Motivating your People in
Tough OFDA Dealer Strategies Conference Program
Times
Bill Kuhn: Leading in Times of Crisis
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‘The Tim es That Try Men' s Souls ’
What follows is a modified version of a column that ran in our sister office products publication, INDEPENDENT DEALER, some nine months ago. Sadly, it’s no less relevant today than it was back in November of last year.
When Thomas Paine wrote those words back in 1776, office furniture was the last thing on his mind. But for many of us in the industry today, Paine’s simple phrase provides an increasingly accurate description for our own times. And if most of the current industry forecasts hold up, it could well get worse before it gets better. But even with tough economic challenges, there are still plenty of opportunities out there for aggressive, well-run companies. Here are just some of the suggestions we’ve heard in recent weeks on ways to keep momentum going in the right direction, no matter how bumpy the road may get:
Make sure cash is king. One dealer we know is looking very seriously at selling the receivables from some of his larger customers who may generate big orders but who are typically slow payers. It may cost him a couple of points, but he says he’ll sleep a whole lot easier with the money under the mattress! Communicate, communicate, communicate. The rumor mill speeds up dramatically in uncertain times and if you keep your people in the dark, they’ll assume the worst. Keep close contact with key accounts, to let them know you’re still doing fine and to make sure they are, too. And also (see the next point), to probe for potential new sales opportunities. Maximize the value of each customer. There isn’t a dealer out there who couldn’t be selling more to their existing customers. And it’s not just about services like panel cleaning, asset management or rental programs. It’s also about selling artwork, coat racks or fireproof files. Talk long enough and often enough to your customers and you’ll be amazed at what you’ll learn about their needs. Make new business development a key strategic focus. No matter how bad it is out there, there are still companies that need to buy office furniture. Do you know where they are? Do you have a formal plan in place to take advantage of all the networking opportunities available in your market? Do your salespeople have new business development goals so that you can at least replace some of the business that’s been lost to factors totally beyond your control. Trim the fat. Go through every line item on your budget and eliminate anything that doesn’t add value or that isn’t totally
AUGUST 2009
mission-critical. You can’t afford to be spending money on anything for no reason than it’s something you’ve always done. Don’t allow tough times to shortchange your dealership. Staples CEO Ron Sargent made a great point in an interview last year with Office Products International magazine. He said, “It is very important to continue to invest in your business, in good times and bad times.” Maybe not as much as you’d like, but as Sargent suggests, this is still a good time to invest for the future. Don’t neglect your key strategic partners. Your manufacturers, dealer groups if you belong to one and technology providers all offer a wealth of resources you can leverage to continue to compete effectively. Make sure you’re making the most of all they offer. Stay positive. It may be a cliché but in many ways, your attitude really does determine your altitude. One of the strengths of any well-run small business is the ability to turn on a dime when changing market conditions demand it. You also have deep roots in the community and relationships strong enough to withstand the toughest downturns. And even the worst of times offer opportunities for good companies to gain market share and find ways to become stronger and more efficient. We have no idea how Tom Paine himself would respond to today’s testing times and quite frankly, we don’t really care. What’s more important is how you respond. You can watch TV, read the newspapers and become an expert on our current difficulties. Or you can make a conscious decision that enough is enough and that it’s time to go out and make something happen. It’s your call. What are you going to do about it?
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news Kayhan Hellriegel, Chicago Area Haworth Dealer, Receives Honorary Doctorate of Humane Letters Degree Honors are nothing new for Kayhan Hellriegel. As president of Haworth dealer, Kayhan International in Schaumburg, IL, she has amassed an impressive list of awards and special recognition, both within the industry and in her local community. Since founding her dealership in 1982, Hellriegel has been inducted into the Chicago Area Entrepreneurship Hall of Fame, earned recognition as a Women’s Business Enterprise Star by the Women’s Business Enterprise National Council and is the only dealer to win honors as a member of Haworth’s prestigious President’s Circle Award for 15 consecutive years. But even for Kayhan Hellriegel, Saturday, June 20 was special, as she strode proudly across the stage at East-West University’s 2009 Graduation Ceremony to receive an Honorary Doctorate of Humane Letters degree. The University, a private four-year college that primarily serves minority students in Chicago’s South Loop, provided an eloquent explanation for the honor: “When it comes to giving back to the community, few business leaders in the Chicago area can match Kayhan Hellriegel … For the past 12 years, she has been the honorary chair for the annual Chicago Commercial Real Estate Awards, with the proceeds donated to the Greater Chicago Food Depository. In each of the past two years, the event raised over $1 million, which provides more than four million meals each year for Chicago’s hungry.” In addition, the University cited her fundraising efforts on its behalf and her involvement in a special
business training and mentoring exchange program in cooperation with the U.S.-Afghan Women’s Council. Hellriegel came to the U.S. from Iran more than 40 years ago and her own success as an immigrant entrepreneur has left her with a deep sense of respect and obligation towards the American free enterprise system. “I really believe it’s important to give back to the community that has given all of us so much,” she says. That attitude, combined with an equally strong commitment to education inherited from her father, led to her involvement with East-West University and a fundraising effort that has generated several hundred thousand dollars in student scholarships in recent years. On behalf of OFDA, we’d like to add our own congratulations and appreciation for Kayhan Hellreigel and her willingness to provide an outstanding model of leadership and philanthropy that remains strong, even in these challenging times. continued on page 4
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Dealer News } continued from page 3 Corporate Environments, Atlanta-Based Knoll Dealer, Hosts Seminar Series on Environments Trends, New Technologies These days, it’s hard to find an office furniture dealer who doesn’t claim to be doing all it can to protect the environment and preserve precious natural resources. In Atlanta, Corporate Environments has taken its own commitment to sustainability to the next level, through a series of monthly meetings that positions the Knoll dealership as a valuable resource for anyone seeking to manage their workspace in a more environmentallyresponsible way. Spearheaded by A&D representative Laurel Hoover, the series’ scope extends far beyond the boundaries of office furniture. Recent topics include taking your building off the power grid, innovative indoor air purification methods and eco-friendly water treatment.
“Contract furniture is very similar in its orientation to the industries where I worked before,” McMennamy contends. “They all share a common focus on defining customer needs and meeting those needs in a way that exceeds expectations.” Despite current tough challenges, McMennamy points with confidence to a team of hard-working industry veterans on staff and to primary manufacturer Haworth as key resources for his new company and he says central Arkansas’ concentration of state and local government, healthcare and education clients provide a solid foundation for growth and make his market somewhat countercyclical compared to the rest of the industry.
Ohio Desk, Ohio Dealer, Earns Customer Service Award from Local Business Publication
“These sessions aren’t about selling product,” explains Hoover. “Instead, Corporate Environments is trying to provide a non-threatening, non-sales-oriented platform to educate the A&D community on new technologies and ways they can incorporate sustainable design into their own buildings.” So far, reports Hoover, the effort is generating an enthusiastic response, with attendance ranging from 40 to 150, depending on the topic and timing. And attendees not only come away with valuable insights on the latest in sustainability-oriented technology and design. They also leave with a far better appreciation of Corporate Environments and its ability to support their own efforts.
New Owners at Innerplan Office Interiors, Arkansas Haworth Dealership It’s been a busy couple of months to say the least for the folks at Innerplan Office Interiors in North Little Rock, Arkansas. In May, the preferred Haworth dealer celebrated its 30th anniversary and one month later, founder and chairman Jim Narup announced his retirement and the sale of the company to Roger McMennamy, a long-time Arkansas resident and business executive, who becomes Innerplan’s chairman, president and CEO. Also an investor in the company and joining the management team is McMennamy’s son Tim, who will serve as vice president and oversee the dealership’s financial, IT and HR functions. Before taking the reins at Innerplan, McMennamy held senior management positions in the oil and gas services industry, real estate and automobile dealerships, and that experience, he says, represents valuable preparation for running a contract furniture operation. AUGUST 2009
In Cleveland, Dave Humphrey and his team at Steelcase dealer Ohio Desk are still celebrating after earning honors as one of just 30 businesses in the Akron-Canton area to receive a 2009 World Class Customer Service Award recently from Smart Business magazine, a local business publication. And best of all, the award came after the dealership was nominated by the most important judge of all—their customers! Ohio Desk has been around for a while—the company bills itself as “Northeast Ohio's Premier Workspace Solution Provider Since 1908.” But, says Humphrey, it wouldn’t have lasted anywhere near that long without a fierce commitment to listening to its customers and responding to their key needs. The dealership has been surveying customers on a regular basis since 1987 and its Continuous Improvement Group, in place since 1988, provides a strong in-house change agent that keeps the company agile and responsive to changing market demands.
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Dealer News } continued from page 4 It’s a competency that has been particularly valuable in recent months, of course, as the Ohio market has followed the same downward trend as the industry overall. “After a very good 2008, we’ve had to make some adjustments like everyone else,” Humphrey reports, “but even though project sales aren’t where we’d like them, we’re seeing results from our services group—refurbishing, rental, storage, etc.—that are above expectations.” Humphrey also reports encouraging signs of life in the small business segment, as more and more executives laid off from larger corporations decide to strike out on their own and come looking for new but aggressively value-priced furniture. And when they come knocking on the door at Ohio Desk, they can be sure of a professional, service-oriented welcome, if the latest Smart Business Awards offer any indication!
