The Enterprise - Utah's Business Journal, Nov. 21, 2011

UTAH’S BUSINESS JOURNAL www.slenterprise.com

THIS WEEK $5.2 million being invested in downtown Radisson hotel See page 3.

• Industry Briefs •

Nov. 21-27, 2011

Living Planet to construct new aquarium in Draper

Salt Lake developer to buy 180 acres in Syracuse City

By Barbara Rattle The Enterprise

The Ninigret Group LC, a diversified Salt Lake City-based real estate developer, has inked a definitive agreement to purchase roughly 180 acres of raw ground in Syracuse, where it plans to develop a major commercial and multi-family housing project.

Randy Abood, company chairman, said he was not at liberty to disclose the name of the seller of the land, located north of Syracuse High School, between 1000 West and 2000 West.

“There is what we perceive to be a demand for commercial and multifamily housing up there,” said Abood, whose firm developed the sprawling Ninigret Park commercial business park in Salt Lake City. “Part of it is the spillover from what’s already up there and we see other situations there, including a city that wants to maintain its employment base.

DesignMatters Matters Legal

Begin on page 5.

• Calendar • See page 6.

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Volume 41, Number 17

A rescued green sea turtle captivates youngsters at the Living Planet Aquarium in Sandy.

So we were given the opportunity to buy the property and we like what we see so far.”

Abood said he would like to begin developing the acreage in phases, depending on the strength of the market.

“The greater part of it would be our typical Ninigret commercial — industrial, distribution and manufacturing — and there’s some 30-plus-or-minus acres that we would allocate for multifamily residential,” Abood said. “I think there’s going to be a combination of building for our own account and then selling big chunks of it as well. It depends upon the number of sales that are out there. So [the length of time to develop] is not going to be less than three years and hopefully it’s not more than seven or eight years.”

Abood said very rough estimates of the scale of the

Executive Lifestyle Executive Lifestyle Legal Matters

Executive Lifestyle See page 8.

By Barbara Rattle The Enterprise

The Living Planet Aquarium, a 43,000 square foot nonprofit aquarium that is open to the public, plans to construct a new and larger facility in Draper beginning next spring.

Draper City last week approved a memorandum of understanding pursuant to which the city will issue an approximately $11 million tax-exempt bond on which the aquarium will make the payments, according to Draper City manager Layne Long. An

additional $7 million raised from donations and by fund-raising will be supplied by the aquarium, said Living Planet CEO Brent Andersen.

According to Andersen, the aquarium is in the final stages of negotiating the purchase of land for the new aquarium, which will replace its current facility in Sandy.

Andersen said he was bound by a nondisclosure agreement to refrain from identifying the site that will be purchased, other than to say it is near the freeway in Draper.

see NINIGRET page 2

Construction under way on Best Western Plus near airport

Legal Matters Legal Matters Matters Legal see AQUARIUM page 2

Study: negative blog posts can have positive impact on business

StaffingMatters Matters Legal

It seems counterintuitive, but when it comes to employee blogs, sometimes the best posts contain moderate criticism of corporate policy, service or even products, says a new study from the University of Utah.

“If the [negative] ratio is too high, they can talk with those employees about their concerns.

But while they should monitor those blogs, they should not stifle all criticism,” said Rohit Aggarwal, assistant professor of information systems at the university’s David Eccles School of Business and coauthor of the study.

He notes that while some companies have reprimanded or even fired employees over “negative” posts, others have adopted

policies tolerating or even encouraging criticism.

In “Blog, Blogger, and the Firm: Can Negative Posts

by Employees Lead to Positive Outcomes?” which has been accepted for a forthcoming edition of the Information Research Journal, Aggarwal contends that “our analysis suggests that negative posts act as a catalyst and can exponentially increase the readership of employee blogs.”

Visitors to corporate/employee blogs do not expect to see anything but positive commentary on company products and services.

Critical commentary is seen as reflecting integrity of employees

The Best Western project was able to move forward when developers secured financing from Bank of Utah.

Ground was broken in mid- level of confidence with us,” said September on a Best Western Patel, who purchased the 1.61Plus hotel at 5433 W. Wiley Post acre lot in 2008. “We went to more Way in Salt Lake City near the than 10 different banks, every one Salt Lake International Airport, we could think of. We expect to according to co-owner Tom Patel. have 60 percent occupancy during

The project has been in the first few weeks the hotel is the works for more than three open, and our goal is to maintain years, but Patel and partner Mike 75 percent occupancy, which we Chaudhari had difficulty getting think is very feasible.”

The 45,933 square foot projfinancing until a few months ago from Bank of Utah, which had ect, slated for completion in May financed some other projects for 2012, was designed by Denverbased Associated Architects and is them in the past.

“[Bank of Utah] has a strong see HOTEL page 3

Real Estate Matters Legal Matters see BLOGS page 2

2

BLOGS from page 1

and honesty and openness from the company about their products or services.

“There is some merit in allowing negative posts” by company blogging policysetters, suggest Aggarwal and co-authors Ram Gopal and Ramesh Sankaranarayanan of the University of Connecticut and Param Vir Singh of Carnegie Mellon University. “Permitting a few negative posts to increase readership should be a good strategy.”

Aggarwal and his colleagues also found that while a few negative posts served to season perceived legitimacy of corporate/ employee blogs, too many negative blogs can reverse that initial, favorable reaction from readers.

In other words, all things in moderation – including online criticism.

“We found that the optimal percentage for negative posts is about 15 percent to 20 percent,” Aggarwal said. “Beyond that, you may get more readership but there also is more negative impact on

the company in terms of reputation and possibly sales.”

So, what does the research suggest for executives in the process of drafting or re-writing their policies on blog content? In a word: vigilance.

“We are not advocating, for instance, that a firm should actively encourage its employees to post negative comments on their blogs.

Firms may not choose to restrict certain types of negative posts, which is different from actually encouraging negative posts,” the paper states.

That said, Aggarwal adds that his research suggests that companies should be more open toward “allowing employees more freedom to write and freedom to express” even as they “track blogs to see what the ratio of negative posts is to positive ones.”

A high negative-to-positive blog post ratio can also serve as a canary in a coal mine, allowing a company to proactively react to brewing discontent among employees. “If the [negative] ratio is too high, they can talk with those employees about their concerns. But while they should monitor those blogs, they should not stifle all criticism.”

Nov. 21-27, 2011

The Enterprise

AQUARIUM from page 1

The new aquarium, which Living Plant will own, will measure 90,000 square feet.

“Everything will be much bigger and better. The shark tank will be almost half a million gallons — actually big enough that people can dive into it with the sharks,” Andersen said. “We’ve just completely outgrown what we have in Sandy. One of the great things about the Living Planet is we’re a nonprofit but because we have such strong support from the community — visitation, memberships, ticket sales — that we’re actually able to cover all of our overhead. What that really means is that when donations come in they go straight toward whatever they were destined for without having to take off any operational support [funds] from

them. Our donations tend to go a little further, and that’s because of the strong operations model that we have.”

A groundbreaking is slated for April or May and the Draper facility should take a year to complete. Andersen said an architect and general contractor have yet to be selected.

The Living Planet was launched at The Gateway in downtown Salt Lake City in June of 2004. It had a 10,000 square foot location there. The aquarium was moved to its current location in Sandy in June of 2006.

“Since then we’ve just kept growing and growing and are out of room there,” Andersen said.

“But this will be the last time we move; I really don’t want to move again. I’ve known this from day one, that both Gateway and the current site were not going to be the final site. Everything’s been built and designed to be moveable

— not easily moveable, but we will move it to the new facility.”

Andersen said the Sandy location is at capacity quite often.

“When we brought penguins in, there were days when there was a 30, 40 minute wait just to get in the building. That sounds like a good thing but it’s actually not that great for a visitor experience,” he said. “We want them to be able to get in and have a great time with their family. We’ve got a very small parking lot and on those busy days it’s really hard to find a places for them. Also, and this part is crucial when an aquarium gets to a certain size, you have to keep adding something new, every 14 to 18 months or so. At most aquariums nationwide those come in the form of what’s called a changing exhibits gallery. We don’t have any room for something like that at the current space.”

BRO1-92 HERITAGE

One of the building's in Ninigret's 2.3 million Ninigret Park in Salt Lake City.

NINIGRET from page 1

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development include about two million square feet of industrial space and as many as 600 units of multifamily housing.

“The two million square feet is a little bit smaller than Ninigret, which was 180 acres, but I think we’ll probably have a lower percentage of building volume per acre,” he said.

The Ninigret Group is now “playing with names” for the

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future development, Abood said.

“What I really want to add to this is the notion of Antelope Island,” he said. “I want to capture Antelope in there somewhere. I want the Ninigret name and I want the Antelope symbol built into it.

One can immediately identify with Antelope Island.”

Ninigret Park consists of nearly 2.3 million square feet of industrial and office space consisting of 18 buildings ranging in size from 60,000 to 278,000 square feet. The park’s office buildings feature “plugand-play” flexibility with raised access floors to accommodate under-floor HVAC, dual fiber, redundant generator capacity and easy access to electrical and telecommunications wiring systems. Warehouses have high ceilings, extra doors and docks, super flat floors and other features that are typically found in customconstructed warehouses.

The Enterprise

Nov. 21-27, 2011

Radisson Downtown to receive $5.2 million interior renovation

For-rent production studio to open in WVC

Bare Studios, a new for-rent corporate production studio, is slated to open in January in about 11,000 square feet at 2210 W. Alexander St., West Valley City.

Company president Greg Branin said the venture is being financially aided by a group of Las Vegas companies that are acting as silent partners.

