NSS is co-sponsoring four CEO Seminars around the theme of “Moving Forward: A Roadmap to Growth and Best Practices in 2010″ .  The first one was successfully held March 23 at Furman Gregory Deptula.  Our next seminar is scheduled to be on Tuesday, June 15 and we are currently formulating the agenda based on the feedback from the CEOs in attendance at the March meeting.

NSS provided this hand out:

Flexibility

Keep your company nimble, lean and focused.  Just as large companies have divested non-core competencies, carefully consider which aspects of your business should remain fixed costs and which should become variable.  This keeps your business capital efficient and brings greater flexibility in moving your business forward.  Consider outsourcing non-core functions such as HR, finance, legal, sales and marketing.

Focus

Take a look at your lines of business in product/services and analyze closely which lines are using what resources.  If you have a product that takes 70% of your resources and represents 20% of your revenue, you have a problem.  Evaluate your customer/client revenue streams and determine what portion of total revenue each contributes.  Customers/clients that make up more than 30% of total revenue may in fact be a danger to your long term stability.  Stay diversified and avoid relying on one or two big clients.

Working Capital

Cash is always King.  In this recession, keeping cash flow positive has been harder and harder to achieve, especially for small businesses.  Where once monthly cash flow checks were adequate, today a daily/weekly Financial Dashboard is a necessity.  Financial Dashboards give you key financial indicators such as accounts receivable and inventory turnovers, working capital and current account ratios. Know at all time what your 6-month cash flow looks like and what action you may need to take.  Look beyond the ratios to get a regular pulse of industry trends and changes in technology.  Keep an eye on what the competition is doing, and check their press releases, stock prices and other activities that could impact your business negatively.

Equity/Debt Financing

Equity investors are still in flux.  With the financial meltdown, they have become somewhat more risk averse, leaving a bigger capital gap.  However, many are also making continuous investments and new, smaller funds are being created.  Bootstrap as long as feasible and build your revenue streams or user base.   This will enhance your business valuation over time.  Once you decide to raise funds from  equity investors, take the time for due diligence and investigate what type of equity funder would be the right fit, understand the investor’s needs and interests in terms of size of funds needed, industry expertise and support.

On the debt side of financing, try to diversify your banking relationships, the old ‘do-it-all’ approach is no longer an optimal solution.  Many local banks are starting to lend again, but mostly to businesses with strong balance sheets. There are various financing solutions to consider such as Accounts Receivable, equipment and real estate financing. Consider carefully all details in the term sheets and other agreements and evaluate the different options with extensive cost/benefit analyses.

Opportunities for Growth

With robust financial planning, a recession can provide opportunities.  Growth may not be achieved the same way as before, as direct sales may be impacted by the economy.  Consider the option to grow via merger or acquisition of a:

• technology  that brings greater efficiencies
• business with additional products diversifying your product line
• business with different distribution channels

Even a small company can gain greater market share, but this is only accomplished with a strong financial strategy and a solid understanding of managing and balancing risks.  If you are too risk averse you might miss a valuable opportunity and if you are too risky you may compromise the business.

Financial Strategy

Now more than ever you want to revisit your long term strategy.  In this current economic climate it is essential to have multiple roadmaps and be ready to take detours.  Being a productive CEO or business owner gives you a competitive edge.  Every downturn or recession brings opportunities; know what they are and plan accordingly by developing cost/benefit analyses of your options and revisit them regularly.

2010 will still bring some uncertainties and having the best team of experts will make it a better ride.  Have a 6-month, 18-month and 36-month strategy with milestones and execution points you want to accomplish. Share your short-term and long-term goals and objectives with your employees and create a culture where problem solving, networking and business development are everyone’s business.

We can help!

We thank you for attending this first of four seminars.  If you have any questions or specific issues around best practices in finance and growth for your business, we would be delighted to provide you with a consultation free of charge.  Please contact Rudi Scheiber-Kurtz, CEO of Next Stage Solutions, Inc. at 617-449-7728 ext 704 or email at scheiberkurtz@nextstagesolutions.com to set up an appointment.

We are pleased to announce the first of four

CEO Seminars  |  Tues March 23, 2010

7:30am -9:00am, 75 Federal Street, Boston

(offices of Furman Gregory Deptula)

RSVP: Rudi Scheiber-Kurtz at 781-929-9125 or scheiberkurtz@nextstagesolutions.com

The “new” economy brings its own set of challenges to companies who want to grow or plan an exit.

In the first of 4 seminars for CEO’s in 2010, we will begin by focusing the discussion on various ways of balancing the risks in our businesses.

