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These articles by Barbara Fox were prepared for the May 12, 2004
issue of U.S. 1 Newspaper. All rights reserved.
Life in the Fast Lane
Nonprofit organizations generally rent space rather than own their own buildings, because they don’t have enough money to buy – at least that is the general wisdom. But in these days of higher rents and plummeting mortgage rents, the Regional Planning Partnership bucked the trend.
The research and advocacy group vacated its leased space at an old farmhouse at 870 Mapleton Road – right at the corner of Route 1 – and moved to a house that it purchased opposite the State Capitol building in Trenton. Similarly, the Princeton Regional Chamber of Commerce just bought its own building on Vandeventer Avenue in Princeton (U.S. 1, May 5). Both organizations moved last month, and both hold their "office-warming" open houses on Thursday, May 20. RPP invites guests to 118 West State Street from 3:30 to 5:30 p.m., and the ribbon gets cut at the Princeton chamber at 4 p.m., followed by refreshments at Triumph at 5 p.m.
RPP’s move involved two big changes: deciding to buy rather than lease, and deciding to move to Trenton. It actually saved money by spending $225,000. "On Mapleton Road we were paying $1,700 a month, and our new mortgage is slightly lower than that," says Ann Brady, vice president of RPP, the planning group that studies the best ways to use land. A Maryland native, she is a 1979 alumna of Guilford College.
The Mapleton Road property is owned by Rob Lyszzarz of Properties Unlimited, who has the State Road headquarters for 23 Re/Max offices. It consists of two structures; the larger one was formerly the home of Short & Ford Architects, and U.S. 1 Newspaper used to occupy RPP’s space.
"We were increasingly seeing the need to be in an urban area," says Brady. "Part of our mission is to use land more efficiently, and it is important to us to be in a place that is pedestrian friendly, public transportation friendly, and easier for car pools." One of the six current RPP employees can now walk to work, and others may be taking public transportation.
"The way the building is set up now," she says, "we have more space than we need for current staff and are hoping to rent some space out, and we hope to hold meetings here in Trenton with decision makers."
The building’s history includes having been occupied by Benecard Services, the company started by former gubernatorial candidate Douglas R. Forrester, and by the Office of Legislative Services. The original price for the four-story house was $269,000 and RPP paid $225,000 for 5,000 square feet plus six to eight parking spaces. Anne LaBate of Segal Commercial Real Estate represented both the investor/owner Joe Pintinalli of Quakerbridge Associates and the buyers.
RPP will occupy part of the first and second floor, amounting to 2,500 square feet, and hopes to lease some of that space. The top two floors need rehabilitation, and RPP will stage a capital campaign to do that, as well as to pay off the $200,000 mortgage, held by Sun National Bank with help from the New Jersey Economic Development Authority.
"I always push people to look in Trenton," says LaBate. "It’s a central location, and the transportation options are extraordinary – a 10 to 15 minute walk to the train station. Since the Marriott moved to town, we have been inundated with investors and others looking for opportunities."
Brady had started out looking for rental space. "Being a nonprofit, we were in the mindset that we don’t have the resources to buy," she says. "But because of the floor plans in Trenton, the per square foot rental price was comparable to what we were paying in Princeton. Anne LaBate said, almost off-handedly, ‘if you bought the building you could reduce your numbers.’"
When RPP changed its name from MSM (Middlesex/Somerset/Mercer Regional Council), it had considered buying its own space. "Years ago our president saw a building on Route 1 but it wasn’t the right time or the right place," says Brady. "But now, with lower interest rates and the Trenton location, the board overwhelmingly supported our decision."
"By changing our name, we still want to collect data on our MSM region and use it as our laboratory but so many of the things we comment on are statewide," says Brady. "We are developing tools and strategies that can be used to change outcomes on land."
Among these tools are the Goal Orienting Zoning (GAZ) model, which helps officials forecast what the effects of buildout will be in time to get the zoning changed. Plan Mapping is a technique for taking plans that different interest groups have made for a particular location and layering them to see where the overlap is. MSM did this effectively in Trenton. The third tool, the Regional Action Plan, is a way of looking at a larger region, to establish goals for what it should look like in the future, and then establish strategies to achieve those goals. This tool has been presented in Somerset County and used in Mercer County.
For RPP to have its own building, Brady says, signifies that "we’ve been around for 35 years, and we are here to stay."
People make conscious or unconscious choices whether to work for a large corporation or a smaller business. If they don’t "go corporate," they might choose what can be called a "lifestyle business," a company with little process, structure, or goal orientation. "People are there because they prefer that lifestyle, and they do not have to conform to corporate policies," says Douglas W. Crisman, president of Oldhorses Inc. at the Carnegie Center.
The "lifestyle" term can also reflect the culture of the owner. But often successful entrepreneurs are frustrated when they try to grow their companies. Many small businesses never grow past $5 million, says Crisman, and it’s not because the owners are not ambitious. Often they have gaps in their skill sets and have not been able to pick the right people to fill the gaps to push them to the next level.