Branin described the facility as ideal for corporate video productions and photo shoots, as it will house a multimedia studio

with a stage and light production capabilities.

“There are no employees because as the name implies, it’s bare. You lease the facility and that’s pretty much it,” Branin said. “There isn’t anything like it in the valley. There are some smaller studios and there are some studios where you go and they do the full production for you. But a lot of people don’t need that, they have their own in-house video and photography guys and marketing

3

guys. They don’t need an entire production, they just need the space to be able to do it. We’re considering having a coded access door and you just go in and punch in the code and there’s a studio you can use.”

A brochure-style website is being developed for the new business, which leased its location with the assistance of Josh and Bob Mills at Commerce Real Estate Solutions.

Several buildings under construction at BDO

A major renovation project at the downtown Radisson is slated to begin today, Nov. 21.

A major renovation is scheduled to begin Nov. 21 at the Radisson Salt Lake City Downtown hotel, according to general manager James Courtney.

The $5.2 million project is being done by Salt Lake-based Cameron Construction and will encompass 250 of the hotel’s 381 guest rooms, along with a renovation of the main lobby. Degen and Degen of Seattle is the design firm for the lobby and guest hallways and bathrooms, while LLdP of Sweden developed the room concept for Radisson, which Courtney called the “Urban Room” design.

“It will be a very contemporary, vibrant style for the guest rooms and lobby – it will be quite striking,” said Courtney, who has been hotel general manager for six years. “We’re thrilled to be getting this upgrade. The timing is good and it will be beneficial to our guests.”

Courtney said the hotel installed 37-inch flat panel TVs earlier this year and all furnishings are new.

HOTEL from page 1

being built by Springville-based M-13 Construction. The hotel has a construction cost of just over $4 million, with the overall project cost closer to $5.6 million.

The three-story structure will feature 81 total rooms, including 28 suites, with an average room size of 350 square feet. The exterior is a combination of EIFS, stucco and stone, with interior finishes of paint, wallpaper and an acrylic texture. Amenities include meeting and boards rooms, s fitness center, an indoor pool and spa, 42-inch LCD televisions in each room, along with complimentary continental breakfast and shuttle service. The hotel is geared mainly for business travelers and those traveling along I-80 through Salt Lake City, Patel said.

“We’re taking it down to the walls,” he said. “It will be new carpet, vinyl, new beds, chairs, desks, artwork, granite vanities and new mirrors with built-in lights. It’s something that has been in discussion for three years; we’re excited for it to begin.”

The construction schedule will be very aggressive, with the first phase slated for completion

by Dec. 15. Courtney said the hotel is trying to get as much work done during the Thanksgiving and Christmas holiday season, which is typically a slower time for the industry. The 250 rooms will hopefully all be finished by midJanuary. Later in the spring of 2012, the hotel will renovate the porte-cochère and the entryway to the hotel, which was originally constructed in 1982.

THE ENTERPRISE [USPS 891-300] Published weekly by Enterprise Newspaper Group Inc. 825 N. 300 W., Suite C309, Salt Lake City, UT 84103 Telephone: (801) 533-0556 Fax: (801) 533-0684 Website: www.slenterprise.com.

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Construction of three new building in Business Depot Ogden has either begun or soon will.

Big-D Construction has been chosen as general contractor to erect a 78,000 square foot call center for Home Depot Inc., which recently received an incentive from the state to create 691 new jobs in Ogden. GSBS Architects designed the Home Depot facility, to be located at 801 S. Depot Dr. It is slated for completion next June.

Also under construction in

BDO is a 160,000 square foot tilt-up concrete structure that will house multiple tenants, according to BDO general manager Blake Wahlen. He said the building is about 70 percent leased; tenants will include McKenzie Exhibit (50,000 square feet) and Powder Processors (40,000 square feet).

Big-D is the general contractor on this structure as well.

Nearing completion at BDO is a 32,000 square foot flex building being constructed

Steed Construction

by E.K. Bailey Construction. It is also about 70 percent leased, Wahlen said. Tenants will include Universal Cycle, Memory Works and Depot Daycare.

Business Depot Ogden, a division of Salt Lake City-based The Boyer Co., is a 118-acre master planned business park with 500 build-to-suit available acres. BDO has 860,000 square feet of new construction, 6.5 million existing square feet and 1.8 million square feet of available space.

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4

The Enterprise

David Bradford named CEO of HireVue

HireVue, an Draper-based provider of on-demand interviewing technologies, has hired David Bradford as CEO. Bradford assumes the position from Mark Newman, who remains with the organization as its founder.

Until April of 2010, Bradford served as CEO of Fusion-io, developer of a new storage memory platform. He continues to work with Fusion as chairman of its Strategic Advisory Board.

Previously, Bradford served as

senior vice president and general counsel of Novell Inc.

Users of HireVue can browse, watch, rate and share the interviews they want, on their own time, similar to streaming their favorite movies and even from a smartphone. Recognized by HR Executive magazine as a Top HR Product of 2011, HireVue’s Digital Interview Platform also helps improve interviews of all types, including in person, phone and video interviews.

Power systems firm to expand into 59,000 sq. feet

Goal Zero, a manufacturer of portable solar power systems for various USB, AC and DC devices, plans to move to a nearly 59,000 square foot facility at 675 W. 14600 S. in Bluffdale in January.

The firm is currently located in 14,000 square feet, said company president Joe Atkin.

“You kind of wait until you’re stacked like sardines to be able to make a move like this,” Atkin said. “Obviously, it’s expen-

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sive. But basically it gives us growth for four or five times what we’re doing today. Right now we have about 3,000 square feet of office space. That will go to 12,000 square feet. We’ve grown in employees from about eight last year to over 60 and as sales increase I’m sure we’ll have to add on more people.”

The company, founded in 2007

by Utah resident Robert Workman, has experienced phenomenal growth since it started selling products in 2009, with projected revenues of well over $10 million in 2011.

“When we talk about the mission of Goal Zero and what we’re doing, our mission is to empower people — with products and with a good stable job,” Atkin said. “We’re finding that consumers are ready for our products so we’re cranking up to meet that demand.”

Currently located at 14864 Pony Express Road, Goal Zero leased its new building with the assistance of Michael Jeppesen and Jeremy Jensen of IPG Commercial Real Estate.

In the greater Salt Lake market, job growth and positive signs in the housing market indicate potential improvement in 2011, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the U.S. housing market.

Over the past 12 months, there have been a total of 22,600 new jobs created in the market, which is an annual growth rate of approximately 2.3 percent.

“While the national economy remains weak, there are a few bright spots, one of which being the greater Salt Lake market. The greater Salt Lake market has recently been highlighted by many economists as one of the healthiest markets across the nation,” said Eric Allen, director of Metrostudy’s Greater Salt Lake Division.

Annual new home starts for the greater Salt Lake market totaled 4,577 as of 3Q11, which

is a 10 percent decrease compared to the annual pace last year at this time. Annual new home closings have also declined, to a total of 4,743, which represents a 27 percent decrease compared to last year’s pace and 5.2 percent from last quarter.

“However, when comparing quarter over quarter, new home starts have shown improvements,” said Allen. During the third quarter, builders started 1,443 new homes, which is an increase of 22 percent compared to 3Q10, and 43 percent above last quarter (2Q11).

“At this time last year, the market was benefiting from the surge of the tax credit, therefore new home closings were much higher than today, thus resulting an increase in the supply of homes,” said Allen. The number of finished vacant single family homes has decreased just over 27 percent compared to last year to 532 homes; however the supply has remained nearly unchanged at a low 1.9 months.

“The Greater Salt Lake market is receiving much praise as being one of the strongest and most healthy markets around the country, and the results are beginning to resonate throughout the housing market,” Allen said.

Report: greater Salt Lake area an economic 'bright spot'

UTAH’S BUSINESS JOURNAL

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Nov. 21-27, 2011

At The Gateway, we believe that when you work hard, you deserve some perks. That’s why The Gateway, FM100 and The Enterprise have created and exclusive “Office Worker At Work Perk Card” for all of you hardworking people. (Fill out your At Work Perk Card application at The Gateway Concierge desk.)

Flash your card and get savings and discounts at participating shops and restaurants at The Gateway.

Just keep your card in your wallet and look for special deals throughout The Gateway. FM100 will be e-mailing you ever Monday with the “Perks of the Week.” Log on to www.fm100.com or check out The Enterprise for the most up to date list of specials.

Turn in your completed form to The Gateway Concierge, located across from Urban Outfitters or to any participating retailer to be eligible for monthly drawings.

ASSOCIATIONS • ChamberWest, the region-

al chamber of commerce for the West Valley City, the City of Taylorsville and Kearns Township area, is launching a sister chamber of commerce to service business members in Millcreek Township. Named the East Valley Chamber of Commerce, the new regional chamber is officially recognized by Millcreek Community Councils and Salt Lake County and will initially represent the business community of Millcreek. The chambers will operate individually yet with shared membership and shared benefits and host area specific multi-chamber events and functions.

COMPUTERS/ SOFTWARE

• Solera Networks, a South Jordan-based creator of network security analytics platforms, has appointed Rick Simmons vice president of North American sales. Simmons will guide the team responsible for the company’s recent triple digit sales growth. Simmons brings more than 25 years of executive sales experience to the position, having led several organizations to record revenue growth and worldwide expansion. Simmons comes to Solera Networks from Bit9,

5

The Enterprise

Nov. 21-27, 2011

• Industry Briefs •

where he led Federal Government & Southeast area sales. Prior to that, he was vice president, North America sales at E2open where he oversaw the major account relationships and increased revenues 75 percent.

