Friday , December 14, 2018


The story of Park Sterling Bank is actually two stories. The first story is about the startup and growth of a bank from the idea and vision of a handful of people. The second story, as important as the first, is about a sense of community and an understanding of a region. Where these two stories intersect is Park Sterling Bank.

Park Sterling Bank, founded in 2006, is a Charlotte-based commercial bank that offers both consumer and commercial products and services including traditional deposit and loan services as well as wealth management, residential mortgage and commercial and industrial lending services. But its goal and beginnings are what makes its story.


From a Seed

The seed of Park Sterling began with Bryan Kennedy. Kennedy helped start Park Meridian Bank in 1991 where he served as executive vice president. Prior to Park Meridian Bank’s sale to Regions Bank in 2001, Kennedy served as North Carolina president at Regions. But in late 2005, other bankers around him started suggesting it was time to, once again, start another bank.

“You start a bank,” Kennedy explains, “because you think you can put together the right people and resources to deliver a higher level of service to the customer than they can currently find in the market. Our founders saw a need for a more comfortable, more personal banking solution.”

With that intent, Kennedy, as CEO, put together a board of directors, some from the old Park Meridian Bank, and started raising capital in March of 2006. By June, they had finished with the largest startup bank capital raise in North Carolina history—$45 million. Park Sterling Bank officially opened for business in October of 2006.

Kennedy is serious about his responsibilities to Park Sterling’s shareholders. “When you sit across from folks and say, ‘I want to start a bank. Please trust me with your money and I’ll do something good with it,’ you feel a real obligation to do just that. We never forget that we need to make a return to our shareholders.”

Kennedy had the intention of growing the bank quickly and had a definite strategy to do it. “I put an infrastructure in place that would support growth. You can either put the right people and the right technology into place from the beginning or you can try to shortcut things and have people wear different hats, none of them well, and continuously play catch up.”

Kennedy’s plan for Park Sterling’s growth got an unexpected boost in 2010 when an industry associate introduced him to Jim Cherry and David Gaines. Cherry had spent more than three decades in banking in both North Carolina and Virginia for the former Wachovia Bank working as head of trust and investment management and as chief executive officer of Mid-Atlantic banking.

He also served as president of the Virginia Banking Association and even after officially retiring from his day job in 2006, Cherry stayed on to chair the association.

“I wanted to remain involved,” Cherry says. “I continued to look for ways to get back into banking. I started meeting with people in the industry. Meanwhile, we had the economic crisis of 2008. At the same time, in the banking industry, it was clear that there was going to be a unique opportunity for consolidation. A combination of low interest rates and an increasing regulatory environment was making the small banking business model untenable.

“I began by recruiting David Gaines who is now Park Sterling’s CFO. He was the controller for legacy Wachovia and their chief risk officer for corporate and investment banking after their merger with First Union, so he had significant finance, merger integration and risk experience.

“We started talking with regulators and other bankers and realized there was a void of regional banks in the Carolinas and Virginia. This was surprising since this area used to be the home of the regional banks—NCNB, Wachovia, First Union, BB&T, Southern National, CNS, Sovereign and Signet. There was just a whole cadre of regional banks and all of them, either one way or another, merged or consolidated or grew up and for some reason, unlike other regions of this character or size nationally, no one had followed in between. There were virtually no banks in this area in the $5 billion to $20 billion in asset size.

“This was significant because those were the banks that were typically large enough to have a broad array of products and services and some geographic diversity but still small enough to serve customers in a community banking framework. We recognized we had an opportunity to fill a need.”


A Shared Vision

Cherry wanted to partner with a bank to take advantage of that opportunity and in anticipation of that, Cherry and Gaines recruited a prestigious prospective board including Walter Ayers, retired president and CEO of the Virginia Banking Association; Jeffrey Kane, retired senior vice president of the Charlotte branch of the Federal Reserve, and Bud Baker, former chairman and CEO of Wachovia.

At the time that Cherry and Gaines met with Kennedy, Park Sterling was three and a half years old with about 50 employees, $500 million in assets and offices in Charlotte and Wilmington, N.C. It was a good match with shared philosophies on risk and customer service and Cherry admits he was impressed with the “smart things Bryan had done up front with Park Sterling.”

“It was state of the art,” Cherry says, “with a technology platform ready for growth and a quality management team in place.”

When an offer to partner was extended, Kennedy says he and the Park Sterling Board had to “do some soul searching.”

“It came down to our mission,” says Kennedy. “Was this the best thing for our shareholders? Should we go with a slower growth strategy, raising capital in small chunks or change direction, partner, and go with a larger capital raise? In hindsight, the decision to partner was 100 percent the right choice.”

“Bryan and the board had an even larger purpose to consider,” adds Cherry. “Which way would better serve the customer? How could they provide more products, services and capabilities to a growing customer base without more capital and other resources? It really was a continuation of the original vision but it was an acceleration of it. When most banks were retreating, this was an opportunity to advance. We agreed we had a vision to create a regional bank in the Carolinas area.”

In August of 2010, Park Sterling Bank became Park Sterling Corporation, trading on NASDAQ, and raised $150 million in an initial public offering. “It was one of the last and largest successful bank IPO’s in the current credit cycle,” explains Cherry. “As part of that capital raise, we were hired by Park Sterling.”

Kennedy left his position as CEO, becoming president and Cherry was named the new CEO. Gaines came on as the new CFO, a position previously held by Steve Arnold who became treasurer. The board was reconstituted but much of the key management was retained.

“We immediately began a two-pronged strategy,” Cherry explains. “First to expand in Charlotte and Wilmington, and go into other high growth markets like Raleigh, Charleston and Greenville, S.C. and recruit what I call the ‘A’ talent in those markets. We’d look for the very best people who were already doing business there and well regarded in that particular market, to build the Park Sterling franchise.

“The second part of the strategy was to use our capital and industry knowledge to partner with other banks in order to gain deposits, talent and other products and capabilities for our customers.”


Partnering for Growth

Park Sterling’s first partnership with Community Capital Bank in upstate South Carolina closed in November of 2011. Not only did the 25-year-old Community Capital fit well with the investment Park Sterling was already making in the Greenville market, it also brought them a mortgage brokerage product, a wealth management and a cash management product that they could now import into other markets.

Plans for their second partnership with Gastonia-based Citizens South came in March of 2012. Citizens South, which began in 1904 as Gastonia Mutual Building and Loan Association, had, prior to the merger, $1.1 billion in assets with 21 offices located in Gaston, Iredell, Rowan, Mecklenburg and Union counties in North Carolina, York County in South Carolina, and Towns, Union, Fannin and Gilmer counties in Georgia.

The merger further enhanced products, providing more robust cash and wealth management and providing capabilities for C&I (commercial and industrial) lending in addition to the real estate lending previously available to Citizens South customers. The merger also expanded the Park Sterling footprint into a new state—Georgia.

When it closed on October 1, 2012, the acquisition of Citizens South made Park Sterling the largest community bank in the Charlotte metro area and next to Bank of America, the second largest bank headquartered in Charlotte.

With current assets of $2 billion, Park Sterling’s acquisitions have essentially caused it to twice double in asset size in the last 14 months.

But along with growth, something else is just as important to Park Sterling’s management. “Because the banks we’ve acquired are community banks, they share our commitment of service to our area,” says Cherry. “This is our home. We grew up here and spent our careers here. We love this area and we know the people here and understand their needs and want to be a solution for them.”


A Solution for the Community

“Banking is a people business,” Cherry continues, “and people like doing business with people they know that live and work here and care about their community. We want to be an alternative to the larger, more impersonal banks. Our objective, in its simplest form, is to be large enough to help our customer achieve their financial aspirations and still small enough to care that they do.”

Their message appears to resonate with customers. Bill Crawford, who is founder of Wilmar Leasing and current chairman of the board for Wilmar Inc., has been a customer of Park Sterling since its beginning.

“We’re a vehicle leasing company so we use Park Sterling’s lending services,” says Crawford. “It’s been a wonderful experience. They have a great group of people. Bill Newbold handles our account and he’s the finest commercial loan officer I’ve ever worked with. He knows our business better than anybody and represents us well to the bank. With a community bank, character matters. When we meet with Park Sterling’s credit committee they know who we are, they know our business; they know our character.”

“With Park Sterling, relationship banking is not just something printed on a business card,” says Bob Salvin, founder and CEO of Salvin Dental Specialties, Inc. “Park Sterling took time to get to know us and establish a solid relationship. Several members of their management team, including the CEO, came out to our business to get to know us. They understand business entrepreneurs and, unlike some of the big banks, they view our business as unique.”

Customer Chris Moffat says he’ll “never go back to a big bank.” He uses Park Sterling not only for commercial banking and corporate borrowing in his role as vice president of Morehead Properties but also his personal banking. “I like their people,” he says. “They know us and anticipate our needs.”

Park Sterling currently has 44 branches with 17 in the greater Charlotte area and while further expansion may be in their future, Kennedy assures that there is “no build and flip strategy here.” “We want to build something we can turn over to the next generation of leadership,” he says.

“All of our executive management have had full careers in banking,” Cherry adds, “and have achieved their career aspirations. Now we share a common motivation. We want to recreate a strong regional community bank here. We’ve all come together to create something special in this community.”

The conference room is decked out in Florida Gators gear, and the bulletin board boasts a picture of “Weebee,” the company mascot. In one corner is a giant trophy with their names on it: Bill Crawford, 2008. Scott Crawford, 2012.

They’re the first father-son team ever to have both been awarded the trophy, recognition for receiving the National Vehicle Leasing Association’s Lifetime Achievement (NVLA) Award. Bill is understandably proud of his son.

Scott is a little more reticent. “I’m only 43, so it’s a little premature for me,” he says wryly.

But he was president of the association when the recession hit, and he guided it through the worst possible times for the industry. They froze the board in 2008 due to the recession, and as a result he served two years in a row, keeping the lights on during what was an otherwise grim period for the association.

The Weebee mascot atop the bulletin board represents the Crawford team’s dedication to “Working In Your Best Interest”—WIYBI, or Weebee. It’s that dedication, combined with determination and business acumen, that carried both the NVLA and Wilmar through.


Finding Home

In 1969, Bill had been into and then out of the Navy after graduating from the University of Florida. He was married with two children and a third on the way when he decided to join up with Hill Truck Rentals, a full-service truck leasing company founded four years earlier.

The company was based out of an old Amoco Service station in Orlando. Bill’s office was a 14-foot travel trailer plugged into the lady’s restroom for power, and he was paid $500 a month for his work as a salesman.

He was so successful as a salesman, that the company asked him to move to Charlotte in 1973 to open a new branch. After two years in that role, he moved into finance leasing with Leasing Consultants of Charlotte. Five years later, he decided he could do better on his own, and left the company in 1979.

Bill and his wife Marilyn, who was a Charlotte Country Day School teacher, had just bought a house and had $700 in savings. It wasn’t much, but Bill felt confident he could make it fly.

“Thanks to First Union, anyone could become an independent used car dealer,” he says. “They would back the financing, and you’d just find people who wanted to lease a vehicle.”

So he obtained a dealer’s license, and started working out of his very young daughter’s bedroom, the only room in the house with a phone jack. He named the company for himself and his wife: “Wil” for “William,” “Mar” for “Marilyn.”

Wilmar did well, and before long Bill had moved his office into the Key Man building, and then a small house they purchased for the purpose on Monroe Road.

Meanwhile, those three children were growing up. Both boys attended Bill’s alma mater, the University of Florida. In 1990 the eldest, David, graduated and joined the family business. Scott followed the year behind him. Elizabeth, a University of Georgia graduate was not far behind.

