All companies that own, rent or lease a building may need flood insurance, regardless of whether the business is near a body of water or it is a requirement of a lender.
“Even if your business has a low risk of flooding, it’s wise to obtain a quote on flood insurance. Twenty-five percent of all flood claims occur in areas that are considered low to moderate risk,” says Linda Cook, vice president, Personal Insurance Division at ECBM. “Flooding can result from sources such as broken water mains, runoff water, storms, melting snow and other natural causes.”
In the aftermath of Hurricane Sandy, many property owners were unsure of how their flood policies would respond.
Smart Business spoke with Cook about what you need to know about flood insurance, including what is covered and not, to take back control.
What’s the National Flood Insurance Program?
The NFIP was established to provide a means for property owners to financially protect themselves against flooding in participating communities. A participating community agrees to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding.
Why do you need flood insurance, especially if there’s federal assistance?
Most homeowner and business property policies do not cover flooding conditions or floods. A flood policy can be purchased through your insurance agent or directly through NFIP. All rates are set by FEMA and do not vary from one insurer to another. The premium for a flood policy averages about $700 annually, with maximum limits of $500,000 per nonresidential building and $500,000 for nonresidential contents. The maximum limit under a residential flood policy is $250,000 per building and $100,000 for contents. If higher limits are needed, they may be purchased under an excess flood insurance policy.
As for federal assistance, most forms of assistance are only available after the president declares an area a disaster, and less than 50 percent of all flood incidents are declared official disasters. In addition, most federal disaster assistance to businesses comes in the form of a loan.
How is property-flooding risk assessed?
There are several factors involved in assessing the degree of risk, but a prominent one is the flood zone of a property. This is an area that FEMA has defined according to varying levels of flood risk. An elevation certificate, acquired through a licensed surveyor or engineer, will be able to provide information on the flood zone, the base flood elevation of an area and how a building is elevated. For a favorable flood insurance rate, the building insured should be elevated above the base flood zone.
If you rent commercial space, does that mean you don’t have to do anything?
No. You will need to purchase flood insurance in your business name to provide coverage for your contents. The building owner should have a separate policy to cover the building and whatever contents he or she needs covered.
What else do you need to know when buying or using flood insurance?
A flood policy only provides coverage for direct physical loss by or from flood. Losses are paid on actual cash value (ACV), not replacement cost value. So if, for example, the cost in today’s market to replace your contents is $80,000 but the ACV may be determined to be $50,000, you may only receive the ACV amount, or $50,000.
One particular area where contents coverage is limited is in the area under the lowest elevated floor, which may be a basement, finished or unfinished, as well as an elevated area with lattice or walls. It is important to read your policy.
Some important items that a flood policy does not pay for are:
- Loss of revenue or profits.
- Loss of access to the insured property.
- Loss of use of the insured property or location.
- Loss from interruption of business or production.
- Damage caused by mold, moisture or mildew over a period of time.
A list of excluded items is available from a licensed agent or consultant.
Linda Cook is a vice president, Personal Insurance Division at ECBM. Reach her at (610) 668-7100, ext. 1288 or email@example.com.
Insights Risk Management is brought to you by ECBM
How often do you go to market without a solid business strategy? Probably never, right?
The reality is that if you’re like most organizations, then you’re doing this right now — and you don’t even know it.
That’s because most organizations do not have a well-thought-out marketing strategy. Instead, most are doing what somebody told them they should do. This includes creating a mobile website, engaging in social media and advertising.
All of these are “smart” marketing initiatives. But if they’re done in a vacuum, there’s no way to measure what results those initiatives are intended to accomplish. Worse, you’re chasing tactics instead of delivering results.
There is a significant difference between marketing tactics and marketing strategy. Marketing tactics are ways to bring channels to life. This could be a new website or a mobile-optimized version of your site. Or it could be creating new sales collateral. Tactics should be used to bring your brand message and value proposition to life.
Unfortunately, if they’re not tied to a cohesive strategy, you will not achieve the results you desire.
A marketing strategy, however, allows you to understand the results you should achieve. It also keeps everyone aligned with what you’re trying to accomplish and where you are in the process.
As an example, there are three main reasons for a website: to verify your organization’s brand message to potential customers, to deliver your value proposition and conversion.