• ThomasARTS, a Farmington-based direct-growth marketing company with offices in Utah, California, Minnesota, Texas and New York, was honored at the annual Public Relations Society of America Golden Spike Awards ceremony, held Nov. 9 in Salt Lake City. ThomasARTS received the Golden Spike in the research category for work with the Zions Bank Emerging Markets Research Project. The agency also received finalist recognition in the competitive print communications category for the Utah Valley Convention and Visitors Bureau Annual Report.

• Sabrina Stover, CEO of American Fork-based BidSync, a provider of government e-procurement, e-sourcing software and bid notifications, has been honored as finalist in the Stevie Awards for Women in Business.

Stover was named as a finalist for the category of Best Executive – Service Businesses – Up to 100 Employees - Computer Services, Software & Telecommunications.

LAW

• Kristin L. Aldred has joined Fabian Law as an associate. Aldred graduated from the University of Virginia School of Law in 2005, where she was on the managing board of the Virginia Journal of International Law and a semi-finalist in the school’s annual Moot Court competition. Prior to law school, she graduated magna cum laude from Rice University with majors in

English and Religious Studies.

She previously practiced law in Texas for five years and completed a two-year federal clerkship with district judge Ewing Werlein, Jr. in 2007. Aldred is a member of the firm’s Complex Litigation, Employment, Energy & Utilities and Environment/Natural Resources practice groups.

• Robert E. Mansfield, a partner in the Salt Lake City office

of Snell & Wilmer, has been named the Republic of Korea’s Honorary Consul for the State of Utah. The appointment comes after a lengthy, multi-year process of being approved for his new role by both the Consul General of Korea in San Francisco, the Korean Embassy in Washington, D.C. and ultimately, the U.S. State Department. Mansfield’s earliest continued on page 7

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Gov. Gary Herbert paid a visit to West Valley City-based Wheeler Machinery on Nov. 9 to mark the 60th anniversary of the Caterpillar and construction equipment dealership. As part of the tour, the governor got an up-close look at Caterpillar’s new CT660 vocational truck, currently the first and only one in the state of Utah. Herbert also saw first-hand the power of Wheeler’s state-of-the-art dynamometer facility. Capable of testing both diesel and natural gas engines with up to 5,000 horsepower, it is the only certified dyno of this level in the western United States.

“By providing a great product and great service … the added value to us here in Utah is they add to the economy in such a significant way,” Herbert said. “With 300 people employed here in the Salt Lake City area, that means they’re providing income and resources for families that ripples through our economy. The CAT equipment we have here [at Wheeler Machinery Co.] is just a boon to mankind… it’s hard to even comprehend how much dirt we move with these big pieces of equipment. And thanks to people like Wheeler Machinery, our economy continues to expand here in Utah and we’re creating jobs and a better quality of life.” Pictured left to right are Spencer P. Eccles, Rob Campbell, Gov. Herbert and Paul Campbell at Wheeler Machinery Co. in front of the new Caterpillar CT660 vocational truck.

The Enterprise

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• Calendar •

• Nov. 30-Dec. 1, 7:30 a.m.12:30 p.m. both days: “Real Estate Investment Analysis,” an eight-hour CORE commercial real estate education course conducted by NAIOP. The course is designed to provide the technical skills necessary to analyze the financial feasibility of real estate investment opportunities. Valuation techniques such as direct capitalization and discounted cash flow analysis are introduced first, followed by an examination of debt financing’s impact on real estate investments.

Location is the Spencer Fox Eccles Business Building, Room 110, at the University of Utah in Salt Lake City.

Cost is $125 for NAIOP members, $150 for nonmembers. Register at http://bit.ly/NAIOP8HrsCoreCE.

• Nov. 30, 4-7 p.m.: Salt Lake Chamber Open House. The chamber and its strategic partner, the Downtown Alliance, will show off their newly redesigned office suite. More than a dozen firms will cater the event, which will feature local performers.

Location is the chamber offices, 175 E. 400 S. Free. For more information, contact cdevore@slchamber.com or call (801) 328-5055.

• Dec. 1-2, 7:30 a.m.-6 p.m.

Thursday, 8 a.m.-noon Friday: The Summit Director and Officer Training Conference, presented in partnership with the Utah chapter of the National Association of Corporate Directors (NACD). The event is designed for board chairs, corporate directors and senior executive officers of publicly traded corporations and corporations growing towards publicly-traded status. Participants will gain insight and receive substantive instruction on topical issues in corporate governance that affect publicly listed companies and board members. With participation from leading executives, corporate directors, policymakers, and experts from the legal and financial services industries, along with academic authorities from the Brigham Young University Marriott School of Management, the Summit Conference will teach participants how to develop a framework for making informed board decisions and

exercising sound business judgment. Presenters will include Steven Walker, NACD; George Feiger, Contango Capital Management; Les Brorsen, Ernst & Young LLP; and Joan Woodward, Travelers. Location is the St. Regis Ceer Valley Resort, 2300 Deer Valley Dr. East, Park City.

Cost is $550. Register at http://www. summitconf.org/register.

• Dec. 8, 3:30-5:30 p.m.: “How to Raise Money,” sponsored by the Wayne Brown Institute and VentureCapital.org. At the event, several items will be discussed, including current trends, the basics of the fundraising process, finding the right investor, and how to raise capital from the perspective of a serial entrepreneur and an investor. An open Q&A session will follow. Location is the law offices of Holland & Hart, 222 S. Main St., Suite 2200, Salt Lake City.

Free.

• Dec. 8, noon-1 p.m.: “Protecting Your Innovations After the Leahy-Smith America Invents Act,” a panel discussion hosted by Kirton & McConkie. The LeahySmith America Invents Act is the first large-scale U.S. patent law reform in 60 years that will dramatically reshape existing patent laws. While the Act creates streamlined alignment between U.S. patent law and international patent laws, it also significantly changes the landscape for obtaining and enforcing patents. A panel presentation will explore some of the changes from this Act and the implications on products and inventions. The panel will include Jill Powlick, corporate intellectual property counsel at Idaho Technology Inc.; Sally Brown, patent counsel at Autoliv; and James Larson, corporate and IP counsel at Innovative Medical Device Solutions. Moderator will be Ken Horton, a shareholder at Kirton & McConkie. Location is the Kirton & McConkie offices, 60 E. South Temple, 16th floor, Salt Lake City. Free. Lunch will be served.

RSVP by Dec. 6 with Cynthia Kersey at (801) 323-5966 or via e-mail to info@kmclaw.com. Register at www. venturecapital.org.

THE

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UTAH’S BUSINESS JOURNAL

Amer. Fork .... 748 E. State Rd............... 801-756-6000

Ogden ............458 Wash. Blvd. ............. 801-393-8481

S.L.C...........178 E. South Temple ......... 801-519-8241

Bountiful ......... 400 W. 500 S................. 801-292-2111

S. Ogden ...... 5734 S. Harrison ............. 801-476-7066

S.L.C.................4546 S. 900 E. ............... 801-262-4626

Brigham City.....390 S. Main ................. 435-734-9429

Orem (Univ. Mall)1195 S. State St. ........801-802-0541

Sandy ..............8835 S. 700 E. ............... 801-566-1177

Centerville .....220 W. Parrish .............. 801-295-0531

Orem .............. 703 N. State St............... 801-224-1177

S. Jordan...10227 S. Redwood Rd. ...........801-446-5444

Draper ...... 1022 E. Draper Pkwy.......... 801-523-9300

Payson ........... 1146 W. 800 S. .............. 801-465-9934

Spanish Fork. .. 570 N. Main................. 801-798-9827

Kaysville........ 320 N. Main St. .............. 801-546-1326

Price .........790 W. Price River Dr. ........ 435-613-2446

Springville...... 495 S. 1750 W................ 801-489-5577

Kearns ........... 3725 W. 5400 S............... 801-964-9935

Provo .......1595 N. Freedom Blvd. ....... 801-374-1177

Tooele............ 855 N. Main St. .............. 435-882-4061

Layton....... 1159 W. Antelope Dr. ......... 801-776-5560

Richfield ............208 S. Main ................. 435-896-8473

Tremonton ........55 N. 300 E. ................. 435-257-3395

Lehi ...................144 N. 850 E. ................ 801-766-1806

Roosevelt ....... E. Highway 40 ............... 435-722-5561

Vernal ............. 1265 W. 500 S................ 435-789-8872

Logan...............240 E. 1400 N. .............. 435-752-4622

S.L.C................. 910 S. 300 W................. 801-322-1043

W. Jordan ..... 3176 W. 7800 S............... 801-565-0031

Murray ..........4745 S. State St. ............. 801-262-2436

S.L.C......... 2284 E. Ft. Union Blvd. ........ 801-733-4242

W.V.C. ............ 3557 S. 5600 W............... 801-967-6404

Nephi ................855 E. 100 N. ................ 435-623-0300

S.L.C..............3120 Highland Dr ............ 801-467-5461

W.V.C. ............ 2830 W. 3500 S............... 801-967-7166

N. Ogden ... 1893 N. Wash. Blvd........... 801-737-4781

S.L.C................2002 E. 3300 S. .............. 801-487-1028

Woodscross .. 1398 S. 500 W................ 801-292-1439

A little bird told me... follow us on

www.bigotires.com #3095_BOT_BUS2BUSVIP_AD_Rev2.indd 1

Nov. 21-27, 2011

10/19/11 4:49 PM

@TheEnterpriseUT

from page 5

experience with Korea was his military assignment in the early 1980s with the Combined Field Army unit in Ui Jong Bu. This unit involved Americans and Koreans working side by side on various strategic projects. He has continued his involvement with Korea, and since being selected as the Honorary Consul, Mansfield has returned to Korea for a weeklong orientation with the Ministry of Foreign Affairs and re-orientation to the country, and noted the incredible economic and infrastructure progress in the advancing country. In his new role, Mansfield will work closely with the Utah Korean community in pursuing their organizational agenda. He is also planning economic development events that will engage Utah companies involved or interested in doing business with Korea.

