1. Vol. 3 | Spring 2010
Employee Benefits Liability
Employee Benefits Liability
e t
Handle
with care Page 16
Fiber: the next Saving Latinos Mission:
Big Thing Page 24 boosting aviation
Page 10 Page 48
2.
3. ORIGINAL CHRONOGRAPH
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4. PUB LISHER ’ S M EMO
A Bridge to Atlanta
W
hen thinking of doing business in the States, most companies in
Puerto Rico focus on Florida as a first choice, followed by the major
northern cities of New York, Philadelphia, Boston and Chicago.
Texas has also become a candidate of late.
In our case (Fulcro Insurance), we chose Atlanta, and it has made all the
difference. Think about it. Atlanta is the capital of the Southeast, as the region’s
largest and fastest growing city (metro population: 5.2 million). It has the world’s
busiest airport (the world’s!), the most shopping center space per capita than any
city except Chicago, the most fiber optic infrastructure of any city in America,
the headquarters of some of the largest multinationals in the U.S., home of CNN
– I can go on, but you can Google the rest. It is a thriving metropolis with loads
of opportunities.
Significantly as well, it’s always been the hub of the civil rights movement, and
today that’s translating into a growing Hispanic population and marketplace.
Ramón A. (Tony) Pérez
Chairman of the Board That’s why we chose this edition of C-Level to create a bridge, to bring both
Fulcro Insurance, Inc. communities together, to add our growing Atlanta readership to our C-Level
community of unique and special readers.
In our last edition, we featured one Atlanta story: how Monica Maldonado’s
Interprint Communications has used supplier diversity to penetrate Corporate
America. This time, we bring you three stories from our neighbors to the North,
starting with our two Level Above stories: Dr. Tango’s emergence as the global
leader in online Spanish-language health information, and Precision 2000’s rise
to the top among Hispanic and women-owned airport construction companies in
the U.S. And the featured voice on Fulcrum, Charles Kuck, who argues passionately
for a different kind of immigration reform to ensure our competitiveness.
This edition of C-Level is also packed with powerful stories from Puerto Rico.
We mentioned fiber in Atlanta; well, there’s a new fiber revolution taking shape,
and it is led in Puerto Rico by Stephen Spears, one of our Daring Leaders. The
other is the General, Rafael O’Ferrall of DadePaper, who has some things to say
about patriotic leadership.
Learn the risks inherent in your Employee Benefits and how to manage them;
it can save you a lot of money, as you’ll read in our C-Story. In Next Level, the
Sheraton Casino Metro shows how it’s taking technology truly to the next level.
Last edition’s Fine Living brought you an arms collector. This time we focus
on cars, except that Pedro Muñoz is about so much more. So is Chubb, but in
this edition, Jim Fiske of Chubb Personal Insurance focuses on how to secure a
car collection. If you enjoy cars, you might enjoy planes. Pilot Chacha Fournier
certainly does. Her passion for flying to the islands is featured in Fun Living, as
CLevel | Spring 10
is the spread of aviation as her cause.
Happy reading, my friends. And let us welcome our Atlanta readers to the
C-Level Community. ¡Bienvenidos todos!
2
8. Think hero, and most people think
brave military exploits. Sure enough,
Gen. Rafael O’Ferrall has had
his share. But his heroism is about
something much closer to heart.
The stuff heroes are
T
he fate of the U.S. military base at Guantanamo went about his duty of directing the work of 2,150
Bay, Cuba, was one of the contentious issues of military personnel and more than 5,000 civilian workers
the 2008 presidential elections in the United and contractors. The main task under his command:
States. Barrack Obama signaled that he would ensuring the humane treatment of all detainees and
shut it down. John McCain argued as forcefully that he planning the shutdown of the base, a job he executed
would expand its role. with stellar reviews until his return home exactly a year
later, December 2009.
The Bush Administration had been under attack for
having allegedly mistreated detainees, conducting Home was (is) Puerto Rico. The deep satisfaction felt
controversial interrogations of known or suspected by soldiers upon landing on the one-way trip back home
terrorists at the base. To no one’s surprise, shortly after is well known. For O’Ferrall, it was deeper still.
being sworn in as President, Obama announced he
would close the base in about a year. “Everything I do in the military has one overriding
purpose,” he told C-Level, as his eyes glowed with
As the controversy swirled around the planet, Gen. emotion. “To put our flag on the map and give our
Rafael O’Ferrall was down at Guantanamo breaking into people another reason to believe in our ability to rise as
his new job as the base’s Deputy Commanding General. high as we want.”
CLevel | Spring 10
He had arrived in December 2008, as the base was
gearing up for the new marching orders sure to come It is the overwhelming constant in his life. His non-
out of the White House. military job is to serve as a general of a different sort:
General Manager of DadePaper Puerto Rico, the Cataño-
With the world’s eyes fixed on the base, O’Ferrall based distributor. The larger purpose of that job is
6
9. DAR IN G LE ADERS
yet so many people still look to the U.S. or to the next
guy for help. We can make it happen ourselves. I’ve
tried to show it in everything I’ve done in business,
in the military and in my involvement with business
associations, and there is so much more to be done.”
Enormous rewards
It is the sort of sacrifice and missionary zeal that
heroes are made of, both on the battlefield and on the
business field.
O’Ferrall finally achieved his general manager goal
in 1993, when Pach-Tech, a 100-employee packaging
supplier on the island caught fire and was about to be
closed. O’Ferrall left his cozy job at Baxter, was called
by an investor and management group and acquired
the company, which he took to new heights during the
following eight years.
“We saved 100 jobs and did some pretty creative,
trendsetting things with the company,” he recalls
– another advance in his long march towards the
ultimate victory he seeks: development, self-esteem
made of
and international respect for Puerto Rico.
