August 2011
Company Spotlight: Attention to detail sparks construction company pg 18
Real Estate
Construction
Continued commercial growth pg .30
Adjusting to change pg. 32
Higher Education Collaboration is good for the workforce pg .24
Community Spotlight: Sioux Falls becoming a national player pg 34
MONEYpg 49 LEADERSHIPpg 20 TECHNOLOGYpg 22 CHANGE SERVICE REQUESTED
pg 38
pg 51
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BISMARCK S TA T E C O L L E G E
N o r t h D a k o t a ’s f i v e p u b l i c c o m m u n i t y c o l l e g e s a re p a r t o f t h e N o r t h D a k o t a U n i v e r s i t y S y s t e m .
CONTENTS
Volume 12 No. 8
6
From the Editor’s Desk
8
Professional Spotlight
8
Matthew Mohr
10
Prairie News
14
Prairie People
16
Livestock income creeping back up into the black
18
Company Spotlight: That attention to detail sparks Kraus-Anderson Construction Attention to detail has now become an attitude for the company.
20
Leadership and Management Creating a culture of excellence with great service
22
Technology - Choosing technology for a positive ROI
24 30
Higher Ed: Collaborating is good for the work force In the end it is still about educating and developing a sufficient work force for the region’s business industry.
Real Estate: Fargo, Bismarck expected to see continued commercial growth An online publication has listed Fargo, ND, and Bismarck, ND as two of 10 real estate markets to watch throughout 2011.
32
Construction: Construction industry adjusting to change The construction industry has seen changes over the past few years and companies throughout the region are adjusting to the changes.
34 38
Community Spotlight: Sioux Falls becoming a national player Sales and Marketing - Businesses wrestling with benefits of social media
48
Rapid employment increase hits the Midwest
49
Money – Taking your small business online
50
Viewpoint
51
Economic Development - Campus enhancements vital to the success of Region
54
40
By the Numbers
4 Prairie Business
August 2011
42
Safety in the oil fields is also about business Companies are making safety even more of a priority; not only from a safety standpoint, but also from the business aspect.
Campuses uncover savings in alternative energy Many universities across our region are focusing on alternatives and efficiency to meet the dual goals of costsavings and a “greener” approach.
46
Wind-to-battery project providing insight for renewable energy A wind-to-battery project near Luverne, MN could someday spawn new jobs and new businesses.
Next Month In September, Prairie Business magazine will showcase how venture capital and angel investment impact business in the region. In addition, our cover topics will include retail strength and how the hospitality industry handles the ‘Other Seasons.’
On the air Join Prairie Business magazine Editor Alan Van Ormer and host Merrill Piepkorn on Tuesday, August 9 at 3 p.m. on any Prairie Public radio station to hear more about the August cover stories. To listen to Prairie Public, visit www.prairiepublic.org/radio/hear-it-now.
From the editor’s desk
For daily business news visit prairiebizmag.com
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Helping during time of need Not only has the flooding down the Missouri River and Souris River forced residents to move out of their homes, it has also impacted businesses in the devastated areas.
Mike Jacobs, Publisher Alan Van Ormer, Editor Scott Deutsch, Sales Manager Tina Chisholm, Production Manager Beth Bohlman, Circulation Manager Kris Wolff, Layout Design, Ad Design
NATIONAL ACCOUNT SALES/GENERAL MANAGER:
Scott Deutsch SALES:
Brad Boyd
John Fetsch hen I started receiving press releases from companies who are making major donations to help those impacted in the flooding areas it did not surprise me one bit! I would expect nothing less from those who live in our communities or work in our communities. For example, Hess Corporation, headquartered in New York, donated $1 million toward flood relief efforts. An estimated $750,000 is expected to go toward the Minot Area Community Foundation and the remainder, or $250,000, to the North Dakota Community Foundation. The money is to be used by these groups to provide services to flood victims and assist in long-term recovery and rebuilding efforts in Minot and other areas in the state. Wells Fargo also chipped in $75,000 to assist with the Souris River and Missouri River flooding affecting Minot, Bismarck, and Mandan residents. The donations include $25,000 for the American Red Cross from the Wells Fargo Foundation to be used for flood relief efforts throughout North Dakota and $50,000 for the Minot Area Community Foundation from Wells Fargo Bank, N.A., and Wells Fargo Environmental Affairs to be used for flooding clean-up efforts in Minot. Ulteig also donated $10,000 to the 2011 Flood Relief Fund established by the North Dakota Community Foundation. Ulteig CEO Eric Michel pledged continued service to the communities and counties as they begin the recovery process. Those are just three companies that have supported those who are being impacted by flooding, and I am sure there are many, many more that I am not aware of. It is not necessarily about how much money is being donated by these companies, it is the fact that when things get tough everyone does their part to help those in need. And that is what makes this part of the world special!
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701.232.8893 Grand Forks/Fargo/Moorhead/northwestern MN
800.641.0683 Bismarck-Mandan/ west central ND/western SD 701.232.8893 Fargo/Moorhead/eastern ND/western MN/eastern SD
EDITOR: Alan Van Ormer Editorial Advisors:
701.232.8893 avanormer@prairiebizmag.com
Dwaine Chapel, Executive Director, Lake Area Improvement Corporation; Bruce Gjovig, Director, Center for Innovation; Lisa Gulland-Nelson, Communications Coordinator, Greater Fargo Moorhead EDC; Dave Haan, Director of Public Relations and Digital Development at Lawrence & Schiller; Dusty Johnson, Chief of Staff for South Dakota Gov. Dennis Daugaard’s office; Brekka Kramer, General Manager of Odney; Matthew Mohr, President/CEO, Dacotah Paper Company; Nancy Straw, President, West Central Initiative Prairie Business magazine is published monthly by the Grand Forks Herald and Forum Communications Company with offices at 808 3rd Ave. S., Ste. 400, Fargo, ND 58103. Qualifying subscriptions are available free of charge. Back issue quantities are limited and subject to availability ($2/copy prepaid). The opinions of writers featured in Prairie Business are their own. Unsolicited manuscripts, photographs, artwork are encouraged but will not be returned without a self-addressed, stamped envelope.
Subscription requests: Free subscriptions are available online to qualified requestors at www.prairiebizmag.com.
Address corrections: Prairie Business magazine PO Box 6008 Grand Forks, ND 58206-6008 bbohlman@gfherald.com
Online: www.prairiebizmag.com 6 Prairie Business
August 2011
Professional Spotlight
Work place experience helps Autism facility become a reality he founder of the North Dakota Autism Center (NDAC) in Fargo, ND has used valuable experience from working at both Great Plains Software and now, Microsoft in Fargo, to help her get through the ins and outs of developing a non-profit business. Sandy Smith, 50, who started the NDAC, in part because her son has autism, credits business skills learned at her work place through training, learning on the job, and having access to great managers and mentors. This environment helped fuel her core values. “My biggest core value is accomplishment. I like to set a goal and go after it,” Smith says. “It took courage, but I knew I had the skills needed from my background at Great Plains and Microsoft.” At Microsoft, Smith is a Business Manager in Technical Support. She is responsible for budgeting, resource planning, reporting and analyzing, and operational review. In September, Smith will have worked 23 years at Great Plains Software, which later became Microsoft. In addition, Smith spends time as the volunteer
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SANDY SMITH Founder North Dakota Autism Center
Executive Director at the NDAC. The inspiration for the Center is her nine-year-old son, Tyler, who in 2003, was diagnosed with an Autism Spectrum Disorder. While searching for services for Tyler, Sandy and her family realized how few options there were for families affected by autism. When Tyler’s needs surpassed what the family and typical daycares could provide, Smith decided to start the NDAC to help Tyler and others at the same time. Smith has always felt drawn to helping people, especially children, and believes this facility is one of her biggest accomplishments. “I had a high school teacher who was very inspirational and encouraging to me,” she says. “He gave me the inspiration that I can go out and do great things.” Smith also credits what she has learned throughout her business career in helping make the Center a reality. “This has really impacted us,” Smith states. “It really inspires me to see the kids and families we are helping.”
PB Alan Van Ormer - avanormer@prairiebizmag.com
Business Advice
Re-engineered, re-invigorated, or replaced?
Over the past decade a lot of business consultants were selling business re-engineering. Although a catchy phrase, upon close inspection successful businesses over time have continuously employed these practices.
usiness cycles and new inventions create losers and winners, business changes also create winners and losers. When long standing businesses are evaluated, most will show distinct changes in their business model over time. Looking at the history of business in the United States will demonstrate a successful enterprise significantly changes who, how, or what they sold about every decade. A really fun example of a business transition timeline was created by Corwin Automotive group in Fargo when they built their new Toyota showroom. Looking over the Corwin legacy will inspire most entrepreneurs and although the automotive industry has huge ups and downs, Corwin had some advantages as well as opportunities, the story board is compelling and a great example of perpetual business reinvention. Alerus Financial is a great example of a business which
B
8 Prairie Business
August 2011
MATTHEW D. MOHR mmohr@dacotahpaper.com.
has thrived through good times and bad with much of their success attributable to leadership and a commitment to successful change. Founded in 1879 as the Bank of Grand Forks, Alerus has grown to become a $9.65 billion publicly traded financial service company through acquisitions, new product offerings, fierce competition, and quality service. Taking on the challenge of new products, customers, business practices, or even locations are huge tasks, but each of these challenges properly met will determine the ultimate success or failure of the enterprise over time. Many of these decisions are made by the entrepreneur’s intuition or “gut feel” for the business. New products, new markets, new customer segments and different business models need to be embraced over time for business continuity, not one time “re-engineering.”
PB
Prairie News
Press releases and photos about business news and events in North Dakota, South Dakota and western Minnesota can be e-mailed to avanormer@prairiebizmag.com for consideration
LAKE AREA TECH RANKED AS TOP 10 PERCENT IN COUNTRY
OBERMILLER NELSON ENGINEERING OPENS NEW BRANCH OFFICE
The Aspen Institute College Excellence Program has ranked Lake Area Technical Institute, Watertown, SD, as one of the nation’s 120 best community colleges, challenging them to compete for $1 million in prize funds (to be announced in December 2011) by insisting on high standards for learning, college completion without delay, and serving as a training ground for jobs that pay competitive wages. Lake Area Tech and 119 other community colleges will be narrowed down to eight-to-ten finalists in September based on how much students learn, how many complete their programs on time, and how well students do in the job market after graduating. The colleges are now eligible to submit applications containing detailed data on these criteria. They must demonstrate that they deliver exceptional student results, use data to drive decisions, and use that information to continually improve over time.
Obermiller Nelson Engineering, Inc. (ONE) opened a new branch office in Alexandria, MN. Cody Ellingson, P.E, project engineer, will be the office manager for the Alexandria location. Obermiller Nelson Engineering, Inc. (ONE) provides detailed mechanical and electrical building design and coordination. With licensed Mechanical Engineers, Electrical Engineers, Fire Protection Engineers (FPE), LEED Accredited Professionals and Commissioning Services Professionals, ONE provides consulting engineering services to clients. ONE is headquartered in Fargo, ND, with branch offices in Grand Forks, ND, and Alexandria. ONE has completed over 4,000 projects in the upper Midwest.
SANFORD, DETROIT LAKES GROWING TOGETHER A new expanded clinic with Same Day Surgery is open for patients in Detroit Lakes, MN. The Sanford Health Same Day Surgery Center has two surgical suites and one endoscopy (pushes a tube-like instrument into the body to look inside) suite. The expanded clinic opened its doors in June and Same Day Surgery opened in July. This is the first part of a four-phase, $15 million, expansion and renovation to bring expanded services to the Detroit Lakes area. The completion of all four phases is slated for November of this year. When all four phases are complete the full expansion and remodel will include 33,800 square feet added to the existing 25,800 square feet including Surgery Center with two operating suites, expanded imaging space and services, expanded lab services, expanded physical therapy space, outdoor space for mobile medical units, and expanded clinic space for future growth of up to 36 providers, both primary and specialty care.
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MORE THAN $1.7 MILLION FOR NORTH DAKOTA AIRPORTS Two airports in North Dakota will receive grants totaling more than $1.7 million for expansion and improvements. Williston - Sloulin Field International Airport, Williston, ND, will receive $700,000 to create a master plan, while Bismarck Municipal Airport, Bismarck, ND, will receive $1,049,320 to rehabilitate the taxiway, expand and rehabilitate the apron, and conduct an Environmental Assessment. The grants were awarded by the U.S. Department of Transportation with funds appropriated by Congress.
