Getting the Workforce to Work Together

Basic Business Cents

Nothing is as destructive to an organization as employees working at self-interests. We are taught that everyone is doing their best but that best might not be for the good of the system. They want to do the best for the organization but dissention and competition within the workforce can cause them to focus efforts on themselves. A collaborative workforce is much more productive than a collection of individuals that may be working at cross-purposes. This is where leadership differentiates itself from management.

Leaders first establish a vision of the desired future of the organization. This vision needs to be memorable, inspirational, and compelling. Then the people need to be involved in the definition of the strategic steps needed to achieve the vision. If they are involved, they will have ownership; it will bind the workforce together in the pursuit of that vision.

In order to build teamwork and esprit-de-corps, leaders need to:

·      Model the behavior that they desire because the workers are always watching and they will emulate behavior.

·      Understand the needs and interests of the workforce and help them satisfy those needs.

·      Think long-term and act for the betterment of the entire system.

·      Communicate progress on the achievement of the strategic actions on a regular basis to keep interest, enthusiasm, and positive thinking on the effort.

·      Lead, not dictate. Neither should they abdicate responsibility.

Everyone needs to work on establishing cooperative relationships but it starts with the leader. Competition within the workforce can be very destructive; it promotes win-lose situations. What are desired are win-win activities and results. All need to remind themselves of fixing the problem and not the blame. They need to develop a mutual trust and respect for each other. They need to exchange ideas and help each other. One-on-one meetings often can solve misunderstandings. Leaders can initiate the improvement in relationships within the workforce by replacing individual rewards with rewards for everyone. They can empower and enable others to act and invent options for mutual gain.

Lastly, leaders need to nurture self-esteem of the workers by promoting the understanding that everyone is important. Positive reinforcement should be used often and sincerely.

The workforce should have an input in planning and creating new ideas. People should be given important work and then discretion in getting it done. Micromanaging or constantly looking over workers shoulders inhibits creativity and slows down the work. Visibility should be given on progress and results. Leaders and workers alike need to remember Stephen Covey’s advice that if we want to be trusted, we need to be trustworthy. We must also trust others, and remember they are always watching our behavior.

By involving the workforce in the planning and getting their buy-in to achieve the organization’s goals, developing cooperative behavior throughout the organization, and elevating the self-esteem of the workforce, the old adage the whole is greater than the sum of the parts can be proved in your organization.

Life Balance

Basic Business Cents

We are accustomed to taking inventory of our stock at work and looking at our bank balance, but do we an audit of our life, as we should? We tend to get stuck in routines and focus on the urgent activities at the moment and not what is important long term. An audit of the balance in our lives can be divided into three categories-satisfaction, provisioning, and growth.

Do we have pride in both what we are doing in our work life as well as our home life? Do we achieve a sense of accomplishment in both? Are we achieving recognition for our accomplishments for our selves and our family members? Are we happy and finding enjoyment? Your life should be so exciting that you cannot wait to get to work in the morning and cannot wait to get home in the evening.

Do we experience fear or anxiety at work or at home? Dr. W. Edwards Deming used to differentiate between fear and anxiety; he said fear is caused by external factors for which we have no control, like war, weather phenomena, and fire. He said people cause anxiety; and we may be able to do something about that.

Most of us need to work to provide income for living needs and for our retirement; but there are other elements of provisioning. We need to provide love and respect for our family members, co-workers, neighbors, and fellow citizens. We need to contribute to our community and to various organizations of which we belong. A good idea is to identify long-term goals for our life. The average life expectancy in the United States today is about 79 years, which gives us about 50 years to achieve what we desire to become at the peak of our work life and personal achievement. We need to ask ourselves in this assessment if we are on the road to our ultimate aim, and if not, get back on the right track to make it happen in the needed timeframe.

The third category of life balance is growth. Are we learning at the rate needed to reach our aim in life, both formal and informal? Are we getting the needed experience? Are there other parts of our aim to consider like spiritual growth, personal development, family achievements, and a list of sights and experiences to consider?