Having been in the military – mainly the Puerto Rico
National Guard – since his ROTC days in college, O’Ferrall
answered yet another big call of duty. He was fresh
from achieving his lifetime goal of becoming an Army
General, a feat he accomplished upon completing a
exactly the same. “When I began in the pharmaceutical rigorous one-year course at the U.S. Army War & Senior
industry many years ago (1980s), most general manager Service College at Harvard University’s John F. Kennedy
positions on the island were filled by statesiders. That School of Government – the only Puerto Rican to have
always troubled me. With so much local talent, why ever obtained the honor.
couldn’t we hold those jobs?”
O’Ferrall was then deployed as Deputy and later
A foot soldier for medical device maker Millipore at Commander of the Guardian Mariner Task Force, an
the time, he laid out a battle plan to become general 18-month tour of duty that entailed more than 240
manager, either at that company or another. But not missions from the U.S. to the war front in Iraq, mostly
just for the sake of occupying the post. by sea, protecting the military supply chain.
“Since then, I’ve been on a mission to persuade my He assumed command of DadePaper upon returning
colleagues – other Puerto Rican managers – and the home from that mission in 2004, the only interruption
island as a whole, that we have what it takes to take being the year at Guantanamo. True to form, O’Ferrall
our beautiful island to the next level of development put in place a leadership model worthy of the military:
and job creation. Our people need so much. There is
7
so much potential that we can turn into growth, and continued on next page
CLevel | Spring 10
“We have what it takes to take our beautiful island to the next level of
development and job creation. There is so much potential that we can turn
into growth, and yet so many people still look to the U.S. or to the next guy for
help. We can make it happen for ourselves.”
10. DAR IN G LE ADERS
continued from previous page
focus on fundamental principles and take care of the
troops, the latter being DadePaper’s 80 employees in
Puerto Rico.
“To come from supervising more than 7,000 people
in one of the most intense situations in the world
(Guantanamo) to supervising 80 has not been an easy
transition,” he admitted, “but the rewards are enormous.
We have such a fantastic team here.”
“A labor of love” the worse in 2006, “we were lean and ready.”
DadePaper is one of the leading makers and distributors As the economy worsened still more in the years
of retail products in the Eastern U.S. – paper, plastic, since, pressure built for O’Ferrall to downsize further,
foam, chemical and janitorial products delivered to this time with layoffs. But he was able to increase sales
retailers, supermarkets, restaurants, cruise ships, hotels, and protect every one of the 80 jobs at the company.
cleaning companies and other clients.
“I’m all about creating jobs, not cutting them,” he
Founded in 1939 in Dade County, Florida (Miami), exclaims.
the company now boasts regional distribution
facilities in Orlando, In the coming years,
Jacksonville, Atlanta, O’Ferrall expects to
Mobile, Washington D.C., “Puerto Rico must market itself become even more active
Greensboro and Puerto more intelligently. It is part of what in the struggle to create
Rico, in addition to Miami, we must do to meet our destiny: jobs on the island across
and 12 sales offices at becoming a leading nation in the other fronts, mainly with
other locations. Caribbean and Latin America. his participation in the
Food Industry Association
The Puerto Rico operation This must be our commitment (MIDA) and the Puerto Rico
distributes approximately as a people, and those of us in Manufacturers Association
3,000 of the company’s leadership roles bear the brunt (PRMA).
15,000 products, including of that responsibility: to lead our
DadePaper’s own Victoria people to that objective.” “Puerto Rico must market
Bay line of cleaning itself more intelligently,” he
products and lines from numerous well known brands. said. “It is part of what we must do to meet our destiny,”
which is: “Becoming a leading nation in the Caribbean
Under the company’s exclusive GreenSafe initiative, and Latin America. This must be our commitment as
it has taken significant steps to become a leader of the a people, and those of us in leadership roles bear the
green-business movement sweeping across America. brunt of that responsibility: to lead our people to that
GreenSafe is a comprehensive solution that provides objective.”
green cleaning and food service supply needs, including
consulting, products and follow-up. In the military, comman–ders are asked to lead
troops into battle and take the hill. The ones who
“We’re just getting going with the initiative here succeed are declared heroes. In this case, O’Ferrall is
in Puerto Rico, and so far the results are extremely among those leading the charge on the front lines
encouraging,” said O’Ferrall. (DadePaper, MIDA, PRMA, military duty), with Puerto
Rico’s development as the hill to be charged. With
CLevel | Spring 10
One of the sternest tests of O’Ferrall’s protect-the- growth and job creation as the battle to be won.
troops philosophy came between 2006 and 2008. As
soon as he took over the reins of the company, he “It’s a labor of love,” he concluded.
executed a hiring freeze and a policy of attrition
(employees who retired were not replaced) as part of a To which we say, yes sir – salute, heels together, back
broad efficiency drive. When the economy turned for upright, head held high.
8
11.
12. DAR IN G LE ADERS
Listen to Stephen Spears explain it, and you’d think
it’s nothing. “We’re #1 in fiber,” he says casually.
Number one in fiber? That’s like Bill Gates saying
“I’m #1 in PCs” in 1995.
F
iber optics. Remember the phrase (fiber for programs and transmit them, much like we’re now able
short). Fiber technology has been around to do on YouTube.
for a while. But it’s about to get a whole lot
bigger. Gone will be the cumbersome video and web
conferences of today; connecting face-to-face
We’re all marveling nowadays at the incredible speed will be as easy as dialing a phone. Oh, and all those
and capability of phones and computer systems; how system interruptions from power blackouts, satellite
we can download digitalized music, movies, loads of disconnects and weather events – not that they won’t
photographs, video games, you name it, across a phone occur, but they will certainly happen far less frequently,
line, ethernet cable, coaxial cable or wirelessly. will be of shorter duration and will cause less damage
to equipment.
It is even more unimaginable in a business, especially
a large one, which depends on those systems to Welcome to the coming fiber revolution. Just like
manage and transmit large amounts of digital records, the digital revolution we’re still going through and
information, communications and transactions adjusting to, where an insane amount of data is stored
(customer and financial). in a tiny microchip, the fiber revolution will sweep the
world before we know what hit us.
CLevel | Spring 10
Well, imagine that speed and capability on steroids.
