September 2019

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September 2019

Inspirational Energy Entrepreneurs Get updated on Oregon’s

Meet Bend Artist Megan Energy Resources and Myers, Successful Immigrant Economic Impacts Laz Ayala, and Commercial Real Estate Developers Mark & Maddy DiRienzo

What Replaces Timber?

Oregon’s Gross Oregon has seen the Changing of the GuardTax where Receipts theWhat high-tech industry has It Means to Oregon essentially offset the decline Businesses of the timber industry.

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Southern Oregon Business Journal September 2019 | 1

SouthernOregonBusiness.com

A few words from Greg Sine die – “With no appointed date for resumption”, The Oregon legislature ended another session with what some believe is more unfinished business than finished. The scheduled short session next February will concentrate on a few money bills that is sure to raise the ire of both the left and right. For now there’s a break in Salem public official activities.

The Sine Die of the Oregon legislature gave Oregonians over 700 new laws to digest.

That’s only slightly below normal for each full session. We’ll be examining the impact our legislative decisions will have on business and economic growth in Oregon. There are compromises that force give and take between the negotiators. Take a deep breath.

September already. That means school, football, and budgets.

We’ve been inundated with updates on every kind of entrepreneurial creativity we can imagine in our southern end of the state.

Home construction has been robust for many months and looks to be continuing well into next year. Economists keep saying a recession is coming but its hard to predict. It may be industry specific depending on the importance of transportation, foreign trade and energy sector activities. Continuing low unemployment, low interest rates and low inflation have us confused about the power of the federal reserve to control all of these at one time. Surely, something has to give. I’d like to be confident in predictions rather than having to simply “wait and see.” Cautious optimism is better than out-of-control expansion or gloom and doom. For now, I’m looking forward to a pleasant end to 2019 and a cheerful holiday season beginning with football and lasting into the new year, still four months away.

Greg Greg@SouthernOregonBusiness.com

The Southern Oregon Business Journal extends sincere thanks to the following companies for their continued presence as important cogs in the wheels of industry in southern Oregon.

A Few Words from Jim I meet with amazing people everyday.

People that inspire me.

People that are fearless.

People that are crazy.

These people are entrepreneurs and I’m excited to start sharing some of their stories with you.

This month you will meet Megan Myers, an artist that has built a sustainable business in Bend.

You will also meet my friends Mark & Maddy who own and operate business parks and storage units.

And finally you will meet my good friend Laz Ayala and learn not only about his successful housing development company that has been focusing on sustainable housing but also sharing his personal immigration story.

This is the third issue since I became partners with Greg and we just keep getting better and better.

Let me know what you think about focusing on the people that start and run businesses in southern Oregon.

Share your story with me and don’t forget the easiest way to support our work is to subscribe for free email updates from our website.

Thanks for your support.

Jim jim@projecta.com

2 | Southern Oregon Business Journal September 2019

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September 2019 - Table of Contents

Inside This Issue 4 - Strong Towns - Refuge and Prospect: The Front Porch 8 - Marketing - Core Values Define Your Brand 10 - Everything you think you know about gentrification is wrong 13 - Marketing without measurement in a world of malignant complexity 14 - Jackson County Employment 15 - SOREDI - Naumes 17 - Flying Lessons: How stories from Aviation can make us better Managers – Final installment 20 - The Oregon Connections Telecommunications Conference is coming to Ashland, Oregon. Oct. 24-25 32 - When did you last "retro" your retrospective?

34 - Oregon’s Nonprofits in 2018 40 - Technology Association of Oregon

Cover Photo

FEATURED

Inspirational Entrepreneurs Meet Bend Artist Megan Myers Page 22 Meet Laz Ayala & KDA Homes Page 28 Meet Mark and Maddy DiRienzo Self Storage and Commercial Real Estate Developers & Operators and Good People.

Page 30 Oregon’s Gross Receipts Tax What It Means to Oregon Businesses

By Greg Henderson Page 42

Girl Hare Smith Rock By Megan Myers meganmariemyers.com See article on Megan’s Art Business on page 22

Southern Oregon Business Journal September 2019 | 3

STRONG TOWNS BETH ANN FENNELLY

Yesterday and today, we are celebrating the past, present and future of the surprisingly powerful front porch.

My approaching birthday has me taking stock, as approaching birthdays do. This year isn’t a milestone — I’m merely being ushered into my (write it!) late 40s.

But I’m passing another sort of milestone. I moved to the South when I was 23. This birthday means that I’ve been a Southerner over half my life.

Adopting a home past the age of reason means that the home’s traditions are not automatic, imbibed with the mother’s milk.

Instead, any adoption is weighty, self-conscious, for it implies a signing-off. Such was the case for

Refuge and Prospect: The Front Porch

me with “y’all.” I’d always loved the word — it’s melodious, it’s gender-neutral (as opposed to my native Chicago’s “you guys,” or, worse, “youse guys”), and it fills a pronoun hole in the English language. Nevertheless, I shied away — I didn’t want to be accused of playacting, appropriating. Yet over the years, when the pronoun slipped out, no one seemed to think it odd.

Finally, when my own toddler began to drawl “y’all,” I stopped fighting it.

Nowadays, having birthed three wild Mississippi children, I not only embrace “y’all,” I occasionally bust out with the seemingly redundant — but actually usefully emphatic — “all y’all.” As in, “All

4 | Southern Oregon Business Journal September 2019

y’all better stop fightin’ or I’m fixin’ to cancel your birth certificates.” No, I don’t really say that. They don’t have birth certificates.

While I slowly adopted some Southernisms, others were easy rejects. (I’m just going to say it: Boiled peanuts are nasty.) And some traditions were not adopted but adapted. For example, friends know to expect my husband’s birthday cake of pink velvet.

During my engagement to my beloved Alabamian, I got the red velvet recipe from his mother, which I tried to follow, really I did.

But when I got to “empty the bottle of red food coloring into the batter,” my hand stalled. All that FD&C Red Dye No. 40: I just

couldn’t release more than a few drops. Hence, the pink velvet cake was born. Which has become its own kind of tradition.

But there’s one tradition for which I felt no hesitation, no need to alter in any way. The front porch.

And Southerners sitting on it. How could this be improved upon? It’s already perfect.

Although Jeff Foxworthy warns that “you may be a redneck if your porch collapses and kills more than five dogs,” originally the porch wasn’t Southern so much as it was American, hearkening back to colonial roots. In fact, in the mid-1800s, landscape gardener Andrew Jackson Downing suggested the porch was the essence of what made a home American, as opposed to British.

“A house without a front porch,” he proclaimed, “is as insignificant as a book without a title page.”

For the next century, Americans never omitted the title page, using porches for napping and storytelling and card playing, lightning-bug spotting and watermelon-seed spitting, guitar strumming over the bass line of crickets and the jingle of ice cream trucks, launching pads for kids with towels tied as capes.

And all the while, porches served as the original neighborhood watch.

This changed after World War II, when new suburbs reflected the zeitgeist of insularity. Culs-de-sac — literally, “bottom of the bag,” in French — hooded the new houses.

Suburbia, which sprang up more quickly in the urbanizing North, was defined by air conditioning and TVs — so who needed to catch

a breeze on a sleeping porch with a roof painted “haint blue”? Like a belt buckle swung around to the tailbone, the porch swung around to become a patio, and, rather like a belt buckle at the tailbone, lost much of its function. Sure, patios provided relaxation, but no longer provided engagement.

Meanwhile, the South, more rural and slower to absorb trends, stayed wrapped around the idyll of wraparound porches.

Therefore, Southerners kept noticing when a neighboring family suffered an illness or death and therefore needed the succor of a broccoli casserole whiskered with French-fried onions.

And Southerners were onto something with their porches. No other architectural space is so deliciously not/and: not inside, not outside. Not public, not private. Not house, not garden. A porous place, whispers half-heard through a window screen. A transitional space, and, as Emerson said, “Power lies in transitions.” Liminal, a threshold, where boundaries beckon — and what a high percentage of first kisses have occurred on porches! And how many multigenerational family portraits?

Here in Oxford, Mississippi, where I live, porches are central to our famously fun Halloween. All down Lamar and South 11th, residents perch on porches, exclaiming over children’s costumes. It’s homecoming, family reunion, and parade, a multi-generational, antiageist trick-or-treat: While kids know who hands out full-sized Hershey bars, their parents know who pours a chilled chardonnay in

your red solo go-cup — looking at you, Leighton McCool — and who refreshes your old fashioned — keep on muddling, John. T. and Blair. Blair once threw a porch party for my birthday. I didn’t think about it at the time, but what a serendipitous locale to toast the changing of the decades, on the margin where things begin and end. The god of beginnings and endings, Janus, would be the proper god for all porches, twoheaded Janus, with one head peering into the future, the other peering into the past.

Our brethren to the North — bless their hearts — caught on, eventually. Some crucial ingredient was felt lacking in suburban life, something that kept the soufflé of the American dream from rising. There’s a fine line, it turns out, between privacy and isolation, and the patio crossed it.

Thus came the 1980s and the example of Seaside, Florida, designed to foster community.

One of Seaside’s crucial mandates: Houses should have porches. New Urbanism spread from there, and the number of new U.S. homes built with porches has risen ever since, from 42 percent in 1994 to 52 percent in 2004 to 65 percent in 2016, according to the National Association of Home Builders.

Once again, our platonic ideal of Home includes a third space to engage, so we know who has LOTS of beer cans in their recycling, and who leaves their Christmas lights up until Valentine’s, and who lets their dog poop in your yard without bagging it (eh-hem, Susan).

Southern Oregon Business Journal September 2019 | 5

Strong Towns (Continued)

But I tend to think, even without Seaside, porches would have staged a comeback, because they serve a deep psychological need.

Douglas Kelbaugh, dean of architecture at the University of Michigan, explains that as we evolved as a species, we craved the combination of refuge and prospect, a single spot that offers both. Early humans sought that kind of habitation, living in a cave above a river, say, or on the edge of a forest with the view of a savanna. The safe haven invites relaxation, with our back protected. The view provides notice of game to hunt or warning of danger. Because this advantageous location played a role in our evolution, it’s programmed into our psyches.

Nowadays, porches offer refuge; close at hand, we have our beloveds and our beer cooler.

And porches offer prospect; warning of game to hunt ... or maybe just the UPS truck.

Dangerous animals ... or Jehovah’s Witnesses.

“Who Doesn’t Love A Good Front Porch?” asks CityLab.com, finding the word “porch” trending in the names of bars, restaurants, and churches; I recently came across a literary magazine called The Front Porch Journal. And doesn’t the very thought of porch reading induce such a thrum of pleasure that it deserves its own appreciation? The region with the highest number of porches, 86 percent, is the South, according to the National Association of Home Builders. And the region with the highest number of kick-ass books, 86 percent, is the South,

according to the National Library of Beth Ann Fennelly. So it’s fitting that great Southern porches are great places to read great Southern books featuring porches. My colleague at the University of Mississippi, Kiese Laymon, dedicated his amazing memoir Heavy to “the porch that Grandmama built.” Readers come to understand that Laymon began writing Heavy in a journal at age 12, on his Grandmama’s porch, and for the next 30 years continued to refine and reflect on these central ideas. We learn as well that his grandmother gave him his foundation of love, and his love of Southern vernacular, while providing him the confidence to launch himself. Refuge and prospect, indeed.

A great Southern porch is great because it’s welcoming and inclusive. All classes, all races of Southerners enjoy a good porch.

It’s not hard to summon Scarlett O’Hara’s grand, columned porch at Tara; neither is it hard to summon Andy Griffith’s battered rocking chair in Mayberry. We have no less than 43 scenes set on porches in To Kill A Mockingbird. The porches are less grand but no less numerous in Jeannette Walls’ The Glass Castle, a memoir of her impoverished Appalachian childhood, where “the porches were every bit as furnished as the insides of most houses, with rust-stained refrigerators, folding card tables, hook rugs, couches or car seats for serious porch-sitting, and maybe a battered armoire with a hole cut in the side so the cat

6 | Southern Oregon Business Journal September 2019

would have a cozy place to sleep.”

