Northern California (1069)

In today’s competitive marketplace many businesses, even established ones, are struggling to survive. There are many reasons why businesses fail, ranging from inadequate cash flow, to high overhead costs, bad management, expanding too quickly and poor credit. Over the years, however, we have identified five less obvious actions that can destroy your business. These “hidden nuances” are all too common practice among business owners and can set you up for failure when times get tough.  

 

Getting a second job

During times where businesses are facing severe financial stress, it is not uncommon for the business owners to seek another source of income as a contingent back-up plan.

Straddling the fence, however, only sets you up for failure. Energy put toward maintaining a back-up plan keeps you from making a full commitment to your businesses.

Instead, in difficult times, scale back on the “big bold sell” and focus on the “low hanging revenue generating services” that are in high demand and have the capability of generating immediate income. 

 

Not understanding your financials

Operating in the blind puts your business at high risk for failure. Know what you’re spending on what and where you can cut back.

There needs to be systems and processes in place to control purchasing and inventory and budgets need to be followed. It’s important that you not only generate financial reports but that you understand them. It is your responsibility to watch over business finances, not the accountant, the bookkeeper or the division managers.

 

Your dream vs. business opportunity

The “I” mindset will keep a business from succeeding. It’s not about your dream or fulfilling your interest, but about whether there is a need for your product or service.

The No. 1 focus for any business owner should be to fulfill a need in the marketplace. 

 

Not being prepared for economic downturns

During difficult economic times, when the cash flow slows substantially, the lack of savings and lack of a solid plan can be devastating. 

Stay abreast of your customers’ buying trends, identify those customers that may be entering the “slow pay” zone (70- to 90-day payments), restructure staff duties in an effort to increase productivity, and cut back on unnecessary spending.

No follow-up may mean no
repeat business

We’ve all taken customers for granted. Once we obtain their business, we don’t follow-up or ask, “How are we doing?” Moreover, we fail to ask, “Is there anything we can do better?” By not following up, you are likely losing out on repeat business.

Lack of follow-up can appear in the form of a decrease in sales or customer complaints. By the time you reach that point, it is often too late.

The lack of follow-up and not responding to complaints immediately, positions businesses to fail. Avoid the possibility of losing business by taking the time to recognize your customers, ask them for feedback and ask them how you can do better.

 

Garnett Newcombe and Kay Woods are business experts and award winning CEOs who have joined forces to start the speaking platform CEO Real Talk. Through CEO Real Talk they share a realistic foundation for long-term profitability as businesses continue to grow and diversify. Newcombe is co-founder and CEO of Human Potential Consultants LLC, an award-winning employment solutions company. Woods is founder and CEO of Precious Treasures Childcare, an award-winning 24/7 child care center. For more information, visit www.ceorealtalk.com.

Twitter: @CEORealTalk

Facebook: http://on.fb.me/15enCoh

Google+: http://bit.ly/15Rhi1R

Pinterest: http://pinterest.com/ceorealtalk/

YouTube: http://bit.ly/18Q7ffc

Monday, 30 September 2013 20:00

Ah!thentic Ambition

Written by

Jack Butorac thought he had retired from the food industry in 2000, but a small Toledo, Ohio-based pizzeria was calling his name.

Monday, 30 September 2013 20:00

World Entrepreneur of the Year: Overcoming Challenges

Written by

Monte Carlo has seen a lot of risk takers in its day, but not many have been like those who attended the recent EY World Entrepreneur Of The Year conference. These risk takers may use the term “gamble” every now and then, but they more often use their willingness to take a risk as a way to overcome the challenges of running a business.

The collection of the world’s most accomplished entrepreneurs at the conference were innovators, futurists, turnaround specialists and problem solvers.

From this highly qualified group of leaders comes some quality insights into rising above the challenges that could have blocked the success they envisioned for themselves and their companies. ●

 

“We have a phrase: ‘Market leaders need to meet market innovators.’ It’s a ‘two-fer’ because the innovators often need to have partnerships with the market leaders in order to really scale their companies. That could be as simple as a distribution agreement. It could be joint R&D. It could be capital. It could be a variety of things that form a partnership.

Likewise, if you think of firms like Procter & Gamble that have had edicts from the top that half of their innovation will come from outside the ivory tower, then those are the kinds of opportunities that we hope to be able to continue to bring.

