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Do record profits mean its a better economy?

2012-02-20T11:49:00.000-08:00

Living in rural Oregon, I hear people every day criticize commentators and the media about the so called Economic Recovery. We hear that unemployment is down, there are more jobs and the stock market is at four year highs. The markets are led by large companies who are continuing to post higher profits and then the commentators use these big numbers to tout a recovering economy.

Let’s walk through the reality of our economy. Unemployment being down is less about the number of jobs and more about the number of people leaving the unemployment rolls or the workforce. We hear very little about large companies rehiring employees; however we continue to hear about layoffs. Many times, large company layoffs are accompanied by termination benefits that delay qualification of unemployment benefits. Other scenarios are workers are offered positions at competing companies picking up the marginal slack begin created by companies reducing output of product or services. The bottom line is that Unemployment is not improving.

If unemployment is not down, how can there be more jobs. I’ve often wondered by what standard this statistic is being measured. There are more people coming out of college, who are not being employed, then ever before. Our high school and college students are finding it more difficult now to find part time employment, because more adults are taking the often student filled part time jobs. Construction at all levels is down, regardless of the government stimulus packages. Manufacturing at the core level, the small job shops that make up the majority of our manufacturing base, are all down. Where are the jobs?

Finally, let’s discuss profits. The news will have you believe that a skyrocketing stock market and the posting of record profits are a clear sign that the economy is changing. Let us begin with a simple lesson on profit management for public companies. Percentages are the basis by which many companies manage their bottom lines. My clients are all taught that their profit is an expense and it should be based on a percentage of their overall business. So, if a business wants to make 10% after all expenses, it will plan for this as if it were expenditure. Let us assume this percentage does not change, so as costs go up, so do their revenues. If this same company is a core industry or one that is very broad like Internet Service, Computer Companies or Food Items, the demand for its products could remain somewhat stable. If this company, was a 10 million dollar a year company and made 10% in 2008 and now in 2012 its costs were raised by 30% so it passed on those costs so it could still make 10%, its revenues would be roughly 13 million and its profits would increase from 1 million to 1.3 million.

It is not hard to add zero’s to the profit equation and see why large multi-billion dollar companies are posting record profits that sound amazing to the general public. With consolidation occurring in almost every industry, revenues are increasing, but anticipated gross profit percentages are still being held to post consolidated levels; higher dollars are being posted as profits.

Our economy is not getting better. The rise in costs coupled with the decline in employment is not on a path that is healthy for our economy. The influx of added government money, reduction in interest rates and manipulation of information are prolonging us reaching the bottom of this issue.

WHY THE MINIMUM WAGE SYSTEM WILL FAIL OUR ECONOMY

2011-09-27T21:08:00.000-07:00

In 2012 Oregon will increase the minimum wage from $8.50 to $8.80 and along with it, negatively affect the economy in Oregon for at least another year. Oregon will become the state with the second highest minimum wage in the country.

The primary wage earner in a family generally does not earn the minimum wage. The jobs that are paid minimum wage are far from menial, they include customer service jobs in restaurants, entertainment centers and gas stations. High school and college students, as well as moms with kids in school hold these jobs or people taking second jobs to support a family or lifestyle.

Oregon is one of only six states that do not offer a tip differential for employees earning tips as part of their compensation. There is also no available commission or piecework differential, such as might be seen with sales people or other customer support positions. This lack of adjustment is just one glaring issue that will further hurt the Oregon economy.

In looking at how the minimum wage affects small business, you need to understand the actual cost that goes into paying an employee in Oregon. The wage is only the visible aspect to the employee. Oregon has an unemployment insurance tax rate that can be 4% or more of the wage. In companies with many minimum wage employees such as students, employee turnover is typically higher and thus unemployment insurance rates may be higher. Additionally, seasonal businesses like hospitality and food service see their unemployment insurance rates on the higher side of the range.

Oregon also has the Workers Compensation Benefit Plan. This plan is in addition to the mandatory Workers Compensation Insurance carried by all businesses in Oregon. This State tax can be 2% or more of the employee’s wage. This amount is over and above the 2-10% for the actual Insurance.

The federal government has its Social Security and Medicare mandatory employer match that totals 7.65% of the wage. Additionally, there is the federal unemployment tax of just less than 1%.

For employees that earn tips as part of their compensation, the business is also charged the tax on all the tips earned by their employees. Generally employees claim the mandated 8% of sales as tips, so a business with $500,000 in revenue would have $40,000 in tips reported and the business would pay up to 15% or more of this amount in added taxes.

Finally, businesses in Oregon who wish to offer health insurance to its employees must pay a minimum of 50% of the employee’s health insurance premium. This requirement limits full time employment, rate of pay and benefit offerings in companies where such plans in other states are readily available.

