Is determining the best price a problem? Photo by luz from flickr

Are you having trouble determining how to set the best price for your products or services? That seems to be a common problem for owners of independent businesses.

Do it right and customers will be content, happy to pay you what you deserve, and you’ll be around. Do it wrong and you won’t. It’s that simple.

The best pricing system takes these 8 items into consideration:

1. True total costs
2. Profit
3. Contingency
4. Overhead
5. Payback for investment
6. Positioning
7. Value
8. Time

You may think you know what each of these mean.  See if you do and if you agree with me.

Does Your Best Price Include Your True Total Costs?

These are all the costs that you have spent or will spend on getting ready to offer this particular product or service. Seems easy. But it’s easy to think you’ve only spend $10K and discover it’s closer to $60K. Especially if you’re used to throwing receipts in an old shoe box.

The easy costs to account for are research and development. But we’re also talking about vision and planning costs, preparation, training, pre-launch marketing expenses, legal, administrative help and the costs to find the right people, insurance, etc. There’s also a part of overhead that was and is used for getting this product or service out the door that is part of the true total costs.

Your list of true total costs will probably be longer and larger than you thought. Make sure you don’t miss anything.

What’s the Right Profit Level?

Too little profit and it can be hardly worth doing except maybe for credentials or experience. Too much and it can seem like gouging. Owners become so concerned about being “fair” that they forget what profit is used for. It’s is what you use to keep up your quality and grow. You’ve gotta have it.

You can punt and see what the “industry standard” is or what competitors are doing. Neither of these may be right or reflect your situation but they are a good place to start or finish. It’s one of the hardest things to determine.

What’s the Right Contingency Amount to Include?

What is it about contingency? You’re never going to make a mistake and have to redo something, right?  Those are just a few big reasons to have a contingency amount also built in to your pricing. That amount is usually based on your historical experience with this product or service or these type of clients. And, yes, you can legally charge different clients different amounts. Just be careful and research this area first.

You Know about Overhead; So, Include It

Who pays for your overhead? Your customer needs to pay their share so you can keep providing them what they need and want. You should know what it costs to run the business on a monthly/yearly basis. You should include a portion of it in every sale.

How much? That depends on how many sales you plan for. We had a laboratory and testing client that only had six potential customers worldwide. Not many customers but a lot of sales per customer. The overhead amount was based on those two facts.

Your Price Needs to Pay You for Your Investment

One of the reasons owners under-value and under-price is that they discount the risk they took in starting this business and offering these products and services. Your price should include some amount that accounts for the risk you took and the ongoing risk you take.

Price for Now and the Future Based on Positioning and the Value You Provide

Low ball your price now and you can’t pay for anything later and you probably won’t be around.

Pricing for positioning means deciding what you want customers to think of you: discount? low-priced? average? high-priced/luxury/high quality? Use that image to arrive at a final best price.

The same is true of value. What value do you bring that no other product or service can? This is your uniqueness. It also goes into setting the best price.

Is Time Missing from Your Pricing?

Research, planning, implementing, evaluating and upgrading all take time and that costs your business. Don’t leave out these for your employees or for YOU! We see this way to often.

Add these Up to Get Your Best Price

All that’s left is to add these up to arrive at the best price and the right price. Once you do, remember to review your pricing at least quarterly. It’s not set in concrete although you do want it to be consistent over time. Things change. Don’t get caught with 1990′s pricing unless you’re doing that purposefully and can afford it.

What you want is “Pricing Power”!

One definition for this term is the effect that a change in a firm’s product price has on the quantity demanded for that product. Pricing power also ties in with the “Price Elasticity of Demand.” Without this power, you really can’t increase your prices so be sure to focus on the benefits your company and products and service provide that are valuable to your Platinum Profile Customers™.

Also check out my post on Legacy Pricing™.

What’s your pricing system based on? Do you feel you arrived at the best price for your company and your customers?

