It’s a new year and many people are setting new goals. It is wonderful that people feel like the New Year is the time for a fresh start.  Here are some things you should consider when making personal changes:

• You must know what you want as an end result of your efforts.  To begin 
   you don’t need to know every step, but you must know what your desired
   results will be.
• You will need to do more than just work harder.  What you do is actually
   more important than how hard you work at it.  Your level of effort doesn’t
   matter as much as the kind of effort you put forth. 
• You will have to take risks.  Most people equate risk to danger or potential
   loss, but in this case risk equates to different.  The risk of not doing
   anything is more damaging to reaching your goals than the risk of not trying.
• You cannot be deterred by failures.  Risks often result in failures, but failures
   can help you.  Failures are really feedback that let you know that your method
   or your process didn’t work.  When you get that feedback, take another
   approach to reaching your results.

     Make a change even a little change; you’ll find that momentum will build and pretty soon you’ll be moving quickly to the results you want.

     The Roman god Janus is the god of beginnings and transitions.  He is usually depicted as a two-faced god since he looks to the future and the past.  Because Janus looks forward and backward he watched out for gates and doors, as well as beginnings and endings. 

     The month January is named after the god Janus.  January is the door to the year – we consider it the beginning of the new year, filled with promise.  I suggest that we consider where January got its name and begin the new year by looking forward as well as backward.

     Ignorance of the past may be psychologically blissful, but repeating the errors of the past can be expensive.  Take a look at the mistakes and errors of the past year and note what you learned from them.  As you plan for the new year make sure your strategies avoid those errors and mistakes and capitalize on the knowledge you gained from those errors and mistakes.

     Remember that Janus looks forward and backward.  Promising solutions in today’s business world requires that you look to the past and then to the future.

 

     Social media is here to stay and many businesses are wondering how to handle it.  Those that block it are removing themselves from the conversation and those that embrace it will want to structure policies around it.

     An effective social-media policy should:

1.  Explain the scope of prohibited activities – no defaming the bosses, harassing co-workers, or revealing company secrets.

2. Clarify which employees are affected by the policy.  For some employees using social media might be part of their job, other employees you may want to limit their use to on breaks or outside of work.

3. Describe any monitoring system in place – who uses it, and how.

4. Explain the penalties.  What can the employees expect from the enforcement of the policies and what consequences might they face?

5. State that your social-media policy is not intended to interfere with protected activities or infringe on employee rights.

     Before you go an implement a strict ban on social-media activity, please know that social networking, in certain contexts, may be considered a protected employee activity.

     For example, when employees seek to improve their working conditions via social-media applications, their blogging may be protected under the National Labor Relations Act, even if such activities are prohibited by company policy.

     Further, before you rush to take adverse action against an employee blogger, make sure not to violate anti-retaliation or whistleblower laws.

     In addition to social-media bans, employer monitoring of employee Internet activity may result in antidiscrimination violations under Title VII of the Civil Rights Act or the Americans with Disabilities Act, or the Age Discrimination in Employment Act.  An example of this would be finding information on social-media sites and using that information to evaluate employees.

     There may also be certain state laws that may protect an employee’s use of social-media applications as “off-duty” conduct.

     There are tools to monitor social-media activity, but if you feel like you need to monitor your employee’s social-media activity you might have a bigger problem than social-media.  You might have the wrong people on your team.

     Many companies use endorsements and testimonials in their marketing.  The FTC has a set of rules for endorsements and testimonial that you must abide by or you’ll be in trouble (16 CFR Part 255).  Here are three errors that will cause you to get into hot water with the FTC:

Error #1:  Using Family and Friends.

     While the easiest place to get endorsements or testimonials are your family and friends, the FTC says you cannot use testimonial or endorsements from friends and family.  To stay out of hot water obtain your testimonials from real customers who are not family or friends.

Error #2:  Providing any form of compensation or material connection for an endorsement or testimonial.

     Your testimonials must be provided free of any compensation or material connection.  Material connection can include the promise to be on television.  The FTC says that the knowledge of potentially being on TV is a material connection due to the motivation factor.

Error #3:  Posting Typical Results that are Not Typical.