Multiply it many times over. You’ll be able to download Fiber today is primarily infrastructure, with fiber
the heaviest file without delay (none of that “it doesn’t cabling buried underground in rings around the city
go through because it’s too big” talk any more). Your (around the island, in Puerto Rico’s case). Delivering
cable TV company won’t just offer 500 channels with high-speed connections from those fiber cables to a
video on demand; it will allow you to produce your own home or building generally requires phone lines, copper
10
13. DAR IN G LE ADERS
FTTP is already happening. In many U.S. states and in dozens of countries
around the world, FTTP is gaining ground, as installation costs decline and the
value of such ultra-mega-speed connections rises. It’s the next Big Thing.
wires or coaxial cables. For computer connections within Construction (today Bonneville Contrac–
a building, ethernet cables are also used. ting & Technology Group), Spears was a
big part of that 1990s pre-revolution, as Bonneville was
But what if you could skip those other connectors one of the companies most hired by the government to
and receive fiber straight to your home, building or install the fiber wiring around the island.
business? It is called fiber to the premises (FTTP), and
the big deal is the absolute improvement in speed and Today, the company leads the pack. “We were the first
reception quality. After all, that’s what made fiber the contractor in Puerto Rico to move aggressively into
premier communications infrastructure to begin with, fiber optic deployment,” said Spears. “We still consider
its superiority in speed, cost and quality. ourselves the island’s best equipped fiber contractor.”
FTTP is already happening. In many U.S. states and In fact, fiber lies behind most of what Bonneville
in dozens of countries around the world, the high- does. In addition to its strength in communications
bandwidth technology is gaining ground, as installation infrastructure (all those buried lines and conduits,
costs decline and the value of such ultra-mega-speed including submarine cabling), Bonneville has developed
connections rises. It’s the next Big Thing. a unique expertise in fiber-based integrated building
and office systems.
That includes Puerto Rico. The recently built Sheraton
Convention Center Hotel & Casino, for example, boasts a That is, your entire security system (video cameras,
fiber-driven network (see related story on page 36). The access controls, perimeter detection), as well as your
Puerto Rico Telephone Company spent billions of dollars company’s computer networks and phone systems
in the 1990s on a state-of-the-art fiber infrastructure. (voice, data, video and internet, landline and wireless),
Today, a growing number of businesses on the island and your electrical wiring and infrastructure, can all
are waking up to the possibilities of taking that fiber be integrated with optimum speed and capabilities by
the rest of the way. using fiber optics.
Like the speed of light Bonneville can do each of these things separately, but it
is the fiber-based integration that most brings excitement
Enter Stephen Spears. As the president of Bonneville to Spears’ otherwise calm and cool demeanor.
continued on next page
1
1
CLevel | Spring 10
14. DAR IN G LE ADERS
continued from previous page
The biggest wave yet
“We have set ourselves apart and given ourselves
significant competitive advantages by being the first to Spears, a native of Indianapolis
employ new tools,” he says matter-of-factly. and an engineering graduate of
Indiana University, had moved
What he does not make a big deal of is the biggest to San Juan in 1973 to work
deal of all: his company is the leader of an industry for phone utility ITT. Phone
(FTTP) that is about to take off like the speed of light. infrastructure construction was
in full swing at the time, and his job was to inspect work
Friamente calculado performed by contractors.
Fiber is optic because it uses light instead of other Including Bonneville. “I met Robert Bauchman and we
forms of energy, which allows it to transmit large hit it off immediately,” recalls Spears. “They were looking
amounts of information far faster and less expensively for a person to oversee the Puerto Rico operation,
than metals like copper. It does it using glass and plastic someone who knew the industry and the local market
cables that are much thinner and also significantly less and spoke the language, and we struck an agreement.”
expensive than metal.
That was 1984. Five years later, the company was
Installing fiber in the shorter distances from the acquired by Italian conglomerate Pirelli, which was in the
underground infrastructure cabling to the home or midst of a buying spree, acquiring numerous companies
office, however, has generally not been less expensive in the Americas. Spears was retained to run the Puerto
that the alternatives. But Rico operation, which
as the cost has declined of Your entire security system included a diversification
late and the value of speed (video cameras, access controls, initiative that took the
and integration has gone
up, the equation has
perimeter detection), as well company into voice/video/
data wiring of businesses,
changed in its favor. as your company’s computer high-end security systems
networks and phone systems and other lines of business.
Spears, who considers (voice, data, video and internet,
himself a calculated-risk landline and wireless), and your “That really opened my
taker – “friamente calculado
wiring and infrastructure, can eyes,” he added. “That’s when
is the Spanish phrase that I learned about all the things
best describes me” – had no all be integrated with optimum we could do as a company.”
way of knowing this when he speed and capabilities by using
took the risk of diving deep fiber optics. In 1992, Pirelli decided
into fiber nearly 20 years it had overreached too far
ago. At the time, it was the new thing in infrastructure, beyond its core business (tires) and market (Europe) and
and he began to ride the wave. decided to divest Puerto Rico. “I called Steve Bauchman
and we bought back the company.” A few years later,
In fact, Spears has made a career out of spotting Spears became majority owner.
emerging trends and riding them as far as they go,
before hopping on the next new wave. It is a Bonneville The company lost its step following the communications
tradition. The company began in Idaho in 1946, long crash of 2002, when companies like MCI, AT&T, WorldCom
before Spears’ time, when founder and then-owner and others retrenched and the economy slowed. But by
Robert Bauchman began to ride the wave of power- 2004 it was back riding waves and breaking new ground,
line construction across the United States, particularly including in the U.S. Virgin Islands and the Caribbean,
in rural communities. which grew to represent 25% of all revenues.
CLevel | Spring 10
When most power lines were built and that business The key has been fiber optics, and if the current global
became saturated, building telephone lines became groundswell driving the FTTP wave is any indication,
the new wave, and Bonneville began riding it straight Spears is in for quite a ride indeed.
through the 1970s. And straight into Puerto Rico.
Surf’s up.
12
15.