The notion that raising the minimum wage will help the economy and plays an important part in the overall building of our economy is false. Generally, companies hit with large minimum wage increases; reduce hours, consolidate employee activities, reduce employee benefits or raise their own prices which contribute to the overall decline of our economy.

Because of this law, Oregon will continue to see slow economic recovery. Industries that have a high percentage of minimum wage employees are key economic industries such as Hotels, Restaurants, Gas Stations (Only Full Service In Oregon), Theaters, Convenience Stores, Agriculture and Piece/Commission jobs. If Gas Stations see their labor rates increase by 7-9% due to a minimum wage increase, gas prices will have to be raised.

The sad part about this increase is the compounding effect it has on everything else. When gas prices go up because of labor rates, you will not recover those increases. As fuel prices increase, so does the cost to deliver almost everything we purchase locally. That increase will affect the costs of raw materials and other items, which will be passed on to consumers. When this increase hits say a restaurant, whose labor is also affected by the wage increase, this business could see a 13-18% increase in Cost of Sales from this compound affect.

I’m not sure how anyone can see this as good for the long-term recovery of our economy. Yes, the minimum wage employees will earn 3.5% more in 2012. For that, the employer will see a 6-9% increase in costs imposed by state and federal laws on all employers. The employers will raise their prices from 5-9% and that will not only affect the minimum wage employees, but everyone.

Hiring in a deep labor pool

2011-09-10T10:40:00.000-07:00

The economy of the past few years has created a great number of obstacles for small business owners. As an advisor to owners and managers across the country, advice on sustaining the current situation grows more and more difficult, as that advice includes decisions that affect my clients and their employees quality of life. However, I believe that advice will pay dividends as our economy changes and begins to grow again in the future.

The current labor pool is deep. From laid off professionals, recently graduated college students and everyone in between and in the ditches. It is from this deep pool of human resources that I advise my clients to begin trolling for human capital that will help to solidify their business foundation and take advantage of the coming opportunities that are bound to be presented as this economy restarts.

Key areas that can be an investment are in customer service, operational efficiencies and product or service quality. The current economic downturn has not slowed the evolution of the consumer, who now uses social networking and other technologies to aid in their buying decisions. By shoring up your customer service, efficiencies, product and service qualities, you are putting your company in a position to stand out when consumers begin purchasing in greater quantities and more often.

The deep labor pool offer business owners and managers the opportunity to capitalize on experienced workers at a discount, providing a key investment opportunity to solidify the business when there is time to properly attack business issues that often get overlooked when business is busy and times are good.

The best way to begin looking at how to use the experience of others currently available is to review your current business plan, or if you don’t have one write one, today’s business climate means a business plan is something all small businesses should have. Once you have that plan in place, look for where your deficiencies are and look at how you can fix them using todays labor pool.

In a deep labor pool there are opportunities to “catch and release”. These experienced professionals and young new to the workforce educated people are often swimming through the labor pool, willing to help in any way possible, which in turn pays them and keeps their heads in the business game and ads to their experience. As you engage these workers and solutions are put into place, your company will benefit from the experience of people who normally may not be available to small business in a cost effective way.

Today labor pool will not remain full of readily available, lower cost experienced people. Now is the time when experience and planning will best fortify the foundation of businesses. Use the opportunity to find that experience and prepare your company for the coming recovery and gain the knowledge that will most assuredly become more costly and harder to find as the labor pool becomes shallow again in a booming economy.

Hold your Professional Service Organizations Accountable

2011-08-19T11:28:00.000-07:00

Small business struggles to post profits, but they are not alone. Professional Service Organizations like the Chamber Of Commerce, Better Business Bureau and others are feeling the squeeze on small business. The Chamber of Commerce and Better Business Bureau along with many others must invent new and unique services to keep their members happy so those members will maintain their status and the organizations can collect their fees; Our Advice is to make sure the services your getting meet or exceed your policy for profitable associations, in other words these organizations should help your bottom line in a way that’s measurable.

I am a firm believer in the Chamber, BBB, NFIB (National Federation of Independent Business) and many more. However, I am repeatedly surprised by the lack of quality and quantity of services some of these organizations bring to their members. I’m asked repeatedly by my clients; “How do I best maximize my membership in XYZ Organization?” My knee jerk answer is to get involved.

All of these organizations provide opportunities for its members to get involved in events that are free or are included in your membership fees. Make sure you understand what your membership includes and that you get involved. If your Organization touts events or perks, make sure you let them know you want to be involved. Also, it’s not too much to expect them to keep you informed of events, and not just events they want you to pay for.

Another way to get involved is to communicate with the Organization staff. Let them know what is going on in your business. Ask how you can get involved beyond any regular events and don’t let them blow you off. Too many times these Organizations become political or “clickish”. If you’re a paying member, and the Organization is using a favorite and you’re as qualified, make some noise and let them know you want and expect them to let you be involved.

