents the employee from contacting custom the employer for a limited period.

4. Limit to a reasonable period of time. Courts also dis agreements that involve lengthy time restrictions. Such restrictions have to be reasonable and appropriate to a gi employee. It is far more probable that a time restriction w upheld with respect to a key person in the business than an employee who is low level or performs general functio

1. Limit such agreements to key employees. Utah courts have upheld agreements where the employer has been able to demonstrate that the employee is a “key employee.” Such employees are an integral part of the A ﬁnal word: Act in good faith. In order to use non-comp business and allowing them to go to a competitor and begin agreements effectively, an employer must have genuinely work immediately would be unfair. Employees who fit this confidential information or legitimate business interests definition have included media personalities; persons whose protect. Wisely used, such agreements can be an importa identities are so associated with the employer that there is means of securing the future of your business. no longer a distinction between the person, the employer and the employee; and those who have access to confidential information and knowledge about the employer’s business. General agreements used for all employees are usually not enforceable. august 25 - october 17 2. Limit to trade secrets or information that is truly PRESENTED BY THE SUMMER THEATRE INSTITUTE conﬁ dential. dInner catered by pre-Show 7:30 PM - M, th, F, s / MAtINEEs, 3 PM - F, s Agreements that seek to limit the disclosure of information Golden corral that constitutes a trade secret or is truly confidential are often JUL 8, 2009 - AUG 1, $15.50 ChILDREN $12.50 Adult $12.50, Child to (12 & enforceability under) $9.50 upheld. Critical the of such an agreement is aT THE INdooR HAfEN THEATRE proof of confidentiality. Is the information the employer seeks to protect material to the company’s operation? Is access to the information protected lock and key or password? Companies

Ivins, Utah

(Just outside of St. George)

(866) 321-3440 seeitoutside.com

S t R at E g i E S & taC t iC S

WHAT THE STIMULUS MEANS FOR

COBRA Don’t let COBRA missteps bite your company. by Les Roka regulations for compliance. However, even despite the much shorter than normal time between the passage of the legislation in February and the actual implementation (the provisions took effect in April), some employers still may not be aware of the penalties they face for not implementing the COBRA subsidy guidelines as required. “I’m pretty conﬁdent that a lot of small or mediumsized employers didn’t issue any notices as required back in April,” says Petersen. Employers who fail to comply with the guidelines could face penalties of up to $110 for each day they are noncompliant, he says, adding that employers also could be liable for costs and attorney fees associated with any insurance claims that would have been sustained under the COBRA provisions.

While some employers see the COBRA subsidy provided for in the national economic recovery act as an administrative headache, the opportunities for temporarily reduced premiums are a “pretty good gig” for employees who are trying to make ends meet while they look for new jobs in the current recession. Individuals eligible for coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA) because of their own or a family member’s involuntary termination from employment could pay only 35 percent of the full premiums for up to nine months. In other words, the 65 percent reduction in COBRA premiums could mean a savings of between $2,300 and $5,800 over a nine-month period for the costs of family health coverage. Meanwhile, the employer is entitled to recover the remaining 65 percent of the premium by taking the subsidy amount as a credit on its quarterly payroll tax return. “It’s a straight paper transaction,” explains Scott Petersen, a Fabian & Clendenin attorney who specializes in employment law and life, health and disability insurance law, adding that businesses do not have to submit any additional information beyond the usual Internal Revenue Service’s Form 941 to get the credit. Unfortunately for employers, especially those with between 20 and 75 employees, getting up to speed on the temporary COBRA subsidy provisions could be confusing, especially if there isn’t a person dedicated speciﬁcally to administering the complex, and often burdensome, federal

COBRa is an employer’s law

“Many employers assume that their insurance carriers are taking care of the COBRA notiﬁcations and updates,” Petersen explains. “But, COBRA is generally an employer’s law. The employer is the one ultimately responsible to ensure that the company is abiding by the law. Not knowing where to turn is a major concern for the employer.” Petersen adds that some employers who attended a workshop in April to learn about the new COBRA premium subsidy discovered that they also had fallen out of compliance with existing COBRA guidelines. “This is especially true for those who self-administer their programs,” he says.

getting up to speed

COBRA is generally an employer’s law. The employer is the one ultimately responsible to ensure that the company is abiding by the law. ”

The COBRA premium subsidy is a good opportunity for employers to get up to speed on their compliance and notiﬁcation procedures, especially because timely, accurate communication is critical to keeping up with the complexity of the frequently changing regulations and precedentsetting court cases. Even if employers failed to meet the April 18 deadline of notifying their COBRA-eligible workers regarding their rights to the new subsidy, they should act quickly to shore

— Scott Petersen, attorney at Fabian & Clendenin UtahCEOmagazine.com

july 2009

Seeking Customer Relations Specialist

Seven Peaks Waterpark ts Custom CorporatBeetheEvheroen . Show appreciation. Boost morale.

We are ready to put together a custom summer party that will make you a hero!

If you are

“in it to win it” we would like to meet with you…

• Seeking energetic, ambitious, ethical, goal oriented customer relations specialist.

www.sevenpeaks.com 801.377.4FUN 1330 East 300 North Provo, Utah 84606

• Outstanding relationship and communication skills required to establish and cultivate relationships with key decision-makers throughout the state. • Seeking a master juggler, with a strong work ethic and ability to produce consistent, outstanding sales results in an extremely fast-paced, high-energy environment.

In the spring of 2010 Jana & Jim will be migrating to New Mexico. Carlene & Jimmy will continue on in Salt Lake City.

• Must be adept at taking direction and following established, proven internal processes. Flexibility and able to switch gears with a moment’s notice a must.

Send Resume to: adv590@applyutah.com Fax: 801.204.6731 Telephone Robin : 801.204.6728

Dancing Cranes Imports A migration/O.B.O. sale is now on for these unique one-of-a-kind artifacts:

Angel Face Bali Buddha • Swarovski Crystal Chandelier • Life of Buddha 8’x6’ Thanka 24” Smoky Quartz Crystal • Serpentine Laughing Hotai • Carved Ebony Rhino Tiger Granite 18” Spinning Ball Fountain • 1 ton Geode • Carved Ebony Family Tree Australian Opal Fountain • African Chief ’s Chair • Golden Triangle 3-Face Deity Kashmir paper Mache & Walnut Carved Screens • Large Natural Citrine Crystal in Matrix Life Size Carved Dolphin • Bronze Metal Dragons • 7’/8’ Giraﬀe pair Life Size Carved Thai Baby Elephant • Burmese Ox Cart African Copper Raised Relief Faces • Baga Tribe Fertility Mask • Kashmir Wool/Silk Carpet Azerbaijan Dragon Sumac Carpet • Sitting Metal Ganesh • Bronze Elephant Head Lg. Terra Cotta Buddha Heads • Burmese Alabaster Marble Buddhas 36”, 22” & 14” 70lb. Piece of the Campo del Cielo Meteorite

Dancing Cranes Imports Emporium of World Culture

UtahCEOmagazine.com

july 2009

673 East 2240 South

801•486•1129

S t R at E g i E S & taC t iC S

SUBSIDY AT A GLANCE What is the COBRA subsidy?

Who is ineligible?

An eligible individual is entitled to pay only 35

Employees not eligible for COBRA, let alone

percent of the otherwise applicable premium for periods of continuing coverage under group health

the premium reduction, are those involuntarily

plans (including health, dental and vision coverage,

terminated because of gross misconduct or if they

but excluding ﬂexible spending accounts) begin-

voluntarily left their job. Also ineligible for the reduced premium are

ning on or after February 17, 2009, and for up to

those employees whose COBRA eligibility is a

nine months.

result of reduced hours, divorce, disability or death.

The employer is required to pay the remaining 65 percent of the premium and then recover that

What is the employer’s notification responsibility?

amount by taking it as a credit on its quarterly employment tax return.

The notice provided to a COBRA-eligible individual upon the occurrence of a qualifying

Who is eligible? Workers who were involuntarily terminated from their employment between Sept. 1, 2008, and now. The eligibility period ends Dec. 31, 2009.