NORTH DAKOTA UNIVERSITIES RECEIVE $800,000 IN NURSING GRANTS North Dakota State University and University of North Dakota will receive more than $800,000 in federal grants to promote advanced nursing education and to increase diversity in nursing programs. North Dakota State University, Fargo, ND, will receive an Advanced Education Nursing Grant for $311,349, while the University of North Dakota, Grand Forks, ND, will receive a Nursing Workforce Diversity grant for $515,631. The grants were awarded by the U.S. Department of Health and Human Services with funds appropriated by Congress.
INTEGRA PLASTICS BUILDS NEW PLANT IN BRANDON, SD Integra Plastics is expanding its South Dakota operations with a new 48,000 square foot plant now under construction in the Corson Development Park. The company, incorporated in Madison in 1991, plans to hire 14 new employees for the Brandon facility during the first year and expects the work force in Madison to grow by another 20 jobs as a result of the new construction. Integra Plastics also operates a production facility in Grand Forks, ND. The Brandon project has been part of the company’s master plan for about seven years. Brandon was chosen as the site of the new plant because of its transportation access via a rail spur and nearby Interstate highways. Integra Plastics expects to occupy the new Brandon plant late this year and be in full production by January, 2012.
Lincoln and Minnehaha County EDA Executive Director, Jeff Eckhoff and Brandon Economic Development Director Dennis Olson at the Integra Plastics building site
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11
Prairie News
Press releases and photos about business news and events in North Dakota, South Dakota and western Minnesota can be e-mailed to avanormer@prairiebizmag.com for consideration
STATE BANK & TRUST RECOGNIZED AMONG MINNESOTA'S TOP 100 WORKPLACES
Midcontinent Communications has launched MidcoNet Xstream® Wideband Internet service to deliver unprecedented speed and capacity to their more than 250,000 residential customers. The service offers up to 100 Mbps downloads and 15 Mbps uploads – speeds unmatched in the three-state area Midcontinent serves. ESPN3.com was also added to Midcontinent's service as part of the upgrade. Technology upgrades translate into download speeds of up to 100 Mbps in an area where 3 Mbps is the average. The network's low latency enhances gaming, VPN connections and movie streaming for customers. Faster upload speeds move online activities, such as stock trading and video conferencing closer to real-time. Increased upload speeds also decrease wait times for online file storage and photo uploading. Current Midcontinent customers will automatically be upgraded to the substantially increased speeds, allowing them to access information faster with reduced lag time. For instance, MidcoNet Xstream® Wideband 3.0 delivers two times faster download speeds and three times faster upload speeds than MidcoNet Ultimate Broadband, previously Midcontinent's highest level of service.
Fargo, N.D.-based State Bank & Trust has been named one of the Top 100 Workplaces in Minnesota by the Minneapolis Star Tribune. Top Workplaces recognizes the most progressive companies in Minnesota based on employee opinions about company leadership, communication, career opportunities, workplace environment, managerial skills, pay and benefits. More than 60,500 employees from more than 1,200 companies shared their views in employee surveys collected by Workplace Dynamics, an independent company specializing in employee engagement and retention. Workplace Dynamics surveyed State Bank & Trust's approximately 100 employees at its Minnesota bank locations in Moorhead, Audubon, Detroit Lakes, Pelican Rapids, Fergus Falls and Alexandria. State Bank & Trust also has 170 employees at its Bell Mortgage Division, based in Minneapolis.
TRINITY HEALTH BREAKS GROUND ON WILLISTON CLINIC
NEXT GENERATION INTERNET SERVICE DOUBLES SPEEDS FOR MIDCONTINENT CUSTOMERS
U OF M, CROOKSTON ONLINE BUSINESS DEGREE EARNS TOP FIVE RANKING FROM THE BEST COLLEGES
Trinity Health has broken ground on a new 60,000 square foot specialty clinic in Williston, ND. Through the American Recovery and Reinvestment Act (Recovery Act), USDA Rural Development financed the project with a $5.5 million loan. The new facility will be a three-story medical office building that will replace two existing clinics – Trinity Community Clinic-Western Dakota and Trinity Regional Eyecare. The current facilities lack adequate space, handicap accessibility, and the capability to keep up with new technology. By consolidating the clinics into one centralized location, Trinity Health will be able to efficiently handle the increase in patient volume while providing better health care, lower costs, and improved energy savings. When completed, the clinic will meet the needs of an aging population, as well as the demand for services due to increased activity in the oil industry. The clinic space will consist of offices, consultation space, and 40 exam rooms with an additional area allocated for testing, nurse and technician work stations and general supplies. A retail vision center, radiology, laboratory services, and special procedure rooms will also be included in the building.
12 Prairie Business
August 2011
The University of Minnesota, Crookston’s online degree in business management has been ranked among The Best Colleges list of “Top 10 Online Bachelor of Business Administration Degree Programs of 2011.” The U of M, Crookston’s bachelor of science degree in business management was ranked at number five. Other top ranked online business programs on the list include those offered by UMass Amherst’s Isenberg School of Business; Penn State; University of Illinois at Springfield; Drexel University; and Washington State University. To view the full listing, go to www.thebestcolleges.org/toponline-bachelor-business-admin. An online college search resource based in San Antonio, TX, The Best Colleges reviews publicly available data and produces independent ranking assessments of colleges in various disciplines. The organization’s rankings are based on public data evaluated according to several criteria, including reputation, accreditation, student satisfaction, and cost. The Best Colleges does not accept paid placements for school rankings.
NISC RANKED #1 IN CAREER DEVELOPMENT National Information Solutions Cooperative (NISC) has, for the 10th time, been listed by IDG’s Computerworld magazine as one of the 100 best workplaces for IT professionals in the United States. This year, NISC, Mandan, ND, ranked first in career development and 15th overall. In addition to NISC's overall and career development rankings, the Computerworld report also rated NISC as fifth for employee retention, sixth for training, and third for small companies. The profile summary listed on Computerworld’s website highlights additional benefits NISC offers, including the technology loan program as well as the evaluation and incentive programs.
Prairie People
Please e-mail photos and press release announcements of hirings, promotions, awards and distinctions received by business leaders in North Dakota, South Dakota and western Minnesota to avanormer@prairiebizmag.com for consideration.
CONCORDIA’S 11TH PRESIDENT BEGINS DUTIES
DR. WILLIAM CRAFT
Dr. William Craft started his duties as the 11th president of Concordia College, Moorhead, MN in July. Craft has served as Vice President for Academic Affairs and Dean of the College at Luther College, Decorah, IA, since 2000. He previously worked for 20 years at Mount Saint Mary’s College in Maryland as an English professor, including several years as Chair of the department. During his final four years at Mount St. Mary’s, he also served as Dean of Undergraduate Studies. A graduate of Westminster College (Pennsylvania), Craft earned his master’s and doctorate degrees in English from the University of North Carolina at Chapel Hill. His scholarly publications are on English Renaissance literature, and his involvement in numerous associations and boards has included national presentations on curriculum development, faculty workload, learning assessment, and fundraising.
SANFORD PHYSICIAN BOARD CERTIFIED IN NEUROCRITICAL CARE
LARRY BURRIS
Larry Burris, DO, Sanford Health, has achieved board certification in Neurocritical Care (NCC). He is the only board certified neuro-intensivist in the Dakotas. In addition to NCC, Dr. Burris is boarded in internal medicine, hypertension, nephrology and is the director of NCC at Sanford USD Medical Center. The Sanford Neurocritical Care Program began in 2009 and has cared for more than 460 critical ill patients. It is part of the neurosurgery and neurology service line that provides comprehensive critical care to patients with critical neurologic conditions. It’s a discipline that provides critical care for patients with a wide range of neurological disorders, including stroke, subarachnoid hemorrhage, brain trauma, intracranial hemorrhage, subdural hematomas, seizures, spinal cord trauma, status epilepticus, and encephalitis.
SANFORD RESEARCH/USD ANNOUNCES NEW PRESIDENT
DR. H. EUGENE HOYME
Sanford Research/USD has selected one of its own physician scientists, H. Eugene Hoyme, MD, as its newest president. Dr. Hoyme will guide the current and future direction of Sanford’s growing research activities. He replaces Ben Perryman, PhD, who recently retired after leading Sanford Research for the last decade. Hoyme’s background includes educator, administrator, physician, and researcher. He returned to South Dakota in 2007 and has since served as chief medical officer of Sanford Children’s Hospital, senior vice president for Children’s Services, and professor and chair of the Department of Pediatrics, Sanford School of Medicine at the University of South Dakota. Prior to 2007, Dr. Hoyme served as professor and chief of the Division of Medical Genetics and Associate Chair of the Department of Pediatrics at Stanford University School of Medicine in Palo Alto, CA.
WIDSETH SMITH NOLTING NAMES NEW DIRECTOR OF ELECTRICAL ENGINEERING
BRIAN HINTON
14 Prairie Business
August 2011
Brian Hinton, PE, has joined Widseth Smith Nolting as Director of Electrical Engineering. Hinton is responsible for the design of various building projects in the industrial, educational, medical, and commercial markets, as well as the public sector, including all facets of electrical engineering. Hinton’s responsibilities also include scheduling, budgeting, and managing projects and personnel through final construction completion. Hinton has more than 20 years of experience in the commercial power industry. He received a Bachelor of Science in Electrical Engineering from the University of Nebraska and pursued post-graduate studies in power electronics at the University of Minnesota.
Let’s turn positive signs into positive results. The economy seems to be getting back KATHRYN R.L. RAND
DR. DENISE KORNIEWICZ
on track. Let’s take those positive signs and build on them. Seize new
UND ANNOUNCES TWO NEW DEANS: LAW AND NURSING Kathryn R.L. Rand started in July as Dean of the University of North Dakota (Grand Forks, ND) School of Law and Dr. Denise Korniewicz started in August Dean of the UND College of Nursing. Rand becomes the 16th Dean to serve during UND Law School’s 112-year history and is the first woman to serve in the permanent position. Rand succeeds Paul LeBel, who served as Dean before becoming Provost. Korniewicz will leave her position as Senior Associate Dean for Research and Professor at the University of Miami School of Nursing and Health Studies. Korniewicz succeeds Dr. Chandice Covington. Dr. Julie Anderson has been serving as Interim Dean since summer of 2009.
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August 2011
Livestock income creeping back up into the black Despite the numerous challenges facing livestock producers today, their net farm income is creeping back into the black. A recent report shows 2010 brought a bit of a rebound from the low profits of 2009, according to Minnesota State Colleges and Universities and the University of Minnesota. Among 2,500 Minnesota farms, net farm income was up by $33,417 in 2010. ale Nordquist, Extension Service economist, says in 2009 hog producers lost quite a bit of money and dairy hit rock bottom, but 2010 brought them back to break even. “What we’re really stressing lately because agriculture has become so risky, is that farmers need to put themselves in a position where there is more working capital on their balance sheet so they have something to fall back on in tough times,” Nordquist adds. It helps if livestock producers choose to raise crops as well, and combat some of the high feed prices.
