What follows is an interview I did with Carl Schell, Senior Editor at KeyPoint Intelligence, about Thermocopy’s environmental sustainability efforts. In the interview I talk about how environmental sustainability initiatives make bottom-line business sense and how Thermocopy assists their client’s internal initiatives. Many thanks to Carl for giving us the chance to communicate these efforts. This is the link to the interview if you would like to go to the source article:
http://tinyurl.com/l5ab97x
Caring for the Environment Is Second Nature to Thermocopy
A Q&A with Company Executive Mark DeNicola
Saving customers’ time and money is the name of the game for dealers, but for Thermocopy it’s also very much about saving the Earth. Since 1964, the company has been a leading technology provider in the mostly mountainous region of East Tennessee. And for the past decade, it has made eco responsibility a key plank in its all-encompassing strategy, one that is centered on the office but also includes production and managed IT, to name two other areas of focus. As such, to celebrate Earth Day 2017, we spoke with Mark DeNicola, Thermocopy’s CFO and Executive Director of Sales and Marketing, to discuss the company’s commitment to environmental sustainability.
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| Mark DeNicola, Thermocopy’s CFO and Executive Director of Sales and Marketing |
Carl Schell: What is the “state of the state†of Thermocopy?
Mark DeNicola: We are in the best place we have ever been in our over 50-year history. Our 2016 revenue was approximately $14 million, we have been delivering the best customer service in our market as evidenced by our Net Promoter Score of 96+, and our service response times are the lowest they have ever been. We have the processes and resources in place to embark on our retooled 5-year plan and, most importantly, are living up to our core values: One Team, with Integrity, driven by Excellence, creating Raving Fans.
CS: The “green†message is obviously important to your company, as there are not one but two pages on your site dedicated to it. When did Thermocopy make environmental friendliness a part of its strategy, and how did it all come about?
MD: Our stance on the environment really grew out of our nomination in 2007 for a Pinnacle Award, which recognizes excellence in the East Tennessee business community. The submission process required us to provide a lot of background information and review our mission statement, which is when we realized that we were meeting all of our commitments except for one: the environment.
When we crafted our mission statement in 1995, we said we would be an eco-responsible business partner. This meant, for example, that we would dispose of toner in a proper fashion. A decade later, we understood that more could be done and we wanted to make that happen. So, we asked for volunteers to form a committee to look into our business processes and recommend ways to improve our environmental efforts. Our Greenworks program is the result of all that hard work, and it covers everything from document management to recycling, using recycled media to the reduction of electric, water and gas usage, as well as bio-fuel use for company vehicles, “green†cleaning products, and community support and education.
We supply recycling containers for paper under every office worker’s desk, along with providing bins in common areas for glass, aluminum, paper and plastic. In fact, we encourage employees to utilize our containers for their recyclable items from home. I am a believer in the wise saying “If you can’t measure it, you can’t manage it,†so an important element in the program is our tracking site, where employees and the public can view the results of our efforts. Included here is an extrapolation of what the environmental benefits would be if 50 percent of the businesses our size would implement the same type of program and experience the same type of results.
To reach the community in general, we founded GoGreenET.com, a free, online resource created to guide East Tennessee businesses and other organizations towards being more environmentally responsible. The site provides basic information about products and services that can help organizations go “green.†The goal is improvement, not perfection. GoGreenET.com also encourages businesses to look for ways that go beyond the basic first steps presented on the site.
CS: Has this message resonated with your customers? Did it take some time for them to really buy into what you were saying?
MD: At first it was a difficult sell, but some verticals, like education and government, did embrace the message right away. For many companies, the message had to be prefaced by the inherent cost savings that come along with sustainability. Now, to assist with the adoption of “green†practices, we provide an Environmental Impact Assessment as part of our Printworks+ program. Through this process, we guide our clients to move towards more environmentally friendly printing practices, such as default duplexing on office equipment and the use of toner-centric printers, all while lowering costs associated with printing. Of course, as more companies have included sustainability in their respective mission statement, embracing the message has become more prevalent. The true message is that sustainability makes bottom-line business sense and is just the right thing to do.
CS: Environmental sustainability has of course been a bigger deal in other parts of the world, namely Europe. Why do you think this is?
MD: I believe it is a combination of things. Europe and Japan, which were considered the early adopters and the leaders in the movement, went through wars that devastated their economies and their land, which is a situation that has never occurred here. They were forced into a more conservative approach to material waste. Thus, the conservation movement was born—not of altruism, but out of necessity. Today, it is a way of life for them and, of course, the right thing to do as the world population increases.