COBRA notice must be provided to all individuals

If employees were involuntarily terminated from the job between Sept. 1, 2008, and Feb. 17,

who experience COBRA qualifying events, not just those who are eligible for the subsidy. Model notices that comply can be found at

2009, and they were not currently enrolled

www.dol.gov/ebsa/COBRAmodelnotice.html.

under COBRA, then they would have a second chance to sign up for coverage.

Where can more information be obtained?

The employer had until April 18, 2009, to notify employees in writing of their second

Guidance and other information are available

chance at enrollment. The employee then

on the U.S. Department of Labor’s dedicated

had 60 days to elect COBRA coverage with

COBRA website at www.dol.gov/COBRA.

the premium reduction. However, the enrollment period is still open, so Petersen

For speciﬁc information about how

advises that employers send notices as soon

employers can claim credit for the 65 percent

as possible. •

the procedure for electing it, especially those Employers also should be aware that regular

following:

•

the availability of the premium subsidy and mentioned above as being eligible for the subsidy.

In particular, employers should take note of the •

event must be expanded to include notice of

of COBRA premiums and ﬁle the quarterly

Employees involuntarily terminated after April

federal tax return (Form 941), see

18, 2009, should receive notice of the premium subsidy option with their normal COBRA notice. Make sure enrollment packages have updated

irs.gov/newsroom/article/0,,id=204505,00.html. — LR

information regarding the premium reduction and how to elect it.

UtahCEOmagazine.com

july 2009

S t R at E g i E S & taC t iC S

They could be setting up a risky precedent and invite problems resulting in future lawsuits and abuses.” — Scott Petersen, attorney at Fabian & Clendenin

up their compliance on this point even though the subsidy option expires at the end of the year, Petersen advises. Otherwise, employers might risk litigation over a health claim that would have been found to be eligible for COBRA coverage. Many employers provide a COBRA notice to employees in a policy and procedures manual or a health plan summary description, or have them sign off at the time of enrollment. “The problem is that these notices may be sorely out of date,” Petersen says. “And there is a good chance that a spouse or dependents may never have seen any of these notices.” While one does not need to be a lawyer to ensure that the COBRA guidelines are being complied with and that accurate, updated notices are being sent as mandated, employers should make sure that a human resources manager or beneﬁts plan administrator is designated to carry out the COBRA expectations. Insurance companies occasionally have distanced themselves from employer COBRA responsibilities because of potential liabilities and may only provide assistance if contracted to do so. Petersen adds that some insurance carriers charge a supplemental fee for administering COBRA guidelines especially if the employer has a self-funded plan.

avoiding breakdowns in communication

Doing housekeeping work in the way COBRA guidelines are communicated to eligible participants will help ensure that employers avoid the penalties and litigation that almost always result from a breakdown of communication anywhere in the process of administering COBRA benefits. There are lots of areas for potential mistakes, Petersen notes. It is not uncommon to see errors and omissions in a company’s summary plan description, a document that is required by the Employee Retirement Income Security Act (ERISA). “An employer could be expected to live up to any information as presented, so it is always wise to tailor COBRA notices to the plans and participants specific to the employer,” he adds. Model templates for notices are freely available at the U.S. Department of Labor’s website. Petersen also has found many employers to be vulnerable to widespread misinterpretations of the Family Medical Leave Act and the connections to COBRA. While leaves of absence as mandated in the law do not qualify as COBRA events because the employee on leave cannot be dropped from group coverage, a COBRA notice is triggered if the employee does not return to work at the end of the leave. Mistakes in COBRA administration not only result in losses due to litigation, but also financial losses especially to employers who selfadminister COBRA. “While many employers are properly mindful of erring on the side of caution,” Petersen says, “they should be aware that if they make exceptions for one employee and not another, they could be setting up a risky precedent and invite problems resulting in future lawsuits and abuses.”

Everything

First Impressions are

How clean are your carpets? CALL FOR YOUR FREE CONSULTATION TODAY. • CARPETS • DRAPES • TILE & GROUT • UPHOLSTERY

1912

Since

The Wasatch Front’s most preferred carpet & drapery cleaning company. • Salt Lake City 595-0909 • Taylorsville 964-1500 • West Jordan 569-0333 • Sandy 942-2658 • Bountiful 292-4600

• Provo/Orem 224-1143 • Park City 649-1270 • Ogden 627-9620 • Tooele 882-6987

www.coitutah.com UtahCEOmagazine.com

july 2009

S t R at E g i E S & taC t iC S

CHIEF FINANCIAL OFFICER

FOR HIRE If you don’t need a fulltime CFO, hire a temp. by Steve Gooch would begin with being a member of the executive team, being a No. 2 to the CEO and operating and thinking and existing as one of the strategic thought leaders of the firm.” Hiring an independent CFO is a logical option for a smaller company unwilling or unable to take on the expense of another staffer — especially one garnering a six-figure salary. “In Utah, a full-time CFO of a company with revenues of $30 million or less will have a baseline salary of under $120,000 to $175,000,” says Kent Thomas, founder and managing member of CFO Solutions, a Sandy-based financial services outsourcer. He notes that the costs of using an independent CFO can be as low as 25-50 percent of the cost of hiring a full-timer. But, Kaufman says the costs could go even higher. When taking into account the associated costs of onboarding a new c-level employee — including bonuses, payroll, benefits and other compensatory agreements — the price of a full-time CFO could reach $200,000 a year. He says that because a CFO for hire is, by nature, often a part-time worker, the savings can be even greater. “It will range anywhere from a half-day a month of need all the way up to two to three days a week of need. It’s possible for some companies to have a CFO on staff for as little as $750 to $1,000 a month.” But aside from cost is another concern: Does your company even need a full-time CFO? Granted, every company needs a financial expert to work the books and keep the cash flowing, but is hiring a new executive necessary? Thomas notes that smaller companies often don’t have the workload required to keep a high-level worker busy. “If they hired a full-time CFO, he’d end up doing clerical work and things unrelated to his job and that are not a good use of his time or a good leverage of his or her expertise.” Kaufman agrees. “The philosophy that we work under is that every business needs a CFO, but with the concept of independent CFOs, they should all be able to afford one on an outsourced, use-exactly-what-you-need basis. Usually a company doesn’t need a CFO on a full-

Finances are the most important consideration when operating a business, especially in today’s economic climate. Cash and access to it can make or break a venture, so your company’s ability to handle it properly is crucial. Most midsize and larger companies employ a chief financial officer who is in charge of directing the company’s financial strategy and guiding the related segments of the company toward the appropriate goals. But though small companies often can’t afford or don’t need a full-time CFO, good fiscal policy is just as critical for them as it is for the big boys. “Businesses live or die depending on how they handle their cash,” says Jeremy Andrus, president of Utah-based audio equipment-maker Skullcandy. He says Skullcandy realized its need for financial direction early on, while the company only had four employees. But hiring a CFO to oversee a quartet was out of the question. So, Skullcandy decided to contract with a company that provides financial officers on demand. “We started using Kent Thomas and CFO Solutions probably in 2004. The reason we did it initially is the company didn’t have the scale where it made sense to have a full-time CFO.”