The Problem

It’s not writer’s block. I can handle that. Here’s my dilemma: too much to do at the same time and no time to write posts or finish posts I start. I want to write but I really need to:

1. Renegotiate the office lease.
2. Entertain several set of out-of-towners, family members and friends who want to see our spectacular Texas wild flowers, celebrate birthdays, see me. I also need to host several business events and meetups.
3. Make presentations and attend other training sessions.
4. Talk to prospects, potential allies, media, and government officials.
5. Work with new clients on their overall vision, positioning, marketing plan and develop a workable sales process with them. Some are startups who need to work through and create financials. Two are expanding.
6. Maintain the progress of existing clients: a landscaper, asset manager, two software developers, and a security company. Keep in contact with former clients who are working on projects we put in place: an architect, 2 environmental firms, and others.
7. Volunteer.

Not Schubert, but like me, this piece has a lot going on. Photo by pfly from flickr

When can I squeeze in writing posts when I have other things to do? Maybe that’s why, like Franz Schubert, I have unfinished works.

Here’s what I’ve tried:

a. Time management and delegating. That helped but too many variables right now to do it right.
b. Setting up an editorial calendar so I could write as planned. Got the calendar but got interrupted.
c. Multi-tasking. I always thought I could multi-task until I learned that the brain does not work that way. We  just think we can do several tasks at once.
d. Not sleeping. I have pre-thought out the posts that come to me at 3am. Wish I could harness that and they could magically appear.

(I wonder if Schubert tried any of the above. He certainly knew how to write.)

Composer Franz Schubert

And, this is what brings me to my search for a solution. I know from my research on small business that in addition to being the job creation engine, paying 60% of the taxes, we are dollar per dollar more innovative than big businesses. After all, we created the zipper, the airplane, and contact lenses. How hard could this be?

The Solution

I appeal to those of you who are inventors, creatives or problem solvers. I need your help.

Here is what I want and what I am willing to pay for: a mechanism (electronic or other) that pulls out of my brain (without disturbing me from the other things I am doing) the great posts I have formed in my head.

Your solution must write posts AND:

1. Put in all the tags, categories, links, etc.
2. Create the Custom Title Tag, Meta Description, Meta Keywords.
3. Find a grabbing graphic, get permission to use it or create it new, size and put it in place — with a killer caption.
4. Proofread and edit the copy verifying the accuracy of the information while making sure it is in keeping with my “style”.
5. Create interest in the post, get comments, get people twittering about it.
6. Allow me to do all of the other things I need to and want to do.

But, I don’t really want a copywriter. I like to write.

Hoping patiently to hear from you asap because my MUST DO list keeps getting longer. Alternatively, I’d be happy to commiserate on your post-writing problems. Misery loves company as they say.

Thank you.

Role-playing dice are like the role-playing CFO whose job includes improving the sales system. Photo by cal_harding from flickr.

What can a CFO do to improve the company’s sales system? What do they even know about sales?  You’d be surprised.

If you’re the CFO and CEO, the following applies to you. If you’re both of these plus the Director of Sales and maybe even the Chief Salesperson, you still need to include the tasks below in order to improve the results of your sales system.

The CFO’s Role in the Sales System

You may never have thought the CFO a has sales role to play. I think they do and it gets proved to me again and again.

I’m about to present my “Marketing for Growth” workshop. When you get beyond the basics of marketing techniques, it’s all about the numbers. That’s what I will be talking about at my session to get owners thinking about more than facebook® and Twitter® or blog posts. Sales efforts with no numbers to back up the time and costs incurred is no sales efforts in my book.

I happen to have a marketing and sales background, ran a full service advertising firm with Jan Triplett, and taught the marketing workshop for the SBA for years. But, even if you’re strictly all about dollars and sense, the marketing and sales department needs you.

Here’s what you bring:

• A No Nonsense look at the sales figures.
• A need and vital use for tracking costs and results.
• No love for any particular sales technique or system. Social media or traditional media , it doesn’t matter as long as the sales projections you were given to go on for planning or budgeting turn out to be reasonably accurate.
• No tolerance for excuses or wishful thinking. That may sound harsh but excuses and wishes don’t pay the bills.

