Tag Archives: business community

Staying Innovative as a One Man Operation

Phoenix Chamber seeks nominees for IMPACT Awards

The Greater Phoenix Chamber of Commerce (GPCC) seeks nominations for its 2015 IMPACT Awards, which honor the accomplishments of outstanding Valley businesses and the positive impact they’ve made on the Greater Phoenix business community.

Nominations — which can come from anyone in the community — are open from now until January 9, 2015, and can be submitted through the Chamber’s website. Two businesses — one with fewer than 250 employees and one with 250 or more employees — will be honored in each of the four categories:  Community Champion, Economic Driver, Entrepreneurial Excellence and Response to Adversity. An IMPACT Business of the Year will be selected from among the four category recipients in each business sector and will be announced at the 28th Annual IMPACT Awards Luncheon on May 13, 2015.

Since 1987, the Greater Phoenix Chamber of Commerce has recognized local companies that demonstrate superior levels of success while maintaining extensive community involvement, that excel entrepreneurially, that have survived tremendous adversity or that contribute to the Valley’s economic vitality. The GPCC encourages community members to nominate a deserving business — or even their own business — that has a strong footprint in the Valley that are deserving of special recognition.

“The Greater Phoenix Chamber of Commerce has celebrated some of the finest Valley businesses over the past 28 years and it is an honor to continue this great tradition,” said Todd Sanders, President and CEO, Greater Phoenix Chamber of Commerce. “We are proud to recognize the outstanding achievements of local companies who continue to innovate and set new standards that positively impact the greater Phoenix business community.”

For more information and to access the nomination form, please visit www.phoenixchamber.com/impact or contact Janelle Tassart at 602-495-6480 or jtassart@phoenixchamber.com.

AZRE Digital Issue

AZRE Magazine September/October 2013

AZRE Magazine September/October 2013

‘When one door closes, another opens …’

AmandaVentura_web

There are many famous quotes and accomplishments that can be attributed to Alexander Graham Bell. One of his more famous lines reads: “When one door closes, another opens; but we often look so long and so regretfully upon the closed door that we do not see the one which has opened for us.” In the commercial real estate industry, there were a lot of doors that were closed during the Great Recession. But thanks to the dogged determination, resiliency and leadership of Arizona’s commercial real estate companies — both big and small — the doors are once again opening and the industry is poised to capitalize on those opportunities. In this issue of AZRE, we look into:

  • Office and industrial: A panel of five experts size up two sectors that are gaining momentum once again. Also, a new and improved “Big Deals.”
  • Multi-family: This sector continues to sizzle. Check out our annual special section with the Arizona Multihousing Association.
  • Urban Land Institute: Arizona’s statewide convener for dialogue among industry leaders — true visionaries.
  • Coreslab Structures: Celebrating 25 years of excellence in Arizona.
  • Law: Social media becoming a new and necessary tool.

Finally, I’m sad to say that this is the last issue of AZRE to which former editor Peter Madrid will contribute. Peter helped build AZRE into the definitive publication for Arizona’s commercial real estate industry. So while we appreciate Peter’s contributions, we are happy that Amanda Ventura (pictured above) is taking the baton and bringing her award-winning journalism skills to AZRE. Amanda’s expertise, energy and commitment to excellence will make AZRE an even more authoritative voice for the industry.

When one door closes, another opens.

amanda-signature

Amanda Ventura, Editor

Take it with you! On your mobile, go to m.issuu.com to get started.

KEYSER-Final1

Chris Camacho Joins Keyser

Keyser — a commercial real estate advisory firm providing global real estate services to tenants and users of office, industrial, healthcare and educational space — announced today that Chris Camacho will be joining Keyser in a strategic leadership capacity to help grow and scale the organization.

“I am extremely pleased to be able to officially welcome Chris to the team,” stated founder Jonathan Keyser. “Chris is one of the most talented, knowledgeable, and service oriented individuals that I know, and his experience over the last 10 years working with CEOs, municipal leaders, and site selectors provide him with a skillset and perspective that is hard to find in our industry. In addition, his deep expertise in designing complex real estate and incentive solutions for both domestic and international corporations will be a huge value-add to Keyser’s clients going forward.”

Chris has more than 10 years of executive management experience in economic development, site selection, and cost optimization, tax analysis and state and local incentive strategies. He has served as an advisor in the real estate due diligence process for many Fortune 500 companies as well as emerging start-ups across the country. Prior to joining Keyser, Chris served as the Executive Vice President for Greater Phoenix Economic Council (GPEC) and oversaw the domestic and international business development strategies. He brings extensive experience in auditing and advising a wide diversity of industries including renewable energy, hardware and software, aerospace, industrial manufacturing, logistics and corporate back office. Chris has directly assisted more than 130 companies in their expansions or relocations to Greater Phoenix. Prior to GPEC, Chris served as the President/CEO of GYEDC, which focused on attracting new investment to a bi-national region in southwestern Arizona and Northern Mexico.

ConcertforaCauseLogoCropped

Cushman & Wakefield Future Leaders ‘Concert for a Cause’ to benefit Ryan House

Logo_2013Cushman & Wakefield Future Leaders “Concert for a Cause” benefiting Ryan House is scheduled for 6 p.m. on Oct. 24 at The Western, 6830 E. 5th Ave., Scottsdale.

The four-hour event will feature performances by Javier Garcia and Desert Dixie. During the show concertgoers will be able to enjoy the entertainment and also contribute much-needed funding that will help provide care, comfort and community to Arizona children and families at Ryan House. There will also be a raffle with items ranging from restaurant gift cards to hotel stays. Last year’s inaugural event raised almost $30,000.

All the proceeds from the concertwill benefit the mission of the Ryan House, which is to provide respite and palliative care to children with life-threatening conditions and, as-needed, end-of-life care. From diagnosis through end-of-life and beyond, Ryan House provides Arizona families a comprehensive program of family-centered care including medical, emotional, social and spiritual support services and therapies to enhance quality of life.

Ryan House is a 501(c)(3) organization and all donations are tax deductible. Ryan House is supported 100 percent by charitable contributions.

For more information or to inquire about sponsorship opportunities, contact Bonnie Machen at bonnie.machen@cushwake.com or Matt Coxhead at matt.coxhead@cushwake.com.

Construction Employment - Welder

74% of construction firms have trouble finding qualified workers

Nearly three-fourths of construction firms across the country report they are having trouble finding qualified craft workers to fill key spots amid concerns that labor shortages will only get worse, according to the results of an industry-wide survey released today by the Associated General Contractors of America. Association officials called for immigration and education reform measures to help avoid worker shortages.

“Many construction firms are already having a hard time finding qualified workers and expect construction labor shortages will only get worse,” said Stephen E. Sandherr, chief executive officer of the Associated General Contractors of America. “We need to take short- and long-term steps to make sure there are enough workers to meet future demand and avoid the costly construction delays that would come with labor shortages.”

Of the 74 percent of responding firms that are having a hard time finding qualified craft workers, the most frequently reported difficulties are in filling such onsite construction jobs as carpenters, equipment operators and laborers, Sandherr said. Fifty-three percent are having a hard time filling professional positions – especially project supervisors, estimators and engineers.

The association official added that most firms expect labor shortages will continue and get worse for the next year. Eighty-six percent of respondents said they expect it will remain difficult or get harder to find qualified craft workers while 72 percent say the market for professional positions will remain hard or get worse. Seventy-four percent of respondents report there are not enough qualified craft workers available to meet future demand while 49 percent said there weren’t enough construction professionals available, he added.

Sandherr said that many firms report they are taking steps to prepare future construction workers. He noted that 48 percent of responding firms are mentoring future craft workers, 38 percent are participating in career fairs and 33 percent are supporting high school-level construction skills academies. In addition, 47 percent of responding firms are offering internships for construction professionals.

