The Effects of High Unemployment

By Peter DeHaan

Author Peter DeHaanTen years ago, the unemployment rate was running high. Businesses needing to hire found themselves in a “buyer’s market.” This was what I wrote back then:

There are plenty of people looking for work. This results in more applicants to pick from for each opening. High unemployment has also served to limit employment options, thereby reducing worker mobility. The result is that employee churn rates are—or at least should be—decreasing. Having more applicants to pick from and fewer staff leaving by choice should be indicative of stable work forces. Unfortunately, this may not be the case and even if it is, it affords a false security.

Consider the following employees. Although their names have been changed and some details obscured, all describe the true plights of real people: With downsizing, layoffs, hiring freezes, employees have been stretched and pushed to a near breaking point. Click To Tweet

Chuck worked in a small satellite office of a large organization. The staff in his office were close and worked together well. They cared for each other and were like family. They helped each other to complete their work and serve clients, regardless of job description and title. Sadly, this idyllic reality ended when corporate closed Chuck’s office to save money. Some people were let go, but Chuck was told that he could work remotely from home. Then Chuck got a new boss, who rescinded that promise. Chuck now commutes 120 miles each day to work. The corporate office is nothing like his old office. Teamwork has been replaced by finger-pointing and blindly following job descriptions; no one cares about the clients—or about each other. One by one, Chuck’s coworkers have quit or are being let go. He fears he is next and is frantically looking for comparable work closer to home.

Carly is a college graduate whose chosen profession currently has a 40 percent unemployment rate. Unable to find work, she went to grad school. Her summer employment offered her a full-time position when she graduated but has been frustratingly vague on the details (right now she is relegated to computer work no one else wants to do). Unfortunately, this job is not in her field of study, nor does it interest her. However, out of necessity, she may be forced to take this job. Even if she does, she doesn’t expect to remain long.

Danielle also recently graduated from college. Her college internship continued after graduation, with the promise of a promotion when the economy turned around. She is now doing the work she was trained for—but without the title, recognition, or pay. This has been going on for a year. Although she is now working full-time, it is at her part-time hourly internship rate—or 40 percent of what is typical. She has polished her resume and is looking for better paying alternatives.

Karl has a full-time job in his chosen profession. At first, he liked his company and earned stellar reviews. However, in his latest review, he scored the lowest in each category. Last year, after their busy season, a coworker was abruptly fired. Karl fears that this year he will get the axe as soon as the seasonal peak is over. He is salaried and was initially told to expect working an additional twenty-five hours a week during the busy season. However, his employers recently tacked on an additional ten hours. He desperately wants to find a new job but has no time to pursue it. As soon as things slow down, he will begin his job hunt in earnest.

Larry greatly enjoyed working in his chosen career, finding it rewarding and fulfilling. However, after a planned move out-of-state, he was unable to find work at his level of experience and education. He eventually acquiesced to a much lower position at less than half the pay. The company promotes from within, so he hoped that he would eventually move into a position matching his skills and have his compensation level restored. Unfortunately, because he was performing a low-level position, he was looked down upon and demeaned by those who should have been his peers, in spite of the fact that he had more experience than some of them. The circumstances became so dreadful that he left, taking an even further pay cut in the hopes of finding a nicer place to work. Once again, he has the expectation to be promoted and, although feedback on his performance is very favorable, there are no current openings, so he could find himself repeating the process.

These people share two common characteristics. First, they do not like their employers or their jobs. Some have been lied to, others have been treated badly, two are significantly underpaid, and all are unhappy. The other commonality is that each of them desperately wants a different job and is working to make it happen. Since they have stellar qualifications and employable skills, their job expectations are not unreasonable. When the economy turns around, they are sure to find better work.

From this we can interpolate that:

  • Employees are unhappy, but they continue to endure difficult work situations—for now.
  • Many people are underemployed; they will correct that as soon as companies start hiring again.
  • Some people are working outside their fields of expertise. For many, this is not a choice but a short-term necessity.
  • When an entry-level employee sticks around after graduation, it may not mean that they like the company, but that there aren’t any other options.

What does all this mean?