Go and find those innovators … and likewise for the innovators, make sure your reach out and look for strategic partnerships that help your business grow.”

Bryan Pearce, Americas Director, Entrepreneur Of The Year and Venture Capital Advisory Group, EY

 

“Cost pressures are always high. What we need to make sure we do is continue to innovate our audit services and all our services to make sure we make maximum use of technology. We also need to make sure we take advantage of both time zone arbitrage and cost arbitrage where talent zones are present.”

Jim Turley, retired global chairman and CEO, EY

 

“The drive to always want to get better and do more is what keeps me going. It’s hard for me to turn it off and say, ‘That’s great.’ I’m always thinking about tomorrow. You can’t take things for granted in our business.”

Corey Shapoff, president and founder, SME Entertainment Group

 

“When you have a monopoly, it slows innovation. It reduces competition and is generally not good for the market. Once you have an open Internet with no government operating on top of it, then I’m very optimistic about humanity when it comes to producing things.”

Sir Timothy Berners-Lee, inventor of the World Wide Web

 

“As a startup you go to the specialty stores first. That’s how you start and you grow and once you reach a certain level, then you go to the big retailers.

I didn’t want to do that. I wanted to go to the big retailers and be in the regular dairy isle. That was a crazy idea and nobody thought that would go, but at least we tried. When we tried, we convinced one retailer in New York. The result from that was we were able to expand to a couple of other retailers. After the second or third customer that we had success with for our yogurt, I knew it wasn’t going to be about selling, it was about making enough.”

Hamdi Ulukaya, founder, president and CEO, Chobani Inc., Entrepreneur Of The Year 2012 United States, 2013 World Entrepreneur Of The Year

 

“In our country, our main challenges are new regulations and new financial reforms that we have to comply with. We are getting together for meetings inside the bank in different areas to study each one of the reforms.

Also at the Association of Banking Industry in Mexico, we have an association of the 44 authorized banks where we get together in different commissions to make sure that we can modify some of the new policies that are going to come out later this year.”

Lorenzo Barrera Segovia, founder and CEO, Banco BASE, Entrepreneur Of The Year 2012 Mexico

 

“One of the main challenges is how to train the talent we have in Latin America. Latin America has 600 million people and 1 million IT workers. The next step is to train more people and convince people to adopt technology as a career. If you provide the proper entrepreneurial environment to that, maybe the next Google or Facebook can come from Latin America.”

Martin Migoya, CEO, Globant, Entrepreneur Of The Year 2012 Argentina

 

“One of the biggest challenges the industry faces is trying to figure out what the impact of the natural gas/shale gas revolution is going to have on us. Suddenly there is cheap natural gas, which is going to be more challenging for renewable projects to compete with. Rather than looking at it as an either-or world, you have to look at how the two technologies can work together.”

Jim Davis, president, Chevron Energy Solutions

 

“Zonamerica is a different kind of company, a business and technology park. But in general, we have a financial sector, we have 60 banks, a wealth of private funds, we have call centers, cell services and headquarters for companies that want to develop business in the region. The problem is all these companies require very qualified personnel. Our core purpose is to attract the best human resources to produce or offer the product. So we created a database and we have, at this moment, more than 24,000 people registered. Then these companies, according to the needs they have, can see and select the personnel they want. And then we also have schools to teach skills to prepare people for these kinds of employment.”

Orlando Dovat, founder and CEO, Zonamerica, Entrepreneur Of The Year 2012 Uruguay

 

“Zonamerica is a different kind of company, a business and technology park. But in general, we have a financial sector, we have 60 banks, a wealth of private funds, we have call centers, cell services and headquarters for companies that want to develop business in the region. The problem is all these companies require very qualified personnel. Our core purpose is to attract the best human resources to produce or offer the product. So we created a database and we have, at this moment, more than 24,000 people registered. Then these companies, according to the needs they have, can see and select the personnel they want. And then we also have schools to teach skills to prepare people for these kinds of employment.”

Orlando Dovat, founder and CEO, Zonamerica, Entrepreneur Of The Year 2012 Uruguay

 

“Probably the most difficult cost control challenge is managing staff salary software. There is a specific reason for that within our company — we are going through a system conversion, so when we acquire practices, they each have their different practice management software. Some are fully computerized; some are not computerized at all. We at one point had 18 different systems within our company. We have converted all of our 107 locations onto one platform this year, so with training and obviously the unknowns that occur with changing people's worlds by changing their operational platform, that's our biggest challenge this year. Having said that, that will allow us to create a line of central efficiencies in the coming years.”

