The Employers Resource Council has long been known as a purveyor of advice on hiring practices.
So when it sent out a press release announcing the results of s survey entitled "Employee Expectations High, Employers Forced to Meet Demands," it was only trying to help.
But employers may not see it that way. What employer wants to offer higher wages? What manager likes to hear that he or she should offer more vacation time? What owner wants to pay for employees to take university classes? An owner who wants to stay competitive, according to Melissa Cassidy, director of the research center at ERC.
The study calculated the average costs to employers per new hire for both manufacturing and nonmanufacturing companies. According to the study, hourly employees in manufacturing industries cost $3,345 to replace in 2000. Salary nonexempt workers cost $5,819 to replace and salary exempt workers cost $15,433 to replace.
In nonmanufacturing businesses, hourly workers cost $2,525 to replace; salary nonexempt workers put a company back $5,819, while salary exempt workers cost $10,173.
The Alexander Hamilton Institute (AHI) Employment Resource Center offers advice on retaining employees, including tips on motivation, building morale, increasing employee self-worth, empowerment and communication. The following are tips on how to retain your employees.
Sometimes routines can get old, causing employees' motivation and performance to take a dive. Consider offering alternative work schedules.
The AHI advises, "Flexible work arrangements help employees to strike a balance between work and family, thereby improving productivity in your department." Examples include flextime, compressed workweeks or telecommuting.
The AHI advises employers to give employees high-profile responsibilities: "Employees will approach their responsibilities more enthusiastically if they know that their colleagues will see the results."
Another approach employers can use is to roll up their sleeves and lend a hand. According to AHI, employers can help by personally relieving an employee for one hour for a well-deserved break, for an extended lunch, or to allow the employee "simply to sit back and watch the boss perform one of their least favorite tasks."
Involve employees with decision-making. AHI advises that "by involving employees in the decision-making process, it not only frees up managerial time, it also gives employees a greater sense of responsibility and commitment."
Or create partnerships with employees. By giving them a vested interest in the company, they will feel more connected to their work. The AHI also suggests employers tear down status barriers, open company books and pay for performance.
The Web site www.keepem.com ("Getting good people to stay") warns employers that have yet to come out of the employment Dark Ages that they are in danger of losing employees.
"You have the power to greatly influence your employees' decisions about staying on your team. Show that you care about them and their needs. Remember them. Notice them. Listen to them. Thank them. Love them. Or lose them." How to reach: ERC, (216) 696-3636, www.ercnet.org
In January, the Occupational Safety and Health Administration's Ergonomics Standard took effect to help stem the growing number of cases of musculoskeletal injuries among the nation's work force.
OSHA will start to enforce the standard in October, assuming the new presidential administration and Congress don't make any changes.
While workers' groups and labor unions applaud the new regulation, some major corporations and political groups representing business owners find the standard ambiguous and unnecessary.
The nation's 460,000 yearly musculoskeletal injuries such as carpal tunnel syndrome cost businesses $9.1 billion each year. The fact is, most of the injuries could be easily prevented, says Dave Pfeil, president of Ergonomically Correct LLC in Middleburg Heights and an ergonomics expert who helps business owners design programs to prevent musculoskeletal injuries in office employees.
"When people begin to better understand their body, then they understand why they should put together an ergonomics program," Pfeil says.
He outlines several common musculoskeletal injuries that often plague office workers, and what you can do to avoid them.
Head and neck
Most of us who sit at a desk in front of a computer all day lean forward too far or slouch, causing our head to move out of its proper position over the shoulders. The average human head weighs 12 to 13 pounds, so if it's not correctly positioned, it can put a strain on muscles and tendons in the neck and back.
"If I were to give you a 13-pound bowling ball and ask you to hold it in front of your body, you would get tired very quickly, wouldn't you?" Pfeil says. "Leaning forward is going to cause problems."
Most of us don't gaze softly at our monitor screens. We stare, concentrating on the words, numbers or images on the screen.