  • When the economy turns around, many employees will immediately seek to improve their work situations. Some reports indicate that one third of the workforce is waiting to change jobs.
  • The most employable people (likely the best workers) will be the first to switch; those who lack skills or drive will stay.
  • There is pent-up worker frustration, which employers will be confronted with when alternative employment options emerge.

What can employers do?

  • Begin thinking and behaving as though unemployment is low and it’s a “seller’s market.” Treating employees better now, when you don’t have to, will keep them working for you later, when they don’t have to.
  • Recognize that with downsizing, layoffs, hiring freezes, and consolidations, employees have been stretched and pushed to a near breaking point. Look for ways now to relieve stress and reduce their pressure now.
  • Talk to employees and really listen. Perhaps there are slights that can be amended, injustices that can be corrected, and oversights that can be righted.

You can take steps now to keep the employees you have, or you can wait for economic recovery and take steps then to find and train their replacements.

Peter DeHaan is a commercial freelance writer who provides content marketing services and does ghostwriting.

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The Secret to Successful Joint Ventures and Strategic Partnerships

Author Peter DeHaanBy Peter DeHaan

Astute entrepreneurs are always seeking ways to improve their business, increase revenue, and diversify into related business lines. During this time of doubtful economic conditions, with possible decreased sales and smaller profits, it is even more critical to explore ways to bolster business prospects.

One such way is by working with another organization towards your mutual benefit. This concept goes by different labels, such as joint ventures, business alliances, strategic partnerships, and collaborations. Often these arrangements are informally structured. At other times there is a more formal configuration, sometimes even resulting in a new legal entity established for this express purpose. Regardless of the name or resulting form, the effective consequence is that you now have a partner.

The results of these business alliances can be a sustained revenue stream, a short-term bump in income—or wasted effort and disappointment. In my experience, it is the latter outcome that is most often realized, but it doesn’t need to be that way. Careful advance planning can help avert disappointment and facilitate successful results for both parties. However, before I share my recommendations, let’s first explore why things often go awry: Mutual benefit and satisfaction is required if the result is to be realized and sustained. Click To Tweet

Hoping for a quick fix: Most collaborations take time to produce results. The belief that you can reach an agreement one day and see results the next is unrealistic and prone to disillusionment. If you pursue a joint venture as a last-ditch effort to save your business, it is likely too late to do any good. It is better to seek these types of innovative strategies while you are in a relatively stable position and have the time to nurture and grow them. The payoff will not be imminent, but when done right, it can be sustainable and long-term.

Not willing to contribute: Too often people enter into partnership arrangements with the erroneous expectation that with little or no effort they will realize great benefits from the work of the partner company. This is selfish and shortsighted. Even if results initially occur, they will not last, as the partner will have no reason to persist doing all the work while you reap the benefits.

Pursuing a win/lose agenda: Sometimes one or both parties in a business alliance are trapped in a win/lose mentality. They persist in the belief that the only way for them to come out ahead is for their partner to lose. Again, even if this works for the short-term, it will not last; the end will most likely be filled with accusation and heartache.

Taking advantage of your partner: Other times joint ventures are sought in order to meet a hidden agenda. Perhaps there is some technology, knowledge, information, or expertise that needs to be provided by one party for the project to succeed. The partnership is merely a ruse to quickly and cheaply obtain that desired asset. No one likes to be taken advantage of, and when it occurs, ill will is inevitable and lawsuits are likely.

Inequitable responsibilities and rewards: Arrangements in which one party is consistently expending a greater amount of time and resources while realizing lesser results is one that is destined for collapse. Business alliances that are comprised of givers and takers are doomed from the start.

Lack of agreed upon objectives and measurements: If you don’t know your target, how will you know if you reach it? How will you know if the collaboration is working? Stating that your aim is to increase sales is vague and untenable. Remember that a goal must be specific. It also needs to be quantifiable. Sometimes this is easy; sometimes it is not. Let’s say that the goal is to increase staff morale. How do you measure that? One way might be to track the staff turnover rate, with a decrease in turnover implying an increase in morale. However, is this sufficient and all-inclusive? Does your business partner concur? If your partner wants to measure morale by the number of employee complaints to management instead, with you holding tightly to the turnover stat, it is not likely that there will be agreement on the efficacy of your venture.

