Thursday, December 24, 2009

Year in Review

Can't let a year, much less a decade, go by without a list.

Posted By on Thu, Dec 24, 2009 at 4:00 AM

It was a good year for doing more with less.

Think yoga, sliders, 401(k) accounts, blogs, the airlines, Starbucks, and interim mayors. Also Snuggies, Crocs, and 64-calorie beer, for which there will be special corners in hell.

Think "Hitler's Take on LSU" on YouTube, Lil Rounds and Alexis Grace on American Idol, Ole Miss running back Dexter McCluster (5'9" and 170 pounds) running wild against Tennessee, and the Grizzlies minus Allen Iverson.

Think advertising. Big corporations and the creative teams at their agencies spend hundreds of thousands of dollars on ads for the Super Bowl every year. The Doritos "crystal ball" ad, chosen as one of the best of the lot, created by a pair of thirtysomething brothers, cost just under $2,000.

Think books and movies. Elmore Leonard advises would-be authors to leave out the parts readers skip. Cormac McCarthy, former East Tennesseean, used to write long books like Suttree and All the Pretty Horses with long sentences and paragraphs. His last two novels, No Country for Old Men and The Road, are short books with short sentences and utterances that are barely sentences at all. Both have been made into major movies.

There were also those who managed to do less with more.

Think big banks, the stimulus, Oprah, Tiger Woods, John "0 for 2008" Calipari, one and done, the movie adaptation of Where the Wild Things Are, Congress and health care, Willie Herenton, Michael Jackson, another season of 24, Yahoo, and Tommy West's upcoming prepaid retirement.

Overton Square has some popular restaurants and a nice movie theater and lots of passionate supporters but can't get its act together. Where were the satirical publication The Onion and Christian Lander and his blog "Stuff White People Like" when city councilman Shea Flinn convened a hearing on what to do about the square?

As the Onionists might have written it, the largest ethnic minority group in Memphis, wearing colorful ethnic designer coats and seasonal footwear from Patagonia and L.L. Bean, rallied at City Hall to demand that attention be paid to the need for an ethnic market such Trader Joe's with exotic herbs and wines as well as boutique shoppes in historically significant buildings and parking areas restricted to Subaru Outbacks, bicycles, and skateboards.

Riverfront development and Beale Street Landing stalled as prices went up. The debate between pro-development types and preservationists is well and good, but holding future faceoffs in, say, the Raleigh Springs Mall or Fox Meadows might shed a different light on things.

And some are doing more with more. Gadflys, comedians, and commenters in the blogosphere have had a field day with the pompous and pretentious. The bane of our public boards is conformity and bluff collegiality, which stifles dissent. I sort of miss Carol Chumney and John Vergos on the Memphis City Council and Walter Bailey on the Shelby County Commission. Bash public officials all you want, but at least they own up to their comments and do battle face to face.

Let's hear it for impolitic questions that make the powerful roll their eyes and gnash their teeth or grin and bear it. For years, a tall, plainspoken gentleman dressed in suspenders came to the FedEx annual stockholders meeting to voice his displeasure to Fred Smith. Sometimes the questions were off the wall, and once in a while they were pretty good. As a shareholder, he never got his way, but he always got his say. And I bet he went home happy.

And some prospered through thick and thin and thinner. A decade ago, White Station High School couldn't win a football game but was a basketball and academic powerhouse. New coaches and recruiting changed that, and this year White Station added a state football championship. So did MUS in the private sector, thanks to an infusion of black athletes at skill positions. Behold the emergence of the super schools.

And the super churches. Bellevue Baptist and Hope Presbyterian, among others, combine inner-city outreach with suburban megaplexes offering first-rate musicians performing on a concert stage, spiritual sustenance, motivation, a fitness center, outdoor team sports, adult education, and singles groups.

Thursday, December 10, 2009

The Med: Help Wanted

Regional Medical Center seeks management and more funding.

Posted By on Thu, Dec 10, 2009 at 4:00 AM

There's a big management job open at the Med, but filling it is not going to be easy. Anyone want to play captain on the Titanic?