Here’s what you want:

• Accurate reports on sales status for analysis and creation of sales and financial projectins. These must include aging time of each prospect and number of contacts needed to get the sale or to cull the lead.
• Consistency for planning purposes.
• Replicability for growth and profitability purposes.

The CFO’s Sales System Goal

The CFO’s goal is to make sure everyone does what’s necessary to improve the company’s sales system. These include validating that:

1. Staff are using assets appropriately. It requires that they leverage existing and previous customers to find additional sales, up-sell, re-sell, and get quality referrals that improve sales in the long and short term.
2. There is a written system for tracking results that everyone uses. Salespeople like to be hip shooters and creative. They don’t like to be told what to say or when to say it. But there are some “MUST” questions that need to be answered on every suspect, prospect, former and existing customer. You can’t (nor can the head of sales) waste time tracking information down to determine what the monthly and quarterly sales dollars are going to be.
3. There is a written system for getting business intelligence out of the heads of sales, customer service and others who interact with customers. This is often an overlooked asset that is frequently downplayed or ignored when the focus is only on making the numbers of calls or contacts. That information can be used for planning and budget purposes for adding or deleting products and services, expansion potential, funding etc.

These demands and system requirements can make you unpopular but someone has to do it. If there’s a director of sales, they’ll be glad to have you play an important sales role. It’s all part of taking an advanced perspective on your sales system.

Don’t make the excuse that you know nothing about sales. You do. You may just never have thought about it that way.

Are you up to the role? What are your hesitations?

Measure sales carefully to be profitable.

Your sales projection formula is key to more accurate financial projections and to the success of your business.

Sales projection formulas are always wrong. Here are six ways to improve them.

Sales projection formulas are wrong because…

1. Sales projections are not supposed to be right.
   They’re a snapshot of what to expect each month based on relevant criteria and are defensible. Improve the sakes projection formula you use by making sure you don’t accept the projected sales numbers without question. The answers you get from salespeople in terms of what they think will close have to be reasonable and with some sort of basis not just hope.
2. Sales people hate to do sales projections.
   They may be able to withstand a lot of “No’s” but like everyone they hate to be wrong. They don’t like to give you their sales projections because they hate to be pinned down, they consider them to be a “guess”, and they know they’ll be wrong. Something will happen to change the numbers. When you ask them to say what sales will close in what amounts, they always hedge their bets.That’s sort of ok. You must make sure your sales formula includes going back and see if they were right or if the percentage of their guesses were acceptable. That will tell you a lot. If they’re really off base, you can’t trust them and you need to do something. Of course, you can build in a “fudge factor” into your sales projection formula. That means basically taking their prediction and cutting it in half or more.
3. Sales projections are usually isolated from overhead costs.
   Although costs appear in your financial projections, it’s always important to keep the two together. It gives a false sense of profitability when you don’t see what you get to keep after subtracting your costs. This can also lead you and your salespeople to go after every sale instead of letting unprofitable ones go and concentrating on the sales with Platinum Profile™ customers. Share this part of your sales projection formula with your salespeople.
4. Sales projections are done once and forgotten.
   Most sales projections formulas don’t seem to include historical analysis. They’re usually not compared to similar sales situations from previous years or similar customers. It’s true projections can’t be set in stone but they can’t be just based on “feelings” and “intuition” either.Analyzing them gives Owners and Sales Managers a gauge on how their part of the economy is doing long before economists see it. We’ve been through seven downturns and by looking critically at sales projections from previous years and the same or similar clients, we knew the last downturn was coming two years before it was announced.
5. Sales projection formulas don’t always deal with “Cost of Goods” or “Cost of Services”.
   They don’t usually even mention costs to find, attract, deliver, support and retain customers. Make sure the costs you identify and track are reflective of all your costs and are part of your formula. Also make sure your salespeople are considering those costs when they are making deals and arriving at pricing.
6. Sales projections don’t break down sales into SBUs, strategic business units, in enough detail. Salespeople need to know what to suggestively sale or they will leave money on the table. When they don’t discuss ways to make the solution stronger with suggestions, the customer is cheated. They won’t feel that they’re getting a total solution that’s been thought through with enough attention to their needs. Research shows people like ideas to make their purchases better (even if they don’t always use them or say anything.)What can management and sales learn from looking at what SBUs have the most value? A lot.  Seasonality. Stock up rates. All kinds of things that can help upsell or resell customers. They can also tell your salespeople what to drop or at least not push.