Here’s my favorite Southern porch scene, courtesy of Zora Neale Hurston’s Their Eyes Were Watching God. Hurston describes the tired bean pickers of the Everglades, home from their labor: “The sun was gone but he had left his footprints in the sky. It was the time for sitting on porches beside the road. It was a time to hear things and talk. These sitters had been tongueless, earless, eyeless conveniences all day long. Mules and other brutes had occupied their skins. But now the sun and the boss man were gone, so the skins felt powerful and human. They became lords of sounds and lesser things. They passed nations through their mouths. They sat in judgment.”

I’ve been a Southerner almost exactly half my life, and this halflife comes with a responsibility to pass on the best Southern traditions to my children. The front porch, refuge and prospect, symbol of welcome, rooted in history but gazing toward the future, tops my list. The porch has room for every one of us, even the rehabilitated Yankees. Pull up a chair. Y’all are welcome. And that goes for all y’all.

by Beth Ann Fennelly, the Poet Laureate of Mississippi. Fennelly is the author of six books, including three books of poetry, two essay collections, and a novel (co-authored with her husband, Tom Franklin). She teaches in the MFA Program at the University of Mississippi, where she was named Outstanding Teacher of the Year. You can learn more about Fennelly on her website. This piece originally appeared on The Bitter Southerner. https:// bittersoutherner.com/

https://www.strongtowns.org/journal/2019/8/21/ refuge-and-prospect-the-front-porch

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Southern Oregon Business Journal September 2019 | 7

MARKETING VONNIE MIKKELSEN

Inspire, drive, and define your brand While a clearly articulated Strategic Plan aligned with our organization’s Mission and Vision are key to stewarding the resources of our members and delivering on expectations of our community partners, our Values are our true north reminder of who we are, our collective and individual expectations.

Culture is built on stated and lived values that are endorsed and encouraged by leadership, embraced and lived by management, employees, and volunteers. They present the highest aspirational tier of achievement in personal and

Core Values Define Your Brand

professional spheres of our life, far beyond any skill, experience, or particular learned competency.

They serve as guideposts for how we measure a win or mull over a miss; how we tend to an uncomfortable conversation and approach a challenging problem; how we go about our business and our interactions; how we evaluate our performance, beyond the data-driven measure.

Prominently listed on the whiteboard in the interview room were our Core Values: Model Excellence, Embody Innovation, Practice Stewardship, Demonstrate Integrity, and Deliver a Welcoming Experience.

This was intended to gauge thoughtful response from the candidate, and encourage discussion around how they might feel about working here.

I firmly believe that organizations can achieve exceptional results only by creating an authentic organizational Culture through strengthening lived Values.

Would they notice, perhaps inquire about them? Would they resonate in a meaningful way?

Could they articulate how any one of them mattered, and connect it back to their personal or professional goals? Would it be confusing, or would they not inspire any particular thoughts at

We recently went through a recruitment process to fill a couple of positions on staff.

Southern Oregon Business Journal September 2019 | 8

all? Whichever the response, it would matter; for if our core values weren’t to resonate, how could we expect them to bring value and effectively contribute to broader organizational goals.

Interestingly, this exercise led to both enlightening and engaging conversations. I saw candidates relax, open up, offer candid responses, and show enthusiasm for an organization that held employees and management accountable to these values. While not the first time to apply organizational culture fit to the hiring of a candidate, it was the first time I had used stated values as an interview exercise. It turns out a commitment to organizational values is in fact a highly effective talent recruitment tool. The behavior Values inspire and the

culture they drive are highly relevant to the promise of our brand and our overall performance.

At the end of the day, without an

eight full time staff, and a small leased office space. For those operating on a similar scale I can confidently lend this little bit of advice – to know, cultivate and deliver Values as part of your brand does not have to be a big investment of time or dollars. It does require thoughtful deliberation, and purposeful follow through.

And it’s worth it. The ROI is in highly qualified talent committed to your brand’s promise, high customer satisfaction through delivery of your brand promise, and yet untapped dimensional layers of added brand value.

At the end of the day, without an authentic set of values, the integrity of your brand, your culture, sits on shaky ground. authentic set of values, the integrity of your brand, your culture, sits on shaky ground. I know it can be a challenge for small non-profits, business owners and managers to dive deeper into brand identity, brand values, brand promise, and so on.

We too are a small not-for-profit, private corporation operating at less than $750K budget, with

Vonnie Mikkelsen Springfield Area Chamber of Commerce President & CEO

Southern Oregon Business Journal September 2019 | 9

CITYLAB JOE CORTRIGHT

Facts are stubborn things: And they don’t support the folk wisdom equating gentrification with displacement.

There’s a palpable and growing amount of cognitive dissonance between the accepted conventional wisdom about the intrinsically evil nature of gentrification, and a body of careful detailed research that shows that its either not bad, or actually produces measurable benefits. That cognitive dissonance is on full display in CityLab’s recent reporting on a new study of gentrification in New York.

It’s almost taken as a given by many that gentrification is

Everything you think you know about gentrification is wrong

synonymous with displacement.

But a new study from New York University (and one from last week from the Philadelphia Federal Reserve) provide the best evidence yet that there’s essentially no difference in outmigration rates between gentrifying and non-gentrifying neighborhoods. In his article, “Gentrification Did Not Displace NYC’s Most Vulnerable Children“, Kriston Capps bluntly and accurately summarizes the results of Ingrid Gould Ellen’s study of kids born to Medicaid families in New York City: Using Medicaid data, researchers found that most low-income children in the city’s gentrifying

neighborhoods stayed, even as affluent newcomers moved in.

Low-income children born into neighborhoods in New York City that later gentrified were no more likely to be pushed out over a seven-year period than children born into low-income places that did not gentrify, according to a new study that follows exactly where these vulnerable families lived and moved.

The study’s findings turn the conventional wisdom about the link between gentrification and displacement on its head. Lowincome children who remained in their gentrifying neighborhoods saw a 3 percent greater decline in neighborhood poverty than those

Southern Oregon Business Journal September 2019 | 10

in low-income neighborhoods that didn’t gentrify.

CityLab calls these conclusions “surprising” and “counterintuitive”, but these studies confirm a wealth of other research, going back more than a decade that reach essentially the same conclusion. Gentrification is rare and seldom seems to produce displacement of long term residents. We’ve covered these studies at City Observatory, here, here, here, here, and here.

Still, Capps felt a strong need to cushion the blow for his readers: If you are, like many CityLab readers, a mortal foe of gentrification, the study doesn’t necessarily mean that your world is now upside down. The picture that the study paints is complicated.

Implicitly, there’s a new line of argument about the hardships faced by poor households: Gentrification may not force people to move, but these studies show that low income renters move a lot, and moving is per se bad. Capps concedes that gentrification isn’t causing displacement, but that the high levels of movement of low income households is the problem:

Surely, this is complicated. But

Instead, displacement is a nearconstant in the lives of vulnerable families—a force that isn’t correlated with gentrification. Understanding how displacement works is crucial in providing housing to low-income families who seriously lack residential stability, which is key to everything.

Using Medicaid data, researchers found that most low-income children in the city’s gentrifying neighborhoods stayed, even as affluent newcomers moved in.

Translation: “Don’t worry, you can still cling to your knee jerk antipathy to gentrification.” Capps assures disbelievers that they can discount this study, because, “it’s complicated.” That’s a pretty straightforward dodge: it may be complicated, but there’s now a very large body of evidence that you can’t blame gentrification for displacement, which is the most common argument as to its harm.

And one theoretical complication he flags, that gentrification may impose higher burdens of people of color, well, actually isn’t borne out by the data in the NYU study, as Capps acknowledges: The NYU researchers concede that using averages for a sample

of thousands of children could conceal specific harms: : After all, housing discrimination makes it much harder for black and Latinx households to find safe and affordable housing. When the researchers ran the model for children of different races, though, they found few differences. There was no evidence of elevated mobility (greater displacement) for children of any race.

the weight of evidence is now pretty clear that gentrification is not, on balance a bad thing, and in fact, may produce substantial benefits: the Philadelphia Fed study confirms that gentrification produces benefits for long-term residents who remain in the neighborhood. So actually, if you are a mortal foe of gentrification, especially who equates gentrification with displacement, it’s time, as Brad DeLong would say, to mark your beliefs to market.

A shifting rationalization: Conflating moving and displacement

This line of argument conflates “mobility” with “displacement”. For example: There was no evidence of elevated mobility (greater displacement) for children of any race.

Rates of mobility (or displacement) for families living in subsidized housing (31 percent) or public housing (36 percent) were far lower than children in marketplace housing.

Undoubtedly, transitory and uncertain tenure is a huge burden for poor families, as Matthew Desmond’s Evicted, clearly demonstrates. But it’s a stretch to equate every household move with displacement. Movement or

Southern Oregon Business Journal September 2019 | 11

CityLab (Continued)

migration may be an indicator of displacement, but isn’t the same thing. Careful studies of migration have shown that low income renters move for lots of reasons: changes in family status (marriage, divorce or separation), change of jobs, etc.). Most of these moves are self-reported as voluntary in surveys. Martin and Beck found that about onequarter of moves by low income renters were “involuntary.”

More importantly, moving is often either an indicator of success or a path to opportunity. Low income people move out of neighborhoods when their economic conditions improve (to be able to afford a safer place, better schools, nicer amenities) or simply to get better access to jobs. The evidence from the latest analyses of the Moving to Opportunity program and Eric Chyn’s analysis of family relocations in Chicago shows that moving to a better neighborhood is one of the most important routes out of poverty for kids in low income households. In one of the most detailed and nuanced studies of residential mobility of low income households with children, scholars at the Urban Institute tracked household moves in low income neighborhoods in ten cities over a period of years. Claudia Coulton, Brett Theodos and Margery Turner found that moving was an essential path out of poverty for many households.

A move, however, does not always signal problems. For a substantial minority of families, residential mobility represents a positive choice. Across the Making Connections neighborhoods, 3 of every 10 movers were up-and-out movers, often becoming homeowners in better neighborhoods where

There was no evidence of elevated mobility (greater displacement) for children of any race. they were more satisfied and optimistic.

And conversely, some households perceive residential “stability” as a bad thing: they feel stuck in neighborhoods with limited opportunities and amenities. In Coulton, Theodos & Turner’s study, a fifth of long term residents in low income neighborhoods were classified as “dissatisfied stayers.”

In just the same way that we shouldn’t leap to the conclusion that gentrification causes displacement (or inevitably harms long time neighborhood residents), we shouldn’t assume that every move by a low income household out of a low income neighborhood is either involuntary, or results in hardship and that neighborhood stability is a sign of success. It’s more complicated than that. Ultimately,

if we’re concerned about involuntary displacement, our focus ought to be on poverty. As Matthew Desmond writes: . . . if we want to understand why so many families are forcibly displaced from their homes, “poverty” rather than “gentrification” is a better concept to apply.

For too long, the debate about gentrification has hinged on grossly oversimplified narratives, that assume that neighborhoods never change, and that any movement in or out of a neighborhood is negative. It’s a very good thing that we’re finally applying evidence to understand the causes and effects of neighborhood change. To its credit, CityLab accurately reports that the New York University study (like earlier ones) show little or no relationship between gentrification and displacement.

Hopefully this increasingly factbased narrative will lead us to productive policy discussions about how to harness new investment in low income neighborhoods to assure diversity, and will also alert us to the far larger challenge of addressing concentrated poverty.

Joe Cortright is President and principal economist of Impresa, a consulting firm specializing in regional economic analysis, innovation and industry clusters.

Over the past two decades he has specialized in urban economies developing the City Vitals framework with CEOs for Cities, and developing the city dividends concept.

Southern Oregon Business Journal September 2019 | 12

MARKETING MARK SCHAEFER

The economists are confused!

While reporting on the robust economy in America, The New York Times noted that the current combination of low unemployment and low inflation seems impossible.

Economists believed you could never have a low unemployment rate (3.7 percent) without also seeing the rate of job creation slowing (where are new workers going to come from?) and having an increase in inflation.