TOO SMALL TO SCALE

But what does a for-hire CFO do? “The easiest way to explain it is he does everything that you would expect a CFO to do in a large organization,” says Ken Kaufman, founder and CEO of Utah County-based CFOwise. “That

It’s not just experience, it’s successful experience — experience delivering results.” — Kent Thomas, founder and managing

member of CFO Solutions

UtahCEOmagazine.com

july 2009

S t R at E g i E Sassistants & t a C t i Con S April 21 each year. Utah CEO would like to recognize the best of the best . . . We recognize our

Utah CEO 2009

Professional Assistant Award The most successful CFOs are most CFO AT HOME

Sometimes you need help on the homefront, too. If your assistant is tops, tell us why.

successful when they switch industries, because they bring something that has be recognized as the of theerent best. (Be industry” sure to include an worked well inbest a diff anecdote to make your case). go to Utahceomagazine.com and

presented by

— Barbara Ray, founder of Vantage Point Advisors What makes a good executive or administrative assistant? click on “admin award” to submit your nomination by june 30, Outstanding organizational skills? judgment and ferocity as Though financial representation is 2009. Please include your telephone number for confirmation. a gatekeeper? a knack forfor anticipating and solving a requirement most companies, it’s problems? time basis until they hit a certain level of sales and complexity.” He CEO editor, and staff , will choose a winner who will Utah CEOgenerally wants to not recognize the best administrative assistant even considered for the notes thatOur theUtah threshold is different for every company; while some in the state. thencompanies be featured inneed ourtoAugust Utah CEO issue. The owners of those businesses. Barbara Ray, fast-growing might find a full-timer immediately,

founder of Vantage Point Advisors, thinks companies that show slow-and-steady revenuein growth could wait aads winner will also be featured promotional The rules: C-suite executives must do the nominating and it should be, especially when the business bit longerin before starting a search. The Salt Lake Tribune and Deseret News. can only nominate their own assistant. Write an e-mail no

owner is looking to divest him- or herself of the company. “My clients come to me TAKE HISTORY INTO ACCOUNT when they’re thinking about leaving their If your organization decides to use a CFO for hire, there are company, need an exit strategy and they a number of things to consider. First, research the company or The honoree will receive a professional portrait session, a one night stay at the Anniversary want to plan for it — or they’ve done it individual you are planning to contract with. “Check out background Inn, and a gift cate dinner forjust two at would the Metropolitan, a bouquet they certifi don’t know whatto to Massage do next,” she Envy,and references as you an employee,” advises Thomas. “It of says.flPart of that involves helping the nowshould be easier to check out an outsourced CFO, because he or she owers from Tri-fec-ta and a box of gourmet chocolate from V Chocolates. former CEO plan the company’s sale, gift should have a lot more clients and people to refer you to.” to employees or stock exchange, but also “You want to have somebody who has at least a decade of what happens afterward with the family really good senior executive-level experience,” says Kaufman. But, finances. he suggests that while executive experience is good, size is often more beneficial. “There’s a big difference between running a large She says that CEOs are often so corporation and running a small to medium-size business. So, if involved with company work that they you’re hiring an independent, it has to be someone who knows and forget to consider the personal side. So, understands the challenges, concerns and problems of business as the CEO’s personal CFO, Ray handles owners, entrepreneurs and founders of startup, emerging and the family’s finances, including wealth medium-size businesses.” Further, Thomas believes that even mere management. She says a major component experience isn’t enough: “It’s not just experience, it’s successful of her work involves getting wives up to experience — experience delivering results.” speed on how the company is really doing. “The husbands are intimately involved with ADD A DASH OF VARIETY how the company is faring, while the wives While a full-timer may know the ins-and-outs of your particular aren’t usually involved in those discussions, business, an outsider can often bring a fresh perspective to issues but they should be,” she says. Wives often that may crop up or can provide new efficiencies derived from assume that their husband’s company is other businesses or industries. Barbara Ray, founder of Vantage doing just fine because money is coming Point Advisors, a Salt Lake City firm that provides CFO expertise in, but they aren’t exposed to the realities to private individuals (see sidebar), says independent CFOs often and risks associated with business. The bring a variety of experience from many different past and current same is often true for a woman owned positions. Along with those experiences, they bring the knowledge venture of approaches that worked for those organizations as well as the chops to apply them. “The most successful CFOs are most successful If you consider hiring a personal CFO, when they switch industries, because they bring something that has what should you look for? Says Ray, “The worked well in a different industry,” she says. first thing is credentials and background, Kaufman believes similarly that CFOs with diverse backgrounds the second thing is personality — do you often have a more complex view of an individual business than do like them? — because you’ll be working single-company executives, especially with respect to problems or with them the rest of your life theoretically.” process improvements. “An effective CFO has both breadth and depth in terms of background and applicable skill sets. It’s very — SG common that my clients ask me, ‘How do other industries handle this problem?’”

longer than 150 words telling us why your assistant should

S t R at E g i E S & taC t iC S

CFO AT HOME Sometimes you need help on the homefront, too.

The most successful CFOs are most successful when they switch industries, because they bring something that has worked well in a different industry” — Barbara Ray, founder of Vantage Point Advisors

Though financial representation is a requirement for most companies, it’s generally not even considered for the owners of those businesses. Barbara Ray, founder of Vantage Point Advisors, thinks it should be, especially when the business owner is looking to divest him- or herself of the company. “My clients come to me when they’re thinking about leaving their company, need an exit strategy and they want to plan for it — or they’ve done it and they don’t know what to do next,” she says. Part of that involves helping the nowformer CEO plan the company’s sale, gift to employees or stock exchange, but also what happens afterward with the family finances. She says that CEOs are often so involved with company work that they forget to consider the personal side. So, as the CEO’s personal CFO, Ray handles the family’s finances, including wealth management. She says a major component of her work involves getting wives up to speed on how the company is really doing. “The husbands are intimately involved with how the company is faring, while the wives aren’t usually involved in those discussions, but they should be,” she says. Wives often assume that their husband’s company is doing just fine because money is coming in, but they aren’t exposed to the realities and risks associated with business. The same is often true for a woman owned venture If you consider hiring a personal CFO, what should you look for? Says Ray, “The first thing is credentials and background, the second thing is personality — do you like them? — because you’ll be working with them the rest of your life theoretically.” — SG

UtahCEOmagazine.com

time basis until they hit a certain level of sales and complexity.” He notes that the threshold is different for every company; while some fast-growing companies might need to ﬁnd a full-timer immediately, companies that show slow-and-steady revenue growth could wait a bit longer before starting a search.

TAKE HISTORY INTO ACCOUNT

If your organization decides to use a CFO for hire, there are a number of things to consider. First, research the company or individual you are planning to contract with. “Check out background and references just as you would an employee,” advises Thomas. “It should be easier to check out an outsourced CFO, because he or she should have a lot more clients and people to refer you to.” “You want to have somebody who has at least a decade of really good senior executive-level experience,” says Kaufman. But, he suggests that while executive experience is good, size is often more beneﬁcial. “There’s a big difference between running a large corporation and running a small to medium-size business. So, if you’re hiring an independent, it has to be someone who knows and understands the challenges, concerns and problems of business owners, entrepreneurs and founders of startup, emerging and medium-size businesses.” Further, Thomas believes that even mere experience isn’t enough: “It’s not just experience, it’s successful experience — experience delivering results.”

ADD A DASH OF VARIETY

While a full-timer may know the ins-and-outs of your particular business, an outsider can often bring a fresh perspective to issues that may crop up or can provide new efﬁciencies derived from other businesses or industries. Barbara Ray, founder of Vantage Point Advisors, a Salt Lake City ﬁrm that provides CFO expertise to private individuals (see sidebar), says independent CFOs often bring a variety of experience from many different past and current positions. Along with those experiences, they bring the knowledge of approaches that worked for those organizations as well as the chops to apply them. “The most successful CFOs are most successful when they switch industries, because they bring something that has worked well in a different industry,” she says. Kaufman believes similarly that CFOs with diverse backgrounds often have a more complex view of an individual business than do single-company executives, especially with respect to problems or process improvements. “An effective CFO has both breadth and depth in terms of background and applicable skill sets. It’s very common that my clients ask me, ‘How do other industries handle this problem?’”

july 2009

Results. One word says it all. Let Snapp Conner PR show you what a strategic public relations program could be doing for your business.

What is the COBRA subsidy? An eligible individual is entitled to pay only 35 percent of the otherwise applicable premium for periods of continuing coverage under group health plans (including health, dental and vision coverage, but excluding ﬂexible spending accounts) beginning on or after February 17, 2009, and for up to nine months. The employer is required to pay the remaining 65 percent of the premium and then recover the 65 percent by taking that amount as a credit on its quarterly employment tax return.