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“There is a tremendous amount of optimism in crop production,” Nordquist states. “This is a great period, although there is a concern with high land prices and that makes it difficult for a young farmer to get established.” Julie Ellingson is Executive Vice President of the Stockman’s Association in North Dakota, but a beef cattle producer as well. She says while the combination of high feed, land and fuel costs are challenges, perhaps her biggest battle has been with Mother Nature. “It’s been a major challenge with extreme
cold and then continued wet and cold later in the season,” Ellingson explains. She adds while beef cattle have seen rebounding prices, the number of cattle hasn’t been this low in North Dakota since the 1950s. Since 2007 the number continues to decline each year. Drought conditions in 2008 brought a mass herd reduction. With crop prices soaring, farmers also tend to eliminate some cattle so they can use the land for crop production. Ellingson adds that an aging demographic is adding to the drop, too. “It’s hard work, labor intensive…so as they age, they opt to remove their livestock enterprise. Plus dealing with cattle in these harsh winters is difficult,” Ellingson states. But she sees great opportunities ahead with a focus on going global. By offering specialty cuts as exports, livestock producers can add more value to each animal. In South Dakota, cattle and calves are a big commodity, with cash receipts at $500 million more in 2010 versus 2009. “As countries have more income, a greater population, and want to provide better quality food for their citizens, they bid for products,” says Steve Noyes, Deputy Director of the South Dakota National Agricultural Statistics Service Field Office. He adds milk, cattle and hog prices all went up in South Dakota, too. But hog prices are very cyclical and often rise and fall dramatically. One key to the bottom line for any farmer is their management ability. Noyes says sometimes in order to most effectively market their commodities, they need to seek some help. “Farmers are very good producers and can produce no problem. But the key is how they market their product,” Noyes states. “It’s not always easy; it’s different than what they normally do and they may not have a lot of experience with it.” The University of Minnesota Extension offers educational programs to teach producers how to maintain and interpret business records, execute marketing plans and develop annual business analyses. “Some producers are looking for that help because sometimes it’s nice to have somebody to bounce ideas off of,” Nordquist explains. “With new trends and advances in technology, producers need to keep up and it really pays dividends for those that do,” Noyes says. PB Maxine Herr is a Bismarck, ND-based freelance writer. She can be reached at maxine606@msn.com. prairiebizmag.com
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Company Spotlight
Kraus-Anderson Construction Company
In the Kraus-Anderson Construction company’s office in Bemidji, MN, 50 percent of the work deals with health care (Photos courtesy of Kraus-Anderson Construction)
Attention to detail sparks Kraus-Anderson Construction It is customary for employees at Kraus-Anderson Construction Company in Bemidji, MN to measure twice and cut once when out on a job site. hat attention to detail has now become an attitude for the company. “It is all about a willingness to go the extra mile and the dedication of doing what it takes to get the job done,” states Jeff Iisakka, Vice President, Director of Operations. In the last five years, the company has grossed more than $4 billion in construction contracts. In 2010 alone, the Kraus-Anderson Construction Company signed $721.5 million in contracts. This was occurring when other construction companies were either merging or closing all together. Kraus-Anderson Construction restructured its business model to become more efficient and streamline allowing it to remain a stable company. The model has worked. Between 2007 and 2008 the company had $1 billion in sales. In 2009, that decreased to $500 million. In 2010, it increased to $721.5 million. Founded in 1897 and privately owned and managed by the Engelsma family for more than 70 years KrausAnderson Construction is consistently ranked by Engineering News Record among the top 50 general
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Jeff Iisakka Vice President Director of Operations
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August 2011
contractors in the United States. Bob Fitzgerald, Director of Business Development, directly correlates the success to a corporate culture where employees have passion, enthusiasm, and loyalty to the owners and clients. In addition, Fitzgerald believes the success is because of the quality, as well as craftsmanship, of the final project. “We have a quality management system that pushes our team to follow certain protocol,” Iisakka says. Along with Bemidji, Kraus-Anderson Construction has locations in downtown Minneapolis, Circle Pines, MN, and Duluth, MN, as well as Madison, WI, Kansas City, KS, and Phoenix, AZ. Currently, the company has more than 80 projects in process totaling more than $820 million. Kraus-Anderson Construction operates in 15 different market sectors around the country. Iisakka and Fitzgerald state that Kraus-Anderson is considered the number one construction company in Minnesota and number 12 dealing with K-12 education projects and number nine in health care work in the nation. It is estimated that roughly
50 percent of the company’s work in the Bemidji area deals with health care. Kraus-Anderson Construction also does many municipal and city projects, as well as the hospitality and lodging industry, corporate market (office space), and retail. The company has also become more active in the southwest and is one of Cabela’s main contractors. Kraus-Anderson Construction has completed more than 30 projects with Cabela’s, including new stores, as well as store renovations and additions. “We feel we tailor and customize our team based on the clients’ needs,” Fitzgerald says. Fitzgerald says that because of the company’s structure Kraus-Anderson Construction offers its clients the best of two worlds. “We have the community spirit of a regional contractor and the resources of a national construction leader,” he states. Kraus-Anderson Construction has been able to buck one trend of a tough economy over the last few years. The building construction business was one of the hardest hit businesses in the country. “It has taken its toll,” Iisakka says. “A lot of companies have closed their doors.” Iisakka says the economy has made people wiser and more frugal in finding ways to do construction more economically. “Money is so tight right now,” he says. “Money is either not available or people choose to be selective of where money goes. Pricing is very competitive. There are so many bidders.” Another trend that has changed construction is technology. Iisakka says shared data can be placed on FTP sites to provide construction partners a better overall picture of a project and share information. Fitzgerald adds technology is changing the way construction companies do business. “It provides more timely responses between project team members and also provides greater efficiencies,” he states. “It is still a people business. Those relationships are vital. Technology cannot replace ability to work together.” Another trend is that as a larger contractor, KrausAnderson Construction is able to expand out more in the region, as well as the country. “We try to be more selective with the projects we want to pursue,” Iisakka states. “We select projects to pursue that best fit our forte and give us the best chance for success.” Fitzgerald adds that the biggest opportunity for Kraus-Anderson Construction is to continue to improve efficiencies through technology. In addition, the health care market continues to be important to Kraus-Anderson Construction. “The health care market landscape has changed,” Fitzgerald adds. “There are many facilities either merging or aligning themselves with systems. To them that means more sustainability. We’re also going to see serviceline opportunities.” PB Alan Van Ormer - avanormer@prairiebizmag.com
KRAUS-ANDERSON CONSTRUCTION COMPANY COO AL GERHARDT:
Cabela’s
What the construction industry could look like in five years and how the industry needs to adjust WHAT WILL THE CONSTRUCTION INDUSTRY LOOK LIKE IN 5 YEARS?
Minot State University
KA is well-positioned to address what we see as continued demand in several markets. Health care construction will continue to be a dynamic area. Senior housing will remain active, as our aging population of healthy, vibrant seniors drives new developments. We also believe we’ll see continued investment in K-12 and higher education, as critical to providing an educated citizenry and a competitive workforce. Also the sustainability and energy conservation movement will continue to work its way into the infrastructure, through new construction, renovations and redevelopment.
HOW MUST THE CONSTRUCTION INDUSTRY ADJUST TO WHAT THE INDUSTRY WILL LOOK LIKE IN FIVE YEARS? Sanford Center
Bob Fitzgerald Director of Business Development
Our industry has in recent years embraced a number of new technologies, such as Virtual Design Construction, which enables us to plan more effectively during preconstruction and improves our efficiency in the construction phase. As the pace of technological advancements continues to accelerate, it’s our continuing challenge to analyze emerging technologies and quickly determine when and where they apply a true benefit to our clients. Another challenge is to foster the next generation of construction professionals. As veteran superintendents, carpenters, and craftsmen approach retirement, we need to enroll young talent in training to replenish our talent force. Especially after the past 2 or 3 years of recessionary constraints, we must be proactive in communicating to students that construction is a viable industry. KA’s participation in the Bemidji State University scholarship program, our participation in the ACE Mentor Program and our support of other training initiatives are part of our response to that need. prairiebizmag.com
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Leadership/Management
Creating a culture of excellence with great service DR. DAVID KAPASKA Regional President/ CEO Avera McKennan Hospital & University Health Center, Sioux Falls, SD Dave.kapaska@avera.org
In virtually any business or industry, there’s simply no getting around it: Excellent customer service is vital. ou may provide the highest quality product or service around, but if customers aren’t treated well, they likely won’t be back. The jaw-dropping fact of the matter is, if we don’t have repeat customers, most of us won’t stay in business. At Avera McKennan, we call it “Service Excellence.” The simple word of “Always” is our catch phrase. We expect each and every staff to do the right thing for every patient, every time. Customer service is not just the receptionist’s job. It’s as far-reaching as to those who answer the phones or clean rooms, to company leaders that customers might encounter, to those who provide the actual service that customers are paying for. We have a set of CARE Standards which are expectations for each and every employee. These general principles apply to any business that has dealings with the public. So I’ll share a brief synopsis of these standards with you:
Y
C AR E C is for Communication: Excellent communication happens not only with words, but with tone of voice and body language. It’s keeping individuals informed, and explaining things carefully without technical jargon. It’s listening attentively without interrupting. Great communication begins with staff members introducing themselves to the customer if it’s a first encounter, and explaining their role – all with a smile.
A is for Attitude: A great attitude is reflected in treating each individual with the utmost care, courtesy, patience, respect and dignity. It’s displaying a gracious manner and a welcoming presence. It’s treating each individual as the most important person. A customeroriented staff member not only meets expectations, but goes the “extra mile” and exceeds expectations!
R is for Responsiveness: We’ve probably all experienced those frustrating moments at a “customer service” counter where we wait and wait without any acknowledgement. Obviously, this is a tremendous dissatisfier. Responsiveness in a nutshell is timely follow-up and follow-through. It’s responding to needs quickly, and even anticipating needs in advance. It’s offering a “blameless apology” when things go wrong, and doing whatever you can to fix the problem right away.
E is for Engagement: This is taking ownership of each situation – not assuming that it’s “someone else’s job.” Engagement is finding innovative solutions, not just relying on “what we’ve always done.” And, engagement is collaborating as a team to provide the best possible service. In today’s economy, none of us can afford to lose business due to uncaring, nonresponsive, or downright grumpy staff. Excellent service is the right thing to do, and it can help ensure that your customers don’t even think about going anywhere else.
In today’s economy, none of us can afford to lose business due to uncaring, non-responsive, or downright grumpy staff. Excellent service is the right thing to do, and it can help ensure that your customers don’t even think about going anywhere else. 20 Prairie Business
August 2011
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LEEDing the W Way ay JLG congratulates North Dakota State College of Science for their first LEED® Certified building.
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prairiebizmag.com
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Technology
Choosing technology for a positive ROI T The role of technology in business is to make significant contributions to the bottom-line. Disagreement on data sets or mis-trust of data can often be attributed to the challenges with disparate systems. What if you could consolidate your islands of data to work effectively together?
JULIE WEST President/COO WennSoft Fargo, ND jwest@wennsoft.com
he decision to rationalize disparate systems or combine different operating systems comes down to the return on investment. There may be less upfront cost in just adding a piece to your technology environment, but it may be outweighed by the daily overhead of additional resources and energy spent comparing or combining different sets of data to get the insight into what’s really happening in your business operations. If your organization is ready to evaluate and invest in an operational system, here are a few key considerations to keep in mind: Include long-term growth plans in scoping your solution. Often companies purchase software for today’s requirements and find that they’re back in a search sooner than expected because growth wasn’t part of the initial scope.
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Make safe bets. Purchasing software from vendors with a history of success, strong customer references, and on a technology platform you feel comfortable will be around for several years is critical.
Access to information is key. To continually increase your competitiveness you need to be able to react to market conditions. That requires a solution that can provide information at any point in time – leading and lagging business indicators. Identifying those requirements up front ensures you have the information you’ll need to make sure your technology really does contribute to the bottom line. Consider your end users. New solutions should be easily adopted by your employees – the navigation should be intuitive and the support end users receive should be easily accessible when they need it.
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Have the right team in place to get the work done. You’ll need internal advocates to help your company through the transition, and likely a technology partner or two to ensure your environment and solution are deployed and maintained as designed.
Once you merge several disparate systems into a single integrated view, you’ll find your company has “one version of the truth” - a single set of data that can support the decisions made by individuals across your organization. The result should be better served customers, more informed employees, better business decision making, and a solid return on the technology investment.
ON THIS DATE
AUGUST 1, 1990 The creation of what would become the World Wide Web was suggested by Tim Berners-Lee and Robert Cailliau at CERN, the European Laboratory for Particle Physics at Switzerland. By October, they had designed a prototype Web browser. They also introduced HTML (Hypertext Markup Language) and the URL (Universal Resource Locator.) 22 Prairie Business
August 2011
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23
HIGHER ED
COVER STORY
Collaborating is good for the work force Secondary institutions are joining together to develop curriculum and share space, but in the end it is still about educating and developing a sufficient work force for the region’s business industry. ollaboration in higher education is important because resolving the issues we face will require more than one institution or even one higher education system can do on its own,” states Scott Thiss, Chair of the Board of Trustees of the Minnesota State Colleges and Universities. “We must work together to better prepare high school students to go to college, to increase the number of college graduates, and to provide retraining for working adults who need to upgrade their skills and abilities – all to better meet employers’ needs. States in the Midwest must be able to compete in the global marketplace to maintain the high quality of life that we have here.” North Dakota University System Vice Chancellor for Academic and Student Affairs Michel Hillman believes that it is important to find the best way to serve students. “Many times that comes down to collaboration because collaborative programs can be put together more quickly, are less expensive, and provide geographic access, which is important to students,” he says.