Dr. Alan Ulsifer, CEO, president and chair, FYidoctors, Entrepreneur Of The Year 2012 Canada

 

Monday, 30 September 2013 08:00

Understanding your ‘natural instincts’

Written by

The animal kingdom has long been instrumental in teaching children about appropriate behavior.

A rabbit named Peter educated us on the importance of conflict resolution. For better or worse, Curious George was habitually inquisitive and, in separate incidents, three bears and three pigs taught us the importance of home security.

But despite a literary reputation as “big” and “bad,” according to Jack Hanna, “A wolf will feed the sick, the old and the young first.”

That’s a pretty impressive character trait for a creature so often maligned by the human race. Over the years, however, we’ve learned to expect Hanna to set the record straight on an important part of our world that most of us will never experience firsthand.

 

Following the footsteps of a legend

Inspired by wildlife pioneer Marlin Perkins, Hanna parlayed a fascination with animals and a position leading the Columbus Zoo into a television empire spanning 30 years. He’s had countless TV appearances on popular shows such as “Good Morning America” and “The Late Show with David Letterman.” In addition, he currently helms two television programs, “Jack Hanna’s Wild Countdown” and “Jack Hanna’s Into the Wild.”

Not surprisingly, Hanna’s high regard for the animal population is also reflected in his view of the public’s acceptance of the animal kingdom: “Most people who say they don’t like animals don’t like people much either.”

Phil Beuth, former president of “Good Morning America,” observes, “With Jack, what you see is what you get — he’s a genuine gentleman.”

Hanna has set a simple benchmark for appropriate professional behavior, “I operate by The Golden Rule — do unto others as you would have them do unto you.”

Of course, humans are animals too — complete with instincts, genetic predispositions, unique skill sets and laws to keep us from acting like predatory animals. Yet, prey we do — leveraged buyouts, hostile takeovers, foreclosures, etc.

 

Comparing workforces of nature

When asked about lessons human worker bees can glean from the animal kingdom, Hanna enthusiastically says, “Just look at ants and termites. They each have specific jobs to do.” By performing specific tasks every day, these creatures work solely to serve the greater good — ostensibly without complaining.

Animals = 1 Humans = 0

Hanna also points to an innate respect in the wild that does not always translate into the land of the bipeds: “The animal world does not waste food and animals do not abuse their own children. For example, gorillas may fight but they still work together.”

Working through issues to achieve top performance is apparently part of the natural order of things. It’s about survival. As the concept of business survival has never been more prominent, shouldn’t cooperation receive equal billing?

Animals = 2 Humans = 0

Though Hanna also marvels at the mysteries behind the instinctual and highly effective way animals communicate, many in the office marvel at some people’s overwhelming lack of communication skills.

Animals = 3 Humans = 0

Specifically, according to Hanna, “The elephant is one of the most intelligent creatures on the planet.”

So yes, it seems that without the benefit of an iPhone, Twitter or Outlook, an elephant truly never forgets.

Time to hire me an elephant. The Laws of Nature win every time. ●

 

Speaker, writer and professional storyteller Randall Kenneth Jones is the creator of RediscoverCourtesy.org and the president of MindZoo, a marketing communications firm in Naples, Fla. For more information, visit randallkennethjones.com.

Twitter: @randallkjones

Facebook: https://www.facebook.com/mindzoo

https://www.facebook.com/RediscoverCourtesy

LinkedIn: http://linkd.in/1cQ7A5J

YouTube: http://www.youtube.com/randallkennethjones - http://bit.ly/17G550A

Google Plus: http://bit.ly/15BWZq0

A marketing epidemic, to put it mildly, has been impacting most businesses — and it’s time to think about keeping your message simple if you haven’t already done so.

The roots of this epidemic can be traced back to two events.

First, during the economic fall of 2008, as businesses looked for ways to preserve revenue streams, companies hunkered down and focused on sales to preserve existing customers. Many cutoff or significantly reduced marketing budgets, and others shifted to digital media as a “low-cost alternative.”

The second event was the rapid spread of social media and the skyrocketing use of smartphones and tablets, which provide instant access to relationships, information and communication.

The social media craze and businesses’ desire to market on the cheap led companies to flood the marketing channels with content. Sales sheets, photos, videos, web pages — companies were suddenly all things to all people because they could push content to digital channels for “free.”

