Friday , December 14, 2018

November 2012

Featured In This Issue

November 2012

BizProfiles

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.

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.”

Natalie Tindol planned and studied to be a cruise director, but the love of her family’s business and the car industry changed her mind. Now she spends her time helping car buyers cruise out of her dealership in Ford and Subaru automobiles.

Through all of the challenges of first-time business ownership, 9/11, a flailing car industry, and the downturn of the U.S. economy, she has led Tindol Ford in Gastonia to be one of the most successful dealerships in the Charlotte region and the Southeast.

“We sell about 180 cars, trucks and SUVs per month,” says Tindol, who is the company’s dealer principal and owner. “We’re not the biggest and not the smallest, but we work hard to be the best.”

Tindol Ford is a full-service Ford and Subaru dealership serving the Hickory, Gastonia, Charlotte and Concord areas. The dealership also includes commercial sales, finance and parts departments as well as a body shop.

 

Family-sized

Many Gastonia area residents will remember Tindol Ford’s early days when Earl Tindol, Natalie’s father, came to town in 1974 and bought the dealership on Franklin Boulevard.

“We were always at the dealership” remembers Tindol.  “There’s lots to do when you’re the dealer’s kid—paint the curb yellow; pick up cigarette butts from the lot. The whole family would go to the dealership after church on Sundays. While Dad would get some paperwork done, Mom would wash the bathrooms and water the plants.” Natalie, then 9 years old, would play with Matchbox cars across the floor with her brother, Chris, when they didn’t have chores.

“By the time I went off to college at UNC Chapel Hill, I was convinced of three things: I was never coming back to Gastonia; never going into the car business; and never living at home,” she laughs.

Tindol completed her degree in recreation administration in 1987 and set out to work in travel and tourism. She found a job with a Florida hotel. The problem was that there was a gap between graduation and the position’s start date, so Tindol decided to come home and work for her father for the summer.

“It was eye opening,” she says. “I saw a different side of the business and liked it.” Tindol decided to give the car business a year, and says she has never looked back since.

Over the next eight years, Tindol worked in every department of the dealership and learned about every position including service advisor, body shop estimator, service cashier, and finance assistant.  “I even learned to change oil and painted the parts department.

In 1995, Tindol was made general manager, a position she would hold until 2001. “Those were really great years. The job was easy and fun because cars were selling; the economy was good and people were happy.”

About the same time Earl Tindol was thinking about retiring, Ford MotorsCompany was suggesting that the dealership build a new facility. The plan became to build the new facility and sell the dealership but, as Natalie pondered what she would do next, she realized that she wanted to stay where she was. In 20012, she bought the dealership from her father.

“I was deep in debt for the first time in my life, and happy about it! I had no idea what I was getting into,” she says, shaking her head.

 

A sharp turn

The first big game-changer was 9/11. After the terrorist attacks and the establishment of The Patriot Act, the federal government laid out voluminous new regulations designed to red flag and prevent further attacks.

“These made buying a car more difficult for the average person and for the dealership,” says Tindol. “What used to take 30 minutes, now takes three hours.”

At the same time, the auto industry was moving into a downward cycle. There was an influx of Japanese and Korean cars. American manufacturers were losing the race for safety, quality, price, technology and gas mileage.

“They took their eyes off the ball,” says Tindol. “In Ford’s case, diversification in investments distracted from the goal of building the best vehicles.”

By 2007 and 2008, credit issues were looming large, banks were getting tighter, and it was much more difficult to get a loan, including car financing. The national SAARS (seasonally adjusted annual rate of sales) rate dropped from a strong 18 million cars per year in 2000 to a low point in 2008 of 10 million.

Although Ford Motor Company was in serious financial distress, it made the decision not to accept federal TARP (bail-out) funds. This decision called for sacrifice on the part of all the Ford dealerships. Tindol Ford’s staff went from 110 to 70.

“It was an extremely challenging time,” remembers Tindol. “But, I had fabulous employees, a great management team and strength in the Lord. I knew that no matter how bad it got, it was going to be okay. Even if we didn’t sell a lot of cars, we would still find a way to stay in business.”

Although she had faith in Ford’s future, Tindol decided to diversify, so she bought the Lincoln Mercury franchise in 2007 and the Subaru franchise in 2008.