Recommended questions to ask about every sale to improve your sales projection formula

• Why will this sale go through?
• Why will they buy now?
• How is this similar or different to sales in the past?
• What marketing or sales efforts contributed to this?  We recommend a Platinum Profile Customer™ 7-step sales process.
• What do we need to do to close the deal and make these projections more accurate? Does it set a precedent? Is this going to be a policy?

What else can you do to improve your sales projection formula?

Business Success Center CFO Daniel Diener developed a unique sales and financial projections spreadsheet. It brings all the information about costs and revenue together on one sheet. If you don’t have something that brings these key parts together, you need to get one or make one.

We’ve used ours with businesses of all sizes and all industries. It works and it’s easy to get a 40,000 foot owners view of what’s going on. If you’d like to know more, please contact Daniel.

Then you need to look at it and change it each month to reflect last month’s realities. How far off were you? What do you need to change to make this snapshot more realistic in the future and more useful? This effort makes sense especially if you have salespeople who hate numbers and being pinned down.

Photo by Bill Brooks

Positive Conflict™ requires thinking outside the box. Illustration by Mamadob

Conflict is valuable in the workplace. In fact, it’s actually good for business.

You might not have thought of it as being positive but it can be when people use care with each other and stakeholders. They also have to put something like the BSC’s Fight Fair™ strategy  in place.

I just had the opportunity to spend two days working with the staff of an Inc 5000 company on improving their communication. This is a high quality small business but staff members and the owner wanted to make sure they were dealing effectively with the internal and external conflicts that come up in every business.

The first thing I did was ask them to complete a survey to get their opinion of conflict. It was interesting to see that almost none of them thought of it as being positive. However in the work session, they got it and they saw it first hand as we worked through various scenarios that they deal with when working together or working with customers and other stakeholders.

Conflict’s Origin Suggests Its Potential Threat AND Value

Conflict comes from the word “conflictus” which means “striking together”. There are many times that objects striking together result in something good. A drumstick striking a drum makes music. A flint striking another piece of flint creates sparks and fire. A bell clapper striking a bell tells the time.

7 Ways Positive Conflict™ is Key to Business Success

The staff came to recognize the value of conflict when they experienced it without the potential of personal threat, insult, or put down. That’s “Positive Conflict” and it builds on itself. It happens in internal (within the organization) and external (with customers and other stakeholders) conflict situations. With Positive Conflict™:

1. Ideas are more valuable and better because they are challenged.
2. The challenge becomes a valuable learning tool for the individual to think and work more consciously.
3. The group learns to trust one another because they have been through the conflict.
4. The share experience gives everyone the opportunity for growth and makes for better teams.
5. Those teams make better cross department allies since they know how to “fight fair”.
6. Because they “fight fair” they have good feelings about themselves and others.
7. Their sense of pride and accomplishment of improving ideas through positive conflict™ reduces the amount of negative or destructive conflict that occurs.

The next time you think conflict has no place in the workplace, think again. What would it be like if everyone always agreed to everything and then the company acted on that? Lots of businesses could irreparably harm themselves or others. Does your business encourage the right kind of conflict and the right way to manage it?

If you have conflict that’s negative, check out available resources at Conflict Resolution Network out of Australia. They have some good information.

Put your 1st quarter financials to get higher profitability going forward. Image by Photosteve101 under a creative commons license from flickr.com

The true value of 1^st quarter financials goes way beyond just the raw numbers. Because of that, your monthly close out is more important and there are do’s and don’ts that are unique to this quarter.