David is still in the business as vice president and salesman, and Elizabeth recently stepped out in order to become a full-time stay-at-home mother. Scott says that initially, he joined the company part-time, “just to keep me busy and make a little money while I decided what I wanted to do with my life.”

What he decided, is that he loved the family business and wanted to run it. He now serves as president.

In 2004, Bill and his children worked with their accountant to structure an ownership transfer in conjunction with re-branding the business. At that time, the legal entity name was Wilmar Leasing, Inc. That year, Scott and his siblings founded Wilmar, Inc and took over the overhead, rent, and employees. As leases expired under Wilmar Leasing, they were taken over by Wilmar. Seven years later, nearly all the leases—some 3,800 of them—are now handled under Wilmar Inc.


Full Menu of Services

The change in name from Wilmar Leasing, to Wilmar, Inc., represents not only a change in leadership, but also a clearer understanding that leasing is only one element of the company’s offerings. From fuel management to acquisition and financing, Wilmar provides customers with a full a la carte menu of services designed to help make the most beneficial fleet decisions for their companies.

Leasing is often at the core of these services. According to the Crawfords, more than 80 percent of U.S. corporations lease some or all of their equipment. Often, leasing makes more sense than buying because it offers financial flexibility, tax advantages, and the ability to leverage new technologies as they emerge.

Still, many companies avail themselves of other Wilmar services regardless of whether leasing is in the picture for them. Services include maintenance plans, administrative services, fuel management, acquisition, disposal, fleet policy, replacement cycling analysis, motor vehicle records, financing, roadside assistance, accident management, and expense control.

All of which is offered up with an old-fashioned dose of committed customer service. Bill explains: “I grew up in a time when your name meant something. You didn’t do anything to affect the reputation of your name. You didn’t blemish that.”

For Wilmar, this means that they work hard to uphold their company motto: “Working In Your Best Interest”—even when it may not be in their own short-term interest.

For instance, Bill relates a recent incident in which a customer called to ask about leasing a $45,000 truck. The customer had just won a large new contract that would require transporting large quantities of material, and he was excited and eager to enlarge his fleet to accommodate the work. Bill thought he might need to know more.

“I said, let me come out and visit with you,” says Bill. After understanding the situation, Bill told his customer he did not need a $45,000 truck, even though it would have meant a nice profit for Wilmar. Instead, he suggested that the customer buy a $5,000 trailer, and hook it up to the pick-up truck he already had in his fleet.

“You can load it up, drive it where it needs to go, leave it there, and pick it up again in the afternoon,” he explained. “Instead of insurance and maintenance and fuel, and another lease payment, you can tow it with what you already have.” Bill helped the customer purchase the right trailer, even though Wilmar made no money off the deal.

Bill explains that their business approach has always been to take care of the customer so that instead of trying to make a lot of money at once, you can make a little bit of money, every month—forever.

“A retail car salesman works on a commission and he’s trying to make as much money off each sale as he can, because that’s his income,” he says. “Our business is totally different. We don’t care what car you lease, and we don’t care about knocking a home run on every deal. If we help our customers make the right choices and set up the lease correctly, that customer will come back year after year.”

Because Wilmar doesn’t need to lease a particular make, model or year of vehicle, they are able to provide customers with unbiased information necessary to make the very best decision for their company.

When a new customer contacts Wilmar, a salesperson takes the time to understand what their business is like, take a look at what they’re driving, and help them make good selections based on their needs. In addition to cost per mile, they look at company role and the needs of the drivers.

For instance, a highly paid salesperson will require a different sort of vehicle from an entry-level technician. They likewise take the time to understand how much cargo each vehicle may need to carry and choose an appropriately sized vehicle with the right capabilities and options.

Wilmar lives and breathes numbers, using them to help customers make smart choices about their fleet. “We know what a vehicle is worth the day you buy it, what it’s worth every month through its life, what it costs to fuel it, and what it costs to maintain it.”

“It’s about cost per mile,” explains Scott. “That’s the bottom line. You take the lease payment, plus what you paid in fuel, insurance, and maintenance, plus what you lost or gained on the sale at the end, and divide that by the miles driven. That’s the equalizer.”

Wilmar prides itself on providing this kind of information to customers so that they can make intelligent fleet decisions for their companies. It’s this commitment to work in the client’s best interest that helped Wilmar and many of its customers make it through the recession.


Hard Times

Few industries were hit as hard as the auto industry by the recent recession. Scott says that for Wilmar, the downturn began in 2007, and by 2008 the entire business came to a near standstill.

Wilmar had been through three previous recessions, and outlived them all. But this one was something different, and they could see that from the beginning. Previous recessions had driven more owners and managers to seek Wilmar’s cost-saving services. This recession simply drove businesses to a standstill.

“Owners began to drive vehicles into the ground,” says Scott. “They were so afraid to commit to another vehicle. Our revenue dropped 20 percent in ’07 and 45 percent in ’08.”

Times were tough, but some of the revenue drop was a deliberate and conscious choice on the part of Wilmar. “When things started to go south, we saw it wasn’t going to be good,” recalls Bill. “We got all the sales people in here and we said, ‘Go out and visit all your clients and see how they’re doing. Find out how you can help them.’ And they did. They helped a lot of them downsize.”

For instance, an HVAC company that ran 15 vans continuously during boom times found that it could only keep 10 of them busy in 2008. Wilmar met with them to see how they could help, and found a way to take five of the vans and either sell them or lease them to other customers who needed a good used vehicle.

As a result, Wilmar’s total fleet portfolio shrunk by 33 percent during the recession years. Many company leaders would see those numbers as a bad sign, but Bill and Scott knew better. As a result of their aggressive efforts to help their customers, almost none of their customers ever defaulted on a lease. Even during these difficult recent years, with a portfolio of nearly 3,800 vehicles, they have had only two defaults in three years.

Because the company carries no debt except what is tied up in vehicles on lease, it can afford to take a deep cut in revenue and continue to function. And because the business model is based on long-term leases, even if there were no new accounts or eliminated and reduced accounts, the company’s revenue stream never just goes away.

Says Scott, “We have learned to be more efficient and to control costs tightly, but have never had to cut staff or take other drastic measures to continue to stay afloat. Our customers are still in business, and still paying on their leases. And most of them are devoted, lifetime customers. And the trend is turning upward again.”

Wilmar has been serving Charlotte since 1980, and their client list includes many well-known Charlotte brands like Bojangles, Belk, and Lincoln Harris. With revenues of $18 million, and a fleet of nearly 3,800, the company is poised to serve pent-up demand when the economy improves.

While they specialize in fleets of under a hundred vehicles, Scott says size doesn’t matter as much as whether the company has an inside person dedicated to managing its fleet. He points out that in many small businesses, the owner or controller is responsible for managing the vehicles, and usually it’s a job they don’t relish.

For those companies, Wilmar’s team acts like an outsourced fleet management team, allowing executives and operations managers to focus on their core business. With the customer’s best interests at heart, Wilmar acts like a dedicated employee, ensuring the fleet is managed as efficiently and effectively as possible.

If Scott’s NVLA lifetime achievement award was “premature,” it’s only because he’s not done achieving yet. He has every intention of building Wilmar even bigger and stronger, and looks forward to seeing where it can go in the coming years.

New Year’s resolutions have a spotty history of success. Made in January, they are usually broken and forgotten by spring. But despite repeated failures on a personal level, there is a lot to like about business resolutions. They are another name for plans and when made by self-confident, decisive and resolute people, they often work.

Thanks to Matthew Dixon, Brent Adamson and Nicholas Toman, writing in the July-August issue of theHarvard Business Review (HBR), there are a few new ideas that sales training managers might include in their New Year’s strategic mix. Should sales staff stay with the solution sales model that has guided sales training since 1975 or transition to Dixon’s 21st century-based insight selling model? Their article leaves little doubt as to their bias; it’s titled “The End of Solution Sales.”

Solution selling comes to the table with a long and successful track record. It radically changed the role of sales representative from product knowledge expert to a coach who seeks solutions to customer problems. Solution sales reps are trained to ask open-ended questions about what keeps their customers up at night. They learn to locate customer pain, build relationships, relieve angst through a sales solution, and deliver satisfaction.

Dixon finds that organizations where solution selling works—those companies with a clear vision, clear need for change and established demands—are not venues that attract top sales personnel. Organizations that are in flux with emerging needs, appeal to star sales performers.

In a recorded interview on the HBR website, Dixon examines the way we buy automobiles today. It’s a good example of how the sales environment has changed since 1975. Long before customers visit a dealership they have checked Consumer Reports ratings, Internet-based analyses and peer reviews. If unaware of their options by this stage of their research, they have at least narrowed the field. Potential car buyers then go on to obtain price reports that reveal a dealer’s true cost of the car or cars that meet their needs. They learn too what others have paid for similar cars and a suggested target price.

Dixon estimates that with help from the Internet and other resources, 60 percent of all purchase decisions are made before consulting a sales rep. There is precious little pain for the rep to relieve and few obvious problems left to solve.

So what is the role of a successful sales rep? Her job according to Dixon et to focus on unacknowledged and unrecognized needs, the issues that should keep the customer up at night. “Here are the issues that could seriously disruptyour life if left unattended,” says Dixon’s idealized sales star. This is the essence of what he calls insight selling.

Customers don’t necessarily believe these tea leaf readers. They are skeptical and that is exactly what Dixon encourages. Challenger reps, as Dixon calls top sales performers, prove their worth by steering doubters away from disaster and into purchases that prevent pain from ever occurring.

A clever idea, but is it worth including in your 2013 sales training? We asked six Charlotte area sales training experts to weigh in.

“It is the worst article I’ve ever read about sales and relationships,” says Jeffrey Gitomer of Buy Gitomer and Train One. In Gitomer’s view, the author’s advice is “dangerous to sales people and their careers” because “there is nothing in there about value, respect, trust and relationships.”

As far as seeking out skeptical clients goes, Gitomer doesn’t buy that either. “If a client doesn’t like you, they won’t do business with you.”

Then there is the title of the article, “The End of Solution Selling.” Gitomer goes it one better. “Solution selling was dead the moment it was written,” he says. It relies too much on techniques and systems. “The key to selling is harmonizing,” he emphasizes. Techniques create barriers to authenticity and impede harmony.

Tim Conner, an author of 80 books on selling, sides with Gitomer. “The authors present a lot of old school stuff repackaged to look new and relevant,” he says. He finds that many successful people in sales are already following what the authors recommend.

Bob Henricks agrees. He heads up Henricks Corporate Training & Development/Sandler Training, a Charlotte sales training company. He says, “Insight selling sounds new and fresh, but at the end of the day, I’m not sure there is anything new here.”

Neither Conner nor Henricks are ready to write the obituary for an old, reliable workhorse. “Solution selling is not dead,” affirms Conner. “Solution selling still has a place,” agrees Henricks. “People buy for the same reasons they always have—to avoid pain and pursue pleasure.”

Keith Eades, founder and chief executive officer of Sales Performance International, would know if solution selling were dead or dying. He was an associate of Mike Bosworth whose research at Xerox Corporation helped develop the solution selling methodology, and has written The New Solution Selling and co-authored The Solution-Centric Organization. His take on the HBR article is more nuanced than Gitomer or Conner.

“The attributes ascribed to solution selling in the article and associated chart don’t remotely resemble what the documented methodology actually teaches—in some cases they are the antithesis of what is taught.