When interviewing job applicants, it is a good idea to ask them what their long-term goal is in life. If the current position does not help them get to their goal, don’t hire them. They will only end up being unhappy and less than desired employees. Plus, you will have done them a service to think about what they really want in their next position.

It is necessary to discuss your aim with your spouse or significant other to ensure that you have the same goal. You may find that by this discussion that you have to rethink your aim to make sure that you really do have balance between your career and family. Changes may be required in your aim, or in your action. The real value in the assessment of your work and family lives is the thought process of determining what you really want and need, and then getting on the path to achieve it.

What is Marketing, Anyway?

Basic Business Cents

The dictionary defines marketing as the action or business of promoting and selling products or services. Too many people believe that if they design a better mousetrap or put up a web site, customers will beat down their door for the honor of obtaining their product or service. It isn’t usually that way in the real world. It is necessary to market the product or service in a way to entice the customer to buy.

There are many components of marketing and the judicial use of which to use, when, and where are critical to long-term success.

Market Research gathers information about customers’ needs and preferences, which are not always the same. Sometimes the customers do not really understand what their true needs are and good market research may have to dig deep enough to discover it. The customer’s goal is to be very pleased with the benefits of doing business with you and you have to ensure that your product or service fits that need or preference. Market research should find the best way to reach that customer to make the sale.

Sales are the actual actions of exchanging your commodity for money. It can be in a store, face-to-face at the customer’s site, direct mail, on the Internet, at a convention, or on the telephone. Until you make that sale, you have no income to finance your activities. Sales professionals are fond of saying that nothing starts until a sale is made.

Promotion is defined as the publication of a product, service, or organization to increase sales and public awareness. It can take the form of advertising in various forms of media, radio, television, newspapers, magazines, trade papers, public spaces, vehicles, billboards, etc. The first rule of thumb in advertising, as in all other promotional vehicles, is to speak of benefits to the user and not of features of the product or service. This is difficult for inventors and engineers as they are in love with their product or service. Press Releases can be useful as an alternative or supplement to advertising and it is free, but it must be truly newsworthy or the media will not use it. Word-of-Mouth from delighted customers is the best form of promotion but it has to be earned. Electronic Word-of-Mouth is emerging as important and is facilitated through various social media forms. It can be expedited by placement of promotional pieces on selected outlets. Direct Mail is an avenue to reach customers, which can either be my postal services or electronic.  Build and use your Network; it may be your most important asset.

Collateral is the printed form of customer benefits of your product or service. It can by flyers distributed by mail, display rack cards, brochures, catalogs, hand-outs, manuals, books, and other material supporting the promotion of your products or services. Testimonials, especially unsolicited testimonials, and case studies are very useful as prospective buyers look for references.

Not to be forgotten, After-Sales Activities are a very important element of marketing. Service and follow-up to ensure satisfaction, or better yet delight, with the product or service by the customers are critical.

Good market research and a market plan will reveal which of these activities best fit your product, service, target market, capabilities, and abilities to produce. The Market Plan will detail not only which, but when and where to use these activities.

Developing Your Marketing Strategy

Basic Business Cents

A fundamental question for any business is, “Do you sell what you can make or do you make what you can sell?” The answer might surprise you unless you carefully develop a marketing strategy. The first step is to conduct some market research.

Study the demographics of who will use your output, consumers, resellers, age group, industry, etc. How large is the market, is it growing or declining, location of buyers, purchasing habits, and best sales channels are questions to explore. What is your appeal to this market?

The next step is to identify your target market. From my experience, if you say your market is so large that if you only get 1% of the market you can become rich, you will likely get lost in the crowd and not succeed. But if you narrow the niche or segment of the market to not only become a major player in that niche, but to dominate it, then you have a good chance to be successful. Consider how well your product/service fills unmet needs or wants, how well the niche fits your business vision and skills, cost of entry into that business, and competitive positions. This is really defining a favorable opportunity.