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AT THE CORE OF UNIVERSITY CENTER’S SERVICE MODEL Mark Lee, Executive Dean of the University Center in Sioux Falls, SD, says collaboration is at the core of UC’s service
Mark Lee, Dean, University Center in Sioux Falls
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August 2011
model. “Collaboration allows us to be very efficient in our course offerings,” Lee says. “Students are taking courses from two or three different universities and it allows for seamless transfer of credits.” Collaboration also allows for a breadth of degree offerings. Lee explains that University Center has the ability to draw programs from partner universities that each has unique missions. The impact also is shown in various ways. “South Dakota’s public higher education system continues to see significant growth,” Lee says. “Students see value in what we are doing in Sioux Falls.” It also brings different perspectives from multiple presidents in the university system. In addition, collaboration provides recognition and allows the community to learn more about each university. “It is good for Sioux Falls because we have a growing work force and this allows us the flexibility to meet the educational demands of our growing economy,” Lee says. The collaborations that have been developed also allow the University Center and others in the region to grow delivery models. Lee explains that the trend of online delivery is also
Scott Thiss, Chair of the Board of Trustees, Minnesota State Colleges and Universities
Michel Hillman, Vice Chancellor for Academic and Student Affairs, North Dakota University System
Ulteig is proud to support the North Dakota Community Foundation and the 2011 Flood Relief Fund.
Please give today and join us in assisting our neighbors in the flood affected areas of North Dakota.
www.ndcf.net/flood 888-858-3441 www.ulteig.com
Where’s your
beyond?
Success these days demands being ready for anything. That’s why Bismarck State College has emerged as a leader for educational innovation – a community college with a global reach. Online and in the classroom, BSC gives you choices beyond other colleges. Pursue a degree in our technical programs and you can be working in a good job in two years or less. Or if you plan to get a bachelor’s degree, start with BSC’s liberal arts transfer programs – then move beyond to a world of four-year college majors. You can even get your bachelor’s degree on the BSC campus in partnership with Dickinson State University, Minot State University or the University of North Dakota. You choose your beyond. BSC will help you get there.
beyond
prairiebizmag.com
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HIGHER ED
COVER STORY increasing. “We need to be as efficient in our delivery system as possible and we need to reach as many people as possible,” he says. “By pooling resources and efforts we can accomplish that.”
EAST-WEST DEVELOPING ENGINEERING PROGRAM North Dakota State University, in Fargo, ND, and Dickinson State University, in Dickinson, ND, has partnered to create a pre-engineering program in western North Dakota. This would allow students at Dickinson State University to take preparatory courses and then transfer those courses to the programs at NDSU, as well as the University of North Dakota in Grand Forks, ND. To date, there are 24 students in the program at NDSU and 20 students participating at Dickinson State University. The engineering program allows students to begin their studies in Dickinson and complete them at NDSU in either computer engineering, electrical engineering, industrial engineering, or manufacturing engineering. NDSU College of Engineering and Architecture Dean
Gary Smith says there is a need for highly skilled engineers throughout the area, especially for designed-based companies in western North Dakota. “Students are looking for opportunities in the state,” he states. “It has been constant and growing nationally that employers are looking for more talented engineers.” Like other university collaborations, this one would enable students to stay closer to home. “This makes education more affordable for students,” Smith states. “In addition, students are able to start in a local program before going on to a school of their choice.” The hope is that the two schools working together will allow students in pre-engineering to connect with local companies who need those types of services. “They can start doing internships and practical experience at local companies,” states Dr. Paul Johanson, Chair of the Mathematics and Computer Sciences Department at Dickinson State University. “By doing internships, businesses would continue to attract those people. Companies are hoping to get a better selection of engineers for their companies.
COLLABORATION COVERING A 19-COUNTY AREA In Minnesota, a recommendation is being discussed that encourages Southwest Minnesota State University in Marshall, MN, and Minnesota West Community and Technical College to offer more applied academic programs to help attract and retain a skilled and educated work force in the 19-county region around Marshall, as well as generate more economic initiatives. The Minnesota West Community and Technical College has campuses in Jackson, Worthington, Pipestone, Canby, and Granite Falls. The two institutions would expand articulation agreements that would allow more students at Minnesota West Community and Technology College to transfer credits and complete a four-year degree. Melinda Voss, Public Relations Director, Minnesota State Colleges and Universities System, says one reason collaborations are important in the higher education system is because it allows for more efficient resource use. “In addition, collaborations often generate better ideas and better approaches and help give every stakeholder group an opportunity to contribute and to be a part of what’s created next to move things forward,” she explains. “To keep moving that needle we need to attract, retain, and graduate more students. We need more college graduates to help keep Minnesota’s work force competitive in a global marketplace.”
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August 2011
RECEIVING INPUT FROM OTHERS North Dakota established a Higher Education Roundtable in 1999 that directed the university system to serve student and employer needs. “We have one of the most responsive systems in the nation,” Hillman states. “We’re able to move quickly when the need is justified.” The labor market in North Dakota is dynamic and changes quickly, Hillman adds. “Employers are looking for well-educated, adaptable employees,” he explains. “Through collaboration and development in distance education students can stay in their home towns and earn degrees. We are able to respond to those needs.” Thiss agrees collaboration has become a key component in educating future workforces by increasingly working with business and industry and fostering connections among the 31 Minnesota State Colleges and Universities. “We want to prepare graduates who can step in to a job and perform as needed.” In 2009, the top leadership of the Minnesota State Colleges and Universities system interviewed leaders of about 350 companies around the state to find out what they needed. This was the first time that the university system collectively had assessed what skills and attributes that business and industry wanted in graduates. The system also has four Centers of Excellence in health care, engineering and manufacturing, and information technology and security. The Centers involve 22 colleges and universities. Collectively, the Centers work with local K-12 partners to encourage students to take rigorous high school courses and to consider preparing for careers in the respective fields. These Centers each have a business advisory board to recommend curricula and programs that produce graduates who can perform well on the job with increasingly complex skills. “The connections will generate more opportunities and better programming. We hope business and industry will offer more internships to our students, for their own self interests,” Thiss states. “Often, internships provide an inside track to a good job in any number of different fields. Employers get a chance to “test drive” a potential hire and students do valuable work while soaking up experience in their chosen career.” PB Alan Van Ormer avanormer@prairiebizmag.com
prairiebizmag.com
27
REAL ESTATE
COVER STORY
Fargo, Bismarck expected to see continued commercial growth An online publication has listed Fargo, ND, and Bismarck, ND as two of 10 real estate markets to watch throughout 2011.
nman News listed Fargo number six and Bismarck number nine in the list that was released earlier this year. Kyle Holwagner, Commercial Broker Associate for Daniel Companies in Bismarck, believes the two communities will continue to see steady and predictable growth. “At the current time inventory of commercial and industrial properties in western North Dakota is limited,” he states. “With the demand high and the supply low, this will allow developers and investors who are seeking opportunities to invest in strong communities like Bismarck and Fargo. The commercial development in the next five-to-seven years will be dynamic.” Lance Ziebarth, President-Construction for Roers Construction, says although the construction industry was particularly hard hit throughout the country be recession, Fargo and Bismarck experienced a slowdown, but were still fair markets supported mostly by public building projects. “What we are seeing now is some strength in the market due to private companies filling some pent up need for new facilities or expansions,” Ziebarth comments. “We also do not see the vacancies in the retail and commercial markets that are seen in most of the rest of the country. Thus the real estate market is seeing the same surge.” Matthew Durbin, an agent with Konrad Olson Commercial Real Estate in Fargo, ND, says primary sector job growth will be the biggest factor impacting commercial development. “I don’t foresee a big increase in commercial building in 2011 and 2012,” he says. “Fargo still has plenty of vacant commercial space to absorb before we see large scale commercial development like we did in the early 2000s.” Inman News examined housing, economic, and demographic data for metropolitan areas nationwide in compiling a list of 10 housing
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Fargo, ND laundry building (Photo courtesy of Konrad Olson, Commercial Real Estate)
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August 2011
markets that are showing signs of strength and may outperform other housing markets in 2011 in several key metrics. To compile the list, Inman News considered markets with low unemployment rates, high median sales price growth, growth in the number of building permits issued, and a rise in in-migration from other states. It also considered population growth, projected job growth, affordability, low foreclosure activity, median household income growth, fewer average days on market for for-sale properties, and growth in occupied housing units. In its assessment of Fargo and Bismarck, the online publication sites North Dakota benefiting from the oil boom in the western part of the state. In addition, it assesses that the Fargo market is home to several oil, agricultural, medical and technology companies, including Microsoft, that provide ready jobs for graduating students. As for Bismarck, along with enjoying one of the countries lowest unemployment rates, Bismarck received the highest job-growth projection from Moody’s Analytics of the 10 markets. The economic analysis and forecasting company predicted a 3.3 percent job growth in Bismarck between the third quarter of 2010 and the third quarter of 2011, compared with 1.9 percent nationally. There is a correlation between real estate market and commercial building. “The correlation is based on employment and population growth and demand,” Holwagner explains. “More people, more jobs, more opportunities. The opportunities in the areas of commercial and industry growth like agriculture, energy, and petroleum will continue to expand and are mostly based on new technology. The natural resources of North Dakota and technology will drive the real estate market including commercial development.” The Bismarck-Mandan market area is experiencing growth and demand in several areas including medical space, hotel and restaurant development, light commercial, and industrial space. “With the population growth there will also be the need for new schools, medical facilities, and public infrastructure,” Holwagner adds. In Fargo, Ziebarth says the community is already seeing some resurgence in the commercial real estate market. “I think our North Dakota conservative nature kept the retail and commercial markets from being overbuilt as much as they were in the rest of the country, so we think we will continue to see strengthening,” Ziebarth states. “We all know what a diversified economy we have here, and with medical and technology companies committed to growth in our community, and the agricultural and industrial businesses thriving, the demand created by those industries and spin-off retailers and office clients will continue to push our economy.” Overall, Durbin believes vacancies will continue to decrease as the market slowly begins to absorb the existing inventory. “As employers experience job growth, I expect to see a couple of new office and industrial facilities under construction in 2012.” PB Alan Van Ormer - avanormer@prairiebizmag.com
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CONSTRUCTION
COVER STORY
32 Prairie Business
Construction industry adjusting to change The construction industry has seen changes over the past few years and companies throughout the region are adjusting to the changes. verall, Russ Hansen, Executive Vice President of the Associated General Contractors of North Dakota, says North Dakota is fortunate to be one of the only states with a favorable economy which has afforded increases in construction expenditure to build and maintain various forms of infrastructure. “North Dakota will have a record setting investment in highway construction during the 2011-13 biennium. Much of the resources are going to address the wear and tear on our road infrastructure due to increased truck traffic in both the agricultural and oil related activities,” he says. “While most other states are seeing decreases in construction activities, North Dakota’s activity in this area is on the rise. And that’s a key component to a sound economy- having good road, bridges, water systems, and commercial construction.” But despite the overall good fortune, there are concerns in the construction industry.
O
August 2011
Dan Kadrmas, President of Rommesmo Companies in Fargo, ND, who is also President of the Central Fabricators Association, is not aware of any fabricators in the association making a profit in the construction sector. “The only fabricators who made a profit were diversified in other industries.” Then there is the competitive nature of the construction industry. There are usually four bidders for projects, but last year Kadrmas explains he was seeing as many as 15-20 bidders for any one project. “The number of bidders is still high,” he says. Pricing is also extremely competitive. Brian Jans, Vice President of Jans Corporation in Sioux Falls, SD, says that in the last two years the numbers have been “ridiculously” low. “We’re doing work below cost,” he states. “The financing part has changed. In part, this is happening because many in the private sector have to find new funding mechanisms for projects.” Jans believes this has impacted the construction industry because it means more paperwork. “Everything has to be documented,” he states. “This creates more overhead. We are doing as much work in the office to build a building as we are on site.” Between 2005 and 2008 there was big ramp up in activity. Now the challenge is too much capacity with too little demand. In addition, credit is more difficult to obtain for construction projects, which results in delays and cancellation of project awards, Kadrmas states. “There has been a slight improvement in construction and credit in 2011.” In addition, the construction business lags behind other economic sectors. “The normal economy was down in 2007,” Kadrmas says. “Construction didn’t see that until 2009. Now our recession is lasting longer than the general recession.” Rommesco Companies handled the recession by changing its business model. The company replaced 30 percent of its construction fabrication revenue with manufacturing products in 2011. Another concern is the bid letting process itself.