     If you talk about the results and infer that the results are typical then you must have proof such that some other group could conduct the same research with the same results.  The study must have scientific and statistical significance.

     Make sure your endorsements and testimonials adhere to the FTC guidelines and you’ll never have to worry about who’s knocking on your door.

There are two very foreboding terms when it comes to projects:
     1. Deadline, and
     2. Drop dead.

Every project has a deadline and often we ask, “What is your drop dead on this project?”  Your drop dead?  If we don’t get this project done on time is someone going to die?

Every project has a deadline.  Usually these fall within a comfortable, non-fatal time frame.  However, there are some projects that need to move faster than the typical project and while someone might not die if the project isn’t completed on time they might lose their job.  Here are five critical steps to making sure the project gets completed on time:

1. Break the project into sections.  This is standard advice for any project, because it works.

2. Determine the resources (human/machine, time, money, etc.) needed to complete each section. 
This will allow you to see where your bottlenecks for completing the project on time are.

3. Have a start and complete date and time for each section of the project.  This will help everyone to know if you are on schedule and helps all those involved in the project to plan accordingly.

4. Post the project timeline for everyone to see.  This provides accountability during the project and inhibits finger pointing at the end of the project if the deadline is not met.

5. Hold regular accountability meetings on the project.  Refer to the timeline and manage your resources.

     When the project is over review with it with your team.  Learn from your mistakes and celebrate your successes.

     “We want you to help us grow the business.  As the business grows so will your pay.  If we do well, so will you.”  Have you ever said that to staff?  It may sound good, but it isn’t.

     When you create the expectation of a bonus, you set yourself up for failure and you set your staff up to be entitlement oriented.  You need to stop this mentality of, “The salary is meaningless.  But, if you actually do your job you will get a bonus.”  Growing your business IS their job and they get paid for doing it.

     Why is it that you think you need to give them a bonus?  Your employees should be paid a fair wage to do their job.  When you create the expectation of getting a bonus for doing their job, you staff may become entitlement oriented.  They begin to think that they deserve the bonus for doing their job – it is expected.  Further more, bonuses rarely inspire bad workers to be good workers.  Usually what happens in the good workers work harder and the bad workers continue to do nothing, yet everyone gets a bonus.

     When bonuses are paid I end up seeing staff being paid much more than the market would compensate them.  What staff did was apply to answer the phone or do the accounting they knew when they applied for the position what the pay range would be, so don’t inflate their pay.

     School teachers don’t take their job with the idea they will get rich, most people don’t apply for a receptionist position thinking it will make them a millionaire, and most of your staff didn’t take their jobs thinking that they would become billionaires as a result.  So don’t create those expectations when you talk about paying them a bonus for doing their job.

     Your staff should not earn a percentage of your business’ profits just because they work there.  Let’s face it, the staff didn’t buy into the business. They didn’t sign a five year lease.  They didn’t take out the loans to start the business.  They didn’t quit their secure jobs and risk everything to open up the business.  In fact, when the times are tough the employees can look elsewhere for a job, but not the owners.

     Stop trying to find a bonus formula for staff.  Pay your staff appropriately and expect them to do their job and grow your business.

Story #1

“Would you be willing to donate money to help a poor widow?” a stranger asked me.  “She has two kids and just lost her job.  And she is about to be thrown out of her apartment unless she can raise $475 for rent.”

“That’s awfully nice of you,” I replied.  “You must be a very caring friend to be raising money for her like this.”

“Not really,” he said. “I’m her landlord.”

Story #2

A man purchased a parrot.  On the third day of owning the bird the parrot became listless and quit talking.

The man went back to the pet store where he bought the parrot and asked the store owner what he should do.  The store owner sold him a toy to stimulate the parrot’s attention.  Still no improvement.  Over the next few days the parrot’s owner bought other toys hoping to revive the parrot’s interest, but the parrot kept getting more listless.

Finally on the seventh day, the parrot lay feebly on his back, and weakly asked, “Don’t they sell birdseed at that store?”

1 Lesson:

Like the widow’s landlord, many business owners are looking for answers to their problems.  Like the man who bought the parrot, you can overlook the best solutions to problems.   Where do you find these solutions?  From your employees and customers.  Ask them, they’ll tell you from their perspective what your business can do.