No exit plan: It is unwise to assume that a business alliance will last forever. Things change, and what may have been mutually beneficial will one day cease to be. Lacking a clear and defined ending subjects participants to needless worry and anxiety. Suppose that one company needs to buy equipment, purchase inventory, or hire staff for the alliance to continue to function. If there is concern over how much longer the venture will exist, there will certainly be reluctance to make the necessary investments to continue it. This results in tentative and halfhearted decision-making and could doom an otherwise healthy arrangement.

With these pitfalls in mind, let’s consider the recommendations of how to embark upon a successful collaboration:

Be honest and forthright about your expectations and contributions: This is not a time to hold back. Be clear about what you expect and what you will do. Insist on the same attitude from the other person. Holding back key information will not give you a stronger position later but rather will make success less likely.

Pursue a mutually beneficial relationship: If you can’t agree to seek a “win-win” situation, there is really no point in persisting with discussions. Mutual benefit and satisfaction is required if the result is to be realized and sustained.

Set goals: Once it is determined that there is mutual benefit in moving forward, goals or expectations must be established. As previously mentioned, these considerations must be measurable and agreeable.

Do your part: Whatever you agreed to do, be sure that you follow up on it—or ensure that someone else is. Often the negotiation for joint ventures is not conducted by those tasked with implementing them. Therefore, if you are delegating responsibilities that you agreed to, make sure that they are clearly communicated and diligently pursued. If your team doesn’t buy into the project and is not committed to make it work, the contribution that you committed to will not be rendered, and the partnership will fail.

Discuss how and when the arrangement will end: Assume from the very start that the venture will someday end. Discuss what that point is and how to determine it, (which shouldn’t be hard if you were successful with the goal-setting recommendation). Agree on the responsibilities of each company in dealing with resultant assets or remaining inventories in which one party may have a heavy investment. Determine how things can wind down in a controlled, ethical, and responsible manner so that minimal damage occurs to any stakeholders.

While there is much that can go awry in pursuing a business alliance, there is an exciting upside when it is implemented wisely. Aside from producing profitably sustainable results, some joint ventures have been more successful than either founding company; others have been spun off to become their own self-sustaining entity. By avoiding the preceding pitfalls and pursuing the above recommendations, you’ll set up your strategic partnership for success.

Peter DeHaan is a commercial freelance writer who provides content marketing services and does ghostwriting.

Shoot the Puck

By Peter DeHaan

Author Peter DeHaanI have been following the sport of hockey. Before that, a myriad of other athletic diversions captured my attention. As a youngster, I did what many of my peers did and played Little League baseball. Not that I was good at it or particularly enjoyed it. In fact, after four years of mostly sitting on the bench or chasing an occasional stray ball in right field, I realized that I wasn’t having much fun.

I was merely playing the game because I assumed that was what a kid was supposed to do. My attempts to play baseball did, however, lead to watching the big leagues on TV. In fifth grade, my teacher, a fanatic fan of the Detroit Tigers, planned our school day around the playoff schedule so that she—I mean “we”—could listen to the games during study time. The Tigers won the series and I was won over, becoming a devotee. I faithfully followed the Tigers until their next World Series in 1984. Whether it’s hockey, business, or life, you can’t score if you don’t shoot. Click To Tweet

Shortly thereafter, I moved to Wisconsin. It was hard to be a Tiger fan in Wisconsin; in fact, in was hard to be a baseball fan in the shadow of the state’s beloved Green Bay Packers. In a place where being a “cheese head” is a compliment (note to the uninformed: “cheese head” is the proudly self-proclaimed moniker of the die-hard Packer fanatic) I soon adopted the Packers as “my” team. Although my tenure in the dairy state was short-lived, I continued to be a loyal Packer backer after returning to Michigan.