During a one-on-one conversation, people blink an average of 22 times a minute. When staring at a computer screen, blinks drop to seven times a minute, leading to eyestrain and reduced energy.Wrists
Most desks, even in the computer age, are 29 inches high. Why? Well, it's an unproven theory that during the '50s, ergonomics tests were performed on U.S. Army solders to determine the ideal height of a writing desk. That turned out to be 29 inches.
The problem is, not everybody is built like a U.S. Army soldier, and many people must reach too high to type on their keyboards. If your keyboard legs are extended, you're doing three times the damage to your carpal tunnel.
"You alter the workstation, you don't alter the person," Pfeil says. "The minute you try to alter the person, you take them out of their natural position, because your elbows should be down close to your side."
Make sure the chair at your desk allows you to sit with your head over your shoulders and to have your elbows comfortably placed at your sides.
A sure sign that you're not sitting properly is the need to stand up and walk around due to tightness or pain in your back. How to reach: Ergonomically Correct, (216) 676-6884; OSHA, (312) 353-2220
Morgan Lewis Jr. (email@example.com) is a reporter at SBN Magazine.
Winemaker Nicholas Ferrante is taking baby steps toward modernizing the image on his wine labels, maintaining consistency and changing just one product line at a time.
"In labeling, you want to update your look while keeping some continuity so you don't lose people," says Ferrante, general manager of Ferrante Winery & Ristorante.
Established in 1937 by Ferrante's father and uncle, the family-owned winery is located on 35 acres of vineyard in Ashtabula County. It produces 15 varieties of table wine, totalling 80,000 gallons annually, and sells it in 11 Ohio counties.
But changing a brand -- whether it's simply the packaging, a logo or an entire product line -- can't be taken lightly. It requires a lengthy period of evaluation to determine not only how to go about the change, but also to promote the change in a way that keeps customers buying the product or service.
Ferrante says part of the reason for the change in the labels was that he wanted to take advantage of the flexibility of pressure sensitive technology. That new technology for making labels is less labor intensive than the glue-applied technology he formerly used, and allows for easier changes. Three pressure sensitive labels make up the front bottle design.
The new graphics were launched late in 2000 with Ferrante's basic table wines, which are sold in many Northeast Ohio grocery stores. The remaining lines will follow over time because, Ferrante says, it's prudent to move slowly.
Susan Jaeger, the graphic designer who worked on the project, says consumers buy a product based on looks. By keeping some of the flavor of the original label, Ferrante is building customer confidence that the product's taste has not changed.
Jaeger describes the new look as clean, innovative and very new for an Ohio-based wine. The image she wanted to portray was a "California ... upscale feel."
The "FERRANTE" logo was kept, while at the same time, a new logo identifying the wine with the initials "FW" was introduced. How to reach: Ferrante Winery, (440) 466-8466
Deborah Garofalo (firstname.lastname@example.org) is an associate editor of SBN Magazine.
Whether or not the current economic slowdown has affected your business, there will be times when change -- whether economic or in your industry, technology or market -- will have an impact on your business.
These are changes that are essentially out of your control. If your biggest customer goes out of business or decides to replace your steel components with plastic ones, it doesn't matter whether the economy is in a growth mode; your company will face a critical time.
Last month, I indicated that not only could companies survive external changes such as an economic shift, but they could actually get stronger. I listed strategies for making this happen and this month will discuss these in detail.
Awareness and action
In 1996, Andrew Grove, president of Intel, published a book entitled "Only the Paranoid Survive." That may be a little strong, but the truth is that for companies to survive and prosper through changing times, management must stay awake and stay aware.
It needs to identify and pay attention to indicators that things outside the company which could affect the business may be changing. To do that, you need to know what those indicators are and what they signify for your business.
Once an indicator has given you a sign that something is changing, you cannot ignore it. You need to react quickly and decisively.
You'll likely never be completely sure what the cause of the indicator is or that your actions are the right ones. As Colin Powell was quoted as saying, "Go for it when you are 40 to 60 percent sure." If you are less than 40 percent sure, you probably don't have enough information. If you are more than 60 percent sure, you've probably waited too long to take action.
Flexibility, momentum and creativity
Many of our clients are reviewing their strategies in light of recent economic changes. They developed strong strategic directions and practices over the past few years when growth opportunities abounded, and now, many of those strategies need to be adjusted.
