Tag: Business Management

What Fans & Groupies Mean to Your Organization

A few weeks ago I saw one of my favorite bands, Guster, in concert.  Guster is an alternative rock band (known for using bongos instead of drums) – I’ve seen them live three times now and own all of their cd’s.  Needless to say, I’m a fan.  But I’m not just a fan who likes to listen to their music; I’m kind of a groupie.  I’ve followed the band from the beginning and I’ve enjoyed, respected and defended every piece of music they’ve created.  They’ve evolved as artists and have gotten quite a bit of flack from ex-fans because of it, but I respect their growth and everything they’ve done has really resonated with me.

People aren’t just fans of singers and bands, though.  They’re fans of stores, facebook pages, brands, designers, companies, products, political leaders – you name it, someone has probably said, “I’m a fan of that.”  In fact, the term is used so loosely these days that it may become obsolete.  But as fandom dwindles in importance, groupies become more revered.  It’s not enough to just be a fan.  In the music world, a fan is someone who illegally downloads songs, goes to an occasional concert, and knows, from the entire discography, only a handful of songs.  These are people not truly dedicated – they have outside interests and loyalties and can sometimes jump ship if they no longer agree with the object of their fandom.

If we establish fans and groupies in so many other aspects of our lives, I started wondering if we are proactively seeking out fans and groupies in our employees.  Management and HR strive to keep their people motivated and engaged in their jobs and the company.  Do we differentiate between fans and groupies in the office?

Fans are great employees.  They meet and exceed expectations on a regular basis and are excited to be a part of the company.  Groupies are better.   As in the music-world, they go above and beyond every single day to live their passion for the company and it’s mission.  Groupies will work late and on the weekends without being asked, will enthusiastically contribute to all discussions and won’t fudge their expense reports.  Most importantly, a groupie BELIEVES and is dedicated to the overall growth and intent of the company – they drink the kool-aid (see #2).  Fans, on the other hand, will tote the “company line” and may go through periods of disenfranchisement.  This isn’t necessarily a bad thing and I think for many people there are times when they’re a groupie and other times when they’re a fan.  It’s an ebb and flow, cyclical process. But from the company’s perspective, it’s about catching their employees at varying points of the cyclical process.

Companies should cultivate their groupies into positions of leadership, encouraging them to infect colleagues with their energy and enthusiasm.  Companies should also have open channels of communication with their fans, discerning what is stopping them from being a froth-at-the-mouth, wake up at 4 am to do work every day, talk about it at a cocktail party, groupie.  For that matter, they should also have these discussions with groupies, “why are you so crazy about our company?”  These conversations can enlighten all parties into how employees can be more efficient and motivated in their day-to-day jobs and how management can build a more energetic corporate culture, more compelling products and services, and a stronger long-term growth strategy.

So, who are your fans?  Who are your groupies?

Fueling Small Business Growth with Aligned Compensation

The natural dilemma of every small business is investing in growth ahead of realizing profitable and positive cash flow results.  It’s a constant push/pull realizing you need more resources – product, plant capacity, people, etc. – to deliver growth you have confidence will materialize, but don’t have the capital to invest.

Maybe there is a creative solution on the people side of the ledger.  These are tough times and the market is ripe with great people looking for work and a chance to prove out their worth.  Small businesses need great people resources and “can’t afford” the investment.

Consider an incentive laden “hiring” approach that is directly tied to “money coming in” for the firm:

  • Offer low to no wages.  Definition of relationship as contractor or employee with benefits depends on the ability and willingness to pay wages
  • Provide benefits as incentive to “hire” commensurate with lower wage scale
  • New business has associated Gross Margin attributes after Cost of Goods Sold (COGS).  Include in COGS a fee for marketing, sales, development talent for these people who can directly drive these new customers or new revenue growth.
  • The approach requires analysis to ensure that this new growth adds incremental margin that does not disrupt any current SG&A requirements or cash flow
  • Overpay market for the risk taken on by these individuals and you may find them hungry to deliver for future employment rewards and direct alignment of compensation with success for your business

This solution certainly is not for everyone, on the employer or individual side.  However, there are times when it’s an alignment of needs where this approach can be mutually beneficial.