The problem — our marketing channels are now very noisy. As consumers of information, we respond to this noise with limited attention spans. The result — companies have sent confusing messages to the marketplace and people aren’t listening.

This current epidemic of marketing noise distributed across all channels leads to a common marketing need for all businesses — simplification.

 

Keeping it simple

So how do you achieve message simplification? It all ties back to the business. Here are seven steps to help get you started:

1. Identify three to four key business objectives for the next two years. Do you want regional growth or growth in a new industry? Do you want to sell more to existing customers?

2. Prioritize your objectives by placing dollars or number of opportunities next to them. This will help you focus on the most important areas.

3. Brainstorm a list of marketing tactics that can help you achieve each objective. Can you generate more leads from trade shows, your website, your existing customer list? What tactics do you need to adopt?

4. Write a succinct summary, or “elevator pitch.” This should be one to three sentences on how you benefit the people you are targeting in your objectives.

5. Compare your elevator pitch to your marketing tactics and existing materials. Review your website, brochures, email newsletter, social media accounts, videos, trade show collateral, etc. Notice how many “extra” things you say in an effort to cover all your bases.

6. Rework your message. Focus on the audiences for your key objectives. Identify the benefits for these audiences. Your marketing message should speak directly to these audiences so they can understand your value and usefulness to them.

7. Prioritize your marketing tactics. It’s tempting to be trendy and market on social media or through video, just remember to consider which tactics will best reach your audiences. You don’t need to be in every marketing channel, just the ones where your customers and prospects will hear you.

 

Finally, once you’ve simplified your message, stick to it! It is important so that people understand the benefits and value that you deliver. While it might seem repetitive to you, your audience will appreciate the clarity and with time, will remember what your business does best. ●

 

Kristy Amy is director of marketing strategy for SBN Interactive. Reach her at mailto:kamy@sbninteractive.com or (440) 250-7011.

Life has a way of presenting us with difficult circumstances. Sometimes it’s in our personal lives, and sometimes it’s in our business.

If the circumstance is severe enough, it can create a crisis, which can often cause a feeling of hopelessness. When things outside your control come at you in droves, it becomes difficult to cope with them. Entire organizations can be overwhelmed and pulled down by external circumstances, which if not dealt with promptly and correctly, can destroy the company.

The CEO’s role is to right the ship and rally everyone around a solution — and it most likely won’t be easy. People are always looking for the easy way out, but that path is rarely an option. When facing a difficult situation, you have to play the ball where it lies, which means the resources you have in people, dollars or equipment are all you may have to work with.

But challenges also present opportunities. Faced with a crisis, you and your leadership team will be forced to look at your assets in new ways. You’ll be required to take a careful look at your customer base, your market and your processes. This kind of in-depth evaluation may uncover not only a possible solution to your problem, but it may open your eyes to markets or applications you never considered before.

Take Netflix for example. The company was the king of DVD-by-mail, and had already knocked off the once mighty Blockbuster. With the increase in streaming video content, however, customers began moving away from DVDs, threatening Netflix’s main revenue channel. It reacted by creating not only streaming content, but also by creating its own unique content. Customers can stream video from many outlets, but it’s tough to beat Netflix’s reputation and ease of use.

Often, the resources you need are already at hand; they just need to be used in new ways. Netflix already had the capabilities; it just needed to apply them differently.

You may find that after assessing what you have, you have started to create a new path that leads away from the crisis.

At the beginning of a difficult time, you may not be able to see a way out, which can lead to despair. By starting with an initial step and continuing, however, you’ll soon see the light. Start by calling your bank or suppliers to ask for better terms or whatever it is you need, and then build from there.

No matter what you do, though, don’t compromise your integrity. Always do the right thing in the wrong circumstances, because depending on how severe your crisis is, your reputation might be the only thing you have to negotiate with.

If you work hard, do the right thing and stay positive, a solution will likely present itself. It may not always be in a form that you anticipated — you may need to change your products or your market — but if you keep an open mind and work with what you have, everything will work itself out. ●

Most weeks I get on a plane and attempt to have an out-of-body experience to deal with all the hassles of flying as I travel from point A to point B. When flying, I have a few simple rules. One, I almost never eat the food. Two, I attempt to talk to no one other than obligatory hellos. Three, I never argue with or say a cross word to flight attendants.