Conversion can mean different things for different industries. In retail, it might mean picking out a product, putting it in your shopping cart and making the purchase. In business-to-business, conversion might mean picking up the phone to contact the company, providing a name, email and phone number, or signing up to receive a newsletter.
Without understanding how consumers behave, you may be selling your marketing efforts short. You might not be providing enough information to clearly articulate your brand message or value proposition or you might not be offering users an easy experience that allows for conversion. So how do you ensure that a consistent brand message, value proposition and the ability to target customers converts across all marketing channels?
First, understand who the target consumer is and their needs, attitudes and behaviors. This can be discovered through research, including focus groups or through industry-based segmentation.
Then, conduct a deep dive to understand your business goals and objectives. In retail, this might be the number of sales you want to drive. In B2B, it could be increasing the numbers of prospects in your pipeline.
Finally, evaluate your company’s existing marketing tactics — your website, marketing collateral and overall brand message.
Only then will you be well-equipped to evaluate your overall tactics and compare them to marketing best practices and the competitive landscape. This results in recommendations that include expected business results and return on investment.
Prioritize these by measuring the highest impact against investment levels, and then create a timeline to implement them over a one- to two-year period. Share this strategy throughout the entire organization so everyone understands what will be accomplished and what the expected results are.
Without strategy, and an understanding of everything that goes into it, any money you pour into tactics tends to be money poorly spent. Done correctly, your marketing strategy suddenly becomes your organization’s key driver and leads to tangible and measurable business results.
Dave Fazekas is director of digital marketing for Smart Business Network. Reach him at firstname.lastname@example.org or (440) 250-7056.
What is the best way to motivate employees? Some successful CEOs treat employees as friends, while other equally high-achieving leaders regard employees as merely hired hands, giving them a day’s pay for a day’s work and nothing more.
What’s the best approach to produce the best results for the company, the employee and the employer? Much of the issue lies with one’s definition of a friend and the culture of the organization. Many companies boast that their employees are like family. This sounds great, but can it work?
If either party crosses the fine line that separates the difficult-to-define business and personal space, both employer and employee can become disenchanted or worse. One way to think of it is that friendship is more unconditional. We accept a friend for what he or she is or isn’t. On the flip side, the reality is that most bosses embrace or reject employees for what they do on a consistent basis.
The military has its own way of handling fraternization between officers and the enlisted by making it a possible court martial offense. This stance is predicated on the belief that socializing between these two levels is “prejudicial to good order, discipline and partiality.” It is well recognized that business relationships without boundaries can produce too much drama.
Perhaps what we need is a new definition for a nonemotional, congenial, enjoyable and productive day-to-day relationship between leader and follower. This moniker could be employee-friend, or “e-friend” for short. “E-friend” isn’t an app but would describe an employer/employee relationship where there is mutual respect and a genuine appreciation of one another, underscored by an understanding, albeit perhaps unspoken, that when the time for talking is done, the boss has the final word on matters that occur between 9 a.m. and 5 p.m. Using these ground rules, both sides can have it both ways by using good judgment and treating each other as they would want to be treated if their roles were reversed.
The employee should expect from the boss that, when the chips are down, either on a business basis or when the employee has a personal problem, he or she knows that the boss will be there for him or her, providing understanding and advice and, when requested, helping the employee maneuver through rough patches. From the employer’s perspective, the employee would be someone who, through thick and thin, is there for the company and can temporarily put personal needs aside when there is a business issue that can’t be postponed.
The e-friend boss should know as much about the employee as the employee wants the boss to know, which can include sensitive professional problems or even family or medical issues. In a good relationship, the boss could certainly know, as one example, what the subordinate’s kids are up to in their lives and be the first to say to the employee that it’s more important for him or her to go to an offspring’s ballgame or play, rather than putting in extra time on the business project du jour.
Instinctively, employees know if a boss truly cares or is just going through the motions to be politically correct. They know if the head honcho is sincerely concerned about them as a person, not just another set of hands.
Not everything and everyone in the workplace are created equal. There will always be a pecking order; however, there is nothing wrong with truly enjoying the people with whom you work every day and sharing meaningful experiences, all of which lead to a more fulfilling role for both the employer and the employee. The best criterion to avoiding problems is using generous doses of plain common sense. There is a much-quoted line from the 1987 movie “Wall Street,” starring Michael Douglas as the ruthless tycoon Gordon Gekko, who proclaimed, “If you want a friend, get a dog.” This provoked both laughs and sighs, but in the real world, this attitude makes for a very lonely Ebenezer Scrooge-type life for the boss and a shallow existence for employees who must spend more than half, at the very least, of their Monday through Friday waking hours working.