MANUFACTURING • Pepperidge Farm, a part

of Campbell Soup Co., plans to create 54 new jobs at its existing facility in Richmond due to increasing demand for its Goldfish crackers product line. The existing Richmond facility has been in continuous production since 1974. Expansion of the facility will commence in 2012, with production scheduled to begin in 2014. The company expects to invest up to $45 million in capital improvements over the course of the project. The state has authorized a 10-year, post-performance, single-payer refundable tax credit of $475,032 over the life of the project. The 54 jobs created will pay at least 100% of the county average wage and will pay new state wages in excess of $18.9 million.

• ThomasARTS, a Farmington-based direct-growth marketing company with offices in Utah, California, Minnesota, Texas and New York, was honored at the annual Public Relations Society of America Golden Spike Awards ceremony, held Nov. 9 in Salt Lake City. ThomasARTS received the Golden Spike in the research category for work with the Zions Bank Emerging Markets

7

The Enterprise

Nov. 21-27, 2011 Research Project. The agency also received finalist recognition in the competitive print communications category for the Utah Valley Convention and Visitors Bureau Annual Report.

MEDIA/MARKETING • Penna Powers Brian

Haynes (PPBH), Salt Lake City, earned five gold and six finalist awards at the annual Public Relations Society of America Golden Spike Awards ceremony in Salt Lake City. The firm won a Golden Spike Award for its “Boost ‘til 8: Kyle’s Story” video for UDOT and the Utah Department of Public Safety and for its Express Pass Education Campaign that promoted a program allowing solo drivers to pay an adjustable fee based on congestion to use the remaining space in the under-utilized carpool lane was new to Utah. The Pioneer Crossing DDI Public Education Campaign & Pioneer Crossing DDI Movie Theater Spot for UDOT also won a Golden Spike, as did a Sam White Bridge Move piece for UDOT.

• Intrepid, a Salt Lake-based Hybrid communications agency, garnered 11 Golden Spike Awards, including Best of Show, and five finalist honors. The firm claimed more Golden Spike Awards than any other agency, corporation, government entity or nonprofit organization. Intrepid

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was awarded Golden Spike Awards for public relations, advertising, interactive and social media for clients, including Mountain Medical, UDOT, Elizabeth Smart and Hale Centre Theatre. Intrepid received Best of Show honors for its use of direct marketing to promote Mountain Medical’s affordable quality imaging services to referring physicians. The marketing strategy received a perfect score from both judges.

growing take-and-bake pizza chain, has opened five new stores along the Wasatch Front. The new Papa Murphy’s stores are located in Salt Lake City (150 E. 3300 S. and 1645 W. 700 N.), Layton (765 West Antelope Dr.), Clinton (1952 N. 2000 W.), and Springville (655 E. 400 S.)

of commercial real estate brokerage CBRE has added four new employees. Jennifer Berriochoa is client services coordinator for the Scott Wilmarth and Tab Cornelison team. Hailey Crickmore is assistant real estate manager in Asset Services. Bethany Sommer is client services coordinator for the Eric Smith and Kreg Peterson team. Jessica Worth as client services coordinator for the Craig Thomas and Eric Gustafson team.

and will carry the same product selection that is available on the Overstock.com website. To download the app visit itunes.apple. com/us/app/o.co-mobile-shopping/id339883869?mt=8&ignmpt=uo%3D4. Customers will be able to filter their search results by top sellers, review ratings, price and new arrivals. The app also includes pinch zoom, swipe left/ right and up/down, and infinite scroll.

RESTAURANTS

SCIENCE • Great Basin Corp., a West

RETAIL • Online retailer Overstock.

com Inc., Salt Lake City, has

launched its free O.co iPad appliREAL ESTATE cation. The new application can • The Salt Lake City office be found on the iTunes website

• Papa Murphy’s, the country’s largest and fastest

Valley City life sciences com-

pany developing sample-to-result molecular diagnostic solutions, has submitted a 510(k) application to the U.S. Food and Drug Administration (FDA) for its first molecular diagnostic test for Clostridium difficile (C. diff).

C. diff is one of the most common and deadly hospital-acquired infections, impacting approximately 700,000 people in the U.S. annually, according to the Centers of Disease Control and Prevention.

The company also plans to submit an application to European Union regulatory authorities before the end of 2011 to obtain CE Marking for the C. diff test.

TRANSPORTATION • A new Larry H. Miller Chrysler Jeep Dodge Ram Riverdale dealership opened Nov. 15 at 1481 W, Riverdale Road in Riverdale. Featuring an expanded customer waiting lounge and guest service area, the location also includes three times the available service bays from the present location. The dealership’s general manager, Troy Bullard, has been with the Larry H. Miller Group for six years.

2010 Book of Lists

Now available for $85 Call 801.533.0556 to order today

8

Nov. 21-27, 2011

The Enterprise

Executive Lifestyle Executive Lifestyle Legal Matters Is it safe?

It doesn’t seem to matter whether I am going to Cancun or Cairo, the question I’m asked more than any other is “Do you think it’s safe to travel there?” I hate to say it, but Americans are the biggest fraidy-cats in the world. I think maybe it has something to do with sensationalized television news reporting; but in any case, people who live in the United States worry more about safety than anything.

If you want to be completely logical about it, Cancun is about 1,500 miles from the U.S.-Mexican border, which is where the drug fighting is going on. When there is a problem in Chicago, does that really have an effect on our safety in Salt Lake City? And don’t get me started on the issue of safety in downtown Salt Lake versus, say, Egypt. Think about it: does the fact

parking across the street from the aforementioned scene of the crime?

The last time an American was injured in Egypt was while stationing herself in the midst of a riot 10 months ago. Last I heard, the revolution was over. We’ve had more Americans killed or injured

by TRAX trains in the last month than have been killed or injured in all of Israel and Egypt combined in the last 10 years. So, give me a break!

I mention Israel and Egypt because it just so happens I am leading a tour to those two places starting Dec. 28. We have this fabulous itinerary arranged: first, Rome; second, Israel; third, an optional extension into Egypt. We’ll be visiting the Colosseum, the Vatican Museums, Saint Peter’s Basilica, the catacombs; then on New Year’s Eve heading to Israel for visits in see SHAFER page 13

Three intriguing business books — to give or to get

Legal Matters Legal Matters Matters Legal Don Shafer

(Editor’s note: Each month Jack Covert, founder of 800-CEO-READ, reviews the best recently released business books. Jack is coauthor of The 100 Best Business Books of All Time, released in March of 2009.

800-CEO-READ is a leading direct supplier of book-related resources to corporations and organizations worldwide, and specializes in identifying trends in the changing business market.)

cessful company and graduated Ivy League, it doesn’t mean they’ll fit your culture or excel in the position you have to offer.

To get the best fit, Anders advises you look for a candidate’s character not through employee or education experience, but through their alternative interests. Perhaps a candidate has a jagged work history, perhaps they don’t have any glaring success stories. Anders says don’t overlook these candidates.

Read resumes from the bottom up, Anders suggests, and look for hints as to “why” the person did what they did, not just the fact that they did it. Oftentimes, he surmises, you’ll discover hidden talents that can be useful to your organization and the tasks you need completed — and potentially avoid candidates who just “look good on paper.”

While some might regard this approach as a gamble, The Rare Find will counsel you on just why this approach is less of a risk, and will help you make better decisions in finding true talent to help your organization grow.

StaffingMatters Matters Legal

that someone was recently murdered in his tent in Pioneer Park deter you from shopping at the Gateway, only a block away? If the NBA labor dispute ever ends, will you think twice about going to Energy Solutions Arena after

Real Estate Matters Legal Matters THE CENTER OF IT ALL

The Rare Find: Spotting Exceptional Talent Before Everyone Else

By George Anders, Portfolio 276 pages, $26.95, Hardcover

There are many situations in which you want to make the right choice, a choice that might change your lives in hugely positive ways.

Consider standing before a roulette wheel in Las Vegas: you choose “18 Red” for a variety of reasons that have all sorts of associative data you apply to it. Red is exciting; No 1 is a symbol of success; the 8 represents the infinity symbol; maybe 18 is the age of your daughter. If you’ve made the right choice based on these influences, the payout will be high.

Now consider hiring someone for a position in your company.

You look at a candidate’s resume and study the provided data: where they’ve recently worked, what they did there, how long they did it, where they went to school, what grades they received. It all looks good, so that candidate gets the job.

While gambling and hiring seem quite dissimilar, the risks in each scenario are similar. And if you’ve made the right choice, the payout could be high in this case, too.

But which approach to decision-making seems more valid?

The associative data or the concrete facts? The facts, right? Well, in The Rare Find, George Anders argues intelligently that these two examples might be equally meaningful in what they reveal. Hiring is just a good guess, and even the “facts” aren’t very illuminative. Even if a candidate spent five years at a suc-

HR Matters Legal Matters

INLAND WESTERN R

Retail Real Estate Trust, Inc.

Blah Blah Blah: What to Do When Words Don’t Work

By Dan Roam, Portfolio 350 pages, $29.95, Hardcover

I’ve been fortunate to spend time with Dan Roam over the years, and his new book, Blah Blah Blah, is as high-energy, insightful and creative as he is.