New Owners at Steelcase Dealer Office Environments of Asheville, NC
The Moshers are taking over a business whose scope extends far beyond office furniture alone. In addition to its commercial sales, Office Environments also has a healthy residential operation that focuses on floor coverings for the home and, says Greg, expansion in that area is part of his and Erin’s future plans for the company. “Rob Pew and previous owners Chris and Nina Young did a terrific job of building the business and providing a great foundation for future growth,” he says, and he points with pride to deep roots in the local community and a 25-year history that includes recognition both as a Small Business Leader of the Year by the local Chamber of Commerce and as Outstanding Business in Philanthropy in the Asheville area. Even in the face of current tough business conditions, Greg’s optimism about the dealership and its prospects comes through loud and clear. “The local economy may be down right now,” he admits, “but Asheville is a terrific market and we still have an outstanding opportunity to grow what is already a strong business and take it to the next level.”
Environments at Work, Boston Haworth Dealer, Launches New Architectural Products Division Boston-based Haworth dealer Environments at Work recently announced the launch of a new division, Integrated Interiors at Work, to provide a single source for architectural interiors products, including moveable walls, raised flooring, and modular power; as well as design-build construction services for mission critical or data center environments.
Erin and Greg Mosher, left, have purchased Office Environments from Nina and Chris Young, right.
Office Environments in Asheville, NC, has new owners after the husband and wife team of Greg and Erin Mosher finalized an agreement August 1 to take over the company, a Steelcase dealership that was founded in 1984 by current Steelcase chairman Rob Pew. Erin, who will serve as president, is a native of Asheville who brings extensive office furniture experience to the company, after working with several different industry manufacturers and dealers on the sales and design side of the business. Vice president Greg, who has a diverse management background across multiple industries, will focus on HR, organizational development and operations at the dealership. AUGUST 2009
Industry veteran David Atwood, who has a long history of collaboration with Environments at Work and its clients, will lead the new division. “There is a significant and growing demand for the sustainable and adaptable benefits provided by moveable walls and raised flooring,” said Atwood. “As a division of Environments at Work, Integrated Interiors at Work will be able to provide customers with a tailored modular solution either as a stand-alone project or integrated with their furniture needs.” Integrated Interiors at Work will also provide full-service construction services for data center projects, the dealership said.
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BIFMA June Numbers: Orders Down 33%; Shipments Down 31% The Business and Institutional Furniture Manufacturers Association (BIFMA) released its market statistics for June earlier this month and both orders and shipments once again posted steep declines. June orders fell 33% compared to the same month last year, matching May’s 33% decline, while shipments were off 31%. Despite the declines, Raymond James’ analyst Budd Bugatch said he remains encouraged by early signs of stabilizing demand, though the near to medium-term revenue outlook remains guarded given the high level of economic uncertainty. While the industry’s relevant economic drivers — non-residential construction, business confidence, white collar employment, and office vacancy rates — remain negative, Bugatch said some indicators have begun to show signs of bottoming. Unfortunately, he added, given the late-cycle nature of office furniture demand, a recovery for the industry is likely to lag improvements in the broader economy by at least three to four quarters.
AIA Predicts ‘Deepest Decline in Over a Generation’ in Nonresidential Construction Activity As the overall economic downturn continues, nonresidential construction activity is shaping up to post the deepest decline in over a generation, according to Kermit Baker, chief economist at the American Institute of Architects (AIA). Baker made his forecast in connection with the release of AIA’s latest predictions from its semi-annual Consensus Construction Forecast, a survey of the nation’s leading construction forecasters. According to the AIA panel, overall nonresidential construction spending is expected to decrease by 16% in 2009 and drop by another almost 12% in 2010 in inflation-adjusted terms. Commercial projects will see the most significant decrease in activity, while institutional building categories are expected to see much more modest declines.
“While there are some indications that the overall economy is beginning to recover, nonresidential construction activity typically lags behind the rest of the economy,” Baker noted. “Commercial facilities such as hotels, retail establishments and offices will feel the decline most dramatically. The institutional market will fare much better as stimulus funding becomes available for education, healthcare and government facilities.” Specific market segment forecasts are as follows: Commercial / Industrial
2009
2010
Retail
-28.0%
-12.6%
Hotels
-25.8%
-16.8%
Office buildings
-21.5%
-17.3%
Industrial facilities
-0.8%
-28.4%
Education
-8.2%
-0.7%
Healthcare facilities
-1.5%
-0.8%
Institutional
Dunlap Office Furniture Index Shows Upward Trend Even as BIFMA and AIA continued to report gloomy industry statistics, slightly more positive news came from consultants Michael A. Dunlap & Associates. Dunlap’s quarterly industry index, which measures sentiment among a broad sampling of industry executives, showed that the industry’s deep downturn may perhaps be bottoming out. The index registered 48.30 for July, the best yet this year and up from April’s 41.45 and January’s 46.17. Encouragingly, more than 34% of survey respondents said they are optimistic about the future, up from just 25 % in April.
Green Building Certification Institute Launches Credentialing Maintenance Program The Green Building Certification Institute (GBCI), which earlier this year assumed responsibility for administering the LEED certification program, has launched a credentialing maintenance program (CMP) for LEED APs and Green Associates. continued on page 8
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Industry News } continued from page 7 With the launch of LEED v3 in April, GBCI put in place a number of changes to the LEED professional credentialing program, including the introduction of the LEED Green Associate and realigning the specialties within the LEED AP program to better reflect market practice areas. “More than 130,000 LEED APs obtained their credentials between 2001 and June 2009. CMP will ensure that those credential holders who tested under previous versions of LEED for New Construction, LEED for Commercial Interiors or LEED for Existing Buildings continue to demonstrate a level of knowledge that places them at the forefront of a constantly
evolving green building marketplace,” said Beth Holst, vice president of credentialing for GBCI. A number of activities qualify to earn LEED credential holders credit toward their credentialing maintenance. Those activities include continuing education as well as the practical application of LEED on projects and active participation in the green building community. A CMP Guide is available at www.gbci.org that outlines CMP-eligible activities and the requirements for maintaining both the LEED AP and LEED Green Associate credentials. continued on page 9
HON Reaches $1 Million Milestone in Support of the City of Hope, Earns LEED Silver Certification for Chicago Showroom The HON Company recently reached a significant milestone in its support of the City of Hope cancer research and treatment center when it passed the $1 million mark for funds raised through its annual City of Hope golf outing. HON was the first industry company to sponsor a golf outing for City of Hope and its eighth annual event was held June 23 in Muscatine, IA. “We were thrilled to reach the $1 million milestone in giving to City of Hope this year,” said Jerry Dittmer, HON’s president. “City of Hope is truly a remarkable organization, and HON and our members are dedicated to providing assistance whenever possible to such a worthwhile establishment.”
Separately, HON announced its Chicago showroom, located on the 11th floor of the Merchandise Mart, has received LEED Silver certification. At 9,760 square feet, the space was recently redesigned to be a flexible, sustainable pavilion that embraces the direction of HON's newest products and exhibits design features that indicate the performance desired in future work settings. HON partnered with SmithGroup, a leading architecture and engineering firm, on the redesign of the showroom. The space is designed to maximize exposure to daylight and views with an open pavilion of flexible zones. To complete the sustainable theme in the showroom, HON used numerous recycled materials throughout, including doors, glass, carpet and custom recycling bins.
Industry News } continued from page 8 Office Furniture USA adds five new dealer partners, six new showrooms Office Furniture USA said it continues to buck the current industry trend by expanding its base of dealer partners across the country. Since the beginning of summer, the organization said new dealer partners have been added in Boston, Memphis, San Diego, Columbus, OH and Wausau, WI. In addition, the company opened six new showrooms in Columbus, GA; Topeka, KS; Colorado Springs, CO; Irvine, CA; Findlay, OH, and Richmond, VA. “A showroom is a key factor in our business model,” OF USA president Dennis Arnold said. “It provides a way for potential clients to see products from the different manufacturers in our program. It’s also a physical touch-point for the sales rep, providing them with a differentiator in their selling process vs. other dealers in their area. That’s one reason our sales were up 18% for the second quarter; in fact, our June sales were up 58% compared to our low in February.”
LEED Certification for Kimball Showrooms Kimball Office announced two of its showrooms recently earned LEED certification from the U.S. Green Building Council. Kimball’s San Francisco received LEED-CI Gold certification, while its Atlanta showroom earned LEED-CI Silver certification.