At times, people can be difficult, both to work for and with. However, it’s the people who make the company and relationships that combine respect and a form of e-friendship that can make the real difference.
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. Reach him with comments at email@example.com.
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Richard Branson is full of big ideas. The man who founded six companies that each rake in more than $1 billion annually dares to think big. For him, it’s all about the experience, making a difference and not doing things the same way as the competition. An idea captures his imagination and he sets out to turn it into reality.
For him, it’s not about the money. It never has been.
When he sees a situation where he thinks he can make a difference in people’s lives, he looks for a way to make a difference. He understands that “why” he is doing it is more important than the “what” or the “how.”
Author and consultant Simon Sinek agrees (see video link). He explains that Apple is wildly successful at what it does not because it can build computers better than anyone else but because it understands “why” it is doing so. It’s not that the competition doesn’t know what it is doing or that it doesn’t have talented people creating good products. It’s just that Apple understands why it is in business and focuses its message on that instead of what it does — which is build electronic devices.
Sinek says that people like to do business with people who believe what they believe, so they buy more on the “why you do it” rather than what you are actually doing. Notice that profits are secondary. If you do things the right way for the right reasons, profits come naturally.
You might already have a big idea for your business, but it will most likely never reach its full potential unless you understand why you are doing it. Have you ever stopped to think about why you are in business or why you are doing what you are doing? It can be an enlightening exercise.
With the demands of daily business, we seldom stop to think about the reasons behind our actions, and if we do think about it, the answer is often “to turn a profit.” But to what end?
When you understand why you are trying to make a profit and the answer goes beyond simple wealth, then you are getting to the heart of what differentiates a good business from a great one. Maybe the reason why is a social issue, such as eliminating hunger, or maybe it’s a medical issue, such as curing a disease. But it doesn’t have to be grand. The “why” can be something like “making computers easy for everyone to use.” The important part isn’t the scope; it’s understanding your business’s basic reason for existence.
When you’ve taken the time to understand that, your business will have the potential to do great things because employees and customers alike can unite around a common understanding.
It’s why Apple is a great company and it’s why Richard Branson is wildly successful. If you’re already doing it, you’re on your way. If not, take the time to think about it.
Fred Koury is president and CEO of Smart Business Network Inc. Reach him with your comments at (800) 988-4726 or firstname.lastname@example.org.
No matter what size your business, your employees probably rub elbows a bit in their workspace. It’s both a fact of life and of space limitations. If you create the right company culture, they’ll become more like a functioning family than a bunch of bickering siblings.
But even the most collaborative colleagues will wrestle with pet peeves from time to time. Whether it’s impromptu office social hours that are too close for comfort or phone chatter happening at a few decibels too many, noise pollution tops the list of many workers’ gripes about their neighbors.
At Petplan, we’ve tackled this topic head-on, as our employees share an open workspace that encompasses a call center, claims adjusters, a marketing and creative team, a sales force and managers alike (not to mention our four-legged office mates).
With so many people working for so many different facets of the business, it takes a delicate balance of tolerance and consideration to keep varying noise preferences in check. Here are some of the lessons we’ve learned — loud and clear — about sounding off at work.
If you love them, set them free
Setting up your staff so everyone has the option to “go mobile” will help ease tensions when exuberance reaches intolerable proportions for quieter folks. At Petplan, all of our employees have a laptop they can take to less high-traffic areas, such as meeting and conference rooms, if they need some serenity during the day.
Carving out a few quiet places within the workspace gives your employees the option to retreat when they need to nix the noise and get down to business.
Open Pandora’s Box
Streaming music or white noise can greatly reduce the stress of a noisy co-worker and help increase focus and concentration, so we’ve adopted a permissive policy regarding headphone use by employees.
Drowning out the distraction is sometimes enough to manage the situation and keep frustrations in check, and studies have shown that music in the workplace can actually boost motivation and increase productivity. If bandwidth is an issue and you need to block Pandora or other music-streaming sites, radios (with a headphone jack), iPods and CDs can still do the trick.