Blah Blah Blah is a book that may just be impossible to give justice to in a review. From cover to cover, Dan Roam uses his great skill at communicating through words and pictures to inform us, charm us and convince us to accept his belief that ideas become clearer when they are represented by pictures. Not that words aren’t important — this book is full of them — but Roam explains that:

“Words are abstractions, the ultimate mental shorthand. When we know what they mean, words instantly call to mind ideas, images, feelings, and memories. When we all speak the same language, our words offer near-perfect communications efficiency ... But the extraordinary verbal efficiency of words also has a steep downside.

Like all abstractions, words are by

see BOOKS next page

9

The Enterprise

Nov. 21-27, 2011

BOOKS

from previous page definition distinct from the actual “things” they represent. If we are unclear in our own mind about which specific “thing” our word means or if we’re unclear when we share words with other people, the whole system crashes.”

Roam’s solution? Make communication less of an abstraction by using pictures to help guide understanding, to learn more quickly and to share ideas more clearly.

Start with Roam’s method of creating a Visual Grammar: “When we say a word, we should draw a picture.” Easy enough. Then combine that grammar into Vivid Thinking, which is more than just linking word pictures together, but about combining them in a specific way that reflects the complexity of our ideas — because Vivid Thinking is Balanced Thinking. As Roam writes:

“Verbal mind, visual mind.

They see the same world, but they don’t see it the same way.”

This is important: drawing pictures as Roam suggests is not about simplifying. Nor does it dumb down our ideas. Instead, it makes them more concrete, more sticky.

In fact, reading through Blah Blah Blah reminds me of my first reading of Made to Stick by Chip and Dan Heath. Perhaps it’s Roam’s use of the word FOREST as a mnemonic device for his six essentials of vivid ideas. (The Heath brothers used the word SUCCESS as a mnemonic to remember their keys to sticky ideas.) FOREST stands for Form, Only the Essentials, Recognizable, Evolving, Span Differences, Targeted.

The use of FOREST is particularly memorable because of its relations to the phrase, “He couldn’t see the forest for the trees.” For Roam’s book offers easy to remember, easy to implement ideas that will help you see (and communicate) the forest and the trees.

The Power of LEO: The Revolutionary Process for Achieving Extraordinary Results

By Subir Chowdhury, McGrawHill 208 pages, $28.00, Hardcover

Subir Chowdhury has written 13 books over the years, most recently a wonderful little parable entitled The Ice Cream Maker in which he introduced the LEO approach to sustaining quality in everything a company does. Since then, he has received repeated requests to write a more in-depth treatment of that process as it would work, or has worked, in the real world. And so Chowdhury took the LEO approach into the real world, tested it in numerous companies large and small, and has now delivered the book that so many were asking for — The Power of LEO.

LEO stands for Listen, Enrich and Optimize, and it was developed

by Chowdhury and his team after he realized that the Six Sigma and

Un/Tethered

other management tools they were teaching to companies weren’t being fully implemented because they weren’t being tailored to those companies’ specific needs. LEO is designed to remedy that, tailoring those tools to each company’s unique circumstances, goals and culture.

The Listen process requires putting aside past assumptions to comprehend the challenges the organization may be facing — involving customers, suppliers and employees in the process. The Enrich process involves reaching out to all relevant parties for ideas and solutions. And the Optimize process is when the solutions are examined and evaluated, subjecting them to every kind of challenge along the way and correcting possible shortcomings. As you move through these processes, the goal is to go from simply solving the problems your organization faces to avoiding them in the first place.

There are four cornerstones or mindsets to the LEO approach: “Quality Is My Responsibility” in which quality is shifted from a department responsibility to a personal responsibility; “All the People, All the Time” stresses the need for employees on every level of the organization to be a part of the quality campaign; an “I-CanDo-It Mindset” encourages building employee confidence to ready them for the quality transformation, and; “No One Size Fits All” stresses again the need for solutions that are tailored to the company and situation at hand.

The LEO approach is then applied to three phases, the Fire, Flow and Future. The Fire is the specific problem at hand, Flow is the entire operations side of the company, and Future involves new products and services. Chowdhury dedicates a chapter to each of these areas with a case study for each: “Putting Out Fires” at a jelly-bean factory, “Fixing the Flow” at a toy company, and “Commanding the Future” at a major car manufacturer. He then rounds out the book with more stories on “Listening Hard,” “Enriching the Product” and “Don’t Compromise, Optimize.”

Throughout The Power of LEO runs the undercurrent of “The Quality Mindset,” which focuses on people quality, and the author stresses from the beginning that the American leadership in innovation can better benefit our organizations and economy if we focus on quality in everything we do.

Just a generation ago, work and life were treated as different entities.

Thanks to mobile technology and a globally interconnected world, we’ve gone from “Honey, I’m home!” to “I’ll be just a second, I’m checking email.” What does this mash-up of our personal and professional lives mean for workplaces at home and all the other sites where work gets done?

The Home/Office Paradox “Many people have home offices or office-like spaces, yet few actually use them, or use them as expected. The common advice for a home office is that you should be away from everything else happening in the house.

That’s the exact opposite of what people are doing. They are happily adapting their own solutions to better integrate work within the other parts of their lives.

Staying in the Loop We may be out of the office but we’re not out of touch. During many of the hours they spend at home, people connect to the outside world. Everyone brings their devices home. And everyone — clients and bosses especially — values responsiveness.

Working Amid Family Life Some people feel most comfortable working in the kitchen or living room while family life swirls around them.

They stay on top of work yet remain part of the family. For example, a software manager screened incoming emails at a kitchen counter while his wife (who sometimes pops open a laptop at the counter) prepared dinner.

His rationale: “Our daughter’s doing her homework at the kitchen table, so I can be a total screen geek and yet still be vaguely social with my family.”

Roaming People don’t stay put. When they’re out of the office, they miss the energy of having other people around, so they spend part of their days in “third places,” like coffee shops. Achieving a good vibe and aesthetic, without necessarily having to engage with others.

Soft Landings Comfort historically has been antithetical to the head-down work ethic: if you’re too comfortable the fear was you’d lose focus. But at home, comfort is king. “I absolutely cannot work with my feet down. They have to be up.”

Or, “I don’t feel like I’m working here. That’s the most important feeling.”

Toggling Traditional 9-5 routines are disappearing. For many, the day more closely resembles four or five waves that begin earlier and end later, with a back and forth between work and life activities. People switch between these two pursuits without fully abandoning the other. This is toggling, It’s not just multitasking, it’s multitasking combined with multi-locating.

Nesting Some work-at-home people are creating hybrid work/home settings that combine comfort with a pleasing aesthetic, i.e., a nest. A design director camouflaged her workspace at home to look as much like a living room as a place to get things done. The desk is like a side table and also converts to an extension of the dining table, and a large, pillow-stacked lounge chair and couch take prominent positions. They can sit there together and feel a sense of nested communing, while still working.

Boundary Issues Merging work and home life may be inevitable for many people, but it’s not always easy. Being distracted by the very comforts that make working at home desirable in the first place, and the stress of trying to separate work and the rest of life, are typical issues. It’s about setting boundaries. When you’re always able to tap the interconnected business world, the live/work balance too often tilts toward work.

Work and workers, when set free, flow like water along the path of least resistance. Untethered from the office, but not the work. Email follows us everywhere and our work demands are escalating, yet we want a life outside of work. While people occasionally need to cocoon in a secluded space to concentrate on a task, that’s the exception. Most prefer to be nomadic, mixing the always-on stream of work with other activity. Rather than be secluded, people want to stay connected to others for stimulation and, likely, to compensate for the increasingly distributed lives so many of us lead.

For most of us, comfort is key, both psychic and physical. Wherever we work, we want to be relaxed, stimulated, even inspired. Smart companies get it, and they’re building inspiring places to work. The rules are gone.

Conventions are being challenged. The tethers are decidedly coming off.

Midwest Commercial Interiors 987 S. West Temple • SLC, UT 84101 801•359•7681 •mwciutah.com

10

The Enterprise

Sales questions and answers

Jeffrey, How do buyers decide,

I get a ton of e-mails from people seeking insight or asking and what are buyers looking for?

Alana me to solve sales dilemmas. Here Alana, are a few that may relate to your Buyers are looking for five job, your life and, most important, your sales thought process right things: 1. A perceived difference of your product and service – and now:

Jeffrey, that of your competitors. 2. A bet Your seminars and books ter perceived value in buying what have been highly therapeutic to you have versus buying from a me in my budding sales competitor. (Notice I did career, but I have a quesnot say “lower price,” I tion I’m having a hard time said “better value.”) 3. answering on my own. My Little or no risk in purwife is building a Mary chasing from you. The Kay business, loves what buyer must perceive that you do, and is dying to put the gain of ownership your methods to use. Her is greater than the risk business is 80 percent sellof purchasing the wrong ing product and 20 perthing. 4. The buyer Jeffrey cent recruiting. A lot of must like you, believe Gitomer the recruits typically come you, have confidence in from the product buyer’s group. you and trust you. But it begins How does one combine those with liking you. 5. Lowest price. two activities without turning off Many people (maybe even you) the “makeup buying” customers will think I have done them a diswho are not interested in a sales service by not focusing on price career? Does someone like her concessions or winning a bid. But, put up a “beauty tips” social if you present the first four elemedia presence to promote to her ments outlined above, price will “makeup buying customers” and go away as an issue in 60-70 perthen a separate one for recruiting cent of the sales you make. The people to a team? Or do you pep- key is this: Buyers and decision per one in with the other? My con- makers are looking for “comfort,” cern is turning off the “product not just a “deal.” The decisionbuying public” that IS interested maker has to feel that it’s a good in beauty tips but NOT interested fit for their company, or they will in being recruited. I appreciate pass no matter what the price. The your guidance. decision-maker is also going to

Matt take into account past dealings

Matt, and word-of-mouth advertising.