And yet the economic "impossibility" has happened. The U.S. jobless rate has receded to its lowest level in 50 years, job creation is steady, and inflation is about 1.5 percent, the same as last year.

Stick with me here ...

Here's where it gets interesting (really). Two years ago, the Federal Reserve published a report predicting that the unemployment rate in this year would be around 5 percent, and that this would coincide with a 2 percent inflation rate.

So in this short period of time, the greatest economists on the planet have been embarrassed. All those algorithms. All those advanced degrees. The economists can't explain what is happening in the U.S. economy right now.

I am not making a political statement. I'm making this point to demonstrate that the world has become so complex that even in a math-driven field like economics, nobody really knows what the hell is going on in the world.

Malignant Complexity A few years ago, I predicted that the biggest emerging business trend would be malignant complexity, meaning that the insane complications and unintended

Marketing without measurement in a world of malignant complexity

consequences of rapid technological change makes it difficult to understand our world, let alone predict what's next.

Economics is a mature field, largely based on irrefutable math. And yet, economists cannot adequately explain what's going on in America right now. The rulebook for forecasting and planning is being rewritten. Or, perhaps there is no rulebook at all!

I think we have also hit that point of malignant complexity in marketing where many predictions are wild guesses and measurement becomes intangible.

I recently wrote, with humility, that I do not see a clear path forward for the future of social media. I have a solid track record of discerning how trends come together but there are so many mega-trends in motion right now that I don't understand the interconnections and how it will play out Nobody does.

What happens when we don't understand When I started in business, the company I worked for had us create five-year plans.

That seems silly today, but in the 1980s we could forecast a reasonable long-term plan because the rate of technological change was relatively slow.

An implication of malignant complexity is that the time horizon for accurate forecasts is getting shorter and shorter. Can we even see what will happen in one year? Six months? Will the forecast horizon soon become a month ... or one week?

This is unfamiliar territory for businesses built on plans.

What would happen if we created an annual forecast for our boss that was blank because that is the most honest prediction we could make? That would not be popular. But I

think we're kidding ourselves if we think our mortal minds can stay ahead of malignant complexity!

Marketing without measures?

This reinforces one of the themes I wrote about in my book Marketing Rebellion. We are working in a marketing world increasingly difficult to predict or measure.

Even today, our marketing dashboards are focused on likes and tweets that probably don't matter any more.

Without question, the most successful and relevant marketers in the future will have to relax expectations on predictable outcomes and reliable measures.

I never thought I would write a statement like that because it seems so flaky ... but it's the truth. I'm not making excuses, I'm simply acknowledging that we can either keep up with the pace of this world or we can stick to our marketing dashboards. We probably can't do both.

In an age of malignant complexity and unrelenting change, some aspects of marketing measurement will become a leap of faith. In some cases, the speed of business will outstrip our ability to forecast and measure. Perhaps non-measured, speed-driven marketing management will become the norm, a best practice.

That is going to take some courage, isn't it?

How are you adjusting to this weird new mindset?

Mark Schaefer is the executive director of Schaefer Marketing Solutions, and the author of several best-selling digital marketing books. He is an acclaimed keynote speaker, college educator, and business consultant. The Marketing Companion podcast is among the top business podcasts in the world.

Southern Oregon Business Journal September 2019 | 13

EMPLOYMENT

Jackson

GUY TAUER, REGIONAL ECONOMIST

Seasonal Losses in Local Government Education Reduce Total Employment

Employment Department News Release

Total payroll employment fell by 1,930 jobs in July, mostly due to a typical seasonal loss of 2,040 jobs in local government education.

Employment changes in most other published industries were modest.

Professional and business services added 80 jobs in July. The goods-producing industries construction and manufacturing gained 70 and 40 jobs, respectively. A couple other industries had estimated job losses over the month, including private education and health services (-60); retail trade (-50); and information (-30).

Government employment fell by 2,030 jobs, mostly as a result of the aforementioned seasonal decline in education employment.

Page 3 of 4

August 20, 2019

Workforce & Economic Research Division QualityInfo.org August 20, 2019

Medford-Ashland MSA (Jackson County) Current Labor Force and Industry Employment --Change From-July 2019

June 2019

July 2018

June 2019

July 2018

105,991 5,565 5.3% 4.7% 100,426

105,721 4,824 4.6% 4.7% 100,897

104,249 5,198 5.0% 4.7% 99,051

270 741 0.7 0.0 -471

1,742 367 0.3 0.0 1,375

88,540

90,470

87,490

-1,930

1,050

78,440 5,610 520 5,090 8,230 19,210 2,570 13,300 3,340 1,260 4,060 7,660 17,190 16,360 12,320 10,350 2,900 10,100 1,870 1,040 0 7,190 4,150

78,340 5,540 520 5,020 8,190 19,240 2,550 13,350 3,340 1,290 4,040 7,580 17,250 16,380 12,340 10,360 2,870 12,130 1,870 1,050 0 9,210 6,190

77,510 5,440 520 4,920 7,920 19,560 2,590 13,730 3,240 1,210 4,120 7,830 16,720 16,050 11,950 10,180 2,760 9,980 1,830 1,000 0 7,150 4,220

100 70 0 70 40 -30 20 -50 0 -30 20 80 -60 -20 -20 -10 30 -2,030 0 -10 0 -2,020 -2,040

930 170 0 170 310 -350 -20 -430 100 50 -60 -170 470 310 370 170 140 120 40 40 0 40 -70

Labor Force Status Civilian labor force Unemployed Unemployment rate Unemployment rate (seasonally adjusted) Employed Nonfarm Payroll Employment Total nonfarm employment Total private Mining, logging, and construction Mining and logging Construction Manufacturing Trade, transportation, and utilities Wholesale trade Retail trade Transportation, warehousing, and utilities Information Financial activities Professional and business services Education and health services Health care and social assistance Leisure and hospitality Accommodation and food services Other services Government Federal government State government State education Local government Local education

Over the past year, the Medford MSA (Jackson The most recent month is preliminary, the prior month is revised. Prepared in cooperation with the U.S. Department of Labor, Bureau of Labor Statistics.

County) gained 1,050 payroll jobs, a growth rate of 1.2 Civilian labor force includes employed and unemployed individuals 16 years and older by place of residence.

Employed includes payroll employment, self-employed, unpaid family workers, domestics, agriculture, and labor disputants. percent and slower than Unemployment rate is calculated by dividing unemployed by civilian labor force.

Oregon’s 2.1 percent overall Nonfarm Payroll Employment: Offical Oregon Series. Data are by place of work and cover full- and part-time employees who worked or received pay for the pay period that includes the 12th of the month. The data exclude the self-employed, volunteers, unpaid family workers, increase. Industries adding and domestics. notable jobs over the year were education and health services (+470); leisure and Retail trade (-430) and professional and Since July 2018, government employment hospitality (+370); manufacturing (+310); business services (-170) were the privaterose by 120 jobs. Local, state, and federal construction (+170); other services SUPPORT BUSINESS • PROMOTE EMPLOYMENT sector industries with notable over-the-year government each gained 40 jobs in the (+140); and information (+50). job losses in Jackson County, according to past 12 months. preliminary employment estimates.

Southern Oregon Business Journal September 2019 | 14

Photo by David Gibb | dgibbphoto.com

Rooted in Southern Oregon

With 73 years in business, Naumes has been a family-owned agricultural company for three generations. Founded in 1946 by Joe Naumes, Naumes started with a packing facility and 150 acres of pears in Southern Oregon. Over time, Naumes has grown to include orchards in Oregon, Washington, and California. Today, the primary business continues to be pears, but Naumes has diversified operations to include grape growing, crushing, and winemaking.

Mike and Laura Naumes, Owners Naumes Family Vineyards www.naumesfamilyvineyards.com 1950 Suncrest Rd Talent, OR 97540 541-608-1755

“With nearly 75 years of agricultural Mike and Laura Naumes are the current owners of Naumes, and their three adult children heritage in manage various aspects of the business. Depending on the season, Naumes employs Southern Oregon, between 300 to 1200 individuals, and is constantly looking for more employees. Work at our roots run deep.

Naumes can be hard, and bilingual skills are helpful.

From pears to apples to Supporting the business community in Southern Oregon is important to Naumes. grapes, we look forward Their grape crushing plant not only processes their grapes, but those of other local to our continued presence in farmers. Additionally, Naumes purchases materials locally whenever possible. the region and the opportunities we have to not only nurture our While pear production continues to be the primary business, their future farm land, but continually nurture the in winemaking is very exciting. Their first label was introduced in early region’s growing economy.�

2018 and the Naumes Family Vineyards Wine Club was launched online. In July of 2019, they celebrated to opening of the Naumes Suncrest Winery, which includes a tasting room.

-Mike and Laura Naumes, Owners

www.SOREDI.org/edge

by SOREDI | Southern Oregon Regional Economic Development, Inc.

(541) 773-8946 Southern Oregon Business Journal September 2019 | 15

Rooted in Southern Oregon You may not have given much thought to the pears on your kitchen counter, but the Naumes family certainly has. For three generations, the Naumes family has carefully selected the best orchards in Washington, Oregon, and California and crafted state-of-art packing and storage facilities to bring you the perfect pear.

Today, Naumes has operations that include approximately 5,300 acres in three states and are expanding beyond just pears.

It all started in 1946 when Joe Naumes partnered with Steve Nye and built a packing facility to process Nye’s existing 150-acre orchard. This tenacious duo made it through ups and downs, including having to replace all of their equipment following a fire in year one, and continued on to acquire additional orchards. In the 1960’s, the Naumes family purchased the company from the Nye family, and expanded their efforts on growth.

They purchased additional orchards in California and Washington to expand the amount of days pears are in season. By adding packing and storage facilities, the pears could quickly move from tree to box, and be stored at the right temperature while waiting for distribution.

Naumes Family Vineyards 2015 Pinot Noir

Over the years, Naumes has diversified its business for continued strength. In the 1990’s, Naumes opened the first of three juice concentrate plants that were later closed or sold off. In addition to pears, Naumes has also grown other fruits, including apples and cherries. Most recently, they have cut back on fruit orchard operations and sold off some land, while seeking a new business opportunity for other land.

It turns out that grapes grow very well in vacant orchards, so Naumes expanded into Oregon’s growing wine business. After consulting with an expert wine-grape grower, Naumes planted 15 acres of grapes in 2012 on recycled orchards, which has expanded into 85 acres currently producing Pinot Noir, Grenache, and Chardonnay. Further analysis of the industry revealed a lack of sufficient processing capability in Southern Oregon to meet the growing supply of grapes, so Naumes further expanded their business by building a custom crush facility to not only crush their own grapes, but those of other farmers as well. In its first year in 2015, the facility crushed approximately 100-150 tons of grapes, but now crushes over 500 tons.

While Naumes sells most of their grapes to other wineries, they have begun making some wines themselves. Currently, they have facilities with a 500-ton capacity. Their label, “Naumes Family Vineyards” was recently launched in early 2018, along with a wine club specializing in Pinot Noir grown in the Rogue Valley, Pinot Gris, Chardonnay, Grenache, and many other estate wine grape varieties. The Naumes Suncrest Winery and tasting room in Talent, Oregon opened in July 2019.

Managing all the orchards, as well as the production and storage facilities requires a great deal of labor which is difficult to find. Depending on the season, Naumes employs between 300 to 1200 individuals. Much of the work is labor-intensive, and bilingual skills are extremely helpful. Due to the lack of local workers, Naumes has had to hire individuals with temporary agricultural worker visas. Whether skilled, professional, or manual labor, Naumes is focused on hiring employees who will inject new ideas and energy to help keep the business growing strong into the future.

Bringing more businesses to Southern Oregon would help Naumes in many ways. More shipments to local businesses means more efficient opportunities to secure backloading arrangements with trucking companies, a particular challenge to Naumes. In fact, having accessible distribution centers and packaging supplies locally would benefit Naumes greatly.

Naumes believes in supporting the local economy, and buys local whenever possible.

Mike and Laura Naumes, currently owners of Naumes, are proud of the business that Mike’s father started nearly 73 years ago.