Construction projects are bid on two ways – either by a builder’s exchange or negotiated market. Kadrmas states that the process has not changed, but the pricing has changed. “Pricing has become tighter,” he states. “The negotiated work is more competitively bid in the current market.” What this is doing in Kadrmas’ opinion is shaking the industry up with consolidation and companies exiting the market. In the steel fabric side, which Kadrmas is familiar with, there has been labor reductions in the steel fabrication construction market ranging from 40 percent to 60 percent. In addition, between 2006 and 2008, it was normal to do 500 to 1,000 ton projects. Today, most companies will do any size project. Obermiller Nelson Engineering (ONE), headquartered in Fargo, ND, recently opened an office in Alexandria, MN. The mechanical and electrical building design company has noticed that there is a huge push for Green buildings in western Minnesota. In addition, budgets are much tighter and there seems to be more of a team effort. “All are getting on board during the design phase,” states Jeremiah Christenson, Managing Principal for ONE. “Contractors are involved upfront and that helps them understand what the owners want.” Work in the St. Cloud area is busy, but in central Minnesota, Christenson is not seeing much activity. “Minnesota does not have the funds right now and large projects aren’t being constructed,” he explains. Christenson has noticed, not only in western Minnesota, but also across the nation that guaranteed maximum pricing is becoming popular. However, like other construction companies, ONE has seen a decrease in the time for the bidding process. “This makes it harder to provide the same amount of quality as before,” Christenson states. “That’s a big challenge for everyone.” PB Alan Van Ormer - avanormer@prairiebizmag.com
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Community Spotlight
Sioux Falls, SD
Sites around Sioux Falls, SD (Photos courtesy of Sioux Falls Area Chamber of Commerce)
Becoming a national player It was 25 years ago, in 1987, when Sioux Falls, SD launched its first Forward Sioux Falls campaign to help with economic growth in South Dakota’s largest city. or more than two decades, Forward Sioux Falls has been considered the primary economic engine in Sioux Falls. As Sioux Falls has expanded significantly over those years, the impact has become regional, states Craig Glogowski, Senior Vice President for National Community Development Services based in Atlanta, GA. Glogowski is the Campaign Director for the current Forward Sioux Falls fundraising campaign. “Forward Sioux Falls has a powerful program of work,” Glogowski says. “The magic of a five-year program gives a community a hard stop to re-examine what’s working and remake the program if necessary based on changing conditions. What breathes life into the program is the city’s business and local governmental leadership.” Forward Sioux Falls is the joint venture economic development program of the Sioux Falls Area Chamber of Commerce and the Sioux Falls Development Foundation. Slater Barr, President of the Sioux Falls Development Foundation, says improving the community’s economy involves quality of life, higher education, the ability to attract employees, and creating infrastructure. “It all ties together in holistic fashion,” he explains. “Our goal is to continue this community’s development in population, wealth, and prosperity.” As in previous Forward Sioux Falls program, Sioux Falls is again marketing itself on the regional and national levels, but plans to do so in a focused and specific way. Forward Sioux Falls has indentified four industry sectors
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Craig Glogowski Campaign Director Forward Sioux Falls
Michael Bender Chair, Board of Directors Sioux Falls Area Chamber of Commerce
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to focus on in 2011-2016. They include corporate and data services, scientific medical research and services, renewable energy technologies, and warehousing and distribution. Michael Bender, Chair of the Board of Directors of the Chamber, says Sioux Falls is no longer competing with the other communities in the state but with other regional cities for economic development projects. “We need to really emphasize a unified marketing plan,” he states. “The idea is not to take a step back when it comes to marketing our community to the nation.”
SIOUX FALLS ALWAYS HAS BEEN TOP-NOTCH BUSINESS COMMUNITY Evan Nolte, who is the President and CEO of the Sioux Falls Area Chamber of Commerce, has been associated with the Chamber since 1980. “We have always been a good business community, but we weren’t very well diversified,” he states, referring to the decades prior to Citibank’s arrival in Sioux Falls in 1981. The diversification started after the financial services industry came to South Dakota. “The business and professional community in the state embraced it,” Nolte remembers. Then the first Forward Sioux Falls was launched in the late 1980s and was the catalyst leading to increased economic growth in jobs, capital investment, and quality of life projects. Dana Dykhouse, CEO of First Premier Bank, says the
Community Spotlight
Sioux Falls, SD
overriding goal is to create jobs and the city wants to create as many as 10,000 new jobs by 2016. “We want to keep growing at a steady pace,” he states. “Many new jobs will come in the targeted areas.”
IS SIOUX FALLS AT A CROSSROADS? “People are pumped up about Sioux Falls right now,” Sioux Falls Mayor Mike Huether states. “People in South Dakota are getting enthused about what is going on in Sioux Falls. We are a major piece of a big economic engine for the state. People are counting on us and we’re not going to let them down.” Glogowski says there are many changes afoot. An example is the financial services sector. “It has served Sioux Falls well and is still a strong component,” he says. “Moving forward we need to identify what the next industry sector is to help Sioux Falls grow.” Dykhouse adds that a stable economy has benefitted Sioux Falls. “We have avoided the boom and bust and the bubble (housing and real estate issues,)” Dykhouse states. “Agriculture is the largest generator of state products and it is very healthy now. It creates opportunities.”
Brian Jans Vice President Jans Corporation
Mike Huether Sioux Falls Mayor
CHALLENGES ARE STILL ON THE HORIZON Brian Jans, Vice President of Jans Corporation, says it is challenging competing with the current national economic situation. “We know that there are still problems across the country that will impact us,” he states. “For example, if banks can’t loan like before it will make it more difficult.” Another challenge in Sioux Falls is moving forward with a proposed new Events Center. The project’s planning process led by Mayor Huether’s administration is now being considered by the Sioux Falls City Council and may go to a public vote later this year. Lincoln and Minnehaha County Economic Development Associations Executive Director Jeff Eckhoff states there are still a large inventory of homes in the Sioux Falls area. “People are getting more comfortable with the employment situation,” he says. “We should see homes moving as the overall economy improves.” One challenge that Dykhouse sees is in his own backyard: financial services. “There have been tremendous restrictions of financial services with federal action curtailing that business making it difficult to manage,” he says, adding that the state has lost as many as 5,000 jobs and is estimated to lose another 4,000 to 5,000 jobs in the future. Bender agrees that the financial services sector is a challenge because it has been so successful in providing jobs and a high quality of life. He adds that workforce development is also an important trend. “We’re at 4 ½ percent, but we are used to 2 percent,” he says. “In the next 10-15 years, we will see a lower unemployment rate.”
Evan Nolte President/CEO Sioux Falls Chamber of Commerce
Dr. Pamela Homan Superintendent Sioux Falls School District
TRENDS THAT ARE SHAPING THE COMMUNITY Huether says the most exciting trend is that people are buying again and choosing Sioux Falls as the place to spend their money. Then there is what he calls repairing, rebuilding, and replacing the community’s infrastructure. “We have to 36 Prairie Business
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Slater Barr President, Sioux Falls Development Foundation
take care of our infrastructure,” Huether says. “Once our base is strong, then we can reach for even greater heights” Jans says that a trend he sees is strengthening and building back. He gives the example of the Sioux Falls Greater Area Chamber of Commerce seeing growth in its membership in the past few years. In addition, companies are changing business models and are smarter in how they do business, Jans adds. “We need to focus on the areas that we lack,” he says, adding that includes technology and research. Eckhoff sees manufacturing starting to come back stronger. “That means demand for goods is up,” he says. “However, the building sector is still down from previous years.” Eckhoff is also seeing companies in Lincoln and Minnehaha counties expanding in the last two years their current ag portion of their business to meet the increased demand in that area. Another trend is the evolution into major health care systems, something that Dykhouse believes Avera Health and Sanford Health have been able to capitalize on, bringing high quality health care, jobs, and capital investment to the region. Then there is the fact that people who have made money in South Dakota are learning to reinvest in the state. “That is a big plus for us,” Dykhouse says. There is also the focus on higher education and K-12 education, which helps the community improve its education level for the workplace. Dr. Pamela Homan, Superintendent of the Sioux Falls School District, says the educational system works closely with the business community by providing a work force that has the skill sets needed to work after graduation. This includes not just K-12, but the Career Technical Academy and Southeast Technical Institute, as well as the other higher education facilities within the city. “We want to educate and prepare each student to succeed in a changing world,” she says. “They won’t succeed in the world today if they don’t continue their education. We want our graduates to go out and compete in the world.” The downtown area also weathered the recession well. There is low vacancy in buildings and there is continued investments in restoring, upgrading, and remodeling. Jennifer Schmidtbauer, Vice President of Downtown Sioux Falls, says there is strong demand for residential housing and she expects to see more apartments being built in the future. “We are seeing trends nationwide of renting instead of purchasing,” she states. In addition, Schmidtbauer says small businesses are relocating downtown because the lease rent is lower. “There is a real eye on expanding on all corners of downtown,” she explains. Barr concludes that the job opportunities that have been created makes Sioux Falls a major business destination. “If you look at our tax structure, you start looking at sustainable locations in the United States where you can grow and thrive for the next couple of decades,” he says. “This tax structure has increasing relevance in the future. A lot of it is about connecting to individuals and organizations in the community.” PB Alan Van Ormer - avanormer@prairiebizmag.com
At U.S. Bank, we are committed to supporting the Dakotas. It’s where we work and where we live. We’re also dedicated to being your local financial partner with the strength, support and service you deserve. Imagine what you can do when you have the power of US working for you. U.S. Bank is one of America’s strongest banks. Our strengths have never been more aligned with the needs of our communities, and our stability makes us even more qualified to serve you. As our nation recovers, we will use that strength to make our communities stronger too. We are well capitalized, open for business, and poised to do what we’ve been doing since 1863 – making sure the financial dreams of every U.S. Bank customer take flight with a bank that is safe, strong and ready to work for you. Visit or call a U.S. Bank branch today! Delton Steele Regional President Fargo, ND 701-280-3553
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Sales/Marketing
Businesses wrestling with benefits of social media On a daily basis, my inbox is filled with online offers, gimmicks, and other promotional techniques spawned by the digital age. s a business leader, you've probably wrestled with how your organization can benefit from search engine optimization, Facebook, Twitter, LinkedIn, blogs, and other online opportunities. So, what's the right answer? In fact, there is no single correct answer. The right combination of online tools is different for every business. So before you expand—or, God forbid, overextend—your marketing budget in order to enter the digital frontier, take a good look at your foundational marketing efforts. Your current marketing plan requires a consistent long term commitment to spreading your message.