Here’s the wisdom I would All buyers and decision-makers share with your wife: Luckily, the in any given industry know one product you’re selling has been another. Your job, besides having around for years and enjoys a a great product, is to have a great great reputation. I recommend you reputation. Having a great reputainterview some of recruits who tion reduces the perceived risk have embraced the opportunity and oftentimes is the very key to to sell and let some of your more getting the order.

Best regards, successful people post on the web- Jeffrey site about how they started out Jeffrey, loving the product and ended up In these hard times, what reselling the product. If the mes- sage does not come from you, it can salespeople do to protect their will not be a turn-off. The key jobs?

Tom is balance – and your job is to Tom, balance beauty tips with beauty The antidote is to be the best money-making opportunities of at salesman or saleswoman. No one’s least 5:1 in favor of beauty tips. going to get rid of you then. There Best regards, is a challenge among salespeople Jeffrey

right now. They’re not really willing to do the hard work that it takes to make selling easy. You need to tweet, have a business Facebook page, have a LinkedIn account, have a YouTube channel, have a blog, and have a website where you have registered yourname. com. It’s about building a personal brand. You have to have 500 people following you on Twitter, you have to have 500 LinkedIn connections, you have to have about a thousand people on your Facebook fan page and you have to have a least a dozen YouTube videos up where people give testimonies for you, or where you are giving valuable information to the marketplace. That requires work and time, and you can’t do it during your workday. You’ve also got to network and do prospecting, but it’s a lot easier to prospect on LinkedIn then it is to prospect on the phone with people you don’t know. But instead of performing those strategies, a lot of people are going home at night to watch stupid television shows. Think about this: Will what you’re watching on television help you double your sales? No! Great salespeople are willing to dig in and do the hard work because they understand there’s no 9 to 5 job in selling unless you’re at McDonald’s and you can ask the closing question, “Do you want fries with that?”

Best regards,

Jeffrey Jeffrey Gitomer is the author of The Sales Bible, Customer Satisfaction is Worthless Customer Loyalty is Priceless, The Little Red Book of Selling, The Little Red Book of Sales Answers, The Little Black Book of Connections, The Little Gold Book of YES! Attitude, The Little Green Book of Getting Your Way, The Little Platinum Book of Cha-Ching, The Little Teal Book of Trust, The Little Book of Leadership, and Social BOOM! His website, www.gitomer.com, will lead you to more information about training and seminars, or e-mail him personally at salesman@gitomer.com. © 2011 All Rights Reserved

Nov. 21-27, 2011

Small businesses are happy with their bank. Are you?

Despite the angst against pared with 48 percent of those banks that has been seemingly using a large bank. rampant as reported by media, • Small-business owners are there is one segment of the popu- twice as satisfied with their prilation that is satisfied with their mary bank if it is a community banks: small businesses. bank vs. a large bank (39 percent

A J.D. Power and Associates compared to only 15 percent). report released a few

Further, comweeks ago shows that munity banks serve overall satisfaction among Main Street, not Wall small-business banking Street. They didn’t make customers has increased irresponsible loans and, from 2010. The study of as the numbers above 7,000 small businesses show, are major funders shows that customer satof small businesses. isfaction in 2011 averages When business own717 on a 1,000-point scale, ers apply for a loan up from 711 in 2010. The Dale Gunther at a community bank, study, now in its sixth year, they get an answer fast measures small business custom- because decisions are made by a er satisfaction with the overall local committee that knows the banking experience by examin- business and considers more than ing eight factors: product offer- just a credit score.

Community banks offer most ings; account manager; facility; account information; problem res- of the same products and services olution; credit services; fees; and as big banks, but at a lower cost. account activities. Satisfaction in Small businesses can especially 2011 increases across all factors, benefit from this by working with except for fees. their community banker to create

The same study showed that a package of products and sercredit availability has increased, vices that exactly fits their needs indicating greater stability and at a cost that makes sense.

Community banks give back a return to some degree of nor- malcy within the small-business to local communities through volunteerism and monetary donabanking environment.

So while most small-busi- tions. They provide important nesses are happy with their bank, financial education to the underserved. They are accountable to the question is: are you?

If not, chances are you bank their customers and community with a big bank where you are members because these people probably treated like a number. are their friends and neighbors.

There are 26 million small Consider switching to a commu- nity bank. businesses in the country right

A good friend of mine made now and 34 percent of those do the switch 25 years ago when banking with the top five banks. just starting out in the contractor If you’re not satisfied with your business. He shopped his busi- big bank, there are nearly 8,000 ness plan to several big banks in community banks across the the area, all of which turned him country and 21 right here in Utah down. That’s when he came into that would serve your business my office at Bank of American well with personalized service, Fork. Together we worked out lower fees and products to help financing that jump-started his your company succeed. business. That friend is now a To find a community bank successful contractor who has near you, use the Independent built several multi-million-dollar Community Bankers of America’s buildings and continues to thrive community bank locator at www. today. icba.org/locate.

All banks are not made equal and nowhere is that truer Dale Gunther is vice chairman than when comparing community of the board of People’s Utah banks to large, national banks. Bancorp, the holding company for Bank of American Fork, which is Here are just a few facts that dem- an Equal Housing Lender and onstrate the differences: Member FDIC. At the start of his

• Banks with assets under $1 16-year tenure as CEO at Bank billion (most community banks) of American Fork, the bank had represent less than 11 percent of two branches and $80 million in banking assets, yet they provide assets; it now has 13 offices and nearly 40 percent of the loans the more than $880 million in assets.

Dale has served as chairman of banking industry makes to small the Utah Bankers Association and businesses, extending credit that currently serves as an American is crucial to job creation.

Fork City Councilman. This article

• 73 percent of small busi- should not be considered legal or nesses using a small bank got the investment advice. Seek legal and credit they sought in 2010, com- investment advice from your own qualified professional.

11

The Enterprise

Nov. 21-27, 2011

Three days ... and counting

Members of the Joint Select gram and call it a spending cut!

Committee on Deficit Reduction, Conversely, the Democrats also known as the “super com- are willing to consider some steps mittee,” have a rapidly dwindling to slow the future growth rate of number of days to agree to a entitlement and other programs, if minimum of $1.2 trillion in deficit the Republicans are willing to help reduction over the next 10 years. generate more revenue — again Their agreement — or lack thereof NOT referred to as tax increases.

Across the Pond — is due by midnight on Nov.

All of the discussions have 23.

Assuming the “super com- taken place with an eye toward the mittee” agrees to at least the mini- fragility in Europe. I indicated in mum level of deficit reduction, a column 21 months ago (entitled the Congress then has until Dec. “A Shot Across the Bow”) that 23 to accept or reject the pack- worst case fears then beginning age. Should partisan polito impact Greece were tics rule the day and an that excessive sovereign agreement is not reached, (national) debt issues then $1.2 trillion in deficit could spread to other reduction over the followEuropean nations. ing 10 years automatically I suggested that such kicks in during early 2013, issues could also evenwith half in the defense tually spread to the U.K. sector. and to the U.S. We are

The sum of $1.2 Jeff Thredgold simply NOT immune trillion is a lot of money, to the sovereign debt although it is (unfortuissues that have already nately) almost pocket change in engulfed Greece, Ireland, Portugal the nation’s capital. That level of — and now Italy and, increasingdeficit reduction would trim gov- ly, Spain. In recent days, anxiety ernment spending over the next about French sovereign debt and 10 years by less than 3 percent a related financing costs has moved year. closer to the media’s page one.

Given the widespread pain Note: the Germans and the of the Great Recession and the International Monetary Fund DO somewhat pathetic U.S. economic NOT have the financial whererecovery of the past nine quarters, withal to rescue larger and larger have you or anyone else you know euro nations now threatened with been forced to trim your/their sharply higher borrowing costs. annual spending by 3 percent?

In Coming Days

No further comment neces- The next few days are likely sary to become increasingly emotional The Committee and bitter, with both sides attack As you are likely aware, the ing the other side for their intran12-member committee is com- sigence. The stakes are very high. prised of six Democrats and six The Democrats will be Republicans, with six from the required to give a bit more in House of Representatives and six regard to slowing the future growth from the Senate. Each member rate of entitlement programs. The of the committee was presumably Republicans will likely push for picked by their party leadership lower tax rates across the income for their devotion to party prin- board, with some limitations or ciples. eliminations as to current deduc A simple overview would tions. The result would be slightly suggest that Republicans are higher revenue. opposed to anything that smells The best and brightest hopes of tax increases, while Democrats are that a much larger agreement vow to protect current govern- to reduce future budget deficits ment programs, particularly by $3-$4 trillion over the next Social Security, Medicare and 10 years could be reached. As Medicaid. Still, there is a bit of I indicated in last week’s coloptimism that the good of the umn, such a “grand plan” could nation just might supersede the be worth perhaps 300-500 points devotion to Party core values. on the upside for the Dow Jones

Republicans on the com- Industrial Average (DJIA). This mittee, with some support from would be particularly true if the other members of the Congress, agreement was comprised of more have indicated a willingness to substance and less hot air.

Conversely, the failure of consider some forms of “revenue enhancement.” Just don’t call it Democrats and Republicans to a tax increase. Such willingness reach an agreement on what is is conditional on the Democrats really “a less than 3 percent” agreeing to some future reductions reduction annually in government in the growth rate of entitlement deficits over the next 10 years and other programs, erroneously would not be taken kindly by (in my view) referred to as spend- Wall Street. Such failure, with the typical complaining by both sides ing cuts.

As noted previously, only in about how impossible the other Washington, D.C. can you spend side is to work with, could cost the more money every year on a pro- DJIA 300-500 points.