Now that you have identified your target niche, do an analysis of the competition you expect to face in that segment of the market. Develop a worksheet listing the competitors, their strengths and weaknesses, pricing strategy, benefits and features, reputation, sales channels, image, and financial strength.

With your market research, study of the prospective buyers, and competitors, you can develop your pricing strategy. Do your benefits outweigh that of the competition so that you can demand pricing at the top of the scale? Do your costs of production and delivery provide the opportunity to sell on lower price? Selling at the low end of pricing is usually a bad choice that can lead to price wars. You need to identify an area where you will have an advantage, maybe even an unfair advantage. Bundling of products, service benefits, application knowledge, location, features, and benefits, benefits, benefits…..can support higher pricing. Look at your pricing from your customers’ eyes and justify the value of your products/services. Make sure that your pricing provides adequate income for your business

Your marketing message should always speak in terms of benefits to your marketing segment customers/users. It is natural for us to fall in love with our products and tend to brag about them in our marketing messages but remember, the customers do not care about that; they only care about what that product can do for them. Always speak in customer language.

In marketing, there is value in repetition, so develop a short marketing message or brand that you use constantly to enforce the message of the essence of your business. Your collateral, advertising, logo, and signage should repeat this brand. As time goes on, you may wish to rebrand your business as conditions change, but remember the consistency of the image you wish to project.

A 12-month marketing plan should be developed and incorporated into the organization’s business plan. Begin by identifying the goals of the marketing plan such as to increase the awareness of your business among prospective customers, attract more customers to buy, and increase customer satisfaction and thereby increase more referrals. Develop a chart by month for the next year with tasks, roles/responsibilities, completion time, materials, social media activities, alliances, email marketing, conferences/trade shows, target media contact list, tools/resources, and budget. This plan should be reviewed monthly and fine-tuned with new information learned.

The budget should identify target customers and sales channels to reach them. It should also include one-time charges, monthly expenses, and staff time.

A summary of the marketing activities can be shown in a marketing calendar to serve as a reminder of what is required at which time. It should be reviewed monthly for learning of the value of each and adjustments made accordingly.

Your image and service need to be appraised constantly. Is your facility neat, orderly, and appealing? Are you and your employees knowledgeable, courteous, and helpful? Is your website easy to navigate with a clear call to action? How well do you handle customer inquiries and complaints?

The question stated earlier on whether you should sell what you can make or produce what you can sell cannot be answered simply if you want to optimize your success. It is an iterative process to be studied carefully and strategized for best results.

Like anything else in business, your marketing strategy needs to be current, which means regular review and making corrections as needed. It is a key guide in attaining success.

Reference:  SCORE Marketing Cookbook

Simple Recipes for Marketing Success

A Solution to Some of Community Challenges

Basic Business Cents

Listening to conversations around the community, many challenges facing small communities are revealed. Some of these lamentations are:

·      Local youth do not have anything to do

·      Young people can’t find work in this area

·      There are help-wanted posters all over town

·      Youth don’t know how to work

·      Youth do not stay in this community after schooling

According to Stars and Stripes, a newspaper for the US Armed Forces, 70% (yes, seventy percent) of today’s youth cannot qualify to join the military. The major reasons are:

o   Obesity

o   Didn’t finish high school

o   Criminal record

Years ago, many youth enlisted in order to get a job and learn a trade or were given a choice of jail or enlistment by a judge for some youthful indiscretion.

Sports, music, and other school and church activities partially fill this void for some, but not for all.  There is a simple solution to these problems today for many of our youth, GET A JOB! A part-time job that is; it should not delay or deter anyone from finishing their degree work. In fact, local high schools cater to those students who wish to participate in the work force and complete their education. The degree is tremendously important today with the complexity we face in any job. The lack of it will forever haunt and hold back any youth that quits before graduation.

