Productivity - Hire Thinking People

Today productivity is no longer defined as simply doing what has been assigned. Most businesses are far too complex for managers or owners to think that they can just give orders or possibly know everything that needs to be done to satisfy a customer. Virtually all employees need to be thinking and making decisions in their special area of contribution. What’s more, people are now arriving at work expecting to be allowed to think, to get paid to think and to have their thinking considered action.

What do we do with this new reality? Here are five tips to hire thinking people and get the most from them:

Sell your company’s best attributes
Salaries and benefits are no longer the attraction they once were. They still matter, but now employees have other considerations of equal importance. Telecommuting, flex hours, and green working space are new perks, but most importantly people seek opportunities to do personally rewarding work and develop special talents—these are important attributes for new hires. How can you position your place of employment so that talented people end their job search when you make them an offer?

You must be able to define your company’s unique value proposition for potential new employees. Here are some questions you must anticipate and answer even if they are not asked:

  • Why is your company a great place to work? Who excels, and who thrives in your environment?
  • Why have people stayed, where did they begin with you, and where are they now?
  • What have they learned and accomplished while part of your organization?
  • How is their life, not their wallet, richer for having made the choice to work in your company?
  • If I accept your offer, why will I want to stay?
  • Who personally will care if I stay?
  • Who will keep track of my satisfaction and development?

Think not only in terms of economic rewards, but also in terms of an invitation that you are extending to someone to spend significant time--their most precious and non-renewable resource--with you. How will working with you contribute to their vision? You can’t answer that for anyone but you sure can ask and then be prepared to listen. This question alone will set you apart from other possible employment opportunities

Treat employees as investments, rather than expenses
Investments are choices you make. You work to make them more valuable. The future value of any knowledge business can essentially be measured by the talent on board at any point in time. What you have done is not nearly as important as what you will be able to do next.

Employ people who are smarter and better than you at particular parts of the business
We live in a free agent economy and people go where they’re free to make the largest contribution. If you are the most talented person around, you have defined the limit of your business.

Hire wisely
The workforce today is shrinking. Talent is in increasingly short supply. At the same time, the workforce less educated than in the past. You have fewer great candidates to fill your openings. This means you can afford fewer mistakes with your hiring choices and less turnover.

Do you already have employees you would hate to lose? Determine their talents and strengths, as a group and as individuals, and seek these in new employees. Ask employees for referrals and ideas about where to find others like themselves. If you have significant numbers of people doing similar work consider using a selection system, pre-employment profiling etc. There are many good ones available today.

Additionally, do not think that just because someone can perform a task that they will want to perform that task once in your employ. Ability and desire are not the same thing. Once people are employed you should begin immediately working to make them successful. This means determining accountability for new employee success and retention. I recommend this as the primary responsibility of immediate managers. Review your managers and determine whether they have the skills and interest for this responsibility. If they have interest but not skills take steps to provide these skills, look for outside counsel here. If your current managers are not interested in this responsibility ask them to step aside and make room for someone who is. This may sound rash or harsh but you simply cannot afford managers who do not understand that your employees are investments not resources.

Relinquish control to creativity
This is not your parents’ workforce! If you are 40+, it may not even be the workforce you entered. Today’s talented workers are not afraid of uncertainty. They fear not having the opportunity to express themselves. Your place of business will either fit their plan or they will not be around. Longevity is less compelling to them than creativity. Are you willing to let them make your business better and then share in the returns received?

Whether you are a hiring manager or the future employee’s co-worker, we all have a role in attracting and retaining talent. We have a lot to learn about job seekers, about the “new guy” who just started, about a valued co-worker who wants more freedom of expression, and about ourselves.

