Report Reveals Areas Where Retailers Can Reduce Theft and Improve Store Efficiencies

A new study, sponsored in part by ADT and its Sensormatic Retail Solutions group, reveals the need for retailers to focus on technology solutions that enhance their current operational goals and combat theft without adding labor costs. “Loss Prevention 2010: Retailers Battling Shrink in Tough Times,” found that during these challenging economic times, retailers face increased pressure to identify better business intelligence, improve inventory accuracy, and embrace more innovative uses of existing investments as a means to improve profitability and conserve working capital.

“Given the challenging conditions retailers will face in the near future, any technology enhancements must help to reduce labor costs while delivering better business intelligence”. Retailers are focused on getting the most value from their existing investments in both high and low-tech tools without having to add people to review detailed data, according to Paula Rosenblum, an analyst and Managing Partner for Retail Systems Research (RSR) and co-author of the report.

A free copy of the 24-page report can be obtained at:  Loss Prevention Shrink 2010

The on-line survey of 83 small to large multi-national retailers was conducted by RSR in the fall of 2009. Retailers identified their top three sources of shrink as employee theft of merchandise, shoplifting and employee theft of cash.

Over the past year, RSR reports that 44 percent of retailers have experienced a rise in theft, likely due to challenging economic conditions. Findings indicate that top retail performers – those whose sales growth outpaced the three percent industry average – place an even higher priority on Loss Prevention (LP): 78 percent report an increase in year-over-year LP’s priority, vs. 43 percent of underperformers.

“Given the challenging conditions retailers will face in the near future, any technology enhancements must help to reduce labor costs while delivering better business intelligence,” said Rosenblum. “Tools such as Video Surveillance, Returns and Void Management, Exception Analysis Reporting and Cash Management are crucial for retailers to be more profitable. Retailers are also paying more attention to managing their item level perpetual inventory systems to gain better insight into lost sales.”

Among the more detailed findings:

• Retailers report employee theft of cash has increased from 32 to 45 percent of total losses. This appears related to challenging economic conditions and has prompted retailers to recognize the need for better business intelligence to analyze results, rather than more staff to examine report details.
• When it comes to roadblocks impeding retailers from progressing in their loss prevention efforts, 86 percent say they are challenged for capital, 41 percent lack staff to review LP and audit data (compared to 29 percent in 2008) and 36 percent have extremely inaccurate inventory systems unable to quantify areas of loss.
• Retailers identified top technology solutions that help them overcome organizational inefficiencies including:
  - 63 percent cited better business intelligence to analyze all their data. – 40 percent cited more accurate inventory tracking to identify the items being stolen.- 39 percent cited more creative uses of existing technologies.

The report further identified areas where retailers have seen a more direct effect from the economy, most importantly, a faster rise in external theft versus internal:

• Individual customer theft of merchandise (28% increase)
• Organized gangs stealing merchandise (25% increase)
• Employee theft of cash (19% increase)

Additional study findings reveal top retail performers use business intelligence tools more frequently such as exception analysis reporting at 68 percent and returns/void management at 65 percent. To enhance the value of existing investments without adding staff to review detailed data, 31 percent of respondents report using inventory tracking systems.

“The information revealed in the research indicates the methods of retail theft are shifting. As a result, loss prevention tools must adapt to those changes,” according to Kelvin Lam, Vice President of Retail and Security Products, ADT Security, Asia Pacific. “In a tough economy, resourceful retailers are looking beyond traditional tagging and stand-alone surveillance to include software based analytic tools, integration and better inventory management systems,” said Lam.

A free copy of the 24-page report can be obtained at:  Loss Prevention Shrink 2010

About ADT Security Services

ADT Security Services, a Tyco International company, is the world’s largest provider of electronic security services to more than seven million commercial, government and residential customers worldwide. ADT’s total security solutions include intrusion, fire protection, closed circuit television, access control, critical condition monitoring, electronic article surveillance, radio frequency identification (RFID) and integrated systems. ADT’s website address is http://www.adt.com/global

About the Sensormatic Retail Solutions Portfolio

The industry-leading Sensormatic Retail Solutions portfolio offers vital loss prevention and operational improvement technologies and solutions. Backed by more than 1,500 patents, the Sensormatic solutions portfolio is sold through ADT and authorized business partners around the world. From the front of the store through the entire retail supply chain, Sensormatic solutions help keep losses lower – and profits higher. Today, over 80 percent of world’s top 200 retailers that use EAS rely on Sensormatic solutions, which include EAS, source-tagging, data analytics and in-store, item-level intelligence applications. Sensormatic forward-thinking solutions also include dual EAS-RFID technology that provides item-level security and visibility in an ever changing retail environment. For more information, please visit http://www.sensormatic.com.