Communication is key
Create opportunities for regular social interaction among your employees, across all departments. At Petplan, we host a handful of employee outings throughout the year, but we also encourage everyday mingling, with perks like picnic lunches and Friday cupcakes.
Fostering friendships — or at least friendly acquaintance-ships — can help workers manage differing noise preferences themselves. After all, it’s much easier to ask someone you’re friendly with to keep it down than someone you don’t know well.
Practice strategic eavesdropping
At Petplan, being able to hear everything has at times been beneficial. Our marketing department overhears our sales force answering common questions, which has helped shape some of our prospect communications. Our claims manager can hear our “happiness managers” servicing policyholders with pending claims, which has given her better insight into the customer experience.
Never underestimate the power of strategic eavesdropping — mining the melee for useful information can often turn up gold.
As the saying goes, you can’t please all the people all the time, so no matter how you try to accommodate your employees, there are bound to be issues around noise levels in every office. Acknowledging and making allowances for varying preferences can help solve some of the discord, but if all else fails, consider adopting an officewide noise management policy.
As part of an overall approach to providing a positive working environment, an official policy can help make sure everyone’s noise concerns are — ahem — heard.
Natasha Ashton is the co-CEO and co-founder of Petplan pet insurance and its quarterly glossy pet health magazine, Fetch! — both headquartered in Philadelphia. Originally from the U.K., she holds an MBA from the University of Pennsylvania Wharton School of Business. She can be reached at email@example.com.
In a way, John Myers is not unlike the guy who paints the foul lines at the local baseball field. He defines boundaries.
The president and CEO of Rentokil North America, the regional wing of Rentokil Initial — a U.K.-based facility management company that provides, among other things, pest control services — has been tasked with integrating a company that has changed dramatically over the past decade. At one point, Rentokil’s North American footprint consisted of about a dozen operations sprinkled throughout Ontario, the Mid-Atlantic States and Florida.
Then, over the span of two years, Rentokil acquired a trio of pest control companies. With the acquisitions of Ehrlich, Presto-X and Watch All between 2006 and 2008, Rentokil’s growth exploded. The company expanded to nearly 80 locations in 35 states.
But with those acquisitions came differing cultures, policies and processes. Myers had to get everyone aimed in the same direction.
“Most people will tell you that acquisition plans and models fail because the integration wasn’t done as defined,” Myers says. “But it can be really hard to do. You have disparate businesses with long histories and a strong belief in their culture, and there is either a reluctance to integrate or companies integrate too quickly and kind of throw the baby out with the bathwater.”
Myers had to figure out a way to balance the best practices of the acquired companies with the need to create a uniform set of objectives and values under the Rentokil umbrella.
“When I first started here, I was new to the business and rather agnostic toward each of the brands,” says Myers, who took over the company at the end of 2008. “What I saw was that everyone agreed that we needed to change, but when I started making changes, they all said, ‘No, what we meant was, you need to change those guys over there.’ Everybody wants to change; they just don’t want it in their area, because change is hard.”
Myers solved the challenge by starting at the top, with his own leadership team, and working his way down.
Identify the themes
Myers needed to simplify things. With bits and pieces of varying cultures, processes and objectives fluttering around the company like pieces of confetti, he had to vacuum everything up, sort it out, keep what was relevant and discard the rest.
It’s a process that requires a set of ground rules. And those ground rules are formulated on the management level.
“It’s tricky, because these have been successful businesses in their own right, and they’re used to doing things their own way,” Myers says. “The natural tendency is to say that you’ve been successful using the techniques you already had in place, so why would you want to change?”
To combat that type of resistance, Myers gathered his leadership team and tasked them with helping him set the strategic vision for the company — a long-range vision to serve as a set of end goals for every business unit. Any goal or strategy that existed among the acquired companies needed to help Rentokil progress toward its strategic vision. If it didn’t, Myers’ team would discard it.
The strategic vision sessions also helped identify areas of the acquired companies that aligned along common themes, giving Rentokil an area of strength to leverage.
“The good news is, we really looked at our businesses and realized they had some very common elements in their cultures that we could rally behind,” Myers says. “For example, we believe in providing the highest level of customer service in the marketplace, and not everybody believes that should be a part of their strategy.
“As an example, you can compare a small hardware store to Home Depot or Lowe’s. The small hardware store will give you personalized service. Home Depot or Lowe’s — while they’re both very successful companies — might provide a different level of service while trying to compete more on product selection or price. We are more like the smaller hardware store in that we’ve made customer service part of the culture of the business.”
