Started with a superior product /market offering, a firm generates years of significant profitable growth opportunity. The hungry sales team – usually entrepreneur-led – fuels rapid, perhaps exponential growth.

Then, the firm hits a brick wall, stagnating. Analysis reveals the cause – new generic competition or changing customer demand. Ownership concludes the sales team is a “bunch of order takers,” waiting for the phone to ring.

There could be some truth here. Often sales team members modify their selling presentation and campaign, over time, to the “easiest to close” prospects. If the team ever had business development skills, they have now atrophied.

And the phone isn’t ringing.

Widespread sales stagnation in this recession has these consequences:

1) Many firms won’t survive; 2) The survivors will get stronger, smarter – leading to future growth.

A new, potent product/market offering would resolve the sales crisis. But is the firm organized to deliver the next successful offering, to overcome the evolutionary hurdles?

The classic evolutionary challenge for the entrepreneur/founder is to “let go.” At its inception, the firm required an entrepreneur to conceive and lead the crusade. With success, the firm needs evolution, organizing for and installing professional management. The domineering founder often precludes this, with a hand in every decision, stultifying both team growth and the firm’s structural evolution. The founder has to let go.

Typically “letting go” results in this standard structural differentiation: VP Sales, VP Manufacturing (Operations), CFO. The firm functionally specializes to achieve consistent best practices and to attract “A” performers who need independence. The founding passion isn’t necessarily present, but the firm is managed more efficiently, and on a path for solid continuous growth.

Depending on the product life cycle, this business model continues effectively for years, even decades, until interrupted by an external crisis, generally a substantial loss of sales and/or profit. The cause – typically new, aggressive competition and the declining product life cycle – catalyzes organizational evolution (or demise.)

The current recession’s impact has caused a widespread need for structural evolution.

For the “professionally” managed firm, the founder’s creativity and passion are glaringly absent in difficult times. The firm must encode the potential for evolution, even revolution, in its DNA. One approach develops and distributes these qualities in key departments, including new product development.

Another essential realm is sales. To prevent firm demise, the sales team needs constant innovation and development to: (1) help extend declining life cycles, funding future initiatives; and (2) lead the charge on new business initiatives.

The firm needs a permanent sales crusade culture. The key is: (1) continuous training to motivate, inspire and educate the team; and (2) one-to-one coaching, following training by the seminar leader – when the team is open to change and innovation.

This structure catalyzes necessary, short-term change.

Many firms don’t realize they need a specialist to handle this evolutionary crisis. Others wrongly think they have this capacity and therefore never properly install the sales crusade.

Michael Sahara’s Killer Angels provides an incisive leadership analysis, describing the Battle of Gettysburg and Robert E. Lee’s reliance on his generals to effectively execute his plans.

A similar reliance on business leadership often generates these outcomes:

1) Very strong controls; 2) An inability to provide necessary innovation and evolution.

This latter problem occurs when ownership expects the VP Sales to provide the necessary selling system, sales training and sales development. The VP Sales generally doesn’t have the necessary skills.

This is a “final frontier” challenge for all companies – to maintain effective controls, yet allow for necessary evolution, particularly within sales.

For as we all know, nothing happens until somebody sells something.

Woodlands Nursing Center is a skilled nursing center located at 1400 Woodland Ave. in Plainfield and operated by Genesis Healthcare. The Woodlands contains 120 beds, half of those being dedicated to sub-acute rehabilitation.

Specialized services are available for patients with a diagnosis of dementia and Alzheimer’s. In addition, the center has a 20-bed residential unit for customers who live independently, with nursing care available.

A comprehensive rehabilitation program is available to all residents of the Woodlands. This includes physical, occupational and speech therapy. The rehab department emphasizes a holistic approach to rehabilitation, always striving for the highest possible level of functioning.

Families are invited to visit the rehabilitation gymnasium both to observe therapy and to learn how to safely transfer a patient from curbside to car or from bed to bathroom. Therapy goals are functional. For example, when a patient has stairs to climb at home, practice on stairs is given by physical therapy.