     According to a USA Today poll 25% of the American workforce plan to leave their current jobs and start a business of their own.  That’s their plan, yet many will never follow through.  Here’s why, our brains are better suited to stalking wild prey than to opening up a business.  David Laibson and Robert J. Goldman Professor of Economics at Harvard, did some research and came up with an interesting finding:  Our minds tend to discount future benefits by about half, while giving full value to immediate gratification.

     As an example, suppose you were offered a free 15 minute massage right now or a free 20 minute massage 2 days from now.  Laibson’s research suggests that most people will opt for the immediate massage. 

     You can frame each offer numerically:  The immediate massage would equal x and the future massage would equal x/2.  So, the decision would be framed as 15 vs. 20/2; that is, our mental accounting give the immediate massage a “value” of 15 and the future massage a “value” of 10.

     It is easy to see that the people who want to start a business, but don’t, would rather have the immediate gratification of watching TV than the future gratification of being their own boss.

     Laibson also described how two different parts of the brain come to opposite conclusions about certain opportunities:
1. The cortex, the rational brain, weighs the future and immediate benefits equally.
2. The basal ganglia, the emotional brain, discounts altogether whatever rewards might exist in the uncertain future.

     The easy way to escape this vexing mental conflict is to procrastinate, hoping the need to choose will go away.  If you are planning to start a business take control of your situation and take action.  If you don’t do anything different today you’ll be in the same situation tomorrow.  It takes work, effort, and passing up immediate gratification to start a business.  

     People tend to find evidence to support their existing beliefs, and ignore evidence that goes against those beliefs.  Confirmation bias is what causes parents to ignore the fact that their teen is a derelict who drinks alcohol and focuses on the fact that their little angel attends church every Sunday.  It is the concept that causes the placebo effect – if you think it does then it does.  If you think a pill will help you focus your attention then it does and if you don’t take the pill you can’t focus as well.

     Knowing about the confirmation bias can help you as you craft your marketing campaigns because you can set your prospect’s beliefs and then supply the evidence to support these beliefs.  If you point some aspect out that normally goes unnoticed and label it as fantastic your customers will take notice.  If you have set their beliefs the customers will begin to look for evidence that support those beliefs.

     Here’s an example.  In the early 1900’s Claude Hopkins visited Schlitz where he was shown the beer making process.  The water came from 4,000-foot deep artesian wells, to guarantee its purity.  Special wood pulp filters took out all the impurities of the brewed beer.  Special rooms were filled with filtered air so that the beer could be cooled without impurities.  Pumps and pipes were cleaned twice daily to avoid contamination.  The glass beer bottles were even steam cleaned four times before being filled.

     Hopkins was fascinated by both the complexity and the quality of the standards involved in the process. He asked the Schlitz executives why they didn’t tell this story and their response was that all the other beer makers had a similar process.  Hopkins countered, “Yes, but the others have never told the story.”  Hopkins went on to create an advertising campaign that pointed these details out.  The brand went from 5th place to tied to first place in less than a year.

     Find aspects of your business, service, or product that you can point out, let confirmation bias take over, and let your customers' perceptions change.

     Whether you believe it is best to focus on your strengths or minimize your weaknesses doing a SWOT analysis on your business, a department, a product or a service can help you identify areas of improvement.

     The SWOT analysis tool helps you to identify your strengths, weaknesses, opportunities, and threats. 

• Strengths: These are generally within your control, such as 80% referral or repeat business, or a feature that is not provided by your competitors.  Find your strengths and then determine what needs to be done to keep these strengths.

• Weaknesses:  These are generally within your control too.  You should look at your weaknesses and determine if the cost of addressing the weakness is less than the return to the company when the weakness is fixed.  One business spent thousands of dollars to fix a weakness that only affected 3 marginal customers and thus had a negative ROI.

• Opportunities: These could be short-term or long-term.  Brainstorm the opportunities before you decide which ones to further develop.  Once you find ideas that will provide a positive impact determine what the ROI would be to bring these opportunities into existence in your business.

• Threats: These are things that generally outside of your control.  Identifying threats often leads to better product development (sometimes a new product), or to changed business strategies.