 

Rally cry

Tindol attributes the major turnaround of Ford  to the vision of Alan Mulally who arrived as president and CEO in 2006 at a time when the corporation was poised to lose $17 billion. With a new strategy, he made the bold decision of adding $23.5 billion in debt, even as profits were going down, to invest in Ford’s product line. Introducing a “One Ford” philosophy, he reset the company’s agenda to making the best cars and trucks and SUVs in the world. He divested the corporation of everything not related to that agenda.

“He did something that Ford had never done and that’s to maintain the same focus and goal for more than 1 year,” says Tindol. “Now, six years later, we have an incredible turnaround. It’s amazing what one man with a plan and a lot of teamwork can do.”

At the end of 2011, Ford reported $128 billion in sales and earned a net profit of $20 billion. The SAARS rate for the month of September 2012 was back up to $14.9 million; the best performance since the 2008-2009 crisis, according to the National Automobile Dealers Association.

Through the tough times, Tindol took the time to work with her staff to develop the dealership’s core values of integrity, excellence, growth, family atmosphere, and commitment. She maintains, “When you do the right thing honestly and fairly, it pays off.”

Tindol describes her sales process as low pressure. “We’re professional, friendly and respectful and give to people the best information we can. Then, we let them think about their decision. When people have been treated well and the price is competitive, they will come back to you to buy.”

Tindol reports that staff are up to 83 plus 10 part-time positions. These positions are spread out: 30 in sales and finance; 15 in administration; and 45 in service, parts and body shop. “The service side didn’t generate as much activity when sales were going great,” says Tindol. “People would oftentimes buy a new car instead of repairing an older one. When sales dropped, service and body shop rose tremendously.”

 

Showing off

“I would put a Ford vehicle up against any other vehicle and stand tall,” says Tindol.

Tindol will have the chance to do just that at the upcoming Charlotte International Auto Show which is owned and operated by the Greater Charlotte Auto Dealers Association.  Tindol is chairman of the show and she also holds the position of Chairman of the North Carolina Automobile Dealers Association.

The show, which is made up of 100 dealers representing all manufacturers, comes once a year for four days to the Charlotte area to showcase their new models. The equivalent space of six football fields will be filled with automobiles.  This year the 2012 show is Nov 15-18.

“It’s wonderful for the consumer who can see all the new models under one roof and learn about the quality, technology, safety, gas mileage and reliability of each one,” says Tindol. The show also features a “History of the Automobile,” exhibit with about 40 vintage cars, a section for eco-friendly cars and a kid-friendly area for family fun.

The manufacturers are particularly happy to show off their new hybrids and plug-in cars. “Hybrids (gasoline and electric powered vehicles) are increasing in popularity because they are becoming more affordable and more flexible. People want excellent gas mileage, but they also want the peace of mind of knowing they won’t be stranded half way through a trip.” says Tindol. But things are changing. Ford has partnered with Best Buy to install a plug-in station at the homes of new buyers for those autos with electric only options.

The Charlotte International Auto Show has a dual purpose each year. Not only can consumers see all the makes and models in a non-competitive environment but a huge portion of the proceeds of the event go to charity. Dealerships at the show represent a nine-county area and YMCA’s have a presence in each of these counties, so this year the show has chosen the YMCA to receive all proceeds from the Auto Show Preview Event. In addition, the association will distribute Auto Show proceeds to many other charities.

“Through this association we’ll give $100,000 or more every year to over 30 charities,” says Tindol.

In her role as chairman of the NCADA, Tindol serves as a liaison between dealers and the state association and is an advocate for the dealers. NCADA provides support, education and representation to the dealers in the industry.

Equally important to her is the philanthropic aspect of her job with respect to the community.

“We enjoy being community partners and I think it’s a vital part of what we do. If all businesses contributed a little bit it would make the total community stronger,” she says convincingly.

In addition to her professional affiliations, Tindol is personally involved with numerous community-based organizations and their boards. She also co-leads a Girl Scout troop and teaches Zumba at the local YMCA.

Tindol Ford’s biggest competition comes from the Internet. “You can shop 10 dealers in about two minutes,” says Tindol, “if it’s all about price.” Tindol says she finds that potential car buyers need more than that. “For most people, it’s the second biggest purchase they’ll ever make, next to their house.”