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19. C - S TO R Y
Mistakes in the handling of employee benefits
are costing dearly. An expert roundtable suggests
ways of turning that problem into an opportunity,
with visionary prevention and engagement.
to gain
17
7
CLevel | Spring 10
Leve
20. C - S TO R Y
L
aura Perez was touched. Still letter. It was from Laura’s attorney, roundtable to look into the growing
in the hospital a day after threatening to sue unless the risk of employee benefits liability
giving birth to a healthy company covered the hospital bill and what employers can do about
seven-pounder, she received a and a whole lot more. The company it. Also in the discussion were
gift basket with a moving note from looked into it, became convinced Angie Lugo, Baxter’s HR Manager
her boss and a visit from a group of that the case would be a sure loss, on the island and president of the
her closest workmates, including the and decided to take the hit. Puerto Rico Chapter of the Society
Human Resources manager, Monica. for Human Resource Management
After 12 years in this company of 75 Under the radar (SHRM); Ricardo Del Campillo,
employees, they had become family. President of Fulcro Insurance; and
Stories like Laura’s never have a Julio Ortiz, Partner of the Employee
When she took little Paola to the happy ending. Employees trust their Benefits Practice at Fulcro.
office a month later, they practically employers, and employers trust their
threw a party. The whole company, HR departments, to know what to Employee benefits, it turns out,
it seemed, was paralyzed for the do. Employee benefits have terms are not gifts, as most employers and
hour she was there. and conditions. Someone in the HR administrators – and employees
company is supposed to have the – seem to believe.
No sooner had Laura returned expertise to master them.
to work following maternity, than You may be extending a set of
Paola fell ill, diagnosed with a When that someone is not benefits to attract top talent and
serious circulatory condition. The assigned, and when the company enhance motivation and retention
doctor ordered the girl hospitalized does not compensate by using an of current employees. But once you
immediately, with no clear prognosis. expert advisor, errors and omissions do, you become in effect a trustee,
When she arrived at the hospital, are bound to happen, mistakes that custodian and fiduciary of the
Paola was rushed in without a wait. can cost employers dearly when benefits and are held accountable
Laura, crushed by anxiety, sat and an employee becomes a victim and under federal and local laws to their
slept at her bedside the entire two suffers the consequences. proper administration.
weeks of treatment.
Laura’s story is hypothetical. Real- All about ERISA
In the end, the girl recovered fully. life stories are not. Like an employee
Family and workmates celebrated who retires based on a income The federal law, the principal one
with great excitement and relief. benefit of $3,000 a month, only to you should know and learn well, is
Until Laura received the letter. It was receive $2,000 because the company ERISA, the Employee Retirement
from the hospital, and she opened it failed to move the funds to a higher- Income Security Act of 1974.
with a smile, recalling the excellent yielding investment as the employee
service from the entire staff, who had requested and had counted on. Don’t let the word “Retirement”
probably saved Paola’s life. As she Or when an employee dies and her throw you off. While the original
read it, the smile turned to a frown, second child does not receive his intent of the law was retirement,
and she fell on the couch. Stunned. share of the life insurance because it soon became the law of the land
the company failed to report him for all types of employee benefits:
The employer had failed to file when he was born 15 years prior. health and life insurance, Social
the paperwork to include Paola Security, disability, profit sharing,
in the supplemental coverage “Unfortunately, these mistakes stock options and others.
routinely extended to all newborns happen all the time,” said Reynaldo
of employees, which would have Quintana, a partner at the Hato The wording in the law is clear:
included the hospitalization, and Rey firm Baerga & Quintana. “They benefits include “any plan, fund or
CLevel | Spring 10
Laura would now have to pay the simply remain under the radar and program established or maintained
$65,000 bill. are not reported widely.” for the purpose of providing benefits
to employees or beneficiaries.”
Monica, the HR manager, could Quintana was one of four experts
only apologize, until she received the who participated in a recent C-Level Who is liable is equally clear:
18
21. C - S TO R Y
anyone employed or subcontracted Benefits Liability (EBL) coverage, by insurance companies. If an
to administer, design and/or manage structured as an endorsement to employee gets sick following the
an employee benefit, including any- a General Commercial Liability effective date of coverage and the
one with “any discretionary authority policy. For investment risks, there employer maneuvers to allow for
or control over the management of is Financial Liability Insurance (FLI). coverage, it may then get in trouble
any type of benefit.” The roundtable discussion focused with the insurance company.
primarily on the administrative side,
Anyone. Any benefit. Any autho- given the widespread incidence “Sometimes helping an employee
rity. That includes you, anyone who of errors and omissions, but the carries risks as well,” said Ortiz.
works for you and any vendor you exact same principles apply to the
contract to design and manage any financial. Part of the problem, he added,
portion of your employee benefits is that “since most companies in
(investment firms, consultants, “Most of these mistakes are the Puerto Rico are too small, with fewer
actuarial firms, law firms, accounting result of ignorance of the law. than 100 employees, they don’t have
firms, administration firms, the They’re not intentional or malicious,” the resources to strengthen their
bank’s trust department, etc.). said Fulcro’s Del Campillo. “But that HR department or subcontract an
Roundtable members suggest five steps to get an employer’s employee benefits house in order. The first four focus on prevention. If that fails, take the fifth: buy an Employee Benefits Liability
insurance policy. Left to right: Ricardo Del Campillo, Angie Lugo, Reynaldo Quintana and Julio Ortiz.
The law makes a distinction doesn’t exempt companies from expert HR consulting firm. Generally
between errors and omissions in liability. They need to learn the law the top executive delegates HR to a
the benefits’ management on one and make the changes necessary non-expert at the company, who
end – mainly the administrative to prevent these mistakes and does the best he or she can. And
and clerical handling of such administer their benefits in an error- that’s where mistakes can happen.”
things as enrollment, termination, proof way.”
interpretation and records – and “This absolutely needs to be
19
the investment of funds on the Some employers bend the rules handled by an expert. It’s too
CLevel | Spring 10
other end. to help an employee who would sensitive,” said Baxter’s and SHRM’s
otherwise not be eligible for a Lugo. “It is challenging enough to
To protect companies from the benefit, thinking they’re helping manage employee benefits at a
risk of administrative mistakes, these employees. Retroactive dates, company of our size that can hire
insurance companies offer Employee for example, are strictly enforced continued on next page
22. C - S TO R Y
continued from previous page
the experts, so imagine a small “most law firms delegate employee about ERISA than employers, and
company without the expertise.” benefits to the tax department, since they use that knowledge in labor
employers tend to focus more on the negotiations.”