Who is eligible? Workers who were involuntarily terminated from their employment between Sept. 1, 2008, and now. The eligibility period ends Dec. 31, 2009. In particular, employers should take note of the following: •

If employees were involuntarily

terminated from the job between Sept. 1, 2008, and Feb. 17, 2009, and they were not

Come visit our expanded headquarters. Call 801.994.9625, or visit www.snappconner.com for more information. would have a second chance to sign up for currently enrolled under COBRA, then they coverage. •

The employer had until April 18, 2009, to

notify employees in writing of their second chance at enrollment. The employee then had 60 days to elect COBRA coverage

Contacts: with the premium reduction. However, the

Cheryl Snapp Conner Jeremy Kartchner enrollment period is still open, so Petersen Managing Partner Partner advises that employers send notices as soon cheryl@snappconner.com jeremy@snappconner.com as possible.

Mark Meservy :: m creative Creative Services mark@mcreative.biz :: 801.423.3443

1258 W. 104th S. :: Ste. 301 :: South Jordan, UT 84095 :: 801.944.9625

S t R at E g i E S & taC t iC S

OUTSIDE LOOKING IN

CHIEF FILL-IN OFFICER Keeping your finances in order when you’re between moneymen. “Many companies at this point in time have a lot of changes,” says Bob Bench, managing director of Tatum’s Salt Lake City branch. “The average stay for a CFO in Fortune 500 companies is 28 months.” The reason? As companies merge or are bought and sold, CFOs are often the first to find out. The other thing they know is that the incoming CEO of the newly formed company generally brings his or her own trusted financial advisor. So, the CFO decides to jump ship before being forced off the plank. In the meantime, the company is operating without a financial rudder. Tatum is one company that offers services to help companies in this position. “We’re able to step in as CFO and serve that company and we actually become their CFO and begin working within hours,” says Bench. The independent CFO then fills in while the company searches for a replacement, which generally takes 3-6 months but can stretch as long as a year. Often, the financial services provider takes part in the search as well. Jeremy Andrus, president of Skullcandy, used CFO Solutions in such a way: “We brought Kent [Thomas] into the interview process so we can get his input on not only prospective CFOs, but as someone who has hired CFOs.” While the situation isn’t ideal, having a part-time CFO fill in until you can find a full-timer is a great solution for keeping your finances in order.

— SG

UtahCEOmagazine.com

“I think it’s very positive to bring a different perspective into the company that is more focused on what is happening economically rather than emotionally to the business,” says Bob Bench, managing partner of the Salt Lake City branch of Tatum, a national provider of interim CFOs and controllers (see sidebar). “What we find is many times in a business, a CFO and CEO have developed a relationship over the years that doesn’t allow them to take into account what the real economies are of the business.” Sometimes a reality check is exactly what a company needs to succeed. When employees are invested in a particular company, they are sometimes unwilling to “upset the apple cart,” according to Kaufman. An outside observer can often see things that insiders are either accustomed to or that they just plain disregard. More importantly, outsiders are beholden only to financial accuracy, so internal company politics have little effect on their performance. “In a market like today’s, it’s a harder thing to stand up and do the right thing for the company and its shareholders,” says Thomas. “As CFO, your fiduciary responsibility is to the shareholders, not the management team. If we’re ever asked to do something unethical or that we have a difficult time supporting, we’re able to stand up a little bit more directly to that.”

YOUR NEW RIGHT HAND

One thing you may not have considered to this point is the probability that you will come to rely on your part-time CFO far more than you expected. “Do [you] want a partner?” asks Ray. “Because that’s what the person has to be. Not necessarily monetarily, but within the business. A side-by-side partner. They’ve got to be in your hip pocket or you’re going to be frustrated. You have to work well together.” Because of the trust necessary to keep the relationship on track, the CEO and CFO need to be as close as Butch and Sundance. “The CFO needs to be [the CEO’s] strategic partner when running the ﬁrm,” says Kaufman. “The CFO is somebody that the CEO needs to talk to before any business decision is made. Somebody the CEO respects, has a good working relationship with and that the CFO really truly understands their business.”

SO LONG AND THANKS FOR ALL THE FIXES

Ultimately, the goal of a for-hire CFO is to be ﬁred. No, not for ﬁduciary shenanigans or monetary misconduct, rather because if they’ve done their job right, your company will come out the other side of a relationship larger and better positioned for success. “You get to a certain size and you say, ‘Now it makes sense for me to hire a fulltime CFO,’” says Andrus. When your company grows large enough, a CFO will be absolutely necessary both because of the complexity of your company’s transactions and to put at ease the minds of your shareholders and federal overseers. Independent CFOs, while you have them, are valuable additions to your c-suite. “You treat them as your own and they become part of your organization, but you realize that as your business grows and scales, you’re going to bring those services in-house,” says Skullcandy’s Andrus, whose company still uses CFO Solutions periodically for specialized products. “Kent [Thomas] told me once that they consider themselves successful when they’ve worked themselves out of a job. It’s a mark of success.”

july 2009

and businesses and residents use it to see what’s new in the state. Your advertising message will penetrate a dynamic audience of long-time Utahns and new arrivals who will connect with your brand. Advertising in Life in Utah is an ideal way to increase your company’s top-of-mind awareness in the state.

Distribution Creating a

HEALTHIER WORKSITE Starts with Lifting

As many as 150,000 copies will be distributed, and because of high pass-along readership, Life in Utah will be read by as many as 600,000 people this year. The magazine is mailed out and made available at convenient locations across the state, providing maximum exposure for your message. Life in Utah’s distribution includes: - 25,000 copies sent using Utah CEO magazine’s mailing list - 8 to 10 thousand copies sent using the Salt Lake Chamber’s mailing list

In addition, Life in Utah will have a strong presence at:

- Hotels - Salt Lake International Airport - Real estate companies - Libraries - Resorts - Travel companies - Travel and visitor convention bureaus across the state - Chambers of commerce across the state

Your Fingers.

More than half of all company health care costs are employee Rates lifestyle related … which means most of those costs are preventable. Past

Past Non-

Non MemBut now there’s %an easy way to reduce your health costs and have more productive employees Ad Size of Page Member MembercareMember ber Advertisers Advertisers and download through worksite wellness. Simply go to: www.health.utah.gov/worksitewellness 2-Page Spread 200 a Healthy $6,715.00 $9,401.00A Guide $6,379.25 $8,930.95 our toolkit. “Building Worksite: to Lower Health Care Costs and More Productive Full Page You’ll100 $3,950.00 $3,555.00 $5,154.75 Employees.” find that with this$5,727.50 step-by-step guide, you can introduce a wellness program that will: Back Cover

100

$7,900.00

$11,060.00 $7,110.00 $9,954.00 • Reduce absenteeism $6,675.50 $4,621.50 $6,007.95 • Improve morale and enhance your company image Page 3 100 $5,135.00 $6,675.50 $4,621.50 $6,007.95 Inside Back 100 $4,937.50 $6,418.75 $4,443.75 $5,776.88 www.health.utah.gov/worksitewellness Visit1/2our download the toolkit Page website 0.5 and$2,370.00 $3,081.00 $2,133.00 today! $2,772.90 tel. 801-538-6141 1/4 Page 0.25 $1,777.50 $2,310.75 $1,599.75 $2,079.68 Sponsored by the Bureau of Health Promotion 1/8 Page 0.125 $987.50 $1,283.75 $888.75 $1,155.3

• Help control health care costs Inside Front 100 $5,135.00 • Increase productivity

Contact For more information and to reserve your ad space, contact Brian Allfrey at 801-237-2753 or ballfrey@mediaoneutah.com

Co-Presented By

UTAH HEALTH FORUM 20 09 Reforming Our Health System 8/1/07 lb

Save the Date! November 4, 2009

Salt Palace Convention Center

To Sponsor Call Marie Bowcut, Director of Events, at 801-204-6831 for details.

Join us for the first annual Utah Health Forum where we will set the stage for health system reform in Utah. Together with state legislators, business leaders, community advocates, and citizens we will discuss the issues impacting your business and employees. The Summit will provide a forum for voices to be heard and solutions to be set in motion. Be part of the solution! Participate in this vital issue to help your business prosper and grow through the health care crisis.