Sandherr cautioned that more needs to be done to address labor shortages. He said Congress needs to jettison arbitrary caps on construction workers that were included in immigration reform the Senate passed earlier this year. “Lifting those restrictions will go a long way to ensuring construction jobs left vacant by domestic labor shortages go to workers who are in the country legally.”

He urged elected and appointed officials to do more to ensure public school students have an opportunity to participate in programs that teach skills like construction. He added that skills-based programs offer students a more hands-on way to learn vital 21st century skills such as math and science. Such programs also have been proven to reduce dropout rates and give students an opportunity to earn the higher pay and benefits that come with construction jobs.

Flexible Workplaces

Arizona Employers Learn Workplace Violence Prevention

The Phoenix business community has already experienced several tragedies, with the first workplace shooting of the year in January, and the most recent incident involving a personal relationship issue erupting into another workplace shooting. Though the circumstances leading to these violent outbreaks differ, business owners and human resources professionals can learn from them and be prepared to prevent similar situations.

On Wednesday, June 5, expert speakers Dr. James Turner and Mountain States Employers Council (MSEC) staff attorney Dave Dixon will share a series of interactive vignettes designed to help employers to respond promptly, effectively and appropriately to inappropriate workplace behaviors that create disruption in the workplace, while also minimizing risks related to unlawful discrimination under the ADA, even as disability claims continue to rise. The workplace violence discussions and other significant employment and labor law trends and changes are part of this year’s Employment Law Update at the Sheraton Crescent Hotel, 2620 W. Dunlap Ave., in Phoenix.

While violent behavior can manifest for many different reasons, mental illness is often a root cause. Employers must discern between abnormal but harmless behavior and the signs of a violent progression. MSEC, a leader in human resource and employment law services, helps employers understand the legal and psychological aspects of mental illness; identify warning signs of aggression; and ward off or respond to escalated incidents.

“Whether in the workplace, or society-at-large, failure to effectively manage conduct that may or may not be related to mental illness may bring consequences from simple organizational inefficiencies to the more tragic and violent consequences we have all too frequently seen,” said Dixon.

For more information about MSEC’s services or the Employment Law Update, visit www.msec.org.

For 70 years, MSEC has hosted educational events such as the Employment Law Update for employers throughout the Western United States to maintain productive employer/employee relationships and to build effective, successful businesses.

british airways

British Airways Adds Additional Flight Between Phoenix And London

British Airways announced that the nonstop service between Phoenix Sky Harbor International Airport and London Heathrow Airport will increase from six to seven days per week beginning December 5, 2012.

“This is great news for Phoenix and our entire region,” Mayor Greg Stanton said. “Intercontinental flights are huge contributors to the success of our Phoenix airport system, our city’s economy and our region’s overall economic future. Building upon the $33 billion the airport pumps into our economy each year, this new flight is a boost that shows how our economy continues to improve.”

This community has seen an economic benefit from the nonstop British Airways flight since it first arrived in Phoenix on July 1, 1996. Adding the seventh day of service is estimated to bring the total economic impact of this flight to $100 million per year.

“International air service development is a focus for us at the city of Phoenix because it’s good for jobs, business and our overall economic development,” said Phoenix City Councilwoman Thelda Williams, who serves on the Downtown Aviation Economy and Education subcommittee.

Airports compete for air service and Phoenix city manager David Cavazos is keenly aware of how important flights are to the vitality of the city and the State. “My goal is to continue to gain additional international routes, while ensuring that this British Airways flight remains successful,” he said.

This European service is important not only to the business community, but to the tourism industry as well. Sherry Henry, director of the Arizona Office of Tourism, said, “International visitors tend to stay longer to explore the state and more flight options from London will give travelers from the UK and Europe additional opportunities to visit Arizona.”

For more information on British Airways, visit British Airways’ website at britishairways.com.

Many Arizona Small Businesses And Banks Say A Federal Loan Program Isn’t Needed - AZ Business Magazine Nov/Dec 2010

Many Arizona Small Businesses And Banks Say A Federal Loan Program Isn’t Needed

President Barack Obama has signed a bill that aims to increase small business lending. But it’s not exactly popular among Arizona’s small companies and community banks. They question whether a multibillion-dollar loan fund created by the legislation will achieve its goal.

The Small Business Jobs and Credit Act of 2010 will establish a $30 billion Small Business Lending Fund within the U.S. Treasury. The Treasury will use that money to purchase preferred shares in small- to medium-size banks that voluntarily participate in the program, injecting new capital that the banks would be encouraged to lend to small businesses. The more loans the banks make, the lower the dividend rate they pay the Treasury.

“As a small business owner, I am allergic to government intervention,” says Charlie O’Dowd, president of Westcap Solar, a Tucson company that sells and installs solar photovoltaic and solar hot-water systems. “I don’t think that this legislation is going to be any more effective than the TARP (Troubled Asset Relief Program) legislation. In this economy, it’s not that there isn’t money to be borrowed. It’s qualifying for the loan that’s the problem.”

The new law also gives John P. Lewis a bad taste in his mouth. Lewis is president and CEO of Southern Arizona Community Bank in Tucson, and a member of the FDIC’s Advisory Committee On Community Banking.

“Last January, the committee had a robust discussion (on the legislation),” Lewis says. “The committee said, ‘We don’t want to be a part of this.’ Community banks don’t need the additional capital. I have more money than I know what to do with. I need qualified borrowers.”

O’Dowd and Lewis describe a situation that is frustrating for both and that neither believes government policy will resolve. O’Dowd says small businesses’ sales are slow, impacting their ability to qualify for loans. Lewis says his loan demand is flat because there are fewer qualified borrowers.

The Arizona Small Business Association points to a wary small business community that’s in no mood to take on more debt. Earlier in the recession, small businesses tried in vain to obtain bank loans, but now they are in survival mode, says Donna Davis, the association’s CEO.

“Bank loans are not at the top of their list now,” Davis says. “Some businesses have lending fatigue. They just gave up (trying to get loans). Now they are focused on lack of sales. If sales don’t pick up, if work doesn’t pick up, they won’t seek credit. If they can boost sales and profits, then they can justify hiring and expanding.”

One outside observer sees a triumvirate of doubt that the legislation will not mitigate. Dennis Hoffman, professor of economics at Arizona State University’s W. P. Carey School of Business, says this recession has caused consumers, businesses and banks to lose their confidence. Lacking the good credit risk they saw five years ago, banks have “pulled in their oars,” Hoffman says. Creditworthy businesses fret so much over the economy, they don’t even apply for loans. Recession-scarred consumers remain stingy.

“We need to climb this wall of worry to get out of this morass,” Hoffman says. “This is a market-based, private-sector issue that will have to work itself out.”

Gail Grace, president and CEO of Sunrise Bank of Arizona headquartered in Phoenix, doesn’t sense much support for the legislation among Arizona’s banks, and wonders how many community banks would be able to participate.

“Community banks in Arizona are stressed and many may not even qualify for this program,” Grace says. “You will still have to have a fairly healthy bank to qualify for this.”

Not everyone has a dim view of the law. Robert Blaney, Arizona’s Small Business Administration district director, notes that the law will increase the SBA’s loan guarantee from 75 percent to 90 percent, easing banks’ risk on those loans. The law also will lower fees and raise the SBA’s maximum loan amount from $2 million to $5 million. There are thousands of small business owners nationwide that were waiting for the lending bill to become law, Blaney says.

One of those is Benefits By Design, a Tempe company that sets up health benefit plans for small businesses. The company’s president, Kristine Kassel, says there is a need for loans and it would be helpful if just two community banks expanded their small business lending. She adds that any amount of new credit that can be extended to small businesses is a good thing.

Banks interested in acquiring low-cost capital might be attracted to the Treasury fund and they might be enticed by the built-in incentives to direct new-found capital into small business lending, says Dan Stewart, Arizona market president for Mutual of Omaha.