Occupational therapy focuses on activities of daily living, including dressing, bathing and cooking.

Speech therapy seeks to improve communication skills, as well as to ensure the patient can eat and swallow safely and includes instruction on the most appropriate diet. Whenever possible, the goal of rehab is for the residents to return home to live independently or with families.

Residents of the Woodlands can enjoy a dining experience, rather than cafeteria-style meals. The dining room is decorated, complete with a fireplace and landscaped aquarium. A registered dietician oversees the dining room.

Part of the dietician’s job is to see that a variety of special diet requirements can be met, which is often critical to the healing process. On admission, each resident meets individually with the dietician to discuss food preferences and special needs.

The recreation department offers a wide variety of activities for residents, including cooking groups, gardening, crafts, painting, sing-a-longs, bingo and movie and horse racing nights. For a patient who may be bed-bound, the recreation department takes its services bedside to meet the individual needs of each resident. A monthly birthday party ensures that every resident’s birthday is celebrated and is special.

Recreation includes theme parties, such as Western day or holiday events. Musical entertainment is brought in and residents are encouraged to sing and dance along with the entertainers. On one occasion, a strolling violinist entertained the diners at lunchtime and on another an Elvis impersonator entertained residents and staff and encouraged them to sing along to favorite rock ‘n’ roll hits.

Residents of Plainfield and surrounding communities often tour the center and meet the staff, which specializes in geriatric care. Regular seminars and in-service training on the topic of aging keep the staff up to date.

The Woodlands Rehabilitation Center makes every effort to return patients to their homes. Of course, every resident wants to return home but for some that is not the safest or best alternative.

When this is the case, rehab continues to be available to support those who stay for long-term care.

A physiatrist, a doctor specializing in rehabilitation, consults with our rehab team on a weekly basis to ensure that we make the best decisions for each patient, including whether the patient can return home or needs additional care.

Genesis Healthcare operates 40 skilled nursing and assisted living facilities in New Jersey, including Woodlands. Some 6,000 employees provide care daily to more than 5,500 elderly residents.

Genesis also provides support services nationwide of medical equipment, pharmaceutical supplies, and home health care.

I have been following with great interest President Obama’s health care reform initiative now working its way through Congress. It has become pretty clear, however, that the proposals moving through the House and Senate are not about reforming the health care system in this country, but rather about improving access to it.

There are nearly 50 million people in this country, most employed, without medical insurance, the highest percentage of any developed country. For the most part these people are denied all but emergency health care, meaning they have to go to the nearest hospital emergency room when anything is wrong with them. This is a terribly inefficient way to deliver health services, and leads to cost increases for those with medical insurance.

The president’s health care initiative is aimed at getting these people some type of medical coverage. This may involve requiring them to buy coverage and subsidizing those who cannot afford it, and/or offering some type of government insurance program that can be purchased much more cheaply than normal commercial medical insurance.

So while this doesn’t provide much reform to the health care system or the factors causing prices to increase year after year, it is a pretty admirable goal to get more people insured. The cost of doing this is staggering, however, with estimates originally topping $1 trillion over the next 10 years, and somehow ultimately massaged down to only $600 billion.

So, how does U.S. Rep. Charlie Rangel (D-NY) propose we pay for all this? It’s easy – just raise taxes on people who make more than $250,000 per year. They’re rich. They can afford it. Besides, there aren’t very many of them, so they are an easy target.

When the Rangel Surtax is added to all the other new income taxes, rates for those earning more than $200,000 are going to skyrocket. According to analysis by the Tax Foundation, the highest combined state and federal income tax rates in New Jersey will top 55 percent!

New Jersey has a lot of families that make more than $250,000 per year, so the burden of this reform is going to fall disproportionately on our state. In other words, New Jersey will be an even bigger looser on the federal tax scheme than it already is.