Each business person should know what their business needs to be successful. From exposure, to operations to financial controls, business owners and managers face a myriad of challenges. These organizations are supposed to support your companies’ viability, so that means you should hold them to a higher standard. If the organizations you belong to are not helping you to become or remain profitable, move that investment to something that will help your business become more stable, grow or at least offer you an opportunity to gain some meaningful civic recognition.

Is ADD now TIADD, Technology Induced Attention Deficit Disorder?

2011-07-22T14:09:00.000-07:00

Society today, ‘Today’ being defined as the time from the late 1980’s to the present, has undergone a rapid evolution in information collection, manipulation, storage and presentation. With the introduction of personal computers, the internet, smart phones and more, the life has been transformed into an environment where information readily becomes available on demand.

Along with this technology, comes greater expectation. Initially, users were limited to certain types of data; internal business data and standard news information, enabling people to provide limited information to management and peers.

As technology has become a focal point of life for most of the developed world, cost has decreased as rapidly as innovation has progressed, making information more accessible and affordable than ever before..

With this reduced cost and more readily available access, new problems have come to light. Business and human process began to rely more on technology. People began to rely on technology to make decisions or mange decisions. In the past, it was only businesses that relied on technology to drive efficiencies, creating expectation previously achieved through people, process and time. Now, personal expectations have been raised, for every aspect of our lives. This fundamental change in expectation is the foundation for our assertion that ADD (Attention Deficit Disorder) has manifested itself in many aspects of our lives, both in and out of the workplace; our term for this is Technology Induced Attention Deficit Disorder or TIADD.

Twelve years ago we introduced TIADD to the business community as part of our methodology for resolving business efficiency issues in the workplace. In the late 1990’s, this disorder was manifesting itself regularly in the workplace, however throughout the early 2000’s, TIADD has begun to show up throughout society.

TIADD is a new foundation for inefficiency and vulnerability. An entire generation of worker is being trained to rely solely on technology to collect, analyze, process and distribute information. The inefficiencies are created through lack of planning and understanding of foundational business and personal process, as it relates to an organization or individual prior to technology implementation. Vulnerabilities are created when this technology is implemented with inefficiencies; people are psychologically affected by the negative impact of the technology. Additionally, the individual changes to business and personal process being used to circumvent technology based processes not properly learned, affect the overall performance of individual people, social groups and entire companies. These inefficiencies and vulnerabilities are the foundation for TIADD.

Physiology of the Problem

Since ADD has been determined to be a physiological disorder based on biological problems within the brain; it is important to clarify any physiological association to TIADD. Since, many people already have clinical ADD or ADHD, any condition caused by technology would only be a manifestation of their physiological issues. TIADD is a problem that is societal and caused solely by the introduction and reliance of technology in our current society. I do not begin to imply that TIADD is yet physiological or biological in nature; however I do believe that through evolution of technology and people, it may become a physiological issue.

Sociology of Problem

The sociology of TIADD is very clear. Society has become reliant on technology to streamline every facet of our life. People use technology to streamline communications, write letters analyze numbers. Mechanics utilize technology to diagnose cars, fix internal issues. Medical professionals use technology to quickly diagnose ailments and as reference tools to better understand case studies and application of remedy. Legal and banking professionals utilize technology to manipulate data and research trends or cases to quickly accomplish tasks that once took days, months or even years. And people use technology to forge relationships based on a new level of communication standard, one in which delay can affect the relationship both short and long term.

This change to the very fabric of business and life process has trained people to expect results, based on technology, in less and less time. If and often, when this technology fails to meet the individual, group or company expectations, impatience, distraction, impulsive requirements for information and results, hyper sensitivity to human interaction and a complete lack of social development within many social structures is causing a new uneasiness within society as a whole.

All of these symptoms are used to traditionally diagnose ADD, this onset of symptoms throughout society, is the basis for TIADD.

Technology Induced Attention Deficit Disorder has been established as a disorder, because of the use of psychology during the implementations of technology throughout the world. In analyzing issues related to business process failure, workplace lack of moral and the association to the implementation of technology, a correlation was noted between psychological issues in the workplace and these implementations. In addition, through the interview process of thousands of people, there was a common scenario; people were becoming more impatient and had less ability to function psychologically on problems that were once solved without technology. Additionally, apprehension and an inability to focus on problem solving or understand issues caused by behavior between people seemed to have a root in technology based changes.

These examples are based on issues with people that caused companies to consider technology enhancements, replacements or fixes; for business process and moral problems within their organization. The subjects used for this analysis are from all walks of life around the world.

Collection of Data

The collection of this data was governed by a structured data collection model known as BizVision, a very simple methodology, based on a series of questions, used to gain a high level understanding of the business process of people. The data also includes details about technology usage and individual interaction with other people. All of this data is compiled into a simple database for compilation and review. Models are designed, based on the process answers. Emotional and ability profiles were developed, to help determine the level of education at each position and the ability to teach new process or technologies.