But then he echoes what others say: “The (law) doesn’t encourage banks to take on more credit risk, so qualified borrowers are the key.”

    By the Numbers
    The Small Business Jobs and Credit Act of 2010



  • Establishes a $30 billion Small Business Lending Fund within the U.S. Treasury
  • Treasury will use money to purchase preferred shares in small- to medium-size banks that voluntarily participate in the program
  • SBA’s loan guarantee would increase from 75 percent to 90 percent
  • The SBA’s maximum loan amount would increase from $2 million to $5 million

Arizona Business Magazine Nov/Dec 2010

Downtown Phoenix Shopping

The Goal Of Shift Arizona Is To Get People Shopping Locally, Boosting The State’s Economy

In an effort to jolt the state’s economy back to life, Local First Arizona is encouraging Arizonans to shift 10 percent of their purchases to local businesses.

Ten percent might not seem like a lot, but when even a small amount is fed into a local economy, it can grow exponentially. The shift can be made anywhere from banking, food, products or services.

This year-long campaign, called Shift Arizona, is modeled after an economic impact study performed in Grand Rapids, Mich. The study showed that a 10 percent shift by all residents would create 1,600 new jobs, local wages would increase by $50 million and $130 million would be fed into the local economy.

This study is driving Shift Arizona to strengthen Arizona’s economy and foster civic pride along the way.

“A vibrant, robust local business community is what I look forward to,” as a result of Shift Arizona, says Adam Goodman, president of Goodman’s Interior Structures and a Local First Arizona member.

Taking part in Shift Arizona isn’t only about shopping at local boutiques, it’s about buying locally made products and purchasing services provided by locally owned companies, says Kimber Lanning, founder and director of Local First Arizona.

Lanning suggests making a few simple shifts, such as dining at local restaurants, frequenting local theaters, or stopping at a local coffee shop every fifth time you grab a cup of joe — she understands that Starbucks habit is tough to break.

Local First Arizona’s website provides a list of locally owned businesses to help make your transition easier.

However, buying local doesn’t mean completely changing your routine, Lanning says.  Many chain stores, such as Target and Walmart, stock Arizona-made products like Shamrock Farms, China Mist teas and Hickman’s eggs, Lanning says.

Local companies care about and support other local organizations, charities and businesses, while a national company will support the local businesses near its headquarters, Goodman says.

Buying local will affect much more than just that one business; it will create spending throughout the community, Goodman says. He adds that his own business is looking at what it can do to spend more money locally.

Shift Arizona also is dispelling the myth that local stores are more expensive than national chains, Lanning says. Oil changes and pet food are often cheaper at local stores, she says.

In a continuingly tough economic climate, Shift Arizona is championing using your wallet as you would use your vote.

“We’re at a point in time where the discussion amongst our elected officials revolves around whether we want our taxes raised or our services cut, but in reality, through our purchasing power, citizens can grow the economy without spending any more money,” Lanning says. “We just need to make our money shift to a more locally based economy.”

Lanning says Arizonans can boost the economy not by spending more money, but by spending their money a little more thoughtfully.

Jerry Colangelo discusses Arizona's economic future and more. - AZ Business Magazine Nov/Dec 2010

CEO Series: Jerry Colangelo

Local businessman Jerry Colangelo talks basketball, Arizona Commerce Authority, the recession and more.

Jerry Colangelo
Title: Principal Partner
Company: JDM Partners

Did you always aspire to be in business or was it circumstances that put you on this path?
I transferred universities for basketball reasons, originally. I went to (University of) Kansas for a semester to play with Wilt Chamberlain. When he transferred — when he quit school — I transferred to (University of) Illinois. I had taken business courses in Kansas and when I transferred I brought those credits with me. But then I went into education. I thought I would teach and coach. But I had some business background and I was always a little bit of an entrepreneur, in terms of trying to make a dollar as a young kid, little businesses, etc. So it all kind of came together and I ended up being in the sports business, which means that I was being prepared all along.

How would describe the Valley’s business environment for entrepreneurs?
I think it is a good place, but it has evolved. I came to the Valley 40-plus years ago, when things were kind of wide open and there were many more opportunities, at least from my perspective. You had the ability to get things done because it was still a small town, to some degree. I’ve seen it quintuple in size, if you will, and we’ve had our ups and our downs in the Valley, but we’re trying to re-identify who we are and what our future holds. But there will always be room for entrepreneurs. There’s no question about that. I still believe in the Valley and the business climate, and it’s going to get better as our economy gets better, so there’s room.

How will the new Arizona Commerce Authority help the state’s economy?
I think the Commerce Authority is coming at exactly the right time. We have the opportunity to re-do how we do business in this state. It’s very important to retain the businesses that we have and it’s very competitive out there. The states are competing for big business and small business. We need to create a climate that is truly conducive for small and big business to come to Arizona. I think that with the people, the manpower that we will have on this authority, we have a chance to make that happen.

I’ve been a little outspoken about the fact that we need the Legislature to help with the funding — there’s no question about that — but at that point they need the business community to conduct the business of commerce. That’s what they know best. And if we can kind of separate that, we have a great opportunity to go out and be competitive. We’re going to need some things from the Legislature. Incentives — that seems to be a dirty word to some people, but it’s reality. That’s what’s happening in other states. That’s why they’ve had so much success. We have the models to look at.

For me, coming from the world of sports and every day you’re competing, it’s another game, it’s going for another win. This is a classic example of taking something that needed to be restructured, a little like my USA Basketball experience of late, when I took over the program and it was back on its heels. Today, we’re the defending gold medalists in every category, men’s and women’s, every age bracket. We have a chance with the Commerce Authority to basically do the same thing. We need to win a gold medal. We need to go out and compete with all the other states, because we have a lot to offer in this state. We just need some incentives. We need to look people eyeball-to-eyeball and sell them on why it’s important to come here, why they will enjoy not just the quality of life. We need to improve our education, we need to make it a better community in which it is conducive to do business here. If you get people jumping on the bandwagon, we have a chance.

How did the recession affect the sports industry in general and in the Valley in particular?

The recession has hit everyone and every segment of the marketplace. It’s interesting; when things are really bad economically, people still want to be entertained. … Vicariously, people follow sports teams because they once played, they have some affiliation, they love the association when their teams are winning. When teams are losing, that’s when they jump off the bandwagon. … We took a hit here in the Valley big time. Because we have so much emphasis on the construction industry, we were hit harder than other parts of the country — in the Southwest. No. 2, we are saturated right now with sports teams — no question about that. Everyone was affected. If we had continued with our growth, because we were on an incredible growth curve, we would have grown into maturity with all of our sports teams. What we have gone through have been some real challenges. But the good news is that the sports franchises have adjusted. They’ve had to adjust their policies, their attitudes toward discounts, etc. And that’s one of the things I’ve noticed in sports in the last two years is that they’ve made adjustments to deal with what’s taken place with the recession.

You are still involved in sports, but you’ve also moved on to real estate development. Some would say that’s a risky move. How do you respond to that?
People say when you make money in real estate is when you buy appropriately. There are a lot of deals out there to buy in — they say cash is king. Well, there are a lot of financial institutions sitting on a lot of cash, but they’re not really willing to let the consumer have that cash. So everyone is very hesitant right now. There is great opportunity in real estate. You have to be more specific about residential, commercial. My partners and I are involved in some iconic properties: the (Arizona Biltmore Golf & Country Club), the (Wigwam Golf Resort & Spa). In taking that step with distressed properties, we were able to take these properties out of bankruptcy. We believe we made a good buy at the time. We are making an investment in those properties, because we believe in the future. We believe things will get better over a period of time and that the real estate marketplace will continue to get better over a period of time. We’re sitting on 37,000 acres of property on the west side of Phoenix that have the ability and the approval to build a city of over 300,000 people. But this isn’t the time to start that project — that’s in Buckeye, Ariz. Do I think someday that will happen? Maybe in some way, shape or form; maybe not the way it was visualized five years ago, but are people going to continue to come here? I believe so. But back to the Commerce Authority; we have to bring jobs to Arizona. So by being creative and being aggressive going out to bring companies here — with high-paying jobs, not just service jobs — then we will continue with the growth pattern, because we have so many wonderful things to offer in terms of quality of life out here in the Southwest.