This subject brings up the concern of labor laws. A Guide to Starting a Business in Minnesota published by the Minnesota Department of Employment and Economic Development clarifies this subject.

·      A minor under 14 may not be employed, except:

o   If at least 11 years old, as a newspaper carrier

o   If at least 12 years old, in agricultural operations with parent’s or guardian’s permission

o   As an actor or model with approval from the Minnesota Department of Labor and Industry

o   As an assistant soccer referee

·      A minor under 16 may not work:

o   Before 7:00 am or after 9:00 pm, except as a newspaper carrier

o   More than 40 hours a week or eight hours in a 24-hour period except in an agricultural operation

o   On school days during school hours, unless an Employment Certificate is issued by the appropriate school officials and kept on file by the employer

·      Sixteen and 17-year-old high school students may not work:

o   After 11:00 pm on evenings before school days (11:30 pm with written permission of a parent or guardian) or

o   Before 5:00 am on school days (4:30 am with written permission of parent or guardian)

Ideas without action are worthless. It appears that a matchmaker or focal point is needed to match youth who want a part time job with employers who want to help. Local high schools might be in the best position to be this matchmaker or clearinghouse. The youth need someone to talk to about their desires and have a two-way discussion with someone who has knowledge of opportunities.

The employers in the community need to create these opportunities as a part of their civic responsibility in addition to increasing their workforce. The parents need to counsel their children on the opportunities and benefits of part-time jobs.

Benefits, in addition to addressing the lamentations listed above, are numerous to all concerned.

The community benefits by adding to the work force energetic, willing-to-learn employees who might be more tempted to stay in the community after finishing their education. The employers gain by obtaining additional workforce at fairly low cost who might become full-time employees after completion of their education. The youth gain by obtaining fulfilling use of their time, exercise, income to aid their families or save for future needs, learn jobs that they do, or do not, like, and experience higher self-esteem.

That sounds like a win-win-win solution to complaints heard on the streets.

Choosing the Form of Business Organization

Basic Business Cents

One of the first questions facing an entrepreneur is what type of organizational structure is best for the start-up company. This is a key decision that could have serious consequences later; one that many entrepreneurs are ill equipped to make. A free publication by the Small Business Assistance Office of the Minnesota Department of Employment and Economic Development (DEED), titled A Guide to Starting a Business in Minnesota, devotes 60 pages to this subject. This 357-page book covering a variety of start-up considerations can be obtained without charge by contacting:

Telephone: (800) 310-8323,

Fax: (651) 296-5287, or

Email: deed.mnsbao@state.mn.us

A simple comparison of the four basic business structures can be viewed by comparing pros and cons of each. Note, this is the author’s opinion drawn from research and experience and does not constitute a legal position. Legal advice must come from an attorney admitted to the bar in Minnesota and is a necessity for anyone considering starting a new business.

	PROS	CONS
Sole Proprietorship	Simple Owned and controlled by one individual Profits are taxed at the individual’s rate	Individual is responsible for all debts and obligations of the business Individual bears the legal responsibility for the business
Partnership    General Partnership      Limited Partnership	All partners share equally in the right, and responsibility, to manage the business Partners are taxed on their respective share of the profits at the individual’s rate. The limited partnership must have one General Partner and at least one Limited Partner. The limited partners share in the liability only up to the amount of their investment in the business.	Each partner is responsible for all the debts and obligations of the business Partnerships lead to disagreements causing serious disruptions to the business The General Partner has the right and responsibility to control the partnership but is responsible for the debts and obligations of the business. Limited partners do not have the power to act or bind the business.
Limited Liability Partnership (LLP)	The personal assets of the partners are shielded against liabilities incurred by business in tort and contract situations. Profits are taxed on the individual’s respective share of the business at the individual’s rate.	Care should be taken that the correct initials must be displayed as a part of the name of the organization. An LLP is a fairly new form of entity and not well understood by everyone.
Limited Liability Company	Liability for business debts and obligations generally rests with the entity rather than with individual owners. It is not subject to many of the restrictions that apply to an S Corp.	Must obtain both Federal and State Tax ID numbers.
Corporation       S Corp      C Corp	A corporation is a separate legal entity, which in most cases shields insulates shareholders from claims against the corporation. An S Corp is taxed much as the same way as a partnership. Profits/losses flow through to the shareholders in proportion to their holdings. Best liability protection for the shareholders.	The S Corp must meet the statutory requirements like no more than 100 shareholders, no alien shareholders, only one class of stock. Dividends and salaries are taxed at the individual’s rates plus the entity has already been taxed at the corporate rate.