Business Wire

What’s on the menu in Pennsylvania? Food facts

Phila. begins phasing in its strict new labeling law.

Don Sapatkin of the Philadelphia Inquirer writes at Philly.com that Swati Kapoor, 25, was about to order a double chocolate cake doughnut when she noticed something new on the rack at Dunkin’ Donuts.  A tag said 290 calories.  In an instant, she switched to a chocolate frosted doughnut (230 calories).

“To prevent obesity,” the skinny medical student explained, munching at a table in 30th Street Station.

Philadelphia begins phasing in enforcement of its strictest-in-the-nation menu-labeling law tomorrow. This first part, requiring chain restaurants to list calories on food tags and menu boards, is a relatively simple proposition that research shows can influence ordering habits.

A similar law will take effect in New Jersey next year, and dozens of such bills are pending around the country, including in Harrisburg.

What’s different in Philadelphia will become apparent on April 1, when restaurants with individual menus must list saturated fats, trans fats, carbohydrates, and sodium, in addition to calories, with every item.

No one really knows what will come of this broader experiment in attempted behavioral change.

“The majority of people, I believe, will see this as cumbersome and an overreaction and not necessary,” said George McKerrow Jr., president and chief executive officer of Ted’s Montana Grill, who anticipates having to expand the menu at his South Broad Street location from two pages to six.

Still, just two months after Ted’s added calories alone to its menu here, responding to a New York City requirement, McKerrow has noticed a small but measurable change in Philadelphia: “Some people have chosen to eat the healthier items more often.”

Restaurants initially fought all efforts to mandate labels on menus. As the movement spread, with dozens of variations proposed across the country, the industry switched its goal to uniformity: calories, yes; sodium, no.

It has won that fight everywhere except Philadelphia. City Council approved the measure in 2008, after viewing data that showed the impact of chronic diseases related to diet – diabetes is diagnosed in 13 percent of residents, high blood pressure in 36 percent – broken down by district.

Diabetics must manage their intake of carbohydrates (including sugar); too much sodium can raise blood pressure. Both are listed on the familiar nutrition-facts label on all prepackaged goods.

“But it is really hard for people, if they eat out, to know about the sodium content,” city Health Commissioner Donald Schwarz said.

At Olive Garden, for example, nothing on the dinner menu hints at a difference between linguine alla marinara (900 milligrams of sodium, according to its Web site) and pork Milanese (3,100 mg) – or notes that the Food and Drug Administration recommends less than 2,300 mg a day total, a line that must be added by April 1.

“It would make a difference,” said Nashikai Ianscoli, 57, of Center City, who has had to go on a diet to control her blood pressure. She grew up on a farm in the South where her mother got fresh vegetables by the bushel.

Much has changed since she was a child.

“Back in the 1970s, eating out was a special occasion. What people ate didn’t matter as much,” said Margo G. Wootan, nutrition-policy director at the Center for Science in the Public Interest.

Americans now get an estimated one-third of their calories from meals outside the home. And though FDA serving sizes haven’t changed, restaurant portions, especially fast food, have doubled or tripled. Skyrocketing obesity rates – one-third of Americans are obese, about the same as in Philadelphia – defied every big fix attempted.

In 2003, an influential study examined long-term trends and calculated that a difference of 100 calories a day, either ingested or spent, could tip the balance from national weight gain to weight loss. This, the researchers concluded in the journal Science, could be accomplished through small changes that the public would be more likely to embrace.

Wootan’s Washington center, meanwhile, had been pondering how to get people to eat better. At a conference, she recalled, dietitians were presented with hamburgers, onion rings, and other fare from sit-down restaurants and asked to estimate caloric content. Even with nutrition degrees, they were off by hundreds of calories, always on the low side.

Wootan developed a model menu-labeling law and started calling dozens of policymakers around the country: Maine (the first to introduce a bill), New York City (the first to pass it), Philadelphia (the fourth to implement it).