• How can I build out infrastructure and create a model that is both flexible and adaptable, one that can constrict and expand with minimum costs?
• What value can I bring to my business by outsourcing any non-core competency to keep agile and nimble?
• What are the next-step tools and solutions in how I can achieve desired growth in a recharged economy and preserve cash with a conservative budget?
• How do I finance growth in today’s economy?
• What innovative strategies can I adopt to increase value in my business that may not involve raising capital?

Join us for a 90-minute interactive dialogue and take back valuable insights from other fast growth CEO’s.  Learn tools, tips and trends to help you navigate in this new economy.

Attendance will be limited to allow more in-depth and interactive discussion. Future seminars will focus on specific topics such as financing, sales and marketing, legal, partnering, and exits.

Why you should attend:

• Network with other CEO’s and gain visibility to best practices in the marketplace today
• Develop new partnering strategies for growing your business
• Learn how to avoid pitfalls of outsourcing key aspects of your business
• Gain critical insights into key legal, financial, and human capital issues in 2010 that will impact your business

Location: 75 Federal Street, 9th Floor, Boston, MA at the offices of Furman Gregory Deptula

Time: 7:30am Continental Breakfast

Program: 7:45am – 9:00am

RSVP: Rudi Scheiber-Kurtz at 781-929-9125 or scheiberkurtz@nextstagesolutions.com

Sponsored by:

Mass High Tech announced the names of 11 women from the New England tech community who will be recognized in March as the 2010 MHT Women to Watch. This year’s honorees will be profiled in the March 17 issue of Mass High Tech and will be recognized at a special event on March 19 (read more)

NSS congratulates the 11 outstanding women!

The 2010 honorees, their titles, industries and locations are:

Marcie Black, Chief technology officer, Bandgap Engineering Inc., Photovoltaic systems, Woburn

A.G. Breitenstein, Vice president and general manager for provider markets, Humedica Inc., Healthcare IT, Boston

Catherine Crawford, Senior technical staff member, IBM Corp., Supercomputers, Bedford, N.H.

Lauren Crews, Technology coordinator, Raytheon Co., Defense, Andover

Elizabet de los Pinos, Chief executive officer, Aura Biosciences Inc., Biotechnology, Cambridge

Michelle Dipp, Vice president and head of the U.S. Centre for External Drug Discovery, GlaxoSmithKline plc, Biotechnology, Cambridge

Jill Drury, Associate department head, The Mitre Corp., Robotics, Bedford

Candace Fleming, Chief executive officer, Crimson Hexagon Inc., Social networking, Cambridge

Katie Hall, Chief technology officer, Witricity Corp., Electronics, Cambridge

Dava Newman, Professor of aeronautics, astronomics and engineering systems, Massachusetts Institute of Technology, Aerospace, Cambridge

Livia Racz, Division leader for advanced hardware development, Charles Stark Draper Laboratory Inc., Electronics, Cambridge

Last month the Wall Street Journal published an article For Rent: Chief Financial Officer by Raymond Flandez, commenting in how more and more firms are outsourcing this high level function of management. For businesses small and large, especially companies that want to grow, the finances do get more complex. He points out that many of these ‘Rent a CFOs’ are also Certified Public Accountants.

I agree wholeheartedly with Flandez’  assessment  that an outsourced interim or part-time CFO is a capital efficient way to access this expertise and an outsourced CFO can be more objective and give a reality check. I also agree that many of the CFOs are indeed CPAs and this is partially due to the Sarbanes-Oxley Act of 2002 (SOX)  that has driven businesses and their CEOs more to the compliance and technical side of finance enforcing the common belief that if you have a controller and an accountant your financial needs are covered.  That may apply to life style companies who do not intend to grow but simply run a sustainable business.

From this juncture, however, is where I begin to differ.  A company with expansion and growth in their forecast, the paradigm has to shift drastically from technical to strategic. In fact, not recognizing the importance of strategic finance and solely relying on your controller’s risk aversion, you may be holding your company back from that growth.  Here is why I think so.

For a fast growing company, the financial spectrum has to be broader and therefore more complex as pointed out by the author of the WSJ article.  You want to consider a broad based and strategic CFO, one that picks up where the CPA or controller leaves off.  The CFO is your business partner and brings a strategic organizational mind set to the discussion and understands the importance of mapping out the corporate strategy into multiple roadmaps.  Given uncertain economic times, this is more important than ever.  Finance for emerging businesses brings a complexity that is more than accounting and number crunching.

The CEO needs to fully understand the financial ramification and bottom line each decision triggers. SOX compliancy has driven us too far towards the tactical aspect of finance forgetting the importance of looking forward, checking your Financial Headlights.  The CFO plays an important role acting as conduit to growth and walking the fine line between the risk-averse controller and the visionary CEO.  Your future CFO needs to have average appetite for risk, not too little and not too much, understand how to translate the corporate strategy and be a true value creator and not a gatekeeper of growth.