In a commentary in The Commercial Appeal last week, Gene Holcomb, chairman of the board for the Med, said the hospital has no type of service that is profitable and only 10 to 13 percent of its patients are covered by commercial insurance. Without more financial support, he said, "The Med will eventually die a natural death."

A spokesman for the Med told the Flyer that the board of directors is seeking a permanent chief executive for a salary of $450,000 to $500,000 a year, starting in March. The Med, which receives an annual subsidy of around $32 million from Shelby County government, has outsourced its management to FTI Cambio since July 2007.

The executive search will be complicated by at least two factors. As Holcomb said, the hospital's future is uncertain, with its emergency room scheduled to close next year and its very survival at stake. The Med serves indigent patients from Arkansas and Mississippi as well as Tennessee but receives, at best, partial reimbursements from neighboring states.

The second problem is that executive salaries at both nonprofit and for-profit hospitals and hospital systems in this area far exceed the $450,000 to $500,000 that the Med hopes to pay.

It is not clear how much the Med paid to individual corporate officers under its two contracts with FTI Cambio, which included a bonus for cost savings. The IRS Form 990 for 2008 lists "outsourced management services" for $7,377,225 but no specific salaries for a chief executive, chief financial officer, or chief medical officer. Monica Wharton, legal counsel for the Med, said that information could not be obtained. In 2006, the year before FTI Cambio came aboard, the Med's CEO was paid $274,722.

In contrast, the price of executive talent tops $2 million a year at one local nonprofit hospital and $10 million a year at a for-profit system in Memphis, according to a Flyer survey of tax returns, proxy statements, and other public documents.

At nonprofit Baptist Memorial Health Care, according to the 2008 IRS Form 990, 11 executives earned more than $500,000 in total compensation. Baptist has a 32 percent share of the Memphis market. Chief executive Stephen Reynolds received $1,697,000; chief information officer Jerry Brantley received $2,294,000; and chief operating officer David Hogan got $2,392,000.

Nonprofit Methodist Le Bonheur Healthcare has a 37 percent market share in Memphis. In 2008, chief executive Gary Shorb received $1,436,000; chief financial officer Christopher McLean received $744,700; and chief operating officer Peggy Troy got $665,000.

Baptist and Methodist compete for lucrative group accounts at corporations such as FedEx and local government entities such as the Memphis City Schools, entities with employees covered by insurance and able to pay their bills. They also battle over territorial rights in Olive Branch, Germantown, and other suburbs.

Bond analysts have noted that both hospital systems reported stronger-than-expected earnings and higher margins in 2009. Their tax-free status is justified by their mission of providing care for all in keeping with the tenets of their respective churches.

Indigent patients are a drag on earnings. If the Med fails, both Baptist and Methodist will get more indigent patients, says Arthur Sutherland, retired physician and founder of the Sutherland Cardiology Clinic.

"Nobody will escape this if the Med were to close," he said.

Here is the compensation for top executives at other hospital systems in the Memphis area:

• North Mississippi Health Services in Tupelo: John Heer, president, $774,000; Gerald Wages, treasurer, $695,000; Rodger Brown, vice president, $306,000.

• Baptist Health, a hospital network in Arkansas separate from Baptist Memorial Health Care: Russell Harrington Jr., CEO, $845,000; Allen Smith, senior VP, $460,000.

• Tenet Health Care, a private hospital network traded on the New York Stock Exchange, where compensation includes stock awards and options: Tenet has 14 percent of the Memphis market and operates St. Francis Hospital. According to Tenet's 2009 company proxy statement, the highest paid officers were: Trevor Fetter, CEO, $11,400,000; Biggs Porter, chief financial officer, $3,407,000; Stephen Newman, chief operating officer, $4,233,000.

• St. Jude Children's Research Hospital, a world-famous nonprofit specializing in the treatment of childhood cancer: William Evans, CEO, $711,000; James Downing, VP and scientific director, $604,000; Michael Canarios, CFO, $375,000.

Thursday, December 3, 2009

Selling Hope

A professional speaker's little book is a big hit.