Things to consider include help with credit issues, warranty service, and attention from the dealer. “There’s nothing like sitting in it, touching it, feeling and driving it—most people want that. The majority of customers will not buy a car sight unseen.”

People want safety, great gas mileage and technology, according to Tindol.

These days fewer dealerships are family-owned. That is an important distinction for Tindol: “Being family owned means you can make decisions from the floor and employees are empowered to help people. We don’t have to wait for corporate to tell us what to do.”

Tindol believes that working side by side with her father, the way he guided her through the dealership, has had a big impact on her success. “Although I am confident in my abilities, without his tutelage and the opportunities he afforded me, I wouldn’t be the businesswoman I am today. He is a great person and a great businessman. He taught me how to take the high road.”

Though keenly aware of her responsibility, Tindol credits her employees for the continued success of the dealership. “They are the ones on the front line taking care of folks and representing me and our dealership.  They deserve the accolades for making good things happen.” Tindol smiles.

“I am proud to be part of a company that provides transportation needs, which is such an integral part of what America is.”

“We (car dealers] employ a lot of people across the nation and world. I am proud to be a part of that,” says Tindol.

When a major logistics company wanted to provide information on fuel costs, weather and specialized route information to their drivers on the road, they needed a way to deliver that data to hundreds of trucks all over the country.

When AAA Carolinas wanted to learn more about what services their customers used and how to make better customer-focused decisions, they needed to pull data from multiple disparate systems to create actionable customer information.

And when a manufacturing company wanted to understand the profitability of different SKUs, customers and regions, they needed to bring together data from financial accounting systems, inventory management systems, and sales management systems.

All three of these companies turned to Intellinet Corporation, an Atlanta-based management consulting and Microsoft-centric technology services firm. Founded by Frank Bell in 1993 as a boutique technology services company, today Intellinet is a broad-based management consulting and business technology services firm consulting on IT strategies, processes, and the complete stack of Microsoft enterprise-level products.

While the corporate offices are in Atlanta, Intellinet operates regional offices in Charlotte and Durham, and the Carolinas market is playing an important role in the company’s growth strategy.

 

Carolinas Key to Growth

Bell still serves as Intellinet’s chairman, but Mark Seeley, president and senior partner, now oversees the day-to-day operations. Seeley joined Intellinet in 1996 after working as a senior management and process consultant at Andersen Consulting. In his over 20-year career, he has founded or co-founded five different companies in a variety of industries including software, e-commerce, logistics, and real estate.

Intellinet entered the Charlotte market in 2003, and because of the Carolinas market’s rapid growth, the company decided to further focus business development efforts by brining in Glenn Williams as regional vice president in 2007 to run the Carolinas practice. Prior to joining Intellinet, Williams served as the vice president of sales and co-owner of Infovision, a Charlotte-based Microsoft Business Solutions partner.

Then, about two and a half years ago, Intellinet reorganized to focus on its clients’ business strategy and process needs, linking business strategy to technology solutions.

“That is how our strategy and process practices came into being,” says Seeley. “It has worked out great as our strategy practice is made up of seasoned IT professionals who understand strategy and the implementation disciplines needed to execute that strategy.”

Although Intellinet has over 900 customers in 42 states and eight countries, they remain a Southeast-focused company. In the Carolinas market, Williams focuses on Charlotte and South Carolina, while his sales representative in Chapel Hill handles the Triangle area and works together with him to cover the Triad. Intellinet customers range from Fortune 500 corporations to venture capital-backed start-ups.

“Although we have customers of all sizes, I would say our sweet spot is what Microsoft calls their Corporate Account Managed space, which is typically about 800 to 5,000 employees,” says Williams. “While we cover all industry verticals in the Carolinas, I would say our leading vertical in the region is manufacturing/distribution.”

“Of the just over 5,000 projects we’ve done since our inception, our biggest category by numbers is professional services,” adds Seeley. “Beyond that, it would be manufacturing/supply chain, healthcare, and financial services.”

Intellinet divides their business into two main categories: management consulting and technology services.