They look forward to the opportunities that lie ahead for their triplet children; Joe, Cynthia, and Sean; who are already very active with roles in the business.

www.SOREDI.org/edge

by SOREDI | Southern Oregon Regional Economic Development, Inc.

Naumes Family Vineyards | 1950 Suncrest Rd, Talent, OR 97540 | www.naumesfamilyvineyards.com | 541-608-1755

Southern Oregon Business Journal September 2019 | 16

MANAGEMENT JIM MYERS

In this, the final installment of our six part series, we look at how we as managers can incorporate change into our organizations to take advantage of the lessons learned so far.

The picture of Boeing’s iconic 737 airliner represents a culmination of aviation lessons for business managers. In microcosm, the 737 represents the result of five activities all organizations must do to be viable. Boeing observed their environment, as well as, communicated, organized and delivered a product that it has improved over time. The ability to Observe, Communicate, Organize, and Deliver are crucial to short-term success.

In the long term, the ability to Improve and, by necessity, change gains importance.

In this series we have looked at the value of accurate observations and how they lead to opportunities; communication of knowledge using a structured approach; organization of teams in the context of business needs; delivery of value through the natural process of learning and finally improvement as an integration of organizational attributes. Each lesson represents an exception to ‘business as usual’. If the lessons are to have value to you in the approach you take to managing operations, it is worthwhile to look at the subject of organizational change.

Flying Lessons: How stories from Aviation can make us better Managers – Final installment

John F. McDonnell, of the McDonnell Douglas Corporation (at the time of its merger with Boeing in 1997, the third largest aerospace and defense company in the world), made this observation about organizational change: “While it is difficult to change a company that is struggling, it is next to impossible to change a company that is showing all the outward signs of success. Without the spur of a crisis or a period of great stress, most organizations - like most people – are incapable of changing the habits and attitudes of a lifetime.”

McDonnell’s observations provide three insights: First, nothing breeds compliancy and satisfaction with the status quo more than success because that very success validates current approaches to business.

Second, a crisis and associated heighten levels of stress provide an opportunity for change, but often at an inopportune time.

Third, habits and attitudes develop over a long period, becoming firmly engrained in the cultural fabric and as a result resistant to change.

Success, then, is a double-edged sword.

Most businesses owners work hard to meet their goals and become successful. The tried and tested approaches applied to solve

problems become proven and an integral part of the company culture, defining how things are done. Attitudes are the mental manifestation of an organization’s culture, just as habits are the physical result of the same learned behavior. Without those attitudes and habits, and the continuity and predictability they provide, a business would soon regress into chaos. As well, attitudes and habits also create a rigidity that prevents change in the face of new circumstances.

Edgar Schein, culture researcher and professor at MIT’s Sloan School of Management, described culture as: A pattern of basic assumptions that a given group has invented, discovered, or developed in learning to cope with its problems of external adaptation and internal integration, and that have worked well enough to be considered valid, and, therefore, taught to new members as the correct way to perceive, think, and feel in relation to those problems.

James G. Hunt built upon Schein’s work developing an ‘Onion Layer’ model of organizational culture (see diagram). The model presents organizational culture in the

Southern Oregon Business Journal September 2019 | 17

Management (Continued)

form of layers – the core hidden from view progressing to an outer layer that is easily visible. Core Assumptions typically evolved from the founder(s) worldview, tend to be non-debatable and reflect a fundamental outlook integral within the organization that is taken for granted. Values and Beliefs represent a culturally common understanding of what ‘ought’ to be and provides a means to rationalize statements and actions. Artifacts and Behaviors represent the physical reality and actions taken by members reflecting patterns, standards and norms of behavior. Hunt’s model provides a useful way to frame culture.

Charles Duhigg, in his book “The Power of Habit”, outlined how habits are formed as a result of a cycle of routine. On cue, a routine is executed and reward is provided.

In the context of an organization, the cue could be a situation similar to past situations upon which an individual or team exercises a routine and is rewarded upon its

success (see Habit Loop diagram). The connection between a cue, the routine and a reward is important because it provides an understanding of how habits, after becoming established, become automatic responses to familiar situations.

Habits are the activities we do every day. As applied knowledge, habits are justified by

attitudes. In the context of an organization when attitudes provide us with identity, support our experiences and are socially reinforced by our team they become entrenched and hard to change. This reality is important to remember in light of the challenges faced attempting to change those “…habits and attitudes of a lifetime.”

18 | Southern Oregon Business Journal September 2019

We end up with a model in which Assumptions support Attitudes, which justify Habits (Assumptions -> Attitudes -> Habits). As managers, working with the context of culture, there is tendency to address problems in a practical manner and move on. Rarely is there an opportunity to tackle what can be seen as extraneous factors. This can lead to crisis, as problems are addressed but perhaps not solved. Let us look at an example dealing with product delivery and apply what we have learned.

Example: The company policy is “On-time Delivery is Job #1”. If asked, team members willingly testify and agree that delivery dates are a

priority. Historically this policy is culturally reinforced with stories about the extreme measures taken in the past (working weekends, expediting parts, etc.) to ensure that customers are not disappointed. The attitude of doing whatever it takes to avoid missing a ship date has its origin is the core assumption that timely shipments create satisfied customers who return to do more

business. Attitudes and habits evolve in light of the assumption allowing team members to process orders and deliver products on time. The assumption reflects a valid perspective, the attitude leadership’s intent and the habit the fulfillment of that intent. Assumption: Timely shipments equal satisfied customers -> Attitude: All orders ship on time -> Habit: Take whatever measures are required to ship on time. Simple!

Upon receiving customer complaints about late delivery, a typical reaction is to ask why measures were not taken to ship on time.

We do this because (a) the problem of timely delivery had been addressed in the past, and (b) everyone in the company knows we ship on time. What could be wrong? For our example, success has resulted in demands exceeding the means to meet them. Habits created in the past are no longer appropriate to new realities.

While working weekends and expediting parts may have worked at one time, at some point they become overwhelmed and ineffective – creating a crisis. The effort to change is challenged because fully ingrained and validated habits from the past are linked to an attitude (extraordinary measures ensure timely shipment).

Attempts to change those habits (i.e. improve scheduling communication) seems to question the value of what has been done in the past. Unfortunately, people tend to link the habit (as a behavior) to the attitude (as a truth) and resistance to change can be profound. When efforts to change habits fail to take into account, and link, the new approach to established attitudes the efforts are bound to fail. The validity of a new approach in the eyes of the team is not only pragmatic (i.e. Does it work?) but it is also cultural (i.e. Does it fit with who we are?).

The Lesson for Managers. Business is dynamic and without the ability to improve through change, long-term success will be elusive. The ability to affect lasting change in your organization requires an awareness of your culture: its assumptions, attitudes and resulting habits. If a current problem results from a dated approach quickly becoming outmoded in the face of new circumstances, change is necessary.

Effective change efforts leverage cultural attitudes and link the new habits to accepted truths (“…improving our scheduling will allow us to ship on time and not have to work weekends and expedite parts…”). In this example, the old routine (extraordinary effort) is updated to reflect a new routine (process scheduling) that is in alignment with a pre-existing and accepted unchallengeable attitude. Explicitly linking a new approach to accepted values helps team members be open to the possibility of change because the new norm is not in violation of an accepted truth. Solutions need to meet the pragmatic standard of providing improved results (i.e. better outcomes, less effort) as well as the cultural standard of being in alignment with who you are (i.e. “We are the people who ship on time”). When you approach changing habits inside your company, take the time to address the attitude that justifies the habit,

and if possible, pay attention to the underlying assumptions that are at the core of who you are.

Further Reading Duhigg, Charles. The Power of Habit: Why We Do What We Do in Life and Business. New York: Random House. 2014.

Hunt, James G. Leadership: A New Synthesis.

Newberry Park: Sage Publications, 1991.

Leonard, Dorothy and Walter Swap. Deep Smarts: How to Cultivate and Transfer Enduring Business Wisdom. Boston: Harvard University Business School Press. 2005.

Schein, Edgar H. Organizational Culture and Leadership. San Francisco: Jossey-Bass, 1985.

2019 Praxis Analytics, Inc. All Rights Reserved.

Praxis Analytics web site: https:// praxisanalyticsinc.com/

Jim Myers is the principal and founder of Praxis Analytics, Incorporated. Jim serves as a trusted advisor to business leaders in their quest to translate intentions into results. His background includes two decades working in manufacturing, supply chain, customer service and maintenance management roles within markets that range from capital equipment to aerospace and defense. Jim balanced his practical operations experience with theory and served as the Associate Dean of the Atkinson Graduate School of Management (AGSM) at Willamette University where he led projects to improve school operations and taught graduate courses in Operations and Information Management, Strategy Alignment and Project Management.

Jim can be reached at jim@praxisanalyticsinc.com

Southern Oregon Business Journal September 2019 | 19

TELECOMMUNICATIONS

Oregon

The Oregon Connections Telecommunications Conference is coming to Ashland, Oregon. Oct. 24-25

CHRIS TAMARIN

The Oregon Connections Telecommunications Conference draws

expanded to include technologies, applications, regulation and public policy.

agencies, tribal, local and state governments, industry, universities and

attendees from all regions of the state to share ideas, experiences and knowledge

In past years, Oregon Connections has

non-profits on smart cities and communities projects and provides technical assistance to

about broadband telecommunications. In its twenty-fourth year, the conference will be

enjoyed keynote addresses by speakers such as Morgan O’Brien co-founder of

support the widespread deployment of broadband infrastructure.

exploring Smart Communities: strategies, applications, enabling technologies and

Nextel, Vinton Cerf of Google and co-author of TCP/IP the protocol of the Internet, Lee

Trever is Chief Experience Officer and

Oregon initiatives.

Rainie of the Pew Internet and American Life Project, Gigi Sohn of Public Knowledge

Founding Partner of ZEAL, a company empowering innovators to deliver the

Oregon Connections is a grass roots conference first held in Bend and hosted by

and the Federal Communications Commission, Steven Bass of Oregon Public

future of Web + Mobile Apps. ZEAL is a leading expert in Agile development, pair-

the Central Oregon Intergovernmental Council in 1996. Since then it has moved to

Broadcasting, and Paul Mitchell of Microsoft.

programming and "lean" methodologies.

different Oregon communities, hosted by Lincoln County Economic Development in

This year, Oregon Connections is looking

Conference Registration Fee: $90.00.

Newport, by Mid-Columbia Economic Development District in Hood River, and

forward to Keynote addresses by Jean Rice of the National Telecommunications and

Find out more and register at www.oregonconnections.info

now in Ashland hosted by Southern Oregon Regional Economic Development, Inc.

Information Administration from Washington, D.C. and by Trever Yarrish of ZEAL from Grants Pass.

The initial focus of the Oregon Connections was on infrastructure deployment in unserved areas of the state, but has

Jean Rice is a telecommunications expert and advisor who works with federal

20 | Southern Oregon Business Journal September 2019

Christopher Tamarin is the Telecommunications Strategist in the Oregon Broadband Office of Business Oregon. www.broadband.oregon.gov

Oregon Connections Smart Communities The 24th annual Oregon Connections Telecommunications Conference will be held on Thursday and Friday, Oct 24-25, 2019 at the Ashland Hills Hotel and Suites and Conference Center, Ashland, OR.

REGISTER ONLINE at OregonConnections.info $90.

Join Community Leaders from around the State

Connect, Learn and Explore

OCT 24-25

2019 Ashland

Our Keynote Speakers are:

The Oregon Connections Telecommunications Conference draws attendees from all regions of the state to share ideas, experiences and knowledge about telecommunications.

The 2019 conference presenters and attendees will be exploring Smart Jean Rice

National Telecommunications and Information Administration

Communities: strategies, applications, enabling technologies and Oregon initiatives.

Topics include smart cities, Internet of Things, new developing technologies, public policy and community planning.

The conference features speakers, panels, group discussions, breakfast -

Trever Yarrish CEO and Founding Partner, ZEAL

Email : info@oregonconnections.info Contact : Chris Tamarin

luncheon - refreshments, receptions and more.