Sometimes they run into trouble when they try to sell their business, Crisman says. "They find that there is nobody to sell it to, or that the price would be too low."
"Also, sometimes the vision that they had when they started, isn’t serving them. They find themselves working for a salary as opposed to being an investor."
Crisman has geared his consulting business, Oldhorses Inc., to help the entrepreneurs with lifestyle companies build the value of the business and regain their original vision. He shares space in the Carnegie Executive Center with his wife, Grazina Crisman, who does productivity coaching and professional organizing with her firm the Productivity Shoppe (U.S. 1, September 24, 2003).
Crisman grew up in Boise, Idaho, where his parents worked in the newspaper business and his father, at one point, owned a newspaper. He went to Boise University, Class of 1974, and worked at a bank, a computer software service bureau for automotive and financial industry, and then for a venture capital company overseeing technology firms. He met Grazina at Tandem Computers, when she managed the technical analysts and he managed the sales force for the banking group. He was also regional manager for Microfocus, a Y2k conversion; worked as president and CEO of Cognetics in 1998 and 1999, and bought and sold Omicron, which offered organized networking effort for IT managers.
Even before he started Oldhorses, he says, he envisioned it. "I had the mindset of an investor. I had the money, the time, the desire, and I knew know what my vision was." There were lean years "when I could have been making five times the money I earned that year, but I knew the payback would come when I reached my vision." The tagline: "We work with the owner to make the business work for the owner, not the owner work for the business."
As part of this vision, while working for other people, Crisman codified his lifelong study of motivational and business methodologies, including those from gurus like Peter Drucker, Stephen Covey, and Michael Gerber, and scaled them for small business. "It is amazing that no one else has done it this way – rapidly focusing and stabilizing a company by bringing three disciplines – coaching, consulting, and project management – into one. It surprises even me."
In 2000 Crisman started Oldhorses by working for only one client at a time. In October, 2003 he began to roll out the methodology for many businesses and went from two clients to eight clients. About six people work directly with clients to "transition" businesses, and he employs a number of consultants.
Using the term "intervention," Crisman describes how his firm comes in "in a massive way, with experts in every field, to fill the skill gap. We capitalize on the product knowledge that the owner has and add high level professional management into every level of the business, and this jumpstarts the business. We call ourselves transition partners, to transition the owner and the business and remold it to the original vision that the owner had."
Oldhorse clients generally have fewer than 25 employees, are worth under $5 million, and most are worth from $1 to $2 million. Companies smaller than that do not have sufficient "bandwidth," Crisman says, to afford his fee. His typical client is a $2 million business with 15 workers including one or two salespeople, in which the employees report to the owner, not a senior manager.
"I have had direct experience in that side of the business and have worked with small businesses, start-ups, and large corporations," says Crisman. His definition of a start-up is a company funded by somebody other than the owner, probably by an angel or a venture capitalist. Start-ups are mini corporations, he says, because there is pressure to perform applied by the outside board or an outside set of investors. "In contrast, the entrepreneur has nobody to report to but themselves."
"Having lived in all three areas I have seen the differences and the struggles that managers in large corporations go through, versus entrepreneurs and start-ups. I chose to help small businesses because I have started a couple myself, and I understand what it is like to have the mortgage on the line."
"Some people had a goal and can’t get past a plateau. They were creating more jobs but making no more money themselves. They had added more volume and more people but were not creating any wealth to cash in on in the future," says Crisman. His clients were frustrated when they realized that they could be making the same salary as a consultant – without the aggravation of running the company.
"A remedy is to identify where the leverage is that we can capitalize on, and focus on that leverage, and build it out. In this size of business, you have to generate more sales without generating more overhead. So you look at your leverage with customers, your market, your product, and your intellectual property – you refocus that and improve the sales process," says Crisman.
Crisman claims that in the first year with any client he typically achieves 25 percent growth. Quick progress can be made simply with sales training. "Most of these owners have never been taught the skills of selling. We are never the subject matter experts, but we know how to sell and communicate any company’s value process."
"We work on an opportunity basis. We are very much like a venture capitalist except we don’t invest cash, we invest time, and we don’t take an equity position – we take a percent of the sales," says Crisman. He says his fee schedule is small business friendly. "We align ourself with the way the small business operates. We get paid when our clients get paid."
Crisman’s tactics: He meets with the owner for a two-hour lunch and then for an all-day planning session to identify specific initiatives that would make a difference in the business. Those first meetings, at no obligation, help determine whether the owner is ready. "Whether or not we work together after these meetings, the owner ends up with a concrete high-level plan on what would help them make their business work for them."
After that, Oldhorses takes a percentage of the increase, which varies with the risk. Crisman says that, so far, all his clients have renewed their contracts until they achieved their transition goals: "We measure what we do in specific ways, and we can tell what actions produced what results."