I have a different solution, one that not only would raise more money more fairly, but would also get to the core of the health care problem. You see, I looked in the mirror recently, sideways, and I saw what the real problem is: I’m getting fat.

The average American is about 20 pounds overweight. Much of our increased demand on the medical infrastructure is weight-related. Heart disease, diabetes, stroke, back pain, joint replacements very often can be traced back to our weight. If we were not so fat, if we were in better shape, if we ate better and less, our health care needs would plummet.

So, the solution is to tax fat. If a tax rate were set at $100 per pound that we are overweight, the government would generate about $600 billion dollars per year. This would more than pay for all the Obama initiatives and leave plenty left over to radically modernize the health care system.

More importantly, we would be incented to start taking better care of ourselves. Boy, if it were going to save me $1,000 dollars in taxes, I would get really serious about dropping 10 pounds. With lower body weights, blood pressure and cholesterol would drop, cutting back on the need for medication and heart surgery. Smaller waistlines would result in fewer back problems, a leading cause of lost work time. All of this would result in a decrease in health care costs.

Most importantly, like smokers, overweight people put a burden on the health care system. It is only fair that we take responsibility for our actions. It is time for us as individuals to quit being lazy and expecting someone else to pay for the consequences.

Copyright James Coyle 2009

Where the Chamber Stands...

The Kool-Aid® is flowing at full tap in Trenton these days, only the drink stands on either side of the sidewalk are buying, not selling – as in votes.

One Kool-Aid stand is manned by Gov. Jon Corzine and the state’s Democrats, who are singing the praises of property tax rebates – likely hoping to buy favor with voters in the fall.

The stand across the street is crowded with Republicans attacking the other side for fiscal mismanagement and what they view as a fatally flawed budget for the current fiscal year.

It seems fitting that sidewalk drink stands are traditionally the domain of children, because the state’s government leaders certainly are acting accordingly.

First consider the comedy of property tax rebates.

Earlier this year New Jersey was deep in a budget crisis, with revenue coming in well below expected levels due to the recession. The state was furloughing employees and making draconian expense cuts in a desperate attempt to weather the fiscal year. At the same time, state leaders were searching for ways to further cut expenses and raise revenue in order to pass a budget for the approaching fiscal year.

Wisely, the Corzine administration eliminated property tax rebates for the coming year for all residents except seniors and people with disabilities. Set aside the issue that property tax rebates are mere gimmicks that allow a state government to take taxpayers’ dollars for a certain period before later returning some money simply to woo their favor. Eliminating the rebates in the middle of a financial crisis was a prudent decision.

However, prudence went out the window when the state was pleasantly surprised by an inflow of money through a tax rebate program – $600 million, or $400 million more than expected, according to the New York Times. Suddenly the property tax rebates – an incumbent’s best friend – were restored.

The $29 billion budget passed June 25 largely along party lines includes a tax increase of almost $1 billion, elimination of property tax reductions for the wealthy and significant cuts in healthcare, education and other programs, according to the Times. Certainly the windfall of the tax amnesty program could have been used to somewhat soften these measures, or to address the state’s continuing debt or underfunded pension plan. Yet the money is being returned to voters.

One can reasonably conclude that restoring the property tax rebates was simply a blatant attempt to curry votes prior to next fall’s expected close gubernatorial election.

Yet the Kool-Aid is flowing just as freely across the aisle in Trenton. Republicans are selling the public a line that it was the fiscal mismanagement of Corzine and the Democrats that led to the budget crisis in the first place. Apparently facts and reason are not in the Republican recipe for sidewalk selling.

This spring the 50 states collectively faced a more than $100,000 billion deficit, according to a report from the National Conference of State Legislatures, as reported by Time magazine. For the fiscal year just ended, revenues came in below expectations in 38 states, according to the National Association of State Budget Officers and the National Governors Association, as reported by Time.