It is during this part of the analysis that the psychological affects and abilities of each worker are reviewed again. We look at our data compilations and uncovered severe apprehension, lack of attention and inability to focus or change, as areas of concern. It is here that we saw TIADD manifest itself.

Our findings are simple and clear. As people have evolved with technology, their expectations for performance and ability to deal with human emotion caused by both personal and business process failures have changed. People have less ability to focus on problem solving, less ability to remain patient and less ability to accept people with less ability than themselves. These flaws and the ensuing result, lack of patience, lack of focus, emotional distress, work induced stress and human conflict at all levels point to TIADD.

People have been programmed into relying on technology to solve problems and solve them quickly. People do not want to offer patience or support to other people who cannot fix problems with the efficiencies expected in a technology based society. These expectations and lack of basic human qualities, once appreciated in society can now be defined as Technology Induced Attention Deficit Disorder.

Do you have BizVision? A Successful Management Style

2011-07-15T17:02:00.000-07:00

What exactly separates a successful organization manager from less successful peers? Success is generally planned and requires structure and organization. We believe success managers work in this way have Business Vision in their management style.

Today’s business environment is more competitive, has more sophisticated customers and a rapidly changing economic environment; maintaining or increasing a company’s performance is a managers most critical concern and managers who empower employees to higher levels, will make themselves and their employees indispensable to the organization.

There are some basic successful management qualities, uncovered by years of exhaustive management studies. These studies identify that successful managers are as different as they are similar. However, close observation determines that six particular qualities are generally found in all successful managers, these six qualities are:

· Being goal driven

· Employing good communication skills

· Continually empowering employees

· Acting with a caring attitude

· Embodying a caring attitude

· Manage with organization and structure

These qualities have become habits for indispensible managers.

Since habits are acquired behaviors, through training they can be adopted by anyone. While there is no magic success formula, a person’s desire coupled with an investment of time, energy and patience usually pays long term management dividends.

While one can say that stating six management qualities is simplistic, the successful manager invests much time and energy into the study of human nature, in particular to that of subordinates, superiors, customers and vendors. It is human nature to categorize needs into different levels of priority, understanding your level, as well as those of your peers is vital.

Andrew Maslow, a renowned behaviorist, brought this to the attention of the world with his famous “Hierarchy of Needs”. Maslow’s theories are based on the idea that people naturally attempt to satisfy lower needs before seeking to gratify higher levels of needs.

· First: Food and shelter

· Second: safety and security

· Third: belonging, friendship and love

· Fourth: self-esteem, status and ego

· Fifth: self-actualization and self-fulfillment

Understanding where you are in this hierarchy is useful in motivating yourself, then your employees to higher levels of performance. Your first step is to be aware of your own needs, giving clarity to your personal agenda, and then to those of your subordinates. The level at which they’re currently performing provides an understanding of their personal agendas, just as your performance mirrors yours.

Morale and High-Level Performance are not as connected as we may think. According to Fredrick Herzberg, a social scientist of the 50’s and 60’s, the most visible of the commonly accepted motivators; salary, working conditions and company policies are referred to as “hygiene factors”, meaning they are important for morale but have little relevance for high-level performance. They answer the needs of the first two priority levels but do not motivate the employee to higher levels.

Successful managers are also tuned into the most played radio station in business: WII-FM (What’s In It For Me). Performance measurement is a two-way street. Employees constantly measure their supervisors and their employer in the context of “What’s In It For Me?” Companies and managers who understand this and who tune in to answering WII-FM have more active listeners.

· Take the time to get to know your reporting staff, their values, personality type and what piques their interest and primary motives.

· Within the boundaries established by an employee’s Position or Task Guide, and in keeping with company policy, determine the best type of approach for each person.

· Standard policy does not mean we should ignore difference between people; a good manager always looks for an employee’s strengths and builds on those instead of exploiting weaknesses.

· The goal is to identify each employee’s personal goals and objectives and align them with those of the company; the result is greater organizational focus.

Success habits are something that can be learned by everyone. Indispensable managers know their own personal agenda, have an organizational system, develop successful habits that support their system and transfer all of this to their employees. Any behavior repeated regularly develops into a habit, and behavioral psychologists agree that this process takes only about 21 to 42 days.

As mentioned, there are six qualities basic to successful managers. Being Goal Driven means being results oriented; Aspirations, results and rewards are evident in all activities. Goal driven managers instinctively tune into Maslow’s hierarchical levels themselves and into everyone they set out to motivate; Goals are the prerequisite to achievement. An astute leader helps people set goals compatible to those of the organization and then provides the tools for achievement.