An individual or partnership that conducts business in Minnesota under a name that is different from the full, true name of each business owner must register the name of the business with the Secretary of State.  An assumed name will not be accepted if it is the same as the name as another entity on file. Business owners may call the information line of the Secretary of State (651) 296-2803 go to the web site at www.sos.state.mn.us to determine if the name is available.

All businesses will encounter certain organizational costs. Both legal and accounting professional help is strongly advised.

Source: A Guide to Starting a Business in Minnesota

Thirty-Second Edition, January 2014

Minnesota Department of Employment and Economic Development

Closing the Gap in Your Management System

Basic Business Cents

Our last column presented an overview of a management system for performance improvement to close the gap from where you are today to where you want to be, or need to be. This system ,called ADAMS, is an acronym for Assess, Discover, Act, Manage, and Sustain.

Phase 1. Assess

·      Complete an assessment of performance and perceptions. A complete disciplined determination of your organization’s performance is important to document your starting point; and since perception is reality, check on how you are viewed by customers and by the marketplace. The MN State Quality Award or the Malcolm Baldrige Award criteria have excellent ways to assess any organization.

·      Verify strategic alignment. Determine if your current position and where you desire to go are properly aligned with your strategy. Misalignment is often a major cause of problems.

The output of this phase is a clear and well-documented picture of your organization’s current performance, where it needs to be, confirmation of alignment between strategy and current direction, and a baseline for measuring future progress.

Phase 2. Discover

·      Establish Discovery Teams. Establish individuals or teams to investigate barriers preventing the organization from achieving breakthrough results.

·      Select Projects and Formalize Portfolios. Define the most prominent problems and issues and establish projects to address.

·      Determine Appropriate Initiatives. Determine the approach, tools, and methods to improve the processes or systems of complex problems.

Based on a disciplined review of the underlying problems facing your organization, define and prioritize specific projects to be completed and establish broad portfolios to manage.

Phase 3. Act

·      Do it! Establish a culture and approach where obvious problems are solved without undo management review and analysis.

·      Deploy Initiatives of Complex Problems. Select teams to address major problems, provide them with tools, authority to make process change, and manage progress.

Because of a focus on quick-hits and deployment of long-term initiatives, you are able to see immediate results and the efficient use of everyone; everyone gets involved and committed.

Phase 4. Manage. Once the assessment has been completed, the direction and action determined, and initiatives deployed, the most important function is to successful manage all of these activities. This is an iterative process where you will need to often return to review your assessment and verify your results. The deep involvement of senior management and the constant commitment of employees at all levels is required to continue to drive positive results.

This phase ensures an effective coordination of short-term projects with long-term initiatives. Best practices must be shared and driven across all functional elements.

Phase 5. Sustain. Success in assessment, discovery, action, and management can still run the risk of seeing initial success deteriorate into long-term failure. If you want long-term success, you must master the last phase-Sustain.

·      Institutionalize. Move beyond changing behavior to changing culture. This is a difficult task, yet it has the greatest benefit. If you focus only on the improvement techniques and not address the culture of how you work, manage, and treat others, then the lasting effect desired will be eluded. An atmosphere of mutual trust and respect must become pervasive throughout the organization.

ADAMS is an iterative system where you will need to constantly work through all of the phases enabling you to drive to higher levels of performance. If you don’t, your competitors surely will.