Rudi Scheiber-Kurtz, CEO
Next Stage Solutions, Inc.

Swiss consul general Pascal Marmier has helped transform the Cambridge consulate into a leading-edge diplomatic outpost.    (Pat Greenhouse/ Globe Staff)

SwissNex is an innovative idea of bridging technology and science between two countries – the USA and Switzerland.  As a Swiss Native, I have been very involved in the various activities, particularly with the Venture Leaders.  These are 20 start-ups that each year get chosen by CTI in Switzerland to visit Boston.  Pascal and the SwissNex team host this group and bring Boston area coaches and experts in to provide feedback around fund raising, scaling and entering the US market.

The Boston Globe had a write up last month titled “Diplomacy opens a portal to profit- Boston’s consulates focus on business“  talking about the dynamic consul general Pascal Marmier and how other consulates are now creating similar venues. Pascal is a new breed of consuls, with energy and  innovative thinking abound. He is also the networking king par-excellence.  We are very lucky to have him as our consul general.

To brag just a little more, Switzerland ranked #1 in Global Competitiveness by the World Economic Forum.  Checkout the report:   The Global Competitiveness Report 2009-2010

Rudi Scheiber-Kurtz, CEO
Next Stage Solutions, Inc.

Commonwealth’s Privacy Regulations Revised and Simplified

Citing concessions to the burdens placed on small businesses, on August 17, 2009, the Commonwealth’s Office of Consumer Affairs and Business Regulation (“OCABR”) again revised the so-called identity theft or privacy regulations, further extending the date for compliance until March 1, 2010.

The major conceptual change in the revised regulations is their new emphasis on a “risk-based approach” to implementation.  In plain terms, a company now has the flexibility to scale its efforts  in implementing the regulations based on “the size, nature of its business, the kinds of records it maintains, and the risk of identity theft posed by its operations,” as summarized by the OCABR.  Where the prior version of the regulations indicated that compliance would be judged (assumedly at the time of enforcement) in light of the relative business size along with the amount and accessibility of personal information, that scalability has now shifted to the demands required of a business in initially implementing the regulations.  According to OCABR, the “[n]ew language in the regulations recognizes that the size of a business and amount of personal information it handles plays a role in the data security plan the business creates.”

The revised regulations postpone, again, the date for compliance an additional two months (formerly the deadline was January 1, 2010).  The plain language of the remaining changes to the regulations tighten, focus and simplify language, but do not appear to materially change the process for businesses.  Each company must still evaluate its use and storage of personal information, create a comprehensive written security plan or plans, implement feasible safeguards (including employee training and reasonable protection of electronically stored and transmitted information), and monitor and report breaches and unauthorized disclosures – although each phase may be moderated to the scale and nature of business operations and volume of protected information.  A public hearing on the revisions will be held by OCABR on September 22, 2009, which may result in further updates.  Look for additional alerts throughout the fall.

For more information on these topics, please contact:

Karen A. Whitley, Esq. 617-226-3402 : kaw@hanify.com

Kathleen E. Cross, Esq. 617-226-3433 : kec@hanify.com

This alert may be considered advertising under the rules of the Supreme Judicial Court of Massachusetts.  The information in this alert is provided for background purposes and should not be considered legal advice.  Hanify & King, Profession Corporation © 2009

NSS has joined AIM as a corporate member this week.  In an earlier blog I wrote about the BuyMass.org website, the Massachusetts online business-to-business network.  AIM created this website along with the Commonwealth of Massachusetts.  It is all about creating jobs and bringing economic opportunity to Massachusetts.

We believe that NSS offers a unique value to emerging businesses of the Commonwealth with our CFO on Demand model.  Our CFO team is highly experienced not only in the arena of finance, but also in operations and management.  Today’s CFO needs to provide more than the governance piece of finance by bringing the organizational mind set to the table. We understand how to grow companies and hope to be of value to the other AIM members.

Rudi Scheiber-Kurtz, CEO
Next Stage Solutions, Inc.

Leadership skills and tools are more important than ever in troubling economic times.  Indeed we do not “want to waste a good crisis” as John Chambers, CEO of Cisco Systems claims!  Ruth Gerath, President of Gerath & Co. and an NSS Ambassador, provided us with a thought provoking piece on leadership and how we might lead in uncertain times.

Enjoy…

The Emperor has Know Clothes

Sometimes we look for something new when the old is what would work best.  I was thinking about that, and about writing this article on leadership, when I heard a piece on the radio about a fellow in England, a consultant, who promises his clients that at the end of his team-building program their employees will be so comfortable with, and trusting of each other that they will happily work together in the nude.   The host was interviewing a business owner who had hired this man.  Okay, I’ll bite, I thought as I shoved my skepticism aside.