UtahCEOmagazine.com

july 2009

LifeStyle

by Allison Hansen

LOCAL ARTS AND CULTURE ORGANIZATIONS NEED CORPORATE ASSISTANCE TO SURVIVE, ESPECIALLY IN THIS ECONOMY.

special partnerships like challenge grant programs; they buy ads in the playbill; and they have donated furniture and silent auction items for in-kind giving. Even in the difficult financial landscape, Wells Fargo is upholding a consistent level of support. Stephanie Harpst, Wells Fargo Utah Community Relations, serves on the Ballet West board. “Wells Fargo is very interested in funding the arts,” she explains. While the company contributes substantially in the areas of basic human services, “we want to make sure we’re funding [the arts] at the same level as we could. We know it certainly enriches our lives here in Utah. This year it is important we use our resources so we don’t lose our valuable programs. Because we are such a large corporation, we want to be a good community partner and corporate citizen. We feel that if a company can give money, they should give money in these times.” On a personal level, Harpst says she has a “great affinity for the arts.” She and her husband have season tickets for several local programs and are “’small collectors” of artwork for their home. She also serves on the Zoo, Arts and Parks advisory board and the Grand Theater board. Harpst pleads: “Let’s not forget those great groups that add to the culture of the community. Let’s support our great cultural institutions even during this tough economic time. We need to be aware that they’re struggling, and do what we can to help.” While Wells Fargo of Utah has maintained their support, other donors just can’t keep up this year. In fact, Ballet West recently cut four positions and sliced salaries in order to

Behind the tights and tutus, lights and leotards, it takes a budget of $6 million to $7 million for Ballet West to produce a single season of award-winning productions. Executive Director Johann Jacobs explains the breakdown: Most of Ballet West’s funding comes from government and foundation contributions supplemented by individual donations and ticket sales. Still, a valuable 7 percent of the company’s funding is attributed to corporate contributions. Jacobs admits that it doesn’t sound like much, but “it makes an enormous difference to us,” he says. In the Ballet West playbill, corporate support listings range from $250 to over $400,000. Local and national companies can support the ballet by writing a check or hosting ticket programs for staff and clients. “An organization can start at any level, from an employee benefit night to sponsoring the Christmas Eve Nutcracker,” says Denise Begue, director of development for Ballet West. Much of their corporate funding goes to education and outreach in the community, Begue explains. For example, commercial support allowed the ballet to reach 115,000 students and teachers through school programs last year. “Company contributions demonstrate excellence in community support and corporate citizenry,” says Jacobs. An example of one of the companies Ballet West consistently relies on is Wells Fargo of Utah. “They’ve been a stalwart donor,” Jacobs says with gratitude. Wells Fargo is listed as a Platinum Donor, contributing between $25,000 and $49,999. Their support goes primarily to the community outreach programs. The company also offers UtahCEOmagazine.com

july 2009

liFEStylE

It exemplifies that people have a great demand and need to recharge their batteries, and this is an easy, wonderful way to do it.”

shave $1.2 million dollars from its operating budget. “Of course everyone is quite concerned in the community. It is tougher out there, tougher for everyone. The news isn’t always good,” Begue says. The development team is changing its focus, looking for smaller donations from smaller companies and guidance from board members. They also understand as they hear from well-meaning donors who can’t donate right now. “If a corporation has to lay off a large percentage of their staff, it is hard to expect them to contribute,” Jacobs says. “So we tell them, ‘Everyone is struggling. If you can’t give this year, consider giving next year.’” Arts programs across the state are re-evaluating their plans as business partners are forced to scale back. “There have been major cutbacks, which effects giving,” says Quinn Dietlein, associate vice president of development for Hale Center Theatre in West Valley City. “[Companies] obviously need to take care of their flock, to make sure people have jobs. It is totally understandable. There are companies that we have enjoyed accepting contributions from that have had to bow out. A lot have asked us to come back in the third and fourth quarter. You can’t blame these corporations for pulling back a little bit.” Still, he reports, the fear of recession is “loosening a bit.” Several of the nonprofit’s supporters have stuck it out, “because they see the benefit,” he says. Partly because of this continued support, Dietlein says they have not yet let go of their main players or imposed salary cuts, “thank goodness.” UtahCEOmagazine.com

— Quinn Dietlein, associate vice president of development

for Hale Center Theatre

Actually, in response to a surprising recent rise in ticket demand, Hale Center Theatre is adding more seats. “I think it exemplifies that people have a great demand and need to recharge their batteries, and this is an easy, wonderful way to do it,” Dietlein says. Dietlein says smart businesses realize the mutual benefits of donating to local arts programs. “When corporations contribute to Hale Center Theatre and to the arts, the people who come and continue to support the arts are likely to send their support and goodwill.” Begue agrees that donating to arts programs means more than just helping put on a show. “An investment in Ballet West is an investment in the Salt Lake community. We support the schools, we pay taxes, we shop at the grocery stores.” To individuals considering purchasing tickets and to businesses contemplating donations, Johann Jacobs advises: “Now is the time. As you evaluate your own values, it is important to consider the arts and the value of the arts.” 55

july 2009

ViEWPOint

RECESSIONARY MARKETING Adjust your swing before giving marketing the axe.

Market to the new mindset

marketing is usually one of the first casualties of a recession. an international association of Business Communicators survey found that recessions affect a whopping 59.2 percent of corporate communications (usually in the form of cutbacks). Fortunately, companies who adapt their marketing to economic trends — rather than cutting it out altogether — can position themselves for sustainable Jacque Riley profits and future growth. Thanks to Utah’s relatively low unemployment numbers, technological niche and strong entrepreneurial spirit, this state is positioned to emerge as an international business leader if it can creatively navigate the current downturn.

Economic downturns are a time to stress quality and value. For instance, a-1 Steak Sauce expanded product uses during previous recessions, advertising a-1’s ability to ﬂavor hamburgers with the phrase “a-1 Steak Sauce isn’t just for sirloin anymore.” Similarly, during the 2008 holiday season, the makers of ziploc freezer bags unfurled a “Save leftovers, Save money” campaign to reach thrifty consumers. The goal should be to stress the lasting worth of a product or service while avoiding direct price comparisons. if price is your only selling point, you may run the risk of being undersold or cheapening the long-term value of your brand.

Go for strategy over frills

Don’t stop marketing

in a recession, it may be tempting to redirect your marketing line item to help cover daily expenses. however, companies like Coca-Cola, gE and Disney are with us today because they continued marketing during shaky economic times. Firms that already value marketing, who have a forward-thinking corporate culture and enjoy a stockpile of readily available cash, can see significant returns from stepping up their marketing during a recession, according to Dr. gary lillen, who co-authored the 2005 Penn State study, Turning adversity into advantage: Does proactive marketing in a recession pay off ? “i think it could be argued that marketing during slower economic times is more critical than ever,” said Rob Brough, zions Bank’s executive vice president of marketing and communications. “however, an organization’s marketing needs to be much more targeted and strategic. The tendency for some is to spend less on marketing in challenging times. The answer, however … is found in spending smarter — refining your message, narrowing your audience, and differentiating yourself from your competition.”

Recessions are an excellent time to reassess your marketing mix. instead of spending big bucks on high-dollar television ads, it may be time to explore discount internet marketing. historically, public relations eﬀorts that focus on building relationships and developing personal connections oﬀer a high rate of return for your marketing dollar. Cromer’s P-nuts, an online popcorn and party supply store based in Columbia, S.C., is an excellent example of a company that thrived after implementing a smart, low-budget marketing strategy. annoyed with a competitor who claimed that Cromer’s had the worst peanuts on the market, the company founder scrawled a makeshift “Worst in town” sign. That 1937 incident connected with Depression-era customers who could use a laugh, and its enigmatic claim continues to generate consumer interest today.