     A SWOT analysis can provide you with a lot of information.  And this information can help you improve any part of your business.

     What separates your business from your competitor?  If you’re smart its not price, but people.  I’ve seen businesses selling the exact same thing (it could be car washes, house cleaning, computer repairs, or even a product such as filtered water) and the single most important thing that distinguishes one business from the other is people.

     Here are five suggestions for getting the most out of your people factor:

1.  Find good people.  Find people who believe in your business and who like what they do.  People who just need a paycheck will eventually be indentured servants (meaning they have no where else to go and rely on you to keep them).  You actually want employees who have options to go elsewhere – they work for your business because they choose to.

2. Realize that your staff represents your business.  Your staff can be the differentiator between your business and you competitor’s business.  This difference is magnified when things do go well.  How your employees handle bad situations can really set your business apart from the competition.  Spend time training your employees to deliver the image and message you want.

3. Lavish praise.  Always look for the best in your employees.  Catch them doing something right and let them know that you noticed.  If an employee does something wrong don’t criticize.  Instead train and use the opportunity to foster employee development.

4. Don’t take yourself too seriously.  Have fun.  Laugh often.  Share your foibles and successes.  Allow your employees to have fun with you and to laugh with you.  Your customers will also be impressed with the atmosphere of fun and employees who enjoy work.

5. Work to accomplish not to be busy.  If everyone knows what needs to be done then most people are willing to work to accomplish the goal.  Don’t silo your employees into just their jobs.  Let them participate in the bigger picture of what the company’s goals are.  The more you share the more the employees can help you accomplish.

     “It’s all political around here.”  “You’ve got to play the game.”  We’ve all heard some version of those quotes.  Why do organizations have office politics and what, if anything, should be done about it?

     The traditional view of office politics is a culture of back-stabbing and alliance building.  Many managers, not knowing how to handle office politics, have changed the concept to a more positive concept: playing a game.  And in this game the players, employees, form alliances and manage the culture to get ahead.  Our society embraces this type of interaction so much that they leave the office and glue themselves to the television to watch reality shows where the same thing they despise at the
office unfolds on an island or some contained house with hidden cameras.

     Office politics occur when employees have limited input with the decision makers or when outputs and results can’t be measured, causing individuals uncertainty about their value to the organization.  This leads to insecurity, which in turn leads to self-protection but potentially damaging political behaviors.

     In addition to not practicing office politics yourself, you as a leader can help alleviate office politics by helping your employees to understand the movement and make up of the organizational culture – who makes decisions that affect them, how are those decisions made, when are those decisions made, and how they can influence those decisions.  Your culture needs to reward those employees who are team players because these people will sometimes take a hit personally if it is for the good of the team (not the political team, but the whole organization team).

Key Indicators that your organization has damaging office politics:
     • Staff spends too much time protecting themselves with e-mails and reports.
     • Too many meetings are devoted to dealing with internal issues instead of
        improving business operations.
     • Whining, complaining, undue caution, or passive-aggressive behavior by staff
        members.
     • Problems are never resolved or meetings are ended without making decisions
       and holding someone accountable.
     • Little cliques, which slow down the forward momentum of projects or
       the company.
     • Key information is “gated” by departments and individuals.

     B.F. Skinner was right – it is possible to make a pigeon superstitious.  Here’s how he did it.  He put a pigeon in a cage and arranged for food to appear at regular intervals.  Whatever the pigeon happens to be doing just as the food arrives – bobbing its head, scratching the floor – it will keep doing over and over again in the hopes that it will cause the food to appear.  The pigeon will assume a cause and effect relationship that doesn’t actually exist.

     Superstition is a compulsion to take an action that has no influence on the desired outcome.  

     Pigeons are superstitious, as are all of us.  You’ve met the person who believes that they have found the one and only truth, and they can’t fathom the thought of changing their old rules even in the face of new data.  Many of these people decide whether they like a new piece of information based on how it will affect their prior belief system, not based on whether it is actually true.

     When you meet a person who will disregard an obvious truth just because it will conflict with his current belief system you must wonder about his judgment.  What other data is this person willing to ignore in order to preserve his superstitions?