Mike Cook is founding partner of Vitalwork, Inc. (www.vitalwork.com), an organizational development firm


Uncover Hidden Money in Your Company

Many business owners would be surprised by how much money they lose to suppliers each year. They don’t lose money by paying the supplier a fair price for a product or service; they lose it from billing errors, excessively high supplier pricing, paying for unnecessary items, and inefficiency. Most CEOs are unaware of all the places where money can leak out, and without knowing where the money leaks from, it’s hard to repair those areas. Here are eight of the most common areas where supplier-related losses occur:

  1. Healthcare costs are not always priced or billed accurately. While premiums are generally tied to your company’s health expense history, sometimes those health histories are inaccurate predictors of future risk, or they contain errors. Additionally, price increases in health care may not reflect competitive market conditions or best plan designs. We often find 5-10% savings by using a healthcare savings methodology that specifically focuses on finding the best competitive pricing for a company’s unique situation. Ten percent savings, when applied to your largest expense after salaries, can represent a large amount of money.
  1. Telecommunications services typically represent a company’s third-largest expense. Bills are often rife with errors and not competitively priced. Most people have difficulty understanding contracts and bills for voice, data, long distance, cellular, conferencing, and related services; thus, many billing errors go unnoticed. Additionally, the billed price is often not the most competitive price offered by the provider. Companies should have experts auditing and monitoring this expenditure. It’s not unusual to find an average of 30% savings once a company begins to optimize these bills.
  1. Utility costs for manufacturers, hospitals, and high-energy use, locations are usually the next largest expense. Understanding your energy usage and how you are billed and contracted is the first step toward significant savings. Modern supply management and environmental control techniques can be used to conserve energy use and save on utility costs. For greater savings, companies can bring in environmental engineers to work on energy saving projects, which typically pay off within six to 24 months. Many business can save 15% of their utility costs by combining these techniques.
  1. Business risk insurance and premiums on coverage such as errors and omission, director and officer, umbrella liability, worker’s compensation, and other policies can often be reduced. Pricing for these products is tied not only to your industry classification, but also to your risk exposure. Reducing your risk exposure can reduce your premiums. Some insurance brokers offer to forgo commissions and take payment as a risk consultant. Their fee is usually similar to the commissions that they would have earned. A business owner wins twice in this arrangement — first, by reducing net savings by up to 20%, and second, by lowering the company’s risk profile.
  1. Freight costs can be a profit center or a huge cost of doing business. Companies should create a pricing paradigm that covers freight costs or turns those costs into a profit center. Once this is done, companies should pursue freight optimization. It’s best to think in terms of the shippers’ cost of doing business. If you can lower that, then you can lower your own expenses. Small companies can simply ask their carriers what they can do to get lower prices. They can also bid out jobs with multiple carriers. Larger companies should bring in freight experts to understand the companies’ requirements and traffic patterns, then match those through a bid process with qualified carriers.
  1. Taxes are often over paid by companies trying to be honest when filing their taxes. Most states offer tax credits that many companies could take advantage of, if they were aware of them. Some examples include credits for cost segregation, training, hiring, research, green initiatives and other programs.
  1. Accounts payable audits can recover expenses a business paid in previous years that were incorrectly invoiced by suppliers or incorrectly paid by staff. These may include overpayments, duplicate payments or incorrect taxes. Cash recoveries are often less than one percent of your total account payable spend, but it can add up to big money. Business owners who really want to add up savings should review procurement and accounts payable together. In many companies, these departments do not even talk to each other.
  1. Procurement is usually focused on product purchases and tactically tied to “right-price, right-place, right-time” urgency. This paradigm leaves little room for saving money. However, companies can save by strategically managing contracts, supply chains and vendor negotiations. We recently consulted with a large company and found $100 million in technology contracts not tied to a contract management system (used to alert management on expiration dates of leases and automatic renewals). The company renewed these contracts year after year with escalating prices, without renegotiating. Had the company tracked these contracts, it would have saved up to $20 million per year.

What steps can you take?

If your company has less than 50 employees, we recommend the following steps:

  1. Ask other CEOs, CFOs who they use for insurance plans, telecom solutions and accounting. You may discover trustworthy insurance brokers, solution providers, consultants and accountants who can save you money.
  2. Ask your suppliers (i.e., broker, healthcare providers, telecom reps, etc.) to review your spend and recommend ways of lowering your costs. It’s not unusual for suppliers to have money-saving programs for which you qualify but aren’t currently enrolled in.
  3. Source quotes from multiple companies. Creating competition for your business drives down vendor prices.
  4. Never mistreat or verbally abuse your suppliers over price concerns. You may save a penny but often lose dollars.
  5. Invoice cost and total cost are different. The lowest-cost service may have poor long-term results that harm your business and cost far more in the long run.