CS: Beyond traditional things like automatic duplexing and toner-save mode, what features and tools do you encourage customers to take advantage of?
MD: Well, the MFPs we sell are the onboarding process for converting paper to digital files. Our Printworks+ program includes information flow analysis, which advances the idea of the “less paper†office. Through Centriworks, our solutions company, we have the print tracking programs and the document management and storage systems that can make that happen for businesses. We have the capability of implementing these solutions and providing the ongoing training and future touchpoints necessary to ensure the systems are installed are effectively utilized by the business. We do not just install and walk away!
CS: How much do your sales reps address eco responsibility in the sales cycle?
MD: The subject is broached upon the introduction of Thermocopy to a business. We have business cards advertising GoGreenET.com that are handed out with traditional business cards. We offer to help them apply for the Green Achievers certification that gets them listed on that site. It is an integral part of the Image Output Analysis that provides the Environmental Impact Assessment. So, eco responsibility is addressed throughout the process, from beginning to end.
CS: Your company has been recognized in various ways for your “green†efforts. Do you feel like these awards and otherwise have made an impact?
MD: We have won several awards for our efforts, including a Keep Knoxville Beautiful Environmental Achievement Award and the Governor’s Environmental Achievement Award for excellence in public education. Our efforts have certainly been a differentiator. In basic dollars and cents terms, the recognition has provided thousands of dollars in free advertising and has enabled us to win business that we might not otherwise have. But, as Henry Ford once said, “A business that makes nothing but money is a poor kind of business.†We are believers in corporate responsibility. We are proud of the respect that we receive in our community and our efforts to positively impact the community both now and for future generations.
CS: Is there one business you’ve worked with that really embraced the eco angle? What kind of results did it wind up with?
MD: Tindell’s comes to mind. Tindell’s Building Materials began in 1907 as a sawmill business. They now own and operate building materials sales and warehousing facilities throughout East Tennessee. They saw the market moving slowly toward a more eco-friendly building model. Because of that, several of the company’s employees obtained LEED certifications. The company also became FSC certified in an effort to lead its industry in environmental initiatives. However, making a conscious effort to seek out and market environmentally responsible products didn’t stop with building materials—Tindell viewed its efforts as a company-wide commitment that included “green†back-office solutions.
The challenge was every Tindell’s location had multiple copiers, printers, and fax machines, and as a fiscally conscious company, it should go without saying that cost was a consideration when Tindell’s started looking at ways to improve office efficiency. The company was leaning toward the purchase of a competitive product instead of staying with us, attracted by the fact that the brand they were looking at was so inexpensive. We met with management to discuss Thermocopy’s commitment to environmental initiatives, including our Greenworks program, and the negative impact that going with a product that might be less expensive—but also less environmentally friendly—would have on business goals.
We replaced old equipment with one MFP in each of Tindell’s four locations so all printing, scanning, copying, and faxing could be done from the same source—one machine means just one plug, which helps reduce energy consumption. The whole exercise of streamlining Tindell’s processes is having success as well. Instead of receiving a plethora of invoices every day in the mail and dealing with file cabinets, the company gets electronic invoices and processes them using technology. Today, they rarely touch a piece of paper.
CS: What’s your advice for other dealers that aren’t as dialed in to the environment as your company is?
MD: I believe that our industry should be the ambassadors for environmental sustainability initiatives. We have received black eyes over the years for our contribution to the problem due to the huge carbon footprint from the printing process. As good corporate citizens, it is our responsibility to educate our clients on how to reduce their carbon footprint and the resulting cost decreases that occur because of their efforts. I do not know why dealers wouldn’t dial in to this critical effort.
CS: In closing, is there anything you’d like to say that we haven’t covered?
MD: Other than saying I don’t know why a company would purchase office equipment or digital solutions from any company other than Thermocopy? Sorry, just had to say that.
We have covered a lot of ground in this interview. I would like to emphasize again our commitment to educating the community about the best practices pertaining to eco sustainability. Thanks so much for the opportunity to tell our story.
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| Thermocopy is headquartered in the heart of Volunteer country in Knoxville, Tennessee, with another location in Johnson City. |
in the tournament, with Thermocopy Team 2 netting a 1st place on course B and service technician extraordinaire, Johnathan Tilley, taking 3rd place individual honors. Throughout the tournament, WBIR’s Russell Biven spent the day visiting with participants and partaking in the day’s activities. Jane Haney, Thermocopy major account representative, volunteered to help make the event a success. Fun was had by all!