California is paying tax rebates with IOUs, Alaska and Nevada will need to spend $30 million more to operate their respective states than they expect to collect in revenue and other states are taking steps ranging from shutting highway rest stops to raising public college tuition.

New Jersey is far from alone in this mess, yet state Republicans want voters to believe it was the fiscal blunders of the current administration that led to empty state coffers.

At least each side is selling a different flavor of Kool-Aid. Both taste lousy.

Unfortunately, the Governor’s Kool-Aid stand is costly, as well. Voters can discount the ramblings of the Republicans as mere partisan posturing and pre-campaign chatter. Restoration of the property tax rebates at a time when there are so many other budgetary concerns is not only fiscally imprudent but flat out irresponsible.

A poll of state residents likely would show an overwhelming preference to keep their hardearned money in the first place rather than get some back through property tax rebates. Absent that sound reasoning, certainly they will take the cash.

But state crises are not the time to set policy based on pleasing the electorate. Voters do not elect government leaders to be their friends. They elect them to govern, and wisely.

Restoration of the property tax rebates is poor governance. Even when washed down with Kool-Aid.

The deep and challenging recession we are experiencing has laid bare some hard truths about our economic system. While our main priority in responding to this economic crisis is to make sure people can find new employment or hold on to their current jobs, this is also a time when we have to take a good look at the how the entire economic system can be renewed to produce a more prosperous future. We have to move in a direction that helps ensure long-term economic opportunity and security, rather than just a series of booms and busts.

People normally think of education as an issue about the development of our children, about the strength of our families and about the quality of our communities – and it absolutely is all of those things.

But it’s also something else. It’s a vital economic issue. It’s about the continuing strength of our nation, our competitiveness in a global marketplace, our ability to keep up with innovation that’s happening at light speed.

Many of us in Congress have joined with President Obama in a commitment to making investments that help our economy recover quickly while laying the groundwork for 21st century economic security. These include as a central focus investments in education. And that is exactly why we made sure that funding for education programs was a big part of the economic recovery package that we passed as our first priority this year.

Out of that package highlights include more than $53 billion that will go to help states with their general education budget needs, $13 billion for disadvantaged students and $15.6 billion to help high school graduates pursue higher levels of education with larger Pell Grants.

Here in New Jersey our schools will see $2 billion to help keep teachers on the job, to upgrade classroom technology and to support early childhood development, among other uses.

If we are going to stay at the apex of the curve of innovation, it is going to take this type of investment in the development of our children. If the next iPod, the next generation of renewable energy sources or the next electric car battery is conceived, designed and manufactured oversees, we can’t just chalk it up to a better research and development effort.

We also have to account for how our “thinkers” are doing relative to “thinkers” abroad.

Innovation starts with a person who has knowledge, expertise and an idea. And more often than not, the seed for that process is a good education.

Of course, building economic security is not only about creating the next generation of entrepreneurs. It’s also about equipping the rising members of our workforce with the knowledge and skills that will allow them to get good jobs in the industries of tomorrow.

Our state is second in the nation in power generated from solar panels – we’re going to need a generation of workers that can design, build and maintain new solar farms. We already have two manufacturing plants for energy-efficient LED lighting – we’re going to need a generation of workers who can keep us in the forefront of the green economy. And we are at the leading edge of biotech discoveries that make miraculous improvements in health care – we’re going to need another generation of the world’s best doctors and scientists to keep improving people’s life expectancy.

New Jersey has long been the birthplace of innovation, from the days when Thomas Edison took an invention from his workshop and lit up the world. The breakthroughs that happen here, from the light bulb to disease-eradicating medicines, have not only changed lives, but have fueled economic prosperity.

That type of leading-edge innovation and productivity is part of our DNA here in the Garden State. We are full of potential. But for us to unlock it, our children need a foundation of the best possible education we can provide for them.

That is part of our economic recovery, and it is essential to our economic future.

When I get older losing my hair, Many years from now.

Will you still be sending me a valentine Birthday greetings, bottle of wine?