Communication means that everyone is informed. Imagine trying to use a system you don’t understand. High-level communication is required and this takes time, energy and creativity. The most power medium is your spoken word privately, to an employee. Your spoken one-on-one communication, followed up with supportive action, can show tremendous results. Banners, newsletters, and email are excellent support tools, but will be treated with quiet contempt if the personal touch and follow up are lacking. In partnership with Maslow’s hierarchy, rewards both communicate and symbolize some level of accomplishment towards the final objective.

Empower people. Have you ever noticed how certain people always make you feel good? They don’t shower you with false compliments, they’re not intent on telling you what you want to hear, but they possess a special quality that’s transferred and lifts your spirits. Behavioral experts refer to this as positive energy transference. Every manager needs to master this habit of transferring positive energy to others; this is empowerment. It brings out the best in others because it brings out the best in you, and it’s a habit that can be acquired by “dream building”. Everyone has a dream, including employees, whose dreams may be locked deep within their personal agendas. Indispensable managers uncover these dreams and build a bridge to the corporate mission; to be a successful manager, help people believe in themselves and recognize their talents, and then success can naturally follow. To achieve empowerment, try finding the employees dream, convert the dream into goals connected to the companies’ goals and break goals into daily activities. Also try building team belief through weekly or monthly meetings, hold the employees accountable for their goals and objectives as well as expecting them to believe and achieve while supporting them through your communications strategies.

There is an old saying about caring: “People don’t care how much you know until they know how much you care.” Caring is an extension of communication and empowerment, and it involves action and words. There are a number of ways to develop caring habits. Pick one day a year for each employee and do something that shows them appreciation, do not talk business – learn about the person, their family, their dreams and goals. Always follow through with everything you say. Understand the needs and wants of spouses and ask yourself if you really care and make sure you do. And finally remember that the little things mean a lot.

Being fully committed is required; none of the habits would be worth much if they weren’t coupled with total commitment. This is what provides dedication to one’s mission. The willingness to grow, to get personally involved, to invest time and money, and to be totally focused on performance is not taught in most business schools. These are life skills that the very best managers have developed and used in the conduct of their daily working relationships. Therefore, before any change occurs, total commitment, coupled with an action plan is a must.

S.M.A.R.T. management and effective task communication means identifying what is to be communicated, use the S.M.A.R.T. acronym to assign responsibility for completing assigned tasks within expected guidelines.

S – Specific (Clarity) People are not mind readers, be direct and specific when communicating by clearly spelling out what you want and what is expected and get confirmation by asking to have your question or statement repeated back to you.

M- Measurable (Objectivity) always put a yardstick to a task because if you can’t measure it you can’t control it; people naturally give more attention to activities which are measured.

A – Attainable (Clarity, Objectivity and Integrity) make sure that the person at the receiving end of the instructions is capable, trained, and has the proper tools to do the job.

R – Reasonable (Objectivity and Integrity) establish reasonable goals and get consensus, setting unrealistic targets alienates subordinates and becomes a root cause for undesirable outcomes like sacrificing quality, failing to complete tasks, jeopardizing safety and demoralizing the team.

T – Timely (Clarity and Integrity) install timelines and check on progress. Timelines must stipulate a beginning, middle milestone and an end. Review often to catch deviations from a plan and be fixed easily and inexpensively.

There is a simple successful management equation; Prosperity = Objectivity + Integrity + Clarity

Management success habits are not discriminating. Any willing manager can develop these qualities into habits; and over time they will become original to anyone who uses them, as every manager develops his or her own style and gains Business Vision. Start with you and as you develop into this conceptual manager, refine your systems to work naturally with your people and in turn they will transform into an indispensable team. Work S.M.A.R.T. and use clarity, objectivity and integrity in the way you manage and prosperity for you, your staff and the company will follow.

How the US Government is holding Small Business back and affecting communities

2011-07-13T16:54:00.000-07:00

The US economy has been extremely destructive to small businesses across the United States. Small businesses employ more people than any other sector of our economy. The government has given loans and help to large companies, without holding them to the same standards that most small business are held to.

Specifically for some of our clients, who have been hard hit and located in Southern Oregon, an area of the country with higher than national average unemployment and economic loss. These companies have lost hundreds of thousands of dollars between 2008 and now. During this time, our company and the business owners were not paid and in fact invested hundreds of thousands of dollars to keep the businesses viable and continue to employ almost 100 hundred people.

To make it through this time, our clients found themselves unable to pay the employee withholding taxes in full. However, these companies always filed and communicated thier position to the government each quarter. Each company had a payment history that showed progress through these tough times and how they prioritized their finances. The companies only paid wages and business critical expenses to keep the doors open which allowed them to continue to employ people, they paid all their obligations, albeit late.

We tried for over a year to get a formal payment agreement with the IRS for our clients, however the attitude of I.R.S. employees was one of disgust and uncaring for our clients or the employees. It took the IRS almost a year to get an agreement in place, and only after hiring a professional tax company to represent the firms, did the IRS allow a payment plan to be approved. Further, despite providing case law, IRS regulations and policy and backup information that showed these clients did not with malice or ill intent, not pay their taxes; the IRS has refused to abate penalties, with the final reason given in writing as; “A lack of funds does not amount to reasonable cause for failure to pay taxes”.