“Take the issue of the type of organizations where solution selling and insight selling are supposed to work—clear vision and established demands for solution selling and in flux for insight,” continues Eades. “If people or organizations already have clear visions of what they need to solve problems, they wouldn’t need salespeople. The real value solution sellers bring is when they can help someone see a way to solve a problem they didn’t know existed or a problem they didn’t know how to solve.”

“We teach the concept of latent pains, latent problems or latent opportunities,” Eades explains. “This is the world that exists within a buyer’s mind where problems or opportunities are hidden, dormant or inactive.” In these cases, solution selling provides clear vision; it doesn’t need clear vision at the onset.

Pat Heidrich, a Cornelius-based sales trainer, gives insight selling a passing grade on many of its ideas. After all, insight is what led Steve Jobs to revolutionize the computer marketplace with the iPad. And challenging a client has a lot going for it. He is quick to add qualifiers, though.

“Take insight…The problem is how do you transfer insight to others? If it is transferable, I can’t teach it in a one-day seminar,” says Heidrich. Enlightened organizations take the time to encourage and support insight and then develop salespeople who believe they can deliver it.

And delivery matters. “It is okay to challenge a prospect’s beliefs,” continues Heidrich. But it must be done short of insult. “There are techniques for getting away with challenging a client while maintaining rapport. You always keep a client in an okay state,” he says. That’s okay as in I’m okay, You’re okay, the classic 1967 text on transactional analysis by Thomas Harris. It’s a book that Heidrich refers to often.

Henricks thinks challenging clients even when done with rapport is not always a wise strategy. What if the client is a highly dominant personality type? “They don’t like to be challenged,” says Henricks. “Do that and you’re out of the office in 15 minutes.”

Jim Dunn of Dunn Enterprises of the Carolinas/Sandler Training is the one sales trainer that has gone beyond the HBR article. He has read The Challenger Sale, the 2011 book by Dixon, Adamson and Toman; it was a gift from one of the best salespersons he ever met.

His take: “Insight selling is dead on. I believe that 20 percent of salespeople have figured out the market. They are the professional salespersons the authors write about. The other 80 percent are getting bad advice, not reading books on selling and not doing the kinds of things that raise the bar of performance. They will find themselves out of a job.”

And does he believe that we have seen the end of solution selling? “Yes, I think so. The article and book express a different approach. They make a unique, valid and important statement.”



Selling Solutions for 2013

Putting differences aside, we asked all six for their best recommendations for building sales in the New Year. Where do they think the gold is buried in 2013?


  • Increase prospecting behavior. Make more cold calls, says Pat Heidrich. “You can easily make 10 to 20 cold calls in an hour and it is an activity that is 100 percent under the control of the salesperson.” Whenever he can, Heidrich attaches social media to the call. He checks Linkedin for a prospective buyer’s profile to see if he and the client have contacts in common. If there is a common link, “I call my friend and ask a favor. Would you call X and see if he would take my call?”


  • Ask negative questions. Jim Dunn approaches prospective clients with this observation: “You are probably not experiencing these trends that I’m seeing in other companies.” Surprisingly, clients often open up to that type of inquiry. “For established clients try asking, ‘What would I have to do in 2013 to lose your business?’” The result, says Dunn, is an honest conversation.


  • Reinvent yourself. “The number one reason companies fail is that they have lost relevance in the marketplace,” maintains Tim Conner. He encourages CEOs to read books and articles by futurists and then ask how their own marketplace has changed. Conner recommends blending those trends into company policies and procedures.


  • Get close to your customers. “Relationships matter,” says Jeffrey Gitomer. “Provide your customers with enough value and they will be loyal to you and refer others your way. If you can get every customer to refer one customer, you can double your business,” says Gitomer. Value comes from telling what Pat Heidrich calls—third party stories. For example, “Here are some of the issues others like yourself have shared with me. I don’t know if you are experiencing the same thing, but I’m hearing a lot of that.”


  • Track prospecting. There are 70 cameras trained on every play in the National Football League. Coaches know what their players have done and what might improve player performance. “Sales managers could achieve the same result with prospect tracking software,” says Pat Heidrich. “The best salespeople will react positively,” he maintains. Keith Eades calls them “sales enablement tools” and advocates that they be linked to a company’s customer relationship management program.


  • The universal truth. Bob Henricks reiterates, “People buy for the same reasons they always have—to avoid pain and pursue pleasure.”


  • Probe, learn, listen, ask questions. Keith Eades says, “If people or organizations already have clear visions of what they need to solve problems, they wouldn’t need salespeople. The real value solution sellers bring is when they can help someone see a way to solve a problem they don’t know existed or a problem they didn’t know how to solve.”

The test of a strong company is often not the way it performs when times are good, but how it responds to adversity. It’s sort of like the old saying, “When the going gets tough, the tough get going.” For Charlotte-based construction services firm Myers & Chapman, the recession of 2008-2009 served as a true test of that old axiom.

The recession had a devastating impact on the retail developer business that had, for years, provided Myers & Chapman’s bread and butter construction projects. New shopping center and office projects ground to a halt as consumer spending dropped, businesses put expansion plans on hold, and the financial crisis caused banks to pull back on project financing.

To make it through the tough times, Myers & Chapman refocused away from the developer-driven work that had suddenly evaporated, diversifying into a wider variety of construction projects supporting industrial, office, medical, and institutional clients. Building new relationships became just as important as building great buildings, and in the process, Myers & Chapman became an even stronger and better company.


Building the Carolinas

In 2013, Myers & Chapman will mark 60 years serving the commercial construction needs of developers and business owners in the Carolinas and the Southeast. Founded in 1953 by Brevard Myers and John Chapman, the firm operated under their leadership until the late 1980s when they sold the company. A period of ownership transition culminated with Mike North assuming majority ownership in 1990.

That same year, North hired Rick Handford as vice president of operations. A 1975 graduate of Furman University, Handford came to Myers & Chapman after 13 years at Metric Constructors working with estimating, purchasing, cost control, scheduling, superintendent and project manager duties. In 1996, Handford was promoted to president of Myers & Chapman.

North and Handford ran the company until 2004 when North decided to sell his interest and step back from the business. Handford increased his ownership to become the majority shareholder, and Bob Webb joined the firm as CEO and second-largest shareholder.

Webb, a 1974 graduate of Appalachian State, came to the company after 26 years in the construction business. He had joined the McDevitt & Street Company in 1978, continuing through that firm’s acquisition by Bovis in 1989 and the subsequent acquisition of Bovis by Australia-based Lend Lease in 1999. Today, Handford and Webb own close to 85 percent of Myers & Chapman, with the remainder spread amongst several other members of their management team.

“We’ve had a fairly diverse portfolio of work over our 60 years,” says Webb. “It has probably been more retail construction than any other sector, but in recent years we’ve broadened our base to include more industrial, medical and institutional projects. We now describe our business as construction services because we can offer a variety of deliverables, from complete design-build projects to program management where we supplement the client’s staff to help them get things built, renovated, or up-fitted.”

As CEO, Webb handles the overall leadership of the company, including strategy, sales and marketing, pre-construction services, and accounting. Handford runs the day-to-day operational aspects of getting buildings built, including managing their staff of project managers and project superintendents.

The leadership team also includes Bo South, vice president of sales and marketing; Derek Carpenter, vice president of pre-construction; Marcus Rabun, senior project manager; and Mike Ussery, safety manager. As vice president of sales and marketing, South is responsible for finding new opportunities by networking with architects and engineers and empowering other team members to uncover new opportunities through their work on existing projects.

Carpenter’s pre-construction function includes the myriad of things that need to take place in the early stages of a project to help clients budget and schedule, such as estimating, value engineering, and value analysis. Rabun manages several key client relationships and Ussery drives the overall safety strategy and makes sure a consistent safety discipline is employed across all projects.

Myers & Chapman’s projects are concentrated in the Charlotte region, but stretch into South Carolina, Virginia, Tennessee, and Georgia. According to Webb, a significant percentage of their work is within 50 miles of Charlotte, with most of the remainder coming within a 200-mile radius.


Diverse Skills and Capabilities

With 20 superintendents, seven project managers, and four pre-construction experts on staff, Myers & Chapman can call upon a diverse set of skills to complete a wide variety of projects for their clients. Whether it’s a retail, office, industrial, medical, or institutional project, and regardless of whether the project involves ground-up design-build, renovation, or just interior up-fit, Webb and Handford say their team has the knowledge and expertise to complete projects on time and on budget.

While the average Myers & Chapman project is about $3.5 million, averages can be very misleading.

“We’ve done a $70 million job and we’ve done $20,000 jobs,” Webb explains. “Generally speaking, if a job gets below $100,000, or maybe even $200,000, it might not make sense for us unless it is part of a larger client relationship. We do a lot of projects under $2 million, but we also have a decent number of projects in excess of $10 million.”

In 2007, retail construction made up a significant portion of Myers & Chapman’s projects, but with retail expansion slowing in recent years, the company has diversified their project mix.

Some of the projects currently underway include the City of Charlotte Fire Headquarters building, a medical office building in Rock Hill for Carolinas Healthcare System, and a major project for Cato Corporation that includes a new 60,000 square foot office building on their south Charlotte campus plus a 75,000-square-foot office space renovation coupled with a new exterior façade.

But while large retail project volume is down, Handford and Webb say retail is far from dead due to continued activity in smaller retail projects such as new stores they are building for CVS and PetSmart.

Shopping center renovations are also becoming more common, an example of which is the complete renovation of Quail Corners Shopping Center located on Park Road in south Charlotte. That center’s developer, Crosland, happens to be one of Myers & Chapman’s longest standing client relationships, the two firms having worked together for 25 years or so.

“A recent project we’re very proud of is the new Huntersville police station,” beams Webb. “The city was having trouble figuring out where to get the $18 million they needed for a new police station, but someone had the idea to buy an empty building in the depressed marketplace and renovate it. They ended up buying a building in a prime location and we came in and did an interior renovation which gave them everything they wanted for a total cost of less than a third of the original $18 million price tag.”

“We’re also building a textile mill in Hamlet for Knit Rite out of Kansas City,” he continues. “We’re going into an old mill that has been sitting empty for years, completely gutting it, and re-up-fitting 80,000 square feet. They make specialty medical fabrics. It’s another example of putting a resource back into use.”

Another noteworthy project for Myers & Chapman is a large manufacturing facility in Concord. It started out as a 150,000-square-foot new build project, but halfway through construction the client increased the space to make room for additional manufacturing capacity.

“The original plan had a large warehouse component, but they decided to convert that to production space,” says Handford. “It started small and became very big, and is an example of a satisfied client bringing us repeat business because of our ability to satisfy their unique needs.”

Myers & Chapman is also a leader in green and sustainable building services, including LEED Certified projects, Energy Star buildings, and the latest green building principles and practices. LEED is an internationally recognized green building program developed by the United States Green Building Council that provides a framework for practical and measurable green building design, construction, operation, and maintenance. With seven LEED Accredited Professionals on staff, Myers & Chapman has completed a number of LEED Certified projects, including their own LEED Gold headquarters office.


Stronger and More Diversified

The last four years have not been kind to the construction business, but Myers & Chapman has made it through the storm and emerged a much stronger and more diversified firm in the process.

“In the 2005 to 2007 period, the vast majority of our work was for developers,” admits Webb. “But that industry fell off a cliff. The volume of new permits was down 75 percent from 2008 to 2009 and our developer work came to a screeching halt.”

“In September of 2008 we had 23 project awards just waiting for a notice to proceed,” remembers Handford. “Only one of those 23 actually ended up starting and that one didn’t start until this year. So 22 completely vanished. We went from $95 million to $38 million in top line revenue from 2008 to 2009.”