The problem is made worse, she tax breaks of employee benefits than
added, because the island’s four- in managing them free of mistakes.” Second, advise employees
year recession has led to cutbacks in well. Sit with them and make
employee benefits. “With companies What do employers need to do sure everyone knows the terms as
cutting back, they’ve been even less to avoid errors and omissions? The well as the updates and changes
willing to invest in strengthening panel advised five basic steps. First, needed along the way in case of
ERISA compliance.” make sure you interpret all benefits such changes as newborns, deaths,
well and master the terms and terminal conditions, disabilities,
Yet another part of the problem, timetables they impose. employee terminations, and more.
according to Ortiz, is that HR at
R Even promotions sometimes trigger
most companies is seen as a cost upgrades in benefits.
center where the main priority is to
keep costs down instead of making
a Thi focus on records handling.
ird,
sure employees are well assisted “It’s really clerical most of the time,
s
at every turn. b
but this is the sort of thing that
can come back to haunt you
“It keeps senior executives if not administered well,” said
from watching the details thatt Lugo.
create the potential liabilities
e
that later turn into higher e Fou
urth, train, train and train some
costs if not managed well,” he more Make sure your team, internal
e.
said. “Cost control can get very
r and external, knows what it’s
myopic.” doing from the clerk up to the HR
g,
mana and even senior executives.
ager
Five steps to prevention C nges in your team? Train again.
Chan
R ember ERISA: the company is
Reme
One of the puzzles of the
h liable for anyone with any degree of
e
employee benefits conundrum control and authority.
t
is the low incidence of lawsuits “Puerto Rico has a high number of
in Puerto Rico, compared to the HR professionals and administrative Finally, buy a fail-safe Employee
states. staff who simply find ERISA too Benefits Liability policy to guard
complicated,” said Lugo. “And the against any mistake that gets away
“The issues are resolved Boricua truth is that the law is too full of from the renewed attention, training
style,” said Del Campillo. “Employers legal jargon that’s hard to follow and and controls. It’s inexpensive
talk to insurance companies, interpret. So every company needs to compared to other types of coverage
everyone consults with their lawyers, simplify it for its HR personnel, so HR and to the settlements it will help
payments are made, and life goes will then simplify it for all employees. you cover.
on. Time goes by, we keep going Otherwise, no one will interpret
from renewal to renewal almost particularly well and mistakes will “The policy is no substitute for
automatically, and no one stops to continue to take place.” rigorous prevention, but it’s a great
fill the gaps.” complement,” said Ortiz.
Among those who know the law
The gaps, however, are costly, well are the island’s labor unions, Engagement
CLevel | Spring 10
as employers continually settle to which represent mostly government
avoid lawsuits. “It would be better workers. Quintana, who represents There is one additional approach
for all involved and far less costly management in labor and that can be thrown into the
to learn the law and hire an expert employment litigation, can vouch mix. See the management of
team,” added Quintana, adding that for that. “Union leaders know more employee benefits, not so much as
20
23. C - S TO R Y
a defensive policy to avoid mistakes,
costly settlements and lawsuits, Ricardo Del Campillo
but rather as a proactive tool to
enhance employee engagement “Most of these mistakes are
the result of ignorance of the law.
and significantly raise the level of
They’re not intentional or malicious.
motivation, commitment and sense But that doesn’t exempt companies
of ownership at your company. from liability. They need to learn the
law and make the changes necessary
That is, to the extent an employee to prevent these mistakes and
feels cared for, guided and advised administer their benefits in an error-
during the year (not just at renewal proof way.”
time) – if you put in place a
humane process to follow the life
of each employee and tailor his or
her benefits along the way to fit
changing circumstances – you will Angie Lugo
be loved even more as an employer.
“This absolutely needs to be
handled by an expert. It’s too
This shouldn’t be just about
sensitive. It is challenging enough
avoiding a Laura and Paola debacle,
to manage employee benefits at a
but rather having Laura feel the company of our size that can hire
care that conscientious benefits the experts, so imagine a small
management can project. It’s because company without the expertise.”
you care about her and want to see
the benefits you offer enhance her
life – to deepen the sense of family
at work – not just manage them
merely as an administrative policy
to prevent a settlement or lawsuit. Reynaldo Quintana
“Unfortunately, these mistakes
It is not unlike Know Your Customer happen all the time. They simply
laws in the banking industry, where remain under the radar and are not
terrorism fears moved the federal reported widely. Most law firms
government to force banks into delegate employee benefits to the
gathering additional data about tax department, since employers
their customers. Smart bankers tend to focus more on the tax
have turned that to their advantage, breaks of employee benefits than in
using Know Your Customers as a managing them free of mistakes.”
tool to build closer relationships,
instead of seeing it as a cumbersome
regulatory burden. The cry at those
banks is: KYC is marketing, not Julio Ortiz
compliance. “Since most companies in Puerto
Rico are too small, with fewer than
Likewise with employee benefits 100 employees, they don’t have the
management. “Why not see it as resources to strengthen their HR
21
part of your social responsibility as department or subcontract an expert
HR consulting firm. Generally the top
CLevel | Spring 10
employers,” asks Lugo.
executive delegates HR to a non-expert
at the company, who does the best he
Take it to that higher level, and or she can. And that’s where mistakes
turn a potential crisis into soaring can happen.”
productivity and results.
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26. LEV EL AB OV E
He dreamed of becoming a doctor.
He ended up changing the world of
health and spreading wellness habits among
Spanish-language citizens everywhere.