It is this inconsistency with regard to the law, IRS’s own rules and government policy that is currently holding many small businesses back. These companies are now in a position to not only get a loan to pay the tax and interest due the US Government, but also get one to make specific capital improvements and increase their business and employ more people. However, they cannot get the loan to do this without an abatement of the penalties.

It is disheartening to small business owners when they see our government give money to big companies and threaten to violate the same “Trust Fund Rules” by saying Social Security will go unpaid. Why would a government have a policy to ignore and punish those who are willing to fairly compensate the government through interest payments and investment in future business?

Our advice to clients is to refrain from growth without certain funding for all aspects of an expansion or new venture. The US Government has declared Small Business a target, with no apparent understanding of the way small business operates or affects the overall economic viability of our communities.

Developing Policy & Procedures; Progressive Discipline

2011-07-11T16:37:00.000-07:00

I am always amazed at the many different ways in which management is carried out within small and medium sized organizations. It’s not the fact that most of these companies do not rely on Policy & Procedure to develop a solid foundation for their organization; it’s the amount of emotion that managers bring into the management process.

Emotions in business almost immediately take away from the issue causing the emotion, especially in a disciplinary issue. The emotions range from anger and sadness to confusion and dismay; if there ever was a time to not show emotion, it is during the discipline of an employee in the workplace. In fact, discipline should be checked at the door for all business issues, so how can we learn about Policy & Procedures using discipline as the tool?

We teach that counter-productive behavior and using emotion or having reluctance or an inability to effectively and consistently deal with such behavior, is a serious problem for managers and owners. By not having an effective way to discipline employees, there is a good chance the organization has low morale and or reduced productivity within the ranks of the employees, which has a direct effect on the bottom line.

To effectively manage employees, managers and owners need policy and procedures, including one for discipline. Having such structure, gives the management team the tools needed to manage without emotion and gives the employees the “rules” by which they will always be judged and managed.

There are other reasons why owners and managers have such a hard time managing employees and why a policy or procedure should be implemented;

· Lack of discipline training

· Fear of consequences from employees

· Other managers or owners don’t manage

· Not enough time

· Feelings of guilt

· Loss of friendship

· Dislike of conflict

· Always wants to be the “nice guy”

Each of these reasons can effectively be set aside with a clear policy, so how do we develop one for discipline using an effective policy and procedure development method?

When developing a policy and procedure for dealing with employee discipline, it’s important to identify the counterproductive behavior most commonly seen in the workplace. Two of the most common are Absenteeism and Poor Work Quality, to which all companies should have standardized parameters established for employees to understand. Other counterproductive behaviors include;

· Accidents

· Inventory Shrinkage

· Office/Equipment Damages

· Gossip/Drama

· Rudeness with customers, vendors and peers

· Bringing family/outside issues into the workplace

There are many more issues that can contribute to counterproductive behavior, so many that it is impossible to prepare for each one specifically. However, by having a discipline policy in place, companies can effectively and positively establish control and manage in a consistent and positive manner.

The word discipline by itself implies a negative, which is why I feel any policy associated with discipline should include something positive; I like to call my discipline policy, Progressive Discipline.

Discipline can also be defined as “A constructive, positive force that enables people to work together clearly and objectively.” When employees first hear the word Progressive Discipline they always inevitably ask; “How can discipline be progressive or positive?”

Discipline is something that should correct counterproductive behavior and restore that employee to a state within the company that is productive, while deterring that employee from continuing with similar behavior.

When analyzing any disciplinary problem, we almost always find that no two situations are quite the same. Generally, such situations create stress and or uncertainty in how to proceed. However, having a Progressive Discipline procedure in place, gives comfort to management and staff during disciplinary issues. However in the real world, life and people tend to make even the simplest more complex and situational variables are infinite. Therefore, owners and managers must still be careful to investigate and consider all the facts before applying the discipline matrix developed for their company, to help do that the following key items should be considered;

· Seriousness of the issue

· Time Span of the issue

· Frequency of the issue; is it being repeated.

· Past incidences

· Work history of all parties

· Extenuating circumstances

· Are the policies and procedures governing the issue clearly defined

During the development stage of any disciplinary policy or procedure, it is very important owners and managers remember to keep them reasonable. It’s also important that the company makes sure all managers and employees understand the policy, that they pertain to the workplace and don’t restrict the lives of the managers and employees except for matters that might be serious enough to adversely affect the business or reputation of the business. Also, all policy and procedures must be consistently enforced.

