Based on several recent economic indicators, the U.S. should not expect to dip back into recession anytime within the next year. That's according to Larry V. Adam, managing director and chief investment strategist with Deutsche Bank Private Wealth Management. He was the guest luncheon speaking during this semester's Harlen Boyles CEO Lecture Series, held November 8.

Adam shared several economic statistics, both modern and historical, in outlining how he forsaw the national economy unfolding. He also discussed electoral benchmarks for President Barak Obama, and briefly touched on the Occupy Wall Street movement, during his 30-minute presentation. It's available as a mp3. [46.3 MB; 33:43] His slideshow is also available. [PDF]

He started his presentation by asking simply, is the economy in recession or are we in the midst of a rebound?

Very quickly, I don’t think that we are going to go into a recession over the next 12 months. I think we will continue along this path of what we call trend growth, and that means that the US economy will grow around 2 to 2-and-a-half percent. The reason we don’t think that we are going to go into a recession … if you look at the numbers that are coming out, the employment numbers, if you look at the retail sales numbers, you look at the manufacturing numbers, that are all consistent with this new growth structure, of around 2 to 2-and-a-half percent for the US economy.

In addition, you do not see the excess inventories out there that usually accompany a recession. Usually a recession is, you build up inventories; you go into a recession you have to work off the inventories.

Adams then related details of a recent trip to McDonalds, which he called "shocking." Upon placing his order he was told the restaurant was out of french fries. At 3 p.m. on a weekend. No fries. None were expected until Sunday. This was an example of everybody in business wanting to limit their inventories, said Adam. This is "across the board in almost every indutsry."

During the question and answer session, Adam was asked about proposals being outlined in Washington to help the middle class. He briefly mentioned the Occupy Wall Street movement, and went from there to the current difficulties in passing policies you want with no money to pay for them.

It’s a very difficult environment that we are in. The dichotomy between the haves and have-nots continues to get much more wider, if you will. It is a very difficult situation out there. Getting back to the housing market, obviously one of the things that continues to try and help out the middle class, as an example, is to do refinancing of their houses.

Am I in favor of that? I think that any type of meaningful turnaround in this economy has to involve the housing market, because that is the largest asset class for most consumers. So I think you do need to see types of policy that can help that, but you got to remember that right now this economy – it’s kind of like when you look over at Greece. It’s very difficult, given the fiscal dynamics in our economy, to really support a lot of those different policies people would want to get passed without making the budget deficit widen even further. So I think it’s very difficult to really take a lot of those plans into consideration. 

An established entrepreneur who retired in 2004 from the company he built, John H. Sykes is still hard at work. The philanthropist and Tampa business leader has a relatively new business venture, and he continues to promote the lessons he's learned in his more than 30 years of experience. Some of the lessons could be shared with Walker College students when he headlines the Fall 2011 Harlan Boyles CEO Lecture Series at Appalachian State, scheduled for November 8.

In late 2009 Sykes founded JHS Capital Advisors, an asset management company targeted at mid-level investors. It's built upon a foundation of strong ethics and integrity, according to a 2010 profile by Gulf Coast Business Review. 

The firm’s primary focus, he says, will be to serve all customers — not just those with higher net worth — in the best possible fashion, offering the best fund options.

Sykes adds that JHS Capital won’t promote its own branded investments: “We just don’t think that serves the best interests of our clients or gives them the broadest perspective.”

Although JHS Capital has a goal of 500 advisors in the next five years, Sykes emphasizes that brokers will be required to maintain strict in-house standards reflecting the firm’s integrity.

“We’re not going to take anybody just for the sake of growing revenues,” he says. “We want to be more of a qualitative-based company that always puts the customer first.”

Sykes has a history of success. In 1977 he founded Sykes Enterprises, which started as a "small technical engineering firm with three employees," in his native Charlotte. He moved the headquarters to Tampa, Fla. in 1993, and the company flourished, becoming a global leader in business process outsourcing.

Sykes Enterprises grew from $50 million in revenue in 1993 to $466 million in revenue in 2004, the year John Sykes retired and his son, Charles Sykes, was named president and CEO.

John Sykes was named to the Forbes 400 list of the wealthiest people in America after Sykes Enterprises went public in 1996, but he had barely retired when the itch to go back to work hit him. He had been working all his life, starting at the age of 6 when he pulled a red wagon door-to-door in Charlotte, selling flowers and Clovering salve.

“What I know how to do is work. I like to build things,” said Sykes, who turned 73 in July (2009). “I still had energy and the desire to do something.”

Sykes retired from Sykes Enterprises in 2004, but carries the title of chairman emeritus. He has received several awards from various community and business organizations, including Florida Entrepreneur of the Year, Innovator of the Year, the Tampa Police Department Citizen of the Year, the National Organization of Black Law Enforcement Officers Citizen of the Year, and Florida Free Enterpriser of the Year. The business school at the University of Tampa is named for him.

Sykes will be the 48th speaker in the long-running Boyles Lecture Series, organized by the Walker College of Business. Recent speakers have included Duke Endowment President Gene Cochrane, Duke Energy CEO Jim Rogers, Corning Cable Systems CEO Clark S. Kinlin, BB&T CEO Kelly King and Krispy Kreme Doughnuts CEO Jim Morgan.