Customer service became one of the five strategic thrusts for Rentokil, as outlined in the plan formed by Myers’ team. Along with customer service, Rentokil also formed objectives around organizational capabilities, operational excellence, operating at the lowest cost possible while still maintaining high service standards and delivering profitable growth.
The development of the five strategic thrusts was critical for Rentokil and any other company trying to define its future strategy and goals. Once the pillars of the strategy are defined, you have to allow the company to be guided by those principles over time.
“The reason these themes are important is, as we work on tactics, if we can’t easily slot something we’re working on under one of these, we shouldn’t be working on it,” Myers says. “That is why it’s important to maintain those thrusts.
“In a change management environment, you can’t change the themes every day. You can’t have a flavor of the month, because people will start to get confused and question whether your strategy and objectives are real. We just finished the third year in which we’ve operated under the same five strategic thrusts.”
Roll it out
With the playing field outlined by the strategic pillars you have constructed, your next step is to tell the entire organization how it will accomplish the goals related to those pillars.
Myers began by rolling the plan out to everyone on the management level of the organization, followed by a rollout to the organization at large.
“First of all, we have an annual management meeting where we present our key tactics under each of the strategic thrusts,” Myers says. “I present the thrusts, then I present the initiatives that we are going to implement in the coming year to support the strategic thrusts. We stand in front of our entire management team and tell them what we are going to do.
“The second thing we do is we then have regional meetings in which every colleague in the company attends, and we make the same presentation. Every technician, every sales representative, every office manager, from front-line colleagues all the way to the top, are all hearing the same message, and they’re hearing it from the executive leadership team.
“Usually, I have a vice president on my team go out and present this material to every colleague, face-to-face.”
After the initial rollout, you have to perform frequent maintenance in the form of direct communication from the top. Myers reinforces the strategic thrusts and tactical initiatives through monthly CEO messages, delivered to the entire Rentokil organization throughout North America.
“I’d say nine of the 12 messages I have each year relate to a strategic thrust and one or more of the initiatives associated with it,” he says. “So I will say simple things like, ‘As you know, we believe in delivering outstanding customer service. So today I’d like to talk to you about a new initiative that was launched just last week. We talked about it at our recent company meeting, but I want to give you an update.’
“It’s the old idea that you have to tell them and tell them again, because people are busy in the day-to-day world. You need to reinforce the idea that there really is a plan and you are following it.”
The message needs to come directly from you as the head of the organization. The further down the ladder you delegate your reinforcement communication, the less impact it will have. That’s not to say communication involving a department head or direct supervisor is irrelevant, but on matters that involve the direction of the whole company, your words carry the most weight.
“There are two main reasons why this kind of communication has to come from the top,” Myers says. “First off, I go back to the fact that everyone is busy and working hard, so getting a reminder of what the top boss thinks is important helps to refocus what you work on. It’s like you always hear about finding out what’s important to your boss and working on that.
“The second thing is, it’s reassuring to the organization to be reminded that there is a plan, and we’re sticking with it. You’re not trying to figure out what you’ll do each month.”
Myers’ unification plan has taken root and helped propel Rentokil’s growth. The company generated $350 million in North American revenue during 2011 and continues to maintain a strong market share in its space.
“Ultimately, people are motivated to buy in to a plan when they know three things: What are the expectations, how are we doing against those expectations and what are we going to do to get better in the areas where we’re not delivering at the level we want?” he says. “When there is clarity around the plan, there is greater opportunity to implement the plan in a timely and effective manner. By reinforcing the message from the top level, it does those things better than just hoping it happens.” ?
How to reach: Rentokil North America,
(610) 372-9700 or www.rentokil.com
The Myers file
Education: B.S. in marketing, University of Vermont; MBA, Mercer University, Atlanta campus.
What is the best business lesson you’ve learned?
I’ll give you two. The first one is to share the risk as well as the reward. I’ll never forget a job I once took in sales management. I was new to the company where I was working, and I decided I would negotiate a deal with a customer myself. It didn’t go well. My dad told me that I wanted to show everybody that I could do it myself, but it’s not about that. It’s about the team delivering the desired result. That should have been the goal, not me trying to ensure that I’d deliver the result myself. I should have brought other people onto the project.