New Owners for Jasper Library Furniture Jasper Library Furniture, a manufacturer of workstations, tables, shelving and seating to the library market, has been acquired by LIAT LLC, a management team partnership formed to purchase Jasper Group Brand from Jasper Group, an 80-year-old contract furniture manufacturer located in Jasper, IN. The new owners are Brian Lish, Fred Schutmaat and Jane Schutmaat, all formerly with Jasper Group. Brian Lish, president, will manage the daily operations of the company, as well as oversee the manufacturing facilities. Fred Schutmaat, executive vice president of sales, will be coordinating sales strategies and efforts, as well as LEED certification, FSC implementation and emerging technologies. Jane Schutmaat, executive vice president, will be managing projects and leading new product development.
The purchase includes full ownership of the brand, all product lines and two manufacturing facilities located in Troutman and Taylorsville, NC. Jasper Library Furniture currently has a total of 56 employees. The new corporate headquarters will be located at the production facility in Troutman, while the finishing lines and inventory will continue to be handled at the Taylorsville facility.
Allsteel Honored with 2009 Green Good Design Award
Allsteel Inc. has earned a 2009 Green GOOD DESIGN Award from The European Center for Architecture Art Design and Urban Studies and The Chicago Anthenaeum for its lean and ”green” manufacturing. The Award also recognized Allsteel’s use of its Rapid Continuous Improvement system to minimize waste and use of natural resources in its manufacturing processes. Among Allsteel’s “green” manufacturing accomplishments acknowledged by the Green GOOD DESIGN award are: L Implementing laser cutting of steel, decreasing waste by more than 1,000 tons annually and reducing CO2 emissions by more than 3,000 tons every year. Scrap steel pieces are recycled into new products, diverting nearly 6,000 tons of metal from landfills annually. L Recycling waste fabric into automotive liners, diverting about 300 tons of fabric from landfills and reducing CO2 emissions by more than 860 tons. L Changing the process for handling water during paint production, reducing water use by two million gallons a year. L Reusing materials to divert more than 30 tons of aluminum and more than 6,000 tons of wood from landfills annually. “We’re thrilled to be recognized as a sustainability leader by the international design community,” said Keri Luly, Allsteel’s manager of sustainability programs. “At Allsteel, we take great pride in not only producing quality workplace furnishings, but also continually improving our practices to better the environment.” continued on page 10
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Industry News } continued from page 9 Bretford Receives Greenguard Certification for Carts and Other Items Bretford Manufacturing said it has received Greenguard Indoor Air Quality Certification for 155 more of its carts, book trucks tables and accessories Bretford said these latest products include the first certified laptop cart and bring to 243 the total number of Bretford furniture models which can be specified to help commercial facilities achieve LEED points.
Gunlocke Offers ‘Green Calculator’ to Show How Its Products Can Contribute to LEED Projects Wood contract furniture manufacturer Gunlocke has introduced an online Green Calculator, located at www.gunlocke.com/greencalculator, to make it easier to include its sustainable product portfolio in projects to earn LEED credits. “Gunlocke’s commitment to the environment and role as a leading resource for sustainable products is evident in our new Green Calculator tool,” said Roy Green, Gunlocke director of stewardship and sustainability. “Because it takes into consideration all the factors associated with selecting sustainable materials for a project, we’re able to make specification simple and extremely efficient.”
HPFI Product to Be Featured in New Movie Coming soon to a screen near you is the Eve Collection of reception furnishings from HPFI (High Point Furniture Industries). Eve club chairs and sofa will be part of the set for The Experiment, a major motion picture featuring actors Adrien Brody, Forest Whitaker, Clifton Collins, Jr. and Cam Gigandet. The linear club chairs and sofa from the Eve Collection will be an integral part of the set during filming in Iowa. The movie is scheduled for release later this year.
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OFDA 2009 Conference Offers Exceptional Range of General Sessions and Breakouts Office furniture dealers of all types, installers, recyclers, manufacturers and industry service providers can expect this year’s OFDA Dealer Strategies Conference (Hyatt Lost Pines, Austin, TX – October 4-6) to once again ‘raise the bar’ in terms of industry education and networking. This year’s program includes a broad range of timely, practical management education sessions and numerous opportunities for effective professional networking. We also will be joined by the Office Furniture Recyclers (OFR) network, who will host an interactive session to highlight new opportunities in their segment of the industry and explore how they are responding to today’s economic challenges. By attending, you will expand your strategic vantage-point and gain fresh insights into how you can create new revenue streams, leverage outside resources and relationships for improved productivity, and hone your financial and other management skills to convert tough market conditions into a launching pad for the future success of your business.
huge value by interacting with dealers during social events and networking breaks and by participating in conference educational sessions alongside of their customers and/or suppliers.
Manufacturer Panel on the Future of Industry Distribution For example, top executives from four leading industry manufacturers have agreed to participate in one of our general session dialogs on the Future of Industry Distribution. Teknion president Maxine Mann, Knoll North America president Lynn Utter, AIS chief strategy officer Michael DuGally and Haworth VP of global sales Todd James will address such critical issues as:
aGiven recent economic and social trends, what will be the needs of the workplace of the future and how will this affect industry distribution?
aWhat workplace and other trends are leading office furniture manufacturers tracking most closely?
aDo you have a clear plan for navigating your business through aWhat changes could occur in the roles that dealers will play the toughest economic environment in decades?
aAre you and your team executing it fully and achieving the positive results you need to ensure survival of your business and a return to prosperity?
aAre you cutting the right expenses, managing your cash flow in the most effective manner, and making the ‘right’ strategic investments in your employees and business processes to support your immediate and longer-term plans?
aDo you wish you could move ahead more decisively to restore reasonable levels of profitability?
and how are the most successful and proactive dealers preparing for these changes?
aWhat new channels of distribution are emerging and how do they fit into the overall distribution structure for our industry? The OFDA fall conference is the single most important event for dealers and their key business partners to attend this year. It is always a challenge to step away from your business for even a few days, but when you face unprecedented challenges, as everyone in our industry does today, the justification for doing so is even stronger than in calmer times.
You’re not alone!
Online Registration and Early-Bird Fees Available
This year OFDA has structured its program to ensure the highest possible ‘take-away’ value for conference participants—no matter where you sit in our industry.
Registration for this premier event is easy. Just visit www.ofdanet.org/conference and follow the instructions there to view the full schedule of events and educational program, register for the conference online, make your hotel reservations at the conference hotel (Hyatt Regency Lost Pines) and learn about discount airfares and car rentals available.
Whether you are a small or larger dealer, an aligned or non-aligned dealer, or a large metro or smaller city dealer, you will find sessions that address topics of critical importance to your business. Manufacturers, installation and technology service providers— many small businesses like their dealer customers—also will find
You may also contact Chris Bates, OFDA president (cbates@ofdanet.org; Tel: 703/549-9040, x 100) or any member of the OFDA staff if you have questions or to request assistance. This is your industry event. Come be an integral part of it!
Navigating Business Through Unprecedented Economic Times
Invitation to
OFDA Industry Partners and Prospective Partners Dear Industry Colleague: There has never been a more critical time in our industry’s recent history for dealers and their essential industry partners - manufacturers, installers, technology and other service providers - to come together to discuss practical ways to ensure mutual business survival, while preserving the foundations for future growth.
Jack King
This year’s conference has been tailor-made to provide the ideal environment for serious business networking, collaborative learning, and a generation of fresh ideas and action plans to implement them. Like you, OFDA has taken a step back this year and re-evaluated every aspect of our annual conference strategy, format and agenda. We are taking the necessary steps to effectively engage association members and prospective members in an experience that will powerfully address your immediate and near-term business needs and reinforce your commitment to success.
Chris Bates
The result is an all-new approach toward bringing industry participants together in an informal, compact setting to acquire and refine critical business survival skills and create profitable new business opportunities. In short, this is a ‘must attend’ conference that will provide an exceptionally high ROI for your company. We invite you to become part of the single most important dealer-focused industry event of 2009 - one that will energize and further empower you and your team members who participate. We look forward to seeing you in Austin, TX on October 4-6 for a valuable, action-oriented program and business meetings. Sincerely,
Jack King 2009 OFDA Chairman
Chris Bates OFDA President
continued on page 14 AUGUST 2009
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About the
Office Furniture Dealers Alliance (OFDA) The Office Furniture Dealers Alliance (OFDA) is the industry association for office furniture dealers who are serious about improving the effectiveness and profitability of their businesses. Membership is comprised of these leading-edge dealerships and their key business partners - manufacturers, installers, and technology and other service providers. OFDAís annual Dealer Strategies Conference attracts principals and senior managers from these companies and the business meetings and display options outlined in this prospectus offer creative ways for companies like yours to engage and build or expand business relationships with them.