What advice do you have for entrepreneurs who are ready to take their companies to the next level?
Don’t be afraid to fail. … You have to take calculated risks. You have to be willing to step out on that board knowing you might get pushed, fall off. The worst thing that could happen is you do — you get up and you start over again. One of the things that has probably marked my career is that I started with nothing and I was never afraid to go back to nothing, but I was going to enjoy the ride. And so as it relates to my mix of experiences. Being competitive as an athlete prepared me for the business world, which was another competition. No one has batted 1,000 percent. Hall of Famers hit .300 — that’s only three out of 10. So why is it any different in business? You’re going to make mistakes, you’re going to learn from your mistakes. You can’t be afraid to fail, you have to be willing to take that kind of calculated risk. I’ve seen so many people, again in my lifetime, who have complained and whined about never getting an opportunity. And I would say to them, “Opportunity walked by you three or four times, but you never recognized it, because you’re so busy whining.” Get out there, don’t be afraid to compete and believe in yourself.

    Vital Stats




  • Became general manager of the new NBA franchise Phoenix Suns in 1968
  • Coached the Suns in the 1969-1970 and 1972-1973 seasons
  • Purchased the Suns for $44.5 million in 1987
  • Founder and owner of the Arena Football League’s Arizona Rattlers from 1992-2005
  • Played a key part in moving the NHL’s Winnipeg Jets to Arizona in 1996
  • Launched the WNBA’s Phoenix Mercury in 1997
  • Launched the MLB Arizona Diamondbacks in 1998
  • Served as chairman and CEO of the 2001 World Champion Diamondbacks
  • Chairman of the NBA’s Board of Governors from 2001-2005
  • Sold the Suns, Mercury and Rattlers to an investment group headed by Robert Sarver in 2004
  • Sold his controlling interest in the Diamondbacks to a group of investors in 2004
  • Elected to the Basketball Hall of Fame in 2004
  • March 26, 2004 proclaimed Jerry Colangelo Day in Phoenix
  • Named director of USA Basketball in 2005
  • Received the Spirit of Caring award in 2005 from the Valley of the Sun United Way
  • Inducted into the Suns’ Ring of Honor in 2007

Arizona Business Magazine Nov/Dec 2010

AzHHA’s 2010 Annual Membership Conference - AZ Business Magazine Sept/Oct 2010

AzHHA’s 2010 Annual Membership Conference Is Aimed At Helping Members Prepare For Change

With the health care field on the brink of a major upheaval, the Arizona Hospital and Healthcare Association’s (AzHHA) 2010 Annual Membership Conference offers members information on what to expect in the future.

The theme, Bringing the Future into Focus, incorporates a mix of topics and speakers intended to appeal to a diverse hospital audience. Attendees will hear from leading economists, patient safety experts, health care visionaries and others.

LeAnn Swanson, vice president of education services for AzHHA, says the conference is the ideal venue to bring the new health care reality into full focus.
“Some of the best minds in the industry will be providing hard-hitting education and thought-provoking commentary,” she says. “This conference is intended for the entire hospital family, including the C-suite leadership team, hospital trustees, legal counsel, operations, quality, patient safety, human resources, and marketing officers.”

This year’s conference, Oct. 14-15 at The Buttes Resort in Tempe, kicks off with a keynote session featuring Lowell Catlett, Ph.D., regent’s professor, dean and chief administrative officer at New Mexico State University’s College of Agricultural, Consumer and Environmental Sciences. He will speak on the present and future of the economy.

Catlett notes that economic downturns are common — with 14 recessions during the past 80 years — and provide a means for society to re-balance what it deems to be important.

“Every recession leads to a spurt in new business starts, reformulation of business practices and new technological adaptations,” he says. “This current pause is no exception as we focus on what we value most. Get ready for phenomenal growth in health care, energy and lifestyle markets. For those willing to embrace the opportunities, the next decade will be successful beyond any in history.”

Immediately after Catlett’s presentation on Oct. 14, the general session will feature Ron Galloway, director of the documentary “Why Wal-Mart Works and Why That Makes Some People Crazy,” and the newly released “Rebooting Healthcare.” His topic, Wal-Mart and the Future of Healthcare, covers in-store health care clinics that offer everything from eyeglasses to flu shots to urgent care.

Galloway says the discount retailer aims to leverage its 4,000 stores into the largest force in American health care.

At the Oct. 15 breakfast meeting, sponsored by the American College of Healthcare Executives (ACHE), Chris Van Gorder, president and CEO of Scripps Health in San Diego and ACHE 2010-2011 chairman, will offer a look at Scripps’ medical response team. Van Gorder will describe the team’s efforts in the Hurricane Katrina-ravaged Gulf of Mexico, San Diego after its massive wildfires and quake-stricken Haiti.

Concurrent breakout sessions will look at the key drivers of physician behavior and the natural tension that exists in doctor-hospital relationships; trends and technologies that are “re-forming” health care in unexpected and beneficial ways; and the notion of being in a health care bubble with a high potential for a correction over the next five years.

The closing session will feature John Nance, author of “Why Hospitals Should Fly,” which was named the 2009 book of the year by the ACHE. Based on his book, Nance offers some solutions to the patient safety and quality-care crises that resonate deeply with all health care audiences.

The conference also will feature AzHHA’s annual awards luncheon, and a president’s reception that will give attendees an opportunity to say goodbye to the organization’s longtime president and CEO, John Rivers, as he nears retirement. The reception also will serve to introduce AzHHA’s new leader, Laurie Liles.

Along with the conference, during the upcoming year AzHHA also will offer a series of webinars and other events of interest to members of the hospital and health care industry, as well as representatives of the business community, Swanson says. The emphasis will be on compliance-related topics, including rules and regulations of the Centers for Medicare and Medicaid Services, the Health Insurance Portability and Accountability Act (HIPAA), and the Federal Emergency Medical Treatment and Labor Act, also known as EMTALA.

To learn more about upcoming education opportunities from AzHHA and to register for conference events, visit www.azhha.org/educational_services and click on education events.

    Arizona Hospital and Healthcare Association’s
    2010 Annual Membership Conference

    Oct. 14-15
    The Buttes Resort
    2000 Westcourt Way, Tempe
    www.azhha.org

Arizona Business Magazine Sept/Oct 2010

Valley Forward: Colin Tetreault

Colin Tetreault
Master of Arts Student
Arizona State University, School of Sustainability
schoolofsustainability.asu.edu

As a student at the Arizona State University School of Sustainability, Colin Tetreault is exploring ways for the business community to play a greater role in enhancing the global environment.


It’s a natural blend of interests for Tetreault, who is pursuing a master’s degree in sustainability and has a bachelor of science degree in marketing from the ASU W.P. Carey School of Business, as well as a minor in sociology. He has a diverse business background and skill set tempered in marketing, business development and philanthropy. His goal is to integrate his business acumen and cutting-edge knowledge of sustainability.

When ASU President Michael Crow said, “Sustainability is a way to grow and prosper while reducing the stress on the planet,” and asserted that sustainability would be a hallmark at ASU, Tetreault says, “I knew this was absolutely something that I not only wanted to pursue, but I felt compelled.”

Tetreault’s background led him to the field of sustainability.