He doesn't recall where he heard the statistic. Nor has he been able to verify it. But Gene Cochrane remembers once learning that the Internal Revenue Service approves a not-for-profit about "one out of every three minutes."

"Think about that, one out of every three minutes a new not-for-profit is being created," said Cochrane, president of The Duke Endowment. "The good side of that is that it’s given us capacity to meet need."

"The downside of that - It means we’re perpetuating a cottage industry where there’s a lot of fragamentation and often, in some of our large communities, an awful lot of competition among well meaning people, and competition for very limited resources, to run what they do," he said. 

Cochrane discussed some of the differences between for-profits and not-for-profits during his speech at the Harlen Boyles CEO Lecture Series held March 17 at Farthing Auditorium. Cochrane spoke for almost 40 minutes about his career, the mission of the Duke Endowment and the challenges of non-profits. He also posed questions ranging from, "is bigger really better?" and the difference between "innovation and impact."

Cochrane's speech is now online, as both video and a podcast. [MP3; 33.8MB; 36:55]

In contrasting for-profits with not-for-profits, Cochrane discussed the challenges the latter encounters when it comes time for a change in leadership, and maintaining infrastructure. 

The other dynamic that I see in non-profits which is somewhat different - often very different - from my days in the business world, is that there’s a very strong organizational pride about people that work with non-profits, and about the entity that is that non-profit. Often because it’s a first generation organization. Many of our non-profits, the founders are still around because so many of them have been created in the last 30 and 40 years.

And as you know from studying business, that transition from a founder to a larger corporation in a business, that ability to pass it on to another generation, or to other stockholders, is often made easier simply because you have capital stock to trade or to pass along.

But in a not-for-profit, you don’t have that. You have the presence of a founder and the pride they have in what they created and that is often a very difficult dynamic for them to deal with. ...

The third issue that we deal with a lot in non-profits is what I would call a sore lack of infrastructure. Thank goodness they are motivated this way, but if they get five dollars, four dollars and 50 cents of it they want to give away, or put into programs. And they’re very reticent to invest in their own operations. And so often we would go into non-for-profits and we see way lacking information systems, staff development, numbers of managerial staff, training of individuals, that we don’t see near to the degree on the corporate side.

So a lot of our work as a foundation is to try and beef up and to be sure that they have those kinds of resources.
 

On that theme - the work of the Endowment - Cochrane discussed helping non-profits better meet their goals, and grow not horizontally but vertically.

In a corporate environment often we will judge success by, are you able to replicate yourself? Can you satellite a new organization here? Can you franchise your idea?

The difference we often see in a service provider, really because you are working with the human condition more times than not, is that the scaling horizontally is more problematic than we would like. And so what we try to encourage not-for-profits to do is think about scaling, but scale vertically.

For example, if you’re really good at delivering a service, and you can prove that you’re good at service, maybe you’re better off at just doing more of that service on the same site or with the staff that you have. If you’re doing 100 of whatever the service is, let’s try to grow to 200 or 300, rather than moving horizontally to other communities. Which is a different mindset than we see often in other places.
 

While noting the differences, Cochrane stressed the goal of melding the skills of the for-profit business world with that of not-for-profits. He said Walker College has a role. 

I believe that we have a wonderful opportunity to bring the skills of business minds, of the skills that you’re learning at Walker, the experience you have of the alumni and friends of this school and other schools like this, and marry them with a sensitivity and the understanding of the community that not-for-profits have. I think that we would be much better served if we could find ways that we can get those two worlds closer together and in far more harmony with each other. And I think in doing so we will both be stronger, and we’ll have stronger communities, stronger businesses, and strong people.

Eugene “Gene” Cochrane Jr. '72 ECON, president of The Duke Endowment, will be the speaker at the spring Harlan E. Boyles Distinguished CEO Lecture. The lecture series is named for the late Harlan E. Boyles, who served for 24 years as N.C. state treasurer. The lecture and reception are open to the public. 

The event, sponsored by the Walker College of Business, will be held Thursday, March 17, at 2 p.m. in Farthing Auditorium on campus. A reception will follow at 3:15 p.m. at the Broyhill Inn and Conference Center.

Cochrane has served as president of the Charlotte-based private philanthropic foundation for six years.  Prior to being named president, he was director and executive vice president of the endowment’s health care division.

Cochrane worked as a hospital administrator for eight years prior to joining The Duke Endowment in 1980.

Cochrane is a member of the Healthcare Advisory Board of the Kate B. Reynolds Charitable Trust, the Board of Advisors of the McColl School of Business at Queens University, an elder at First Presbyterian Church Charlotte, and a member of the Board of Trustees of the Southeastern Council of Foundations. He participates in a number of local community and philanthropic organizations.

A Charlotte native, Cochrane is a graduate of Erskine College, Appalachian State University, and the Hospital Residency Program of Charlotte Memorial Hospital (now Carolinas Medical Center).

In May 2009, he received an honorary doctorate from the Medical University of South Carolina.