Why participate in
OFDA’s Dealer Strategies Conference & Business Meetings We chose our conference theme: Navigating Business Through Unprecedented Economic Times to accurately reflect the major challenges our industry now faces, but also the opportunities to overcome them with effective leadership, tighter strategic focus, consistent execution of core business processes and implementation of best practices in all aspects of financial management. To help OFDA members address these challenges head on, we have assembled a critical “survival toolkit” of interactive educational sessions. General and breakout sessions will offer fresh insights into winning leadership and management strategies and a variety of practical tools developed by business experts and industry peers that you can apply in your business for greater success. By attending you will: n Connect with hundreds of forward-thinking mid-market and contract office furniture dealers, recyclers, installers and industry manufacturing and service partners. n Identify and begin developing new business opportunities with current and prospective customers through OFDA’s flexible display and business meetings format in a compact, networking rich environment. n Discover how to implement strategies to expand revenues, proactively manage expenses, retain key employees and structure your business for survival and subsequent growth as the economy and our industry rebound. The Office Furniture Dealers Alliance (OFDA) is the industry association for office furniture dealers who are serious about improving the effectiveness and profitability of their businesses. Membership is comprised of these leading-edge dealerships and their key business partners - manufacturers, installers, and technology and other service providers. OFDA’s annual Dealer Strategies Conference attracts principals and senior managers from these companies and the business meetings and display options outlined in this prospectus offer creative ways for companies like yours to engage and build or expand business relationships with them. OFDA’s goal is to provide the most significant, valuable industry networking and educational event of 2009 aimed specifically at dealers and their key business partners. In short, THE event that is most worthy of your participation this year. OFDA has selected an exceptional facility (Hyatt Regency Lost Pines Resort) to host this year’s premier industry event. For those participants who wish to extend their stay, we are arranging a golf outing for Saturday afternoon, October 3, and the Lost Pines Resort & Spa offers a wide range of options and amenities.
Register at www.ofdanet.org/conference Today! continued on page 15 AUGUST 2009
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Conference Program Overview Keynote Presentation: “Challenging Times Never Last: Resilient Companies and People Do!”
Dr. Nate Booth
In today’s challenging market, closer industry collaboration and stronger business relationships among dealers, manufacturers and key business service providers are essential ingredients for survival and future success. This year’s opening keynote speaker, Dr. Nate Booth, will provide a clear roadmap that you can apply in your business to identify and make the essential changes, while holding fast to your company’s bedrock principles and values.
Mid-Day General Session: Sales Mistakes CEOs Make…And How to Avoid Them This presentation is specifically designed for CEOs and focuses on helping senior executives diagnose sales processrelated problems and more importantly, how to cure them. Gilbert Cargill explores the areas of marketing, selling, and customer retention. Each CEO will receive a Sales Effectiveness Planning Guide, a self analysis of 17 parameters that need to be addressed in order to maximize results. These include: compensation, sales management, forecast management, working with independent channels, recruiting, and managing marginal employees. Each OFDA conference participant will receive a complete collection of CEO sales tools, which Cargill has developed during his career. The sales "toolkit" that he delivers is frequently referred to as a "physician's desk-reference manual" for CEOs who want to sell more.
Opening General Session Panel Discussion: “Future of Distribution” Several of OFDA’s manufacturing members have generously agreed to share their perspectives during our conference on key trends, developments and initiatives shaping the future of the office interiors industry. Our high-level panel includes: n Maxine Mann, President, Teknion LLC n Lynn Utter, President, Knoll North America n Michael Dugally, Chief Strategy Officer, AIS Inc. n Todd James, Vice President, Global Sales, Haworth, Inc. In today’s uncertain times, it is critical to understand significant trends and market shifts occurring in our industry’s diverse marketplace. Our outstanding panel of manufacturing company leaders will offer practical insights based on their diverse experiences within and outside of our industry, as well as in North America and beyond. This year’s OFDA conference also will feature additional general session presentations and more than 20 breakout sessions, including panels made up of industry dealers, manufacturers and service professionals. Other workshops will be led by respected industry consultants and other experts, who will share best practices in the areas of general and financial management, particularly strategies that have proven successful in challenging economic environments. In addition, the program will include interactive presentations and discussion roundtables on such critical issues as cash flow management; leveraging new technologies for greater productivity and customer service; revenue forecasting in uncertain times; new business development in expanding government markets; developing, marketing and managing new services; and tools for profitable management of installation services and other areas of operations.”
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Conference Schedule & Educational Program – August 11, 2009 Update NOTE: The Office Furniture Recyclers (OFR) network and other industry groups are co-locating their functions with the OFDA annual conference, and participants in those meetings will arrive on Friday, October 2 or Saturday, October 3. OFDA members are also invited to arrive in time to participate in a joint OFR-OFDA golf outing on the morning of Sunday, October 4 or to simply enjoy the many other amenities that the Hyatt Lost Pines Resort & Spa and Austin offer. Special early-bird registration fees are in effect for all OFDA members, prospective members and members of the OFR, Facilities Service Network (FSN), Workplace Alliance (WPA) and Workplace Furnishings (WPF) groups who are attending those groups’ sessions just prior to the OFDA conference.
Sunday, October 4 Event Registration
10:00 A.M. – 5:30 P.M.
Ballroom and Meeting Room Display Setup
10:00 A.M. – 5:00 P.M.
Technology Neighborhood Setup
10:00 A.M. – 5:00 P.M.
Business Meeting Suite Check-in
3:00 P.M. – 6:00 P.M.
Association Partner Meetings (OFR, FSN, WPA Ops)
7:00 A.M. – 5:00 P.M.
OFDA Business Workshops (break at 4:15-4:30 p.m.)
3:00 P.M. – 5:30 P.M.
Advance Registration Requested: bzidek@ofdanet.org Allen Oppenheimer, President, A.M. Oppenheimer, Inc. Part 1: Business Valuation Process – A Step-by-Step Process Part 2: Business Exit Planning - It Starts Today! Trish Brock, President, Trish Brock & Associates Win More Business by Communicating Your Brand Effectively (Participants Encouraged to Bring Marketing Collateral and Best Practices to Share) New Member/First-Time Participants Welcome Session
5:30 P.M. – 6:15 P.M.
Hosts: Jack King, OFDA Chairman Chris Bates, OFDA President Opening Welcome Reception
6:30 P.M. – 8:00 P.M.
Hosts: OFDA Board of Governors Meet our Monday General Session Speakers: Nate Booth & Gil Cargill
Monday, October 5 Event Registration
6:30 A.M. – 6:00 P.M.
Opening Breakfast and OFDA Officers’ Welcome
7:15 A.M. – 8:15 A.M.
Keynote Presentation:
8:15 A.M. – 9:30 A.M.
Dr. Nate Booth, Author, Consultant and Executive Coach Challenging Times Never Last: Resilient Companies and People Do! Networking Break
9:30 A.M. – 10:00 A.M.
Pre-Arranged Business Suite Meetings
10:00 A.M. – 12:30 P.M.
Technology Neighborhood – Company Presentations
10:00 A.M. – 12:30 P.M.
20 20 Technologies (Steve Compton, Director, Commercial Sales)
10:00 A.M. – 11:15 A.M.
Additional presentation pending
11:30 A.M. – 12:30 P.M.
Morning Educational Breakout Sessions (11:15 A.M. Break)
10:00 A.M. – 12:30 P.M.
Strategic Management/ Sales and Marketing Leadership 10:00 A.M. – 11:15 A.M. – OFR Hosted Panel Discussion – Recycling Office Furniture: State of the Business Today and Growing Opportunities for Dealers 11:30 A.M. – 12:30 P.M. – “Different Economy, Different Sales Game, Different Sales Skills…What Are You Doing to Keep Your Sellers Fresh and Motivated?” (Debbie Junge, Junge & Associates) 11:30 A.M. – 12:30 P.M. – Building ‘Accountability’ into Your Company’s Culture (Jim Heilborn, Jim Heilborn Associates) continued on page 17 AUGUST 2009
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Conference Schedule & Educational Program – August 11, 2009 Update Financial Management/Survival and Profit Improvement Strategies 10:00 A.M. – 11:15 A.M. – Providing Solutions for Your Customers to Confront the Economic, Cash and Credit Crunch ( Dan Harkin and Janeen Waddell, Keystone Horizon Financial) Operations/Installation Best Practices 10:00 A.M. – 11:15 A.M. – Installation Economics for Survival and Profitability (Barry Coyle, SolomonCoyle) Technology Trends and Applications 11:30 A.M. – 12:30 P.M. – Social Media: the 21st Century Approach to Marketing Your Dealership (Kama Weinberger, IIDA, Q+E Design Source) Luncheon and General Session Presentation
12:30 – 2:00 P.M.
Gil Cargill, Cargill Consulting Group Roadmap to Accelerating Your Sales Results in Challenging Times Transition Break
2:00 – 2:15 P.M.
Pre-Arranged Business Suite Meetings
2:15 – 5:15 P.M.
Technology Neighborhood – Company Presentations
2:15 – 5:15 P.M.
2:15 P.M. – 3:30 P.M. - 20 20 Technologies (Steve Compton, Director, Commercial Sales) 4:00 P.M. – 5:15 P.M. – Presentation Pending Afternoon Educational Breakout Sessions (Break at 3:30 p.m.)
2:15 – 5:15 P.M.