But because their overall strategic approach was one of flexibility, they are able to easily adjust. They are experienced in developing strategies and in managing them, so reassessing those strategies and modifying them are simply part of their process. In doing so, they are able to keep up their momentum and keep moving forward.
In rough or changing times, although aggressiveness may need to be tempered, a business owner cannot afford to go into a defensive mode. He or she needs to continue to move forward and identify new opportunities for sales, improved operations and growth.
Major changes in a company's market may require out-of-the-box thinking to create those opportunities. The strongest managers will watch for and take advantage of opportunities that may be created by weaker competition. If it is an industrywide situation, opportunities may be abundant.
Stay in control
Finally, management needs to stay calm, think clearly and not panic. It is impossible to make logical decisions when you have gone into irrational panic mode. Your calmness -- or lack of it -- will also affect your organization.
If employees see a calm, methodical process being utilized to deal with the situation, they'll have a much higher level of comfort and confidence. Employees can sense the mood of the company, and a crisis-driven panic mood may cause some employees to panic as well and find other opportunities.
Operating in a boom situation, when everything is positive and opportunities for growth abound, is certainly more fun than dealing with an economic downturn or major industry or market changes. However, being prepared, following basic strategies and keeping everything in perspective can not only make it easier to survive, but can actually make your company stronger and poised for even greater growth. Joel Strom (email@example.com) is president of Joel Strom Associates Inc., Growth Management. His firm works exclusively with closely held businesses and their ownership, helping them set and achieve their growth objectives while maximizing their profitability and value. Reach him at (216) 831-2663.
COSE, the Council of Smaller Enterprises, is working with a number of local organizations to stage a regional business plan competition. Entries are being accepted now through the end of the year, with winners announced early in 2002.
For information, contact COSE Customer Service at (216) 592-2222 or online at firstname.lastname@example.org.
Individuals interested in writing a business plan will find a wealth of resources on the Internet. The following are among numerous reliable sites offering free assistance.
* www.cose.org -- Members and nonmembers will find valuable assistance and support.
* www.sba.gov -- This site offers small business start-up and business plan information, as well as links to other useful sites for business planning.
* www.score.org -- This site from the Service Corps of Retired Executives (SCORE) includes business plan samples, templates, shareware and software.
* www.americanexpress.com -- The small business section includes interactive tools for writing a business plan.
When he was 16 years old, Richard Harris woke up at 5 a.m. to work in his father's carpet warehouse.
He swept, helped installers measure and cut carpet by hand, and hoisted the rolls onto the truck. Meanwhile, his father, Hy, was in the office, checking on jobs, calling installers and balancing the books of the Harris Carpet Co.
Fast forward 22 years. Harris, now vice president of Marshall Commercial Floors Inc., is faced with a dilemma: Double the size of his business again and risk alienating his current customer base or take a step back and risk losing new customers to competitors.
Most business owners dream of having more business than they can handle. But Harris chose to slow the growth and follow a philosophy he developed during his eight years working side-by-side with his father.
"I think you have to get to a point and say, 'Time out,' and look at what you have and take care of the people that have been loyal to you," Harris says. "The key to success in this business is loyalty. Loyalty is everything."
He may be the head of a $6 million company division, but Harris still proudly dresses as an installer. On a mid-January day, he strolls out of his Beachwood office in jeans, sport shirt and a leather jacket, then explains that he saves the business suits for sales meetings with company CEOs and real estate developers.
"I'm not afraid to get my hands dirty," Harris says. "I'll go in the warehouse, help them cut carpet and help the guys load carpet. I talk to my installers on a regular business day because I want to be in touch. They're my eyes and ears."
Although he worked with his father for eight years, Harris spent the bulk of his 24 years in the carpet business at other flooring companies, absorbing the knowledge of how to and how not to run a company. He worked for Crown Carpet and ProFlor, then Carpet Barn and Tile House, which Harris points out filed for bankruptcy well after he left the company.
But while he developed his skills elsewhere, throughout his career, he continually called on the sales and management savvy he learned working with his father.