To make it through the downturn, Myers & Chapman shifted their focus away from developer-driven work to the kind of work that was still out there—projects for end users such as Carolinas Healthcare System, Cato, and Knit Rite that own their own buildings. The new strategy paid off as revenues recovered to $73 million by 2011. They expect to finish 2012 with about $75 million of revenue on the books.

“The economy forced us to put a new emphasis on relationships,” explains South. “Referrals, networking, and relationships with architects became much more important to help identify new opportunities.”

Another key to their success has been an unrelenting focus on the client and making sure they are always looking out for the customer’s best interests from start to finish. To accomplish that goal, everybody in the organization is empowered to do what is necessary to take care of the client.

“You don’t have to ask the next guy up the ladder whether you can do something to make the client happy,” says Handford. “As long as it complies with our values, the company stands behind whatever you do. Our one restriction is to do the right thing.”

The leadership team continues to look warily at the direction of the economy, but based on the current book of business and the potential project pipeline, they are cautiously optimistic about the future.

“We know that whatever happens two years from now or five years from now is going to be different from what is happening today,” concedes Handford. “But people are always going to need construction. As long as people are moving into and out of business locations, they’re going to need to reconfigure the space, they’re going to need new space, or they’re going to need to prepare for new capabilities.

“Our job becomes to identify what that market is at any given time and help that market learn who we are so that we can service it. We have diverse talent in this building, so whatever the change calls for, we’re going to be in a position to provide it.”

Long-term vision is woven strongly into the life insurance firm of Barry, Evans, Josephs & Snipes (BEJS). “A life insurance policy is a contract,” says John Barry. “If you think about it, it’s the longest contract that any of our clients will ever enter into.”

Barry—partner, president and CEO—is the second generation of his family in the firm. His father, Ernest Barry, along with Don Evans, Rick Snipes and Alex Josephs, flipped the traditional business model upside down when they founded the company in 1984.

“The typical insurance advisory firm out there consisted of a large sales force and a small support staff,” explains partner Clint Crocker, “but the principals of BEJS realized that the idea of buying a life insurance policy and putting it in a safe deposit box to gather dust didn’t work for their clients’ level of sophistication.   Their clients needed ongoing service of their plans, so for every one or two people they had out in the field marketing, they had three or four people in the office dedicated to serving their clients.”

That founding principle of high level, ongoing service continues today through the leadership of BEJS’ five current partners: John Barry, Clint Crocker, Gerald Applefield, Ernest Barry, and Scott Jones. With close to $5 billion of total insurance in force, BEJS specializes in the unique insurance needs of affluent families, high income executives, and businesses concerned with preparing for business succession or developing select executive benefit plans.

“Attributes of the affluent marketplace require certain products or specialties that can’t be accessed through the routine insurance firm,” explains Crocker. “We can bring those clients something that’s not ‘off the shelf.’ We specialize in helping families and businesses protect what’s important to them.”

“Everything is customized,” adds Barry. “We don’t come with a solution looking for a problem. Our tagline is ‘Priorities Preserved.’ We’re relationship-oriented, so we work on understanding the priorities of each client, and we play long-term, so we can fully understand what those needs are.

“Most insurance agents or brokers take a product they are given and try and sell it, but we have 30 years of experience underwriting the high net worth and executive marketplace, and that knowledge sets us apart and allows us to be innovative.”


Select Membership

One of those innovations is BEJS’ membership with M Financial Group, an elite financial services company that provides products and services specifically tailored for the affluent market.

“We know that because of access to better health care, better education, and a better standard of living, the higher net worth market has a better risk profile,” Barry explains. “Information suggests that an investable net worth of $1 million or more starts to show an improvement in mortality rates and that improved risk should translate into better pricing that we could then deliver to our clients.

“But when we first suggested that to the large insurance companies they laughed at us. The only way the insurance companies would consider doing something like that is if we put our capital at risk, side by side, with theirs. The vehicle through which we invest capital alongside another insurance company is our reinsurance company.”

Through M Financial Group’s reinsurance platform, which represents $47 billion in face amount and $8 billion in assets under management, BEJS is able to offer clients a differentiated pricing advantage that lowers policy costs and offers better value for that cost. They can also offer M Financial Group proprietary products specifically designed for the high net worth and executive market.

“The proprietary products we offer are issued by name brand insurance companies like Pacific Life, The Prudential, and John Hancock, but the product you get from those carriers through BEJS is priced differently and better suited to our clients than the product you would get from your local agent,” Barry points out.

Although the company is licensed to sell insurance in several states and has clients in Texas, Arizona, California, Florida, Illinois and in states along the Northeast corridor, Barry describes BEJS as a “Carolinas company.”


Local Focus

With three founders from Charlotte and one from Rock Hill, S.C., the firm’s original focus was the Charlotte metro area. In the heyday of Southern textile mills, Barry says the firm “owned the textile mill market” from Anderson, S.C., through Greensboro, N.C. The privately held, multi-generational business model so typical of the textile industry is still a big part of the firms’ core client base.

“We take tremendous pride in our multi-generational work. Today, we have families where the grandparents, children, and grandchildren are all clients,” says Barry. “That’s very much a part of who we are, but it’s not what we do exclusively.

With specialized products and services, BEJS can step in when standard employer benefit plans are inadequate to fully protect a high income professional and his or her family. Customized plans can provide additional disability protection or supplement a retirement program.

And in keeping with their long term vision, BEJS has expanded their focus to include high income professionals.

“We realize that there is an entire level of professionals who will one day be leaders in their organizations,” explains Barry. “They’re young, bright, articulate, and aggressive, and they are already doing well and working their way up. They may not be high net worth today, but they’re likely to be high net worth tomorrow, and we want to get the message out that they may be able to benefit from our resources and services now and also in the future when their needs change. We fundamentally believe that acorns grow into big trees and want to invest in building relationships with emerging leadership talent.”

Business succession planning is also a specialty of the firm and one in which expertise is enriched by the company’s own personal experience. “We’ve gone through every type of business transition event possible,” says Barry. “We’ve added partners, had partners retire, and had partners die. We’ve done a reorganization and also a strategic partnership with a public company. We’ve sold to a public company and then bought it back. Having actually gone through those events puts us in a better position to plan for our clients with a great level of empathy.”


Valued Relationships

And while BEJS can help clients in any one of their specialty areas, they find that their initial work with a client in one area often broadens into other areas. “We may begin by working on executive benefits,” Barry explains, “and that turns into succession planning, which then turns into transfer planning. Or an initial engagement in estate planning turns into executive benefits.

“We never know where we’ll begin with a client, but we do know that because we are relationship-oriented and play long term, we might be involved in multiple projects with a client over a 20-year relationship. The initial project may be at a superficial level, but as that relationship builds over time, other issues are revealed, and we start to address them as well.”

“We not only work with clients, we also work very closely with the clients’ other advisors,” adds partner Gerald Applefield. “Whether it’s their accountant, attorney, investment manager, or trust officer, we do tremendous work advocating and supporting the advisory community. Our efforts are collaborative.”

“Often, a client’s advisors will come to us for help in working through a particular situation,” Barry explains. “Recently, we helped edit a resource book called The Advisor’s Guide to Life Insurance published for the American Bar Association. Providing educational resource to the advisory community in our area of expertise is a part of our culture.”

“There’s a misconception out there that insurance companies all provide about the same service,” adds Crocker, “but we’ve got a service department you won’t find at other firms. We put a lot of energy and resources into taking care of our existing client base rather than just on acquiring new clients.”

“We want to make this a pleasing experience for our clients,” says Barry. “That’s why we spend so much money on our staffing and administration team and do so much training. We have really bright people who have the ability to advocate on the client’s behalf.”

“We can distribute and even assist in manufacturing the product, but we also understand how important it is to properly service the product,” adds Applefield.

“Back in 2003, there was a regulatory change regarding the tax code for a popular insurance planning concept known as ‘split dollar,’” Barry recalls. “Gerald is known for his work in this area, so we were inundated with calls from attorneys asking for help.

“The attorneys told us that other agents were ignoring the issue because they weren’t getting paid for it. It was pro bono work, but we felt it was part of building relationships. Because of that, we ended up getting new work, but the point really is taking care of the client even when, sometimes, it’s not transaction-based. It’s a testimony to making the investment in the long-term relationship.”

Maintaining existing accounts is enhanced by the firm’s customized service process where a firm member sits down with a client in a “shirt sleeves session” to discuss their current situation and what is meaningful to them, ensuring that their needs continue to be met—preserving priorities. The customized service process is complemented by strategic reviews to address specific changes that may affect insurance needs.

“You can’t buy insurance like you used to,” states Barry. “Somebody needs to monitor that insurance to optimize performance with due consideration to goals and objectives that change over time. Just like you would expect a stock broker to manage your portfolio of securities, our clients can expect us to manage their portfolio of insurance.”


An Honored Role

But BEJS’ aspirations run even higher than effectively managing a client’s insurance. Barry describes the greatest affirmation of their work as being part of a client’s “inner circle.”

“In this business,” he says, “there’s always talk of the ‘need moment’ when the unfortunate happens. We are very sensitive to earning the opportunity to be a member of the inner circle in that ‘need moment.’ We believe it’s an honor to be one of those advisors that gets the call.

“It’s important to be included among a client’s other advisors when that client explains how they wish things to be handled so there’s no confusion when they die. That’s a critical role to play and we value the opportunity to be part of that.

“It sounds corny,” Barry continues, “but there’s nothing more satisfying than knowing that you did something that made a positive difference in someone’s life. That’s what we call psychic income.”

BEJS looks at growth differently than most businesses. They mark it with milestones such as when previous partner Ernest Barry Jr. rejoined the firm in 2009 and when Scott Jones, formerly of Executive Financial, became a partner in 2011.

Last year, the firm’s assistance in making TIAA-CREF a carrier partner of M Financial was another growth milestone. As the firm continues to grow there are plans for the addition of new, younger partners because as Barry proudly states, “One of the founding premises of this company is that the institution would be here to service the client in perpetuity.”

It’s a foundation based on long-term vision.

Modern society takes a lot for granted. We expect that when we flip the switch, push the lever, turn the knob, key in the numbers or press the button that the lights will come on, the elevator will open, phones will ring, the room will be heated or cooled, the toilet will flush, and, if we are threatened, alarms or sprinklers will get our attention. Few people stop to think about how these and many other more complex systems work in the buildings that we inhabit. As long as it’s all working, it’s all comfortably out of mind.

Not so for the engineers and designers of Optima Engineering, a full-service electrical, mechanical and plumbing engineering firm, who not only spend their talents designing electrical and mechanical systems, but also work to make sure that they function in the most environmentally friendly and most cost-effective manner.

“We support the built environment industry by designing systems most people never see,” says Keith Pehl, Optima Engineering’s founder, president and chief electrical engineer. “It’s not just about having these systems work; it’s also about designing an environmentally sustainable building. We call them high-performance buildings; designed to use the least amount of water, electricity and natural gas.”


Sustaining Growth

Started in 1992, Optima Engineering has built a reputation as a leader in the sustainable movement. “It’s one of the things that make us stand out from other firms,” says Pehl. The firm has completed over 150 green projects in the past few years. “Sixty to 70 percent of them are LEED certified (Leadership in Energy and Environmental Design, the recognized standard for measuring building sustainability), but all of them were done with a focus on sustainability,” says Pehl.