Batten down the hatches

Recessions are rough by deﬁnition, so be prepared for some rocky marketing waters. Once you’ve settled on a strategy, make sure management is ready to ride out the storm. you might have some day-to-day setbacks, but a continuing commitment to sharing the corporate vision will provide customers with an ongoing sense of stability. tough economic times can bring out the best in people, and the same goes for marketing. By focusing on enduring values like hope, steadfastness and community giving, good marketing can inspire your company, clients and community.

Jacque Riley is CEO of Riley Communications, which specializes in public relations and strategic writing. Her firm helps business leaders develop adaptive overall marketing strategies with an eye toward targeted communication and return on investment.

The views expressed are those of the author and do not necessarily reflect the views of Utah CEO. UtahCEOmagazine.com

july 2009

Meet the future UTAH CEO SUPPORTS

Utah CEO hosted a two-day Bizworld Camp for Silver Hills Elementary School at the MediaOne offices on June 3 and 4. The camp was funded by a generous donation by the Daniels Fund.

Each student team sets financial goals, analyzes forecasts, creates a diversified portfolio, tracks its investments and allocates assets.

As a national nonprofit, the BizWorld Foundation develops curriculum that teaches elementary school children the basics of business, entrepreneurship and money management in a classroom setting.

“Utah’s CEOs value the importance of teaching financial education to young students at this critical point in our economic history,” says Catherine Hutton Markwell, CEO of The BizWorld Foundation. “This is directly in line with our mission.”

“At Utah CEO, we believe the most important financial tool to spur inclusive economic growth is not a product — it is knowledge. Our partnership with the BizWorld Foundation will help bring that tool to children,” says Mary Ann Di Lapi, product sales manager.

Utah CEO would like to extend a special thanks to our valued client, Bob Miller, owner of Lorraine Press, and Bonnie Koci, marketing director, for their support of the Utah CEO BizWorld Camp. We would also like to express our gratitude to Marie Bowcut, director of events and public relations at MediaOne, for helping make this day a cherished memory for our BizWorld kids.

During the BizWorld Camp, students work in teams to start and run their own companies in a simulated friendship bracelet industry. Taking on different leadership roles, students learn the basics of business and entrepreneurship as they apply for jobs and design, manufacture, market and sell their products in a classroom marketplace. In addition, students assume the roles of analysts, controllers and traders to learn the basics of saving and investing.

Bonnie Koci Marketing Director, Lorraine Press

Bob Miller Owner, Lorraine Press

For more information about The BizWorld Foundation please call 1-888-4BizKids or e-mail info@bizworld.org

ViEWPOint

QUALITY CARE

Key to healthcare reform is discussion about quality. it may seem obvious to say that providing quality medical care is at the heart of a quality health care system, but too often, the current system rewards something diﬀerent. it rewards those who perform the highest volume of complicated procedures or treatments, utilizing the most expensive equipment and the latest medications when other, equally eﬀective and less costly alternatives are available. Certainly, there are situations when expensive medical interventions are entirely appropriate and even necessary. and we should continue to push forward, seeking, developing and implementing better and more advanced treatments and techniques. however, overall cost comparisons continue to show that those states that spend the most on health care do so without measurably improving health outcomes. The same may be said of the U.S., which consistently ranks at the top of the cost rankings and toward the bottom among Western nations on some health measures. Providing quality care means consistently doing what works — what has been proven. it allows and compensates caregivers (and insurers) to build relationships with patients, rather than randomly addressing discrete symptoms or illnesses. it emphasizes and rewards patients who take appropriate preventive care measures (weight and disease management, smoking cessation) and weeds out those procedures and practices that don’t add value. Some leading national and world experts have pointed to Utah as a model to emulate. in part, we’ve been able to keep costs lower because we’re a younger and somewhat healthier population. But in great part, it is because of our focus on providing consistent, evidence-based care. in the New York Times, Sen. john Kerry and newt gingrich, former U.S. Speaker of the house, wrote that in Utah, “best practices are incorporated into the clinical process, resulting in far better quality care at a cost that is one-third less than the national average.” it will be interesting to see how the health care reform movement develops. Without a serious discussion about quality, however, one wonders whether it can develop at all.

President Barack Obama’s prioritization of health care reform has fueled an already-vigorous debate about what is the best approach to address that issue. it is possible that our nation will see the most significant restructuring of the health care system since the advent of medicare in 1965. in Utah, that journey has already begun. in march, legislation Charles Sorenson authored by house Speaker David Clark was signed into law. That legislation launched what is expected to be a multiyear health care reform process. Those first bills dealt primarily with insurance — including the market, products and administrative functions — and are a good first step. however, it remains true that lasting change addresses core issues; and quality is at the core of health care. Providing quality health care means that patients consistently receive evidence-based, medically appropriate care. it means that caregivers have the opportunity and incentive to provide that care, insurers have the incentive to promote and participate in it, and patients have the incentive to seek it. Unfortunately, in the current environment, that is easier said than done. The United States provides the best “rescue care” in the world. if you’re critically injured, suffer a heart attack or need treatment for advanced disease, you’re much more likely to survive if you receive care here than in other countries. We have the most advanced technology and the most experience in performing these intricate life-saving techniques. Where our country doesn’t do well is in the provision of best care for patients with chronic illness (like diabetes and asthma) and preventive care (including prenatal care). an increasing number of people lack health insurance (approaching 50 million) despite the growing proportion of the economy (17 percent) dedicated to health care.

Charles W. Sorenson, Jr., MD, is president and CEO of Intermountain Healthcare, a position he was appointed to in 2009. Dr. Sorenson is board-certified in urology and practices as a surgeon at the Intermountain Medical Center. He is a member and past president of the Utah Urologic Society. He belongs to the American Urologic Association, the American Medical Association and the Utah Medical Association, where he served on the board of trustees and as Speaker of the House of Delegates. He has served as vice chairman of the Department of Surgery at LDS Hospital, and as president of the hospital’s medical staff.

The views expressed are those of the author and do not necessarily reflect the views of Utah CEO. UtahCEOmagazine.com

july 2009

ViEWPOint

THE BENEFITS OF INEXPERIENCE Sometimes it’s what you don’t know that will help you. we removed job titles for several years to increase interaction and idea ﬂow. you may be surprised to ﬁnd that many of the most innovative ideas come from your least experienced employees. make sure you take every occasion to reward a new or disruptive idea.

Prominently displayed in our humble and cramped oﬃce space 10 years ago was a frame with the famous Pearl S. Buck quote: “The young do not know enough to be prudent, and therefore they attempt the impossible, and achieve it, generation after generation.” at the time, the quote served as a mantra to help buoy the conﬁdence of a group of 20-something friends trying to start a marketing business. Over the years, i’ve shifted the emphasis from “the young” to those that “do not know enough to be prudent,” as i’ve found it’s often inexperienced employees — those untainted by hierarchy, past failures and standard operating procedures — that have the most impact on a business, regardless of age.

Phil Hansen

how can your business harness the power of the inexperienced? Consider the following ideas:

1. Mix up the management

Don’t allow your executive team to be a homogenous group comprised only of people with the most tenure. try giving a young executive or an executive from another industry a place at the management table. you will be surprised at the energy and discussion generated from their non-traditional viewpoints.

2. Reward ideas and questions

attempt to remove any current fears that would prevent your executives and employees from questioning any and all aspects of your business. These fears usually revolve around hierarchy and job loss. in our business,

3. Assign expectations, not tasks

make sure you are VERy clear with your inexperienced executives about your expectations and how they will be measured. however, allow them the freedom to select the path and tasks that they believe will best help them achieve their goals. it has been my experience that this sense of freedom and ownership improves both the quality and speed of execution.

4. Executive cross-training

new or inexperienced executives often lack the institutional knowledge to place decisions within the proper context. to solve this problem, try placing your inexperienced executives within other departments for 60 to 90 days. We had our executive vice president of marketing help manage the call center for 60 days. She returned to her position with a new understanding of the connection between sales and marketing activities and a list of issues and solutions. although there are numerous benefits to be gained by the energy and fresh ideas of young or inexperienced executives, there are certainly liabilities as well. Be prepared to dedicate additional effort to the selection, management and communication of your new executives. Review their ideas, actions and results regularly. in the current economy, you can find an abundance of young, talented executives as well as experienced executives from other industries. timing has never been better to experiment with inexperience and “attempt the impossible.”