Read more at:  Philly.com

Dunkin’ Donuts Sponsors a Midget Race Car

Midget-car racing returns to Boardwalk Hall this weekend as a cheaper alternative for drivers and fans stung by a harsh economy.

“Whenever the economy is bad, this type of racing has done well,” Len Sammons, promoter of the Atlantic City Indoor Race, said Friday, the first day of the competition.

Today’s economy affects everyone in motorsports, from NASCAR drivers all the way to their three-quarter midget car counterparts racing this weekend. NASCAR and major open-wheel series have struggled to find sponsors and fill grandstands, and some teams have shut down.But Jim “Timex” Morgan, one of the most popular drivers in the midget-car circuit, says he’s seen his sport’s popularity rise in recent years. According to Morgan, the growth is due to some higher-profile owners and sponsors attaching themselves to the midget-car series.

“We’re getting a lot of big names who can’t afford to race in other leagues, so they come here,” Morgan said. “When a big name comes on, usually others come on. The economy has helped this class of racing a lot.”

Morgan has arguably the biggest sponsor in the race, Dunkin Donuts. Morgan signed an agreement with Dunkin Donuts this season and unveiled the DD logo on his car on Friday, as well as a special Dunkin Donuts two-seater midget car.

Watch the video from the front seat of the Dunkin Donuts sponsored Midget Car:

Midget-car racing faces the same sponsorship struggles as the bigger series, but Sammons said his events are succeeding anyway

He said affordable tickets and a family-friendly atmosphere are the keys to his events’ success, even for those, such as this weekend’s, that lack a title sponsor. Tickets to midget-car events typically run between $15-$30. In many outdoor racing venues, fans can bring their own food and drinks and most parking is free.

Official attendance figures at Boardwalk Hall were not released, but on Friday, the lower seating bowl was mostly filled. Tonight’s racing typically draws even more fans.

“It’s really reasonable entertainment for a family,” Sammons said. “For the most part, other than the cost of the ticket, you don’t have to spend any more money if you don’t want to.”

Mike Lichty, owner of two midget cars and driver for two other teams in other series, has had his share of challenges finding sponsors in recent years.

“Sponsorships are very tough. Everybody wants to keep the money in their pockets, ” said Lichty, a native of Innerkip, Ontario, who is competing this weekend at Boardwalk Hall. “But there’s still money out there. There’s companies out there that are willing to spend it so you’ve just got to find the right person.”

Press of Atlantic City

The Dunkin’ Donuts and Baskin-Robbins Community Foundation Donates $175,000 to Support the Feeding America BackPack Program

The Dunkin’ Donuts and Baskin-Robbins Community Foundation today announced a $175,000 grant to Feeding America, the nation’s leading domestic hunger-relief charity. The funds will be used to support the BackPack Program, which provides food to hungry children at times when other resources are not available, such as weekends and school vacations.  The backpacks filled with nutritious, child-friendly food will be distributed in 14 markets throughout the country, including Boston, Buffalo, Chicago, Detroit, Fort Lauderdale, Hartford, Long Island, Los Angeles, New Orleans, Phoenix, Pittsburgh, Providence, San Diego and Tampa.

According to the USDA, 18.5 million low-income children received free or reduced-price meals through the National School Lunch Program in 2008. Unfortunately, just 2.1 million of these same income-eligible children participate in the Summer Food Service Program.

“Proper nutrition is vital to the growth and development of children, which is why Feeding America is so concerned about the nine million children who rely on us for nourishing meals each year,” said Vicki Escarra, President and CEO of Feeding America. “A child who is unequipped to learn because of hunger and poverty is at risk of developmental impairment and is more likely to be poor as an adult. With support from the Dunkin’ Donuts and Baskin-Robbins Community Foundation, BackPack Programs will provide extra food for students and families who need it most, ensuring that children have the resources they need to become healthy, productive citizens.”

“The Dunkin’ Donuts and Baskin-Robbins Community Foundation is dedicated to supporting the local communities where we live and work,” said Karen Raskopf, Senior Vice President of Communications for Dunkin’ Brands and Co-Chair of the Dunkin’ Donuts and Baskin-Robbins Community Foundation. “We hope to help Feeding America make a difference in the lives of the children they serve each year.”

Since 2006, The Dunkin’ Donuts and Baskin-Robbins Community Foundation has provided more than $2 million in grants to support local communities throughout the country.