But it was hard for me to get back into baseball. The player strikes, lockouts, excessive hype, and salary escalations distanced me from the game and left me increasingly ambivalent. Disenfranchised with baseball, I segued to basketball. Although I closely followed the college tournament during March Madness, it was not the defensive prowess of college hoops to which I was endeared, but the faster-paced, higher-scoring professional games. But then, as the showmanship became excessive, I began to seek alternatives.

Throughout these meanderings as an athletic couch potato, hockey was a sport that I viewed as anomalous. I treated it with disdain. It seemed to me that the only activity was skating back and forth, with few scoring opportunities and even fewer goals. I just didn’t get it.

When my son, Dan, began following hockey, I didn’t immediately share in his interest and enthusiasm. One day he asked me to watch the game with him. Inwardly I groaned, but outwardly I agreed, because that’s what parents do for their kids. He made popcorn (okay, so maybe it wasn’t going to be so bad after all) and we plopped down in front of the tube. I watched the play move back and forth, right to left and then left to right. Soon the popcorn was gone, but the players kept up their dance with the puck. My eyes grew weary as one more journey up the ice began.

Suddenly, Dan became excited. He jumped to his feet and exclaimed, “Watch this!” as the puck was guided past the blue line. To me it looked like the same play I had already seen a hundred times during that game. “They’re going to score!” he predicted. The announcers amplified the tone of their play-by-play as they sensed that something important was about to happen. Play proceeded across the red line, then a pass and a slap shot, followed by total bedlam and an energetic high-five from my son. On the second replay, I, too, saw the puck go in the net.

I stared at my son in disbelief. “How did you know?” I stammered in amazement.

“Come on, Dad, you could tell it was going to happen as soon as he got the puck,” Dan replied. Obviously, there was more to this game than I could see. I began asking questions and for the first time in our relationship, our roles reversed and my son became the teacher. I was astonished with how much he knew and the subtleties he comprehended. Under his tutelage, my understanding of the sport grew and with it, my interest and appreciation followed. Over time, I learned about a one-timer, the five hole, power plays, a two-pad slide, and the poke check.

Soon, watching the Red Wings become one of our favorite father-son activities. During one game, we watched an uncharacteristically unproductive power play wind down. “Shoot the puck,” I implored the Detroit offense.

“They didn’t have any good scoring opportunities,” Dan responded.

“But they can’t score if they don’t shoot the puck,” I replied.

Dan paused and gave me a quick glance, followed by a brief look of comprehension before his attention was recaptured by the game. Perhaps I had blurted something profound. After all, it did make sense that if you don’t take a shot, you can’t score.

Regardless whether the sport is hockey, baseball, football, or basketball, playing it safe isn’t going to win too many games and is certainly not what championship teams are made of. How many times have you watched a team build a commanding lead, only to lose the game as a result of becoming tentative and mechanical as they tried to protect their lead rather than build upon it?

This example extends to business. While extreme, make-or-break risk-taking is generally not advisable, tentatively protecting what you have built up will not position you to take advantage of new opportunities that present themselves. You could even squander what you have. Yes, many of your shots may miss the mark, but some will be on target. And those that are will keep you moving forward and propel you to the next level.

The same is true in life. If you expect to coast through your time on this earth, hoping that everything will work out, you will end up sad and disappointed. Intentional and deliberate action is what is needed to reach your potential and become the person you are capable of being. I once saw a poster of a large turtle. The caption read, “Behold the turtle; he only makes progress when he sticks out his neck.”

Whether it’s hockey, business, or life, you can’t score if you don’t shoot.

Peter DeHaan is a commercial freelance writer who provides content marketing services and does ghostwriting.

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How Can I Get More Sales?

Author Peter DeHaanBy Peter DeHaan

Almost every day, someone asks me, “How can I get more sales?” In fact, for most businesses, increasing sales is a primary concern. Rarely does anyone tell me that their company is making all the sales they want. I wish they would ask me easier questions, like “How can I improve quality,” “How can I increase revenue,” or “How can I reduce turnover?” All of these I have successfully dealt with, but the sales issue is a bit trickier. It seems that people are looking for a quick fix, a simple strategy. It’s as if they are expecting me to say, “Invest X dollars in Y process to produce Z sales.”