Ounce of HR prevention worth pound of legal cure

A quote known to all of us, “an ounce of prevention is worth a pound of cure,” manifests itself daily in routine parts of our lives.  In business, there are clearly times when practicing this “rule” can have enormous impacts on eliminating costs.

This is certainly true in the area of managing HR practices.

Good Human Resource practices simply prevent problems with employees and avoid other costs.  How often could better safety awareness procedures in the plant have prevented an accident or proper firing process eliminated a wrongful termination suit or better hiring practices prevented a hiring mistake or …?

Finding ways to manage HR inexpensively, but effectively, will control costs and create a better work environment.  Not following the changing compliance rules and regulations in HR can also cause issues.  The ounce of cure resolving HR issues often results in unnecessary legal costs.  The current national average for an hour of legal counsel is $284.  And legal costs are on the rise.  71% of US law firms increased rates in the poor economy of 2008 with some reaching $1,200 per hour.

How can better prevention practices in HR eliminate these costs, especially in small to medium size businesses where having an HR practitioner on staff can be a luxury or a single person in charge of the function can’t keep up with changing regulations?  There are means to satisfy this need, and inexpensively.  Check out www.hrinsights.com where for an annual membership fee of $485, a business can have access to up to date forms and an ability to check on best HR practices real time with expert advisors.  Potential legal fees saved are worth the cost of prevention.

More often attributable to Benjamin Franklin, the famous quote is traced back to the early 13th Century.  Henry de Bracton was a famous English jurist and author of De Legibus et Consuetudinibus Angliae (On the Laws and Customs of England).  His influences on law are considerable.

It smells like…

The smell of fresh cut grass reminds me of football. Every time I smell it, I immediately have fond memories of my youth: running, sweating, hitting, and learning about hard work, discipline, and team play. You might know that there is a whole science that studies this tie between the sense of smell and memory and this type of memory is often referred to as a “Proustian Memory”. It’s named after Marcel Proust, the novelist. He describes this phenomenon, spurred by madeline cake and tea, in the opening chapter of Swan’s Way, the first novel in his work, Remembrance of Things Past.

So the other day, I was walking the neighborhood and due to the circumstances explained above had my recurring Proustian Memory.  And it got me thinking are there other smells that provoke clear memories for me? I realized that there are plenty of “smells” that have provoked certain memories throughout my business career.

  • The smell of a poorly performing employee and the memory that I thought they would get better
  • The smell of a difficult, slow paying customer and the memory that I thought we could work things out
  • The smell of a not quite perfect job candidate and the memory that we hired them because we needed to fill the seat.

There are plenty more of these Proustian-like Memories throughout my career both good and bad. Oh, by the way, the complete memory for each of these scenarios is that I was completely wrong. The poor performer didn’t get better. The difficult customer got worse. And you should never fill a job just to fill it.

Unlike my football memory, those cited above are not fond. Sniff through your business. The smells of today will bring back the memories of yesterday. While you can’t change the past, you can learn from it and change the future.  What Proustian Memories do you have?

It takes 10 years to be an overnight success….

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@OfficeDivvy tweeted over the weekend announcing their latest blog post, Overnight Success Does Exist!…Not! David Heinemeier Hansson, a partner at 37signals, was speaking at Stanford’s Technology Venture Program about the fact that it took  37signals 10 years to become an “overnight success”. He believes that “accelerated growth is a charade” (his statement is a reaction to vc’s expectation that cash creates accelerated growth) and that it takes time to develop a sustainable, profitable company. Some have called this a defeatist attitude. Far from it. I can’t tell you how many business plans I have seen (actually wrote a couple) that portend huge revenue and profit in a 3-5 year timeframe. These plans are written by aggressive, optimistic and rational people. They are based on well-informed assumptions. They just aren’t very realistic. So what are the critical activities that have to be executed in order to build a sustainable, profitable company (assuming you have a real product and market):