"I'm still from the old school," Harris says. "What is done in today's age and today's economy, over the Internet and by phone calls and sending out pamphlets and brochures and bidding, my philosophy is beating the pavement. Going right after the owners and cutting to the chase, winning them over with integrity, my name in the business and my dad's reputation in the business."
So it should have come as no surprise when, in June 1996, Marc and Chuck Wien, owners and co-presidents of Marshall Carpet & Tile Inc., tabbed Harris to help launch and run the commercial division of their flooring business, which up to that point only served retail customers and homebuilders.
"Being in business at that point for over 25 years, we felt that we had a void in our business," explains Chuck Wien. "We were getting faxes from general contractors, we were getting inquires from property managers who knew of us, but certain types of commercial needs were beyond our capabilities."
As the Wiens began to plan their company's expansion, they bumped into Harris at a business conference. At the time, Harris was looking to branch out, and his reputation and experience in the industry made him the perfect leader for the Wiens' venture.
"We basically built the business around him," Wien says. "We did open separate facilities, staffing, labor. We kept everything separate and independent of our current operation. From there, he just went to work."
Using contacts from his former jobs and some of the Wien's current clients, Harris landed $2 million in sales for the commercial division in its first year.
Then the floodgates opened.
Three large flooring and carpeting businesses in the Cleveland area went out of business, unleashing hundreds of customers into the market. Marshall Commercial Floors started to more receive business than anyone had imagined. Apartments, offices, stores and restaurants by the dozen called with orders.
New installers were hired. More office staff was added. Over the next two years, sales tripled to $6 million.
That was when Harris pulled back the reins.
"We were hearing some rumblings out in the field that people were concerned that we weren't going to do the same job we always did," says Harris. "I said 'Time out, this doesn't make sense.' If we can take on some of the new business, fine. But only if we can handle the existing business the way we always have. That's what's important."
Staying the course
Harris knew his competition would benefit because he was passing on some new projects, but in the long run, it was better for the company.
"All a customer wants is someone to respond to them, take care of their needs, do the job they're looking for, and continually have that aggressive service they want," he says. "As soon as you lose that service, they're looking to do business with someone else."
Harris' growth rate is now where he wants it. He manages approximately 20 crews of installers, who are all subcontracted, a five-member office staff and three employees in his warehouse. Although there are two part-time sales representatives, Harris still handles 99 percent of the commercial division sales himself.
"I beat the pavement, knock on doors and keep coming at my customers until I get an opportunity to sit face-to-face with the people that run this city and run the businesses," Harris says. "You just can't work behind the desk. It's being out at the project, being on the site and getting your shoes dirty."
While Harris never shies away from the bigger jobs -- he recently completed a $200,000 flooring project for Cleveland State University -- the foundation for his division was built on smaller jobs that can be completed in days instead of months. Too often on the larger projects, flooring companies wage bid wars and drop estimates until the jobs are barely profitable. The risk usually outweighs the reward.
"I'm geared for (the big projects), but I'd rather stay away from them," Harris says. "I would rather do 20 jobs that equal that amount than one, than be on the hook with one person. I'd rather be on the hook with 20."
Like everything else in the construction industry, carpeting and flooring projects are prone to error and delays. Sometimes, it's the fault of one of Harris's suppliers. Sometimes, it's one of his people.
Harris never claims to be perfect, but what keeps his customers coming back is that he admits when he's wrong and corrects the mistake.
"From the mill level to making the goods, to shipping it, to unloading it, to cutting it, to sending it out on the job site, there's a lot of hands on that carpet," Harris says. "The way I look at it, if you jump through hoops on accounts and you make mistakes, you have to be human, be honest with them and fix what you did. My customers know I'll do that."
Harris' ability to soothe an irate customer was one of the key characteristics that landed him the job at Marshall.
"Rick is a super salesman," Chuck Wien says. "He's very caring about his accounts and very responsive with his accounts, and that's what it takes to succeed in that business."
Today, with slow, sustained growth in check, it's what Harris says he's able to maintain. And, it's exactly what he learned from his father all those years ago.How to reach: Marshall Commercial Floors Inc., (216) 514-7900
Morgan Lewis Jr. (email@example.com) is a reporter at SBN Magazine.