 

Management Consulting

Intellinet’s consulting practice evolved from their belief that a company’s business strategy should drive technology decisions. The firm helps clients define their IT strategy, optimizes business processes with change management and project management techniques, and provides assistance with business solutions that allow companies to better align their technology with their business objectives.

“Our strategy practice will give a CIO a three to five year technology road map,” says Seeley. “What technologies should they use for data analytics? Should they look at the cloud or consider localized or geo-distributed data centers? How are they managing and evolving their core applications or dealing with mobile? How are IT funds allocated and managed across the organization through a PMO or other project management functions? It’s really a services strategy that goes across people, process, and technology.”

Once the IT strategy is defined and a road map is created, Intellinet also can help their clients implement the proposed changes. They help clients with effective project and program management methodologies, addressing organizational and process issues that can result in projects being late, over budget, or never adopted. The firm’s project managers and business process leads average 15 to 20 years of technology and project management experience.

The third pillar of Intellinet’s management consulting practice focuses on helping IT leaders align and implement effective solutions to become a best-in-class IT provider to the business. These solutions address portfolio management, budgeting and planning, organizational effectiveness, and innovation.

While management consulting solutions may include many of the Microsoft products the firm offers through their technology services, Seeley is careful to point out a key difference between the firm’s consulting and technology practices.

“While all of our technology services are centered on Microsoft, our management consulting is at its core technology agnostic,” explains Seeley. “On the strategy side, our clients work with Microsoft, Oracle, SAP, and Siebel, for example. We provide strategy, process, and implementation guidance across all technologies. But on the delivery side, when you get down to implementation and ongoing maintenance and enhancements, that is where we really focus on the Microsoft stack.”

 

Technology Services

According to Seeley, most of the 640,000 Microsoft partner firms focus only on one or two components of the Microsoft product portfolio. By contrast, Intellinet is one of a much smaller subset of technology services firms that can implement the entire Microsoft product stack, allowing them to solve customer issues in five different technology practice areas—portals and collaboration, business intelligence, application development, cloud and mobility, and infrastructure.

Portals and collaboration solutions connect the people and processes of a company’s business environment to information. One solution might be an intranet, an internal company website that provides employees with access to the information they need to do their jobs. This might include documents for knowledge sharing, collaboration space, customer information, financial information, and much more.

Another solution might be an extranet, which allows the customers of a client company to access secure information about their mutual business relationships. The answer to a business problem might also be an Internet site, allowing the general public access to information the company wants to share.

Closely connected to portals and collaboration is business intelligence—solutions which allow a company to collect data from a variety of disparate systems and convert that data into actionable knowledge. Business intelligence is the back-end applications that collect data from the client company’s operating systems, while portals are the front-end applications that allow employees, customers, or the public access to this information.

Intellinet uses Microsoft tools such as SQL Server to bring the business intelligence data together, and SharePoint to create the portals that allow the information to be shared, analyzed, and delivered as dashboards with actionable knowledge.

“Clients have many disparate systems and none of them talk to each other,” explains Williams. “They might have data in a financial reporting system and other data in a customer relationship database. So what business intelligence allows us to do is to take data from those disparate systems and create a data warehouse so that specific data from each system goes into one place where it can be cleansed, validated and accessed.”

“The two most tightly related parts of our technology practice are portals and business intelligence,” he continues. “While they are two separate practices within Intellinet, about 50 percent of our customers who use us for portal solutions will also use us for business intelligence because they are so tightly integrated.”

The third technology focus, application development, builds custom software applications for clients with specialized needs where off-the-shelf Microsoft software is not appropriate. These projects could involve special configuration of out-of-the-box software or complete custom development projects.

The fourth area is cloud and mobility. Intellinet works with clients interested in evaluating or moving to the cloud to determine a cloud strategy, prepare for moving to the cloud, and performing migrations. Intellinet has a specific cloud practice that is one of the largest in the Southeast focusing on migrating corporations’ email, portals, data, and communications to the cloud via Microsoft Office365, Microsoft InTune, and Microsoft Azure.

For companies looking to take advantage of mobile technologies, Intellinet helps their clients develop strategies for managing, creating and securing mobile applications, as well as developing custom mobile applications that support a variety of different devices from smart phones, to tablets, to the desktop.