“I grew up hiking and climbing and having an appreciation of the outdoors,” he says, “but my parents are both business individuals. My mother was a professor of marketing and my father was a business executive. I loved being outside, but I also loved what business can do. Business can accelerate change and can act as an advocate for it.”

Some individuals may view business as being unfriendly to the environment, and with some justification, Tetreault says.
“Admittedly, in certain instances they may be right, but now business has done more than ever for the environment and can act as an advocate for the world,” he says. “It marries two areas that I love — a synthesis of business and the entire global perspective of sustainability, which is not just hugging trees and savings animals.”

Sustainability will provide a “meaningful, productive and just way of life,” Tetreault says, adding that it is vital to save the trees and have clean air so humans can live on this planet.

“Sustainability is paramount to that, to help achieve economic viability and a robust society,” he says. “Everything is connected. Our actions have a direct impact on us now and in the future and on everything around us. I feel this is my calling.”

Tetreault, who joined Valley Forward this year, hails the organization for its role in preserving the environment and for being “not only an aggregator of information, but also an advocate for positive change.”

“Valley Forward embodies those type of ideals,” he says.

man with red tie standing in front of Dean's office

CEO Series: Robert E. Mittlestaedt Jr.

Robert E. Mittelstaedt Jr.
Dean, W.P. Carey School of Business at Arizona State University

How is W.P. Carey’s curriculum changing due to the economic crisis?
The curriculum in any business school has to involve some fundamental, timeless subjects that never change. So accounting and some aspects of finance and people management and other things will go on forever, but in every case we have to find a way to adapt to the changes in the external environment, whether it’s societal or specific kinds of business issues. I think that most business schools now are re-thinking seriously their curriculums in light of what has happened in the last couple of years, in particular issues in the areas of risk management, ethics in decision making and globalization … It doesn’t mean that the entire curriculum will change, but we have to find a way to weave those things more into almost everything we teach.

Could business schools have done more to create an ethical climate among corporate executives that could have averted this crisis? Does that argument have any merit?
My experience over many years now tells me that parents have to do more to teach ethical values to their children, and society has to take responsibility for holding people accountable for ethical behavior. Sadly, I have found that in most people, when they cross ethical lines, you find out it’s not the first time and they started doing it early in their life. By the time we get them as undergraduate business students, that’s about the end of the time when you can influence it.

We push hard on ethics from day one, and the students who come into our program hear about ethics on day one from me, and throughout the time that they’re here and they are required to take ethics courses. … This is something that’s a broad societal problem that we have to deal with, and we’re are doing as much as we can in business schools and will continue to put even more emphasis on it, but it’s not something that can be solved just in a business school or just in a university alone.

What are some of the future trends you see for business schools?
I expect to see all business schools more concerned with some of the things that we have been thinking about here at ASU. For instance, whether you believe in global warming or not, it is indisputable that we have to worry about sustainability, simply because of the number of people on the planet. … There are all sorts of things that become different issues where we have society and business interacting, whether we like it or not, in a much more integrated fashion than we have had in the past. … Issues of instant communications, doing business differently than our predecessors did, are very real and have to be part of a curriculum. … All those things find their way into a curriculum, both in terms of changing the way we teach, the kinds of things we teach, the impact they have on individuals.

How would you assess the relationship between W.P. Carey and the Valley business community?
I believe that our relationship with the business community at the W.P. Carey School is quite strong. We have many business leaders that are on our advisory councils, advisory boards to departments, to the whole school; we have many businesses that support us by sending students here to work on their MBAs or even their undergraduate degrees. And we have many business leaders who are not graduates of our school but who believe we have to have a strong business school to help Phoenix grow, and so they support us.

Describe the education industry in Arizona in terms of employment.
Education is a big sector of our society and I don’t believe there are very many people today that would deny that education needs to be there. …  (T)here’s more to learn today and a child today needs to learn more and get to a higher level of knowledge just to be competitive in the work force than they did a generation or two generations or three generations ago. You have to have an education sector that is strong and employs a fair number of people if you’re going to be competitive.The fact that we have gone through a financial crisis and budget cutbacks and furloughs and layoffs means that it’s not different than any other business, and it is in fact a business. It may be state supported, partially in the case of our university, but it is nonetheless a business that is subject to the same kinds of economic whipsaws as other sectors. The difference here is that our students don’t just go away because the economy got worse. In a retail establishment the customers may not show up and you may not have to have as many (establishments) open. We still have 52,000 students showing up on this campus in the fall …

    Vital Stats




  • Dean at W.P. Carey since 2004.
  • Between 1973 and 2004, he served in numerous leadership positions at The Wharton School at the University of Pennsylvania.
  • Author of “Will Your Next Mistake Be Fatal? Avoiding the Mistake Chain That Can Destroy Your Organization.”
  • Earned his bachelor’s degree in mechanical engineering from Tulane University.
  • Served five years as a U.S. Naval officer.
  • Received an MBA from the Wharton School.
  • wpcarey.asu.edu
The Business Community Is Ringing A Cautionary Bell On Further Cuts To The State’s Education System

The Business Community Is Ringing A Cautionary Bell On Further Cuts To The State’s Education System

Good schools are good for business. It’s that simple. Contrary to popular belief, incentives and tax breaks aren’t necessarily the only things businesses take into account when considering a move to Arizona or an expansion of a local operation. Sure, they want to make money, but the quality of the education system, from K-12 through colleges and universities, also is a key element in the decision-making process.

In early July, $3.2 billion in budget funding for the K-12 public education system was restored after initially being cut by Gov. Jan Brewer in a line-item veto. The education budget was also increased by $500 million, which now qualifies the state for $2.3 billion in federal stimulus money. Despite dodging that bullet, schools remain under the threat of future budget cuts, and that has caught the attention of business leaders. But paying attention isn’t enough. They need to be more involved in the process, insiders say, establishing and maintaining working relationships with state legislators who control the purse strings.

The business community has a stake in education on two fronts, says Chuck Essigs of the Arizona Association of School Business Officials (AASBO), which provides professional development opportunities for individuals working in all jobs in the education field.

“One,” he says, “is the ability of the education system, both elementary and secondary and the universities, to prepare an adequate work force, and to make sure schools are adequately funded so they can carry forth their mission of having an educated population. So when the business community hires people, they’re hiring people who have the skills and training to be productive workers.”

The second aspect involves Arizona businesses that are recruiting workers from out-of-state or businesses that are considering an expansion to Arizona from elsewhere.

“If those workers have school-age children, they want to know what the school system is like,” says Essigs, AASBO’s director of government affairs. “If they feel that their kids are not going to get a quality education, it might make them hesitant to leave where they are. They might think twice about taking a promotion and putting their kids at a disadvantage in a school that’s not up to the standards they want.”

Robert E. Mittelstaedt Jr., dean of the W.P. Carey School of Business at Arizona State University, says most businesses are far more concerned about the general education environment.

“I remember a bank official in Philadelphia 25 years ago saying he couldn’t find a receptionist who could read and write,” Mittelstaedt says. “You still hear that. Companies expect to have an education system that graduates students who are qualified to enter the work force in some minimally accepted level.”

If the public schools fall short, perhaps because of inadequate funding, the option of sending children to private schools becomes a cost factor for employees.

Javier Rey, vice president-operations for State Farm Insurance’s Tempe operations center, says it’s critical that Arizona’s youth are better prepared for higher education, so they can contribute to the nation’s and state’s civic, economic and social advancement.

“The quality of schools is a factor that businesses look at when considering relocating or expanding,” Rey says.

Christopher Smith, manager of government and regulatory affairs for Cox Communications, calls education “critical to economic development.”

“It is an essential ingredient in the lifeblood of our economy, both nourishing the supply of talented workers and attracting and retaining the customers they serve,” Smith adds. “Education ranks high on the various lists of important factors in location/relocation decisions, not only due to the increasingly critical competition for knowledge workers, but also because executives making these decisions care deeply about the education of their own children.”