The Feeding America network of food banks provides food to more than four million Americans each week through more than 63,000 food pantries, soup kitchens and other agencies.  In fiscal year 2009, 150 Feeding America food banks distributed nearly three million backpacks to children in need. 

About the Dunkin’ Donuts and Baskin-Robbins Community Foundation

The Dunkin’ Donuts and Baskin-Robbins Community Foundation brings together a wide network of stakeholders, including Dunkin’ Donuts and Baskin-Robbins franchisees, crew members and employees, to support those who serve in our communities. The focus of the Foundation is emergency response organizations and child-related causes. The goal of the Foundation is to help ensure that those heroes we depend on during a disaster have what they need to rise to any occasion, and to make a positive impact on the lives of children in the communities that we serve. To learn more about the Dunkin’ Donuts and Baskin-Robbins Community Foundation, please visit www.dunkinbrands.com/foundation. 

About Feeding America

Feeding America provides low-income individuals and families with the fuel to survive and even thrive. As the nation’s leading domestic hunger-relief charity, our network members supply food to more than 25 million Americans each year, including 9 million children and 3 million seniors. Serving the entire United States, more than 200 member food banks support 63,000 agencies that address hunger in all of its forms. For more information on how you can fight hunger in your community and across the country, visit http://www.feedingamerica.org. Find us on Facebook at facebook.com/FeedingAmerica or follow our news on Twitter at twitter.com/FeedingAmerica.

McDonald’s, Franchisees In Germany Wage Dispute

David Crawford and Julie Jargon at the Wall Street Journal write that McDonald’s Corp.’s German unit is engaged in a dispute with several franchise holders who accuse the world’s largest hamburger chain of using aggressive tactics to try to force them out of their contracts.

Court records show McDonald’s hired a team of private detectives to dig up evidence of conflicts of interest against one of the franchisees.

In other instances, at least five franchisees say, McDonald’s offered corporate jobs to franchise employees in exchange for information needed to terminate franchise holders’ contracts or ordered its personnel auditors to collect evidence against them.

The restaurant operators say these methods are part of a broad campaign by McDonald’s in Germany, one of the company’s biggest markets, to reclaim stores held by franchisees and to slow unit growth in a country saturated with fast-food outlets, an allegation McDonald’s denies.

Ulrich Bissinger, senior director of McDonald’s German legal department, confirmed that the company hired detectives to monitor one franchisee.

On Wednesday, that franchisee said he would forfeit his four restaurants to McDonald’s Germany because he couldn’t afford to post a security bond of about €4 million ($5.6 million) required to continue litigation against the company.

Mr. Bissinger denied that McDonald’s was terminating franchise contracts as part of a new business strategy. Its motive, he said, was “to protect its franchise system” from partners it believes violated its contracts.

Heidi Barker, a spokeswoman at McDonald’s corporate headquarters in Oak Brook, Ill., said the use of detectives was “an extremely uncommon occurrence that does not reflect the broader practices of McDonald’s Germany nor those of McDonald’s.”

None of the things McDonald’s Germany is alleged to have done are illegal. But while German privacy officials found it had a legitimate purpose in conducting personnel audits, they asked for changes in its approach, which violated privacy regulations. Those changes have been made, the company and privacy officials say.

While it isn’t common in the restaurant industry, hiring private investigators to gather information on franchisees “is one way to confirm whether a franchisee is within the boundaries of what’s been outlined in their agreement,” said Darren Tristano, executive vice president of restaurant consulting firm Technomic Inc. More typical of the industry is the use of company auditors and secret shoppers to monitor the service, cleanliness and quality of food at fast-food restaurants, he and other industry experts say.

Investigators are “one of many tools that franchisors use to protect their brand, but my sense is [they are] used on a case-by-case basis,” says Alisa Harrison, spokeswoman for the International Franchise Association, a trade group representing both franchisees and franchisors across a range of industries, including restaurants, retailers and cleaning services.

Frankfurt franchisee Enrico Sodano said McDonald’s began trying to force him out of his four restaurants in summer 2008, by alleging breach of contract in a lawsuit.

McDonald’s initially accused Mr. Sodano of paying his employees late on at least one occasion. McDonald’s then dispatched a team of detectives to shadow him in Switzerland last year, court records show, in an attempt to prove that Mr. Sodano was a silent partner in a Zurich pizzeria.