Cliff Hallberg, owner of Morristown-based ITG Competency Group, is a satisfied Oldhorses client who reports growth of 25 to 30 percent annually after no growth in the previous decade. Hallberg’s company builds and sells off-the-shelf "competency models," analyses of what skills are needed for what jobs, which help corporations decide how to spend their training budgets. "I don’t know anybody in corporate America who is not working 60 hours a week," says Hallberg, "and with all the downsizing, having the right skills is more important than ever."
An electrical engineer from Pratt (Class of 1966) with an MBA from Columbia, Hallberg has eight to ten full-time equivalent employees, and his most recent contract was for $120,000 to the Bank of America (www.itgcompetencymodels.com).
Hallberg credits Crisman with helping to divide his former two-partner business into two businesses. "He helped us recognize what I knew in my heart was true, that we should run the businesses separately." Crisman also helped him to take his business virtual.
An ironic twist: though Hallberg’s product is measuring skills for a specific job, Crisman discovered that Hallberg lacked one key skill needed to break his business away from the plateau. "In my job description," says Hallberg, "it should have said that sales management was a critical competency. He helped us put in performance measures and goals, and he did a great job helping us managing the sales people."
"When Cliff and I first talked," says Crisman, "his company’s lack of sales management skills was not as evident as it was when sales started to move. Often people don’t know what they don’t know,"
Crisman’s "Aha! moment" came last fall when he discovered he could replicate himself – "I could break down the tasks that I do and delegate them, so other people could deliver the services as effectively as when I did it myself."
So does Crisman take his own advice in growing his business? "I am following the same methodology as with my clients, and I use my tech chair (Marty Feinberg, based in Conshohocken, Pennsylvania) as a sounding board and a coach." He’s waiting to write "the book" until he collects more examples. "I like to only preach what I have done."
About that name: It implies "lots of experience" but won’t people think Crisman and his cohorts are ready to be put out to pasture? "I was going to change the name but I had such a positive response in the market that I decided to keep it," he says. "We are willing to not take it all too seriously. Our results speak for themselves."
Unmanned aerial vehicles and TV-guided cruise missiles for granted have their roots in the 1940s, says Alex Magoun, executive director of the Sarnoff Library. During World War II Vladimir Zworykin and David Sarnoff of the Radio Corporation of America (RCA) helped to build the first UAVs and TV-guided missiles.
The David Sarnoff Library co-hosts "From Zworykin to Kosovo: How RCA’s World War II Military Television Development Shaped Modern Warfare," a multimedia presentation by Maurice Schechter, on Friday, May 14, at 7:30 p.m. in the Sarnoff Corporation’s Auditorium on Fisher Place. Co-sponsors are the IEEE and the New Jersey Antique Radio Club.
Also on display will be the Larry Boyer collection of RCA’s first radios, transistors, and televisions. Boyer, who worked at RCA Labs from its opening in 1942 to his retirement in 1980, he collected and restored these products and has donated them to the Sarnoff collection.
The library will also be open on Saturday, May 15, from 10 a.m. to 4 p.m. for tours and additional demonstrations of the WWII television system, a new 45-rpm Victrola exhibit, and the Boyer collection.
Schechter will demonstrate the only restored television system used during the war to guide these weapons and show archival footage of the developmental TV bombs and filmed recordings, or kinescopes, from bombing runs. As the chief engineer for DuArt Film and Video in New York City, Schechter has spent nearly 20 years researching this subject from the proving grounds of Nevada to the National Archives.
Four companies with offices in Forrestal Village – Checkspert, CTG, MultiModal Applied Systems, and Quantiva – will be featured on walking technology tour sponsored by the New Jersey Technology Council on Friday, May 14, at 8:30 a.m. Titled "Economic Development Expectations Along Einstein’s Alley," the event includes a panel discussion with Bill Goold of Rush Holt’s office and Joseph Seneca, chairman of the New Jersey Council of Economic Advisors. Cost: $20. Call 856-787-9700.
Hawk Warehouse, a distributor of children’s accessories, will expand from New Brunswick to 211,000 square feet at 152 Ridge Road. Hawk bought the facility from Knickerbocker Industries and was represented by Joel Lubin and Chuck Fern of Binswanger Klatskin.
Forty people, nearly one third of the 150-person staff at the headquarters of Berlitz in Alexander Park, were given their walking papers on Wednesday, May 5. The layoffs were reportedly part of a reorganization effort resulting from the decline in language lessons in all areas except Asia.
For three years Berlitz has been a wholly owned subsidiary of Benesse Corp., based in Okayama, Japan. In 1997 the company moved its editorial and production headquarters from England, to 70,000 square feet at Alexander Park, joining the publishing and translation group, which moved from Manhattan. In 2002 the owners sold the publishing assets to Langensheidt, the Munich-based dictionary company.
MC Squared has changed its name to MCS Global Inc. and moved from Suite 1385 to Suite 1014 at Princeton Meadows Office Center. With offices in Virginia, Virginia, and Iowa, the software consulting firm is an IBM business partner and offers a wide range of services.
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