“There are a lot of things we do that just make sense that the owner doesn’t necessarily ask to be done—solar thermal water heaters, for instance. Sometimes they argue; mostly they thank us. We go in with the presumption that we are the experts in this. If it doesn’t make sense, we won’t do it,” says Pehl.

Pehl earned his own LEED accreditation in 2004 when LEED methodology was gaining interest around the country. “I pushed my staff to seek accreditation as well. They pursued it first; embraced it later,” chuckles Pehl.

Ronald Almond joined Optima Engineering in 1994 as a partner and continues to serve as vice president and chief mechanical engineer. Together, he and Pehl have built their staff to 35 members. Among them were Brian Thompson and Steven Daley, both of whom arrived in 1997 and have now become stockholders and managing principals in the firm taking on the day-to-day operations.

“Our new positions and focus free up Keith and Ron to spend more time examining new innovations and trends, as well as on business development,” says Daley.

Optima Engineering has a significant presence within the Charlotte skyline. “We’ve worked on most every building in uptown Charlotte at some point or another,” remembers Pehl. The firm has completed over 10,000 projects since it began.

“Seventy percent of our business is in the Carolinas but we are registered in 40 states,” confirms Pehl. Often, out of state work is driven by client expansion. Pehl and Almond attribute their success to the acquisition of talented people, diversification and deliberate growth.

Many well known names comprise the list of buildings, sites and facilities which carry sustainable infrastructure designed by Optima Engineering: Carowinds, Capitol Broadcasting Company, Charlotte-Douglas International Airport, UNC Charlotte, Wells Fargo, NASCAR Plaza, Time Warner Cable, zMAX Dragway, Elevation Church, Charlotte Area Transit System (CATS)—the list is lengthy.

“Projects are generally complex and can take a year or more to complete. Then we offer ongoing support to maintain the sustainability of the building,” says Pehl. “Take Carowinds—it’s a city from our perspective. In the summertime, there are more people there using infrastructure in any given day than the population of most towns in North Carolina. We’ve just finished eight projects out there. They’ve been a client for the past 20 years.”

Historically, most of the firm’s clients were architects—around 80 percent. Now, architects make up about 50 percent of clients due to the impact of the recession on the building industry. The firm has become heavily involved in mission critical work including data centers, hospitals and medical offices. “Mission critical work is typically contracted directly,” explains Almond. “We actually have an architect as a consultant on our team in many instances.”


Becoming Mission Critical

Mission critical work involves buildings which require uninterruptible electric power and cooling systems, largely centered on the functionality of many servers, computers and other technologically advanced equipment.

“My big passion for several years now is called net-zero energy buildings—buildings that consume a certain amount of energy over the course of a year but produce the same amount of energy, as well,” offers Pehl. “It starts with efficient design and ends with solar panels.”

“There are currently only 29 buildings in the United States that perform at net-zero. Optima is currently working on North Carolina’s first such building—Sandy Grove Middle School in Hoke County. This one will actually produce 15 percent more energy than the building consumes,” says Pehl. “To me, that’s where we go as a society.”

Coincidentally, Pehl adds, the military is extremely interested in this technology so they won’t be dependent on the utility companies and vulnerable to security and reliability issues.

“It definitely helps to work with like-minded architects and builders because it’s not just the design but also the methodology,” says Pehl. “To build a clean building you need a ‘bring less on/ throw away less’ mentality.” The aim is for a dust free site which protects duct work and electrical systems.

“You have to realize that there is a lot of cost savings involved,” says Pehl. “We do a lot of education for our clients.” Many efforts, such as recycling, result in side industries. Pehl cites the development of a sheetrock recycling plant which lowers the cost of sheetrock: “You can pay by the pound to throw things in the landfill or get paid to deliver it to another building site.”

Optima Engineering designs dashboards for buildings which monitor and display energy usage by the minute, hour, day and week, etc. “It shows you exactly where your problems and issues are, the number of kilowatt hours being used,” says Pehl.

The firm’s work supports Duke Energy Carolinas’ Envision Charlotte program which is a national model. The kiosk uptown displays the results collectively for all the buildings in uptown. The purpose of the program is to reduce electric usage through awareness of usage. The goal is to see a 20 percent reduction in five years.

“The information affects your behavior,” attests Pehl, who likens the experience to his car, a Toyota Prius, which provides drivers with mileage efficiency information. “I used to be a very lead-footed driver. Now, if I’m not getting 50 miles per gallon, I’m mad. The dashboard has slowed me down. The dashboard does the same thing with a building.”

While there is an upfront cost to having a building dashboard, it’s very insignificant compared with savings, according to Pehl. “If it costs $55 million to build a school and the electrical system is $5 million of that, the dashboard will likely cost about $20,000. If they save five percent of their electrical costs, they have paid for it in six months.”

The work of the 35 Optima Engineering employees is divided about half and half between electrical and mechanical engineering (including plumbing and HVAC—heating, ventilation, and air conditioning). Approximately half of the staff is comprised of engineers.

Optima Engineering has taken on an increasing role in consultation and education. Once per month existing and potential clients come to the firm’s office to attend Optima University, a lunch and learn program which teaches about sustainable building and design. Accredited by the American Institute of Architecture, architects can earn needed continuing education credits.


Growing Together

“We’re not the stereotypical geeky, pocket protector-wearing engineers holed up in their offices,” says Daley, with a smile. “There is a strong emphasis here on communications, both written and verbal; we try to bring every client along on sustainability and that requires teaching.”

Both Pehl and Almond thought they were going to become architects. For Pehl, the moment of truth was when he went off to college at North Carolina State University and saw the solar house installed there.

“I’ve always been fascinated by solar energy,” says Pehl who went on to earn his degree in electrical engineering. Pehl practices what he preaches in his personal life. His home in Denver, North Carolina features solar roof panels and a geothermal heat pump which uses wells in the ground. He also installed solar panels on the roof of the LEED certified building that houses the Optima Engineering offices on South Tryon Street in Charlotte. The firm, which owns a portion of the building, has occupied space in it since 2008.

“I’m a little too optimistic sometimes. My partner, Ron, grounds me,” says Pehl. “He wasn’t sure about the panels on the roof but six months after we put them up and were receiving a check every month from Duke Energy, he said “We need to expand this.””

Almond earned an associate degree in architectural technology but couldn’t find a suitable job. “No one was hiring so I went to work as a draftsman for a mechanical engineer. I was soon hooked and went back to school at UNC Charlotte for a degree in mechanical engineering.”

A high school internship in mechanical/electrical/plumbing engineering solidified Thompson’s interest in the field. He graduated from UNC Charlotte with a degree in electrical engineering.

Daley’s interest in engineering stemmed from childhood. “I skipped the fireman and astronaut phases. I always wanted to be an engineer.” Daley completed his degree in mechanical engineering at Ohio University.

Optima Engineering’s leadership has strong ties to the community and participates in numerous programs to give back. Some of these are: the ACE Mentoring Program, West Charlotte high School/Phillip O. Berry Academy of Technology; South Mecklenburg High School Engineering Advisory Board; Friendship Trays; and the Make a Wish Foundation.

Pehl credits diversification as key in weathering the economic downturn of 2008-2009. Plus, the firm’s core product was, and still is, mission critical work which was never really impacted by the recession, according to Almond.

“The firm’s focus on sustainable building has allowed us to weather the storm economically better than some others,” echoes Thompson. “I see that sustainability is not going away with rising energy costs. People will always be looking to save money.”

The firm is doing more adaptive reuse projects now and pursuing net-zero usage through mixed use buildings in urban areas situated to share energy. Plus, the sustainability industry has created the need for maintenance over time which increases business.

“We do a lot of sustainable work in the Triangle Region so we’re planning to expand to Raleigh next year,” says Pehl. The firm is also considering Greenville, S. C., and Atlanta, Ga., as additional office sites.

The partners have been diligent in raising a second tier of leadership and developing a succession plan. “You see so many firms where engineers work until they’re in their 70s and 80s and then shut the door,” says Pehl. “That’s not us.”

“I’m very proud of the way our firm has evolved over the years to be a leader in the field,” says Almond. “We grew slowly and did a good job along the way.”

Like the business he’s founded and runs, Mike Bishop’s friendly and unassuming exterior overlays a rock solid core. He’s a quiet man in a white polo shirt, concerned about his friend who recently experienced a family loss, and conversant on topics of the environment and community service. But under the humble, people-focused exterior is a gutsy businessman who has driven significant innovation and growth in the Charlotte region since 1998.

His company, Blue Max Materials, may seem unassuming and “earthy” at first, but a quick survey of the surrounds yields an impressive array of all materials earthen. Although the company got its start selling dirt, rocks and sand, it has morphed to provide materials, ideas and support for everything from environmental projects to the construction of large outdoor living spaces.

The company has innovated technologies and products as well as customer-friendly approaches to keep it growing throughout the economic turmoil that has repeatedly plagued the construction industry.

Bishop founded the company with another partner, Denton Williams, to meet a need they saw in Charlotte in the 1990s. With his background in the aggregate industry, Bishop observed contractors and landscapers pulling into quarries to pick up materials for their jobs. He watched them maneuver their little trailers among the monster trucks and giant construction equipment of major construction companies. It was very time-consuming, inconvenient, and downright dangerous.

Furthermore, gravel, dirt and other supplies were loaded “by the bucketful” at other existing material yards, which meant that they were not measured in any meaningful way. Buyers had no way of knowing whether their particular “bucketful” would have enough material for the job. If not, they would have to return to the supplier for another load.

Williams and Hickman agreed that there must be a better way. “There was a need for a reputable company to come into Charlotte and be able to handle those size customers,” says Bishop. “To get them in and out quickly, do things at an affordable price and with good service.”

By 1997, the partners had purchased a location on Westinghouse Boulevard and stocked it with fill dirt, compost, gravel, and sand. The operation ran out of a small trailer, manned by Bishop alone.

Though their February 1998 opening was humble, it represented a significant shift for the industry. Blue Max Materials boasted something that very few mid-level bulk materials suppliers offered at that time: accurate measurements. From the start, they installed a truck scale to measure each load. The innovation introduced legitimacy to the industry, and enabled buyers to accurately estimate jobs.

Although Bishop describes his company’s growth mainly in terms of meeting customer needs, he admits that the innovation was a good business move for Blue Max Materials too, allowing for accurate inventory controls. The company’s safe environment and convenient locations have been a winning combination that has made Blue Max Materials a popular stop for contractors and landscapers.


Paving the Way

Though success came early and quickly for Blue Max Materials, it was not without challenges, chief among them, says Bishop, lack of staff.

“In the beginning, there were days when a customer would come in and tell me what he wanted, and I’d lock the door, go out and load him up, then run back down, weigh the customer out, and collect the money,” he laughs. “Meanwhile, the phone was ringing and another customer waiting at the door. It didn’t take long to figure out it was more than a one-man shop.”

In an industry that was notorious for hiring inexpensive labor, Bishop decided that they would distinguish themselves with a friendly, helpful staff.

Customers loved it. The building and contracting industry was in boom mode in Charlotte, and Blue Max Materials grew quickly. Within a year and a half, customers were asking for more. In addition to bulk products that they could load in the back of a truck or trailer, they wanted hardscape supplies: pavers, retaining wall materials and natural stone.

By late 1999, Blue Max Materials had teamed up with the well known hardscape supplier, Belgard Hardscapes, a division of Oldcastle Building Products out of Greensboro. Oldcastle provided not only high quality product lines like Belgard Pavers and Keystone Retaining Walls, they also brought aggressive research and development, a strong marketing presence, and training opportunities for customers. In partnership with Oldcastle’s “Belgard Universities,” Blue Max Materials started offering development opportunities for landscapers to learn the business of hardscape.