Such an investment could constitute a violation of company rules that prohibit franchise holders from managing or putting money into competing restaurants. Mr. Sodano, a McDonald’s franchisee since 1997, denied he was a partner in the venture, and said he was sharing ideas with a friend, not discussing a new restaurant.

Mr. Bissinger, McDonald’s German legal executive, said he ordered the detectives to collect evidence on Mr. Sodano’s alleged conflict in Zurich after the franchisee postponed a court hearing to travel there.

Weeks earlier, a German court had rejected McDonald’s original bid to force him out of his restaurants, a ruling the company had appealed.

McDonald’s presented the information collected by the Zurich detectives as evidence in a lawsuit to cancel Mr. Sodano’s franchise contract, according to court records. It won a key court decision in November based in part on that evidence. Mr. Sodano appealed the ruling.

On Tuesday, Germany’s highest civilian court said Mr. Sodano would have to relinquish his restaurants to McDonald’s or put up a bond to continue with his appeal.

Mr. Sodano said Wednesday, that he plans to return his restaurants to the company by Feb. 1, and to consider legal options for obtaining compensation from the company.

Read More at the Wall Street Journal

DDIFO Fights to Change Massachusetts Tip Pooling Law

Boston — Massachusetts Dunkin’ Donuts franchise owners went to bat for their employees this week, asking the state legislature to modify a state law that has limited or stopped many shops from accepting tips from their customers.

Rep. Linda Forry ((D-Dorchester), sponsor of the proposed change to what was described as “ambiguous language” in the law, testified before the Joint Committee on Labor and Workforce Development. She was flanked by Dunkin’ Donuts Independent Franchise Owners (DDIFO) President Jim Coen and franchise owners Robert Branca and Clayton Turnbull.

Coen told the committee, chaired by Sen. Thomas McGee (D-Middlesex/Essex) and Rep. Cheryl Coakley-Rivera (D-Hampden), that the current law was intended to prevent managers and executives from siphoning tips away from their lower-wage employees. But he said the law has resulted in unintended consequences because it “denies tips to nearly everyone in the team service environment that many quick service restaurants such as Dunkin’ Donuts utilizes, because at some point during most shifts, even when a shop manager is present, some crewmembers perform at least one managerial function.”  
The issue is the law’s definition of “managerial authority.”
 
Passed in 2004, the law says, “Tip sharing is permitted, provided that the distribution of the tips is limited to wait staff employees, service employees and service bartenders.”
The Massachusetts Attorney General, interpreting the legislation, ruled that “Anyone who has any superiority in rank over another employee cannot share or receive any tips or service charge, whether or not part of their work includes working alongside or with the employees serving the patrons directly. This includes shift leaders, supervisors, managers, assistant managers and anyone who can direct another employee on his or her job responsibilities.”

Forry’s proposal would define managerial authority to limit it to managers, who:
1) have hiring and firing authority,
2) regularly oversee at least two employees, and
3) work in an establishment where some employees are paid below minimum wage and derive much of their income from tips.

The committee took no action on the proposed revisions to the law. The committee staff told the Dunkin’ Donuts team that it may set up a working group of restaurant owners to hammer out the language of the revised legislation. DDIFO government affairs consultant Joe Giannino said he was told the legislators do not want to cause restaurants other unintentional problems.

Branca, who owns Dunkin’ franchises in Worcester and serves as the DDIFO’s Legislative Affairs Coordinator, told the committee that “the law is ambiguous. Franchise owners want to comply with the law, but we need to know what the law is.”
In his and other many Dunkin’ Donuts franchises, he said a shift supervisor “is often a teenager with three months more experience than the other teenagers.”

Branca and Turnbull told the legislators that at Dunkin’ Donuts, shift leaders work the counter to maintain good customer service during peak periods “They are there to make sure a customer who orders black coffee gets black coffee,” said Turnbull, who owns several Boston franchises including several at Logan Airport.

In addition, many shift leaders at Dunkin’ shops do not have the authority to hire or fire employees, the said. Branca and Turnbull asked the legislators “to make it simple.”
Turnbull said the tips add about $2 an hour for his employees. “This is not small beans.”