Smith gives Arizona’s education system reasonably satisfactory grades, but says the status quo is not good enough to meet today’s challenges.

“We need to break the mold a bit and unleash more of what made America so great — liberty, bold innovation, inspired risk-taking, creativity, robust competition and an unflagging entrepreneurial spirit,” he says.

Susan Carlson, executive director of the Arizona Business & Education Coalition (ABEC), a nonprofit K-12 education policy advocacy organization, says the business community needs to be more involved in the school-funding process.

“Business needs to be engaged in the conversation,” she says. “They need to watch what the Legislature is doing. We can’t keep saying ‘no’ around tax reform and ‘yes’ around increased skills for students. It may take more money, if money is allocated to the right things. It’s going to take being focused on research-based strategies. Educators are willing and committed to support research-based strategies, and redirecting some of the funding that exists.”

Law Review - Arizona’s Legal Landscape

A Look Back Finds Substantial Changes To Arizona’s Legal Landscape

Rapid-fire change has become the status quo in the legal and business community over the past 25 years. This change is particularly apparent to me, as my firm, Fennemore Craig, will celebrate its 125-year anniversary in Arizona next year, and I have practiced law for more than three decades.

One of the most pronounced and positive changes over the years has been who becomes a lawyer. Through an increased emphasis on diversity, law firms and legal departments have become places of opportunity for people of all backgrounds, reflecting the diverse nature of our communities and clients. We can do better, but the profession has made significant strides in the area of diversity since the 1980s.

While the face of the state’s law firms has changed, so has their size. Not too many years ago, the largest firms in the Southwest were still relatively small, with client bases dominated by locally headquartered companies and financial institutions. Since the 1980s, the region has lost quite a few headquarters, yet law firms like Fennemore Craig have benefited from strong economic growth in the Sun Belt, with Phoenix emerging as a regional business hub.

Notwithstanding the current economic downturn, the long-term economic prospects for the region promise continued opportunity. This economic strength has led to growth among several of Arizona’s home-grown firms and it also has attracted firms with their principal offices in other states. In turn, Arizona firms have responded with a growing platform of offices and lawyers expanding into other markets. The influence of technology in changing the legal profession over the past 25 years cannot be overstated. The pace and volume of work for us and for our clients have increased exponentially. Research, which is central to the law, has been almost totally automated. While successful lawyers still must be good communicators and excellent practitioners, information flow occurs literally around-the-clock. Waiting to work on a transaction or litigation based on deliveries through the U.S. Postal Service has gone the way of the typewriter and the mimeograph machine. Transmittal of documents, filings and other activities occurs primarily on an electronic basis and the demand for quick responses has increased accordingly.

The professional aspects of practicing law have shifted as well. Training is better than ever, though time pressures mean some of the one-on-one mentoring and discussions with senior lawyers that characterized much of my early professional learning curve are more rare.
As a credit to Arizona, it is also important to note that the state’s institution of the merit selection system for its judges created a better, more professional judiciary. Merit selection has improved both the state’s justice system and the practice of law here in terms of professionalism, fairness and quality.

One of the appealing aspects of the legal profession is its strong tie to tradition. We must discern when tradition is fostering positive values, rather than preserving the status quo for its own sake. The positive values inherent in the profession 25, even 125 years ago, remain true today regardless of the changes in pace, volume and complexity in the practice of law. Then as now, we have the opportunity and responsibility to help people solve problems and get things done.

Small Businesses Continue To Power The Valley’s Economy While Maintaining A Personal Touch

Small Businesses Continue To Power The Valley’s Economy While Maintaining A Personal Touch

As we approach a new era in Arizona business, I find myself reminiscing about the small business environment in the Valley 25 years ago, recalling the pioneering spirit of many courageous and determined entrepreneurs. In that era, the Five Cs were predominant revenue sources: cotton, copper, climate, citrus and cattle.

That is no longer the case in today’s marketplace. Technology, biosciences and health care are now dominant industries. Although today’s business climate is faster paced, it still preserves the attitude, perseverance and independence of the earlier years, and 97 percent of Arizona commerce is still fueled by small businesses.

In the Valley of 25 years ago, Motorola and Honeywell were key players in the corporate arena, and the “good old boys” network was alive and well. Though there were fewer participants and less competition, who you knew played an important role in opportunities. And, yes, business was done face to face. Often, a small business venture was cinched with a sincere handshake or a proposal outlined on a paper napkin over a cup of coffee.

And don’t forget the “good old girls.” Arizona has always been progressive with women’s involvement in business and political leadership. Arizona gave women the right to vote before the nation did. We have had four female governors in the past 25 years — no other state comes close.

’ve always called Phoenix “the biggest small town.” Even though it has grown to become the fifth largest metropolitan city in America, it still feels like a big small town to me. And, in many ways, Phoenix’ small business community connects much the same as it did in the small-town era, with networking, referrals, camaraderie and support.

The explosive change that arrived 25 years ago was technology. That’s when the microcomputer industry propelled us into a new era where cell phones, the World Wide Web and computer automation were about to be unleashed on our small businesses. I remember hauling around phone books and city maps in my car or stopping at a convenience store to use the pay phone to verify directions to a meeting — no MapQuest, no Google, no GPS. And today, if you want to know about social media, ask a 13-year-old.

Of course, 25 years ago there was less traffic and fewer freeways. For relaxation, I would head to Tempe, where I’d stroll along Mill Avenue and wander into Changing Hands Bookstore, and then head to Cookies From Home. With my new book and chocolate chip cookie,

I’d settle into a comfortable bench. Today, Mill Avenue is a much different business setting in the heart of Tempe. Also, light rail has rejuvenated many small businesses along its pathway through Phoenix.

In the past, the Valley’s small businesses have experienced many economic storms. Any downturn forces small businesses to reexamine expenses, processes and strategies, while requiring more efficiency, resourcefulness and creativity. Sometimes the hard decision must be made to retool, reinvent or even to start from scratch.

I think it is important for businesses that are doing well at this time to reach out to their suppliers and partners and “pay it forward” by doing business with those who may be struggling. Surviving these challenging times will fortify these businesses and poise them to recapture markets and revenues, and flourish in the upturn.

The sun shines on our business climate, with Arizona consistently in the running for one the top five states for small business. I believe small business will always be an integral part of the identity of Arizona; a place where we nurture creativity, value independence, respect stamina and expect tenacity.

Remember, the threads of small business weave a strong and vibrant tapestry, like the blanket you toss onto the back of a bronco. Sometimes it’s a wild ride and you need to hold on.

american flag, protest

Legal Arizona Workers Act Does Not Cause Expected Upheaval

In 2007, the state of Arizona made its first foray into “immigration reform” when it passed the Legal Arizona Workers Act. However, before the Legal Arizona Workers Act (LAWA) even became effective on Jan. 1, 2008, the Legislature went to work on amending the statute, presumably to “cure” some of the more controversial aspects of the law.

While the fundamental purpose and structure of LAWA has not changed, employers need to be aware of the current version of the law in order to limit the chances of being on the receiving end of an enforcement action. For example, the same legislation that tweaked LAWA also criminalized the act of knowingly accepting identity information from someone who is not actually the person represented in that identity information. Nevertheless, recent trends reported by a researcher from the University of Arizona suggest the enforcement tsunami that was expected to hit the business community is, up to now, little more than a ripple in a pond.