Phil Hansen is CEO of CLEARLINK, a performance-based marketing firm headquartered in Salt Lake City. The CLEARLINK brand portfolio includes: ADT Home Security, DISH Network, Qwest, HughesNet, AT&T and many more. In 2008, CLEARLINK was named the fourth-fastest growing company in Utah and was honored with a spot in the Inc. 500.

The views expressed are those of the author and do not necessarily reflect the views of Utah CEO. UtahCEOmagazine.com

july 2009

ViEWPOint

CONNECTING RURAL UTAH TO THE WORLD

The federal government is helping to bring broadband to the back roads. The impact of having adequate and affordable access to broadband in rural communities in Utah is enormous, increasing residents’ economic growth potential and giving them the opportunity to connect and compete in the global economy. Broadband not only improves the quality of rural healthcare, public safety and education, but it also attracts businesses to rural areas. Some Jerry Oldroyd studies have shown that rural communities have benefited from broadband by attracting large businesses and information technology-based businesses to their areas. The benefits of having broadband extend to small Web-based businesses, farmers, artists and local tourism authorities in rural areas. increased use of the internet promotes economic development in other areas as well, by increasing demand for broadbanddelivered and broadband-related products and services.

underserved areas; provide broadband education, training, equipment and support to schools, libraries, healthcare providers and support organizations; improve access to broadband service by public safety agencies; and stimulate the demand for broadband, economic growth and job creation. applicants for ntia grants will include indian tribes, nonproﬁt corporations, institutions, service providers, infrastructure providers, public-private partnerships, municipalities and states, including the state of Utah.

at the federal level, Congress has acknowledged the benefits that broadband provides and the necessity of ensuring that all americans have access to affordable broadband. There are numerous federal programs that offer funding for broadband access in rural areas. Congress recently passed legislation requiring the development of a rural broadband strategy, improvements in the collection of federal data on the deployment and adoption of broadband services, and the development of a national broadband plan.

The state of Utah, as part of its broadband policy, will also coordinate with local entities and service providers in its efforts to identify priorities and requirements for the deployment of broadband service to consumers and businesses in Utah. These issues are being addressed by the Utah governor’s Office of Economic Development. initially, the state will perform a needs assessment by obtaining comprehensive and accurate information on the availability of broadband service in rural areas of Utah, the extent to which consumers and businesses subscribe to broadband service, speeds, prices and the demand for broadband services. This information will be conveyed on a broadband map, which will be updated to track availability and infrastructure deployment of broadband service in rural Utah and assist with federal mapping efforts. The state of Utah will identify broadband priorities that are important throughout the state and will consult with ntia and RUS to help implement a comprehensive program that will begin to address the broadband and economic development priorities of rural Utah.

The Federal Communications Commission (FCC) recently released a report to Congress entitled, Bringing Broadband to Rural America: Report on a Rural Broadband Strategy. in the report, the FCC recommends that the various federal agencies administering broadband-related programs improve coordination of broadband policies and initiatives with other federal agencies, tribal, state, and local governments, and community organizations in rural areas. many of these organizations and entities have issues and knowledge unique to their areas and communities that would assist the federal agencies in administering programs.

in the recently passed economic stimulus package, the american Recovery and Reinvestment act of 2009, Congress appropriated $7.2 billion for grants and loans to expand broadband deployment programs to be administered by the USDa’s Rural Utilities Service (RUS) and the U.S. Department of Commerce’s national telecommunications and information administration (ntia). The RUS appropriations are to fund existing programs aimed at improving broadband access to rural communities. The ntia program is intended to provide new and improved broadband access to unserved and

Jerold G. Oldroyd is a partner at Ballard Spahr Andrews & Ingersoll LLP in the Business & Finance Department, and partner-in-charge of the Communications Group. He is a member of the Government Relations & Regulatory Affairs Group, and the Economic Stabilization and Recovery Initiative. He concentrates his practice in communications and government affairs, advising clients regarding the regulatory, legislative and municipal aspects of telecommunications law. Sharon M. Bertelsen is of counsel at Ballard Spahr and a member of the Business & Finance Department and Communications Group. She contributed to this article.

The views expressed are those of the author and do not necessarily reflect the views of Utah CEO. UtahCEOmagazine.com

july 2009

ViEWPOint

KEEP AT IT If at first you don’t succeed … fail, fail again until you do. in today’s business environment, success may seem very elusive to some CEOs. Businesses that have been around for years either have closed their doors or find those doors creaking shut. Bank empires have crumbled like an old cookie, and the well of money has all but dried up for some. John Pilmer

yet, amid failure we see new ideas and businesses emerging. So, what is failure? in a recent workshop led by garrett White exploring our “Soul Purpose,” i felt compelled to consider the role of success and failure in developing leaders. the faithful dictionary defines failure as “an act or instance of failing or proving unsuccessful; a lack of success.” But, is failure really all that bad? maybe we could ask a man who failed in business in 1831. he was defeated after running for state legislator in ’32. he tried another business in ’33. it failed. his fiancé died in ’35, and he had a nervous breakdown in ’36. in ’43 he ran for Congress and was defeated. he tried again in ’48 and was defeated once more. he tried running for the Senate in ’55 and he lost once again. the next year he ran for vice president and lost. in ’59 he ran for the Senate a second time and was defeated. then in 1860, the man who signed his name abraham lincoln was elected the 16th president of the United States. lucky for our nation that lincoln did not call it quits after numerous failures. how about another example? We could look at the man whose teachers said he was “too stupid to learn anything.” he was also fired from his first two jobs for being “non-productive.” then, as an inventor, he made 1,000

unsuccessful attempts at inventing the light bulb. When a reporter asked, “how did it feel to fail 1,000 times?” thomas Edison replied, “i didn’t fail 1,000 times. the light bulb was an invention with 1,000 steps.” the difference between history’s greatest accomplishments and its most staggering failures is often the will to persevere. there is no written law that says “when you fail you must quit.” Early in my career, the great sales trainer tom hopkins tutored me. more accurately, i should say my boss at the time, Richard Smith, the visionary CEO at Smith administrators, sent me for a day to sit at the feet of mr. hopkins. i subsequently pored over and digested his book, How to Master the Art of Selling. although i was the assistant to the CEO, not in direct sales, i tried to internalize lessons i have used in every job since then. i learned how to ask leading and open-ended questions, how to test close, the alternative close. What i learned has increased my success in everything from job interviews to closing new PR clients. Perhaps the greatest lesson hopkins imparted was his perspective on rejection and failure. he taught us to “never see failure as failure, but only as the game we must play to win — as an opportunity to practice our technique and improve our performance.” he taught that sales, and ultimately life, are largely numbers games. you have to go through some rejection and failure to get to the prize. Some of the greatest accomplishments in the world have come from those who have failed. Failure is not an end, but rather a chance to reevaluate and try again with even more knowledge, more experience and more zeal. although a business may close its doors or you may lose your job, it is not the end. Rather it could be the beginning of the next great world success.

John Pilmer, APR, is founder and president of PilmerPR. In its sixth year, the award-winning PilmerPR team provides enterprise-level public relations expertise at a small business price. The company is a 2008 recipient of the Provo/Orem Chamber of Commerce Arthur V. Watkins award for excellence. PilmerPR was recently recognized at the National Press Club in Washington, D.C., for its work in Corporate Social Responsibility (CSR).

The views expressed are those of the author and do not necessarily reflect the views of Utah CEO. UtahCEOmagazine.com

july 2009

S tat i S t iC S

UTAH’S ECONOMY

% % % -37.8 938.4 4.89

The average interest rate for a 15-year ﬁxed-rate mortgage as of June 18, 2009.

The average interest rate for a 30-year ﬁxed-rate mortgage as of June 18, 2009.

Source: Freddie Mac

5.38

million

Decrease in gasoline prices in the western United States from May 2008 to May 2009.