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LINN HODGSON Account Manager Ad Monkeys Grand Forks, ND linn@admonkeys.com
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Measurable results don’t happen overnight. Rather, they develop over months, years, even decades. Most brick and mortar businesses were built at least in part through proven traditional media: print, radio, television, outdoor. Today, all of these still deliver the goods when used correctly. So before slashing them to make room for online options, ask yourself: Do I have enough frequency to effectively tell my story? Is my message passive or invasive? Am I advertising with enough consistency to move my prospect through the 5 Steps of Communication (Unawareness, Awareness, Comprehension, Conviction and finally Action)? Now take a look at your message. Does it speak to the prospect? Does it resonate with the customer? Does it include a specific emotional or logical link to the prospect? Is the message all about your business, or can the customer see themselves using your products or services? Does the message dramatize your company’s unique products or capabilities? Does your message cut through the clutter of more than 7,000 daily messages? Only after inspecting, improving and measuring the effectiveness of your foundational marketing, should you consider your digital options. In doing so, remember that feeling you get when your inbox is overloaded with online offers. If you're like me, it can be annoying. The last thing you want is for your online efforts to fall into that category. Remember, most of the suggestions included above apply to social options as well foundational marketing. Successful social campaigns mandate frequent updates, a commitment to consistency, content that resonates with the customer... and yes, messages that demonstrate your company’s unique abilities. Consistency. Frequency. Quality of message. Here's hoping all three find their way into your marketing foundation and social media plans. PB
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The right products for the job
Bremer expands Farm Management Services remer Trust, a division of Bremer Financial Services, announces the expansion of its Farm Management Services business to serve clients across the Red River Valley in North Dakota and Minnesota. Part of that expansion includes the hire of Chris Griffin as a farm manager and trust officer. Griffin has a wide range of experience growing up on a farm, working as an attorney and serving as a state representative in North Dakota. The team also includes John Botsford and LeeIla Drees in Grand Forks, and is supported by an eight person local Bremer Investment Management & Trust team. Bremer launched Farm Management Services in May 2009 in the Red River Valley. The business includes all aspects of supporting clients to maintain land ownership due to a retirement, health issues or inheritance and to provide complete management services for investors or other absentee landowners. Bremer services clients in more than 20 of its communities in both North Dakota and Minnesota. “We have experienced tremendous success and growth since launching this business two years ago and are excited to expand our services further into North Dakota and Minnesota,” said Mark Schmiel, president of Bremer Trust. “We also look forward to welcoming Chris on board, who will be a great addition to our already strong team working with clients on everything from land ownership to health issues.” Bremer’s Farm Management Services specifically assists clients with: finding a quality renter for the farmer’s land (and strive to secure fair market value rent), ensuring the renter uses proper farming practices to maintain or improve land productivity, conducting farm inspections, monitoring participation in and compliance with applicable government programs and providing accounting services and distributing net income. PB
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SAFETY
Safety in the oil fields is also about business
With the boom in the oil fields in western North Dakota, companies are making safety even more of a priority; not only from a safety standpoint, but also from the business aspect. hose companies that maintain excellent safety records have an easier time attracting and retaining a qualified and professional work force,” says Tim Michelsen, Vice President – Administration, Treasurer, and Chief Accounting Officer at WBI Holdings, Inc. He carries the responsibility for safety administration for the company’s pipeline and energy services operations. “As a contractor, if you don’t have a good safety record, others will not hire you.” Terry Kovacevish, Bakken Asset Manager for Marathon Oil Company, has been part of the Bakken development the past five years. He says companies are continuously evaluating their safety programs. “What I have seen is a greater awareness of the safety aspects and improvements in safety programs, policies, and training,” he states. In addition, Kovacevish notes that the experience level of the work force dictates how much on-site safety supervision is needed. “Many companies have very well qualified safety advisors or technicians working in the field, improving procedures, and monitoring work activities,” he explains. “We have many new people coming to North Dakota to work in our industry, some with experience and others with limited experience. We all are striving to make sure training requirements are being met before any employee is allowed out in the field to work.” Kari Cutting, Vice President of the North Dakota Petroleum Council, states that everyone knows that there is a significant cost to industry for employee injury. “These costs are realized in WSI premiums, health insurance costs, loss of employee productivity, as well as the more intangible costs involved in emotional cost of co-workers being injured, and public relations,” she explains. “Industry recognizes that prevention is the best way to avoid these costs. “The next three to five years will see continued growth, development, and further progress in the Bakken,” Cutting adds. “Nearly $4 billion will be invested in oil and gas pipelines, rail facilities, and natural gas processing plants, all of which will reduce truck traffic for moving product from the well sites.” In addition, $1 billion of infrastructure improvements was approved for western North Dakota by the North
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TIM MICHELSEN Vice President Administration, Treasurer, Chief Accounting Officer WBI Holdings, Inc
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Dakota Legislature. “The combination of state and industry expenditures combine to make the Bakken possibly the largest development and construction project in the United States right now and likely the second largest in North America, behind the Alberta oil sands,” Cutting says. For each new well drilled, approximately 1,200 truckloads of equipment and supplies are needed during the drilling phase and an additional 800 truckloads of product are hauled during the first year of production. With 2,000 new wells expected in 2011 that equates to 4 million trucks across roads in western North Dakota, Cutting says. “Safety is priority number one for the industry. The industry is continuously working to improve safety,” Cutting explains. “Motor vehicle crashes are currently the biggest concern and we are working together with the state and other partners to improve roadway safety.” Kovacevish agrees that at Marathon Oil Company safety is a core value. “We feel very strongly that if you plan, assess risk, communicate, and execute work safely, you will have successful business results,” he states. “We continually challenge ourselves to continuous improvement with the end result being a safe, clean, secure, and responsible operation.” He adds that a strong safety program is good business. “It builds a positive reputation with our stakeholders and it is the right thing to do,” he says. “Hopefully, everyone will carry the same safety awareness and commitment when they are home with their families.” In an effort to help with safety issues, the North Dakota Petroleum Council has brought together industry representatives to serve on a safety committee. The safety committee provides a resource of technical knowledge and expertise to analyze safety related issues and provide ideas and solutions. This year the safety committee is addressing three main safety topics: road safety, underground utility management, and well site safety management. The North Dakota Petroleum Council is stressing safety and training of workers and contractors, supporting more resources in western communities for infrastructure
and advocating for state agencies to increase regulation and enforcement. “We can all do our part by using safe driving practices, being patient, slowing down, and planning more time for our travel,” Cutting adds. In addition, in cooperation with the North Dakota Department of Transportation, the North Dakota Petroleum Council is starting a road safety campaign entitled “ProgressZone.” The campaign will use billboards and other media to send a strong, safer traffic message. “We are making progress, but when road construction begins, all of us need to be patient and more aware of the conditions around us,” Cutting says. “The ND DOT has stated that most accidents occur when drivers are impaired, distracted, or driving too fast for the road conditions.” Cami Gilbertson is President of Compliance & Safety Services, Inc., a company located in Fargo, ND, that specializes in federal motor carrier safety regulations. “The work done out there and the safety record is amazing to me,” Gilbertson says. She states that because of what is happening in the oil fields of western North Dakota, safety issues have become more challenging. “Because of the demand, drivers without experience are being hired,” she says. “One of the issues involves how long drivers can be on the road and be safe.” Companies are now stepping up and implementing good safety programs to operate safely and continue to do business, Gilbertson states. “Prior to the boom, North Dakota was good at doing what it had to do,” she adds. “Now having to implement safety programs, they see it as an investment that protects their bottom line, instead of a huge expense. That is the way companies thought about it in the past.” Gilbertson notes that companies do not need to reinvent the wheel. “There are regulations for everything that gives companies guidance on how to do things,” she states. “Companies can use the regulations for guidance and customize a program that works for them.” Michelsen states that when the pace quickens in any sort of industrial activity, safety needs to be a priority. “I don’t believe the safety aspects have changed,” he says. “When pace quickens, you need to continue to make employees aware of all the hazards.” He also believes that when safety becomes ingrained in an organization’s culture, it becomes part of the operating procedure rather than a mandatory after-thought. “I’m seeing more of an emphasis lately to create this culture of safety in organizations. This just makes a whole lot of sense.” There continue to be challenges with safety issues in the oil field. Michelsen says that in safety, the pace of work is always a challenge. “Said another way, when it gets busy – maybe some safety issues are overlooked in favor of just getting something done. There can be no shortcuts to working safely,” he explains. “When you establish a culture in the organization that values worker safety above everything else, then you have taken a big step towards creating a self-sustaining safe work environment.” Michelsen believes that establishing and maintaining a culture in the organization that values work safety as the standard way of operations is the key. “Safety is about making employees aware of the hazards and being prepared to work around them,” he explains. “But we all know that working safely comes down to personal choices; employees must have the desire to not get hurt.” PB Alan Van Ormer - avanormer@prairiebizmag.com prairiebizmag.com
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Campuses uncover savings in alternative energy
McCrory Gardens Education and Visitors Center, SDSU (Photo courtesy of Perspective)
Picture the vast amounts of energy required to operate a college campus – maintaining acres of grounds, heating and cooling dozens of buildings, and providing water for each of its residents can make the meters spin.
Americans used renewable energy sources — water (hydroelectric), geothermal, wind, sun (solar), and biomass — to meet about 8% of total energy needs in 2009. Source: U.S. Energy Information Administration
Gorecki Alumni Center, UND (Photo courtesy of JLG Architects)
any universities across our region are focusing on alternatives and efficiency to meet the dual goals of cost-savings and a “greener” approach. “Most campuses are involved in some form or another in looking at energy efficiencies,” says Sally Grans, System Director for Facilities Planning for the Minnesota State Colleges and Universities System. And with 27 million square feet of academic and residential life facilities across 54 campuses in Minnesota, a statewide push for energy efficiency adds up quickly to make a big difference. Grans cites examples of energy-related projects across the western part of the state: a wind turbine is already installed at Minnesota West Community Technical College in Canby, and additional turbines are being put in place at the Wadena and Fergus Falls campuses, as well as at Metropolitan State University in the Twin Cities; geothermal energy powers a building on the Wadena campus housing the electrical lineworker technician program; and one of the buildings on the Central Lakes Staples campus is heated by a corn burner, appropriate since the school has a number of programs involving ethanol. “It is a smart thing to save energy,” Grans comments. “It is common sense for any facility of any magnitude to find a way to reduce energy cost.” From 2009 to 2010, Grans notes that there were significant savings on a number of campuses – some as much as 10 percent from the previous year. In 2009 the Minnesota higher education system spent $33.2 million, while in 2010 that number decreased to $32.8 million. “When we started doing an analysis of campuses, we found out they were inordinately high. However, they have
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gone down 8-10 percent in actual consumption,” Grans states. These cost savings are important in a period of tight economies and budgets. “Every dime saved can go back to the mission purpose to create more dollars for students in a learning environment,” Grans states. “It is the right thing to do for the environment. Part of the reason we are looking at energy alternatives is because we are always concerned about energy shortages.” A South Dakota example also follows this trend of cost-consciousness and an eye toward a more sustainable future. At South Dakota State University in Brookings, the new McCrory Gardens Education and Visitor Center is being built with the color green in mind, a 10,000 squarefoot facility of administrative spaces, classrooms, conference rooms, and a great hall on the east edge of the 65-acre botanical garden. The building’s energy needs will be supplied by geothermal energy, basically tapping into the heat generated by and stored in the Earth. “The ‘green’ aspect is important, but the energy efficiency of it is great,” says Amy Jones, Project Engineer in the SDSU Facilities & Services department. “We have the space to do a ground-source well field here at this site, and there is a willingness on the part of the Gardens to spend the upfront cost associated with it.” Geothermal systems tend to have higher up-front capital costs, but Jones says the cost will be recouped over the lifecycle of the facility. In addition, the building will also have other energy-saving attributes, such as LED lighting, radiant in-floor heat, and an energy recovery ventilator that collects heat and reuses it in the system.
Jones says the energy model done during the building’s design found geothermal to be a 68 percent improvement in annual energy use over a baseline case using electric heat. The modeling shows a total annual energy savings of 34 percent over baseline, taking into account the geothermal heat source plus all of the other conservation measures in the design. In addition to the cost savings, Jones believes the environmental impact should always be part of the equation. “We should make that a priority,” she comments. “Let’s use our resources more wisely, more strategically.” The university hopes to complete construction on the donationfunded building project this fall, opening to the public in early 2012. North Dakota campuses are in the game as well, most notably the University of North Dakota at Grand Forks which was recently listed as one of the country’s “greenest” schools by the Princeton Review’s Guide to 311 Green Colleges. “We’ve been doing a lot of good things on the campus,” comments Larry Zitzow, Director of Facilities Management at UND and Chair of the UND Council on Environmental Stewardship and Sustainability. “It’s been a combination of many different things that have led us down this path.” For one, Zitzow says the UND Energy & Environmental Research Center (EERC) is a world leader in studying coal as an energy source and how to convert it to other fuels. The university is looking at the
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possibility of adding glycerin to coal to improve its BTU value, something Zitzow says they may implement this fall in the campus’ coal plant. In addition, campus-wide initiatives such as changing all fluorescent lighting to more efficient T8 lamps and converting all exterior lights to induction lighting will save thousands of dollars. UND has also installed CO2 sensors in its buildings to know when the air conditioning system needs to turn on, put all bathroom lights on sensors to turn off and on automatically, and converted restroom fixtures to water-saving units. Zitzow points to metering as a key to energy efficiency, noting that UND has installed “smart meters” on several of its 200-plus buildings. On his own computer screen, he can see these buildings’ usage of energy at any given point in a day. “Metering buildings is a huge campaign, so we can look at those meter readings and quantify the usage,” he says. From there, choices can be made on where efficiency improvements are needed. The showcase on the UND campus is the new Gorecki (pronounced go-RETS-key) Alumni Center, a 30,000 square-foot building that will be LEED Platinum Certified, the highest rating available. “To get Platinum is really a major accomplishment, and it’ll be the first and so far only Platinum-rated building in North Dakota,” Zitzow notes. LEED stands for Leadership in Energy and Environmental Design, a
rating system used to distinguish the sustainability of one building when compared to another, developed by the non-profit US Green Building Council. “I am thrilled that, thanks to the generous North Dakota Spirit of our alumni, the first LEED Platinum building in the state — and the first LEED Platinum alumni center in the United States — will be here at the University of North Dakota,” said UND President Robert Kelley in a press statement given at the May 6th groundbreaking. “The Gorecki Alumni Center will be a symbol of UND’s commitment to energy and environmental sustainability, which will mean cost-savings and operational efficiencies for the building over time.” UND says the Alumni Center will likely show a 30 to 40 percent energy savings over traditional buildings, from the more efficient use of water and energy, cleaner interior air, and lower maintenance costs. Zitzow says the building will feature a section of “green roof ” that has plantings on top to keep the building cool. The energy focus is sitewide and not just limited to the building, including the collection and reuse of rain water for irrigation. The namesakes of the Gorecki Alumni Center are Ben and Dorothy Gorecki of Milaca, MN, longtime supporters of UND who have donated $4 million to the project. Completion is expected for Homecoming 2012. PB Kristin Brekke Vandersnick is a Willow Lake, SD-based freelance writer. She can be reached at brekkefarm@gmail.com.