Phone: (503) 508-0178 Web: www.oregonconnections.info

Thanks to our valued sponsors Wave Business, Hunter Communications, Fortinet, LS Networks, Genxsys Solutions, Zayo, Oregon Broadband Advisory Council, InfoStructure, AT&T, ADTRAN, Calix, Zyxel, Windwave Communications / Inland Development, PEAK Internet, the City of Eugene, Graybar / Ciena, Verizon Wireless, CenturyLink, Northwest Telecommunications Association, Ameresco, XKL, Southern Oregon Business Journal, Mid-Columbia Economic Development District, Business Oregon and Southern Oregon Regional Economic Development, Inc. ! ! !

INSPIRATIONAL BUSINESS PEOPLE

Deschutes

Meet Bend Artist Megan Myers

JIM TEECE

I had a chance to interview Bend Artist Megan Myers.

Were you born in Bend or how did you get there?

Megan's art is all over Bend and on the products that are made there.

I’m an independent fine artist, freelance illustrator, and owner of Megan Marie Myers Art LLC. I have an online shop where I sell my own line of greeting cards, fine art prints, calendars, and other paper goods. I also wholesale and participate in a number of art fairs.

She has been featured in other publications around the state but they focused on her art and I wanted to focus on her business.

22 | Southern Oregon Business Journal September 2019

I was born and raised in Medford, Oregon. After high school, I moved to Seattle for University where I focused on painting and received a BA in Visual Arts.

After school, painting remained a regular side-hustle, but my maingig for about a decade was a career in arts administration. Early in that profession, I worked for municipalities in the Seattle Metro area as a specialist for their

cultural arts, visual arts, and public art programs. In my midtwenties, I took a position in Seattle at Chihuly Studio where my job was to coordinate the logistics of creating and installing full scale gallery exhibitions of Dale Chihuly’s artwork as well as private commissions of largescale glass and steel art installations for public and private clients worldwide.

I moved to Portland in 2013 to be with my partner, Matt. At this time, I decided to make a major career shift. I took a job at the Hollywood District Trader Joes, where I was a sign maker. It was a blast. And with the newfound free time this position afforded me, I began working on creating and showing my personal artwork more seriously. The years in Portland mark the foundation-building period for my business. All this is to say, I didn’t just immediately quit my day job. I just found a job that I enjoyed, helped me refine my painting skills, and didn’t consume all of my time and energy. I would come home and still have gas in the tank to work on my artwork and learn how to start a business.

take the leap and work on my business and artwork full time.

Feeling the security that I could always go back to Trader Joe’s if I needed to, I decided to give the business a fighting chance. By this point, I had been creating artwork and working in the industry for about 10 years. So, I just felt like I’d done a lot of legwork and that it was the right time to go for it.

love about this place. I felt like the most important thing I could do for my life and my business in Bend was to make connections as a resident sharing the values of my community. I spent a lot of time making artwork that was inspired specifically by places in Central Oregon. I listened to people when they’d tell me why they loved living here and I listened to myself about why I loved it here. These sentiments became the heart of my work. For me, making art is about connection, so in a lot of ways, I just think it hit a nerve because people who choose to live here all want to feel a connection to place, nature, and each other in this tight-knit community.

“ When I was in school, it never occurred to me that if you decided to make art for a living, then it is a business. And you need to know about business just as much, or more, than you know about art. ”

Matt and I moved to Bend in 2015 because we both love the outdoors. At this time, I was faced with the decision to transfer to the Trader Joe’s in Bend or to

What makes Bend's economy work for you to set up shop there?

At the time, I don’t think I fully realized what an ideal time it was to start working on something like this in Bend. I personally feel like there are a number of contributing factors to why the work has done well here so far.

First, Bend residents LOVE living here and are very proud of our city, our outdoors, our people, and our active lifestyle. Residents seem to be very intentional about supporting local businesses and artists; they love to see work that reflects the unique qualities we

With the population growth here, many businesses are popping up rapidly and their needs for artwork are increasing too (think promotional merch, web and social media content, display on their walls, new retail items to sell) so there have been more opportunities than ever to collaborate. From the beginning, I thought it was important to connect face to face with as much of the community as I could. So I just tried to be present and show up to everything! I attended events whether I had a booth or not. I shopped local and introduced myself to the owners of different businesses. I went door to door to see if different

Southern Oregon Business Journal September 2019 | 23

shops or cafes would have any interest in hosting an exhibition of my artwork. The businesses in Bend are so generous about showing local art and we have a very well-attended art walk the first Friday of every month in which all the downtown businesses participate. I have a personal relationship with all of my wholesale accounts in town or places where I’ve displayed my work, which makes it really special. We want to see each other succeed and we lift each other up. So if I have a special project in mind, or if they do, we think about how to come together on it.

And then, of course, Bend has been seeing astounding growth in tourism. This has resulted in an enormous amount of opportunity for someone like me because there are so many events that invite local artists to participate.

Visitors to our town have their own special connection to this place and are making their own fun memories enjoying the outdoors. When they return home, it’s nice to take home a memento of a memorable trip.

I’ve felt lucky because the work is getting distributed far and wide just by visitors taking something home to share with their friends and family.

Your art is very nature oriented.

What inspires that? Is it market driven?

When I’m not making artwork, I’m trail running, hiking, camping, or

just staring up at the trees. The work is nature oriented because that is where I feel most at home, most exhilarated, and most inspired. And actually, I would say that while the work is natureoriented, it is foremost about relationships: our relationships to nature, our relationships to each

and connects you to the natural world and your community.

Whenever I get a chance to collaborate with the outdoor industry to help build the connections between people and place, I’m always excited for the opportunity. Zooming out, I also really hope that my work can do a small part to build healthy relationships between people and nature. If the work does anything to help create reverence for our planet, it may encourage each of us to do what we can to preserve and protect it.

“I don’t open e-mail or schedule meetings until after lunch. I spend my best hours of the morning on highly-concentrated creative work.” other, and our relationships to ourselves. That’s why I don’t typically paint landscapes alone; there are always characters in my work. By including them, a relationship is created. The characters function as our guides into the natural settings and I think that’s what makes the work feel approachable. So, I wouldn’t say that my initial intent was to find a hole in the market. It might have been something I stumbled into just from listening to people and what spiritually fills them up.

It’s been really cool to find that it’s resonating and I feel like the sentiment of the work sort of compliments the outdoor industry in an interesting way and it’s starting to get recognized for that a bit. Like, the idea that being an outdoors-(wo)man isn’t necessarily just about being a badass or winning races or whatever. It’s about doing something that fills your heart

24 | Southern Oregon Business Journal September 2019

(See more of what inspires Megan at SouthernOregonBusiness.com)

What is your studio like? Where do you create?

My studio is walking distance from downtown Bend and it is in my yard across from the house. It was formerly a spider-filled toolshed! But we upgraded it before I moved in, so it’s got a nice north-facing window, lights, drywall, plenty of shelving, and a heater for the winter. It’s not beautiful; nothing like what you would see on Pinterest! It’s pretty bare-bones and definitely a work space. Paint is all over the floor.

All the fixtures are hand-built and unfinished. I’ve got an area dedicated to shipping, and I have a large plywood easel for my big paintings. My splurge on the studio was a dutch door, which I painted teal, so in the summer, I

can swing the top of the door open and get a nice breeze.

Do you have a day job or is your art your full time work now?

Up until recently, I drew and painted everything, and it’s still my preference when it makes sense. My paintings are all quite large; I don’t typically paint anything smaller than a 18x24”

there are reproductions of the hand-painted artwork.

It’s full time. Haha beyond full time. And I can’t remember how I ever did it without putting in so many hours. But creating art is only half of the work and running the business is the other half; sometimes more.

There is ALWAYS stuff to do. The last few years have been a real lesson in trying to find balance between creating, business, and having a life and staying healthy. I just hired a part time employee this year which has made an indescribable difference. I’ve also taken some important time to read more business books and learn more about workflow, which has helped a lot.

Explain the creation of your art for me. Is it digitally created? Painted? Pencils? do you stand in a forest and just make it up there or do you work in a studio and work on ideas for a long time until one comes together and you pursue that.

anymore and I’ve got paintings all the way up to 48x60” (which hardly fit in a vehicle). I also paint murals. Working at the larger size is the most fun for me and creates the most impact. For the paintings, I use acrylic on canvas.

In my online shop, pretty much all of the cards and prints you’ll find

I get most of my inspiration from the outdoors, and I’ll sketch outside once in awhile, but I do all the heavy lifting in the studio. When I’m outdoors taking in an experience, I like to just feel it and let it sort of steep inside me without the pressure of making something on the spot.

Also, I feel like there is an alchemy that takes place in that time between having an experience and remembering it. I think it’s good for my work when I give myself a chance to allow the emotions to fully form about the initial experience. and I also find that the act of remembering can color and abstract the experience in really lovely ways. I work on ideas for a long time when I’m back in the studio. I love design and am very thoughtful about composition, color, visual hierarchy.

The design process can be so critical to setting the mood of the piece. Sometimes I think it would probably be good to “play” a little more and just go at the canvas intuitively; but it’s just not my preferred way of working.

Southern Oregon Business Journal September 2019 | 25

For client work, I’ve started to create more illustrations digitally using an iPad Pro. Working collaboratively often involves making a lot of changes or needing to efficiently communicate visual ideas. I’ve found that in many cases, digital work can offer an enormous amount of flexibility and efficiency.

Clients also typically need a digital file as a deliverable anyhow, so it’s nice to skip the step of digitizing an original piece of artwork if you can. I don’t see one method of creating as better than the other; I think there is the right tool for every job. I’ll admit that I used to resist working digitally and never expected that I’d enjoy it as much as I do.

different ways over the last few years. And I’m just happy to see that it resonates with people and means something special to them; that’s really the whole point. I couldn’t be more grateful to the Bend community and beyond who have embraced

Congratulations on your success. What has that been like for you? Your art is everywhere now in Bend it seems. It's on walls as murals and on products. How did that happen?

Thank you so much! It is really neat to see the work take form in

I can’t say for sure how it happened. I was just hustling so hard for what felt like a very long time and then suddenly there seemed to be a shift and I was gaining a little momentum instead of treading water. I think that if you just keep showing up to something in your life and

don’t give up, something has to happen. But it goes both ways – I was showing up so much for this, that it became very difficult for me to show up consistently in other parts of my life. Social engagements definitely suffered, as my very patient friends and family can attest.

I know you are an artist, but you are also a small business owner. Has that been hard for you to do both?

How do you juggle both the creative part of your craft and the need to make sure income is coming in and expenses are under control.

what I’m doing and have hired me or lifted me up by buying my work so that I can keep doing this for a living. I don’t take the support lightly.

26 | Southern Oregon Business Journal September 2019

Yes! It’s been very challenging. I’ve felt very lucky to have a working skillset from my arts administration career. Past experience was so important to keeping my business organized.

Project management, administration, installation logistics, communication, client relationship management, and event coordination was nothing new. But there were (and still are!) so many unknowns to me about wholesaling, setting up the business, and the finances. I’ve learned a lot on the job and I also use every resource that comes my

way. Talking shop with other people who have creative careers or run small businesses has hands-down been the best way to gain wisdom about the businessside of things that I never learned in school. This year especially, I’ve been devouring any audiobooks or podcasts that I can find on creative entrepreneurship and work flow. Until this year, I had a bad-habit that I formed in my project-management days, where I would get hyper-focused on executing details and wouldn’t make time to zoom out to see the big picture. Because of that, I’d find myself sacrificing creative work for office work constantly (E-mail !!! Filling orders! Admin!). I learned more about work flow for creatives and have been so much better about juggling.

There have been three major changes that have been transformative: 1) Unless utterly necessary, I don’t open e-mail or schedule meetings until after lunch. I spend my best hours of the morning on highlyconcentrated creative work. 2) I hired a part time employee to help with the day-to-day tasks, so I don’t fall behind on customer service while I’m doing creative work 3) I stopped doing all of my own bookkeeping and turned over my accounting to an actual accountant. It took me a few years of feeling completely under water to be able to support these changes financially, but it was also becoming clear that it wasn’t healthy or a sustainable business model to do everything by myself.