In these uncertain economic times, many sales and marketing people are growing increasingly frustrated over the ambivalence of prospects and customers.
Despite strong consultative sales efforts, many sales professionals are finding it takes more time and effort to close business. Even more frustrating are prospects who express remorse over or simply reject customized solutions they helped to define. While buyer anxiety over the economy is increasingly the cause, what is the answer?
If a prospect is not convinced that your solution will work, why not warranty the product or offer a service agreement to ensure results? While this is nothing new for capital goods and software products, most any product or service can be warranted or guaranteed through a service contract.
Why would it make good sense for you business to offer a warranty or service agreement?
- It represents an opportunity for you to eliminate a perceived or real element of risk in the minds of your customers or clients. This will be particularly attractive to managers oversensitive to meeting company objectives and minimizing their personal career risk.
- In a downsizing world, fewer internal resources can be used to ensure the job gets done. Outsourcing is often a likely consequence to cost cutting.
- If priced correctly, service and warranty contracts are profitable. It is more difficult to compare and price shop agreements than products or services.
What parts of your product or service can be delivered through a warranty or a service agreement?
Almost any business, from a consumable or durable product to an intangible service, can be covered. The key is to be creative and break down what you sell in the eyes of what the customer or client is buying.
- Delivery. When, in what form, within what time frame and with how much notice? For example, the challenge of food service is not having food ready, it is having it properly presented in quantities that match quirky appetites.
- Performance and output. How will the product or service meet the defined need, to what standard, with what outcome, through whose cooperation or involvement? For example, can you commit to your product or service being available 24/7/365?
- Acts of God: Standard insurance policies cover many of these, but how can you be creative? If Ohio can have an earthquake, what else could happen?
- The unforeseen. We all laugh at how quirky life can be, even when it comes to routine tasks. Somebody must have insured (and profited) from Tiger Woods' cataract operation. The bigger the downside, the bigger the opportunity.
- You are now in the service business. This may be very different from how you operated before. You own the problem long after you have booked the sale.
- You must deliver to the letter and in the spirit of your customers' expectations
- You are financially exposed in a new way. Be sure you cover your risks
The bottom line is that selling warranties and service agreements in an uncertain economy can be a real source of salvation for you and your customers. As with all new businesses, if you set, agree on and meet reasonable expectations, success will be yours. Andy Birol (firstname.lastname@example.org) is president of PACER Associates Inc., a Solon-based firm that provides expert advice to owners and leaders who need to grow their businesses. He can be reached at (440) 349-1970 or at www.pacerassociates.com.
Helping employees increase their take-home pay can be a significant piece of your employee retention program. As tax time draws near, consider educating your staff about the Earned Income Tax Credit (EITC) and the Advanced Earned Income Tax Credit (AEITC).
Developed in 1975 as a welfare-to-work incentive, EITC is a refundable tax credit that supplements the earnings of low-income workers. More than 18 million taxpayers received EITC in 1997, and an estimated 15 million employees are eligible for the AEITC.
To qualify for EITC, an employee must meet six criteria, including a threshold of $2,400 in investment income and earned income of $31,152. Earned income is defined as (but is not limited to) wages, salaries, tips and salary reductions as a result of participation in retirement or insurance plans.
As an employer, your participation is easy: Notify employees who have no income tax withheld that they may be able to claim a tax refund because of the EITC.
The IRS encourages employers to notify any employees who claim exemption from withholding or have wages less than $10,380 for a single employee, $27,413 for a custodial parent and $31,152 for the guardian of more than one dependent child, that they may be eligible to claim the credit for 2000.
Employees can receive part of the credit in their paycheck if they qualify for EITC for the year instead of waiting for the lump sum at the end of the year. The payments are called advance EITC payments and can increase a minimum wage employee take-home pay significantly.
"Only 1 percent of people that are eligible for the earned income credit actually activate it in their paychecks, and typically that is going to be (more than) a dollar an hour raise to your employee," explains Bethany Davin, director of a local welfare-to-work program.
For an employee earning minimum wage, the increase could translate into more than $100 a month.