The partnership changed Blue Max Materials; it brought name brand recognition. Commercial landscapers and installers joined the base of customers, which had been primarily general contractors. Expanded training helped develop new landscapers and gave established landscapers new opportunities to grow their business.

It also opened the door to Blue Max Materials’ partnership with other divisions and products from Oldcastle’s comprehensive building products lines. Blue Max Materials is now recognized as one of the largest independent Belgard Hardscapes dealers in the Southeast.

By the end of 2000, Blue Max Materials had firmly established itself as a one-stop shop for general contractors and landscapers in Charlotte. Then in 2001, everything changed again. The 9/11 terror attacks and aftermath brought about an industry shift that turned out to be a business transition for Blue Max Materials.

“We were just really cultivating some of these contractors, and helping them out, when suddenly people decided to stay home and spend their money at home, as opposed to taking vacations,” explains Bishop. Everybody wanted the comfortable, easy access to materials and ideas that Blue Max Materials offered, and business boomed. Blue Max Materials enjoyed several years of growth, adding new product lines, cultivating both suppliers and customers, and further expanding their location in Indian Trail.



But when the bottom started falling out of the economy at the end of 2008, contractors were among the hardest hit. “We went through some painful times,” admits Bishop. “Contractors were having trouble collecting on projects, and in turn we were having trouble collecting from them.”

Simultaneously, new business from general contractors dropped off and the magnitude of projects fell severely.

Meanwhile, a new, vastly different market started to open up. Homeowners wanted to save cash by doing projects themselves, and they were showing up at Blue Max Materials wanting to buy materials. Bishop explains that homeowner projects tend to be smaller than general contractor jobs, and they don’t come with the built-in repeat business.

“Plus, educating a homeowner is a whole lot different than a contractor coming in and telling us what he needs for a job,” says Bishop. “We enjoyed it, but it did require more people for us to provide that level of guidance. We saw that we had to change the way we were doing business.”

The new environment meant lean times for Blue Max Materials. But the challenges came with gifts as well. Homeowners pay with credit cards and checks instead of invoices, so payment was always prompt and reliable. Blue Max Materials learned new cash flow management practices—running background checks and extended credit checks, tightening up invoicing procedures.

With a changed business model in mind and looking forward to future economic growth, Blue Max Materials made the bold move in 2010 of purchasing 40 acres near the original facility on Westinghouse. Ground was broken in 2010, a brand new 7,000-square-foot storefront and a 15-acre materials lot opened for business in September 2011, and in October 2012 a grand opening unveiled an Outdoor Living Design Center.

At first glance, it’s hard to believe the beautiful facility was built amid one of the toughest economic times to ever hit the industry. A concrete paver drive curves gently uphill to reveal a stunning waterfall cascade, a stone-faced building, and an enticing cobble path leading up to an inviting pavilion.

And, like so much else about the company, the facility is more than just a pretty face. Its user-friendly amenities amply reflect an increasingly important innovation in the construction industry: green building.

The gracefully curving paver drive represents the latest in water-permeable paving surfaces suitable for both residential and commercial applications. Its deceptively quaint appearance belies its toughness and practicality. Hundreds of tons of materials travel across those pretty little pavers on a daily basis, carried in heavy dump trucks and tractor trailers, sometimes as many as a 100 a day, that would punish the toughest pavement.

Under the 15,000 square feet of permeable pavers lays a base made of layers of incrementally larger sized clean gravel. This base combined with the attractive gravel filling in the gaps between pavers simultaneously allow water to flow through the gravel while filtering contaminants out of the water before releasing it into the groundwater. The system is so effective a fire truck can pump water into the parking lot without flooding or run-off.

Bishop says the permeable paver systems may have a slightly higher up-front cost, but on the other hand, they have a 50-year life cycle and can be designed to harvest storm water and reuse it for irrigation. They also provide a cost-effective and sustainable alternative to the bio-retention ponds that developers are otherwise required to install next to new parking lots, allowing property owners to develop this previously unusable acreage. For those who do choose to install a bio-retention pond or a rain garden, Blue Max Materials supplies and blends the products for those as well.

The Blue Max Materials demonstration of green building materials doesn’t stop at the curb. The main building’s gracious look is in part due to the masonry facade that covers the showroom exterior. This beautiful stone is actually a man-made product from Oldcastle called EnduraMax that installs without the need for a skilled mason, as easily as fitting a jigsaw puzzle.

It includes an R-13.5 value insulation foam on the back side and can be used in new installations or to provide a face-lift and better insulation to existing structures. It was recently voted one of the top 50 new products in the green industry.

Inside the building, an attractive lobby and a friendly receptionist greet visitors. Displays of building materials line the aisles, and skilled staff assist customers in making plans and selections. Among the offerings are many additional green materials, including all the supplies necessary to build green roofs.


Advancing Outdoor Living

By far, the most arresting innovation Blue Max Materials has brought to the community is its Outdoor Living Design Center, a beautiful ever-growing installation that attracts visitors from around the region. The center greets visitors with a stunning stone marker and stone steps leading up to a winding pavilion, complete with covered outdoor kitchens, grills, fire pits, lighting, waterfalls, and a peaceful koi pond.

Each element of the installation is accompanied by signage outlining what materials were used and who designed and installed that section, making it a useful tool for homeowners as well as designers and their clients.

The Outdoor Living Design Center is made possible by partnerships with landscape contractors and outdoor appliance and furnishing companies in the region who work with Blue Max Materials to select materials and create designs to fit the overall space. These masterpieces serve as a year-round business source for the landscapers, an idea center for visitors, and a place for contractors to bring clients to demonstrate concepts and choose materials.

Blue Max Materials hosted October’s grand opening and charity event in the space, in partnership with Hands On Charlotte, with chefs from Johnson & Wales and local restaurants, live music and demonstrations. Blue Max Materials also offers the Outdoor Living Design Center space as an event location for community organizations and other interested groups including those they already support like the Eagle Scouts, Alexander Children’s Network, and Thompson Child and Family Focus.

As Blue Max Materials has grown, they have not gone without official notice. For instance, they worked in partnership with the City of Charlotte to create a planting medium based on soils and sediments native to our area, resulting in Garden Max, a good economical product that is now used in city streetscapes. The product attracted the attention of Daniel Stowe Botanical Gardens, which uses Blue Max Materials products throughout their plantings. They also partner with the U.S. National Whitewater Center for many of their materials needs.

Bishop, who serves as managing partner and 50/50 owner with one of the other founders, says that he does not expect massive growth for his industry or company in the next few years. The economy is still too uncertain. But he is cautiously optimistic and continues to look for new and innovative ways to serve his customers.

Expect a conservative approach to growth from Blue Max Materials, as its founder continues to focus on the rock solid core that underlies its heavenly exteriors.

It was the height of the Gulf War. U.S. Marines were preparing for the ground invasion of Iraqi-controlled Kuwait but they faced a deadly obstacle. The Kuwaiti beach was lined with razor wire and land mines. A hundred yards up, a string of machine guns, backed by artillery, aimed toward the shore. Without intervention, the Marines faced unnecessary casualties.

“We worked 18-hour days for two months,” says Jerry Snyder, “and built a rocket device. Carry it to the edge of the minefield, pull its pin and the rocket flies over the land mines laying down a huge rope of explosives that cuts the wire, shreds the land mines and clears a safe path for the Marines.”

The mission was a success and more significantly to Snyder, no Marines were lost in the assault. “I wanted to make a difference,” he says.

Making a difference is a philosophy that follows Snyder throughout his career. Snyder is founder and president of Advanced Mission Systems, LLC, a company that specializes in technical surveillance and physical, personal, electronic and cyber security. The company, which he began in 2006 on the edge of Charlotte, is the logical outgrowth of a background that seems pulled straight from the latest military thriller.

With a B.S. from Ohio State University in aerospace engineering and a master’s with honors in systems engineering from John Hopkins University, Snyder has more than 25 years’ experience leading the development, delivery and training of systems and advanced technologies for the federal government.

During his 10 years of service as a federal government employee, he led “tiger teams” deploying special equipment to destroy land mines, developed remote sensor systems to assist in reclaiming U.S. training ranges in Panama, and worked with the military in many special operations and clandestine and covert exercises.

In the private sector, Snyder has led the development of special communications for the U.S. Army Communications-Electronics Command and also the development and delivery of counter-IED (improvised explosive device) systems which made a difference by saving a reported 1,500 U.S. Marine lives in Iraq and Afghanistan.

Snyder began Advanced Mission Systems (AMS) with a number of colleagues from his years in government service and continues to work with people and partners around the globe that fit his most important criteria. “We always look for the best people with the best experience,” he explains. “We have partners in South Africa; we have suppliers from Israel, Russia and Germany; we do training in the U.K. We use the best in the industry and get them to work as a team.”


Engineering, Product Development and Training Ops

In 2009, Snyder transitioned AMS from a consulting business into an engineering and product development company. The new focus gave Snyder the ability to fill a significant need.

“I had friends in Special Forces who couldn’t get equipment they required because it was too expensive,” Snyder explains. “Wherever I went at Fort Bragg, they asked me if I could build this or make that. A lot of special operations needs are small—they cost a couple of hundred or a few thousand dollars. A billion dollar company isn’t interested in that kind of business, but we can help them.

“Typically, the military buys equipment that’s expensive and often antiquated because it takes four to five years to become an accepted piece of equipment. We do it differently. We use commercial components and build custom equipment from them so we can develop a remote camera or a listening or tracking device from what comes out of a typical cell phone. We can use what’s being developed for other industries, like the medical or multimedia industry and integrate it into products. This allows us to turn around a product line quickly. Our development time is normally less than six months.”

AMS’s first product was a global tracking device which allows real-time tracking of people or assets. Its effectiveness and easy to use design make it a favorite among special operations forces but Snyder says the best part is its competitive price. “There’s not one item we sell that isn’t one-fifth the cost of what the military is currently paying for a comparable device,” he says.

In addition to an array of tracking equipment, AMS also offers a wide range of technical surveillance products and services.

As part of a team, AMS recently won a contract to deliver all the technical video surveillance for the Department of Homeland Security. Under the contract called “Tech Ops,” non-Department of Defense government offices can purchase the latest in technical video surveillance equipment.

Snyder explains that there is a “push and pull” when it comes to product development. “Our clients definitely come to us and ask us to design and build something to fit a specific need, but often, we also find something interesting and tell them how it could be of use to them. It’s a continuous back and forth.”

And while AMS’s early business model focused on building equipment they soon realized something that substantially changed their business. “We were delivering equipment but our customers had third parties training them on it. It was so frustrating to get a call from overseas that our device wasn’t working when training issues were to blame. We realized that equipment without training was useless.”

Training is now more than 50 percent of the AMS business. Training on the equipment is part of that percentage but AMS also offers a variety of operational training.

AMS employees are a large factor in that good relationship. Not surprisingly, about 50 percent of employees are engineers—electrical, software or system engineers—and retired Special Forces and former FBI agent are also on the payroll.

“The company is now how I’ve always wanted it,” Snyder says, “high caliber engineers who can build things like a ‘MacGyver’and senior NCOs with 20 years of operational experience. The NCOs tell the engineers what they need to build and how it should work. The engineers then build it and our operators, the retired Special Forces people, will deliver the equipment and perform the training.”


Security Across the Board

And while the majority of AMS’s current business is with the military or government agencies, they believe that their products easily translate to law enforcement and even commercial and individual use.