Strategic Management/Sales and Marketing Leadership 2:15 P.M. – 3:30 P.M. – Growing Your Business Profitably ( Larry Dillon, CEO, Wendover Corporation) 2:15 P.M. – 3:30 P.M. – “Different Economy, Different Sales Game, Different Sales Skills…What Are You Doing to Keep Your Sellers Fresh and Motivated?” (Debbie Junge, Junge & Associates) 4:00 P.M. – 5:15 P.M. - Strategies for Successfully Marketing and Selling New Services (David Solomon, Barry Coyle, SolomonCoyle) Financial Management/Survival and Profit Improvement Strategies 2:15 P.M. – 3:30 P.M. – Roundtable Discussion: Forecasting Revenues and Cash Flow: Essential Survival and Management Tools (Jim Heilborn, Jim Heilborn Associates) 4:00 P.M. – 5:15 P.M. – Financing New Sales of Furniture through Capture of Remaining Value in Customers’ Existing Furniture (Larry Shapiro, Strategic Client Services, CORT) Technology Trends and Applications 2:15 P.M. – 3:30 P.M. – Leveraging Technology in Your Business for Greater Productivity (Panel Discussion; David Solomon, SolomonCoyle, Moderator) 4:00 P.M. – 5:15 P.M. – Social Media: the 21st Century Approach to Marketing Your Dealership (Kama Weinberger, IIDA, Q+E Design Source) Group Transportation to/from Downtown Austin Special Evening of Dinner & Music (Advance Sign-Ups Requested and Strongly Encouraged)
6:00 – 11:00 P.M.
Tuesday, October 6 Event Registration
7:00 A.M. – 12:00 P.M.
Opening Breakfast and General Session
7:15 A.M. – 9:15 A.M.
Future of Industry Distribution: Manufacturers’ Perspectives Lynn Utter, President, Knoll North America, Inc. Maxine Mann, President, Teknion LLC Michael DuGally, Chief Strategy Officer, AIS, Inc. Todd James, Vice President of Global Sales, Haworth, Inc. Moderator: Jack King, OFDA Chairman 9:15 A.M. – 9:45 A.M.
Networking Break Pre-Arranged Business Suite Meetings
9:45 A.M. – 12:00 P.M.
Technology Neighborhood Presentations
9:45 A.M. – 12:00 P.M.
9:45 A.M. – 10:45 A.M. – Understanding Wood Veneers - (Mike Clark, Eggers Industries) - .1 CEU AIA Credits 11:00 A.M. – 12:00 P.M. – Search Engine Optimization – Extending Your Visibility in Social Media Networks (Jit Gohil, Dijital Media) AUGUST 2009
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Conference Schedule & Educational Program – August 11, 2009 Update Morning Educational Breakout Sessions (Break at 10:45 a.m.)
9:45 A.M. – 12:00 P.M.
Strategic Management and Sales & Marketing Leadership 9:45 A.M. – 10:45 A.M. – Selling Value in Today’s Price Competitive Market (Panel Discussion, Greg Nemchick, President & CEO, Workplace Furnishings, Moderator) 11:00 A.M. – 12:00 P.M. – How to Structure and Manage Your Services Business for Greater Profitability (Barry Coyle, SolomonCoyle) Financial Management - Survival and Profit Improvement Strategies 9:45 A.M. – 10:45 A.M. – Maintaining Successful Banking & Lending Relationships in Tight Credit Markets (Moderator: Bill Coon, Office Furniture NOW!; Panelists: Kimberly Bronner, Vice President/Senior Business Relationship Manager, Wells Fargo Bank Austin; Patrick Johnson, Sr. Vice President, First State Bank Central Texas; Ed Lette, Vice President, Business Bank of Texas; Sam Thacker, Principal, Business Finance Solutions 11:00 A.M. – 12:00 P.M. – Repeated Session: Maintaining Successful Banking & Lending Relationships in Tight Credit Markets Operations/Sustainability Best Practices 9:45 A.M. – 10:45 A.M. – BIFMA’s New Sustainability Standard and Level™ Certification Process (Tom Reardon, Executive Director, BIFMA) 11:00 A.M. – 12:00 P.M. – Significance of BIFMA’s New Sustainability Standard for Your Business and Customers (Mindy Claridge, LEED AP, National Office Furniture - tentative) Vertical Market Opportunities 9:45 A.M. – 10:45 A.M. – Federal Government Procurement: Impact of the Economic Stimulus and Recovery Act on GSA’s Office Furniture Procurement (Mark Dunkum, General Services Administration, Director, Integrated Workplace Acquisition Center) Technology Trends and Applications 11:00 A.M. – 12:00 P.M.– Leveraging Technology in Your Business for Greater Productivity (panel discussion; David Solomon Moderator) 12:00 P.M. – 1:30 P.M.
Lunch with General Session Presentation Speaker Confirmation Pending Networking Break
1:30 P.M. – 2:00 P.M.
Pre-Arranged Business Suite Meetings
2:00 P.M. – 4:15 P.M.
Combined Local Dealership Tours (Advance Registration)
1:30 P.M. – 4:30 P.M.
2:00 P.M. – 2:45 P.M. – Office Furniture NOW! (Host: Bill Coon, Principal) 3:15 P.M. – 4:00 P.M. – Facilities Management Group (Host: Robert Keeton, Principal) Afternoon Educational Breakout Sessions (Break at 3:00 P.M.)
2:00 P.M. – 4:15 P.M.
Strategic Management and Sales Leadership 2:00 P.M. – 3:00 P.M. – Win More Business by Communicating Your Brand Effectively (Presentation: Trish Brock, Trish Brock & Associates) 3:15 P.M. – 4:15 P.M. – Finding Top Quality Talent in Today’s Market – Beyond Survival (Jeff Brown, President, Comprehensive Search) Financial Survival Strategies 2:00 P.M. – 3:00 P.M. – Furniture Leasing: A Powerful Tool in Cash-Short Times (Dan Harkin, Janeen Waddell, Horizon Keystone Financial) Technology Trends and Applications 3:15 P.M. – 4:15 P.M. – Social Media: the 21st Century Approach to Marketing Your Dealership (Kama Weinberger, IIDA, Q+E Design Source) Networking Break
3:00 P.M. – 3:15 P.M.
Closing General Session:
4:30 P.M. – 5:45 P.M.
Department of Defense Business: Expanding Opportunities and New Roles for Prime Contractors and Subcontractors Carol Elder, US Army Corps of Engineers John Wuichet, US Army Installation Management Command Moderator: Dave Branch, President, Facilities Connection 5:30 P.M. – 7:00 P.M.
Closing Reception Conference Concludes
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Motivating your People in
Tough Times As the economic downturn continues, office furniture dealers look to inspire their employees. By Scott Cullen
When the going gets tough…well, you know what happens next. In an industry that’s been rocked by the economic downturn, even the toughest in the furniture industry are finding that all the clichés in the world don’t do much to bring in business or ease frustration when most clients aren’t buying. Indeed, motivating employees, particularly sales reps, just got a whole lot tougher and even with the promise of economic stimulus dollars, times are still tougher than tough. What some in the office furniture industry are finding is that the old ways of doing business and motivating employees aren’t cutting it right now. Instead, new and improved, and drastic measures are necessary. “Business as usual isn’t business as usual anymore,” laments Kathy Pear, founder of Citron WorkSpaces in Denver, CO. With business anything but usual, Pear decided that a different approach was necessary to bring in business, and by extension, motivate her employees.
roach until they started to see the increase on their commissions. Fortunately, money talks and Citron’s employees aren’t walking, not that they’d have any place to go.
“We’re in survival mode and what we’re doing is selling more used furniture and furniture that we can get closeout deals on,” explains Pear. “We’re doing anything we can do and not worrying about the volume.” It took Pear a while to settle on this strategy, implementing it in May after five disappointing months. The strategy seems to be working and Citron is coming off a strong June and July. More importantly, employees are feeling better about the company’s direction even if they weren’t initially enamored with the new approach. As bidding has become overly competitive, something had to be done. “People are giving stuff away just to keep their doors open,” says Pear. “We’re doing fewer bids and letting everybody else fight over the scraps.” At first employees questioned the logic behind this app-
Turns out that selling more used furniture while doing less volume is working for Citron. It’s one antidote to an economic downturn, especially since big volume projects eat up resources. “We’ve lowered our expectations and aren’t beating ourselves up as much and just trying to do the best we can in a bad situation,” says Pear. “I wish I had done this in January.” Pear has been through lots of small downturns in the past but says she’s never seen anything like this before.
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Cover } continued from page 19 It hasn’t helped either that her major manufacturer began tightening credit limits when things really got bad.
opportunities. Beyond that we talk about what everybody is doing to be successful.”
“They were insisting on 100 percent payment up front,” she says. “So what do you think we did, we stopped ordering from them,” she sighs.
If all that sounds like Bowman preaching the basics of blocking and tackling, that’s exactly what’s going on—mainly because Bowman believes that some reps had drifted away from those basics when business was good.