  • Have a core team that is committed to success
  • Add to the core with the best people you can find…Don’t settle
  • Communicate well (both within the core team as well as the company)
  • Sell…Everyday
  • Understand your key success metrics and watch them
  • Manage your cash
  • Maintain a sense of urgency but don’t freak out
  • Take some risks, try new things (ie marketing, new products)
  • Celebrate success…Understand failures
  • Remember the Fundamentals
  • USE THE WEB
  • Establish a solid infrastructure for hiring, managing, paying and, when necessary, terminating your employees

Building a sustainable company is really hard. I am personally on a mission to do this right now. This is my list…What am I missing?

Image: zazzle.com

Shock Therapy: Focus on the Fundamentals

Have you ever seen the Fox reality show, Kitchen Nightmares? I love this show because it is a dramatic example of the highs and lows of running a small business.

In Kitchen NightmaresGordon Ramsay, a world-renowned chef and restaurateur, uses his culinary skills, business experience, and irreverent approach to put struggling restaurants back on track. Mr. Ramsay is tough. He screams, swears and insults to get his point across. I thinking he’s pretty entertaining (what’s better entertainment than uncomfortable). But putting the histrionics aside, Ramsay delivers a solid message every week: You can’t lose site of the fundamentals.

Chef-Gordon-Ramsay

Whether due to inexperience, arrogance, or lack of focus, these business owners are not executing the basics. Unfortunately, this happens all the time and, as business owners, we have to take an occasional step back and look at the big picture. Ramsay forces the issue in the show. He assess:

  • The marketplace. What is the demographic of the area? What is the competition doing? He walks the streets exploring other eateries in the area: types of food, prices, and quality. Most of his clients are out of synch with the market.
  • The product quality. First step, he eats the food. Often, it’s crap.
  • The service. He evaluates a dinner service to determine the team’s proficiency. Many of the restaurants can’t get the food delivered in a reasonable time.
  • The people. Demoralized employees that have lost their passion for creating a quality product or delivering an outstanding service plague these businesses.

By failing to execute on these basic elements, it’s not hard to see why these businesses are in trouble. Are you regularly assessing the big picture? Are you keeping your eye on the fundamentals? In fact, it wouldn’t hurt to have a smart outsider help you with a periodic assessment like Ramsay does. And if you do: Don’t be too proud. Don’t be defensive. Because if your “advisor” is anything like Ramsay, you could be in store for a little shock therapy.

The Latest Changes @ HRI

Last Wednesday, we pushed the latest changes to the always improving HRInsights. The driving force behind our work is to provide businesses with a simple, low cost but robust tool to get HR work done. Whether a business owner wants to be proactive in establishing a core HR infrastructure or deal with a problem, we provide multiple easy ways to get it done. So, as we make changes, we are particularly concerned that we remain uncluttered, simple yet impactful. The latest changes are focused on providing more transparency to the subjects and dialog that is going on throughout the site. There is a healthy discussion of not only Human Resource issues but business topics, as well, and these items can be very helpful to any business. Our Community, which is a free forum, is continuing to grow with both business people and HR folks sharing opinions, anecdotes, and breaking news items. We’d love for you to come in and share your experiences and expertise. Expect more improvements to come…You can check us out @ www.hrinsights.com.

Pick Up The Phone Already! When Email & Texting Backfires

I read an article in the Chicago Tribune this AM about how digital communication (texting) is dominating voice communication. With two teenage girls, this revelation wasn’t too surprising and it got me thinking about how we communicate in the business world. While I have worked most of my career in technology-oriented businesses and love the benefits innovations in tech provide, there are some things about this overwhelming move to digital communication that bug me.