Branca said the confusion in the definition of managerial authority has resulted in class action law suits against franchise owners. Other suits have been filed on behalf of employees across the country in New York and California. In Massachusetts, “the statute mandates triple damages plus 12% interest and attorney fees, even where there was no intent to violate the statute and where no actual manager shared in any tip pool,” Coen said in prepared remarks given to the legislators.

As a result of the 2004 law, many quick service restaurants—Dunkin’ Donuts included—have removed tip jars and will not allow employees to accept tips.

Coen told the committee that Dunkin’ Donuts franchisees operate 1,350 shops in the state and employ more than 25,000 workers statewide. The sales tax revenues to the state collected from Dunkin’ operations is more than $67 million. And the total investment by Dunkin’ franchise owners in the state exceeds $3 billion.

Ironically, Dunkin’ helped create “the culture of tipping at coffee and donut shops” when the chain was founded in the 1950s and waitresses served coffee in ceramic cups at the counter, Coen said.

Dunkin’ Donuts’ first area location opens Feb. 1 in Pelham

Michael Tomberlin for the The Birmingham News writes that partners David Belcher and Bill Jenkins are out to fill a long-standing hole in the market.

Their company, RFS LLC, owns the franchise rights for Dunkin’ Donuts and will open the chain’s first area location at 5 a.m. Monday in Pelham. The opening will complete an 18-month process for RFS and signals the beginning of an expansion that could bring 21 Dunkin’ locations to the metro area over eight years.

Belcher and Jenkins decided to pick up the Birmingham market when Dunkin’ was looking to expand into the state but a previous franchise deal fell through.

“If you’re looking to get into the franchise business, why not get into a name that everybody already knows but is not already in the market?” Belcher said.

Dunkin’ Donuts has been a well-known name in Northern states for nearly six decades, but has not focused on expanding in the South — long thought to be Krispy Kreme territory — until recent years.

But Dunkin’ has differentiated itself from other doughnut shop chains with the growing popularity of its coffee, which can be found in grocery stores across the state, and the addition of bagels, muffins and breakfast sandwiches.

RFS has rights to the Birmingham metro area, stretching from Cullman to Clanton and including Jefferson, Shelby and St. Clair counties. Belcher said two other area locations are likely this year, though he declined to identify where they will be.

Jenkins said when his long-time friend Belcher came to him with the idea to buy the Dunkin’ franchise, he jumped at the chance. Belcher’s family owns Royal Automotive and has been in the car business in Birmingham for decades.

“I had been praying for additional opportunities,” said Jenkins, who is a partner in a manufacturing business. “Everything I’ve ever done worth doing, someone else asked me to do it with them, so this felt right.”

With its high-profile location at 480 Cahaba Valley Road off Interstate 65 in Pelham, Bryan Holt of Retail Specialists Inc. believes the first area Dunkin’ location will find success.

“This was hard to beat in terms of access and visibility,” said Holt, who is handling site searches for RFS.

The Pelham shop will be the second Alabama location for the chain, which opened one last year in Dothan.

Actually, this is a return to the metro area for Dunkin’. The chain operated at least one shop in the Birmingham area when the company franchised individual locations, but it closed several years ago.

While its history is tied to doughnuts, Dunkin’s coffee is helping the attract a following today. The company, a subsidiary of Canton, Mass.-based Dunkin Brands Inc., now sells more than 1 billion cups of hot and iced coffee every year.

Monday’s grand opening in Pelham will include free travel mugs to the first 400 customers along with Dunkin’ Donuts “Be My Guest” cards redeemable for a free cup of coffee or a free doughnut.

Greg Biddle, director of operations for RFS, is spending this week tying up the loose ends prior to the opening. Fifty employees have been training for the start over the past two weeks, and there was a display case of full of doughnuts in the shop on Tuesday.

The Birmingham News

Dunkin’ Schmunkin – I bet you people could create a better donut than those jokers

Chris Borrelli writes at the Chicago Tribune: Well, could ya?

Could you create the finest donut known to mankind – a monument to the art of the fried cake itself? Last year around this time, Dunkin Donuts posed this very question via a contest. If you could come up with an incredibly original donut, they would give you credit and let you name it and then they would sell it and give you some money for it. This year, not so incredibly, they have launched the 2nd Annual Create Dunkin’s Next Donut Contest. Entries will be accepted starting Feb. 8 and the winner will receive $12,000 and… whoa, whoa, whoa.