Article Published in enx magazine: Budgeting and Forecasting – What It Is and Why Do It!
Last year, as part of a financial forum, I sat on a panel to discuss budgeting and forecasting methods with a room full of head financial managers of their businesses. I was surprised at the number of businesses that do not have a formal process in place to do an annual budget. In fact, there was a high amount of resistance to developing a budget.
Some of the reasons given were as follows:
Having a Fortune 500 background early in my career, I was indoctrinated with the belief that a formal budgeting process and forecasting were vital to the company’s financial and operating health. In fact, in public companies it is a requirement, because of that important quarterly and annual Earnings Per Share projection. A budget enables the CEO to tell the analysts and stockholders why they hit the projection or not and then forecast future earnings based on revised conditions. Shouldn’t the owner of a private business also have this ability?
Let’s define what a budget is and why every company should develop one that includes both revenue and expenses. My definition of a budget is as follows:
It is the formal business plan that is developed using historical information and adjusted for the future business environment. It is the operational and financial outcome of the plans/goals that you have set for the next year. The budget is typically finalized in the months before a company’s new fiscal year starts. If possible, it should include all P&L items and, on separate schedules, any required capital expenditures. A company budgets annually and reviews periodically (preferable monthly).
There are many reasons to create a budget.
Among them are:
It is not difficult to create a budget. It can be as simple or detailed as you like. Of course, the more detail, the longer the budget takes to complete. The two key components of any P&L budget are revenue and expenses.
Revenue
I would guess every company in our industry creates, at the very least, an equipment revenue budget as the result of the assigned quotas for the sales representatives. Some other components of the revenue budget would be service/supply income, leasing/rental income, solutions income, etcetera.
Expenses – Fixed and Variable
Fixed expenses are often referred to as overhead items and would include things like utilities, rent, and general and administrative expenses. These are all consistent from month to month, regardless of the revenue volume.
Marketing/advertising expenses can also be considered fixed if the company has identified an amount they want to spend for the budgeted period. These expenses can be budgeted evenly through the period, or, if there are known large expenditures in certain periods (for instance, if it is known that half of the advertising budget will be spent in the first quarter), I would budget those items when they are expected to occur for cash flow purposes.
Variable expenses fluctuate from month to month as the result of revenue volume changes. For example, the costs associated with equipment sales fluctuate in direct proportion to the amount of equipment sold. Other variable expenses would be parts and supply costs, etc.
After the P&L budget is completed, you should be able to identify the cash provided from operations for each month. This will help with planning any anticipated capital expenditures and the financing required (if any). The capital expenditure budget should be on a separate schedule and budgeted for the month in which the capital expenditure is required.
At Thermocopy we use the budget for comparisons to actual as part of our monthly management meeting. We have identified the key performance metrics that determine the health of the company and review them monthly. Each manager is expected to explain why there are variances, both favorable and unfavorable, from the budgeted number. If the variance is unfavorable, what plan is being implemented to bring the number in line with the budget.
These items are all discussed in a very non-threatening manner, and the more a company does this, the less threatening the review becomes. The review is a great communications tool and helps the managers understand the challenges in other departments. It provides a forum to bring all hands on-deck to help solve problems and to celebrate victories. Forecasting is also part of this meeting.
A forecast is the expectation of what is happening in your business for the rest of the budgeted period. It should be prepared monthly or quarterly and is a combination of the actual results to that point and the future expectations. I mentioned before that each manager in our monthly managers’ meeting is expected to present the plan for the rest of the year. Things change, that is a given. It would be like wearing blinders if you did not revise the budget numbers in a changing environment, and the forecast allows you do exactly that.
Here is a real-life example of using a forecast to deal with an unexpected change. The end of one of our major account contracts ($2,000,000 of equipment revenue) was set to end on August 31, 2016. I had budgeted the implementation period to be June through August if we were awarded the contract again. We were awarded the contract in July, but the company required an extension of the old contract to the end of the year. Wearing blinders would have been using the original budget numbers for the rest of the year and not recognizing that $2,000,000 and all the resulting cash flow was not going to occur. Fortunately, we had a contract in hand and the lease revenue for the additional months. The changes were all considered in the forecast. As the result of the reviews in the managers’ meetings, all departments knew what operational resources were not required until the end of the year and how the revenue and cash forecasts were changed.
In conclusion, I believe that a budget should be developed for every business, no matter how large or small. There really is no excuse not to have a full P&L budget of some sort. Used correctly, it can lead to higher profits, provide a framework for financial decisions, and ensure that all teams are working toward the same goal.