If your company has over 50 employees, we recommend the following steps:

  1. Consider bringing in an expense management consultant. These consultants specialize in cost management and segregation, insurance, heath care, telecom, contracts, tax credit programs, and other areas. In-house staff can tackle many supplier-related issues to find savings, but they almost always obtain lower results than professionals. Many professional expense management consultants will work on contingency. They take a percentage of the savings they find, rather than a retainer or flat fee as payment.
  2. If you decide to use in-house staff, start with the highest “spend category” first. Even nonprofessional expense managers can usually find some savings.
  3. Ask other CEOs, CFOs which service providers, reps and brokers they use. As in any field, there are world class service providers, reps and brokers and there are uninspired ones. The good ones go the distance for you and know how to save you money.

Rules of thumb for when an expense management consultant should be hired:

  1. Healthcare: When you spend over $250,000 per year
  2. Telecom: When you spend over $4,000 per month
  3. Utilities: When you own your building or use high-demand equipment and spend over $250,000 per year
  4. Business risk insurance: When you spend over $100,000 per year
  5. Freight: When you spend over $500,000 per year
  6. Taxes: If you are hiring new employees, doing research, building or occupying your own building or performing measurable training with at least 20 people
  7. Accounts payable: When your total expenditure is over $50 million
  8. Procurement: When you spend over $1 million in any one category

Whether on your own or with a specialist, business owners should consider ways of limiting losses as ways to keep more money in the bank. The money you save or recover from supplier-related losses is like an annuity that pays monthly in savings.

Jim Villwock founded IEM Group, Inc. in 2002 after saving companies over $500 million worldwide. Today, his team helps companies with indirect expense management and identity theft solutions.


Strands aquires Expensr

Corvallis startup announces acquisition, new service

Posted by The Silicon Forest Blog April 29, 2008 09:37AM

Categories: The Startup Scene

Strands, the Corvallis startup formerly known as MyStrands (which was formerly known as MusicStrands), says this morning that it's acquired a small online personal finance company called Expensr.

Strands also launched a personal finance service, moneyStrands, designed to give out personalized recommendations for financial information.

Strands is an online social networking service that delivers customized suggestions for music and other things site users might enjoy.

No word on how much Strands paid for Expensr, which was based in San Francisco (and, Strands tells me, will stay there). Here's a writeup from Business 2.0 last summer, which pegged Expensr as one of 10 companies forecast to be among "The Next Disruptors."


Rails Conference - Portland May 29th

If you're passionate about Rails and what it helps you achieve—or are curious about how Rails can help you create web applications better and faster—RailsConf is the place to be


Ensuring Your Business Cards Mean Business

A 54-year-old marketing executive, unemployed since October, hands out a simple business card as part of his job search. It lists his name, phone numbers, email account and suburban New Jersey address. "I am a bit of a traditionalist in how I present myself," he explains.

Yet by divulging nothing about the executive's qualifications, his card hurts his chances to find work.

"This kind of card leaves you empty," contends Diane Darling, CEO of Effective Networking in Boston. "A business card represents who you are, reminding people why they should hire you."

Whether you're starting over or starting out, you need a business card that makes a memorable first impression in today's tight employment market. How can jobless older applicants and young graduates devise cards that are successful marketing tools? There is no single formula for winning with cards, of course. But here are some strategies that might help:

Don't sell yourself short.

Put your profession, strongest skills or highest degree right under your name. For example, the New Jersey man should revamp his card and call himself a "Senior Marketing Executive," suggests Gail Madison, director of a business-etiquette school in Huntingdon Valley, Pa. She believes a title "is the most important information on a card."

Her idea "makes a lot of sense," the unemployed manager agrees. He will consider adding "Strategic Marketing Executive" to his card.

Cards for recent alumni of well-known universities should contain their major, graduation year and school's name. If your alma mater approves, insert its logo.

Out-of-work applicants of any age also should buy and display a personal domain name on their cards. "You have a lifetime email address" even if you lack a Web site, Ms. Darling observes.

Exploit the reverse side.

"The back side of the business card is just undeveloped real estate because it's blank 90% of the time," insists Kevin Donlin, a professional résumé writer and job-search author in Edina, Minn.