Obviously, we have only given you a foundation to build on for implementing policy and procedures within your organizations. By sticking to the basics and using discipline as a guideline, you can develop clear and concise tools for management and employees to use in the workplace every day. There is a lot that goes into the development of any policy or procedure, but keeping in mind that all things in business should be positive, structured, consistent, clear and concise will help to establish the foundation needed to develop, regain or maintain operational control of the workplace.

Do you know your Supply Chain?

2011-07-01T12:30:00.000-07:00

Starting a small business is big step for most people, taking what you know or what you have saved and investing time and money into something you own. When we make the choice to be a small business owner, we like to believe that we are in control of our success, however there is a critical piece of the business that is often overlooked; the Supply Chain.

You don’t have to be a big company or sell fancy widgets to have a supply chain. Most small businesses rely on some other company or person for product or services critical to the delivery of their own product or service. As we begin to establish these vendor relationships, we typically allow them to tell us about how good their product or service is and sooner or later, choose a new business partner. This new vendor, can affect your ability to service your own customers, so the questions becomes; Will your supply chain fail your business?

There are a number of ways to help know your supply chain better. First, when a vendor asks you for your financials or to fill out an application, ask them to do the same. Your supply chains financial viability is just as important as your own and its fair for you to know that you can rely on your vendors to be responsible businesses and people who hold themselves to the same standards they are holding you to.

Second, get a basic understanding of your vendors supply chain. There is a limit to this but if your vendor relies on a third party to complete their responsibilities to your company, its fair to ask them to explain how that third party affects your relationship if that party fails to deliver.

Third, establish a clear line of communication between your company and your vendors, that details the terms of your business relationship and keep that line of communication open. Make it clear that you expect open communication and that you rely on them to meet or exceed their terms, just as they expect you to do when it comes time to order the services or pay for them.

Finally, do all you can to avoid allowing anyone in your supply chain to dictate your service or product quality. Establish your parameters before ever using the vendor and develop a way to objectively measure the performance of the relationship that can be shared with each vendor.

Your supply chain is your business partner. Knowing your vendors and setting up the relationship correctly from the start and maintaining that relationship based on the specification and terms agreed to, will minimize the possibility that your supply chain will fail you.

Understanding and managing workplace Drama

2011-06-27T09:58:00.000-07:00

Drama: a state, situation, or series of events involving interesting or intense conflict of forces…

Working around the world in a plethora of socio-economic environments and across all demographic categories has afforded me the opportunity to learn there are few constants around the world; but one thing that never seems to be lost at a workplace with more than one person is Drama.

Drama is the foundation of social communication in an environment filled with diverse individuals who make up the workplace. From Asia to Europe to the America’s, the commingling of receptionists, accounting clerks, sales people, managers, executives, owners, customers and vendors creates a melting pot of social diversity forced to commingle in confines that ultimately lead to drama.

Drama is the spark that creates interest in humans in the workplace. Most people don’t wake up and think; ‘I can’t wait to get to work and do my work’. There is something much deeper that drives us to return to work, beyond the paycheck and work, it’s the social interaction between people.

Drama does not have to be a negative in the workplace. Understanding the foundation of the drama within each particular environment is the first step to controlling the impact that drama has on the overall environment, and since you cannot eliminate all drama, you should work to understand it.

The first things that help us to understand and manage drama is creating an environment where the company remains the number one priority. To do this, it is critical to establish operational controls from day one. Control in the workplace is established by employing clear and concise policy and procedures and maintaining clear workplace communications with regard to the work and objectives of the company.

Once management has established that it has established a clear understanding of what is expected by each employee and provided all employees with the tools and information needed to be professional and successful, we can begin to focus on the social drama that swirls in the office.

Knowing that drama transcends all levels of the workplace, management should not get involved in any drama between employees that does not interrupt the goals of the company. Understanding that people need social interaction to remain interested in the environments they spend time in, managers only need to focus on the company’s productivity. Additionally, managers need to objectively understand that their own social interactions (drama) will be viewed by subordinates and that it should be held to the same standard as the rest of the company.

Negative drama is one thing that requires immediate attention. This interaction draws the manager into the drama, but offers the opportunity to highlight the importance of policy and procedure and can be a great learning opportunity for all parties involved. If drama is causing the company negative feedback or a reduction of efficiency or even a loss of revenue, the parties must be addressed in a proactive, positive manner consistent with the overall policy, procedure and objectives of the company.

Regardless of your work environment or position within a company, you will be faced with drama in your workplace. Understanding that each person is driven by unique and different motivations and requires different levels of attention, support and guidance, will help anyone to control the affects drama has on their particular environment.

Four Sides to Every Story; An Objective Managers Foundation

2011-06-17T16:55:00.000-07:00

In Objective Management, there are four sides to every story.

Being a manager in a small or medium sized business can be quite stressful at times. There is your primary responsibility to further the business you work in, by applying your experience along with the policy and procedures to whatever it is your area of responsibility is. Most times, we have learned through working with thousands of businesses and tens of thousands of managers and employees, there is a definitive lack of Policy and Procedure supporting the experience.