The final technology area is the IT infrastructure practice which focuses on core foundational enterprise network infrastructure systems operating in on-premise data centers as well as in the cloud. Intellinet works with these clients to create an infrastructure strategy and associated solutions that maximize availability and minimize vulnerabilities, and provide effective ways to manage network systems.

 

A People Business

The foundation of any service business is the people. Unlike many of the Big Four consulting firms which often employ droves of very bright, but inexperienced recent graduates, Intellinet focuses on hiring seasoned IT professionals. Their management consulting practice features a number of former CIOs and many associates with previous Big Four experience. The consulting practice averages over 20 years of experience and the average experience across the technology practice is about 16 to 18 years. But even though Intellinet feels their people are among their most important competitive advantages, finding the right people is one of the biggest challenges they face.

“Candidly, one of our biggest challenges is finding technology architects and growing the technology architects within our own ranks to be able to lead our customers along this new paradigm of cloud-based services, mobile development, and all of the new products that are out there,” admits Seeley. “The marketplace has really taken off in the Carolinas and the rest of the Southeast, so we’re hiring around project disciplines, strategy disciplines, and technology disciplines.”

To help attract the best and the brightest, Intellinet has built a culture based around seven core values—people, optimism, balance, wisdom, integrity, service, and humility. These seven values drive the way the company delivers value to their clients and create a great place to work for their associates.

“My goal as chief executive is building a firm where people would say, whether they were here for two, 10, or 20 years, that Intellinet was the best place they ever worked,” says Seeley. “We balance the idea of family life and professional life. We look for continuing professional education opportunities for all of our team. And we truly care for our employees overall health and well-being through a lot of fun family events, quarterly 5K runs, health club memberships, and the like.”

The company has also set up the Intellinet Foundation as a way to further give back a material amount of their profits to the communities they serve. Company employees get a chance to choose the non-profits which Intellinet supports through time and donations throughout each year and during the holidays, Intellinet’s clients select between three charities to which Intellinet will make financial donations on their behalf.

“When Frank Bell founded the company, his vision was not just to build yet another services company, but to have one that truly stood for something,” explains Seeley. “He set out a vision where our word is our bond. We see that delivering on our promises is really our most compelling advantage in the marketplace for a services business that is built around people.”

“On the back of our business cards is our motto, ‘Promises kept,’” concludes Glenn Williams. “I bet a majority of our employees would say that’s one of the main reasons they came to work for Intellinet. Beyond us being a great strategy and technology company, we strive to do what we say, and at the end of the day, that’s what’s most important. After all, we’re in the people business.”

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.

BizXperts

The objective of tax planning is to minimize one’s tax liability. Early planning can aid tax avoidance by paying only what one is required to pay and nothing more. One of the most widely used tools in planning is deferral of revenue and acceleration of expenses.

Generally, tax planning is performed towards the end of the year when there is more predictability of what the year’s end results will be. The year 2012 may be a crucial year in which to conduct planning for future years due to the possibility of tax rate hikes and the expiration of various deductions and credits.

 

Consider the impact of the following changes:

  • Expiration of Bush-era tax cuts, resulting in higher tax rates for most individual taxpayers (between 3 to 5 percent)
  • Higher tax rates on long-term capital gains (between 5 to 15 percent)
  • Expiration of the payroll tax holiday on wages and self-employment income (increase in tax on qualifying income of 2 percent)
  • New Medicare tax on higher-income employee wages and self-employment income (additional 0.9 percent)
  • New surtax on investment income of higher-income taxpayers (3.8 percent)
  • Application of estate and gift taxes to more taxpayers (estate and gift exemption drops from $5 million to $1 million) and at higher tax rates (increases from 35 to 55 percent)
  • Severe cutbacks in the amount of business equipment that can be expensed in a year

 

The lame duck Congress goes back into session mid-month and tax matters are but one important issue it is under pressure to address before adjourning. It is unknown what Congress and the President will come to agree on and pass, if anything.

 

Tax Planning for Business

 

Timing of expense payments and income recognition

When a business operates on the cash basis, expenses and revenues are usually recognized for tax purposes when cash is paid or received versus when expenses are incurred or revenue is earned (accrual basis). A cash basis taxpayer has some additional control over its taxable income through the timing of when it pays bills or collects for its services.