Fill the top half of that space with key bullets about your professional achievements, the name of a prominent prior employer and addresses for your Web page, LinkedIn profile or "VisualCV."

VisualCV, a free service for individuals offered by a Reston, Va., start-up, lets job seekers create an online résumé that can include work samples, references' video testimonials and a visual for accomplishments, such as a chart showing surpassed sales targets.

"The way to make sure people read the back of your card is to ask," Mr. Donlin continues. "Say, 'There's a mini case study on the back about how I beat D&B's target by 59% in 2007 with half the budget and 71% fewer staff. Would that interest you?' "

Be creative -- within limits.

Printing cards on shiny paper looks distinctive, but defeats their purpose. Laurie Hayes, a small-business coach in Sudbury, Canada, attended a networking event where a man gave her a card made of slippery plastic. Extra information that he scribbled on it smeared.

Your photo probably doesn't belong on your card. "I never saw a C-level [executive's] card with a picture," Ms. Madison says. A photo enables a hiring manager to remember your face -- and also discriminate against you, Ms. Darling notes.

A card with an impressive tagline stands out as long as you can substantiate your expertise.

Unemployed following the dot-com bust, Jeff Ackley landed a business-development job at an electronic-games company partly because his card bore a solid pitch. It said he sought a position where his five listed skills could propel a young business into profitability. A card with a personal pitch "is far more important today," says Mr. Ackley, now a Boston entrepreneur.

Use a simple typeface, high-quality paper and an elegant design. Match your résumé font.

A professionally prepared card shows you mean business. Ms. Madison met a woman at a Chamber of Commerce card-exchange session who offered a business card she had printed on 20-pound computer paper, cut out and signed by hand. "How can I take this person seriously?" the etiquette specialist wondered.

Create different cards for different opportunities.

This piece of advice especially makes sense if you possess many talents and are unsure what to do next, such as the New Jersey marketing executive, an expert in strategic planning, product management and contract negotiation. "I am seriously entertaining" the notion of preparing multiple cards, he says.

On the other hand, certain recent college graduates consider any cards unnecessary in their online world. "The very definition of 'business card' is kind of outdated now," a jobless 27-year-old woman reports.

Perhaps business cards are passé among 20-somethings, Ms. Darling says, "but 20-somethings won't give you a job."

by Joann S. Lublin, Wall Street Journal

Working Well With Executive Recruiters


The higher you rise along the corporate ladder, the more attractive you're likely to become to executive recruiters. But even if they contact you first, your odds of getting a job as a result can flounder if you don't understand how the search business works. For example, some up-and-coming corporate leaders withhold critical information, such as their current salary, due to privacy concerns. Yet recruiters work on a confidential basis, asserts Wes Richards, a senior client partner and managing director at Korn/Ferry International Inc. "We're like your doctor, your priest or your lawyer," he says. To avoid being labeled a greenhorn, see these tips for forging and managing strong relationships with recruiters.

Your First 90 Days

Be sure. Offer yourself as a candidate to recruiters only if you're serious about wanting to change jobs, warns Daniel Cahill, president of Hobson Associates Inc., a boutique search firm in Cheshire, Conn. "Don't call a headhunter because you had a bad day, you're bored or mad," he says. Carefully assess your situation first, because if you turn down a recruiter's interview offer, chances are he or she "won't work with you again," he says.

Be specific. Let recruiters know if you'll only work in a certain area, geographically or industry-wise, and keep in mind that the thinner your search parameters, the fewer your options, says Mr. Cahill. Also, avoid saying you'll move anywhere for a job if you don't really mean it. "Anytime you renege on an opportunity or change your mind, you create a problem," he warns.

Provide references. Include three names—and their contact information—when you send recruiters your resume, says Mr. Cahill. These can be former bosses, colleagues or people you managed. The effort will help bolster a recruiter's desire to represent you to his or her clients, he says.

Ask smart questions. If a recruiter approaches you about a career opportunity, show you're job-search savvy by inquiring about the size of the employer, its culture, the competencies needed for the position and whether you're the first candidate to be considered, advises Mr. Richards. Also request a copy of the job's specifications. "The recruiter will say this is somebody who understands the bigger picture and is digging in deep to understand what the job is all about," he explains.