To qualify, income must be less than $28,000 and recipients must be the guardian or parent of a qualifying child. A qualifying child means any child cared for, including an employee's own child, step-child, foster or adopted children, grandchildren and/or any child placed with the employee.
Have eligible employees fill out a W-5, which you keep on file. AEITC payments are made directly to the employees from the employment taxes normally deposited or sent to the IRS. For more information, contact the IRS at (800) 829-3676 or visit www.irs.gov.
Kim Palmer (email@example.com) is managing editor of SBN Magazine.
The cold call is a hard fact of doing business. Few people like them but they're a part of every sales strategy.
If your sales team is having trouble with cold calls, consider changing your approach.
Odds are, you're beginning your calls as if you already know the person you're talking to. Instead, when making a business call to a stranger, try this: "Hi, Jane, my name's so-and-so. We haven't met yet. The reason I'm calling is ... "
The key is that you point out that you haven't met yet.
People often receive calls from strangers who take the opposite approach. They don't introduce themselves and instead fake familiarity by asking, "How are you?" This annoys the person being called because it sounds insincere and wastes their time. Jeff Mowatt (firstname.lastname@example.org) is a 20-year veteran of the service industry who develops training programs and consults to business owners looking to improve their staff's service. He can be reached at (800) 566-9288.
CWP Inc. general manager Ronald Varesco was drafting a revision to his company's employee screening policy.
Mired in the details and overall legal issues, he told the office staff of his growing bristled brush manufacturing company to call several other West Side manufacturers and find out about their policies. The research paid off.
"That's how we formulated our policy," Varesco says. "Everybody's in the same boat, fighting the same issues."
A business kinship developed among these manufacturers, culminating in the Learners Groups. The Learners Group is the brainchild of the Westside Industrial Retention & Expansion Network (WIRE-Net) and consists of groups made up of CEOs, presidents and general managers who meet once a month at each other's plants to see operations and discuss issues facing small manufacturers.
Holly Harlan, manufacturing assistance program leader for WIRE-Net, says the idea for the Learners Groups took hold after the first plant tour in 1996.
"I couldn't get them to stop talking after they toured the plant," Harlan says. "They were comparing notes and discussing improvements, and we kind of looked at each other and said, 'I think we've got something here.'"
Some company owners are suspicious of the Learners Groups, fearing a competitor will find out trade secrets. Those concerns are allayed after they learn the 10 groups, made up of 34 companies, are split up so no close competitors are in the same group.
"There's not a lot of competitors out there," Harlan says. "With today's market place everybody's kind of going after their own niche."
Here are some of the benefits of the group meetings.
Learning from experience
Consultants and experts are not allowed in the Learners Groups, only decision-makers who are actually running a plant. The exclusive membership is one the group's drawing points.
"There's a real impact when they look at somebody else's operation," Harlan says. "If they can see their neighbor has a new idea started over there, they will pick it up much faster, and it's going to be so much easier to implement."
Each year, five groups tour each other's plants and discuss each other's operations; the other five groups meet to focus on specific issues, such as attraction and retention of employees, plant maintenance, writing training plans and productivity skills.
The groups weren't formed so that company owners could sell to one another, but new business opportunities are inevitable. In some cases, an owner might recommend a supplier or a customer in the market for another company's product.
More important, CEOs and managers establish a network of contacts they can call on if an issue arises in their plant.
"It's kind of created a business community," Harlan says. "A lot of the time, a general manager is alone, meaning he's the only one making the big decisions. Now he can compare his thought process and decisions with others, and I think it gives them more confidence."
Supporting the industry
While the companies involved in the Learners Groups may independently benefit from the lessons learned, keeping the the overall manufacturing industry in Cleveland competitive is the real motivating force.
"If you're not the low-cost producer, your industry is going to end up in Mexico or a Third World country," Varesco says. "Cleveland, like some other places, would have to pack it in. The strength of this city is dependent on its small manufacturing base.
"I think that's the issue. I think that's what we're trying to do." How to reach: WIRE-Net, (216) 631-7330; CWP Inc., (216) 252-1190
Morgan Lewis Jr. (email@example.com) is a reporter at SBN Magazine.