Posted By on Thu, Dec 3, 2009 at 4:00 AM

You can probably win a bar bet with this one: Who is the only Memphian to have authored a New York Times number-one best-seller?

Not John Grisham, who used Memphis as the setting for some of his early novels but never lived closer than Southaven. Not Elvis Presley, whose autobiography doubtless would have been a best-seller if he had gotten around to writing one. Not Kemmons Wilson, who made the cover of Time magazine as the founder of Holiday Inns. And not Shelby Foote, whose three-volume history of the Civil War should be in every serious home library.

The answer is Don Hutson, a motivational speaker, business consultant, and co-author with Ken Blanchard of The One Minute Entrepreneur. As the title suggests, this is no tome. At 130 pages, it would fit neatly into Foote's footnotes or your coat pocket. Each of the 14 chapters is followed by a page of "one minute insights" summarizing key points (sample: "Keep your priorities in order"). The co-authors co-authored it with Ethan Willis, who shares cover billing. The Times, it should be noted, lists best-sellers by categories, one of which is "Advice and How-To."

Still, a best-seller is a best-seller. The One Minute Entrepreneur, like Blanchard's 26-year-old The One Minute Manager, is a modern publishing phenomenon. Books promote seminars and speeches, which sell tapes and more books in bulk orders or at $19.95 per single copy, which builds the brand. Hutson's claim to fame is the culmination of 40 years of hard work in the super-competitive business of sales training. At 64, he makes 75 speeches a year and embraces web-based technologies, blogs, and social media to promote himself.

The book is written as a fictional parable about "Jud," who, like Hutson, graduates from the University of Memphis, becomes a speaker, and starts his own company. Hutson says it's mostly fictional, although there are some real people and some incidents are drawn from his or Blanchard's personal experience. Hutson's company, U.S. Learning, does training for several Fortune 500 companies.

The book, published in 2008, was five years in the making. Hutson pitched it to Blanchard as a book about mentors. Blanchard and his publishing committee, swamped with proposals, were lukewarm. Hutson's proposal went on the back burner. Willis suggested changing the focus to entrepreneurs instead of mentors. Bingo.

"It wasn't so much any negatives about mentoring as it was excitement about entrepreneurship right now, with a lot of people getting laid off and doing their own thing," Hutson says.

The store of American proverbial wisdom goes back at least 250 years to Benjamin Franklin ("Time is money") and Poor Richard's Almanac. Famous practitioners include Ralph Waldo Emerson, Mark Twain (as prolific a speaker as he was an author), Will Rogers, and Dr. Norman Vincent Peale (The Power of Positive Thinking). Peale and Memphis homebuilder and positive thinker Wallace E. Johnson, author of Work Is My Play, inspired a "Believe in Memphis" civic campaign after the assassination of Dr. Martin Luther King Jr.

Hutson was browsing through 25-cent books at a yard sale when he came across one written nearly a century ago called The Miracle of Right Thought by someone he'd never heard of, Orison Marden. It changed his life. He has collected 41 more of Marden's books, calls him his literary mentor, and reads him aloud with his wife for daily sustenance.

The public's appetite for self-improvement and inspirational maxims appears to be insatiable. Every celebrity, famous athlete, fallen angel, wronged woman, and aging politician grinds out a book that enjoys a few weeks of display in the book stores and on the "new releases" shelves at the library. It is an easy transition from the sweetness of Hallmark cards to the cynicism of Stephen Colbert's "Word" segment. A new book called Confessions of a Public Speaker, by Scott Berkun, says the real secret is that audience expectations are low, so practice, be early, and don't worry.

Hutson would call a comedian's one-liners "takeaways" (as in the pearls that audience members take away from a long speech) and a contrarian book about public speaking "product differentiation." He is a proponent of both concepts.

But more than ever, in these hard economic times, he believes in mixing hope and advice with wit. Like Willy Loman in Death of a Salesman, today's audiences are longing for "a little good news." As for whether a speaker should use humor, Hutson invariably says "only if you want to get paid."

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