The owner said that he had been looking for a way to get his team to work more collaboratively in order to generate new ideas for weathering the current financial storm.  I imagined his entire staff in a conference room for two days, knowing what the end game was, and wondering how fast they could contract swine flu.

The host asked the obvious, burning questions:  “So, did you actually come to work nude at the end of the program?”  To which the man responded that indeed he had.  “Did you drive to work nude, or change at the office?”  Turns out the brave fellow left his home, got into his car, and drove to work in the buff.  “Were you concerned about others seeing you in the car?” inquired the host.  He was not because he left the home very early, missing the morning commute traffic. Somehow that felt like cheating to me but I decided I should give the guy a pass – perhaps I was being a bit too picky.

By this time I’d forgotten all about my annoyance at the lack of business impact questions and was going straight down the path with the host.  What did this guy look like?  Was he in shape?  Would it be more daring a deed if he weren’t?  What did his employees look like?  How many men versus women were in the group?  Did they look at each, or just pass in the halls, eyes downcast, slinking to their desks when they arrived sans clothing?  Did they bring towels to sit on? 

Unfortunately for my voyeuristic curiosity, the host didn’t go there and I was left to create a scene in my mind – which I did.  In fact I created several.

Personally, I would have found a good reason, like surgery, to avoid that particular team-building experience.   But the larger point is that finding effective ways to deal with challenges is a hallmark of great leadership, and one need not take extreme measures to make an impact.

A current example of strong leadership in this economy is Cisco Systems’, CEO John Chambers.  In a July 28^th, 2009 interview with Michael Malone of The Wall Street Journal Mr. Chambers said, “You never want to waste a good crisis.”  He should know; he’s been through many, starting with overcoming dyslexia to achieve both a law degree and MBA, to bringing his company back from the tech bubble implosion.  Today he’s transforming his company, which includes an ever-expanding stable of acquisitions, from a command and control leadership style to one of collaboration and teamwork, because that is what he sees as the future.  He openly admits that he’s more comfortable with a command and control leadership style, but says that it won’t continue to work as the internet drives behavior, both business and personal, to a collaborative, team based experience.  His senior staff has to make that same mental leap now that the company is moving to a shared responsibility model of leadership.

Leaders like John Chambers are looking beyond the current economy and asking themselves important time-honored questions like:  What do I need to do today to best position my company for the future? What can I do to inspire my team with my vision? Does the company’s culture foster collaborative teamwork? Do I enable my team to speak openly about new ideas and business solutions?  Questions like these lubricate the mind and keep old thoughts from constantly running on the same mental tracks, leading to the same destinations.

Leaders inspire.  They light the path for others. Gandhi said, “Your beliefs become your thoughts, your thoughts become your words, your words become your actions, your actions become your habits, your habits become your destiny.”

Effective leaders challenge and fine-tune their thoughts, words, actions and habits regularly.  They ask probing questions of themselves and of their people.  These skills are as old as leadership itself.  They’ve stood the test of time – because they work. 

Gerath & Company
978-263-3060 / office
978-808-4231 / cell
978-263-1796 / fax
ruth@gerath.com
www.gerath.com

We are happy to have another guest blogger, Lauren Brenner, President of the HCR Group telling us what CEO’s need to know about Discrimination and Harassment claims.

DISCRIMINATION AND HARASSMENT CLAIMS ON THE RISE

When was the last time you distributed your Anti-Harassment Policy, trained your Managers/Supervisors on their compliance obligations and conducted Anti-Harassment Training with your employees?

Reality Check:

The most recent statistics are from 2007 and states that 75,768 EEOC (Equal Employment Opportunity Commission) claims were filed, resulting in $229,900,000 in monetary awards (Note: this does not include lost company time or legal fee expenses).

In Massachusetts during this same period, 3,413 MCAD (Massachusetts Commission Against Discrimination) cases were filed, of which 83% of claims were employment related, the other 17 % were filed for housing, public accommodations-related situations.

Of the MCAD filings the top 6 complaint categories were:

Disability – 20.5%
Sex – 17.4%
Race – 19.3%
Retaliation – 13%
Age – 9.4%
National Origin – 8.8%

What Can You Do?

Whether you have 1 employee to several hundred, you need to protect your organization.  This includes:

• Training managers and supervisors as to their legal obligations so that they can help to enforce a zero tolerance policy;
• Adding the term “zero tolerance” in all written anti-discrimination and harassment policies and procedures;
• Conducting annual anti-discrimination and harassment training for all employees and maintain the proper postings in common areas in the workplace; and
• Instructing supervisors and managers to report, and your designated Human Resources Representative to investigate any and all complaints made by employees, no matter how trivial or inconsequential.

Please contact Lauren Brenner, President/HR Division, HCR Group if you would like more information.