Usually a cash basis taxpayer will try to decrease current year income. However, if individual tax rates increase next year, the opposite would hold true, as pass-through entities could save tax by accelerating income to be taxed at more favorable 2013 rates. Note that pass-through entities do not pay tax at the corporate level as net income is passed through to the individual members and taxed at their respective individual rates. As of now, if Congress is able to act at all, it may extend current tax rates for some or all taxpayers, but a decrease in rates for 2013 is highly unlikely.

 

Make contributions to a qualifying retirement plan

Qualifying business retirement plans have higher contribution limits than IRAs. Through contributing to traditional qualifying plans, business owners and employees can defer more income tax and have larger amounts grow tax-free until withdrawn.

 

Accelerated depreciation for equipment purchases

Taxpayer-friendly rules governing accelerated rates of depreciation are scheduled to decrease significantly after this year. For 2012, Section 179 expensing is available for up to $139,000 for new and used items placed in service during 2012. This expense may not be available to businesses with a current year loss and begins to phase out when total additions exceed $560,000.

In situations where Section 179 expensing is limited, one may qualify for Section 168 50 percent bonus first year depreciation for assets bought new and placed in service during 2012. Unlike the Section 179 deduction, there are no restrictions on the amount of qualifying property nor is there a taxable income limitation. However, bonus depreciation rules only apply to the purchase of new equipment, not used. Unless Congress acts to extend the bonus depreciation, it will not be available for 2013 and Section 179 expense will be scaled back to $25,000 and become limited when total additions exceed $200,000.

 

Tax Planning for Individuals

 

Individual taxpayers should be aware that most of the scheduled tax changes apply to them.

 

Plan for changes in tax rates

The expected tax rate increase on ordinary income and capital gains encourage recognition of income in 2012 and deferral of deductions to 2013. The maximum capital gains tax rate is scheduled to increase from 15 percent to 20 percent.

 

Make taxable gifts in 2012

Currently in place is a $13,000 annual exemption on gifts one can make to reduce one’s taxable estate without triggering a tax filing requirement. In 2012, there is a unique opportunity to move investments, real estate, or business holdings to the next generation tax-free. For this year only, you may make gifts of up to $5,120,000 in excess of the annual exemption without incurring gift tax. That amount, as well as the estate tax exemption, is scheduled to decrease to $1,000,000 in 2013.

As with most things tax-related, even exceptions to the rules have exceptions. It is very important to consult your qualified tax professional to see if any of these tax saving strategies apply to your own unique tax situation.

Projects often appear to be the lifeblood of a company. In contrast to daily operations, projects are defined by having a beginning, an ending and a goal to achieve a change in some organizational aspect. Project Management is the structured discipline applied to support organizations in managing these projects from beginning to end.

Change, on the other hand, is often the new behavior or performance an organization desires to reach through the project. Change Management is the application of a structured process and tools to lead the people side of change and increase the probability of project success.

So, if projects create change to reach goals, why are Project Management and Change Management professionals often at odds? Project Managers often contend, “I don’t need those warm and fuzzy change people messing up my project,” while the sponsors and finance people often believe the project manager should handle the change—after all the Project Manager is tasked with successfully managing the project. In some cases change managers may be assigned to manage the technical change through Change Control Boards or ITIL Service Management. While there is change management involved in that process, it is technical and project change, not the people side of change.

In reality, Project Managers and Change Managers need each other: It is the integration of Project Management and Change Management which delivers the most successful projects.

How successful? According to global Change Management benchmarking research conducted bi-annually by Prosci, projects which utilize Change Management strategies and activities are six times more successful in reaching the targeted project goals than projects which do not include Change Management. Six times? Is Change Management really that important?

Consider this scenario: In a recent program undertaken by a major energy organization, more than 80 issues were identified as impacting the ultimate adoption of a new technology and business processes within the organization. Of the 80 issues, at least one issue created a $500,000 (and growing) problem—primarily due to increased equipment costs of replacing equipment erroneously removed by employees and the labor costs of utilizing contractors to re-install the equipment.

In review, the root cause was the people (operations) did not understand the changes the first time and dependent processes increased the volume of the problem. The project was technically on time and in scope—but the people were not cooperating!

Ultimately a Change Management effort was developed, root causes were identified, a change strategy was deployed and, in less than three months, incorrect installations were reduced by more than 80 percent.