Completing the prioritized tasks gives the owner or manager a perfect opportunity to refine their vision for the year. Using the resulting information can make the last three quarters more productive and more profitable. This will keep you out of the weeds and create the 40,000 foot owner/investor perspective you need to make a better future.

Do’s & Don’ts of Closing Out 1st Quarter Financials

1. Don’t just make sure everything balances.
   Do look to see how close it matches your income and cost projections. Then make adjustments to the next three quarters projections.
2. Don’t just look to see what sold.
   Do understand why. Go back to customers to see how things are going. You might pick up some extra sales or some ideas of what to add, change or drop in the 2^nd quarter.
3. Don’t just accept the cost figures your accounting system tells you.
   Do drill down and see where there might be savings. Talk to your people who make the products or provide the services. What ideas do they have for the rest of the year? Reward the best ones. Begin implementing those ideas next quarter to give yourself plenty of time to meet goals.
4. Don’t just accept that the staff is doing the job right.
   Do see how you can cross-train at least some of them. Do try to give them leadership experience. Do it right and you might double your profits. You’ll already be prepared for any opportunities or threats that come along. You’ll be quicker than your competition with less effort and better results.
5. Don’t just look at what you did financially 1st quarter last year or the last quarter of last year.
   Do look at what’s changed and what’s on the horizon. There are five challenges to consider each quarter (maybe even monthly). Those are: economic, technological, environmental, social, and regulatory. Get a jump-start on them by identifying them specifically and setting processes in place to mitigate them or take advantage of them.
6. Don’t think you have limited resources to make changes.
   Do look at your strategic alliances and engage with them for insights and new opportunities. See whom you need to add. Go get them. If you haven’t got alliances or planned for any, see how you might begin to set those up. There’s more value in working with others than being a lone wolf.
7. Don’t just make sure you’re in compliance.
   Do see how to make that compliance easier and quicker to complete. Investigate some add-ons to your accounting system. Make sure it provides for cost accounting as well as a good time collection system. Check out the Journyx products for instance.

Partner or Strategic Business Alliance? Photo by Giorgio Montersino

Partner or a strategic alliance — which is better for business growth? Many business owners want a “partner” to  share the load. Partners exert a lot of control no matter how little of the business they own. Use a strategic alliance instead to grow your business and  keep more control.

What is a Strategic Alliance?

In 2005, companies reported that 18% of their revenue was generated through strategic alliances. The economy has changed but there are still thousands of alliances formed each year.

I agree with Winston Churchill. “If we are together, nothing is impossible. If we are divided all will fail.”

Kinds of Strategic Alliances

“Walking with a friend in the dark is better than walking alone in the light. . .Alone we can do so little; together we can do so much.” Helen Keller

I have found at least seven different basic forms a strategic alliance can take. These are:

1. Friendship
2. Networking for career purposes
3. Cross marketing ally
4. Cooperative advertising ally
5. Shared production or operations expense ally
6. Joint Venture
7. Funding ally

Any strategic alliance can be:

• Temporary or permanent
• Long term, short term, one time event, trial
• Vertical (between a vendor & a customer, competitors, two or more businesses) or horizontal (between employees, supervisors, managers, departments)
• Local or global

Some strategic alliances have legal requirements. Those formed to share expenses and joint venture alliances certainly should not be even considered without some sort of written agreement. In a joint venture, a new business entity is formed. It requires a legal document to set down how this will be run, who’s in control, and how to handle income, expenses, and liability among other things.

Funding strategic alliances are created by agreements with angels or venture capitalists most often. Other potential allies include grant providers, customers, prospects or even the government.

Successful strategic alliance: California Milk Board & Oreo® cookies by NABISCO

Any marketing alliance will need written clarification to make sure everyone understands and agrees. Are you and your ally going to share out of pocket marketing expenses? Who pays what?  Think of the Oreo cookies and Milk Board and their “Got milk?” campaign. The billing for the ads and the paperwork to create this strategic alliance must be very interesting.