What's on the horizon for you?

I’m currently working on illustrations for a children’s book and am making moves to do more work in that field.

I’m also excited to get through event season (basically now – Christmas) and then spend some time creating new paintings and rolling out new products of my own. The last year has been heavy on client work and commissions, so I’m dying to put some focus on my personal work and a new

about art. That said, foremost, I would advise anyone starting out to take business classes alongside your art classes if you’re serious about making a living at it. I can’t believe that business classes aren’t required in an art program. There is nothing wrong with making art as a sidegig or hobby, but if you want to go full time with it – learn everything you can about business and know that at least half of your time will not be creating. A harsh reality! But don’t get down on the business side, because it is SO fulfilling and you get so many friends along the way. I would also encourage aspiring artists to have mentors. And collaborate as often as you can with other artists or businesses. Connect with other creative entrepreneurs (in person, not just online!) and talk openly about your struggles, triumphs, and be generous in sharing information.

We can learn a lot from each other. Every huge leap I’ve made in my business was because another generous business owner shared their knowledge with me.

And of course, cheer others on in your community and in your industry; a rising tide lifts all boats.

"Every huge leap I’ve made in my business was because another generous business owner shared their knowledge with me.” portfolio website. I’ve been really enjoying my freelance illustration jobs this year and want to give my website and portfolio a facelift to start seeking out some more commercial illustration work that might be a good fit.

Any words of wisdom you would like to share with aspiring artists that want to be successful like you? What do you wish you knew when you started?

When I was in school, it never occurred to me that if you decided to make art for a living, then it is a business. And you need to know about business just as much, or more, than you know

Check out more of her art at meganmariemyers.com

Jim Teece owns Project A as well as Ashland Home Net, Rogue Broadband and is a partner in Art Authority and Co-Publisher of the Southern Oregon Business Journal.

JimTeece.com

Southern Oregon Business Journal September 2019 | 27

ENTREPRENEUR TO ENTREPRENEUR

Jackson

Laz Ayala & KDA Homes

CYNTHIA SCHERR

August 27, 2019 E2E Meeting

Laz Ayala carried the American Dream inside him when he crossed the U.S. border in the trunk of a Cadillac as a 14-yearold. Now Laz, with partners Mark Knox and David DeCarlow, are making the American Dream of owning a home accessible to Southern Oregonians. Southern Oregon Entrepreneur to Entrepreneur (E2E) visited KDA Homes to hear Laz’s immigrant success story and his vision for sustainable communities.

Laz fled the violence of El Salvador’s civil war in the 1980s.

His migrant experience, walking in the desert, shuttling from safe house to safe house, to finally being smuggled across a

checkpoint in Tijuana, shaped his adult life and his commitment to advocating for the immigrant community. A book about his journey and a documentary titled, Illegal, aim to humanize the current narrative around undocumented immigration, give voice to the voiceless and educate Americans about the immigrant experience.

Laz lives his life according to four P’s: People first, Positivity, Perseverance, and Purpose. E2E members could hear each “P” as Laz told us how KDA Homes was formed.

“Connections are powerful. This is how things get done: meeting,

28 | Southern Oregon Business Journal September 2019

sharing ideas, having conversations.” Laz’s philosophy aligns perfectly with E2E, a group of entrepreneurs that meets to do just that.

At 19, still undocumented, Laz got his start in real estate when a friend suggested it could be a great career for him. He shared that he “wanted to work with his head, not his back.”

Laz donned a gold coat with Century 21 Real Estate in Medford and became their top listing agent. He read every book, listened to every tape and developed a system for selling, knocking on doors all over town.

Likely due to his positive attitude

and diligence, agents supported him and the community embraced him.

Frugal and determined, Laz saved

enough to invest in rental property. He went back to school for his broker’s license and then to Rogue Community College for an AA degree in business.

He wisely put aside money prior to the recession, which enabled him to exercise opportunities for development in Ashland once the housing market collapsed. KDA Homes started six years ago.

Carefully analyzing the market, Laz and his team realized that entry-level housing was in high demand and short supply. They combined their commitment to affordability, sustainability and innovation in their new developments.

KDA Homes is pioneering a concept in sustainable community living including shared transportation.

Laz Ayala not only persevered with positivity, but he also put the needs of people first in all of his work. Hopefully, the connections and conversations through E2E

Medford and other localities have already shown interest in replicating their Garden Cottages development which features modest-size homes facing a common pollinator garden, certified life-long housing (e.g. no steps, wide hallways), laundry-tolandscape water recycling, netzero solar power, car charging stations, and a shared electric vehicle program. All in an area that is walking distance to downtown, close to an elementary school, the dog park and the Greenway.

It takes extraordinary hope, energy, and commitment to create a successful life in a new country.

will further fulfill his purpose as an advocate for immigrants and a visionary real estate developer.

To learn more about KDA Homes, visit their website at kda-homes.com.

And, to learn more about Laz’s movement to humanize immigration and ultimately influence our country’s immigration policy, visit illegaltheproject.org.

Cynthia Scherr has over 20 years of experience working with businesses, nonprofits, and government organizations. She also co-founded the Southern Oregon E2E network.

ScherrConsults.com

Southern Oregon Business Journal September 2019 | 29

INSPIRATIONAL BUSINESS PEOPLE

Jackson

Meet Mark and Maddy DiRienzo Self Storage and Commercial Real Estate Developers & Operators and Good People.

JIM TEECE

I have admired Mark and Maddy for years. They are good people that have developed commercial spaces for small business owners to thrive. They are also caring community leaders and a successful husband and wife team. I reached out to Mark with a few questions about is business for this issue and he did not disappoint.

Where did you come from and how did you end up in Ashland?

When we moved here in Summer 1998 from NYC, we never dreamed of being in the commercial real estate business.

We both came from corporate jobs, me as a VP at Marsh.com in the Aviation & Aerospace Insurance Dept. and Maddalena (Maddy) at www.christies.com in the Jewelry department. We quit our jobs and spent a year helping

friends and traveling in search of a place to raise kids….

We found Ashland.

After spending a few years in the Ashland area small business community (as General Manager of Paschal Winery, helping build the Rogue Creamery wholesale business and expanding the retail shop space, teaching business courses at SOU, helping diversify the Academy Award-winning Sorensen Design film camera robot business into the Aviation industry), in 2002, I had a chance to invest in and manage a large real estate project in Pagosa Springs, CO. I did that work from Ashland and got hooked on Real Estate. It was an industry that combined my unique mix of skills, including marketing, finance, project management, contracts, and general business sense.

30 | Southern Oregon Business Journal September 2019

I have worked in real estate ever since in a wide range of activities including; developing, private lending, constructing, asset managing, property managing, and land-use planning in multiple western states. Maddy has always been at my side as a business partner and key component to everything we do.

It helped a lot to marry someone smarter than I am!

In 2009, I stepped in as the Executive Director of Scienceworks to bring it back from the brink of extinction, fortunately that was a slow time in real estate.

I stepped back into Real Estate full time again in 2011, a time when there were plenty of opportunities!

You built a world-class business park that is focused on small business. Tell me about that.

The Mistletoe Business Park, LLC project located in Ashland, OR, started in 2006. Our first office building (7,500 sf) and large self storage facility (70k sf/ approx 300 units) was completed in 2007. I oversaw the whole project and Maddy focused on day-to-day operations of the storage business. Self Storage is considered a Real Estate investment but in fact it is really a business. We have employees, marketing, many many customers, and regular day-to-day retail office hours. So while it is a real estate investment, it takes a lot more time than a typical commercial investment.

We have had a total of 6 self storage facilities in Ashland, Talent, Phoenix, Medford, Bend and Beaverton over the past 12 years. We have recently sold a few facilities and are currently holding 3 of our largest, Class A quality self storage facilities.

Mistletoe Road Self Storage, Pear Tree Lane Self Storage in Phoenix, Oregon (2013 acquisition, 52,500sf/approx 300 units), and South Medford Self Storage (133k sf/approx 760 units).

Working in storage never has a dull moment. Its like any business, issues arise daily with staff, operations, administration, technology, physical building issues, hundreds of customers, all with unique needs, etc… While most people think self storage is used by people who have too much stuff, that truly is not the case. The majority of our customers are people in transition

- moving to a new city, selling their home, going through a divorce, dealing with a deceased relative's things. Storage provides them a place to keep things safe while they sort out their next phase in life. We also have local businesses storing current or excess inventory, antique or specialty cars, etc. We spend a lot of time training for customer service, letting our staff know that with every interaction they may be dealing with very fragile people in a state of mind that isn’t their norm. The more we can listen and care for our customer the better their experience will be. We pride ourselves on customer service and the quality of our spaces in an effort to provide the best possible experience for our customers. Maddy is the key to our self storage success. She is our District Manager overseeing all facilities and does an amazing job with our staff and day-to-day operations. I couldn’t do it without her.

We do have or have had other commercial buildings in several states that include office, warehouse, and production related buildings. The most fun part of owning these spaces has been helping to incubate small business and facilitate their growth over time. Some of our tenants started out in small offices and now have their own buildings that we’ve purpose built for them, it so rewarding to participate in helping someone's entrepreneurial dream come alive. I’d like to mention two local tenants in particular, Organic Alcohol organicalcohol.com and MaskIT maskit.us, both of whom have flourished in our spaces, and we’ve done all we can to facilitate their growth over time.

What’s next for you two?

At this stage in our lives, we have a choice to make: do we keep finding new projects, take more risks, make more long-term money and work 24/7? Or, do we manage what we have and spend our next decade or two living the life we’ve worked so hard to enjoy? It’s been a soul searching period for us thinking about this. I feel we are landing on choosing a slower pace in terms of number of projects and being very selective about what we want to work on. Having said that, Maddy and I make a great team, and we are constantly brainstorming about things we could be up to, some in real estate and some in other areas that we enjoy, like food, landscaping, and travel.

Working with our growing tenants and also being part of E2E has been rewarding and a good reminder of how much work goes into a start-up! That said, Maddy and I did the hard work early on, so I think our next phase will be focusing on being content with what we have and doing the best job with our current businesses, so that we can have a life outside of work!

Currently, I am Board Chair for The Hearth Storytelling project (thehearthcommunity.com) and this month I take over as Board Chair for Mercy Flights (air and ground emergency transportation in Jackson County for 70 years! mercyflights.com).

Jim Teece owns Project A as well as Ashland Home Net, Rogue Broadband and is a partner in Art Authority and Co-Publisher of the Southern Oregon Business Journal.

JimTeece.com

Southern Oregon Business Journal September 2019 | 31

AGILE MANAGEMENT

When did you last "retro" your retrospective?

ADAM CUPPY

Retrospectives are one of the many powerful tools to review and improve your team’s approach to solving problems.

For many project teams, they do a retrospective at the end of every 1–2 weeks. If you’re already in the habit of running a retro every week or two — Great! Keep it up! But, is it time to retro your retrospective? Are you optimizing the retro tool?

First, what are the goals of a retrospective: #1: Process-focused A retro can easily become a catch-all for people issues.

While many challenges may be the result of the wrong people in the wrong seats, a majority of issues come down to incomplete or broken steps in the process the team follows.

Accountability is hard when there’s not a process to be accountable to.

A process-focus puts attention on how we, as a team, create a winning scenario for ourselves. By using the retro to focus on the process, the team is owning the methods to be held accountable to. Not to mention, it allows people who are confused or unclear, to get clarity. #2: Consistently used You can do a retro at any time.

Many teams I’ve worked with would jump into a retrospective when things seemed uncertain or off-kilter. However, a word of caution…

When your team is unsure of the next opportunity to address process challenges, they’ll take

action at the moment a single person feels it’s most appropriate, irrespective of the rest of the team, or, in the best case, at a time when they can garner the most support from others.

The vocal majority will likely take ownership of making a change, rather than allowing all member of the team the opportunity to speak up and address their concerns; it’s less safe for

everyone involved. Consistency creates an environment of accountability and sets expectations. If others are jumping the gun, bring it up during the next retro (it’s very meta!)