Explain rejections. For jobs that aren't a good match, let recruiters know why, says Mr. Richards. This will allow them to clear up any false impressions you might have or gain a better understanding of what you prefer. It also may prompt the search professional to add you to his or her tickler file for consideration down the road. Mr. Richards says about three-quarters of the candidates he places are people he'd previously tried to place. Meanwhile, if possible, recommend someone else for the jobs you turn down. "Headhunters are quid pro quo people," says Mr. Cahill. "They keep score."

Stay involved. Check in with recruiters about once every two weeks to stay on their radar, unless you have something to report, such as feedback on an interview you completed or any progress you made your own. "A headhunter doesn't want to be embarrassed calling a company you already have an interview with," says Mr. Cahill. Act as your recruiter's assistant by researching companies and offering a list of ones you consider a strong fit. "Those are the people I work hardest for," he says.

Suggest moving on. If a recruiter hasn't secured you any substantial interview invites after 90 days, ask for a reference to another search professional in your niche, advises Mr. Cahill. The request might motivate the recruiter to try harder. "Headhunters are competitive," he says.


Job Market Worries? Not for Very Long

Though we wisely worry about rising unemployment during this recession of 2008, there is another, quite different problem that soon will confront the nation: a shortage of workers.

The challenge will not be too few jobs, but too few people to hold them.

Americans of childbearing age simply are not producing enough kids to meet the economy's future need for workers, notably in fast-growing fields such as medicine and engineering. The shortfall is coming largely because the fabled baby boom generation was so huge—75 million Americans born in the 18 years from 1946 to 1964—that no other generation can be expected to match it any time soon.

Now the baby boomers are aging—they range from 44 to 62 years old—and their overall numbers in the labor force are shrinking.

They are being replaced by two younger generations, each with its own desires regarding the opportunities and rewards available at work. The challenge for hiring managers is to figure out what these workers' needs are, so that employers will be able to find them, hire them, and keep them on the job.

The different generations are being intensely studied by W. Stanton Smith, a human relations specialist and a principal of Deloitte LLP, the consulting firm. In his recent book, "Decoding Generational Differences," Smith identifies three generations, and what each wants from employers.

The baby boomers: They place a heavy emphasis on work and successfully climbing the corporate ladder. Work is an anchor in their lives.

The Gen Xers, born between 1965 and 1980: They enjoy work but are more concerned about the work-life balance.

Generation Y, also known as Millennials, born after 1980 and now age 28 or younger: They often have different priorities than their Gen X and baby boomer counterparts, Smith says.

"Because of their reliance on technology, [Millennials] think they can work at any time and any place and believe they should be evaluated on the basis of work produced—not on how, when or where they got it done. Curiously, most Millennials want long-term relationships with employers, but on their own terms," Smith says.

"The real change in their work-force attitudes is a decrease in ambition in favor of more family/personal time and less pressure in life generally speaking," he says.

Also, the Millennials have been raised to question authority and demand value for money. They came of age in a world of layoffs and corporate scandals, fostering the belief that businesses in general, and big businesses in particular, value their own financial gain above all else, and that business talk about the importance of people is largely insincere.

The Millennials respond poorly to those who act in an authoritarian manner and those who expect to be respected due to higher rank alone. They believe they can learn quickly, take on significant responsibility and make major contributions far sooner than baby boomers think they can.

In the next decade, according to Smith, the American professional work force will continue to age and shrink. The median age of the overall population and the labor force will increase as the majority of the baby boomers move into their 50s and 60s, and the oldest into their 70s. From now until 2015, workers aged 55 to 64 will be the fastest-growing segment of the labor force.

Between 2003 and 2008, an estimated 24 million baby boomers will have left the active workforce, primarily from executive, administrative, and managerial jobs.

Gen X presents a much smaller pool of available workers, and will not be able to fill the positions left vacant by retirements. The pool of available workers among those aged 25 to 44 will have decreased by 7% from the level of 2003, resulting in a significant labor shortage.

"In fact," says Smith, "every year for the next 30 years, there will be fewer young people to replace retiring workers. The labor shortages will continue well into the future, as average annual growth of the work force is projected to hover at around 1% through 2015."