Commonalities

“The truth we’re seeing in markets around the globe, the more you share, the more you win.” Brian Featherstonhaugh Chairman and CEO of OgilvieOne Worldwide

All strategic alliances share three common elements:

• Goals — who wants what
• Responsibilities — who does what
• Rules — how it’s done (based on business and personal culture and  attitudes)

But the perspective of each is different. A strategic alliance whose goal is just to find a friend to talk to or to network with has a very personal goal. Cross marketing, shared production expense, and joint venture alliances are more business growth focused.

Any alliance has expectations. One primary that they all share is reciprocity. The goal of each alliance is to add value and worth to each person or entity involved. Not only is “No man an island” but no business can  survive alone either.

The Right Strategic Alliances

“We cannot enter into alliances until we are acquainted with the designs of our neighbors.” from The Art of War by Sun Tzu

What’s the right alliance for you?  The strategic alliance that matches:

• Your goals
  Either short term or long term
• Responsibilities you and each ally are willing to take on
  The more complicated the alliance, the more the responsibilities of each party. The joint venture because of its legal nature is the most complex.
• Rules you are willing to abide by
  There are plenty of rules that apply to alliances. If you are going to try to win a government contract, for instance, there are special rules you have to follow if you and another business are pooling your resources to fulfill a contract.

How to use strategic alliances

• Production:
  Achieve advantages of scale, scope & speed; enhance product development; –diversify; skill building; share expertise
• Marketing
  Increase market penetration; expand market development; keep competitors out
• Sales
  Enhance competitiveness in domestic &/or global markets; Develop new business opportunities through new products & services; Increase exports
• Finance
  Create new businesses; –reduce costs

Successful Alliances

To be successful:

• Set reasonable, realistic goals
• Choose the right kind of alliance
• Know the rules
• Select the right allies
• Work the alliance
• Measure results regularly
• Have a way out (transfer, transform, exit) and a contingency plan

Shaking hands, a universal symbol for alliances. Photo by Leo Gruber.

We call this the Handshake Alliance Strategy™. We use it and teach it to our clients at the Business Success Center and at trade association conferences. It works. But it is work; sometimes even a struggle.

Top successful alliances added $72 Billion in shareholder value over 2 years. Bad alliances cost companies $43 Billion. (Harvard/Accenture study 2003)

Handshake Strategy ebook by Jan Triplett on the process for creating and maintaining successful strategic alliances.

Alliances aren’t perfect but they can be a lot better (and safer) than a partnership.

I’m finishing my ebook, Handshake Strategies: How to Grow Your Business or Career. What are your experiences? I’d love to add them to my examples.

Bright idea: make more money by hiring a Virtual Sales Manager Photo by EJ Posselius

Does replacing yourself as the salesperson sound ideal? If you hate to sell, maybe you’ve thought about hiring someone to do sales for you. Maybe you don’t want to have just an employee. Maybe you’re looking for a Virtual Sales Manager to manage the whole process and help sell.

They do exist. I do it for some of my clients. Not all of them are one person operations either!

How do you make sure they’re the right person or you’re hiring the right company? Be careful!

7 Questions to Answer Before Hiring

1. Are you really ready to give away that control? That can be scary. How much authority do you want to give them or allow them to take? You’re delegating; not abdicating. Ultimately, do you want to bring this in house? How can they help prepare you so you don’t start over? Make them demonstrate this to you through referrals to happy customers.
2. Do you have what they need to sell for you? Pricing strategy, marketing materials, clear benefits, concise information on preferred Platinum Profile Prospect™ you’re looking for and Radio Active Waste Customers™ to avoid, are just a few of those items. If you don’t, either you have to create this or they do. You’ll need more money and more time.
3. Do you product and can you take the time to train them on its strengths and weaknesses? You can lose weeks of important selling time if you’re not ready internally.
4. Do you know how much more sales you can handle and when it will be too much? You think you’ll have time to ramp up. You won’t. You have to have a ramp up plan with the money to support it ready to go.
5. Have you checked your pricing to make sure you can afford someone of the quality you need? Be sure you know your true total costs, have built in an amount for contingency, and have a profitability percentage built in also.
6. What do you really want from them? That means having a vendor job description. It won’t look exactly like one for internal staff but it spells out for you and them the commitment you expect. This then goes into an agreement you both sign.
7. How are you going to incorporate them into your business and processes? They can’t operate in a vacuum. You need good communication between you and you need to respond to them as soon as possible. If you’re not prepared for weekly meetings, this is not for you. They are going to ask you to make changes. Are you willing?