The Beatles first asked the question about products and services for seniors back in the 1960s with their song When I’m 64. They certainly were ahead of their time.

According to McKinsey Quarterly, by 2015 the Baby Boomer generation will account for 40 percent of U.S. consumption, everything from electronics and home furnishings to restaurants and, of course, health care.

This consumer group will yield extensive purchasing power. What are the opportunities for businesses and how can they prepare?

Baby Boomers are not your grandfather’s senior citizens. They are active and want the exercise and nutritional supplements that will keep them moving. From dance programs to sports junkets to adventure travel, entrepreneurs that can package life-enriching experiences in a way that engages boomers and makes them feel young will prosper.

In some sense, this is a form of matchmaking. Forming new social groups and networks that stimulate boomers will be most successful. Naturally, couples matchmaking will continue to grow as “youthful,” non-married folks seek partners.

Doing the garden, digging the weeds, Who could ask for more.

Will you still need me, will you still feed me, When I’m sixty-four.

Speaking of gardening, there has been resurgence in this hobby among boomers who desire organic and locally-grown produce as well as ways to pinch pennies during the recession. The return to gardening has been capitalized on by gardening stores both large and small, as well as a new breed of gardening consultants catering to the well-heeled boomers. The popularity of gardening and other related hobbies are anticipated to grow as boomers enter retirement.

Activities that allow boomers to connect to their youth also have great potential. One example of this is scrapbooking services that are designed to recall and memorialize wonderful experiences from the recent and not-so-recent past.

Other hobbies of potential are those which connect boomers to young people/children. With more and more boomers continuing to become grandparents (the average age of boomers who are grandparents is 53), entrepreneurs are also helping boomers connect with their grandkids in the form of fun activities ranging from zoo/park visits to pottery.

Those entrepreneurs who provide top quality and reliable services will be able to enjoy and maintain healthy profit margins. This will also be an opportunity for creative services; think not only masseuses, but mobile psychic readers, storytellers, clowns and musicians, as well, who help to make things fun for both those being cared for and the care givers.

Smart businesses that focus on design for this generation will be able to charge a premium for their products or services. From kitchen utensils to phones to sporting equipment to bikes and cars, those products that are designed for ease of use will sell far better and at a premium.

Good design is not only the province of companies like Apple, but small companies can also offer intuitive services at little cost. This better design can be in the form of low-cost web-based businesses which have become increasingly popular with web-savvy boomers.

So what do business owners have to say to their aging customers? Boomers await your reply.

Fazio, Mannuzza, Roche, Tankel, LaPilusa (FMRTL), LLC, of Springfield announced that John LaPilusa, CPA, was appointed by the Sisters of St. Joseph of Peace Health Care System Corp. as a trustee and treasurer of the Cusack Care Center at St. Joseph’s Home for the Blind 2009/2010.

Members of the firm also participated in their first Alzheimer’s Jean Day to raise awareness and help the Alzheimer’s Association accelerate research and move closer to a cure. FMRTL members were encouraged to wear purple and denim in exchange for a $5.00 donation to the Alzheimer’s Association.

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The Infineum Bayway Chemical Plant located in Linden recently was recertified as an Occupational Safety and Health Administration (OSHA) Voluntary Protection Program (VPP) STAR site for its safety and health programs. The plant is one of only 56 sites in New Jersey to currently hold this certification.

Infineum also has been recognized with the American Chemistry Council (ACC) 2009 Responsible Care® Sustained Excellence Award in the small company category. To be considered for the Sustained Excellence Award, a company must have an OSHA incidence rate of injury and illnesses in its workplace lower than 90 percent of all ACC member companies in the same category. In addition, it must demonstrate a positive trend in other performance metrics.

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Trinitas Regional Medical Center recently welcomed Dr. Barry Levinson to the Trinitas Comprehensive Cancer Center as the facility’s new medical director. Levinson joins Trinitas from Richardson Regional Cancer Center, an affiliate of the University of Texas  Southwestern Medical Center at Dallas, where he was the medical director.