The total value of building permits in the Wasatch Front year-to-date June 23, 2009.

Source: Bureau of Labor Statistics

Source: Construction Monitor

Residential building permits March ’09 330 300 250 231 200 150 100 50

April ‘09

May ‘09

By the numbers

299 179

199 217 136

Salt Lake County Utah County

Utah

198 148

82 95 87

Davis County Washington County

Source: Construction Monitor

Commercial building permits March ’09 250 200 150 106 100 71 51 50

April ‘09

vs.

5.4% -3.3%

USA

9.4% -4.0%

Unemployment

Job Growth

May ‘09

as of May 2009. Source: Utah Department of Workforce Services

35 31 23

Salt Lake County Utah County

19 16 21

19 14 16

Davis County Washington County

Source: Construction Monitor

UtahCEOmagazine.com

july 2009

S tat i S t iC S

UTAH BANKRUPTCY Filings

810 59%

UTAH HOUSING

The number of Chapter 7 bankruptcies filed in May 2009.

From Q407 to Q408

Source: U. S. Bankruptcy Court, District of Utah

The increase in Chapter 7 bankruptcies comparing May 2008 to May 2009. Source: U. S. Bankruptcy Court, District of Utah

39,800

-6.4%

Drop in home price index (HPI) in Provo-Orem.

-4.8%

Drop in home price index (HPI) in Salt Lake City.

-2.3%

Drop in home price index (HPI) in Ogden-Clearﬁeld.

.9%

The number of nonagricultural jobs lost in Utah from April 2008 to April 2009.

-3.3%

Source: Department of Workforce Services

Source: Federal Housing Finance Agency

Increase in home price index (HPI) in Logan. Source: Federal Housing Finance Agency

Drop in home price index (HPI) in Utah. Source: Federal Housing Finance Agency

Utah Economic Indicators: 2007 – 2009 2% 4% 6% 8% 10% 12% 14% 16% Population

2007 2008 2009

3.2% 2.2% 1.7%

Nonagricultural Employment

Home sales by county

4.0% .3%

April 2009

-2.5% Unemployment Rate

2.7% 3.7%

Avg. price:

5.8% Average Pay

SALT LAKE

DAVIS

710

214

Single family sales:

$267,375 $232,912

Condo sales:

5.6%

Avg. price:

2.9% 1.9%

129

Avg. days on market:

340 $244,897 51 $151,957 84

Source: Salt Lake Board of Realtors,

9.7%

Wages & Salaries

$174,456 $147,601

UTAH

Utah County Association of Realtors

3.2% -.6% Retail Sales -1.1%

6.1%

-6.7% Exports

14.9% 37.9%

-8.5% Source: Council of Economic Advisors’ Revenue Assumptions Committee UtahCEOmagazine.com

july 2009

CEO Marketplace

UTAH NONPROFITS ASSOCIATION

If you are a fan of Unity then you are already a fan of Special Olympics. Donate, volunteer, coach or compete.

Utah National Guard Charitable Trust 12953 S. Minuteman Drive, Draper, Utah 84020

801-432-4544

UTAH NONPROFITS ASSOCIATION

WWW.SOUT.ORG CEO AD.indd 1

30 years and 75,000 phones installed

UTAH NONPROFITS ASSOCIATION

“STRENGTHENING ORGANIZATIONS THAT STRENGTHEN OUR COMMUNITY”

www.csi-networks.com IP Networks

Teleworkers

Voice over IP

Data Networks

Since

UNA REINFORCES THAT INVESTMENT!

1979

COMMUNICATIONS SPECIALISTS

801-617-2720 8283 South 4300 West

West Jordan

AdNumber: L17909/0000468052011 Operator: jl Call (801) 596-1800 Sales Rep: BBOURNE Purge Date: 07-06-09 AdType: creator6 Date: 06/28/09 For more information. Milestone: Released Station: www.utahnonprofi ts.org Size: L 2.00 5.00 Proof Addr: ATTN: ACCOUNTS PAYABLE SALT LAKE CITY UT Advertiser: COVERS UNLIMITED

$1,965 installed

$1,840

10’X16’ ft pergola installed with a lifetime warranty

Dec k

ed. at

t Service, Locally Owne s, Fas d oom Give Us A Call And Save $$$ & O r r n n pe SSuu r ss,,

Please make your donation to

been identified by our scientists than at any other cancer research institute.

Cancer Hospital ranked in the top 1% of hospitals in the nation for 3 Huntsman cancer care in 2007 by U.S. News and World Report.

E F R E AT E S IM T S E

CA TOD LL AY !

opportunities available, call 1-877-585-0303.

A reason to hope

V Pan Patio Covers

12 Months Same as Cash, O.A.C.

SALT LAKE OGDEN PROVO

huntsmancancerfoundation.org 1-877-585-0303

801.584.5800

To learn more contact Katie Porter at 801-236-2294 or Katie@cancer-wellness.org

12’X20’ ft patio cover with a lifetime warranty

Cancer Institute houses and manages the largest, most comprehensive 2 Huntsman genetics database in the world, and more inherited cancer susceptibility genes have

and the vital mission of providing social and emotional support to Utah men, women and children living with cancer and their families in a home-like setting.

SUMMER SPECIALS

HUNTSMAN CANCER FOUNDATION

CANCER WELLNESS HOUSE

THANK YOU FOR YOUR SUPPORT OF NONPROFITS IN UTAH.

CSI-NETWORKS, INC.

6/18/2009 9:41:31 AM

(801) 975-9545 (801) 394-0565 (801) 221-7660

ROOMS FOR ALL SEASONS AND ALL REASONS

UtahCEOmagazine.com

july 2009

We specialize in DIGITAL SOLUTIONS for Owners, Executives, Clients and Employees • DirecTV for Business • HD TV’s • Commercial Free Overhead Audio • On-Hold Music • Internet Service • Uniﬁed Communications Whether it’s for a single office, a waiting area or an entire building, we have a solution for your business. Contact Bryce Allfrey@ 801-978-0022 Bryce@skysat1.com

Help us plant a billion trees! Pre-order your free copy of The Print Responsibly Guide* and learn how you can cost-effectively print more eco-friendly.

For every Guide ordered, Lorraine Press will plant a tree with The Nature Conservancy’s Plant A Billion campaign. For more information and to pre-order your copy visit:

www.lorrainepress.com or call 801-972-5626 1952 West 1500 South • Salt Lake City, UT 84104 801/972/5626 • www.lorrainepress.com

*Expected release date: July 15, 2009. PDF version also available for download.

Print GREEN and SAVE green! - By Bonnie Koci

To be 100% “GREEN” can be expensive, but there are many things that you can do to print “green,” without spending a lot of green. Lorraine Press’ Print Responsibly Guide” explains that in order to print green, you have to look beyond the paper to every touch point, including the end-user. Quick tips from the guide include: You can still be “green” on a small budget! Make sure your printer is doing the following: • Uses a vegetable oil based ink, such a linseed, ﬂax oil, or soy. • Uses paper from conservsation minded paper mills. • Recycles printing plates, paper, cardboard, plastics, and lightbulbs. • Collects and recycles ink and solvent waste in a responsible mannor. • Prohibits the use of isopropyl alcohol, a dangerous chemical.

Below are a few other helpful suggestions: • Choose 1 of the 2 types of recycled paper. The least expensive is a combination of Post Consumer Waste & Recycled. • Use a full service printer who can limit the number of times the product is shipped by doing the finishing, mailing and fulfillment for you. • Ensure your proofing and press checks are done properly and accurately to avoid having to reprint. • Involve your sales rep early in the conceptual phase they can double check any design specs with other departments, such as finishing to make sure projects can be printed efficiently and produce the desired end product. • Support your local economy. Buying locally will not only reduce shipping costs but it sustains local jobs, and therefore stimulates the economy and lowers prices. • Research what it means to print “green.” The more you research, the better informed you’ll be to make the best decisions for you and your company. For more useful tips and information, order your free copy of the “Print Responsibly Guide” and plant a tree at www.Lorrainepress.com or call 801-972-5626.