Do you know a boss who talks too much? Artwork by Matt Devicious.

Bosses who talk too much or blab hurt their businesses more than any cyber security leak ever could. The results can be disruptive enough to kill sales, drive away staff, or potentially kill the company.

They can also be harder to stop because frequently the boss doesn’t realize they’re doing it.

Big Mouth Examples

Here are seven of the worst blabbermouths and what happened (or could have happened) to their businesses.

• Sharing Secrets

The food manufacturer responded to a simple question by someone she just met by revealing her secret way to solve a major production problem. She was too proud of what the company had done to keep quiet about it. Good product but the idea of protecting trade secrets was foreign to her.

• Give Away

The hardware manufacturer that kept giving away product and prototypes to his friends to use. No one knew where the inventory was or what was being copied. His business went under.

• Double Give Away

The same manufacturer also was notorious for giving “friend of X” pricing.  He didn’t even do it consistently. That would at least have meant it was predictable and the CFO could have dealt with it. It drove the Sales Manager crazy because she’d quote one price and “the friend” would tell her that the boss said it would be less. She finally quit from frustration just before a big national trade show.

• Emotional Dumping

The service company had legitimate complaints about suppliers. In public meetings, the boss kept sharing them with his customers. He drove people away because they no longer believed in the product or the company.

• Gloom and Doom

The world and what happens in it isn’t always right. Being politically active and engaged is important. But it can be too much. The owner who is too vocal all the time raises other questions. Stakeholders and customers can feel that the company is more concerned about politics than producing a good product and serving their needs.

Open Mouth, Insert Foot Up to the Knee

These next examples of “dangerspeak” are probably more familiar, especially to almost any Human Resource manager:

• Bad Employee Speak

Talking, texting, or emailing people in or out of the company about fired or suspended employees in ways that are negative opinions but not facts. The courts have judged this to be defamation and charged the company and the perpetrator large fines (Gambardella v. Apple Health Care Inc.) http://www.employeerightspost.com/2009/05/articles/defamation/a-simple-case-of-defamation/. Also read: http://www.weil.com/news/pubdetail.aspx?pub=8737

• Wrong Employee Speak

Talking, texting, or emailing people in and out of the company about employees in a suggestive way or in a way that would be offensive. Employees who’ve quit over this frequently win healthy harassment judgments (Harris v. Forklift Systems). http://www.aauw.org/act/laf/library/workplaceharassmentcases.cfm

I’m sure there are more that should be added to this list.

What can you do?

1. Knowing what to watch out for is a simple way to start. Add to this list or refine it to suit what you see happening or what has happened.
2. Put a process in place to prevent it from happening.

If you’re the boss, watch what you say. If you can’t control it, get an independent ear and eye to listen to you before you give that speech or read what you send out before it goes out. You may have to go to the effort to get someone else to compose it using your concepts. It’s worth it to protect your company.

If you’re the boss of such a person, try counseling and training them. Put checks in place. Last resort: replace them or move them to some position where they can do less harm.

If you work for such a boss, there may be little you can do but look for another job because this business isn’t going anywhere.

As Walt Kelly’s cartoon character Pogo said to Porky, “We have met the enemy and he is us.”

It’s financed under the U.S. Department of Housing & Urban Development  (HUD) Section 108 Loan Program in association with the U.S Small Business Administration, private banks and credit unions. The funds are to benefit businesses and people who fit the profile of “HCU”, hard-core unemployed.