 The trouble is, when you go to the Web site that Dunkin has created for this contest, the ingredients are limited to those that any Dunkin Donut shop could reasonably sell on a normal day. You are given a number of choices – warning, this process is so addicting, you will not get any work done for the next hour – and many options (glaze, stuffing, shape, etc.), but the options subject to what can be accomplished in an average donut shop, including the more than 475 Dunkin Donut shops that are in the Chicago area.

So, no bacon cruller or wood-roasted sunflower seed long john topped Vermont maple glaze.

I came up with a pumpkin cake ring coated in a French cruller glaze and topped with a Graham Cracker crust. I called it “Man’s Inhumanity to Man,” but it was woefully lacking. I felt constrained by THE MAN.

Last year’s winner was a guy named Jeff from Alabama who came up with a toffee-sour-cream cake.

You can do better Chicago. You gonna let Alabama tell you they know better when it comes to fried food? Go to the Dunkin web site and submit your masterpiece and let us know here what you came up with.

Better yet, give us a donut that those corporate donut guys wouldn’t dare trot out. An okra and kimchi stuffed round boy coated in a glaze of BBQ and sprinkled with fried M&M’s? Well, yes we can, Chicago.

 Chicago Tribune

What Business Success Ultimately Boils Down to is Leadership

Edward Marshall at the Triangle Business Journal writes that over the past 50 years, almost every time a business has a burning platform, the weapon of choice has been a structural solution. Top leaders get terminated. The company is reorganized. There is either centralization or decentralization; re-engineering or de-construction. More recently, the ultimate hammer has been the “Matrix” form of management, ostensibly installed to cope with complexity in our businesses.

What we have failed to grasp is that, just like you can’t save your way to prosperity, you can’t restructure your way out of the fundamentals of sound business. And those fundamentals have to do with how people either do or do not work together. It’s about relationships – trust, fear, values, culture, and behavior – not who reports to whom.

The Matrix is expensive. We’re not just throwing something over one wall to another function like we used to; we’re throwing multiple somethings over multiple walls and hoping they get picked up.

Some of the things don’t get picked up. Accountability is lacking. There are unclear lines of authority and responsibility. Decisions are made slowly, if at all.

People report to two or more bosses – some dotted, some hard line – but we all know it’s politics that matter. Leadership’s influence can be undermined if some leaders have hard-line relationships to headquarters. Strategies get sub-optimized. Processes become expensive because silo systems don’t talk to each other. It’s time to move beyond the well-worn phrases asserting that focusing on people, behavior and culture is “soft stuff.” In fact, dealing with people issues effectively is the hardest work that any leader will attempt.

Digging down into the stuff that matters in those relationships – ego, power, trust, anxiety, and fears of all kinds – is not the domain of human resources or the corporate psychologist. This is the primary domain of leadership in the 21st century. It requires:

n Collaborative Leadership: This is leadership that values transparency, walks the talk, engages the work force, builds a culture of ownership, and trusts the work force with the business. These leaders are self-aware, on an inward journey, and capable of talking about their own humanness.

n New Behavior: The days of command and control are over. It doesn’t work in this complex world. Leadership needs to be about engagement, reaching across the walls, focusing on what is right rather than wrong, on what can be learned from mistakes, rather than just the mistakes.

n New Vision: We live in a bounded world, limited by resources, climate change, and economic interdependencies. The old approaches to visioning no longer apply. Leaders need to boldly seek out a new vision, not just for the business, but for their communities, nation, and the world.

n Leadership Strategy: It is time to create a new leadership strategy that embodies all of these critical elements and instills new attitudes, values, and commitments at all levels of management. It is time to develop a leadership strategy for the next generation, not just this one.

Triangle Business Journal 

Obama: Small Business Key for Recovery

President Obama puts economy, small businesses, and job creation at the center of his State of the Union address.

Kent Bernhard, Jr writes at Portfolio.com that faced with a national 10 percent unemployment rate and a corresponding erosion in his popularity, President Obama delivered his first State of the Union address tonight and offered up a laundry list of proposals aimed directly at the small businesses who do 60 percent of the hiring in America.

The president proposed eliminating all capital-gains taxes on small-business investment, creating tax incentives for small businesses to hire new workers and raise the wages of those they already employ, and steering $30 billion in money from the Wall Street bailout to community banks to lend to small businesses. In all, two thirds of the speech was devoted to the economy.