Business at Florida Business Interiors (FBI) is down 20-25 percent this year. It’s a downward spiral that began in 2007 and has continued with big deals becoming fewer and fewer in 2008, and every one of those hotly contested by a number of competitors. Of late, FBI has experienced a good month followed by a down month. Despite the roller coaster ride, FBI president Denny Bowman is hopeful the company can continue an upward momentum and stay ready to respond to meet any pent up demand for office furniture that does emerge. Meanwhile, Bowman is implementing a three-pronged approach to motivate sales people to seek out new business and lay the foundation for future opportunities. Bowman’s three-pronged approach begins with weekly meetings with sales staff. When business started slowing down a couple of years ago Bowman hired a new business development person—the second prong in FBI’s three-pronged approach. The final prong was hiring a PR firm to assist with business development by getting the firm’s name out in the community and hopefully at the top of many buyers’ minds for upcoming furniture projects. Meetings with sales personnel have been particularly helpful. “Every week we talk about what architects they’re visiting, who they’re taking to lunch, which interior designers or commercial brokers they’re meeting with,” explains Bowman. “We discuss their opportunities and how we as a group can help them go after each and every opportunity and strategize on those
Sales reps are now encouraged to take clients, commercial brokers and contacts within architectural and interior design firms to lunch at least once a month or simply meet with them. “We’ve asked them to dig out their old databases and encouraged everyone to touch base with all their existing and old clients to see if there’s anything going on,” says Bowman. “It’s the people who go out and touch clients, take them to lunch, talk about their needs and show how they can help solve problems when there are no projects or orders, that will be remembered when things start getting better and orders start flowing again.”
Bowman’s reps are finding that this strategy makes sense and that old clients are coming back while new clients are appreciative that they continue to drop in even when there are no orders right now. “I told them it would take six to nine months, but they are starting to see the fruits of doing this and monitoring this and it’s my hope that this will become a habit again like it was before times were so strong in ’05 and ’06,” says Bowman. Goodman’s Interior Structures in Phoenix has been through good times and the bad. The one thing Goodman’s doesn’t do in bad times is panic.
The company is monitoring this activity every single week, holding everybody accountable. It’s starting to pay off, even though Bowman encountered some resistance from sales reps who found this approach a bit over the top in a Big Brother-like way. “We hire very entrepreneurial salespeople and they are very good at what they do and can mostly do it on their own,” notes Bowman. “That works wonderfully when things are decent, but when things get tough you forget some of those basic prospecting skills that you need to survive. We are making sure they relearn them, reuse them and establish new habits. These are things they know how to do, but we’re just reawakening those skills.”
Instead it keeps the lines of communication open with its employees while focusing on strategic planning and long-term business goals. “A big focus for us is to refresh and reengage our strategic planning process to make sure that everything is well aligned,” says Brian Turner, human resources director at Goodman’s. “It also gives our team something to focus on beyond the day to day.” continued on page 21
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Cover } continued from page 20 When the going gets tough it’s easy for negativity to set in and the dealership looks to offset that by looking at the big picture as opposed to just selling and installing furniture. “We stress what we do as an organization and what makes us feel good at the end of the day when we go home beyond just locking another business dollar in,” explains Turner. Employees are encouraged to focus on things that contribute to the growth of the organization as well as volunteer and charitable projects that impact the community. “That way, when folks talk about Goodman’s, employees are proud to say, ‘I work there,’” he adds. Beyond strategic planning and reexamining business goals, Goodman’s works hard to keep the lines of communication open throughout the organization. “We’ve really tried to increase the amount of communication with our employees,” says Turner who points out that in a lot of companies, communication is one of the first things to break down when times turn tough. Those communication initiatives encompass staff meetings and an internal newsletter that is light and fun and helps employees better know their co-workers. This also helps build stronger internal relationships. Management training is an area where many organizations cut back on in tough times, but not at Goodman’s. “We have a lot of solid individual contributors who get promoted through the ranks based on their expertise, but if we don’t take the time to develop and inspire our folks at the next level and in a management or leadership role, we’re not helping them,” says Turner. In addition to management training, Goodman’s also has a wellness program in place and kept it going, even as other organizations were trimming back during these tough times. “That’s been a big thing to help with folks, particularly with stress management and taking care of themselves because there’s always going to be another day to make another dollar,” says Turner. “And if we’re not taking care of ourselves during that process, not only are we a drain on our family, but on our friends and co-workers. We found that’s helped create a bond between our employees.” How does Goodman’s gauge its success in communicating with, motivating, and growing their employees? Turner reports that the company participates annually in a Best Places to Work contest.
track how we progress year over year and identify areas where we can improve.” No doubt being employed by a company that’s considered one of the best places to work in Arizona makes for a motivated staff. Convenience Office Supply in Austin, Texas, launched its furniture business in 2004 and even though they’ve seen their commercial business sink like a stone of late, their federal government business seems to be doing well and keeping the furniture business afloat. President Karen Bogart concedes that she hasn’t had to do anything special to motivate her furniture reps, mostly because they’re flying high after landing a couple of large accounts. “They’re looking at government clients a whole lot more—federal, state, county and school districts--so they’re really going out there and finding the business now,” says Bogart. For Convenience’s furniture reps, a little bit of success is all the motivation they need. That said, Bogart admits that her younger reps in their thirties are a little freaked out about what’s happening right now. “We keep telling them it’s cyclical and it’s going to come back,” she says. No matter how creative some dealers are in trying to motivate their employees, sometimes Bogart’s approach is all one can do to motivate employees when times are tough.
Scott Cullen has been writing about the office products, office furniture, and office equipment industries since 1986. He has been working as an independent writer and editor since 1997, and is currently editorial director and managing editor of OfficeSolutions and OfficeDealer magazines as well as publisher and editorial director of the new ezine, Imaging Solutions Reseller. Scott is also a frequent contributor to ENX magazine, Repro Report magazine, and Mercer Business magazine, and has written for various office equipment manufacturers and market research organizations, focusing primarily on product and dealer issues.
“We aren’t only competing with ourselves but on the best practices side in a number of industries,” he says. We can AUGUST 2009
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Motivating Employees Something to Consider By Jim Heilborn
Jim Heilborn is a business consultant and speaker specializing in the office furniture/products industry, working with dealers, manufacturers, and service providers. For more information please visit his website, www.jheilbornassociates.com. He can be reached directly at 916.434.8711 or jim@jheilbornassociates.com.
In the previous article, Motivating Your People in Tough Times, Scott Cullen discussed how dealers are boosting morale, providing sales alternatives or setting realistic forecasts as three ways companies can motivate their employees during difficult times. Motivating employees can be challenging even in the best economic times, especially considering that what works for one employee may not work for another. Zig Ziglar was one of my late father-in-law's favorite motivational speakers. After a speech one day, the famous motivational speaker was approached by someone in the audience who said: "Zig, it was a great speech, but...motivation doesn't last." Zig said, "Bathing doesn't either. That's why I recommend it daily!" Zig loves quotes and believes that the right quote can provide "a-ha" moments and can help to reinforce a positive attitude. Below are some additional ideas that you can use to help heighten employee confidence and give your company a business boost:
Rewards and recognition. While money is important, studies have shown that employees ranked recognition above monetary rewards. Every employee is critical to the success of a company, so make sure you have a program in place that recognizes the efforts of ALL employees and NOT just the sales staff.