Austin got its $8 million in HUD loan guarantees in May 2012. Kevin Johns, Director of Economic Growth and Redevelopment Services at the City of Austin, manages the loan guarantee program. He’s out there encouraging its use by the business community. This is definitely worth considering if you’re growing your business.

Would you hire him?
Photo by philcampbell from flickr.com

 Its Stated Mission

“The Mission of the City of Austin Section 108 Family Business Loan Program is to enable existing family owned small businesses and in the micro loan section of the program to provide existing family owned small businesses or start up businesses to implement business ventures that will create jobs, revitalize communities, increase the tax base of the City, and enhance the overall quality of life for all City of Austin residents. It is designed to leverage 108 funds with SBA 504 funds and funds from a Private Bank and/or Credit Union.”

http://portal.hud.gov/hudportal/HUD?src=/states/texas/news/HUDNo.2012-03-01

Potential hidden employee gem.
Photo by erix! from flickr.com

HCU Gems Walk Among Us

Owners may be reluctant take advantage of these funds because of their concerns about hiring those with a disability, the long term unemployed, homeless, or those just out of prison. But there are overlooked gems out there that are well worth the effort it takes to find and hire them.

NPR’s Morning Edition just reported on one case of overlooked potential. This man was homeless, unkept, had been beaten up and robbed numerous times. A doctor who took care of his injuries also took the time to ask him his story. He learned he was treating and talking to Mike Williams, the inventor of the first intra-oral camera, former millionaire, husband, and father. Dr. Jong Chen thought this was a great waste of great talent and found a way to give Williams another chance. He got him out of the homeless shelter and back on his feet. Since that encounter, they have teamed up to create a business that manufactures a self contained survival pod for the homeless. Other potential uses include emergency housing or a short term rental for those stuck in extended layovers in airports.

Katherine Roberts was another hidden gem. This remarkable Austin woman (by way of Kentucky) was once a horse trainer and a country western singer who opened for Lee Greenwood (“Proud to be an American”). After falling on hard times, she came to get help and stayed to give help to others. In addition to helping people in need get bus passes and groceries, answer phones, and more she was the first to give a big hug, a warm smile, and a funny one-line welcome to everyone she met. Frequently in pain, she never complained. She had only a little money to give but she gave it freely. A diamond in disguise, she was with us for much too short a time.

Neither of these people were found using the HUD Section 108 funds. But, they are examples of what you might be dismissing and why maybe you should consider using this as an incentive to find other gems. They are out there.

Humor in Opportunity Seeker
Photo by quinn.anya from flickr.com

Family Business Loan Eligibility

Don’t just blow this off. Really think seriously about it.

This human treasure has huge returns and the Family Business Loan may be able to get you started. You can use it for working capital, machinery and equipment, or renovation, acquisition of land, new construction — almost anything that leads to job creation.

To be eligible for the loan, the business has to:

• Show it offered 51% of its new jobs to low and moderate income residents in the City of Austin; or that it’s located in a census tract having a poverty rate of 20% or higher (HUD Presumption Rule).
• Have been in the retail, industrial or distribution business for at least two years and been sufficiently profitable.
• Meet the size standards of the U.S. Small Business Administration and be a closely held entity.
• Must be a sole proprietorship (Micro loan applicant only) or any other legally organized private sector business registered with the State of Texas.

Hiring Loan Guarantee Amount

The maximum loan amount for any given project is 40% of the total project cost or up to $1,000,000; whichever is lower. Terms of the loan range from 10 to 20 years.

The applicant must be willing to commit 10% of the total project cost as a minimum and prove that this amount is available.

When you need a superhero.
Photo by badlyricpolice from flickr.com

Reach Out, Don’t Pass By

In my years in business, I’ve hired people who want off welfare or to stay out of it completely. I’ve hired people with disabilities. I’m so glad that I made the effort to find these wonderful people. They gave and continue to give me so much.

Put aside your preconceptions and judgements.  Find your own hidden gems. Give them a second chance and you will be rewarded many times over.

Like the Good Samaritan, we can use our resources to help others and not lose out.

What are your experiences with hiring people that others overlooked?