LAWA prohibits employers from “knowingly” or “intentionally” employing any unauthorized alien workers after 2007, and creates stiff penalties for employers who do. Penalties for first violations include mandatory probation for, and possible temporary suspension of, all business licenses issued by the state of Arizona. For a second violation during the probationary period, whether knowing or intentional, employers face permanent revocation of their state-issued licenses — thus effectively preventing the employer from doing business in Arizona. LAWA also requires every Arizona employer to verify new hire work eligibility through the federal government’s E-Verify system. However, LAWA created no “penalty” for failure to use E-Verify. So an employer who becomes the target of an enforcement action will likely be presumed to have “knowingly” hired an undocumented worker if that employer failed to use E-Verify. Evidently, most employers have decided either to roll the dice or they simply don’t recognize a risk. According to Department of Homeland Security data, as of late August 2008, only 5.6 percent of Arizona employers have enrolled in E-Verify.

Non-participation in E-Verify is not an option for contractors and subcontractors of any Arizona governmental entity. The LAWA amendments passed last year require those employers to participate in E-Verify as a condition of their government contract. In fact, any Arizona governmental entity (state or any political subdivision) would be prohibited from awarding a contract if the contractor or subcontractor does not comply with federal immigration laws and E-Verify requirements. LAWA requires government entities to ensure that their contractors comply with those requirements, and to include the following terms in their contracts:

  • Each contractor or subcontractor must warrant their compliance with LAWA’s provisions.
  • A breach of that warranty is to be deemed a material breach of the contract, subject to penalties up to, and including, termination of the contract.
  • The government entity retains the legal right to inspect the papers of the contractor and subcontractor employees who work on the contract in order to ensure compliance with the warranty.

Also, employers seeking to obtain an economic development incentive from a government entity must first register for and participate in E-Verify, and show proof of doing so. LAWA further requires the Attorney General’s office to, on a quarterly basis, request a list of Arizona employers registered with E-Verify from the Department of Homeland Security. The Attorney General must make that list available to the public on its Web site.

So far, enforcement actions against employers have been anemic at best. Judith Gans, manager of the Immigration Policy Program at the University of Arizona’s Udall Center for Studies in Public Policy, prepared a study on the preliminary impact of LAWA on immigration trends and businesses in Arizona. She found that not a single superior court enforcement action was filed during the first year of LAWA’s existence. The number of complaints filed with each county attorney during that period was one or none in nine out of Arizona’s 15 counties. The Pima County attorney reported only five complaints, four of which were declined because they involved individuals hired before 2008. The Maricopa County attorney’s office stated that it does not keep track of the number of reported complaints, and those that are filed reportedly are turned over to the county sheriff for investigation. Notwithstanding a number of high profile “raids” conducted by Maricopa County Sheriff Joe Arpaio in 2008, as reported in the local media at the time, no complaints have resulted in a LAWA enforcement action to date.

Finally, LAWA’s potentially adverse impact on Arizona’s economy has been negligible, or is simply undetectable. According to Gans’ study, the current recession has had a disproportionately adverse impact on business sectors that rely heavily on immigrant labor, such as construction. Therefore, because employment of all workers in those sectors, including immigrant labor, has been hard hit as a result of the current economic meltdown, any “LAWA-effect” has been masked.

CB Richard Ellis - Best of the Best Awards 2009 presented by Ranking Arizona

Best of the Best Awards 2009: Real Estate Commercial

Real Estate Commercial Honoree: Brokerage Firms: 25 brokers or more

CB Richard Ellis

CB Richard Ellis - Best of the Best Awards 2009 presented by Ranking Arizona

Photograph by Duane Darling

CB Richard Ellis has been serving clients in Arizona for more than 55 years, becoming a dominant player in the state’s commercial real estate market. From leasing, acquisitions and sales, marketing and consulting, it has earned a reputation as a respected leader in the business community through its ability to track market trends and build relationships. Whether marketing a portfolio of properties or negotiating a complex lease agreement, CBRE brokerage professionals — more than 100 statewide — offer the most integrated array of commercial real estate services. Their approach is strategic rather than merely transactional.

That is, CBRE’s professionals can assess a client’s entire real estate portfolio requirements on a company-wide scale, delivering results and surpassing expectations.

2415 E. Camelback Road, Phoenix
602-735-5555
www.cbre.com/phoenix

Year Est: 1952 Brokers: 103
Principal(s): Craig Henig
(Arizona/Phoenix), Tim Prouty (Tucson)


Real Estate Commercial Finalist: Architectural Firms: 10 architects or more

SmithGroup

SmithGroup Inc. is one of the largest architecture, engineering, interiors and planning firms in the United States. With 10 offices and a staff of 800, Smith- Group specializes in the health, education, science and technology, office workplace, high tech and urban/campus planning markets. SmithGroup’s Phoenix office is well-known for its innovative design of the Arizona Biomedical Collaborative; the award-winning Apollo Riverpoint Center; and the recently completed Norton School of Family and Consumer Science at the University of Arizona.

455 N. 3rd St., #250, Phoenix
602-265-2200
www.smithgroup.com


Real Estate Commercial Finalist: Contractors: General, 120 staff or more

The Weitz Company

Since entering the Phoenix market in 1978, the Southwest Business Unit of The Weitz Company has built a solid reputation based on excellent service, quality work and long-term relationships. Weitz attributes its success to the company’s core values: honesty and integrity, respect for people, performance with absolute reliability, long-term perspective, and nurturing personal growth. In 2007, Weitz expanded its Arizona market by opening an office in Tucson based on its reputation for quality and service to clients.

5555 E. Van Buren St., #155, Phoenix
602-225-0225
www.weitz.com


Best of the Best Awards 2009 presented by Ranking Arizona

Arizona Businesses Succeeding

Arizona Businesses That Are Succeeding Despite The Recession Offer Lessons And Hope

Economists are the uncomfortable bearers of bad news. In recent weeks, they have been unhappily explaining that these are dark days indeed for Arizona’s business community.

But don’t tell that to businesspeople who have uplifting stories to tell amid the downdraft of Arizona’s recession.

While it’s true that Arizona’s economy is out for the count, many businesses are hardly on the ropes. They are succeeding, each in their own way.

But first, a look at that pesky economy.

It’s surprising some businesses are doing well because the experts are hard pressed to find any corner of Arizona’s economy that is untouched by the recession.

“I wish I had something positive to say,” says Tim James, a professor of economics at the W.P. Carey School of Business at Arizona State University. “It’s quite difficult to see any sector doing well … What could possibly happen to make things worse than they are? I can’t think of anything.”

James does point to one exception — discount stores such as Wal-Mart, Costco and Sam’s Club that sell the necessities of daily living. They are prospering, but “nobody will be immune to any of this at the end, as even the Wal-Marts will suffer,” James says.

Also apologetic is Marshall Vest, an economist at the University of Arizona’s Eller College of Management. Asked if there is any sector of the state’s business community that is well positioned and poised to take advantage of the recession, Vest responds, “The short answer is I don’t know. Most industries are feeling the effects of the recession.”

Yes, it’s tough out there. But there are success stories and those businesses offer lessons on how others can ride out this rough economy.

When Robert Meyer joined Phoenix Children’s Hospital in 2002 as president and CEO, the nonprofit medical center for acutely ill pediatric patients was juggling several urgent problems. Arizona was in a recession, a shrinking investment portfolio had eroded the hospital’s capital base, cash reserves were dangerously low and the organization was facing a $46 million loss for the year while incurring the cost of moving from its location within another Phoenix hospital to its own free-standing building at 19th Street and Thomas Road. Meyer, who had been through five prior recessions in health care, focused on two areas — internal operations and strategic planning — and took steps that got the hospital back on its feet.

The hospital had no internal billing-and-collection procedures, no budgeting system and a few outsourcing contracts that were axed because they offered little value in Meyer’s eyes.

“We developed our own patient accounting department, which yielded tremendous improvement in our ability to bill and collect money,” Meyer says. “We started a budgeting system. The hospital had done a lot of outsourcing with a lot of companies and some of them were terminated.”