But alas, there is no magic secret. If there were—and  I knew it—I would start a sales and marketing business. My clients would merely tell me their sales goals for the month and I would fill their order. But it is not that simple. Consider the following list:

  • Direct mail
  • Telemarketing
  • Direct mail followed by a phone call
  • Cold calls
  • Trade shows
  • Networking
  • Referrals
  • Yellow page ads
  • Print media
  • Websites
  • Internet advertising

These tactics have a proven record of producing sales in many instances Unfortunately, these same methods have been repeatedly demonstrated to be total failures. Campaigns that have consistently generated high sales numbers for one organization have proven to be colossal flops in others.

The distinguishing factor is not the strategy, but what surrounds that strategy. Here then, is the ultimate—yet elusive—formula for sales success:

Personnel + attitude + execution + management = sales success

Personnel: This is the critical element in the formula. Without the right people in place, nothing else matters. This starts with finding the right person for the job. Over the years, I have hired many sales people. Some worked out, but many didn’t.

What is true for all candidates is even more valid for sales applicants: you see them at their very best during the interview. In fact, even mediocre salespeople know that they must give their best sales performance during the interview. If they can’t convincingly sell themselves to you, how can they possibly sell your service to someone else? To cut through all of this, I have a few key questions I like to ask sales candidates:

How much did you make at your last job? If they made six figures, but can only expect half that at your firm, they are unlikely to work out. They will be unhappy, develop a negative attitude, and leave as soon as a better paying job comes along. Conversely, if they barely cracked the poverty level at their last job, they may be out of their league to produce at the level you expect. Ideally, their prior compensation should be 5 to 25 percent less then what you expect them to make with you. Personnel + attitude + execution + management = sales success Click To Tweet

How much would you like to make at this job? The response to this is most telling. Why? Because if it is unreasonably high, they won’t be satisfied working for you. On the other hand, if it is lower then what you are prepared to pay, then they will start coasting once they hit their target compensation. Again, you are looking for a salary expectation that is consistent with what you can deliver, but is still motivating to them.

Would you like to work straight commission? I don’t advocate that anyone be paid straight commission, however this question is designed to throw them off track and see how they respond. To make this work, you can’t ask the question directly, but need to back into it. If they are at all good with sales, they will have already regaled you with their accomplishments, assured you that they will be your best sales person ever, and promised they will produce at a level beyond your wildest expectations. And, if they have moxie, they may even say you’d be foolish not to hire them or suggest your company will fail without them. (Yes, I have been told this—many times.) Given all of this, they assert that you must pay them top dollar.

At this point, you are in a position to say, “I don’t normally offer this, but based on your track record and past performance, I think you’re worthy of special consideration. I suggest that we consider a compensation plan where you will be highly rewarded for your results and given an open-ended opportunity to exceed your compensation goals.” Then pause, lean forward, and confidentially whisper, “How would you like to work for straight commission?”

First, watch if they can quickly and smoothly react to an unexpected turn of events. Next, you want to see how they retreat from their prior boasting. Often a more realistic picture emerges. Lastly, you will quickly get a true idea of what they expect for base pay and how much they are willing to put on the line in the form of commissions, incentives, or bonuses.

In the event that they are shocked or hurt by this question, simply apologize and indicate that, based on what they were saying, you thought this idea might appeal to them.

Attitude: Having the right sales staff, however, is just the beginning. They also need to have the right attitude. How many times have you seen salespeople talk themselves into a bad month? The thinking goes like this, “Last August was bad. I wonder if August is always bad? I better brace myself for a bad month.” It becomes a self-fulfilling prophecy and they have a bad month.

Or, how many times has a sales person said something like, “I don’t set any appointments for Monday because everyone is always too busy.” Then they add Fridays to the list because prospects are focused on wrapping up their week. The first thing in the morning doesn’t work, nor the end of the day. Before and after lunch is bad, too. I once had a salesman use this logic and he actually concluded that he could only successfully sell on Tuesday and Thursday in the mid-afternoon. It should surprise no one that he sold nothing and his time with the company was a record in brevity.