MIDWEST ENERGY EMISSIONS CORPORATION AND EERC LAUNCH COMMERCIAL APPLICATION OF NEW MERCURY CONTROL TECHNOLOGY he Energy & Environmental Research Center (EERC) at the University of North Dakota announced that a major corporate partner, Midwest Energy Emissions Corporation (ME2C), a research-oriented mercury emission capture company based in Grand Forks, ND, is launching a new mercury control system. The sorbent enhancement additive (SEATM) injection technology originally developed by the EERC is being installed at a major power utility on the West Coast and will be commissioned this fall. “Our mission is to deliver leading-edge, cost-effective solutions for mercury emission control in utility boilers around the world,” said John F. Norris, Jr., ME2C CEO, who recently visited ME2C’s research facilities at the EERC to review performance data developed for the initial West Coast utility client. “We are extremely pleased to have a proven mercury control technology that effectively reduces mercury emissions over a broad range of plant configurations and coal types,” said Norris. ME2C is licensing an EERC-developed technology through the EERC Foundation, a separate, nonprofit corporation that provides the EERC with a dedicated infrastructure to support its commercialization activities. The EERC will provide installation and technical support throughout the commissioning and start-up of the technology, with ongoing assistance as needed to ensure optimal performance. “We are extremely pleased to be working with Midwest Energy Emissions Corporation to provide our implementation and optimization expertise for commercial deployment of this technology,” said EERC Director Gerald Groenewold. “Since the early 1990s, the EERC has been successfully developing, testing, and demonstrating a number of mercury control technologies in partnership with federal agencies, utilities, and coal companies throughout the United States and Canada. This technology is offered as a turnkey solution by ME2C to provide a simple, consistent, and economical solution for mercury removal to the coal-fired utility industry and other industrial units.” “Currently, more than 1100 coal-fired power plants operate in North America, along with
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Students at Minnesota West Community Technical College, Canby campus study wind turbines (Photo courtesy of Minnesota State Colleges & Universities System)
many more large industrial units,” said John Pavlish, EERC Senior Research Advisor and an inventor of the technology. “Numerous mercury regulations are driving the demand for new mercury control systems,” Pavlish said. In the United States, the U.S. Environmental Protection Agency is expected to put new mercury regulations in place in November of this year. In Canada, many provinces are requiring more than 70% mercury reductions. The high cost of replacing or enhancing coal-fired boilers has created strong incentives for utilities to maximize their useful life and identify technologies that will satisfy these regulations without large capital expenditures.
Gerald Groenewold, Director of EERC; John Norris, CEO, Midwest Energy Emissions Corporation, and John Pavlish, EERC Senior Research Advisor. (Photo courtesy of EERC)
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Wind-to-battery project providing insight for renewable energy A wind-to-battery project near Luverne, MN could someday spawn new jobs and new businesses. ut for right now, Xcel Energy is testing the new technology at a site just outside of the Minnesota community, located 30 miles east of Sioux Falls, SD. “If energy storage took off, I’m sure it would create new jobs and businesses,” says Frank Novachek, Director of Corporate Planning for Xcel Energy. Xcel Energy has been testing a one-megawatt batterystorage technology to demonstrate its ability to store wind energy and move it to the electrical grid when needed. “Right now, technology is too expensive to deploy on a large scale.”
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Novachek notes that the battery does provide insights on how companies like Xcel Energy could best integrate high penetrations of renewable energies into a system to provide clean, reliable and, affordable power to customers. Novachek says that the battery can be tested anywhere on the grid and serve a similar function, but Luverne was chosen because it provided Xcel Energy the opportunity to both tie into the Minwind Energy, LLC wind farm directly and into the transmission grid to test multiple battery operating approaches. There is an Xcel Energy switching station about 400 feet away from the substation to the wind farm. “It allowed us to sight the battery on property at a switching station, run cable to their substation, and provide us access to their voltage transformers to get our power on and off the grid,” Novachek states. “Essentially, it saved us investment in transformers and access to the wind farm.” The battery installation is adjacent and connected to Minwind Energy’s 11-megawatt wind farm. The 20 50-kilowatt battery modules combined are the size of two semi trailers and weigh almost 80 tons. They are able to store more than 7 megawatt-hours of electricity, with a charge and discharge capacity of one megawatt. Fully charged, the battery could power 500 homes for more than seven hours. In 2010, Xcel Energy conducted various tests to demonstrate the one-megawatt battery-storage technology’s ability to store wind energy and move it to the electricity grid when needed. Preliminary results indicate the battery has the ability to: Effectively shift wind energy from offpeak to on-peak availability, Reduce the need to compensate for the variability and limited predictability of wind generation resources, Support the transmission grid system by providing voltage support, which contributes
Wind-to-battery project near Luverne, MN (Photo courtesy of Xcel Energy)
to system reliability, and Support regional electricity market by responding to real-time imbalances between generation and load. Results from a second test are expected to be released later this year. Novachek states that these tests will help Xcel Energy understand the battery’s capability, as well as the quick response and service it provides. “We’re using these tests to understand how energy storage can benefit the system, and secondly, how this technology works,” he explains. “One of the reasons this technology was selected was because of certain characteristics that can be attributed to short duration and high powered devices and others that can be attributed to long duration and high energy devices.” The tests show that the battery has a long enough bulk energy storage that allows for significant time shift to capturing curtailed wind during the evening and then being able to store the energy until the system can use it, Novachek states. In June, the Midwest Independent Transmission System Operator (MISO) announced that it will be studying energy storage capabilities. MISO is an Independent System Operator (ISO) and the Regional Transmission Organization (RTO) that provides openaccess transmission service and monitors the high voltage transmission system throughout the Midwest United States and Manitoba, Canada. MISO operates one of the world’s largest realtime energy markets and has 93,600 miles of transmission lines under its direction. “From that, they may be able to develop new tariffs for energy storage devices on the system,” Novachek says. “They have asked us to use our battery to validate some of the models they are developing.” PB Alan Van Ormer - avanormer@prairiebizmag.com
ON THIS DATE
August 27 1859
W.A. ‘Uncle Billy’ Smith discovered oil in a shaft being sunk by Col. E. L. Drake at Titusville in western Pennsylvania. Drilling had reached 69 feet, six inches when Smith saw a dark film floating on the water below the derrick floor. Soon 20 barrels of crude were being pumped each day. prairiebizmag.com
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The Economy
Rapid employment increase hits the Midwest For the first time since quarter one of 2009, the Midwest is experiencing a rapid increase in employment in industries across the board according to a recent survey on employment outlook. s the markets are coming back, the needs for products and services are going up, thus making the need for more people an urgent one in many places. This report is also important considering that in 2008 some industries lost as many as 2,500 employees because of cut backs. Of the industries surveyed for Quarter 1 of 2011, the manufacturing industry (both durable and nondurable goods) has experienced a 36 percent increase in employment, construction 19 percent, and leisure and hospitality a 30 percent increase compared to the same quarter in the previous two years. This rise in employment brings with it a new focus for many companies from all industries – the need for stronger technical, leadership, people and customer service skills. “We have found that the skilled labor force, welders and machinists for instance, are very short staffed and they have a strong need for more employees. This need seems to be climbing every day,” reports Roger Oliver, the Operations Director for the Dakota MEP Fargo Office. The Dakota MEP is a nonprofit organization in the manufacturing industry. Their focus is to provide services and help manufacturing companies grow their people. “The companies we’ve worked with are working hard to find the next step to replenish and provide jobs,” says Oliver. As new jobs are created in this field, employees will find that advanced skill sets and continued skill development will set them apart from their peers. The leisure and hospitality industry is also experiencing rapid growth this year as the Midwest draws many people traveling for business and from Canada for shopping sprees and family gatherings. One of the challenges during this rapid employment growth is to find people that have strong communication, leadership and customer service skills. Hotels, for instance, are finding that their guests are no longer satisfied with just a place to sleep at night. Their clients expect greater value for their
August is considered National Inventor’s Month to educate the American public about the value of creativity and inventiveness and the importance of inventions and inventors to the quality of our lives
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stay and that depends very highly on the service they get from the moment the reservation is made until goodbyes are said upon departure. Many employers find themselves wondering what they can do to become more competitive and stay profitable during this new turn of events. For the manufacturing industry, more robotics and computer techniques is becoming a high priority when considering a new employee; whereas many hotels are shifting their focus to hiring individuals with stronger leadership, people and customer service skills in order to supply the needs of their guests and stay competitive as new hotels are being built. “Ideally I try to find out what values the candidates live by,” expresses Julie Brown, General Manager of the Staybridge Suites in Fargo, ND. The Fargo extended stay hotel has been ranked one of the top 20 hotels in the nation for the Staybridge brand. “Understanding a possible employee’s values helps unveil if they have passion for serving others and if they are dedicated to helping others succeed too,” she explains. Passion, dedication, advanced skill set and strong people skills seem to be the qualities that many companies in all industries are focusing on as they become more innovative with this current increase in employment. These increases and challenges are not unique to just the North Dakota area. Manufacturing industry professionals in Oklahoma have reported the need for up to 75 welders in the next few months and rapid growth is also expected in multiple industries located in areas expanding from Minnesota, Wisconsin and all the way down to Texas. PB Mandy B. Anderson is a Bismarck, ND-based freelance writer. She can be reached at mandy@mandybanderson.com.
Money
Taking your small business online Today, more than ever, small business owners must do more with less – find and serve more customers, produce and sell more products and services, all with fewer resources.
aking use of the online capabilities available through your full-service financial provider can help. Here are a few simple tips to help business owners achieve some of their financial goals.
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GET A FINANCIAL CHECK-UP. Do you have the right type of checking accounts? Are there other services that could increase cash flow, save costs, or retain employees? Talk to an expert – your banker is there to help you succeed financially. Leading banks have full libraries of online tools that can answer your questions about SBA loans, 1031 exchanges, insurance and other benefits of online banking.
you can review your balances and transactions daily. Other services, such as online invoicing and bill payment, require some time up front; however, once established, can impact daily calendars and balance sheets. Cutting the time it takes to pay your bills from 30 minutes to three is great – getting paid five days (or less) after issuing an invoice is even better. These tools and many more are available for you at most full-service financial institutions. Find the solutions, and the financial services provider, that will work best for your particular business and help you accomplish more with less. PB
START TODAY. Managing expenses is critical, and grouping your expenses into categories can show you where your primary operating costs are. Take advantage of free expense management tools offered by most major banks. These tools automatically categorize transactions, giving you a better idea of your spending patterns, trends and budgeting opportunities.
CHECK YOUR CREDIT RATING. As the economy improves, you may want to expand and will need credit to help finance your plans. Now is a good time to make sure your credit rating is in good standing and establish sound practices to keep it that way.
GO “GREEN.”
DAN MURPHY Regional President Wells Fargo North Dakota, South Dakota and Western Minnesota daniel.murphy@wellsfargo .com
Turning off paper statements is environmentally friendly, and it can reduce monthly checking account fees substantially by eliminating the cost of paper checks, envelopes and stamps. It also means fewer paper records in circulation, which can help reduce fraud.
Coldset Web Printing is one of the most economical ways to print, which can save you money and increase your bottom line. Our Web Presses can print your newsletters, catalogs, publications and directories on uncoated stocks – including newsprint.
If you’re looking for ways to cut costs, we can help!