tion and a purpose every day. There is great strength in feeling that you are all involved in the same mission. Reaching a goal together and then celebrating the attainment together is a great way to unite people and lift their spirits. continued on page 23
The four P’s. Praise in Public, Punish in Private. People love to be recognized in front of their peers and that can have a great carry-over effect. But nothing de-motivates and embarrasses others faster than seeing a fellow employee “dressed down” in front of everyone else. Besides being a real distraction, it can be a productivity killer as well. Provide leadership. Everyone is looking for direction and a feeling that someone is in charge and knows how to take the company where it needs to go. Sharing information with the staff helps to keep them involved and gives them a better understanding of the company’s direction. Information and knowledge are as important as rewards when motivating the staff. Dangling a carrot in front of a horse will possibly get it to move forward, but the driver still needs to know which direction it wants it to go and needs to steer it in that direction. Goals and objectives. Setting goals and objectives will give employees a sense of direcAUGUST 2009
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Heilborn } continued from page 22 Set expectations. Setting expectations gives employees a benchmark by which to measure their performance. It is a way employees can measure themselves and help instill a sense of accomplishment even without the benefit of a more formal program. It is much easier to get motivated to do something when you know what is expected. Orientation. Too many companies have not invested the time to create one of the most important motivational tools for new employees…a proper orientation program. Poor orientation is often the root cause of new employee turnover and management is usually at fault. They are so focused on getting the new employee working that they spend little or no time getting them acclimated to their new environment, fellow workers, procedures, or even the job expectations. No wonder they fail. Training. Like orientation, ongoing training is too often an afterthought…and too many times the casualty of a down economy. But it is usually a mistake to cut it off entirely. The right training can get people reinvigorated and energized, even in the face of adversity. Training often teaches people new skills or alternate approaches that help them to overcome the obstacles that stand in the way of their reaching their goals. Help your people to succeed. While salespeople are hired specifically to create and develop their own business, a great deal of loyalty can be engendered by providing them with some leads… especially in these tough times. Leads are not a right, but a privilege…so they should be earned by meeting some criteria. Receiving good leads that result in sales and commissions can be a powerful motivator. Be a presence at work. Feeling like you are part of something important and meaningful has the power to motivate people to accomplish great things. Think about the 1969 Mets or the 1980 Olympic AUGUST 2009
Men’s Hockey team. What would have happened if their managers didn’t show up for practice and left it to the players to do their own thing? It still takes an involved leader…and working side-byside with the boss can be motivating (or de-motivating depending on their personality). There are very few people who feel motivated to work for a boss who starts his or her day at 10 a.m. and waltzes out at three while everyone else is working till six. The same applies right now to the bosses who still take a lot of vacation time while complaining about everyone else’s productivity. Provide the right tools. Although the budget must be considered, providing your staff with the right tools to do the job can be a strong motivator. It is not unusual for employees to feel that they cannot do a good job because they are hampered by old, slow, or broken tools. The right tools can increase productivity and improve the way work is conducted. Working with the right tools often prevents frustration and removes the excuses and barriers to getting the job done. Much of the conflict and stress between managers and employees is caused by a lack of the right tools. Tools can be anything from computers to drill bits… software to self-tapping screws. Knowing when they get to work in the morning they will have tools they need to get the job done helps people get motivated to get their work started and completed…just as not having the right tools can lead to complaining, excuses, lost productivity and down time. Want some additional ideas? Here are the results, in order of preference, from a study that asked the question, “What do employees want from their jobs?” n Full Appreciation for Work Done n Feeling "In" on Things n Sympathetic Help on Personal Problems n Job Security OFDEALER
n Good Wages n Interesting Work n Promotion/Growth Opportunities n Personal Loyalty to Workers n Good Working Conditions n Tactful Disciplining Keeping your staff motivated is critical… and it is not just about performance, but just as often about employee retention. Even though it may not be possible or practical to provide every employee with the specific motivation they want, one of the best ways to determine what will motivate the majority of your staff is to ask them. It can be done one-on-one or through surveys. Gather the information and create a plan that is implementable. BUT…be prepared to do something…take some action…as asking and then not trying anything can be an even bigger disappointment and an obstacle to motivation. When I do training or speak to groups, I often refer to the term W.I.I.F.M. - what's in it for me... meaning of course, what's in it for the customer or your lead source, or even your boss or employee. I challenge the group to put themselves into the other person’s mindspace and consider the situation from their point of view. Why would they need your products or services? How would it help them or enhance their situation? Asking them to explain a "win" for them, in their terms, in their frame of reference, will often change the nature of the relationship into a more positive one. This doesn't just apply to selling. The owner who helps his or her staff accomplish what they need will often reap great benefits. The employee who helps his manager reach his or her goals will often be rewarded. Zig Ziglar said it so very well, "You can have everything you want, if you will just help enough other people get what they want." PAGE 23
DEALERPROFILE By Alicia Ellis
They say that good things come to those who wait. And, after three years of planning, strategizing, meetings and attorneys, Innerspaice’s wait is almost over. Within the next few months, the culmination of a merger between Imaginoffice and Corporate Design Systems and the subsequent purchase of Alabama Business Furnishings, will hit the ground running with all three companies housed under the Innerspaice name.
Friends and competitors for many years, Jim Vaughn of Imaginoffice, along with Harvey McCain and Mark Todd from Corporate Design Systems touted their product offerings to the entire state of Alabama and into the Florida panhandle. An opportunity from Haworth sweetened years of merger conversation and was the catalyst that would transform this dream into a reality. Two years, three teams of accountants and attorneys, eight facilities, six showrooms, and two warehouse spaces later, Innerspaice was formed in January 2009 as a Subchapter S parent corporation
with the three companies operating as LLCs under the name. Combining these three companies into one was no small feat. There were questions about employees, payroll, benefits, commissions, and so much more but today, eight months in, operations are running smoothly and when Innerspaice takes the lead and the LLCs are dissolved at the end of December, Innerspaice is poised to position itself among the largest dealers in the southeast. Built on the success of the three individual dealerships with combined sales of approximately $40 million in
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Project Profile } continued from page 24 2008 (a 20% increase over 2007), Innerspaice Architectural Interiors opens the doors to furniture sales through a dedication to non-traditional construction and sustainable products. “We have dedicated Architectural Interiors Specialists that do nothing but consult with contractors to develop raised flooring, demountable walls, modular electrical and other similar product opportunities, said principal Jim Vaughn. “This ultimately leads us to what used to be the core of our business…selling office furniture. The ability to sell more products to more people is the best path for growth in this economy and we are growing!” This dedication to architectural interiors and sustainability gives Innerspaice the ability to work with contractors at the very beginning of a project and allows clients to take advantage of the accelerated depreciation that comes with use of raised flooring and demountable walls. “Reduced construction and electrical costs, plug & play functionality, easy reconfiguring and earning LEED credits all play a role in getting the sale,” said Vaughn. “The ability to act as a subcontractor allows us to come in early
and once the workspace has been constructed, we can sell the components and furnishings that fit with the modular environment.” And, sustainable and cradle-to-cradle certified products are fast becoming a must-have for many of these projects. “It’s like a switch was flipped and everyone’s talking about environmentally-friendly products,” said Vaughn who explained that part of Innerspaice’s new company focus includes a commitment to sustainability in their offices and a redesign of all their showrooms with the goal to become LEED-certified. With more than 100 employees and a sales staff of 29 combined, Innerspaice has spent the past eight months developing company-wide policies and procedures. “We begin by learning from each other with a marketing theme ‘the power of three become one,’ and with three independent groups coming together, we have a lot of ‘best practices’ to measure against,” said Vaughn, who explains how compensation plans were developed to focus on the accomplishments and internal communications focused on highlighting significant wins
to recognize team members and encourage discussion among all employees. “A salesperson in our Fort Walton Beach, FL office can now read about a salesperson in Huntsville, AL who won a project that may be similar to one they are pursuing,” said Vaughn. “The immediate discussion that follows extends an invaluable education and increases the chance of winning again. As a company, we are our own best resource.” Despite the economy, Innerspaice’s project-driven approach to sales has shown no signs of slowing. “The best way to win is to listen,” said Vaughn who said that setting realistic expectations about Innerspaice, its services and its products enables customers to see the value in the company and stressed that now is not the time to be conservative. “The retention rate of talent in our group is unbelievable. We simply find ways to keep every team member interested and happy with their jobs and, as a result, people are literally on a waiting list to come to work for us. When things get better, we will be ready and intend on continuing to grow.”
Leading in Times of
Crisis know thyself Leadership’s #1 Commandment By Bill Kuhn
The title of an article in last month’s OFDealer caught my attention: Economic Downturn Could Change the Office Furniture Industry Forever. The title—particularly the word “could”—is an understatement, but fortunately most leaders and managers in the industry are taking notice and not hanging on to illusions or false hopes. Current events are creating major changes within our industry. As I write this column, in this week alone, dealers small and large have failed, and major contract furniture manufacturers have announced new record drops in revenue. Think back to the three-year crisis that began in our industry in the first quarter of 2000 and which, by the end of 2003, led to a drop of almost 40% in shipments. Bill Kuhn, principal of William E. Kuhn & Associates, is a noted industry consultant, writer, and speaker with over 35 years of industry experience. He consults with dealer principals and their management teams in areas of strategic planning, leadership and organizational development, marketing, financial management, valuation and merger/ acquisition. For more information, contact Bill by phone 303-322-8233, fax 303-331-9032, or e-mail: BillKuhn1@cs.com.
Now, within a period of just three to four months—not three years—our industry has plummeted to a percentage level comparable to the past—with no end in sight. And this collapse has occurred ten times as fast as in the beginning of this decade. While a few dealers are holding their own or showing only slight declines (a very few are showing increases), most are reporting a significant drop in revenue, some as much as 70%, and many are in financial crisis. Without question, the dramatic changes taking place in our industry today demand unprecedented restructuring, financial wisdom (which I covered in earlier columns this year), and leadership. During this crisis and when the industry recovers—remember, our industry will lag the national economic recovery—there will be a new style of leadership. The result of that new leadership will determine the future of dealers and manufacturers. I’ve written before about old paradigms and new prevailing paradigms, but primarily in terms of emerging industry practices and trends. It’s equally important to think about “personal” paradigms of past habits, behavior and management practices that no longer work today. continued on page 27
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Kuhn } continued from page 26 For dealer principals, a personal paradigm shift is occurring and will continue to occur—a change to a new way of thinking and adaptive behavior and leadership styles.
Do you have a strong desire—a passion—to achieve, and is that evident to your staff?
In last month’s column, I listed seven factors of effective leadership (see table). These factors can be grouped into two categories: managing one’s self and leading and directing your dealership.
Are you highly focused on doing the right things, putting first things first and changing with the times, or are you mired in the economy?
It’s time, and I emphasize—for the sake of your dealership’s survival and success—that you look hard at yourself. Your competence, your actions, and your behavior will determine the success or fate of your business. Sadly, I’m seeing failures and floundering in our industry that need not be.
What is your level of self-confidence, your own sense of self-worth and capabilities?