The first offenders are the people who use email and texting for “emotionally charged” communication. If the communication is personal in nature (ie a disagreement, disappointment, anger, performance issues, etc), an email message or text is just wrong. If you can’t meet with the individual in-person, use video chat or a phone call to share your feelings. There have been too many times in my career when I have received an email and can’t fathom why the author didn’t pick up the phone or come to my office. Well, I guess I can fathom it. Most of us don’t enjoy confrontation or uncomfortable discussions and believe that an email is an easier way to go. Not so much. In the end, it almost always comes down to a confrontation anyway.

Take this recent example, How Not To Handle A Resignation Gracefully from TechCrunch that I tweeted yesterday AM. An employee resigns via email and a boss responds negatively, also by email. Let the paper trail begin. While it is appropriate to put a resignation in writing, the right approach is to schedule a discussion with the boss at the time of delivering notice. It’s not too hard to believe that the boss, Jason Calacanis of Mahalo, responded to unprofessionalism with even more unprofessionalism. It’s not pretty. But here’s the reality, when sending emotional emails and texts, you can almost guarantee these notes will be forwarded to others, extending the damage – an outcome that is practically obsolete when you pick up the phone or step into someone’s office instead. In this case, it’s all over the web.

As an update to the drama and an explanation, if not an apology for his actions, Calacanis said in a blog this morning, “no one is perfect” and sometimes “I say something brutally honest without regard to my reputation or the other person’s feelings. There’s no reason to make the kid feel bad on the way out when I could have just said ‘Good luck, we will miss you greatly!’” He also included a great list of pointers on “How to Resign” that everyone thinking about texting their boss about a new job offer should definitely read closely.

It Takes Guts!

I almost choked on my Jambalaya dinner when New Orleans coach Sean Payton made the call to go for it on 4th down in the 2nd quarter of the Super Bowl.  I jumped and exclaimed, “WOW, that takes guts!”  I thought he was crazy.  And then, Payton opened up the 2nd half with an on-side kick!  It was confirmed, he is crazy…but I quickly realized he had come to the Super Bowl to win.

Do you have a work environment that encourages people to demonstrate courage?  Do you exhibit courage in your own job?  I am not just talking about the HR person.  This is meant for the entire management team, straight up to the top.  Here are a few acts of courage that don’t require anything but guts!

  • Speak up at meetings when you don’t understand what was being said?  It takes guts!
  • Tell your boss (respectfully) that you disagree and why?  It takes guts!
  • Ask your employees what they like and dislike about their jobs or work environment AND listen?  It takes guts!
  • Be honest when communicating with employees and don’t distance yourself from the company if you have to deliver bad news – you are “management”.  It takes guts!
  • Offer suggestions instead of complaining?  It takes guts!

We can choose to sit and play the same game plan over and over, every day, OR we can do something out of the ordinary, something different, something spectacular…it just takes guts!

Equality!

Last week, a technician came to the house to fix some problems we were having with our ATT U-verse service. My mother-in-law met the tech and he made a nice comment about our home and asked what her son-in-law did for a living to have such a nice house. She responded kindly, but why automatically ask about the guy’s profession? The son-in-law is an entrepreneur who would gladly work for nothing to follow a big idea. The daughter is an accomplished executive. As we enter 2010, it is still baffling to me that the technician wouldn’t have considered the female of the house as a major breadwinner.  I understand that strides have been made but we haven’t come far enough. Women are still the co-signer, co-applicant, and secondary account holder. My daughter will be attending a summer camp and we were filling out the application the other day. As my wife filled it out, they asked to place the husband’s name first in providing contact info for the parents. Why? Of course, women are still struggling to be considered equally to men in the workplace. In today’s paper, it was noted that no women reside on the writing staffs of Leno, Letterman or O’Brien.  Really? One of the funniest people around today is Tina Fey.  Are there no funny female writers in the market or is there something else going on? Too many businesses are still dominated by a bunch of white guys. As a business owner or manager, do yourself and your business right by extending your job searches to include a good mix of individuals. You’ll do well by adding a “woman’s touch”.