The result was real money being saved—this project is anticipated to bring benefits of more than $200 million to the organization. What is the impact of having a major portion of that program off track? In the end, is it worth it to pro-actively invest in Change Management to eliminate the issue and reach the benefits?

Now, Change Management is not magic. It works best as part of an integrated approach with an active and visible sponsor (or sponsors), properly defined scope and charters, and governance. And ultimately the Project Manager does generally have the responsibility to bring the project in on time, on budget, in scope and with quality. That job is made easier by integrating Change Management tools and processes within the project.

Another consideration is the ultimate sustainability of a change. Delivering the change is hard enough—the real challenge is often sustaining that change within the organization. It’s the “stickiness” or adoption that is the ultimate measurement of a project success—the delivery and achievement of the ultimate benefit.

Now suppose the project is to deliver a new integrated SAP or ERP program—big, expensive programs which generally impact most if not all business units. If an organization is targeting saving $20 million annually, the integration of effective Change Management within the project helps organizations reach that targeted benefit 95 percent of the time.

This is the most compelling reason to insist Project Managers and Change Managers work together on a project to develop an integrated approach—we need the people to help us design, develop, test and execute the change. By considering the stakeholders (the people) upfront, we are more likely to reach and sustain our project goals including those important financial benefits.

As business managers, and project sponsors, the real question should be: How can we not afford to integrate Change Management into our Project Management approach?

If you are a business owner experiencing marital difficulties, you should seek advice from an experienced family lawyer knowledgeable of the methods for protecting you, your business and your family from potential damage caused by separation and divorce. Here are some issues to consider with your lawyer as you work through separation or divorce.

 

The Business as “Marital Property.” Property accumulated during a marriage is subject to division during separation or divorce. A business may be considered such property. The business is typically the most difficult asset to value in marital property distribution, and often the source of a substantial part, or even all of the family income.

Distributing the value of the business between spouses may be difficult, particularly when the goal is to not damage or destroy the business. Often, the capital needs of the business compete with the needs of the family, as well as the ability of a spouse to transfer to the other spouse a fair share of the property value. Structuring such distributions are a critical aspect of separation and divorce planning.

 

Spouses as Business Partners. It is difficult enough to run a business with one or more partners. If you and your business partner barely speak, or your business partner wants you out of their life, the effects can be disastrous. How do such partners communicate? How are decisions made? Are the partners equal decision-makers? What do the ownership documents say? What if there are no ownership documents? Is there a way to turn over decision-making ability to a neutral? What if one spouse intentionally harms the business? What if your spouse starts a business as your competitor?

 

Paying Alimony and/or Child Support and Managing Cash Flow. Business owners often determine the amount and frequency of their own compensation. This is a business decision that may literally affect the viability of the company. The amount of compensation is often an issue in deciding the amount of spousal or child support and how it is structured.

How support is paid, as well as the amount, can have an obvious affect on business cash flow. Can the business owner sustain the payments over a long period? What happens in difficult economic times; how does support get paid or restructured? What if the compensation cannot be paid as in the past; how does this affect support?

 

Sharing Kids and Running a Business. Running a business is demanding. It can be difficult to manage work and time with the children. How does this affect a business owner’s rights to his or her children? What if the owner works particularly long or odd hours, or must travel frequently? How are children shared and exchanged?

 

Litigation and Lost Work Days. Days spent in court on separation, divorce, or custody issues are days not spent working. They are not productive days. This can be particularly difficult for the sole proprietor or one with a professional practice, for example doctors or dentists. Court schedules are subject to frequent modification, and the amount of time in court is usually unpredictable.

 

Delayed Ability to Retire. Often the business owner’s largest financial asset is his or her business and retirement accounts. When value is pulled from the business or retirement accounts to satisfy a division of the marital estate, the business owner may face a sharp reduction in lifestyle choices and inability to retire at the age anticipated. This in turn can affect the owner’s succession planning, making such planning even more critical.

 

Workplace Disruption. One of the most distressing problems a business owner may face is when contentious marital issues spill into the workplace itself. An angry spouse suddenly appearing at work to discuss or argue personal issues, or repeatedly calling co-workers, employees, customers, or others, can wreak havoc.