One other very important practice I follow on land, sea and especially in the air is that I constantly scan my surroundings for potential troubles and new ideas.

On a recent flight, upon boarding, I quietly and obediently proceeded to my assigned seat.

As I began to sit down, a gentleman asked if I would mind trading seats with him so that he could sit next to his wife. Like most seasoned travelers I try to accommodate reasonable requests. In this case it seemed a no-brainer to agree to move.

 

Notice the details

As I started to settle in and fasten my seat belt I noted that my new seatmate was very hot. No, it’s not what you’re thinking. I mean she seemed to be flushed and radiating heat, ostensibly from a high fever. I’m thinking, this is not good, plus it proves the age-old adage that no good deed goes unpunished.

In the next minute I had an epiphany, which happens frequently as I believe that many problems come disguised as opportunities.

I rang the call button and, when approached, asked the cabin attendant to please bring me two cloth napkins. I stated that the purpose was to construct a makeshift face mask by tying the two pieces together to prevent possibly contracting some dreaded disease.

I feared that my intentions could be misinterpreted if I were to don a mask without an explanation; this could cause a well-meaning passenger to drag me to the floor thinking I had nefarious motives.

The stewardess smiled, nodding approvingly of my plan. She then summoned all her co-attendants to my seat and proceeded to whisper what I was attempting. Otherwise, she explained, they, too, could misunderstand my appearance and cause me bodily harm.

As founder and CEO of Max-Wellness, a health and wellness retail and marketing chain, I’m always looking for that next special something to share with my team. Therefore, while burying my now masked face in a newspaper so as not to frighten or offend the sick seatmate, I began dictating a memo to my merchandise product group proudly asserting that I just had another “aha!” moment, for which I am well-known, among my colleagues. For full disclosure, however, I am sometimes known for being a bit “out there” on occasion — but no one bats a thousand.

 

Turn an idea into a product

This particular predicament gave me the idea to develop a product kit that we could sell to weary travelers in our stores and in airports. I suggested a handful of complementary products, including a mask, a disinfectant spray and, if all else fails, relief remedies. I also noted that it probably would be prudent to include a cigarette pack-type “Black Box” warning stating that the mask is not what some suspicious flyers might think, but instead it’s for prevention of disease only. I even proposed we market these kits directly to the airlines to dispense as an emergency prophylactic for passengers exposed to airborne (pun intended) pathogens.

 

Fleeting thoughts have value

A key role for business leaders is teaching a management team to use fleeting thoughts as a springboard, to pair common problems with sometimes-simple solutions.

Just because it is a simple fix, though, doesn’t mean the idea couldn’t be a lucrative breakthrough.

When something sparks an idea it needs to be taken to the next level before being pooh-poohed. Most likely the vast majority of these inspirations won’t see the light of day, but that’s OK. Just think — what if one transient idea translates into the next Post-it Notes, Kleenex or bottled water?

The next time you sit by a masked man on a plane, it most likely won’t be the Lone Ranger. Instead, you might be witnessing the incubation of the next best thing since sliced bread. ●

 

Michael Feuer co-founded OfficeMax in 1988, starting with one store and $20,000 of his own money. During a 16-year span, Feuer, as CEO, grew the company to almost 1,000 stores worldwide with annual sales of approximately $5 billion before selling this retail giant for almost $1.5 billion in December 2003. In 2010, Feuer launched another retail concept, Max-Wellness, a first of its kind chain featuring more than 7,000 products for head-to-toe care. Feuer serves on a number of corporate and philanthropic boards and is a frequent speaker on business, marketing and building entrepreneurial enterprises. “The Benevolent Dictator,” a book by Feuer that chronicles his step-by-step strategy to build business and create wealth, published by John Wiley & Sons, is now available. Reach him with comments at mfeuer@max-wellness.com.

Whether your wish list includes manufacturing, medical, transportation or technology equipment, how you finance major purchases may not only impact the return on your investment but the success of your entire company.

“Financing decisions impact cash flow and a company’s ability to capitalize on opportunities or respond to adversity,” says David Beckstead, Pacific Region sales manager for the Equipment Financing Division at California Bank & Trust. “Executives need to weigh their options carefully before making a decision.”

Smart Business spoke with Beckstead about the need for prudent financing decisions when purchasing machinery and equipment.

What should executives consider as they are reviewing various financing options?