“Now, the true engine of job creation in this country will always be America’s businesses. But government can create the conditions necessary for businesses to expand and hire more workers,” Obama said. “We should start where most new jobs do—in small businesses, companies that begin when an entrepreneur takes a chance on a dream, or a worker decides its time she became her own boss.”

Just over a year into his presidency and less than a week before submitting his fiscal 2011 budget proposal, Obama proposed creating a task force of advisers to look for ways to reduce the nearly $1.4 trillion budget deficit. He also promised to freeze some discretionary spending for the next three years—a nod to those who have become more concerned in recent months about increased federal deficit spending. And he called on Congress to be more transparent about the money members add to the budget for pet projects—called earmarks.

“Rather than fight the same tired battles that have dominated Washington for decades, it’s time for something new. Let’s try common sense. Let’s invest in our people without leaving them a mountain of debt. Let’s meet our responsibility to the people who sent us here,” he said. “I’m also calling on Congress to continue down the path of earmark reform. You have trimmed some of this spending and embraced some meaningful change. But restoring the public trust demands more. For example, some members of Congress post some earmark requests online. Tonight, I’m calling on Congress to publish all earmark requests on a single website before there’s a vote so that the American people can see how their money is being spent.”

That pledge, however, isn’t stopping Obama from saying he hopes to invest in clean energy, an effort the White House says will create not only new small businesses and more jobs but also a bigger wave of innovation. Among his promises: renewed support for efforts to place a cap on carbon emissions and creation of a program to offer homeowners incentives to retrofit their homes to be more energy efficient.

“We should put more Americans to work building clean-energy facilities and give rebates to Americans who make their homes more energy efficient, which supports clean-energy jobs. And to encourage these and other businesses to stay within our borders, it’s time to finally slash the tax breaks for companies that ship our jobs overseas and give those tax breaks to companies that create jobs in the United States of America,” he said.

He added that incentives also have to be part of that picture, and hard choices, like one that would put a cost on greenhouse-gas emissions caused by burning coal, oil, and natural gas. Such a bill has passed the house but is stalled in the Senate.

“To create more of these clean-energy jobs, we need more production, more efficiency, more incentives,” he said. “That means building a new generation of safe, clean nuclear power plants in this country. It means making tough decisions about opening new offshore areas for oil and gas development. It means continued investment in advanced biofuels and clean-coal technologies. And, yes, it means passing a comprehensive energy and climate bill with incentives that will finally make clean energy the profitable kind of energy in America.”

For the long term, he also reiterated his call for financial reform, aimed at lessening risk and giving consumers more information.

“The House has already passed financial reform with many of these changes. And the lobbyists are already trying to kill it. Well, we cannot let them win this fight,” he said.

As with any State of the Union—the near-annual speech a sitting president gives to a joint session of Congress—Obama’s address served as a blueprint for where he wants to take his presidency for the coming year. And like with the speeches of his predecessors, Obama doesn’t skimp when it comes to making promises and proposals:
•He focused on making export deals, another area in which he hopes he can juice small-business hiring.
•He said he plans to steer more money to small banks to lend to small businesses. Plus, he reiterated his call for greater regulation of the entire financial system and for curbs on allowing banks to grow too big to fail.
•He called on Congress to pass a law reversing the recent Supreme Court ruling that “reversed a century of law to open the floodgates for special interests—including foreign companies—to spend without limit in our elections. Well, I don’t think American elections should be bankrolled by America’s most powerful interests, and worse, by foreign entities.”
•He’s proposing the hiring tax credit for more than 1 million small businesses.
•He’s aiming to double U.S. exports by pursuing a round of trade negotiations and strengthening ties with partners like South Korea, Colombia, and Panama.
•And finally, the president renewed his call for comprehensive health care reform, his signature issue. But he wants to reframe the issue, making the case that without such reform, the cost of health care drags down businesses’ ability to expand or create new jobs.

Obama made his case while his fellow Democrats still hold a majority in both houses of Congress, but he did so in a significantly changed political landscape ever since Massachusetts voters elected Republican Scott Brown to take the traditionally Democratic Senate seat that belonged to Ted Kennedy before his death.

That election deprived Obama of a 60-vote, filibuster-proof majority in the Senate, and that means the president will have to find a way to work with Republicans, not just on health care but on the other proposals he makes tonight.

 Read more at: Portfolio.com

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