DO IT NOW. Believing that your current process “works just fine” can block you from adopting new, more efficient routines. A good first step is to start banking online, so prairiebizmag.com
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ViewPoint
A Rose by any other name, would be very confusing to customers A successful business depends on customers who can identify your goods from your competition. This is why trademarks are crucial to businesses. he law protects trademark owners by not allowing anyone else to use a confusingly similar mark. Confusingly similar doesn’t mean the same. It’s anything that could cause a consumer to confuse one mark with another. If the typeface looks similar, the words sound similar, or the color is similar the trademark may be confusing and not valid. A trademark can be any word, color, symbol, or even scent used to identify the source of your goods. For example, NIKE makes shoes and their symbol is used to identify the shoes they make from all other shoe manufacturers. Service marks function in essentially the KIARA KRAUS-PARR same manner as a trademark, but instead of identifying the Attorney at Law source of a good it identifies the source of a service. Kraus-Parr Law Office A brand is not a trademark. It distinguishes one good Grand Forks, ND Kiara@krausparrlaw.com from another, but it doesn’t necessarily identify the source of a product. A customer may be aware of a particular brand name, but not know who makes the product they’re
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buying. DR. PEPPER is a well-known brand and a trademark identifying the manufacturer of a soda. When the name is written on a shirt it isn’t necessarily a trademark because it doesn’t identify the source of the good, the shirt. This doesn’t mean it can never be the trademark for a shirt, but simply placing a brand on a product doesn’t create a valid trademark. The two most important aspects of a valid trademark are: it must identify the source of a good and it must be used in commerce. A valid trademark won’t matter if you can’t enforce it, therefore you should register your mark. Registering your trademark creates a larger area of protection. If a trademark is used in commerce without registration it may create common law rights, allowing you to challenge a trademark or its registration. Those rights, however, are limited to the geographic area where your trademark is used, but if you register your trademark federally it is protected nationally. PB
Important to be informed about immigrant benefits Immigration is a hot debate amongst our government leaders. t is important to be informed as to how immigrants benefit North Dakota. Immigrants not only bring demographic and cultural diversity to our state, but they also bring technological and scientific innovation to our state’s universities and businesses as well as provide labor for the state’s agricultural and ranching sectors. Immigrants contribute to the state’s economy and account for millions of dollars in tax revenue and consumer purchasing power. In 2008, 15,013 immigrants lived in North Dakota, comprising around 2.3 percent of the state’s population. From 1990-2008, the Latino population grew by .52 percent and the Asian population grew by .1 percent. In 2010, North Dakota immigrants held $651 million in consumer purchasing power. Immigrant businesses experienced sales and receipts of $123.5 million and employed more than 1,600 people. Immigrant entrepreneurs and consumers provide North Dakota’s economy millions of dollars and jobs. Empirical research has repeatedly shown that both legal and undocumented immigrants create jobs and stimulate our economy through their purchasing power. They start their own businesses and buy goods and services from U.S. businesses such as food, homes, and cars. In 2009, Latino purchasing power in North Dakota totaled $371.6 million
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50 Prairie Business
August 2011
and Asian purchasing power totaled $279.4 million. In 2002, there were 230 Latino-owned businesses that experienced sales and receipts of $15.9 million and employed 210 people and 277 Asian-owned businesses with sales and receipts of $107.6 million and employed 1,466 people. Immigrants provide a positive impact on North Dakota contributing to the state’s economy as workers and taxpayers. In 2008, the Perryman Group reported that “if all unauthorized immigrants were removed from North Dakota, the state would lose $55.1 million in economic activity, $24.5 million in gross state product, and approximately 30 jobs.” New Americans in the Peace Garden State: The Economic Power of Immigrants, Latinos, and Asians in North Dakota, Immigration Policy Center, July 2010. Immigrants contribute to North Dakota’s economy as students and excel educationally. In 2008-2009, foreign students contributed $51.5 million to North Dakota’s SUE SWANSON economy through tuition, housing, and fees. In 2008, half Immigration Attorney of all scientists and engineers in the U.S. with doctoral Swanson Law Office degrees were immigrants, who contributed to the number Grand Forks, ND of inventions and patents filed in the U.S. sue@swansonimmigrationlaw Immigrants provide a positive economic impact on .com North Dakota’s businesses and residents. PB
Economic Development
Campus enhancements vital to the success of Region The North Dakota Legislature recently authorized a $10.3 million general fund appropriation for the expansion and renovation of Rhoades Science Center at Valley City State University. here is a definite “buzz” in the air among students, faculty, staff, alumni, community members, and other friends of the University as this project commences. As the first state-funded major capital project in 40 years at VCSU, this project is creating a kind of excitement that hasn’t been seen in decades. But it isn’t just the added space that is creating excitement. The Rhoades project is specifically linked to recent campus enrollment and programmatic gains in the Sciences and STEM (Science, Technology, Engineering, Mathematics) Education. These gains include new programs in Fisheries & Wildlife, Health Sciences, Technology Education, Exercise Science, a Nursing collaboration with Dakota College at Bottineau, as well as the addition of a new Great Plains STEM Education Center and the new Prairie Waters Education & Research Center. On a college campus, the buildings are a vital part of the learning environment. Particularly in subjects related to the sciences that depend on physical characteristics like well-designed and well-equipped labs, current technology, and proper lighting and ventilation, the degree to which
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STEVEN SHIRLEY President Valley City State University, Valley City, ND stevenshirley@vcsu.edu
the facilities are up-to-date can directly impact the quality of learning. Of course, a major factor for embarking on this project is to meet the region’s growing demands in critical fields. Like many states, North Dakota must increase the number of graduates in the sciences, engineering, and technology, particularly in rapidly growing areas such as health care, energy, information technology, and nursing. Similarly, math and science teachers are also in short supply, and changes in how these subjects are being taught are creating demands for teachers with new kinds of skills. By authorizing these types of projects, a Legislative Body sends a powerful signal of its willingness to invest in meeting these demands. The region’s colleges and universities respond by producing graduates with the necessary knowledge, skills, and abilities. The investments required to fund these projects on campuses help transform the educational experience for the region’s students decades into the future. No doubt, these investments will have a direct positive influence on the region’s ability to compete and be successful in the years ahead. PB
prairiebizmag.com
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August 2011
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By the Numbers EMPLOYMENT
(NOT SEASONALLY ADJUSTED)
May 2010 North Dakota 3.0% Fargo MSA 3.5 Bismarck MSA 2.9 Grand Forks MSA 4.0 Minot MiSA 2.9 Dickinson MiSA .8 Williston MiSA 1.0 Jamestown MiSA 3.1 Wahpeton MiSA 3.2 South Dakota 4.6 Sioux Falls MSA 4.6 Rapid City MSA 4.9 Aberdeen MiSA 3.7 Brookings MiSA 4.1 Watertown MiSA 4.3 Spearfish MiSA 4.7 Mitchell MiSA 4.0 Pierre MiSA 3.4 Yankton MiSA 4.7 Huron MiSA 3.5 Vermillion MiSA 4.2 Minnesota 6.4 Minneapolis-St. Paul MSA 6.3 Brainerd MiSA 8.0 Winona MiSA 5.8 Fergus Falls MiSA 5.8 Red Wing MiSA 5.9 Willmar MiSA 5.4 Bemidji MiSA 8.2 Alexandria MiSA 5.7 Hutchinson MiSA 7.5 Marshall MiSA 5.0 Worthington MiSA 4.7 Fairmont MiSA 6.0
EMPLOYMENT
May 2009 3.5% 3.8 3.4 4.1 3.1 2.4 1.7 3.6 4.1 4.7 4.8 5.1 3.7 4.1 4.5 4.6 4.1 3.4 5.0 3.6 4.2 6.9 6.9 8.2 6.5 6.2 6.7 5.6 7.8 6.0 8.6 4.9 4.8 6.6
May 2010 May 2009 364,575 359,779 113,593 116,018 59,447 60,359 53,662 52,565 32,620 33,127 16,484 14,944 21,229 16,620 10,962 11,578 13,505 11,721 429,690 425,750 124,330 123,450 62,875 63,835 23,045 22,675 18,405 18,255 18,015 18,010 12,985 13,000 12,725 12,530 12,255 12,170 11,430 11,385 9,670 9,500 7,490 7,400 2,785,958 2,762,181 1,729,079 1,713,859 44,653 44,780 27,375 27,337 29,639 29,388 24,512 24,343 23,184 23,151 20,340 20,053 19,191 19,625 18,852 18,384 14,480 14,316 11,203 11,308 11,024 11,159
MSA — Metropolitan Statistical Area MiSA — Micropolitan Statistical Area Sources: U.S. Bureau of Labor Statistics, Minnesota Department of Employment and Economic Development, Job Service North Dakota, South Dakota Department of Labor
MINNESOTA
Intl. Falls-Rainer Grand Portage Baudette Warroad Roseau
TRUCKS
MAY 2011
% CHANGE /MAY 2010
MAY 2011
% CHANGE /MAY 2010
43,374 28,105 16,747 13,296 3,782
10.84% 27.58 3.95 8.08 8.83
1,846 1,436 712 1,427 760
-16.88% 9.79 6.43 47.72 20.25
21,838 9,639 4,930 5,372 4,427 3,607
-17.93 7.40 13.80 11.15 35.88 18.89
17,729 8,386 687 2,965 947 760
0.17 9.84 0.00 -0.34 -6.97 -64.74
NORTH DAKOTA
Pembina Portal Neche Dunseith Walhalla Noonan
Source: US Customs and Border Protection
54 Prairie Business
August 2011
Sweet Crude Price/BBL
Production Oil-BBL/day
$103.91 $78.19 $79.10 $71.26
360,279 348,400 344,100 284,300
APR 2011 FEB 2011 DEC 2010 APR 2010
Drilling Permits 125 155 134 106
APR 2011 FEB 2011 DEC 2010 APR 2010
May Rig Count
175
Producing Wells 5,536 5,324 5,331 4,810
Rig Count 173 167 163 107
All Time High Rig Count
178
Source: NDIC
State Colorado Montana Wyoming SD New Mex ND
This Week
Last Month Week Ago
69 10 45 1 85 159
71 10 41 0 78 161
Year Ago
72 10 42 0 75 162
53 6 37 1 63 99
Source: Reported by Baker Hughes. Pub in RMOJ
MAY AIRLINE BOARDINGS BOARDINGS
Minneapolis-St. Paul Fargo Sioux Falls Rapid City Bismarck Duluth Grand Forks Minot Pierre
CANADIAN BORDER CROSSINGS AUTOMOBILES
NORTH DAKOTA OIL ACTIVITY
Oil Rig Count
UNEMPLOYMENT RATE
% CHANGE/2010-2011
2,693,647 26,450 33,746 21,413 15,339 11,422 8,868 11,725 1,965
04.14 -11.73 16.50 -13.70 -00.92 -04.45 02.38 75.89 11.81
Source: US Customs and Border Protection
CANADIAN EXCHANGE RATE 06/29/10
05/30/11
06/29/11
U.S. to Canadian Dollar
$1.05 or $0.9498
$0.98 or $1.0241
$0.97 or $1.0304
U.S. to Euro
$ 0.82 or $1.2185
$0.70 or $1.4269
$0.69 or $1.4427
U.S. to Chinese Yuan
$6.80 or $0.1471
$6.48 or $0.1542
$6.46 or $0.1548
U.S. to Japanese Yen
$88.40 or $0.0113
$80.97 or $0.0124
$80.81 or $0.0124
U.S. to Mexican Peso
$12.84 or $0.0779
$11.61 or $0.0861
$11.77 or $0.0850
Source: Bank of Canada
Data provided by Kingsbury Applied Economics
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The LEED® Green Building Rating System TM is the national benchmark for design, construction and operation of highperformance “green” buildings. It promotes a whole-building approach to sustainability. Visit the U.S. Green Building Council’s Web site at www.usgbc.org to learn more about LEED rankings and standards. Rendering courtesy of JLG Architects Ltd., Grand Forks.
The College of Education and Human Development is proud to have worked on the project with these North Dakota businesses: JLG Architects AE2S Engineering
A new day is dawning for the College of Education and Human Development at The University of North Dakota. The 2011 fall semester will find the College occupying a fully renovated and expanded Education Building that is setting standards for merging energy efficiency with environmental protection.
LEED Silver means GREEN for UND and North Dakota This LEED® Silver-certified project was designed for optimized energy efficiency — up to 24 percent less energy use than other buildings of comparable size and type. That means better stewardship of state resources, lower water use, environmental protection, and improved climate controls for comfort and economy.
Heyer Engineering Obermiller Nelson Engineering Peterson Construction Grand Forks Heating Air Conditioning Bergstrom Electric
Learn more about this project at: edbuilding.UND.edu
UND.edu
AN EQUAL OPPORTUNITY/AFFIRMATIVE ACTION INSTITUTION