The rule of thumb is to match the financing terms to the life of the asset. In other words, it’s best to use short-term financing for short-term business needs, and longer-term financing for long-term business assets such as equipment that will generate revenue or reduce operating costs for the foreseeable future.

You can avoid finance charges and interest by paying cash, but leasing the equipment or borrowing the funds lets companies preserve capital for other purposes. You should also consider the tax implications and the ultimate cost of the equipment along with your ability to make a substantial down payment to secure a traditional bank loan.

When does leasing make sense?

Leasing makes sense when companies want to preserve cash for future growth or expansion, they need flexibility or they don’t have a lot of cash to put down. Since leasing companies usually maintain ownership of the asset, companies can upgrade or return the equipment should their needs change. For example, you can align the lease terms with a customer agreement or upgrade to a bigger, faster model as your company grows. Plus, most leasing companies don’t require a down payment and it may be possible to negotiate a longer-term payment plan, improving cash flow.

With leasing you can usually deduct the lease payments as a business expense on your tax return, and on short-term leases the rental expense may provide a better tax benefit than depreciating the asset. You may be able to transfer the risk of ownership to the leasing company depending on the type of lease.   

How can executives research the market and secure favorable leasing terms?

Prioritize your needs, and then search for the best combination of rates, terms, flexibility and customer service by contacting several firms. Bank leasing companies usually have high underwriting standards but lower rates, while finance companies can be more lenient lenders but generally charge higher rates. Vendor finance companies are a third option and are generally the most flexible about taking back or exchanging equipment. However, they usually charge higher rates.

Beware of upfront payments and fees, hefty residual payments, pay-off fees and other clauses that may boost the overall cost of the equipment. In fact, it’s a good idea to ask a knowledgeable third party to review the agreement so you don’t forsake the benefits of leasing by accepting disadvantageous terms.

What should executives look for in a leasing firm?

Always consider a firm’s reputation, check its references and read its contract before requesting a quote. Contracts differ between companies and impact everything from tax deductions and residuals due at the end of the lease to the responsibility for servicing the equipment. Finally, select someone you trust. Your financing partner should provide funding and be committed to your success.

David Beckstead is Pacific Region sales manager for CB&T Equipment Finance. Reach him at (949) 457-0458 or david.beckstead@calbt.com.

Insights Banking & Finance is brought to you by California Bank & Trust

Leaders are often viewed as great orators who inspire people with their words, but listening is actually the most important leadership trait, according to Matt Zumstein, a partner at Ropers Majeski Kohn & Bentley PC.

“Many leaders are great speakers. However, when you’re able to listen and respond to what clients and employees are saying, you can become a more effective leader,” he says.

Smart Business spoke with Zumstein about what he has observed in successful business leaders and how that translates into more successful organizations.

Why is listening the most important attribute for leaders?

Most people aren’t very good listeners. By listening carefully, you’re also able to ask better questions. Good leaders hear what customers and employees want and need. After listening and gathering useful information, a leader can provide better direction, and the company can focus more on the needs of its clients.

When speaking or presenting, it helps to include a compelling story. Storytelling, or having a theme to your story, is a powerful way to put forth ideas, whether selling a product to a client, giving a team its marching orders or for any other purpose. This can apply to a discussion with a prospect at lunch, in the boardroom or through an online video. The power of incorporating a real-life story into the message can be invaluable.

What other qualities do leaders need to demonstrate?

It’s very important to be authentic. When telling a story, you must be able to personalize the message in order to illustrate integrity, humility and vulnerability. These are characteristics a leader needs to create positive energy. When people can recognize authenticity, they will respond more favorably.

There used to be a clear separation between private and business lives. Today, with technology and social media, the separation is no longer clear. As a result, it is important to understand your client base and use available online tools to your advantage.

A good leader usually loves what he or she is doing. Colleagues and customers can easily recognize when you bring a passion to daily activities. Remember the Energizer bunny? In order to be an effective leader, find your bunny — the thing that energizes you and keeps you going. When you do that, it will become contagious. That’s why motivational speakers like Tony Robbins are successful — people can see their passion.

How do people sabotage their own leadership efforts?

If leaders become too focused on looking ahead at the challenges they face, they can forget what they’ve accomplished and miss out on significant learning opportunities. It is important to be grateful and thankful for what you’ve achieved.