Employees are often used to seeing a spouse enter a workplace, and so may not be prepared to handle such problems when they arise. Vindictive spouses have been known to sabotage business dealings, steal from the workplace, or drive customers away.

 

Although issues facing a separating or divorcing business owner may have potential to endanger his or her business, it is important to remember that with proper planning and guidance such issues are manageable, or even avoidable. They need not threaten the survival of the business. It is important to seek advice from a qualified professional to protect you, your business and your family.

Publisher's Posts

Americans are among the most discriminating and demanding consumers. We know how and where to shop for what we want and what we’re willing to pay. We buy food, clothing, shelter, vacations, cars, jewelry, plastic surgery, technology, you name it. We buy in retail stores, in wholesale clubs, and online by computer or tablet or smartphone. We know how to find discount codes, obtain shipping for free, and even avoid paying sales taxes for nearly every purchase we make…that is, except health care!

And I do mean health care. I am not talking about health insurance. I am talking about the services of doctor or other health professionals, services in hospitals or clinics or offices, testing and laboratory work, drugs and treatments, as well as extended care. Rarely, if ever, do we even know prices—let alone compare prices—for health care as long as we have had health insurance.

When a doctor recommends lab work, a test, an x-ray, a CAT scan, or an MRI, we simply go where the doctor tells us to go and have the work done. It is only the increasing imposition by insurers of co-insurance and higher deductibles that has caused us to even ask if they are really necessary, but we will usually go and do it anyway.

And if you are bold enough to ask about the cost? Well, good luck with that! In most cases, no one from the doctor on down seems to know the cost of anything beyond the consultation fee. They just provide the services themselves.

Billing—the business side of health care—has the expertise in knowing how best to characterize the charges for services performed to obtain the maximum reimbursement from any given insurer, as well as the co-pay and deductible information to obtain payment from the individual, thereby maximizing the revenue stream for the health care provider. Yes, different rates may be applied to different insurance companies. It is incredibly complex.

In this issue of Greater Charlotte Biz, we have focused on BIG DATA and BIG INSIGHTS. With the continuing expansion and application of information technology, we want you to learn about the impact of this information being collected and how to use it to your advantage.

When purchasers of health care and payers of health care come together with their BIG data, they can begin to analyze the care, compare costs and quality to enable us to make better health care decisions. Large employers and large insurers are well-positioned to demand and analyze this information on behalf of their insureds. Individuals and small businesses are likely to gain this opportunity through the health insurance exchanges as they grow and develop. This data aggregation will support better and more cost-saving choices.

Of note in this regard, is a company named Castlight Health, founded in 2008 to “enable employers and health plans to lower the cost of health care and provide individuals unbiased pricing and quality information to make smart health care purchase decisions. Named #1 on The Wall Street Journal list of “The Top 50 Venture-Backed Companies” for 2011, Castlight is building a search engine for health care prices, quality and coverage for large companies.

Others providing health care cost comparisons include: New Choice Health, Healthcare Blue Book, ClearCost Health, OutOfPocket.com, Change Healthcare, Aetna, Blue Cross Blue Shield, United Health, and Hospital Compare (HHS/Medicare).

Imagine knowing in advance the range of costs for particular procedures. Imagine being able to compare doctors, find their locations, learn about their charges, and review their outcomes and satisfaction ratings. Imagine being able to do the same for hospitals. This information only becomes available and valuable when the inputs from hundreds and even thousands of discharge records are collected. Think how Big Data can positively impact your health care choices and your life!

Moreover, consider how such data accumulation can lead to Big Insights impacting your health care and your life. The individual health experiences and records of thousands of others will be available for comparison to symptoms and courses of treatment, aiding in more accurate diagnoses and more appropriate health care options.

Price transparency can significantly change the way health care is purchased in the United States. The lack of price information in health care has been a big driver of skyrocketing health care costs. Most patients never see the charges, employers are busy paying for coverage, and insurers are batted around by providers. As long as patients pay for health care with someone else’s credit card, they will ignore costs and seek all the care they can get.

What is important is to seek quality care at reasonable prices. Lining up the incentives in the right direction will go a long ways to reduce costs and improve care in very BIG ways. We have BIG steps to take in managing our health care costs.

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Thank you, John Paul Galles