Factors for Effective Leadership
Can you truly read your own emotions?
Managing One’s Self
Know yourself
Possess a strong desire to achieve
Manage yourself
How do you really behave (including self-discipline and self-control) and how would others—employees, customers, contract furniture management personnel and outside advisors—evaluate your behavior as a role model?
Leading and Directing Your Dealership Set
Are you highly attuned to your inner signals and how they impact your organization?
Do you seek and get outside advice and consultation when needed?
a clear vision and direction
Become
a sensor (socially aware and able to empathize)
Delegate Be
While dealers may have failed recently because of financial conditions triggered by the economy, my own experience indicates that the cause of most dealers’ failing is because their leaders have not asked themselves these questions and determined how to lead and when to get help.
and empower
decisive, act promptly
Do you know yourself? If leadership’s first commandment is to “know thyself” as principal or the leader of a dealership, how aware are you of who you really are? While most would answer, very self-aware, most research shows that only about 10% should actually give that answer. Have you made a realistic self-assessment to determine your functional and technical competence (in sales, marketing, operations, finance and management) and identify your real strengths and weaknesses? Perhaps you might prepare a performance appraisal or job resume for yourself. But now comes the much tougher questions that involve some deep soul-searching. Every one of these questions must be carefully thought through by any leader of a dealership: Are you truly committed and involved in your organization (including approaching, not avoiding difficult situations and crises)?
What is your leadership style? There is no one perfect leadership style. You probably tend towards one of the six leadership styles mentioned by the renowned author and behavioral psychologist, Daniel Goleman. I have found no better book on leadership than his book titled, Primal Leadership, Learning to Lead with Emotional Intelligence. In the company workshops I have conducted, this book is required reading, and participants generally agree it is a real eye-opener. Think about which of the following six leadership styles fit you best, under- standing that any one of these may be appropriate in a particular situation. You don’t need to practice all six, but you will likely need to use differing styles at times. As Goleman writes, “leadership and emotional intelligence can be learned and improved at any age.” continued on page 28
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Kuhn } continued from page 27 1) Visionary. This style motivates people and builds commitments, is appropriate when change requires a new vision or when a clear direction is needed. (Quite applicable today.) 2) Coaching. This style focuses on personal development and is appropriate for improving performance by building long-term capabilities. (If you want the best performance from your employees especially if there have been reductions in staff, don’t fall into the trap of thinking that you don’t have the time to coach.) 3) Affiliative. These leaders are concerned with people, creating harmony, and building relationships. It is appropriate when motivating during stressful times, strengthening connections and repairing rifts within a team. (This style should not be used alone and can be used very effectively in conjunction with the visionary style.) 4) Democratic. A democratic leader values people’s input and gets consensus and commitment through participation, resulting in teamwork and collaboration. It is appropriate when building consensus and getting valuable input from employees, particularly when a leader is uncertain about what direction to take. (The democratic style is a slow process, not always
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appropriate in turbulent times, and leaders need to make sure advice comes from informed and competent sources.) 5) Pacesetting. This style sets challenging and exciting goals and demands high standards of performance. It’s appropriate when and only when there is a highly motivated and competent team. (Caution: This style sounds admirable but relentless demands can create high levels of stress and anxiety.) 6) Commanding. The command and control (military) style of leadership was common in business in the 20th century. It is appropriate only in certain situations of crisis, emergency, and urgent turn-around. (This style has the highest negative impact on climate and corporate culture and used with extreme caution.) For furniture dealers and manufacturers, the stakes are the highest I have ever seen in my decades in this industry and a great sense of urgency is required. Future columns will discuss the leadership planning, strategy, actions, timing, and development of other leaders in the organization. But it all begins at the top—with the dealer principal acknowledging and being committed to the #1 leadership commandment: Know thyself!
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Contract Dealers Pursue Alternatives to Drive Sales Selling office furniture has become problematic in this economy. As many businesses become reluctant to purchase anything beyond commodities, contract furniture is no longer essential. Project business requires a longer consultative process, has become harder to find, is increasingly competitive and in many cases, those projects are not as large or as lucrative as they were a short time ago. Contract dealers have reported project business to be off as much as 40% in the first part of 2009. As business moves into the third quarter, the trend is slowly leveling out, but not enough to lift spirits or sales sufficiently to change the day-to-day contract furniture business. “The rules of the game are changing,” suggests Rich Aievoli, vice president/general manager, furniture at United Stationers. “The project aspect of this recovery will take longer to come back than the small, medium and large transaction.” CWC-Atlanta reported a 10% decline in business last year. “Looking back that was pretty good compared to this year,” says Scott Marshall, vice president/sales. “We had a good first quarter because we had some jobs in the hopper, but I will tell you that it is rough out there right now.” CWC is still landing some project business but things are more budget conscious than they were in good times, and the number of competitors vying for the business has grown substantially.
With project business in a slump, dealers can sell their way out of this recession using wholesaler resources.
the
Last
word
michaelchazin Communications Manager United Stationers
“There are projects out there, people are moving and companies are relocating—it’s just harder to find them,” says Andy Stern, president of Andy Stern’s Office Furniture, Inc. With four retail showroom in Washington, D.C., and the surrounding suburbs, Stern says the business operates as a mid-market contract dealer. “A lot of our work is smaller to mid-size projects.” At Harris Office Furniture in Roanoke, VA, the outlook isn’t nearly as grim. “Southwest Virginia is somewhat insulated,” says Doug Hyre, president of Harris Office Furniture. “Other than the market being a little soft, there’s not a lot of noticeable change. There are still projects happening and while one or two have been delayed, by and large most of them seem to be going right on through.” The focus at Harris is primarily contract projects but the dealership still has walk-in customers that buy home office furniture or individual items such as chairs or file cabinets. Diversification has been the root of success for all of these dealers. Regardless of economic conditions, they are able to expand sales efforts beyond top-of-the-line contract work and pull in a full range of mid-market opportunities. Similar to other contract furniture dealers, CWC relies on United Stationers for a majority of the mid-market furniture it sells. Marshall states that CWC leaves no furniture opportunity unexplored, with showrooms that are open to the public and walk-in customers. continued on page 30
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Last word } continued from page 29 “We can talk about mid-market all day long,” said Marshall. “If we have a customer that needs something quick, clearly I have to go with a local source. If somebody needs ten offices tomorrow, we can deliver it, and United is going to be more likely than anyone to have it here. Obviously, I don’t want to get into the stocking business; carrying inventory is never good for a dealer, but particularly not in times like this.” Andy Stern’s Office Furniture doesn’t maintain a warehouse or a fleet of delivery trucks and outsources services such as receiving, storage, shipping and setup. “I rely on United Stationers to be my inventory subcontractor,” says Stern. “We tell everyone that we offer a huge selection of office furniture with large quantities in stock and immediate delivery. We rely on United to provide that, but as far as our customers know, we do it.” United has the depth of inventory, next-day delivery capabilities and a full array of marketing tools to simplify dealer efforts. “When you have a customer that needs 20 of something, and needs it quickly, you know United is going to have it,” said Stern. At Harris Office Furniture, United Stationers helps satisfy the immediate gratification factor that some of its customers bring to the table. “If they want it right away that’s when we use United Stationers,” says Hyre. “We’ve had people want to outfit seven offices by the end of the week. The only way to get that is through United Stationers.” Hyre uses United’s mid-market furniture catalog as a lead generator, leveraging the catalog’s broad offering as an entry point with many clients. Sometimes, a customer might be interested in a chair pictured in the catalog but eventually ends up ordering a similar product from another company that Harris represents.
“I don’t have to spend a lot of my marketing time and funds to build it.” One way to gain an advantage in the marketplace is through a price-oriented promotion, as more buyers are choosing to trade down. “We had two projects opt for lower-end and refurbished product instead of new Herman Miller,” says Hyre. The rules of the contract furniture business are in flux and the market is evolving. “United Stationers can help contract furniture dealers to sell their way out of the recession faster with access to a wide range of products,” explains Aievoli. Having access to United Stationers’ broad product mix means that dealers can consolidate their ordering. “If a customer needs to outfit three different areas in an office, they can look at our portfolio and buy from multiple manufacturers,” said Aievoli. “Dealers place one order with us and get one consolidated delivery and one consolidated invoice.” By increasing marketing and using a wholesaler’s broad product line-up to their advantage, dealers can successfully expand their business—even in a down economy.
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“Still, it is probably the one catalog we give out the most,” says Hyre. To help generate sales, his salespeople hand-deliver the catalogs to accounts. CWC uses United’s Mid-Market Furniture catalog as a tool to diversify the company’s approach. This summer, CWC ordered United’s 16-page Alera flyer for the first time. It features aggressive consumer pricing on selected Alera furniture items, a United Stationers’ furniture brand. “Quite frankly, these are different times,” says Marshall. “Accordingly, different approaches are needed. We need to have more people on the street to drum up day-to-day business.”
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The Alera flyer offers a great vehicle to get into the marketplace with a price advantage. “And it is a pre-built tool,” Marshall adds. AUGUST 2009
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