Driven by vocation
R
oberto Estrada dreamed of becoming a doctor wholesale company with reps throughout Latin America,
as a kid growing up in Nicaragua. “I dissected which he sold handsomely in 1999.
lizards for hobby,” he recalls. Sure enough,
when the time came he enrolled in med school And then, suddenly, he was back. Fate being the
in Monterrey, Mexico, excited about the passion-filled curious creature that it is, Estrada combined his
career he was embarking upon. entrepreneurship with his love of health and discovered
a path that would lead him back into medicine.
Until one fateful class changed the course of his life.
That day, the day he had to deal with his first deceased Well, not medicine in the classic doctor sense. But
corpse – right then and there he figured that perhaps medicine nonetheless. Estrada and a group of partners
being a doctor was not the path for him. and health experts launched Dr. Tango, an internet
venture to create and provide Spanish-language health-
After much soul searching, he decided to follow in related web content for information-starved consumers
CLevel | Spring 10
his father’s footsteps and take up engineering, in his throughout Latin America. “Tango” is a cute reference
case chemical (dad was electrical), later complementing to the popular Argentine dance, meant as a symbol of
with an M.A. in Business (Vanderbilt University). all things Latin American.
The entrepreneur in him led to the launch of his own They managed to raise some venture capital, as was the
successful business, a raw materials and paper products norm for web ventures at the time, and away they went.
24
27. LEV EL AB OV E
Problem was, they caught the tail end of the internet one special new client. Inspired by the content, Univision
bubble, and the bubble burst just as they launched. “We Interactive Media struck a deal with Dr. Tango for the
didn’t even get to go online,” he told C-Level during a production of HolaDoctor (holadoctor.com), a website
phone interview from his office in Atlanta. that goes well beyond the content and consumer reach
of MiDieta.
Bold vision
HolaDoctor, slated for launch during the second quarter
Still, Estrada and partners would not let go, insisting of the year (not yet online at press time), is described in
on the wisdom of the vision. Dr. Tango, they pledged, the launch release as “the most comprehensive Spanish-
would one day become the dominant source of Spanish- language health destination anywhere. Featuring
language web content for health-related matters – a culturally appropriate content, interactive health tools
sort of WebMD for Latinos. and a vast knowledge of health, wellness and insurance,
HolaDoctor will deliver an unprecedented service to the
Undeterred, they continued developing the content Hispanic user in the U.S.”
– rich, thorough content, created by some of the top
minds in medicine. It became a digital encyclopedia, HolaDoctor is “one of the deals we’re banking on
complete with thousands of hyperlinks to related for our future,” Estrada said, anticipating “tremendous
websites. traction” from Univision’s position as the preeminent
leader in U.S. Hispanic media, with an integrated
A few clients began purchasing the content for platform that spans TV stations, radio,
their own sites, mainly hospitals that needed continued on next page
Spanish content to attract Latino patients and keep
them informed.
The company was also hired to produce those
websites, not just supply the content, as well as to
provide the daily management and maintenance
of the sites, including English-language ones.
English-to-Spanish translation of health sites
became yet another revenue stream.
Word spread and the business mushroomed,
as Dr. Tango did indeed become the lead
player in Spanish-language web content for
corporate and government clients, instead
of the company’s own trailblazing site, as
had been the original vision.
That dream would be realized later,
when Dr. Tango launched MiDieta.com,
a full-feature site focused on nutrition,
exercise and weight loss.
“Obesity is one of the most serious
health issues facing Hispanics and
Latin Americans,” said Estrada.
25
“MiDieta is one way of contributing
CLevel | Spring 10
to the solution.”
Hola, Univision
MiDieta caught the attention of
28. LEV EL AB OV E
continued from previous page B-to-C channel to distribute its content and accomplish
internet and mobile, and reaches virtually the entire its mission, it remains just as focused on growing the
45-million-strong Hispanic population in the states government and business-to-business segments.
with one channel or the other.
For business clients, Dr. Tango has become a one-stop
“Our business-to-consumer work will focus on shop for web-driven multicultural health marketing,
HolaDoctor from that moment on,” he added. He a vision that goes well beyond content production.
expects the site to rule the Spanish-language health The latter remains the cornerstone – “we remain
space, commanding substantial advertising revenue primarily a content producer and distributor through
With all that business, buzz
and activity, Dr. Tango has
accomplished the goal it set for
itself when it opened in 1999, the
goal it reaffirmed in the middle of
the internet bubble that nearly
crashed all hopes. The company
has become the undisputed leader
in Spanish-language health and
wellness content and services.
from health-industry clients looking to target that MiDieta, HolaDoctor and our clients’ own websites” –
market segment. but the company has turned to marketing solutions
as additional revenue sources and to attract content-
The wind behind HolaDoctor is the growing concern driven business.
among Hispanics – and among citizens of all races and
creeds, for that matter – with the worsening state of Translation is still a source of significant work, even
our health and the urgent need for information to help though Estrada is evaluating its future in the company’s
people take better care of themselves. emerging mix of solutions. Dr. Tango is also hired by
corporate clients for the back-end design of wellness
In health circles, that’s called wellness, the mix of programs for employees and customers. The company
steps a person can take to improve holistic health offers what it calls cultural wellness appraisals, and it
and prevent illness. “What we want is for people not sells access to its million-name database for marketing
to get sick, which is a lot better and less expensive campaigns and health maintenance programs. Making
than spending so much time from doctor to doctor,” available bilingual health and wellness coaches
expressed Estrada. represents yet another revenue source
He quotes government figures showing that 93% of Then there are the special behavior-change initiatives
all health spending goes to the treatment of illness, Estrada finds as fulfilling as anything the company is
while only 7% is destined to prevention and wellness. doing. Done primarily with government entities, these
projects allow Dr. Tango to contribute its content and
“We need to reverse that ratio, and that represents an expertise to influence wellness-driven behavior in a
immense business opportunity from our perspective,” more direct way
asserted a confident Estrada. “Most illness is preventable,
CLevel | Spring 10
and our mission is to show the Spanish-speaking world The biggest one is the World Bank’s Conditional Cash
how to do that. Transfer Program, a sort of welfare program for residents
of developing countries. Participating citizens receive
Beyond content cash (deposited directly into a debit card account) only
if they agree to change to preventive behavior and
As the company launches HolaDoctor as the main health management – to exercise more, for example,
26
29. LEV EL AB OV E
and include fruits and that are bankrupting health
veggies in their diet. care systems in the U.S. and
throughout Latin America. The
The program has drawn best thing a person can do is
millions of participants in prevent it, but once you have
17 Latin American countries. it, the challenge is to adopt
Dr. Tango’s role: to assess healthy habits to manage it and
the progress made by keep it from sending you in and
participants, manage the out of doctors and hospitals.”