Even if consistency looks like once every three months, it’s better than ad-hoc. If that’s too often, let the team reflect on that during the next retro, as a group. #3: Easy to run Our team is remote, and for years we’ve run our retrospectives with a basic 3–5 column Google

32 | Southern Oregon Business Journal September 2019

Sheet. It’s enticing to use a fancy tool to run a retrospective, but we’ve found this template to work better than all of them…

View the template: ZEAL Retrospective Template Yes, there are issues. At times fields will get overwritten by someone else or the internet is slow for someone. Regardless, whenever we bring on a new team member, they don’t need to log in or learn anything new; instead, they can dive in and participate.

If the tool is standing in the way of a higherobjective, then it’s not an effective tool. #4: Open to everyone on the project team I can’t encourage this enough — make sure the entire project team, regardless of roles/rank are able to participate equally. It’s like King Arthur’s round table.

The most common role kept from a retro is the Product Stakeholders. I can understand why: They often hold situational authority over the people on the project, so, it can be hard to speak openly or for them to keep directives to themselves.

I’ve been a Product Stakeholder, and fostering a level of trust that allows for a true openness is hard — feeling impossible, at times.

Regardless…

Don’t expect Stakeholders to have empathy for the struggles of the project team if they’re not

allowed to share in the process and celebrate the successes.

Otherwise, they’re outsiders and the best they can do it sympathize. Now, that doesn’t mean a Stakeholder is free to violate the guidelines of this process.

If your Stakeholder is having trouble following the tenants of a retrospective, sit down with them, talk through the goals of the retro, and how they can help best (of which the last option is “don’t participate.�) I say again, it’s a round table — no head. #5: Shame- and blame-free I look forward to the day, saying be “shame- and blame-free� seems entirely out of place — but alas, it’s not today. Retrospectives require open reflection; where all team members are openly discussing the good, bad and the ugly.

It must be a safe environment for the team, or the first thing to go is honesty. It’s like solving a puzzle without knowing how many pieces you have or what the final picture is supposed to look like. “Haven’t we already discussed and solved this?�

Maybe. But, that doesn’t mean the contributor feels it’s resolved.

While this may be an honest follow-up question, I’ve found it said in response to criticisms more than compliments and successes. An alternative would be, “let’s dig a little and see if we can find a better way to address this.�

On a rare occasion, a person is bringing up an issue that is resolved, the team is following

through, but they don’t like the action being taken or disagree with the decision. That’s okay.

This should not give permission to passive-aggressive questions.

Instead, I would discuss the concern again, identify a check-in point (example: “two retros from now�), and have a 1-on-1 with the person to make sure that there’s nothing underlying the issue that should be addressed. “These are all the same.�

The practice of “squashing� or combining similar topics is efficient — keep doing it — but make sure each individual

consistent practice lead to “personal issues.�

If all the above are in place and being followed consistently, personal issues are more easily identified by mentors/mentees and can be caught and addressed during 1-on-1s. #6: Engaging and time-based Engagement is key. It’s perfectly acceptable to change the format and frequency to re-engage the team. If the same person administers the retro, change it up. If the “goodâ€? column is a đ&#x;˜ , change it. Because the formula is basic, you can afford to have fun with it.

Retrospectives are not 60minute accountability meetings. Celebrate all of the hard work — whatever the result.

The first 2–3 retros are likely going to run longer than subsequent ones. In the beginning, a lot may come up; this will likely subside and get shorter. At ZEAL, an all-company retro might be as short as 15- to 30-minutes.

Shorter may be a sign that the team is not fully engaged, but let that be the trend for 3–4 retros before you bring it up. Summerand holiday-time will often make retros run short — it’s all good‌ for a while.

Retrospectives are not 60minute accountability meetings.

Celebrate all of the hard work — whatever the result. contributor is in agreement that their concern is being addressed.

If you find that the concerns of a few people are consistently being squashed, I would suggest holding off. It might add a few minutes to the retro, but take the few minutes over silencing a fellow team member. “Sounds like a personal issue.�

It’s possible but unlikely. I’m a firm believer that most issues are a process problem more than a people problem. Dig for the systemic issues that lead to the issue. Often a lack of clear objectives, regular check-ins, direct (not passive) communication, and/or

Adam Cuppy, Chief Operating Officer, Founding Partner Confidence advocate on a mission to kill the apathetic developer meme. codingzeal.com

Southern Oregon Business Journal September 2019 | 33

NONPROFITS

Oregon

DALLAS FRIDLEY

August 13, 2019

Oregon’s Nonprofits in 2018

corporations, available at this URL:

an integral role in Oregon's economy. They made up 6.2 percent of all private businesses in the state and had 196,300 jobs, accounting for 11.9 percent of Oregon's private-sector employment.

As a share of Oregon's total (private and public) employment, nonprofits made up 10.3 percent in 2018, about the same amount as the manufacturing industry (10.2%).

https://www.doj.state.or.us/charitable-activities/

Beyond employment, the organizations make available essential human and education services that for-profit private companies do not

A not-for-profit corporation, commonly referred to as a "nonprofit," is organized to achieve a purpose other than to generate a profit. These entities qualify for federal tax exempt status and must reinvest any surplus revenues into efforts that further the mission of the organization. They are prohibited from passing profits on to those who control the organization. These organizations range from trade unions and religious groups to food banks and private schools. Many hospitals are also organized as nonprofit corporations.

https://data.oregon.gov/Business/ActiveNonprofit-Corporations/8kyv-b2kw

Likewise, the Department of Justice has a searchable database for Oregon charities, here:

In August 2019, the Department of Justice database includes about 20,900 registered

The services are essential. Wages earned by employees at nonprofits are too. For the purposes of this article, the impact presented is limited primarily to employment and wages.

Oregon's 2018 nonprofit stats: • 9,800 nonprofit establishments • 196,300 nonprofit jobs • 43 percent of all nonprofits were in the other services industry • 61 percent of nonprofit employment was in health care • $52,038 in annual average pay • $23.07 median hourly wage (1st quarter 2018) • 23 percent of nonprofit jobs paid $15.00 or less per hour • Most nonprofit jobs – 59 percent – paid $20.00 or more per hour Keep in mind that not all nonprofit organizations are employers – and these organizations would be overlooked if relying solely on employment data. Nonprofits in Oregon must register and be certified by the Secretary of State’s office, while the Department of Justice regulates charitable activities.

The Secretary of State’s office provides a searchable database of active nonprofit

Oregon charities, while the Secretary of State’s registry listed nearly 31,600 nonprofits, as presented in the accompanying chart.

provide. The services offered by nonprofits often complement those provided by the public sector.

Unlike the public sector, which is often required by law to provide human and education services, nonprofits are beholden to a mission, not a state or federal statute. The organizations are compelled to extend their hand to every community member who walks through their doors.

How Many Nonprofit Employers Are There in Oregon?

In 2018, there were 9,800 nonprofits business units that filed an employment report in Oregon.

Most of these employers (94%) averaged one or more jobs in 2019 but around 600 units missed that threshold. Nonprofit organizations played

34 | Southern Oregon Business Journal September 2019

Nonprofits by Industry

Oregon's nonprofit employment in 2018 (21,100 jobs). The organizations in this industry range from preschools and tutoring services to colleges and employment training places.

Nonprofit elementary and secondary schools represented the biggest slice with close to 9,900 jobs (47%) and 345 reporting units (41%).

Nonprofit colleges, universities, and professional schools accounted for just over 9,000 jobs (43%) while representing 18 percent of the nonprofit educational services provider reporting units.

Other schools and instruction, including sports training, provided nearly 1,500 jobs (7%), and a more significant 21 percent of nonprofit educational services provider reporting units.

Pay at Nonprofits Follows Industry Standards

Health care and social assistance dominated Oregon’s nonprofit employment in 2018, representing 119,900 jobs or 61 percent. Other services included 25,400 nonprofit jobs and educational services employed 21,100. Together the top three industries represented nearly 85 percent of Oregon’s total nonprofit employment.

Service Organizations

The other services industry had about 13 percent of the state's 2018 nonprofit employment (25,400 jobs). The correlation between other services and nonprofits makes sense. It is the industry that includes religious, grant making, civic, professional, and similar organizations.

Places of worship, the Boys & Girls Club, The United Way, and local chambers of commerce are some of the most widely recognized nonprofits in Oregon, and there are a lot of these organizations across the state. The graph based on firms shows that the industry included 43 percent of Oregon's nonprofit organizations (4,250).

nonprofit employment. Like other services, the industry is diverse, covering activities from assisted living facilities to mental health services.

However, hospitals dominate the sector’s employment. Oregon’s nonprofit hospitals (general medical and surgical; psychiatric and substance abuse; and specialty) included 68 reporting units in 2018 and employed 56,200, or close to half (47%) of the nonprofit health care and social assistance industry's. Hospitals in Oregon (government and private) included 97 reporting units and provided 68,000 jobs in 2018, with nonprofit hospitals representing about 83 percent of the employment.

Educational and Employment Training Providers

Nonprofit Hospitals: Health Care and Social Assistance

Health care and social assistance led nonprofits with 119,900 jobs or 61 percent of Oregon's

Educational services accounted for 11 percent of

Oregon's private for-profit industries paid an average $52,038 in 2018, compared with $51,844 for nonprofits, a difference of just $194, or 0.4 percent. The 2018 data show that annual

average wages in Oregon typically have more to do with the industry than for-profit or not-forprofit status.

Southern Oregon Business Journal September 2019 | 35

percent of all metro employment. With 8,050 employer units, metros provided a home base for nearly 82 percent of Oregon nonprofits while representing just 5.8 percent of all metro employer units. In 2018, nonprofit pay averaged $53,016 in metro Oregon, falling 3.2 percent (about $1,800) below the all industries average.

Oregon jobs, or close to 9 percent of all industries employment. Rural nonprofit pay averaged $44,466 in 2018, which exceeded the average for all industries by about 13 percent or around $5,100.

In 2018, four industry sectors reported higher annual average wages for nonprofits compared with for-profit businesses. Nonprofits in financial activities paid an average of $78,965 in 2018, which exceeded for-profit pay by about $10,100 or 15 percent. Leisure and hospitality also favored nonprofits by just over $4,700, despite having a relatively low annual average pay of just $27,245.

In Oregon’s metropolitan areas, nonprofits provided close to 173,900 jobs in 2018, or 10.5

Health care and social assistance, Oregon’s largest nonprofit industry, enjoyed a pay advantage of more than $12,500 or 27 percent over for-profit employers, paying an average of $58,089 in 2018. Other services, with 13 percent of nonprofit employment, averaged $30,733 in 2018, falling about $4,300 or 12 percent below for-profit employers. Educational services, with 11 percent of Oregon’s nonprofit employment, paid an average of $40,170 in 2018, exceeding for-profit pay by more than $6,800 or 20 percent.

Rural Versus Urban

Oregon's 23 nonmetro counties provided a home base for about 1,800 nonprofit employer units in 2018 or 7.2 percent of all rural employer reporting units. Nonprofit organizations provided about 22,500 rural 36 | Southern Oregon Business Journal September 2019

Only four rural counties employed more than 1 percent of Oregon’s nonprofit employment in 2018. Douglas County led rural Oregon with about 3,300 nonprofit jobs, or 1.7 percent of Oregon’s total, followed by Klamath County (1.4%), Umatilla County (1.1%), and Wasco County (1.0%). Metropolitan areas commanded 88.6 percent of Oregon’s nonprofit employment led by Multnomah County’s 33 percent (about 65,300 jobs). Together with Washington County (10.8%) and Lane County (8.5%), Oregon’s top three metro counties represented more than half (52.5%) of all nonprofit jobs in 2018.

The real impact of nonprofit employment across the state can be seen in the accompanying map.

In 2018, there were 14 counties where nonprofit employment made up 10 percent or more of total county employment.