Other Options

Some have suggested that the failure of the “super committee” to reach agreement — or of reaching a deal for the minimum $1.2 trillion of deficit reduction that is full of holes and unrealistic assumptions — could then compel the Congress to look at other deficit reduction options that have been presented during the past year or so.

In my view, the best proposal to date has been that of the President’s own deficit reduction commission, chaired by Erskine Bowles of North Carolina and former Sen. Alan Simpson of Wyoming, which presented its recommendations last Dec. 1. That proposal called for reducing future

budget deficits by roughly $4 trillion, and was viewed by some as a viable down payment on financial sanity in this country.

That comprehensive proposal was hated by the far right AND by the far left. On the other hand, the political “middle” saw merit in many of the proposals. Such is many times the nature of good policy in Washington, D.C.

Unfortunately, the rules of that 18-member commission required 14 members to agree to support it. It received 11 affirmative votes. As a result, the President AND the Congress essentially ignored its recommendations.

Too bad.

One other “proposal” came from Warren Buffet. He noted in

a CNBC interview that he could solve the deficit issue in five minutes. He suggested “you just pass a law that says that anytime there is a deficit of more than 3 percent of GDP (note: versus roughly 9 percent currently), all sitting members of the Congress are ineligible for re-election.”

Food for thought.

Jeff Thredgold is the only economist in the world to have ever earned the CSP (Certified Speaking Professional) international designation, the highest earned designation in professional speaking. He is the author of econAmerica, released by major publisher Wiley & Sons, and serves as economic consultant to Zions Bank.

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12

Nov. 21-27, 2011

The Enterprise

Entrepreneurs, don't forget to consider Section 83B election for restricted stock awards

Utah is an entrepreneurial incentive stock options (ISO), non state. Every week in this paper qualified options (NQO or NSO) there are articles and notices of and restricted stock awards. This the formation and opening of new article addresses basic informabusinesses. These businesses are tion about restricted stock awards high-tech businesses, low-tech granted as incentive compensation businesses, service businesses and to founders and other employees just about any kind of business (recipients) and the consequences of Section 83b of the you can imagine or that Internal Revenue Code you wished you would on such awards. This is have imagined. Most of not a new topic but it is these businesses have a always helpful to consider few things in common: potentially disastrous tax

1. They have limited consequences for a seemcapital; ingly easy compensation

2. The founders transaction. Inasmuch as know with absolute ceran equity interest in the tainty that the business Bud Headman business is a desired, or will be successful; and even required, incentive

3. The founders, owners and employees want to for founders and key employees, share in highly anticipated finan- the consequences of the grant of “restricted stock” in the new busicial rewards of the business.

It is exciting when a new ness should be carefully considbusiness actually succeeds and ered.

Restricted Stock the owners and key employees are financially rewarded for their The term “restricted stock” hard work and financial risk. One is used in a variety of ways method of providing incentives to when dealing with businesses. founders and key employees is the Under the rules and regulations issuance or grant of restricted stock of the Securities and Exchange awards. A company may provide Commission, restricted stock financial incentives to founders refers to unregistered stock and the and key employees in a variety of requirements of Rule 144 adopted ways including, but not limited to, under the Securities Act of 1933, PATRAVI TRAVELTEC

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For compensation purposes, the term “restricted stock” is stock which vests over a period of time. Section 83b of the Internal Revenue Code addresses the taxation of restricted stock awards.

Generally, the vesting requirement of restricted stock is a designated time period (a “vesting period”) during which the recipient must work for the company. If the recipient works for the company for the full vesting period, he has complete ownership of all the shares and the shares are no longer subject to forfeiture. If the recipient does not continue to work for the company during the vesting period, the shares are forfeited back to the company and the recipient has no further interest in, or claim to, the shares.

Restricted stock may be shares that:

• Have been issued for no initial payment by the recipient; or

• Have been issued to the recipient for a price that is less than the fair market value at the time of issuance.

For example, a company’s founders may be issued restricted shares with a two-year vesting period at a price of $0.001 per share and shortly thereafter, the company may raise capital from non-founder investors at $1 per share. In this case, the IRS may deem the fair market value of the founders’ shares to be $1 per share and not the $0.001 per share actually paid by the founders.

Once the vesting requirements are met, the recipient of the restricted shares owns the shares outright and they are no longer subject to forfeiture, although in many privately held companies, shareholders may be required to enter into a shareholders’ agreement that restricts the future transfer of shares. The restrictions in such shareholders’ agreements continue to be applicable even if vesting periods have expired for restricted stock award purposes.

Income Tax Consequences Without an 83b Election

Inasmuch as restricted stock award shares are not vested when issued (and are subject to forfeiture back to the company), there is no income event to the Recipient when the shares are issued and, therefore, no income tax liability attributed to the issuance of the shares at the time of issuance.

This sounds great, right? If the company is successful, there is a possibility that the recipient may have a huge tax liability when the restricted shares become vested.

Consider the following example:

The recipient is given a restricted stock award of 10,000 shares of the company’s stock at

One method of providing incentives to founders and key employees is the issuance or grant of restricted stock awards. a time when the fair market value of the company’s stock is $1 per share. The recipient is not required to pay anything for the shares.

The shares vest at the end of three years.

Because the shares are not vested, the issuance of the shares by the company to the recipient does not result in income to the recipient.

The recipient works for the company during the three-year vesting period.

At the end of three years, the shares are fully vested and the company’s stock is now worth $15 per share.

As soon as the shares are vested, the recipient now has ordinary income in the amount of the full current market value price of the 10,000 shares of stock.

The recipient now has $150,000 of ordinary income that must be reported on his tax return and he must pay federal and state ordinary income tax on this amount.

If the company is privately held, the recipient will likely not be able to liquidate his stock to pay the taxes owed.

As you can see, this is a terrible result for the recipient. Is there any alternative for the poor fellow? Yes, the recipient could have made a Section 83b election for the restricted shares at the time they were issued.

Tax Consequences if an 83b Election is Made

If the recipient makes the Section 83b election on the restricted shares when the restricted stock award is granted by the company, the tax consequences described above do not apply.

Instead the recipient takes into current income the fair market value of the restricted shares at that time they are received by the recipient even though they have not vested.

When the shares become vested, there is no taxable income to the recipient. When the recipient sells the shares after vesting, he reports capital gains or losses based upon

the amount realized on the sale of the shares over the fair market value of the shares reported at the time they were issued. Using the example set forth above:

• The recipient will have ordinary income of $10,000 when the shares were issued and he would be required to pay income tax on such income at an ordinary income tax rate (not capital gains rate);

• The recipient will have no income when the shares vest;

• When the shares are sold for $150,000, the recipient will have capital gains income of $140,000 ($150,000 less the $10,000 reported as income when the shares were issued). The capital gains rate is significantly less than the ordinary income rate and the recipient has cash from the sale of the shares to pay the tax.

Risk of Making an 83b Election

A Section 83b election is not without risk. If the company’s stock does not rise in value after the recipient makes the election, the recipient has accelerated his tax payments without receiving any benefit. If the shares are worth less when sold than they were when received, the recipient would have a capital loss, not an ordinary loss. In the above example, if the shares that were valued at $10,000 when issued are sold for $6,000, the recipient would have a $4,000 capital loss, not an ordinary income loss.

There is also the possibility that the shares may not vest if the recipient forfeits the shares after making the election. If this were to occur, the recipient could deduct any amount he paid for the shares (subject to capital loss limitations), but the recipient gets no deduction relative to the compensation income he reported when the 83b election was made. This is obviously a bad result.

Strategies

Because of the potential risk, a recipient will have some uncertainty as to whether he should make the Section 83b election or not make the election. What will happen to the recipient, the company and the stock value in the future is unknown at the time the election must be made or not made, there can be no assurance the decision to make the election or not make the election will be the right decision.

It is probably a good bet to make the Section 83b election in the following situations:

• The amount of income the recipient will report when the election is made is small and the potential growth in value of the stock is great.

• The recipient anticipates see STOCKS next page

SHAFER from page 8

Nazareth, the Galilee, Jerusalem, Bethlehem and more. Then, after Qumran, the Dead Sea and Masada, most of us will head for Egypt and a five-star Nile River cruise, Luxor, the Valley of the Kings, the Cairo Museum, the Pyramids and Sphinx. I got this thing arranged through dickjensentours.com for a super price, particularly when you consider that airfare alone for all of this — Salt Lake to Rome to Tel Aviv, then Cairo to Aswan, and finally, back to Salt Lake — is going for about $2,500. Our deal is $2,599 for Rome and Israel, and $999 more for the Egypt extension.

And, of course, our trip includes hotels, motor coaches, guides, entrance fees, two or three meals every day and a Nile River cruise.

Not bad, huh? But then, I’ve discussed the advantages of group tours previously.

Anyway, so what do you think the most frequently asked question might be from people who are considering the trip?

Yo u ’ d think they would be asking, “How do you do it?” Or saying, “all that for that price — you’ve got to be kidding.” Or maybe questioning whether we will be staying in youth hostels, or making our own lunches after shopping at nearby grocery stores, or riding on public transportation buses, or floating the Nile on a barge. In which case the answers would be no, no, no and no. In fact

13

The Enterprise

Nov. 21-27, 2011 we’ll be in first-class hotels, where we will also dine, doing our touring in a motor coach with a very knowledgeable English-speaking guide, and sailing down the Nile on a five-star river cruise ship operated by a Swiss luxury-hotel group.

And while a few questions from prospective travelers are weather-related: “How warm will it be?” “Does it rain or snow there?”

And a few questions are about clothing: “Will I need my heavy winter coat?” “Is casual wear OK?” “Do I need to have a raincoat?”