program’s database and
provide orientation, the Fateful path
latter stemming from the
company’s content. With all that business, buzz
and activity, Dr. Tango has
“This has become incredibly accomplished the goal it set
satisfying for all of us – to see for itself when it opened for
the impact this is having on business in 1999, the goal
people, especially those who it reaffirmed in the middle
enter the program for the of the internet bubble that
money and quickly convert nearly crashed all hopes.
to wellness as a habit when
they realize the huge benefits The company has become
to them and their families,” the undisputed leader in
Estrada said, sounding again Spanish-language health and
very much like the doctor he wellness content and services,
once dreamed of becoming. changing the lives of untold
citizens in countries around
Then there’s the Florida State Department of Health the world. And more so once HolaDoctor goes online
and its anti-obesity program, for which Dr. Tango and sweeps the marketplace.
developed a robust website that draws on MiDieta and
includes a popular Nutrition Center. For Estrada, the vision and the passion were reaffirmed
following the recent passing of his father at 76 years of
The company was recently hired by Merck to age.
conduct yet another behavior-change project, this
one working with 70 Hispanic diabetics and clients “He had become morbid obese,” he recalled. A rare
of HEB Supermarkets, the biggest chain in Texas. The pause followed. “I watched him as he aged and grew
individuals are to follow a healthy lifestyle to control ill. He had always been such a disciplined person, so in
their condition, and Dr. Tango is following their every control of everything around him. But starting in his
step to report on and later promote the results so that 40s, he became unable to control his weight, and it just
other Hispanic diabetics can follow suit and improve spun out of control. So I’ve seen up close the damage
their lives. bad health habits can cause.”
“The treatment of diabetes has become one of the And now he’s as determined as ever to go deep into
fastest-growing health care costs in the system among his medical vocation, down this fateful path life had in
Latinos,” revealed Estrada. “It is one of the main conditions store for him, and do something about it.
MiDieta.com caught the attention of one special new client. Inspired by the
content, Univision Interactive Media has struck a deal with Dr. Tango for the
CLevel | Spring 10
production of HolaDoctor (holadoctor.com), a website expected to sweep the
U.S. Hispanic market and attract substantial advertising revenue.
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32. LEV EL AB OV E
For most people (even civil engineers), airport runways
are simply roads planes use to land and depart.
For this married executive couple, they became
a path to reaching new heights.
S
eventeen Days in December. It sounds like the construction and repair is $500 per minute.
title of a blockbuster movie but is actually a
real-life episode of Precision 2000’s latest flair Guiomar Obregon and Carlos Sanchez do not blink at
for the dramatic. the chance. More than ten years in runway construction
and repair, mostly at Hartsfield-Jackson, have given
The scene is Dekalb-Peachtree Airport, November them all the confidence they need. Precision 2000,
2009. Atlanta’s second busiest airport – a reliever to their firm, wins the bid and off they go.
Hartsfield-Jackson International Airport, the world’s
busiest – faces a tough decision. It needs to rebuild its Leaner, faster
main 6,000-feet, 40-year-old runway and has only two
alternatives: shut down the runway for about three Airport runways must rank as one of the most
weeks and work 24/7 to get the job done, or string demanding construction jobs around. “Contractors have
it along for more than two months working only at to work within very strict parameters and deadlines,”
night. explained Obregon, who as Precision’s CEO is primarily
in charge of the administrative and financial side of the
The decision: shut it down. But to minimize the business. Sanchez, the firm’s president, runs the field.
pain, PDK (that’s the airport’s travel code) needs a really,
really fast contractor with proven credentials in runway “At Hartsfield, for example, most of the work must
construction, as there is zero room for errors or delays. be done between 11:00 p.m. and 6:00 a.m.,” she added,
CLevel | Spring 10
The runway has to be perfect on the first try. “and many times those seven hours are barely enough
to get the job done, so we have to deploy all the means
To screen out anyone not confident enough to pull it available to save every possible minute.”
off, as well as make sure the job gets done on time, the
airport imposes a whopping penalty of $1,300 for every Like cutting-edge equipment and technology. Precision
minute of delay. The typical penalty in airport runway uses volumetric concrete mixers, specialized trucks that
30
33. LEV EL AB OV E
carry the sand, stone, all the information
water and cement in available at the office,”
s e p a ra t e c o m p a r t - said Obregon.
ments and mix on-site
to precise specifica- It’s all part of Preci-
tions programmed into sion’s Enterprise Re-
the truck’s computer source Planning (ERP)
system. system, which inte-
grates all components
“This saves a large of an assignment and
amount of waste, since makes it available to
the concrete comes the decision makers.
out ready to use, in the
exact volumes needed That includes such
and with superior Neither executive believes the Hispanic and woman-owned label will mean much in practical terms going things as the food
quality,” said Sanchez, forward, as the company has “graduated” into the big leagues and is now able to compete head-to-head for and supplies needed
who met Obregon any-size project without the need for minority preferences. for round-the-clock
when both studied at work, all the suppliers
the Colombian School of Engineering in their native who must join the project team, back-up systems
Colombia. “It’s also a lot faster.” and equipment in case anything should break down,
blackout-proof power generation, lights for night time
The saved waste is critical on tight deadlines, given work, even shift and sleep schedules to make sure
the time and workers it takes to keep a construction everyone’s available and well rested.