     I see many organizations which have built policies based on superstition.  Many of these organizations don’t want to change their policies even when the data suggests that the market has changed and it may never return to the way it was in the past.  Superstitious leaders in organizations enforce rigid adherence to a set of policies that they believe are responsible for their organization’s success, only to doom the organization.

     A pigeon won’t wise up and change its behavior, but you can.  You now know that this aversion to rational change has a name – superstition.   Don’t give into pigeon-minded superstition, speak up and point out the rational thought that needs to drive change.

 

    You’d never skip due diligence on an acquisition, so why trust your instinct on an investment as costly and important as your people?  If you’re like most people who have to hire your hiring plan is like a three-legged stool:  resume, experience, and gut.   In other words you trust the information on the resume, their job titles, and their personal presentation in the interview.  For such a serious decision many people take it so lightly.

     A bad hire affects your bottom line.  Turnover costs show up as:
          • Low productivity before the employee’s departure,
          • The cost of hiring a replacement – in dollars and time,
          • The cost of mistakes that might have been made by the employee,
          • The damaging effect turnover has on morale, and
          • Numerous other costs.

     What should you do rather than rely on your instinct?  The interview process should focus on how an applicant has handled experiences.  People’s past behavior is highly indicative of their future behavior.  You should be asking candidates to tell stories or give examples of actual events to uncover certain job skills, characteristics or behavior patterns.  

     To ask questions about behavior you will need to first create a list of competencies that the job will require.  Then you can build your behavioral questions around those competencies.  For example, if the job requires problem solving skills you might ask, “Tell me about a time when you had to analyze information and make a recommendation.  What was the thought process that you had to go through and what was the outcome?”

     It’s a pay now or pay later scenario.  Spend the time up front to be prepared to ask behavioral questions.  Learning how the candidate handled situations in the past will help you determine their fit for your future. 

     I recently sat in on a meeting with two very successful men.  I watched and listened as the conversation went back and forth between the two men.  It was a lively volley of ideas, challenges, and concerns.  Both were intent on getting their points across.  I observed.  

     As the conversation digressed from really important issues to mundane issues their arguments stayed intense.  As an observer I could see that some of the mundane issues weren’t really worth saying anything about.  The amount of effort to persuade the other person wasn’t really worth it.

     One of the common challenges that successful people have is a constant need to win.  When the issue is important, they want to win.  When the issue is mundane, they want to win.  When the issue isn’t worth the effort they still want to win.

     Research shows that the more we achieve the more we want to be right.  We start to rationalize that in order to be successful we had to be right more than the next guy.  This starts the cycle that causes us to want our position to prevail, no matter how trivial the issue. 
 
     The word “but” kept coming up in the conversation.  The word “but” simply means – you made your point but now here is mine.  When the word “but” keeps coming up on both sides of the conversation I know that rather than listening the time is spent preparing a rebuttal.  

     Communication only happens when we listen.  So, in the end both of these successful men spent their time pushing their own agenda, their own ideas, their own challenges, and their own concerns.  Neither one gained from the other.  

     For successful people it is difficult to listen to others without communicating either that they already know about it or that they know a better way.  Be confident about your expertise and stand up for what you believe in, but before you speak ask yourself if what you’re about to say worthwhile?  The higher up you go in an organization the more you need to let other people be winners and not make it about winning for yourself.  Don’t let your success get in the way of communicating.

When someone comes to you asking you to meet or beat a competitors price tell them,
“I have no quarrel with anyone who sells for less.  After all, they ought to know what their services are worth.” Or, “A bargain is not what you pay, it’s what you get for what you pay.”

     A friend came to me with a business problem and asked my advice.  He said he was competing with similar remodeling businesses and was not being as successful as he wanted to be in getting the jobs.

Here’s my advice:

Tell your customers that there are only three important variables in getting their jobs done:
     1. Fast,
     2. Good, and
     3. Inexpensive

Then tell them they can pick any two variables, but they can’t have all three.  Once they have selected the two variables they want then bid with those variables in mind. 

     The people you are selling to all have one thing in common, they are suffering from employment fatigue.  Employment fatigue is brought on by excessive workloads, 24/7 availability, pressure to do more with less, constant downsizings and reorganizations, and information overload.