Trinitas also recently received national recognition in the 2009 Aster Awards Program for excellence in medical marketing.

HealthyEdge, Trinitas’ quarterly consumer publication, was honored with a Gold Award in the 2009 Aster Awards competition in the External Publications category among 500+ bed hospital competitors.

In addition, the American Heart Association New Jersey Chapter awarded Trinitas its Gold Start! Fit-Friendly Award for the second year in a row. Trinitas is the only organization in Union County to receive this Gold designation for 2009.

Dr. Andrew Plump, vice president, Merck & Co., Inc. and 2010 Union Heart Walk Chairman, presents the American Heart Association’s corporate “Fit Friendly Award” to Nancy DiLiegro, vice president, clinical services at Trinitas Regional Medical Center.

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Spencer Savings Bank, headquartered in Elmwood Park, recently announced the winners of its annual scholarship program. Christopher Rodrigues of Arthur L. Johnson High School in Clark and Emily Torres of Lincoln Middle School in Garwood were awarded academic scholarships. Rodrigues received a $1,000 award and Torres received a $500 Coverdell Education Savings Account in recognition of their hard work and dedication throughout the school year.

Since its inception in 2002, The Spencer Scholarship Program has awarded $185,000 to exceptional students in recognition of academic achievements. The criterion used to select winners includes an outstanding GPA, a history of community involvement, leadership and potential in the business or finance fields.

Christopher Rodrigues of Arthur L. Johnson High School in Clark, one of the 2009 recipients of Spencer Savings Bank scholarships, receives his award from Christine Gasalberti, assistant manager of the bank’s Garwood branch.

Consumer perception is the key to survival as the recession puts pressure on small businesses.

Do not cancel sales. Do not cancel loyal customer discount cards. Do not fire experienced employees. Do not hire untrained workers to save money.

Now more than ever, maintaining a quality customer experience is crucial to the survival of your business. Getting the right message across to your customer will make or break your business during these hard times.

It’s essential to cut back during a recession, but the moment you sacrifice your customer’s buying experience your business is doomed. Quality of service and product should be elevated during a recession; knowing where to cut costs and where to improve service will promise your company’s success.

Keep your doors open. It all comes down to customer loyalty; with more competition and less buyers, quality of experience is key. Continue providing your base with reliable service, quality products and top notch customer service. Stay true to your company’s promises.

Don’t increase prices because you can’t make your bottom line. Innovate to give more value and more free bonuses on things that don’t cost you much.

Don’t cancel your regular sales deals; this will turn loyal customers off and they’ll go elsewhere.

Keeping your customers happy by staying in tune with their needs will build loyalty and allow you to scoop up more market share in the process.

Put your client first. Don’t skimp on things that could sour their buying experience. Quality of goods must remain high. Don’t switch suppliers just because they can do it cheaper. Remember you usually get what you pay for and your customers will notice. Instead, talk to your current suppliers and see what they can do to help on price. The chances are, they don’t want to lose your business and they’ll offer you a better deal.

Don’t fire your higher-paid employees just to replace them with cheaper, untrained labor. Now more than ever, customers want a high quality shopping experience with impeccable service and enthusiastic sales people. Your customers will respect you for your level of integrity and dedication to their needs, producing loyalty for years to come.

Show your clientele that you understand what they are going through. Clients want to know that you recognize we are all under the gun right now, not just your business. If you need to change your business model, be sure your customers understand your motives.

Show them that you want to continue to be there for them now, and when good times return.

Everyone is familiar with hard times, and we admire the ones that take the steps to get through it so they can be there for us tomorrow. It’s critical to cut costs during a recession and your customers understand that. Finding ways to cut bloated expenses rather than vital ones is the key to getting through this.

During tough economic times, it’s essential to get to the customer base with the right message.

This is your chance, as a business, to show your humanity and develop closeness with your customer. Let them know that you understand their hardship.