“Our equipment and experience has direct application to law enforcement so we want to get the word out to police departments, the DEA and U.S. Marshalls,” says Snyder, “but we want people to know that we also have training and equipment that can protect corporations.

“Companies spend tremendous effort and money on security. They invest in cyber security with firewalls and anti-virus software, and physical security with cameras and door swipes, but a single employee can compromise all of that.

“We were looking into security for a client once and discovered that each afternoon an employee was tweeting from the company parking lot. Mobile tweeting links your tweet with a location so we were able to identify the employee and were able to check out their personal information on Facebook, other websites linked to Facebook, like an online dating page and public records. Within two hours we knew basically everything about them. Given many people use personal information to create passwords, we potentially had access to that company’s computer system—all from a tweet.

“It’s just awareness. Educating your employees on what not to do is as important an investment as other security measures. And AMS can provide training or products to any company whether they are setting up a security system or evaluating the system they have. We can define requirements, recommend procedures or even test the system they already have.

“We have what we call a ‘red team’ that can try to break into your system and identify vulnerabilities. We train on how to protect your device, your local network and your server.”


Safe Travels

The company’s push to develop commercial applications for their products and services gets a boost when they launch their newest product at the beginning of next year. The idea for the app, called the Global Travel Assistant, grew from an emerging and disturbing trend.

Snyder tells how it came about: “We started seeing reports of business executives traveling overseas who were being kidnapped and held for small ransoms. Business is more and more global which means corporate overseas travel is on the increase. Everybody’s jumping on a plane without knowing anything about their destination and without resources to assist them once they get there.

“Many AMS employees have traveled thousands, if not millions, of miles over their careers. We figured that with all of our experience and our technological capabilities, there must be a way we can make this travel safer.

“The Global Travel Assistant is a really innovative app that we’re building for the iPhone or iPad. Its foundational function is tracking people as they travel overseas, but we decided to take the knowledge, experience and resources of the company and add that into the app too.

“It can start with getting you safely from the foreign airport to your hotel. We can vet trustworthy transportation companies. We can put information about your driver on your phone so you can walk out of the airport and pull up a photograph of your driver to check it against who’s waiting for you. We can give you their cell phone number so you have an additional way to confirm their identity. We can even provide a plug-in for your phone to verify fingerprints, if that’s what’s needed.

“After you’re in the car, the app will tell you what the safe routes are from Point A to Point B. Danger zones are highlighted on a map. If you start migrating toward those areas, the app can provide you with directions away or give you emergency numbers for law enforcement or the State Department. We can even arrange a local contact in the area who can be of assistance should you need help.

“Real time information, from local databases, can tell you what’s going on in the area and local alerts warn you what to watch out for. We can handle all the security needs of an overseas traveler, from the most basic to the most comprehensive.

“The Global Travel Assistant can also be of tremendous value to a college student studying or traveling overseas or even tourists on vacation. Our goal is to make it affordable for the individual who wants to buy a subscription for a few weeks or an entire summer while they travel, but also to offer extra features and functionality a corporate traveler might want and need.”

Snyder says AMS will continue to expand its products, training and markets as it moves its headquarters into a new, larger building in the Whitehall area of Charlotte at the end of the year. Its satellite office in Fayetteville, N.C., serves their customers at Fort Bragg and Snyder is looking into the possibility of a satellite office in the southwest to assist the U.S. Border Patrol.

His criteria for additional offices, products and training is simple: “We look for a need,” Snyder says. “We want the things we do to make a difference.”

Carolinas HealthCare System is using big data to yield big insights. By transforming the way it interprets data, it hopes to benefit patients and the community as well as the health care system.

In an initiative to use data such as clinical and financial information to predict local health needs and identify opportunities to improve care, they hope to mine data to identify challenges, define problems, and target solutions, in an effort to become an industry leader in advanced analytics and business intelligence.

To further that initiative, CHS created the Dickson Advanced Analytics Group in January, consolidating nearly 90 employees with specific data expertise into one department. The analytic group’s efforts are currently focused on the CHS’s metro hospitals. Carolinas HealthCare owns, leases or manages 33 hospitals in the Carolinas.

Through this initiative, CHS hopes to meld clinical data with financial information to focus on service lines that can be improved, and to help the health care system to be more assertive in adopting new strategies or adding services, rather than waiting for problems to arise.


Dickson Advanced Analytics (DA2)

“We see advanced analytics as a key strategy to enhance the value of our care,” says Allen Naidoo, Ph.D., vice president of operations at Dickson Advanced Analytics Group, or DA2, the preferred acronym for the CHS’s new big data analysis center. “This type of approach enables Carolinas HealthCare to be more assertive.”

He cites the additional example of the CHS app alerting users to the less busy of the system’s 21 urgent care locations. This simple, timesaving and possibly lifesaving application is but one of DA2’s early results.

“There are a lot of sophisticated algorithms involved in the wait time application,” says Michael Dulin, M.D., medical officer for analytics and outcome research at DA2.

Located in the former AAA Building on East Morehead, DA2 has only been in operation since February 2012. It is the successor organization to the R. Stuart Dickson Institute for Health Studies, an interdisciplinary and collaborative program of applied research and public health studies.

Naidoo, is responsible for the integrity of the massive data collected at DA2. Trained as a biostatistician, Naidoo likes the emphasis on statistics and analytics. Michael Dulin, who has a private practice in family medicine in addition to his work at CHS, insures the accuracy of the center’s clinical data.

Naidoo, age 48, came to CHS in May after a career in health insurance. “I’m beyond the term ‘big data,’” he says. “It is a thing of the past. I like to talk about big insights from data. Companies can have big data, but lack the computing and people power to do something with it.” At DA2, Naidoo and his team of specialists are taking big data to the user level. That often means the physician, nurse or nurse’s aide working at the patient’s bedside.


Best Practice Protocols

One of the first assignments given DA2 was to reduce the hospital readmission rate for elderly patients by 20 percent by the end of 2013. Using data collected from 11 home health agencies and statistical tools that isolate primary and secondary predictors, DA2 discovered the most salient and preventable determinant of readmission.

“The number one predictor was whether patients were adhering to their oral medications,” he says. “Those who had their medications carefully monitored by their home health care worker had the lowest readmission rates. Those on their own with a medication list and little else had the highest.”

Based on these findings, Naidoo and his team developed best practice protocols for all 11 home health agencies. When workers spent more time on oral medication instruction, the result was 200 fewer unnecessary readmissions, a six percent reduction. That Big Insight saved CHS over $2 million and helped improve the quality of life for 200 elderly patients who would prefer to stay at home.

Admittedly, big data is relatively new for CHS. As little as three or four years ago, medical data were handwritten on paper charts. Today, that’s all changed. Transcription software has made electronic medical records more accessible, whichs make diagnosis, treatment and outcome data more accessible and easier to analyze.

DA2 integrates vital clinical data with billing information, data from dozens of federally-mandated registries with prescription data and community data like address and English proficiency with psycho-social data such as patient satisfaction, age and sex. Thanks to Medicare and Social Security, physicians and patients have unique identifying numbers that are also entered into the mix. As Naidoo points out, that’s a lot of big data begging for big insights.

The statistical software DA2 uses to analyze their data was developed at North Carolina State University. Software Analysis Systems or SAS (pronounced sass), located in Cary, N.C., originally developed analytics programs for agriculture research. Today SAS is a major player in the business intelligence market and hospitals are some of its best clients.

The heart of DA2 is the Enterprise Data Warehouse, a concept developed in the late 1980s by IBM. A data warehouse gives DA2 a centralized, consistent and unified view across the entire hospital. To date, DA2 has a 1.5 petabytes of data in their warehouse. From this massive storehouse managers produce white papers, graphs and dashboard reports for physicians and administrators.

But that’s not its real strength. That comes from queries and forecasting—asking it intriguing health and business questions and having it build alternative, futuristic care models.


Polychronic Patients

The hospital’s polychronic patients are a good example of the potential of the CHS data warehouse. Polychronics are typically elderly people with multiple chronic illnesses such as diabetes, congestive heart failure, coronary artery disease and asthma. Some are dually enrolled in Medicare and Medicaid—they are elderly, poor and chronically ill. Because of their multiple needs, polychronics consume approximately 80 percent of the hospital’s health care dollars and resources.

“These are patients having a tough time controlling their diseases,” says Dulin. On the plus side, they are a small group, less than 20 percent of all patients. In its data warehouse, DA2 has information on over 60,000 diabetics and 20,000 asthmatics.

By querying the data warehouse, DA2 staff can isolate the polychronics and build model treatment scenarios that lower the cost of their care while at the same time personalizing it. One innovative model mobilizes a corps of human resources and recruits them for the treatment team.

CHS staff coordinates and monitors the work of nurses embedded at the YMCA, home health agencies, hospice workers, families, friends and pharmacies. These medical and non-medical groups support the care plan, provide advance warnings of patient improvement or deterioration, keep the physician manager in the loop and help lower costs. They also provide warm fuzzies like encouragement, hugs and friendship. The medical staff provides all of the treatment oversight and care decisions.

Wait, there’s more…Using the DA2 data warehouse, CHS now sends lists to area physicians of their high risk diabetic patients. The list notes those that smoke, have elevated blood pressure and need their medications refilled.

“As a doctor, I look at the list and have my nurse call the 20 or so patients, ask them to come in for an appointment, get their medications refilled and remind them to quit smoking,” says Dulin. “We are using the DA2 data proactively to help patients stay healthy.”


Limits, Challenges and Concerns

All this emphasis on complication prevention, early action, proactive care and readmission reduction improves quality of life for patients, but not necessarily for the hospital.

“We are penalized to some degree for working on these quality initiatives,” says Dulin. “When you keep people healthy, you keep them out of the system and hurt the hospital’s revenues. We are not recognized for that under our current reimbursement system.”

As DA2 operation officer, Naidoo is troubled by personnel shortages. “It is a challenge to find qualified people to assume the key roles at DA2. Statisticians are not available; epidemiologists, not available; health economists, not available; biostatisticians, not available,” he says.

Academic doctorates are not staying at universities to teach, but Naidoo says, “They are being picked up by industry. With professors in short supply, the United States is not producing enough graduates in math and the computational sciences.”

In a 2011 report, McKinsey Global Institute, the business and economic research arm of McKinsey and Company, also focused on the talent shortages in big data. “The United States alone faces a shortage of 140,000 to 190,000 people with deep analytical skills as well as 1.5 million managers and analysts to analyze big data and make decisions based on their findings.” No wonder DA2 finds so many talent sectors unavailable.

Other issues concern the completeness of the data warehouse. “We aggregate data, but not all systems are involved,” says Naidoo. “There is a ton of data sitting out there untapped.”

In their 2011 report, McKinsey Global Institute raised the issue of data discarded by hospitals. They estimated that the United States health care industry discards 90 percent of all the data they generate. That’s a figure Dulin finds surprising.

“We don’t discard a lot,” counters Dulin. “We hold on to videos and imaging data like MRIs and CT scans. It might be that 90 percent of our data were not actively utilized in some type of report or study, but it’s not discarded.”


The Future of Big Data

In the next few years, big data will help lead the charge on greater transparency and reduced health care waste.

Americans have had access to their credit reports for years—why not their medical records since many are electronic files?

“Physicians are a little scared of that type of transparency, but I think it will be good for us,” says Dulin. In as little as a year to 18 months, Dulin envisions patients logging on to a secure Internet portal to view their most recent lab reports and physician notes. He predicts that transparency will result in greater patient autonomy, fewer data errors, enhanced doctor-patient communication and more shared decision-making.