Meyer wanted a short, simple strategic plan that covered 18 months to two years — as compared to hospitals’ standard five years — and looked outside the health care industry for a sound planning tool. He found it at The One Page Business Plan Company in Berkeley, Calif. Soon, each of the hospital’s major programs had a one-page plan within a relatively brief strategic plan, and progress was tracked online against milestones.

The payoff came as early as 2003, when the hospital generated $3 million in net income. With its books in the black, the hospital took steps in 2004 to cement future success by implementing several new clinical programs. Profits grew to $49 million in 2007.

In today’s recession, Phoenix Children’s Hospital’s primary business offers opportunities for new growth. Meyer says the number of children in the Valley is expected to increase from 900,000 in 2003 to between 1.5 million and 1.7 million in 2025. To meet the needs of its growing patient base, the hospital began rolling out a $588 million main campus expansion in 2008 — only six years after nearly succumbing to financial ruin.

Paragon Space Development Corporation, a small aerospace engineering and technology development firm in Tucson, is succeeding in tough times because most of its business comes from NASA.

“We’re a little bit out of the consumer economy’s ebb and flow,” says Taber MacCallum, CEO and chairman of the board. “What we are going to feel is the federal government’s response to the recession, not so much the recession itself.”

He expects his company’s work with NASA will continue. But things weren’t so rosy during the last downturn. Founded in 1993, Paragon initially booked more commercial than government work and was hit hard by the 2002 recession. It began playing out a variety of business what-ifs to help it prepare for bad times, and business has grown 30 percent to 50 percent annually the last three years.

“You’ve got to create your business model and then run good-and-bad scenarios and make sure you don’t cut so deep that you can’t respond to the recovery,” MacCallum says. “We call them down-and-out and milk-and-honey scenarios. You can do that with a small retail shop and you can do that with a large industry.”

Taber recommends taking advantage of opportunities that arise when other businesses downsize or close.

“This economy has presented a tremendous opportunity for us,” he says. “We’ve been able to pick up new employees and manufacturing equipment from other companies that have had to sell.”

There is also a beacon of hope in the rubble of Arizona’s mortgage industry. On Q Financial, a Scottsdale-based mortgage banking company, is growing as it serves buyers of condos and single-family homes and arranges residential property refinancing. In 2008, it opened new offices in Phoenix, San Diego and Seattle, and its Valley staff grew from 20 in 2007 to 50. In business since 2005, On Q zeroes in on what it can control, says John Bergman, president and owner.

“Every day, month and quarter, we focus on improving things internally that we can control,” Bergman says. “We can’t control the market.”

On Q strives to hire talented operations staff and constantly troubleshoots internal systems, processes and timelines. Business owners must have a firm grip on their financial performance, Bergman says.

“Every month, have financials reported to you in a manner you can use,” he says. “Look at them. You can always adapt and change according to what’s going on.”

On Q also pays close attention to customer service and market share. “We are really aggressive in offering great products to the consumer, and we negotiate for good pricing for our clients,” Bergman says. “No matter what the market does, there is always an opportunity to take a bigger piece of the pie.” Bergman says it’s critical to keep employees energized.

“Let them know that the tougher things get, the better things are when they turn around,” he says. “So you want to focus on the positives in your industry.”

Reeling financial markets commonly create a phenomenon known as the flight to quality — money moves from the stock market to the safety of bank accounts and certificates of deposit. Such is the case with the current recession, and Northern Trust Bank has seen a resulting increase in deposits and new banking relationships, which in turn has generated increased lending.

“We have, in many respects, been in a very nice situation when there has been a flight to quality in the banking business,” says David Highmark, chairman and CEO of Northern Trust’s Arizona bank. “The flip side during this liquidity crisis is that our loan volume is two to three times our normal amounts. Our earnings will be very strong, because today we are collecting so many new relationships that will materialize into new earnings down the road.”

Highmark emphasizes the importance of successful companies staying focused on their core business, a theme also repeated by Paragon and On Q Financial. Northern Trust’s primary business is lending to and managing assets for wealthy individuals and companies.

“We have never wavered from that core business,” Highmark says. “If there is a formula to survive in bad times, in our case — and I think in general in all industries — it is sticking to your knitting. Don’t vary from your core business.”

Bad business partners

What To Do When Bad Business Partners Happen To Good People

“He is robbing you blind.” Business owners are never emotionally prepared to hear these five words, but they should be poised for action to protect their own interests and those of their companies’ when business relationships turn hostile.

Recently in Arizona, the owner of a residential property rental company found this out the hard way when she was told by a former employee that the manager of her company’s 150 properties was stealing from the company. A widow nearing retirement, she had made a series of business mistakes, including giving the manager stock in the company without proper legal documentation, as both a reward for past service and to motivate and compensate him for future work. The once loyal employee began to take control of the owner’s $25 million investment under the guise of “handling the details” of the business. He took control of the accounting software program, the company credit cards and kept details from the owner by misinforming her of the time for meetings with the company accountant. She was dumbstruck when she received the phone call from the former employee, but, on reflection, it all made sense. Her business acumen for finding deals on distressed properties and turning them into rentals had not prepared her for the complexities of dealing with a business divorce. As a business owner you need to protect yourself. The following provides some tips you should keep in mind if you believe a business divorce is imminent.

Gain Control
When there is a shift in the business relationship, as owner your first step should be to get back your position of power. You will need to separate yourself immediately from the person causing the conflict in your business. In this case, the property owner fired the manager, changed the locks on the doors, cancelled credit cards and changed passwords to all the computer systems. You will need to take this even further to protect your intellectual property and files. Talk to your IT and file room staff about securing access and tracking of information and control of passwords.

If you are fortunate enough to have your company running well today, this is the perfect time to make sure confidentiality policies are in place and have a lawyer review your company documents. It makes more sense to manage risk and resolve conflicts before they start to touch your bottom line.

Stop Talking
It is tempting to unload your frustrations on your accountant, your tax advisor, other employees and even your next door neighbor. But the truth is those comments could come back to cost you money, leverage and possibly your business reputation. While there are some exceptions, as a general rule, conversations you have with someone, other than your lawyer, can be used in court. Make your attorney your sounding board, confidant, champion and warrior. What you tell your attorney is protected by attorney-client privilege. It is the bedrock of your right to have effective counsel; without it, lawyers could not effectively represent their clients.

Keep Original Documents
This property owner had a bad habit of giving away original documents. When it came time to organize her case, this made the task even more challenging for attorneys, expert witnesses and even business advisers. Making a copy of a document is fine, but make sure you keep the original. Be sure to maintain the integrity of original documents by keeping them free of extraneous handwritten notes. If you write on these documents, you may make your case more difficult. If you want to make a note about a business matter, grab a Post It note.

Hire a Lawyer
You may know your business, but your expertise is in the company, not the law. A good lawyer needs to be the captain of your ship as you navigate a business divorce. Your lawyer may recommend a business adviser to get your company back on track. While this is a “divorce” of sorts, it isn’t the job for a family law attorney; you need an experienced business attorney who has dealt with breakups in the business arena. Get referrals through people you know in the business community, professional organizations or your local bar association. Do not be afraid to ask a lawyer if he/she has ever done this type of work. In some cases, a team of lawyers may be necessary. You may need experience in several different areas to get the matter resolved.

Turning the Tide
How did the widowed property owner fare with her business on shaky ground and her future retirement threatened? Through a mediation process, she was able to regain control of her company and tocarve her co-owner out of the business. The woman is now back in a take-charge position, buying and managing properties. Most importantly, her future is in a more secure place.

Like a marital divorce, a business divorce is never easy but, once resolved, you’ll be able to run the company instead of letting bad employees or unsuitable business partners run you.

Leon Silver and Dan Garrison are shareholders at the law firm of Shughart Thomson & Kilroy. They lead the firm’s Business Divorce team. They can be reached at 602-650-2000.