site as free of debris as possible. “We minimize the mess
and clean constantly. It’s important not to let the debris The latter, in turn, keeps accidents to a minimum.
accumulate,” he added. “One thing that can throw off our timing is an accident,
so we take every possible prevention measure,” added
Also reducing time and waste are the company’s Sanchez.
hydraulic hammers, which are able to break concrete
and rock faster and with less of a mess. Then there Weather is a particularly daunting challenge,
are the sci-fi-sounding robotic stations, computer- particularly since the fast drying of concrete requires
programmed equipment that delivers flatter and faster precise conditions. “Regular construction jobs allow
topography and surface finishes. more flexibility in terms of deadlines and equipment
in case it should rain or if the temperature gets cold,”
The human factor is also fine-tuned. Relentless he explained. “But we have to finish the job by 6:00
continuing education and training produces engineers a.m. or else, so we go in with special heaters and
and personnel able to manage the most demanding contingencies to make sure the concrete dries real fast.”
constraints, and project managers are given unusual
decision-making leeway without going through other Yet another big concern is airport security in this age
channels. of terrorism fears. “Our people and equipment must
have all the required clearances,” said Sanchez. “After
“I’m available 24/7 when we’re working on the field, so many years working at these airports, we’ve built the
but they’re able to make most decisions on their own,” trust to ease this process, but for each job we still have
said Sanchez. to go through the system.”
By 6:00 a.m. or else That is also the case for quality control, since the
airport’s inspectors don’t have much time to do their
CLevel | Spring 10
To facilitate field decisions further, “our project check-ups before 6:00 a.m. So Precision
managers can access the company’s server and use continued on next page
“At Hartsfield, most of the work must be done between 11:00 p.m. and 6:00
a.m.,” said Precision 2000 CEO Guiomar Obregon. “Many times, those seven
hours are barely enough to get the job done, so we have to deploy all the
means available to save every possible minute.”
34. LEV EL AB OV E
continued from previous page
hires a supplier to go through the motions during the adding that the company will include military bases
job and then provide the final sign-off (checking mainly in its plans. The first overseas bid is underway at the
the readiness of the concrete) minutes before deadline. Barranquilla Airport in Colombia.
‘We’re more than ready’ “We’ve already done work at two military bases here in
Georgia: Robins Air Force Base and Dobbins Air Reserve
It is no wonder, therefore, that when the time came Base,” added Obregon. “Both jobs went extremely well,
to tackle the Dekalb-Peachtree runway reconstruction, and we feel confident we can land additional bases in
Precision was ready. the coming years.”
“It required tremen– The company also has
dous planning,” recalls its sights set on non-
Obregon. “Nothing airport work. In fact,
could be left to chance. We had meeting after meeting 60% of revenues currently come from such assignments,
to go through all possible contingencies and make sure with only 40% stemming from the sexier airport jobs.
we had everything we needed going in.”
Precision engages in a wide range of municipal and
Sure enough, when the day arrived, Precision’s trucks, commercial projects, primarily having to do with roads
equipment and personnel were outside the gate ready and pavement, earth movement and erosion control,
to attack this former military airport. And attack they streetscaping and decorative concrete, and water
did. The 17-day PDK job was completed in record time, infrastructure.
several days ahead of schedule and comfortably below
budget. But if you thought the company was overwhelming
the competition by deploying its airport-tested speed
The stunning success story is already helping Precision and planning advantages in most commercial and
CLevel | Spring 10
open doors at other airports, part of the company’s municipal bids, think again.
growth strategy of penetrating markets throughout the
U.S. Southeast and overseas. “Airport operators pay a premium for speed, since
their jobs always have a strict deadline that require a
“We’re more than ready,” said Sanchez confidently, higher expense,” explained Sanchez. “Most municipal
32
35. LEV EL AB OV E
and commercial owners, on the other hand, are looking They married at the time and turned Precision into a
for the lowest bidder, and those jobs usually allow for Hispanic- and woman-owned company, facilitating the
a longer period of time, so they don’t require the more bid process further. Today, the company’s vision is to be
expensive specialized equipment and manpower we the largest Hispanic- and woman-owned construction
have for time-sensitive projects.” company in America.
To be sure, Precision’s precision planning and attack But while that’s the stated vision and remains a net
mode provide a leg up, but the company must go toe- plus in branding and marketing, neither executive
to-toe on other bid selection criteria. “We do very well believes the Hispanic and woman thing will mean much
in those bids,” assured Sanchez. in practical terms going forward, as the company has
Head to head “graduated” into the big leagues and is now able to
compete head-to-head for any-size project without the
It’s a long way since his days as a staff engineer at need for minority labels or preferences.
Hartsfield-Jackson shortly after completing an M.S. in
Technology Management at the Georgia Institute of “We have the certifications, but we don’t use them
Technology in Atlanta. It was there that he learned most of the time,” said Sanchez. “Minority set-asides are
what it takes to succeed in runways and other airport not what they used to be. Governments and companies
projects. require you to be extremely competitive. Just being a
minority company won’t get you the deal, and less so if
“I spent a lot of time with contractors, and they kept you’re bidding for a large project.”
telling me I would do very well if I launched a Hispanic-
owned firm, since the airport and the government set Added Obregon: “Corporate America used to give
aside a certain percentage of all construction projects mainly small projects to Hispanic- and woman-owned
for Hispanic companies, and there wasn’t any back then. companies. We find that if we go in without the label,
That’s how we got our start.” we can more easily bid for the large deals. In the case
33
of the government, it’s not even using set-asides with
CLevel | Spring 10
At the time, Obregon was laboring in finance at a the federal stimulus money, even though the law said
couple of companies in Atlanta, having also obtained her they would. So all in all, we’re just out there competing
advanced degree at GIT – two of them, actually: an MBA on a level playing field with anyone.”
with a focus on finance and an M.S. in Civil Engineering.
Competing. And winning.