A study published in September by the Institute of Medicine estimates that the United States health care system wastes $750 billion each year. Thirty cents of every health care dollar goes to unnecessary services, inefficient delivery of care, excessive administrative costs, inflated prices, prevention failures and fraud.

Both Naidoo and Dulin agree, many of these waste categories—especially unnecessary services and inefficient delivery of care—could be reduced if hospitals put their big data to work finding more best practices.

In the not too distant past, data were small and manageable. They (“data” is a plural word like numbers) were easily manipulated with a calculator or pencil and later by a computer. Small data were structured bits of information like tally marks, sales per quarter and percentages. All that information resided comfortably in a database until it was made visual by graphs and pie charts.

Big data differ from older, more familiar and traditional small data in four significant ways.


Volume: Walmart collects enough data in an hour to fill 50,000,000 filing cabinets. That volume exceeds the processing capacity of conventional databases. Without specialized software, storage, processing and querying capacity there is just too much big data to make sense of it all.


Velocity: Thanks to the Internet and mobile phones, all that volume is not just picked up and recorded. It streams into business systems on a river of bits and bytes. To be effective, business response must stream out equally fast.

After a terrorist attack in 2004, Madrid, Spain, completely revamped its emergency system. With big data monitoring points throughout the city, it is able to answer 81 percent of its police, fire and ambulance calls in less than eight minutes. That’s an extremely fast and tight feedback loop for a metropolitan area of over 230 square miles.


Variety: Some big data are tidy and structured like its smaller counterpart. These include a wide variety of test scores, financial data, personal information and the results of our last physical. Most big data are formless, messy, unstructured information like user clicks, GPS readings and social media text messages. If there is meaning here, it is not obvious. If there are trends, they are obscured by so much noise. Those who handle big data are able to extract meaning and importance from what resembles your grand-parent’s cluttered attic.


Veracity: Big, fast and formless data are also uncertain data. Uncertainties arise from incomplete data, entry errors, processing problems, sensor inaccuracies, social media, latency of information, modeling approximations and plain old deception. When big data managers speak of ensuring data quality, they are referring to its inherent lack of veracity.


A New Life Example

In the era of small data, scientists claimed in any discussion that, “Data wins.” Those with the numbers, observations and statistics trumped those that speculate from their cubicles. Today, the technology of information has expanded the old mantra; it is now, “Big Data wins.”

Here’s an example from the popular retail department store, Target that put it and statistician Andrew Pole in The New York Times Magazine and Forbes. Pole’s unique contribution to big data was that he developed a pregnancy predictor algorithm from Target’s purchase tracking card, the Guest ID, demographic data and Target’s baby registry database.

As every parent knows, pregnancy changes everything. What Target knew was that pregnancy changes and solidifies shopping habits. Pregnant women became company-loyal parents.

Pole and his team at Target’s Guest Data and Analytics Services examined all the purchases made by thousands of women who signed up for the company’s baby registry. Probing all the data at their disposal, Pole noticed the products these women purchased early in their pregnancy. The list included unscented lotion, vitamin supplements, hand sanitizers, scent-free soap and washcloths. Further study expanded the list to 25 key items.

Through statistical and other analytic tools, Pole could predict from a woman’s purchases and demographic data if she was pregnant and, within a small window of error, her due date.

He then applied his pregnancy predictor to every regular female shopper in Target’s national database. The result was a list of tens of thousands of women who were most likely pregnant. From its Guest ID data, Target knows exactly how to use coupons and ads to trigger purchases for each of those shoppers.

They then send coupons via mail, email or to the checkout counter for pregnancy- and baby-related items to women with high potential pregnancy scores. The coupons are a reminder that Target has what pregnant women need at each stage of their pregnancy and when they became mothers.

In order to avoid the charge that Target was spying or invading their privacy, the newborn-related coupons were mixed with neutral discounts.

As The New York Times Magazine reported, in 2010 Target’s Mom and Baby sales increased dramatically and Pole was promoted.


How Big is Big?

Like maternity sweatpants, digital data are produced in a variety of sizes—small, medium, large, XL and Big. Knowing the digital data prefixes is an integral part of Informatics 101.


  • Kilobytes: This article contains approximately 40 kilobytes of information. A kilobyte is 1,000 bytes and this article is 40 times that figure. A byte represents one character such as a single letter in this sentence.


  • Megabytes: A good high resolution digital photograph suitable for framing at a large size would ordinarily contain one megabyte or more of data. That’s one million bytes.


  • Gigabytes: Seven minutes of high definition television? That’s a gigabyte or one billion bytes.


  • Terabytes: The total Internet traffic for the first quarter of 1993 was a terabyte or one trillion bytes. Today, the amount of Internet data used in one second exceeds four terabytes. In a 2011 report on big data, McKinsey Global Institute estimated that by 2009, nearly all sectors in the United States economy with 1,000 or more employees had, on average, 200 terabytes of stored data.


  • Petabytes: A petabyte or 1,000 terabytes is what Google all by itself processes each hour.


  • Exabytes: This year, one exabyte of digital data or one million terabytes is created every 9.6 hours by the vast worldwide array of electronic devices.


  • Others: There are further extensions such as zettabytes and yottabytes all useful and mind boggling descriptors quantifying the enormity of big data.


Despite the ease of finding everyday examples of terabytes, petabytes and exabytes, these large datasets are beyond the ability of ordinary software to capture, store, manage and analyze.

McKinsey Global Institute states flatly, “We are generating so much data today that it is physically impossible to store it all.” These facts of digital life today make the old maxim, “You can’t manage what you don’t measure,” even more difficult to put into practice. New tools, new software and especially new skills are needed to mine, manage and salvage big data.


Big Data in the Classroom

Charlotte’s leader in big data education is Dr. Yi (pronounced Yee) Deng. He is dean and professor of the College of Computing and Informatics at the University of North Carolina Charlotte. Deng and his 60 plus faculty members oversee the education of 1,400 computing and informatics majors and grad students, the next generation of technologists and big data miners.

“Every day we generate nine times as much information as in all of the libraries in the United States combined,” says Deng. “Ninety percent of the world’s data have been generated in the last two years.” That’s information from cell phones, iPads, wireless devices, emails and computers plus old fashioned information in the form of reports, messages, television, radio and books. To further drive home the point, Deng adds that this massive data avalanche doubles every two years.


Charlotte Conference

     In May, Deng and his associates hosted a major big data conference at the Ritz Carlton. Charlotte Informatics 2012: Competing + Winning through Analytics attracted over 300 local and regional business leaders. The conference panelists discussed Informatics as it refers to big data, analytics, visualization and a host of other IT-related terms that describe the collection and analysis of data in new ways to drive strategic business insights.

Deng emphasizes that Informatics is one of the most important areas of study emerging today. Then he adds a wakeup call: “Companies that employ informatics in the strategy and management of their businesses are outgrowing and outperforming their competitors.”

To drive home the point, Deng cites a big data example presented at the conference—one closer to home than Madrid’s emergency response system. “Computers can sift through mountains of bank transactions,” he says, “and detect a few odd or questionable ones.” In the past, officials had to visually examine paper records to uncover fraud or the rare money laundering scheme. Today, for bankers armed with informatics programs and visualization techniques, fraudulent transactions stand out like buying unscented lotion at Target.


Supply, Demand, Skills

UNC Charlotte teaches informatics and computer science at the undergraduate and graduate level, but they are not the Queen City’s only big data educator. Northeastern University in Charlotte offers an MBA in health informatics as a hybrid program. Six MBA students currently study big data online and on the ground, says Assistant Dean of the Graduate Program in Computer Science Bryan Lackaye. Speaking about the program in Boston, Northeastern’s main campus, “We can’t graduate students fast enough for the jobs available,” says Lackaye.

UNC Charlotte’s professional science master’s degree in bioinformatics interdisciplinary program would never be confused with an MBA. It emphasizes biology, chemistry, mathematics, statistics, computing, informatics and engineering.

Given such a rigorous program, it is no wonder these multitalented graduates are in demand. “Eighty companies have come to recruit,” says Deng. “Some are hiring 20 to 30 of our grads. Others need two or three. Demand exceeds supply.” Unfortunately, cuts to UNC Charlotte’s budget are only exacerbating the supply of what has become a scarce and important human resource.


Data Science

Note that there’s one key discipline missing from the UNC Charlotte’s current informatics curriculum—business. Deng and Steve Ott, dean of UNC Charlotte’s Belk College of Business, are taking steps to combine education in business and informatics. A new North Carolina Initiative for Data Science and Analytics (NC-DSA) is in place linking the Belk College and the College of Computing and Informatics. NC-DSA rests on three pillars: new interdisciplinary academic programs in data science, state-of-the-art training in big data for working executives and managers, and a industry-university partnership that leverages academic research for business and industry innovation.

“We are in the process of creating a professional science master’s in data science and business analytics,” explains Ott. “We hope to offer it in Charlotte in a couple of years.” A new interdisciplinary professional degree in health informatics, a partnership among the College of Computing and Informatics, the College of Health and Human Services and the University Graduate School, is already being offered this year. Together these education and training programs will produce over 200 grads each year in coming years.

Writing in the October issue of Harvard Business Review, Tom Davenport, who keynoted the May conference in Charlotte, said that currently there are no university programs offering degrees in data science. He noted that North Carolina State is “busy adding big data exercises and coursework” to its master of science in analytics, reflecting the surging demand of talents in this area.

Data science is the new discipline linking informatics and practical applications. “Its practitioners are a new breed,” writes Davenport. “They are a hybrid data hacker, analyst, communicator and trusted advisor.” They focus on the “I” in IT and the “D” in R&D. All are college educated at the bachelor’s level and beyond and conversant with social media.

Some like Andrew Pole at Target are oriented toward the retail sector where they focus on determining what customers need before they know it themselves. Others are car nuts with an eye toward monitoring engine performance, customer satisfaction, social media and shop statistics to reduce repeat repairs.

In short, data scientists will have what Davenport calls “the sexiest job of the 21st century.” He equates this new profession with the “Wall Street quants” (quantitative analysts), physicists and mathematicians who shunned academia for careers with investment firms in the 1980s and ’90s.

When academically trained data scientists reach the marketplace in three to four years, they will join a self-made corps of practical data wranglers. These “grandparents” include D.J. Patil, who co-authored the Harvard Business Review article with Tom Davenport. He is an executive in residence at Greylock Partners in Silicon Valley.

So is Jake Klamka, a physicist who created Insight Data Science Fellowships, a six-week post-doctoral program based in Palo Alto, California. Klamka’s short course bridges the gap between academia and a career in data science. Add Jonathan Goldman, the data scientist that devised the “people you may know” feature on LinkedIn, a virtual space where thousands of data scientists hang out.

For parents needing guidance on post-high school education for their children, Carol Fodell has some advice. She is program director for global university programs at IBM and spoke at the May informatics conference in Charlotte on the topic. “Tell your kids to major in analytics!” she says, “That’s the bedrock of data science—the software and statistical methods organizations use to understand data and manage risk, performance and decisions.”

Even with new programs, more graduates and increased motivation for studying statistics, math, experimental design and visualization, there will continue to be a gap in the United States between high demand for big data talent and low supply. McKinsey Global Institute estimates the gap to be in the area of 50 to 60 percent in 2018.

Whether they come from do-it-yourself post-doctorate programs or UNC Charlotte, data scientists and their big data spinoff occupations are here to stay. A world without computers, smart phones and dozens of yet-to-be-invented devices may be the only aspect of big data that is unimaginable.


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