Without Policy and Procedure, the individual must rely on his or her own organizational skills and or memory to remember the different tasks and company standards that may or may not have been established. It is during this time, day to day, that you begin to see the chink in the armor of personal memory as it pertains to remembering the day to day things that are needed or that have even happened during the day.

The human memory is not something that is consistent between different people. Each of us has a different way of remembering things and applies our own learned way of storing that information. Then, when it comes to remembering that information, we fall back on our own way of “telling the story” to whomever wants to hear it.

We believe one of the first steps to Objective Management, is realizing that there are four sides to every story.

1. There is the side of the first participant.

2. There is the side of the person telling the story.

3. There is that which you believe.

4. There is the truth.

Now, we concede that all four can be the same, however history tells us that stories change each time they are told or each time we hear them. We have all gone through or heard of the grade school exercise where a story is told to one person and asked to pass it around the class; only to find that at the end of the line the story has changed, sometimes drastically.

It is the ability of a Manager to listen to all the information being presented to him or her and discern from the details the key ingredients needed to piece together what the issue at hand really is. With so many things affecting today’s managers, employees, vendors and customers it’s no wonder the stress level in the work place is at an all time high. By listening and realizing there are four sides to the story, you can give yourself the information needed to resolve any issue presented in a fair and equitable manner.

Four sides to every story is part of our BizVision Management program, one tool offered by www.yourbizdr.com

Trade Rags, A Way To Educate Yourself

2011-06-10T12:18:00.000-07:00

We are constantly asked how we keep up with all the different industries that we provide advice to on a daily basis. Early in my career I would explain in not so simple terms how my personal experience in leading an International Consulting company has expanded my depth of knowledge and allowed us to expand our area of influence over small and medium businesses. Then, one day it hit me, the foundation of our knowledge was our policy to subscribe to every Trade Magazine, Publication and Website for every industry we represent; we are addicted to Trade Rags.

It’s not that we rely on Trade Rags to supply us with the answers to questions and issues facing our clients. No, as objective consultants in a wide variety of industries located throughout Urban and Rural America, Asia, Australia and Europe, we needed a solid foundation of understanding of each market, and Trade Rags give us a multi-dimensional view of those markets. Trade Rags also give us the 100,000 foot view with snippets of the drill down details needed to understand specific issues the market faces from local, regional and national economies to individual regulatory and business indicators such as labor, manufacturing, sales, marketing and operational management.

We find that many times our clients subscribe to Trade Rags and then skim over the magazine looking for the Headlines. However, as any good consultant should do, we drill down into the stories, ads and editorials looking for those pieces of information that can help our clients in their specific area of interest.

Owners, Managers and Employees wanting to progress within their industry and consultants to those people should subscribe to as many Trade Rags as they can within all areas of influence they participate in. Understanding what is going on is not a one dimensional exercise. Trade Rags can be a conduit to Objectivity in that reading them expands the readers knowledge and provides additional learning and viewpoints that can be used in future planning and decisions.

Trade Rags are and will continue to be a source of foundational and operational information for most business people. The time and resources needed to procure, read and digest the information contained in the Trade Rags is an investment in every business person’s company and individual future.

What is a BizDr?

2011-06-03T17:34:00.000-07:00

After more than twenty years of helping clients around the world and experiencing a multitude of cultures along with making friends on all the worlds continents, technology has finally evolved to a point where I can share my experience without leaving my family. YourBizDr.Com has been designed to incorporate all that we have learned and developed over the past twenty plus years, into a single website that gives flexibility and efficiency to business owners, managers and employees twenty four hours a day, three hundred and sixty-five days a year.

As we begin this new journey, we will be sharing our experience, both successful and unsuccessful in an effort to bring objective business consulting to as many business people we can reach. YourBizDr builds on our long standing belief that business is built by an integration of; People, Process and Technology. And that by applying an objective approach of organization through procedures, policy and common sense, businesses can be successful and rewarding for everyone.

As we begin to share our insight and experience, we hope to provide information and support to all who seek it. Our Blogs, Twitter and Social Medial efforts aim to provide basic yet effective tools to those who wish to learn without joining our member based programs. Our YourBizDr.com site and use of tools like our proprietary BizVision Management System and large library of business policy, procedures and documents, will surely be a vast resource to those who wish to engage us for our knowledge and objective guidance.

A BizDr is not just a single event support person, location or web page. A BizDr offers those who seek business guidance, access to Management Consultants, Marketing Consultants, Human Resource Consultants, Accounting Consultants, IT Consultants, Graphic Designers, Business Tools, Business Support Sites and a community of business people where business issues and ideas can be shared with peers and experts in a confidential and secure place.

We look forward to bringing a new age in consulting to the Internet and sharing through this Blog experiences, stories and information that will benefit business people around the world.