Another self-defeating attitude is negativity. Consider, for example, the salesperson who says, “Direct mail? That won’t work!” And of course, with that attitude, it never will. Or how about, “That didn’t work last time and it’s not going to work now!”

Are they willing to try new things? If they are open to new ideas and plans, then they have a much greater chance of success than if they are closed-minded. Strangely, all too many salespeople would rather continue to do what has failed in the past than to try something new.

Execution: Closely linked to attitude is the proper execution. In fact, without the right attitude, successful execution is impossible. I have seen ideal marketing plans flop because of poor or haphazard execution. Conversely, I have seen the most ill-conceived and contrived strategies succeed famously because they were diligently, steadfastly, and consistently implemented.

Quite simply, there needs to be a plan. The plan needs to be meticulously followed. And those involved need to be held accountable for their work. This brings up the fourth element:

Management: The glue that holds all this together is management. Good management starts with hiring the right salespeople, giving them excellent training, providing them with appropriate compensation, and motivating them effectively. This must be followed by a sound marketing plan and a supportive environment in which to implement it. Lastly, sales management means investing time on an ongoing basis to encourage, observe, teach, and adjust what they do. Put more succinctly, the right management keeps them on task and holds them accountable.

There is nary a salesperson who can be truly successful without attention and oversight. They need to be lifted up when they are down and celebrated when they make a sale, held responsible for their schedule and made liable for their results. This takes considerable time and effort. As such, proper sales management is not just one more hat to wear, but a full-time job.

Successfully managing salespeople is hard work. It takes time, perseverance, determination, and dedication. But then don’t all things that are worthwhile?

Peter DeHaan is a commercial freelance writer who provides content marketing services and does ghostwriting.

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It’s 3 AM – Do You Know Where Your Data Is?

By Peter DeHaan

Author Peter DeHaanIt doesn’t matter what type of company you run, your operation amasses a great deal of valuable data. You have a treasure trove of customer information, including phone numbers, mailing addresses, email addresses, billing histories, demographic profiles, social security numbers, bank account numbers, and credit card numbers. You purchased some of this data, while you garnered the rest over time, using meticulous recording keeping.

Even the smallest of businesses possess an extraordinary amount of priceless information, while larger organizations store millions or billions of data points — all nicely organized, painstakingly verified, carefully stored, and dutifully backed up.

You have all that information, but what are you doing with it? No, I’m not talking about harnessing metadata to produce a competitive advantage or turning raw information into a core distinctive (think of how Google astutely exploits the vast minutia of data they have accumulated). I’m sure you know you must do these things and are diligently working on them. What I am referring to is protecting your immense information stash from the nefarious reach of notorious hackers, cyberspace’s criminal elite — hard to catch and harder still to prosecute.

With the theft of personal information steadily increasing — due to an insatiable demand and relatively low risk — there is a greater likelihood your business could soon be a victim. So I will implore you to protect one of your organization’s most valuable assets.

First, you need someone with the knowledge and experience to be in charge of securing your computers, network, intranet, and Internet access points.

Then, give them the resources needed to do the job. I’m not suggesting you provide an unlimited budget or give them a blank check, but when they say it will cost X dollars to do the job, don’t provide half that amount and expect full results. If you cut the funds, some items will remain insecure or be only partially secure. That would be akin to locking the doors of your office, but leaving the windows open — or installing a building security system, but never connecting it to the monitoring station. Don’t handcuff the crime stoppers.

Next, know that many security breaches are inside jobs. Yes, I realize you carefully screen new hires and trust your employees to not steal from you. I’d be disappointed if you didn’t hold your staff in high esteem. However, the reality is that many cases of data theft involve an insider, be it complicit or innocently duped.

To address the people side of the equation, you need your human resources department involved, along with IT and your security officer. Together they can put safeguards in place to restrict access, limit the scope of information available, and provide an electronic log of activity. Additionally provide training on what information staff can give out and under what conditions.

Your data — and your company’s future — is on the line. Make sure it’s a secure one.

Peter DeHaan is a magazine publisher by day and a writer by night. Visit www.peterdehaan.com to receive his newsletter, read his blog, or connect on social media.

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