Another problem is not empowering colleagues or support staff to help develop the self-confidence they need. A lack of confidence can breed negativity and infect the entire organization.

A lack of effective communication is the main reason that relationships, and businesses, fall apart. It’s important to be candid and authentic. If you promise a growth opportunity you can’t provide, you will quickly lose your credibility. When you admit what you can and cannot do, people recognize your authenticity and are more willing to support you.

To be an effective leader, don’t limit your focus to the end of a project. Carefully consider all that is needed to get there. If you’re looking to increase revenue by $1 million next year, what effect does that have on family time or the ability of the company to do charity work? How you get there is just as important as getting there.

Don’t forget about the fun part of life. Reward your team with tickets to a movie or gift cards for coffee. When people feel like they are recognized for their accomplishments, it creates a positive energy and everyone will be willing to strive for, and accomplish, a lot more. 

Matt Zumstein is a partner at Ropers Majeski Kohn & Bentley PC. Reach him at (650) 780-1641 or mzumstein@rmkb.com.

Learn more about Matt Zumstein.

Insights Legal Affairs is brought to you by Ropers Majeski Kohn & Bentley PC

Depending on your circumstances, year-end tax planning strategies can bring multi-year benefits.

“The end of the year is a great time to review for tax planning opportunities because most of the income items for the year are known,” says Geoffrey M. Zimmerman, CFP®, senior client advisor at Mosaic Financial Partners, Inc.

Smart Business spoke with Zimmerman about some tax planning items to consider.

How can big year/little year planning help?

If your income varies significantly from year to year, look for ways to decrease income in the big income year and increase income in the small income year.   Corporate executives with stock options have flexibility as to when they recognize this income. Employees with access to nonqualified deferred compensation (NQDC) plans have opportunities to defer some annual income.

For the charitably minded, a big income year offers opportunities to leverage the use of a donor-advised fund: A larger-than-normal charitable donation is made to the fund in the high-income year when the itemized deduction has more tax benefit, and then funds are disbursed to your preferred charities over multiple, lower-income years. Charitably minded investors over age 70 ½ with IRAs should consider making some charitable donations directly from their IRA.

Households with unusually low income in 2013 may benefit from accelerating income by exercising stock options, or via a partial conversion from an IRA to a Roth IRA. Once in a Roth IRA, the converted amount plus any growth is generally tax free, and is not subject to minimum distribution requirements. This is a powerful planning tool for managing future income tax liability and preserving wealth across generations.

What’s important to know about alternative minimum tax (AMT) planning?

Households in the early stages of AMT should explore strategies involving timing of itemized deductions, particularly AMT preference items like property tax and state income tax payments.  
Households that are deep into AMT have some significant opportunities beginning at the point where Alternative Minimum Taxable Income (AMTI) exceeds approximately $480,000 up until the point where ordinary tax exceeds AMT. In this range, the top marginal tax rate is 28 percent, not 39.6 percent. The opportunity involves increasing income — via exercise of stock options, IRA to Roth conversions, or other means — if such income would otherwise be taxed at a higher rate in the future.

As a starting point, couples with taxable income between roughly $500,000 and $1.2 million — particularly those with large amounts of preference items — should take a close look here.

What else should executives know about stock options?

Incentive stock option (ISO) strategies deserve a close look at the end of the year. If you have ISOs and are not in AMT, consider exercising ISOs up to the point of triggering AMT. If you’ve exercised ISOs during the year then you need to review your ability to meet the qualifying holding periods and the cost of paying AMT.

The AMT event is locked in on Dec. 31, so year-end planning is crucial to avoid the risk of paying AMT in the current year and ordinary tax the following year if the qualifying holding period isn’t met.

How can executives use NQDC plans?

An NQDC plan allows participants to defer a portion of their income to a future date. Salary deferrals typically may be invested and diversified, and distributions and taxation postponed until separation from service.

A tax-neutral planning strategy matches salary deferrals with stock option exercises of a like amount, moving dollars from a position with single stock risk and a distinct expiration date into a more diversified pool of funds with no explicit expiration date. NQDC plans do have risk because these plans are typically considered company assets until distribution occurs.

Geoffrey M. Zimmerman, CFP®, is a senior client advisor at Mosaic Financial Partners, Inc. 
Reach him at (415) 788-1952 or Geoff@MosaicFP.com.

Insights Wealth Management & Finance is brought to you by Mosaic Financial Partners Inc.