And a few concern money: “Should I exchange dollars here for local currency there?” “Do they have ATMs?” “Do U.S. dollars work with street vendors?” By far, the most frequently asked question, and usually the first question, is motivated by a visceral feeling of fear: “Do you really think it is safe to go there?”

My answer is always met with an incredulous blank stare: “It is far more safe to travel there than it is to commute from your home to work on I-15.” Or something like that.

Don Shafer has been hosting radio travel shows in Salt Lake City for more than a dozen years, and was taught everything he knows by travel experts he has interviewed.

Although some have called him “The Travel Doctor,” he holds a Ph.D. in a totally unrelated field, religion.

STOCKS from previous page

growth in the value of the stock and the likelihood of forfeiture is very small.

It is probably not a good bet to make the Section 83b election:

• If the recipient doesn’t anticipate being employed by the company when the shares vest, in which case forfeiture seems likely.

• The recipient is required to pay a large tax payment at the time of the election with only modest prospects for growth in the value of the stock.

What to Include in 83b Election Filing

The IRS has not provided a specific Section 83b election form for filing. The IRS requires a Section 83b election filing to contain the following information:

• Recipient’s name, address and taxpayer identification number (for individuals, their social security number); description of the shares received;

• Date that shares were received, and the taxable year to which the grant relates;

• Description of the restrictions on the shares;

• Fair market value of the shares at the time the shares were received;

• Amount, if any, that the recipient paid for the stock; and

• A statement that copies of the Section 83b election have been furnished to the issuer of the shares (the company).

The Section 83b election must be made within 30 days after the restricted stock award is made by the company to the recipient.

Conclusion

The workings of Section 83b are not complex but because of the uncertainty of the future success of a company, the possibility of an increase in share value or no increase in share value, or the possibility of forfeiture of shares, a decision to make a Section 83b election can be difficult to make. Founders and key employees should carefully consider the opportunities for tax savings, as well as the risks, associated with a

Section 83b election. They should discuss the risks and merits of a Section 83b election with their lawyers and accountants.

A. O. “Bud” Headman is an attorney with the Salt Lake City law firm of Cohne Rappaport & Segal. His practice focuses on arbitration and mediation, business formation and planning, mergers and acquisitions and securities, registration and reporting.

This article is not intended to constitute legal or tax advice and cannot be used for the purpose of avoiding penalties under the Internal Revenue Code or promoting, marketing or recommending any transaction or matter addressed herein.

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14

Mindless ­— but always talking loud

At a time when nations that answer, Perry flailed embarrasstax, spend, regulate and invest ingly until Paul helpfully sugmore consistently outstrip the gested “EPA?” But for some reaUnited States in many measures son that didn’t satisfy Perry, who of progress, leading Republicans smirked as if someone was trying speak only of smashing govern- to trick him into giving the wrong ment and ending vital programs. response. “The third agency of In this constantly escalating government I would — rhetorical game, it became I would do away with, inevitable that one of them Education, the ...” For would eventually expose painful moments, he the emptiness of this vainkept digging.

“Commerce glorious display. And it and, let’s see,” said Perry was unsurprising that the at last. “I can’t. The ultimate faker would turn third one, I can’t. Sorry. to be Rick Perry.

The dim demagogue Joe Conason Oops.” Later, he idencould scarcely contain tified the Department himself during the CNBC of Energy as the third debate as he turned to Ron Paul, agency he would eliminate. (And his fellow Texan whose sincere as Think Progress blogger Matt hatred of government verges on Yglesias quickly suggested in a anarchism, saying: “I will tell you, tweet, that answer may well mean it is three agencies of government he also has no idea what the DOE when I get there that are gone. actually does, such as providing Commerce, Education and the — subsidies to the nuclear and coal what’s the third one there? Let’s industries and overseeing atomic see.” weapons research and develop With the world watching, he ment.) literally didn’t know what he was “I stepped in it,” he told talking about. And from there it reporters immediately following only got worse. the debate, and observers across

Grinning and groping for an the ideological landscape agreed.

Nov. 21-27, 2011

The Enterprise

But by morning, the Texas governor was offering the same kind of excuse he must have used when he got Ds in school. There are just too many federal agencies, he explained to NBC’s Ann Curry, who might have retorted that there are only 15 Cabinet departments.

What was revealed by Perry’s inability to regurgitate coherently his little blurt about eliminating whole departments of government — aside from proving one more time that he is unfit for campaigning and public office? Perhaps what it shows is how little he actually thinks before delivering these canned rants.

But of course the Texas governor isn’t alone in his ignorance — or his dissembling.

Mitt Romney, whose sole memorable achievement as governor of Massachusetts was the passage of a health plan he now mostly disowns, said that what America needs is a “market-based” medical system, relying on “health savings accounts” to pay for care.

We need that, he said, because as a nation we now spend 18 percent of gross domestic product annually on health care, while our competi-

tors spend 12 percent or less.

Those figures are roughly correct — but to say that such comparisons prove the superiority of the market over the public sector is simply a lie. France, Germany, Switzerland, the United Kingdom, the Scandinavian countries all use different mechanisms to achieve excellent results at reasonable cost, but none of them depend more on the private sector than the United States, and all rely on a combination of public financing, strict regulation and universal mandated coverage to achieve those goals. As Romney surely knows, because while he panders like all the other Republicans, he isn’t stupid.

What is very stupid, as former president Bill Clinton pointedly demonstrates in his new book, Back to Work: Why We Need Smart Government for a Strong Economy, is the constant, mindless denigration of government indulged by the Republicans.

The facts are simple enough even for the average tea party voter to understand: The countries that tax more, spend more

and regulate more than the United States are mostly doing better than we are, whether measured by educational attainment, social and economic mobility, income equality, employment growth or infrastructure quality. They use market incentives and private sector partnerships more intelligently than we do, too — because they know that a strong, competent government fosters enterprise without allowing corporate domination. And despite their current crisis in the eurozone, they will emerge from the recession with those strengths intact.

But then again, European conservative parties would never nominate the likes of Rick Perry, Herman Cain, Michele Bachmann or Ron Paul for public office at any level. No doubt they find the GOP debates bleakly amusing in these dark times. It’s the only attitude that makes watching tolerable.

Joe Conason is the editor in chief of NationalMemo.com.

Copyright 2001 Creators.com.

Nov. 21-27, 2011

Will the Republicans blow it?

Justice Oliver Wendell a job in the first place.

Holmes said that a good catch An expansion of the welfare phrase could stop thinking for 50 state in hard times seems to have years. One of the often-repeated been the secret of FDR’s great catch phrases of our time — “It’s political success in the midst of the economy, stupid!” — has economic disaster. An economic already stopped thinking in some study published in a scholarly quarters for a couple of journal in 2004 concluddecades. ed that the Roosevelt

There is no question administration’s polithat the state of the econcies prolonged the Great omy can affect elections.

Depression by several But there is also no iron years. But few people law that all elections will read economic studies.

This economy be decided by the state of Thomas has been sputtering the economy.

Sowell

President Franklin D. along through most of the Roosevelt was re-elected Obama administration, for an unprecedented third term with the unemployment rate hovafter two terms in which unem- ering around 9 percent. But none ployment was in double digits for of that means that Barack Obama eight consecutive years. is going to lose the 2012 election.

We may lament the number Even polls which show “any of people who are unemployed Republican” with more public supor who are on food stamps today. port than Obama does not mean But those who give the Obama that Obama will lose.

The president is not going administration credit for coming to their rescue when they didn’t to run against “any Republican.” have a job are likely to greatly He is going to run against some outnumber those who blame the specific Republican, and that administration for their not having Republican can expect to be

15

The Enterprise

attacked, denounced and denigrated for months on end before the November 2012 elections — not only by the Democrats, but also by the media that is heavily proDemocrat.

We have already seen how unsubstantiated allegations from women with questionable histories have dropped Herman Cain from front runner to third place in just a couple of weeks.

In short, it takes a candidate to beat a candidate, and everything depends on what kind of candidate that is.

The smart money inside the Beltway says that the Republicans need to pick a moderate candidate who can appeal to independent voters, not just to the conservative voters who turn out to vote in Republican primaries. Those who think this way say that you have to “reach out” to Hispanics, the elderly and other constituencies.

What is remarkable is how seldom the smart money folks look at what has actually been happening in presidential elections.

Ronald Reagan won two landslide elections when he ran as Ronald Reagan. Vice President George H.W. Bush then won when he ran as if he were another Ronald Reagan, with his famous statement, “Read my lips, no new taxes.”

But after Bush 41 was elected and turned “kinder and gentler” — to everyone except the taxpayers — he lost to an unknown governor from a small state.

Other Republican presidential candidates who went the “moderate” route — Bob Dole and John McCain — also came across as neither fish nor fowl, and also went down to defeat.

Now the smart money inside the Beltway is saying that Mitt Romney, who is nothing if not versatile in his positions, is the Republicans’ best hope for replacing Obama.

If conservative Republicans split their votes among a number of conservative candidates in the primaries, that can mean ending up with a presidential candidate in

the Bob Dole-John McCain mold — and risking a Bob Dole-John McCain result in the next election.

The question now is whether the conservative Republican candidates who have enjoyed their successive and short-lived boomlets — Michele Bachmann, Rick Perry and Herman Cain — are prepared to stay in the primary race to the bitter end, or whether their conservative principles will move them to withdraw and throw their support to another conservative candidate.

There has probably never been a time in the history of this country when we more urgently needed to get a president out of the White House, before he ruined the country. But will the conservative Republican candidates let that guide them?

Thomas Sowell is a senior fellow at the Hoover Institution, Stanford University, Stanford, CA 94305.

Copyright 2011 Creators.com

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