That matches up pretty well with the Pew Research Center’s 2014 Religious Landscape Study, which ranked Oregon as the 39th most religious state (49% of adults were “highly religious”). Alabama, the most religious state according to the Pew Research study (77% “highly religious”), ranked 10th for its itemized charitable contribution ($7,543), while its AGI ranked 46th. Getting back to Wyoming, 54 percent of its adults were defined as “highly religious,” ranking 22nd, while its AGI ($70,800) ranked 14th.

Charitable Giving

The IRS produces tax data for itemized returns showing deductions for charitable giving.

According to the IRS definition, a charitable contribution is when you donate money (including securities or business ownership interests), goods or services to an organization and deduct the market value of this contribution on your income tax return. Your charitable contribution can be given to:

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SUPPORT OUR JOURNAL

5 ways you can help our mission.

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Churches, synagogues, temples, mosques, and other religious organizations

The Future of Nonprofit Employment

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Federal, state and local governments, if your contribution is solely for public purposes (for example, a gift to reduce the public debt or maintain a public park)

The future of nonprofit employment in Oregon is directly linked to the future of the health care and social assistance industry. The nonprofit health care and social assistance industry doesn’t rely exclusively on charitable contributions, although these businesses often hold a direct religious affiliation. Private health care and social assistance grew by about 5,200 jobs or 2.2 percent in 2018 while an additional 16,700 jobs moved into the industry with the reclassification of home care workers from state government.

The industry averaged about 257,900 in 2018, a one-year increase of 9.3 percent. With 61 percent of Oregon’s nonprofit employment in 2018, health care and social assistance will largely determine how and where new jobs are gained.

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Nonprofit schools and hospitals

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The Salvation Army, American Red Cross, CARE, Goodwill Industries, etc.

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War veterans’ groups

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Expenses paid for a student living with you, sponsored by a qualified organization

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Out of pocket expenses when you serve a qualified organization as a volunteer

In 2016, 45.5 million U.S. tax returns were itemized – representing close to 30 percent of all returns. About 37.1 million returns claimed a charitable contribution; accounting for 82 percent of all itemized returns. The average 2016 itemized charitable contribution was $6,349, representing about 18 percent of all deductions claimed.

In Oregon, itemized charitable contributions averaged $4,935 or about 15 percent of all itemized deductions. A somewhat lower share of Oregon itemized returns, 79 percent, included a charitable deduction. It is important to recognize that adjusted gross income (AGI) varies widely from state to state – with U.S. AGI for all returns averaging $69,351. Oregon’s AGI averaged $66,438 in 2014, ranking 18th among U.S. states (and the District of Columbia). Oregon’s itemized charitable contribution ranked 41st out of 51, well below first place Wyoming’s $12,991.

For example, Providence Health & Services in Oregon is a not-for-profit network of hospitals, health plans, physicians, clinics, home health services, and affiliated health services.

Providence is the largest health care provider in Oregon and one of the largest private employers in the state. It reported 2016 employment of 20,597 in Oregon, of which 3,650 were active medical staff. Providence health plans cover about 600,000 Oregonians, while reporting a community benefit of $417.5 million.

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TECHNOLOGY ASSOCIATION OF OREGON MATT SAYRE

Lane

Gearing up to explore and celebrate the Silicon Shire

“Tourists” check-in to the 2017 Eugene Tech Tour [Athena Delene]

You might be surprised to learn that the city that hosts the largest open house of tech companies in Oregon isn’t Portland. No, that title currently belongs to Portland’s cooler little brother, Eugene. (Little sister?) Every year since 2016, dozens of tech companies have joined together in downtown Eugene and collectively opened their doors to the public. They’ll be doing it again in October.

The Eugene Tech Tour provides the public a rare inside look at the companies that are driving one of the region’s fastest-growing industries. Tourists and job seekers alike will have a unique opportunity to see the operations first-hand and learn about some of the innovative products and technologies that are being developed locally.

But first, some planning So what does it take to put on Oregon’s largest open house of tech companies?

“Months of planning” says Lauren Neel, events manager for the Technology Association of Oregon. “The event itself only lasts a few hours, but takes months of planning and preparation to be successful,” she shares.

“Right now I’m also spending several hours a day reaching out to local tech companies who want to participate. Last year, nearly 40 companies were on the Eugene Tech Tour.

This year our goal is 50 — and we’d like to get a giant crowd photo of everyone at the event kickoff,” notes Neel.

The timing couldn’t be better The Eugene Tech Tour has historically been held on the third Thursday in September.

This year, however, the event is being moved to October 3, with the aim of increasing student access — Lane Community College

classes start September 20, and University of Oregon classes begin October 1.

Student awareness of the local tech industry is improving, but still has a long way to go before it can be considered successful. A recent survey conducted by the Technology Association of Oregon noted that just 32% of University of Oregon students are aware of the many employment opportunities at local tech firms.

More than a foot in the door Nearly every company on the Eugene Tech Tour will have multiple job openings, and the tour opens doors to job seekers — literally.

Software consulting firm Concentric Sky has been on the Eugene tour since its inception. “We really enjoy Tech Tours,” says Jennifer Rae, operations director with the firm. “We get to show folks around and see Southern Oregon Business Journal August 2019 | 40

them get excited about the things we do everyday. It’s also a nice self-reminder about

accessible — if you get on their calendar in advance,” says Neel.

organizations, including IDX Broker and Symantec.

how awesome the work is here at Concentric Sky.”

In addition to speakers, local band Upstate Trio will perform during registration and check-in. “We are stoked to be a part of the Eugene Tech Tour, supporting the tech scene in the Silicon Shire” says Jay Waylett, lead guitarist for Upstate Trio. As it happens, Waylett also works as a supervisor for the Customer Experience Delivery Team at Symantec.

Cheers to the after-party

Concentric Sky accepts resumes at the event and has hired applicants they first met on past tours. The firm has a number of current job openings, including devops engineers, front-end developer, UI designer, and in accounting, software engineering, and project management.

UBCO, makers of an electric two-wheeldrive utility vehicle, will be looking to hire a marketing manager, inside sales, outside sales, and a controller, as well as people for customer support/service technician roles.

Pipeworks Studio, the largest video game studio in Oregon and headquartered in Eugene, has also just signed on to the tour.

Pipeworks has more than half dozen openings, including: game designer, QA tester, C++ engineer, and associate producer.

Speakers Kristina Payne, executive director of Lane Workforce Partnership, and Eugene mayor Lucy Vinis are confirmed speakers at the opening ceremonies. “We live in a pretty special city where public officials are

Volunteers Events of this scale, hosted by nonprofits and with low admission prices, are typically not possible without the help of a community of volunteers. From opening ceremonies to the event’s after-party, volunteers help to ensure a smooth flow during the Tech Tour.

“We have many different volunteer roles, from setup to registration and check-in, to tour guides who help tourists find their way to the participating tech companies.” says Neel.

This year, the Tech Tour is sponsored by Lane Workforce Partnership, the City of Eugene, Lane County, and XS Media.

Volunteer staff will come from a host of

With the staff of each of the participating companies greeting tourists at their offices earlier in the evening, it isn’t until the afterparty that tech industry employees get a chance to celebrate together. This year the event will be hosted at Level-Up arcade, sharing refreshments from Claim 52 Brewing. Everyone is welcome.

Matt Sayre VP, TAO / Head of TAO - Southern Willamette Valley Matt is an Oregon native and University of Oregon Alumni, with degrees in Economics, Business, and Geography.

Technology Association of Oregon 123 NE Third Avenue, Suite 210 Portland, Oregon 97232

Southern Oregon Business Journal August 2019 | 41

GROSS RECEIPTS TAX GREG HENDERSON

Oregon

Oregon’s New Gross Receipts Tax

What It Means to Oregon Businesses

Oregon State Archives

August 27, 2019 On May 16, 2019, Governor Kate Brown signed House Bill 3427 into law.

The legislation accomplishes the following: Establishes a "Fund for Student Success" that is separate and distinct from the state's general fund.

Adopts a new Corporate Activity Tax (CAT) imposed on all types of business entities.

Every tax should include an understanding of its application and its purpose. The Governor’s signing of a bill into law is rarely the last step.

Often there are determinations that certain phrasing and actual statements must be corrected according to law and recommended amendments included. It’s a process.

Over the next four or five months we will be adding new information about this law as it becomes available. The final understanding with thorough explanation may not be completed until next spring, though we intend to provide all the details necessary for determining the responsibility of Oregon’s businesses.

Information can be followed at the Southern Oregon Business Journal website, www.southernoregonbusiness.com NFIB State Director Anthony Smith explains the tax in this way: Known by supporters as the Student Success Act, the bill directs more than $1 billion in new spending annually for K-12 education via the creation of a new Corporate Activities Tax (CAT).

The CAT is a consumption-based, business entitylevel gross receipts tax that takes effect January 1, 2020 (so long as the measure is not rejected by voters via referendum.)

The tax is $250 + 0.57% of Oregon sales for businesses with $1 million or more in annual gross receipts, or “commercial activity,” a defined term in the legislation, but with many exclusions.

It applies to all business entities, regardless of business structure: C corps, S corps, partnerships, LLC’s, and sole proprietorships. Businesses with $750,000 in commercial activity must file, even if they have no tax liability. Those businesses with $750,000 or less in commercial activity are exempt.

The proposal includes a 35% subtraction against commercial activity: The greater of cost of goods sold or labor costs. The bill also includes a 0.25 percentage point reduction in personal income taxes for most Oregonians, excluding those that pay at the 9.9 percent rate. This provision is separate from the sections in HB 3427 that established the CAT, but will impact each business-owning taxpayer’s bottom-line tax Southern Oregon Business Journal August 2019 | 42

liability. The new individual tax rates also begin in tax year 2020.

The bill passed by a vote of 37-21 in the House, and 18-11 in the Senate.

Frequently asked questions What is the Corporate Activity Tax (CAT)?

A: The CAT is imposed on businesses for the privilege of doing business in Oregon. The amount of the CAT is based on taxable commercial activity.

When will the CAT start?

A: The CAT is applicable to tax years beginning January 1, 2020.

How are "commercial activity" and "taxable commercial activity" different?

A: Commercial activity is gross receipts originated in Oregon. Taxable commercial activity is commercial activity, less certain expenses apportioned to Oregon.

Who is subject to the CAT? A: All persons or unitary group of persons with Oregon commercial activity in excess of $750,000 are required to register for the CAT. All persons or unitary group of persons with Oregon commercial activity in excess of $1 million are required to file a CAT return. All persons or unitary groups of persons with taxable Oregon commercial activity in excess of $1 million are required to pay the tax.

Persons or unitary groups of persons includes C and S corporations, partnerships, sole proprietorships, and other business entity types.

How often am I required to file and pay?

A: CAT returns are due each year on April 15. CAT estimated payments are due April 30, July 31, October 31, and January 31 for the preceding quarter. Further instructions on how to make payments will be posted soon.

When do I need to register for the CAT? A: Registration is due within 30 days of when you know you’ll meet the $750,000 registration requirement. A penalty of $100 per month may be assessed for failing to register, up to $1,000 per calendar year.

What are the tax rates for the CAT? A: The tax rate for the CAT is $250 plus .57% of taxable commercial activity in excess of $1 million.

What items are excluded from the definition of commercial activity?

A: The CAT legislation has a list of items that are excluded from the definition of commercial activity.

See Section 58(1)(b) of HB 3427 (2019), as modified by Section 50 of HB 2164 (2019).

How can I contact the Oregon Department of Revenue with questions about the CAT? A: Visit our website at https://www.oregon.gov/ DOR/. Click on the "Business" link, then the "Corporate Activity Tax" in the "Information" column on the next page. We have a mailing list registration for future updates. Also, you can email your questions to Cat.help.dor@oregon.gov.

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Send your ad copy to: Greg@SouthernOregonBusiness.com Greg Henderson, Co-Publisher

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Who is not subject to the CAT? A: The CAT legislation includes a list of business entities that are not subject to the CAT. See HB 3427, Section 58(6) and HB 2164, Section 50.

Greg Henderson is the founder and Co-Publisher of the Southern Oregon Business Journal.

Greg@SouthernOregonBusiness.com

Southern Oregon Business Journal August 2019 | 43

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