     These are good people, doing their best, and trying to survive in this demanding workplace.  They are multi-tasking, although not very successfully.  They are trying to stay focused, but are interrupted by distractions and changing priorities.  Their calendars are overflowing because there is an unrelenting and escalating demand on their time.  Their frantic pace is exhausting.

     Their personal lives are not better.  They are juggling work commitments with family and personal time.  Their health is taking a backseat to the demands of life.

     To make matters worse, they don’t see an end in sight.  It is no wonder that these people don’t have time for you.

     Dealing with inundated and fatigued people is completely different from working with calm people who have time to analyze their options and study the various proposals before making a buying decision.   Traditional sales strategies don’t work.  Traditional sales strategies add to all the other distractions that are causing employment fatigue.

     If you are using traditional sales strategies then you have become one more thing to “get off their plate.”  Your prospects will want to get rid of you.  It’s not personal, it’s survival.

     We all know that proper selling is actually all about helping the client.  What you need to do is to simplify EVERYTHING - your presentation, the options, the research that needs to be done, the process to make the purchase.  The salesperson who will simplify everything will have a customer who will work with you.  These customers will rely on your advice and guidance to make their buying decision.

     What can you do to simplify the buying process for your customer?

 

     What makes a church-going soccer coach cross the line and commit fraud?  Why does the well-intended, hard-working sales manager fudge numbers at the end of the quarter? 

     Most people intend to be ethical on the job.  But studies by John Darley of Princeton University show that even those with scruples of steel will falter and make bad decisions when put in an environment that encourages them to do so.

     When it comes to why good people do bad things it turns out that your organizational culture is the deciding factor.  Take, for example, the culture where budgets are routinely exceeded, performance reviews are meaningless, and sales projections are never addressed once they have been made.  These cultures give people permission to make promises they don’t have to keep.  If the culture is “talk” only and no accountability then otherwise good people will sacrifice accuracy, quality, or integrity.

     In a 2003 study of 1,503 companies, the Ethics Resource Center found that when talk dominated action, misconduct soared.  But when top management walked the talk with their actions, misconduct plummeted.

     It is your culture that creates an environment where good people will make good decisions when placed in a position of conflict.  So if you want to create a culture to encourage your good people to do good things in difficult situations, then start at the top with your actions.

     An acquaintance found that one of his employees was secretly stealing from his business.  He said that this employee was taking more than the occasional pad of paper or stash of pens.  This employee was actually stealing money from the business.  My friend felt betrayed by the employee.  We talked about what could have been done to stop this thief.  Here is our list:

    • Require receipts for everything.  Having receipts for everything provides a 
        clear paper trail.
    • Never use a signature stamp.  Leaving a signature stamp around the office is 
        like handing over your checkbook to a thief with all the checks signed.
    • Open all business mail yourself.  Opening all your business mail enables 
        you to see all the checks that are coming in and need depositing. 
    • Don’t allow the person preparing the deposit to make the deposit.  If the 
        same person who creates the deposit makes the deposit it is too easy to 
        change the deposit slip amount and pocket the difference.  The only record
        of the deposit is the bank’s receipt.  
    • Make random inspections.  Once a month check your office supplies and
        stock.  Does it seem like a lot of printer toner is being used?  You don’t
        need to check everything, but your employees need to know you’re lurking.
    • Interact with your employees.  Get to know your employees.  It is harder
        for people to justify stealing from the company if they know you care 
        about them.
    • Define “stealing.”  Your definition of stealing might be different than that 
        of your employees.  Do you consider surfing the internet or making 
        personal calls “stealing work-time?”  Do you consider taking home office 
        supplies for an employee’s children to use in school stealing?  If so, you 
        need to let your employees know your definition of stealing.

     Your employees don’t make the same amount of money that you do.  Some rationalize their theft because of the fact that you, as the business owner, make so much money that you should share your wealth with them.  When an employee thinks that pocketing $20 from the company is no big deal this employee fails to realize that $20 a week multiplied by 52 weeks over a 3 year period amounts to almost $3,000.

     Implementing these ideas can help prevent theft and just might keep a good employee honest.