The second thing is knowing that everyone wants to do a good job. Your role is to ensure that everyone knows the expectations, knows how they are performing against those expectations and knows how you’ll work together to improve the things that aren’t working out.
What traits or skills are essential for a business leader?
I get asked that all the time by college graduates. The first thing I always tell them is to lead with humility. My view is that our frontline colleagues and customers know what is needed in the marketplace, and it takes humility from the leadership team to remind yourself of that fact. You have to have the humility to ask for insight and advice from the people closest to the customers.
What is your definition of success?
Success is utilizing really strong methods to deliver strong results. We use a phrase here that I like in our leadership training: Success versus excellence. If the concept of your methods is robust, the predictability of your success is better.
It’s like in golf. You can hit a good shot once in a while, but you can’t repeat it if your swing isn’t good. You can sometimes find success with bad methods, or you can consistently find success with good methods.
According to Merriam-Webster, management is “the process of dealing with or controlling things or people.” While “controlling” is a bit harsh in my book, the definition is correct in it's focus on management of people. To be a good manager or team leader, you have to have an above average interest in people. Success in management is found in the relationship developed between leader and team.
The best managers see themselves as catalysts. They become that agent or force that provokes or speeds significant change or action. These managers get things done quickly by leading with solid people skills.
Here are 4 people skills that every good manager must possess:
1. Understanding the right way to give a critique.
The worst thing you can do if you want to get someone to listen to you is to criticize.
As human beings, we hate to be criticized. When we feel attacked, we usually attack back – even when we are in the wrong. Many of us fall into the trap of thinking “I know I am right and I am going to prove it to you.”
Over the years I have learned that this way of thinking simply does not work.
A good manager has the self-control and presence of mind to put aside the needs of his own ego and say “I've got a problem, will you help me?” Enlisting cooperation in this manner will always lead to better results.
2. Understanding the need to help.
If someone comes in to criticize you or to raise your game, under what circumstances would you be willing to accept the critique?
The answer for me is simple. If I think someone is really trying to help me, then I'll engage and listen.
On the other hand, if I feel that the person is just trying to get the job done or make himself look good, I may listen, but my heart will not be in it. My interest and creative energies will be lost.
The truth of the matter is: Managers will only have influence over their people to the extent that their people think they are sincerely trying to help them. It is simply the way human beings work. Good managers truly care about their team and work hard to help them.
3. Understanding no two people are the same.
As a manager, you do not influence everybody the same way. People do things for their own reasons – not for others and not for you.
Inspiring people to your company vision happens best when you help them to see what's in it for them. This varies from person to person. It is your job to discover what things motivate each member of your team.
Some people are motivated by a challenge, some by money and others by recognition.
It is about reading their needs, desires and wants and then leading in such a way that ensures their success at obtaining them.
4, Understanding the best way to get tasks completed.
An effective manager realizes that each time he has an interaction with someone about a task, there are two things going on:
a. A discussion about the task and how to get it done.
b. The way in which the interaction affects the managers relationship with the collegue.
The first is pretty straightforward, but it's success is determined by the tenor of the second.
It must be said that the task should not be sacrificed for the relationship at all costs. It must also be said that winning on the task is not good if the manager ruins the relationship. Both are important and the manager must do well in each area.
I refer again to the need for the manager to develop relationships with the team in order to understand the best way to get things done according to individual members needs, desires and strengths.
In the end, good managers know how to use their influence and power to help others achieve beyond their wildest dreams.
I like management guru Tom Peters' definition of power:
“My definition of power is understanding that all of managing — and this comes out of the old grade school book — is the notion of doing more than you and I can do by ourselves; that is, doing things through other people.”
He goes on to say:
“If you are interested in getting things done effectively and imaginatively through other people then what you're trying to do in the workplace is exactly what you're trying to do on the football field – which is to get people who work with you to achieve beyong their wildest dreams.”
Workplace managers understand that good people skills determine their success. They work hard to develop the skills needed to lead in ways that shows their interest in people.
DeLores Pressley, motivational speaker and personal power expert, is one of the most respected and sought-after experts on success, motivation, confidence and personal power. She is an international keynote speaker, author, life coach and the founder of the Born Successful Institute and DeLores Pressley Worldwide. She helps individuals utilize personal power, increase confidence and live a life of significance. Her story has been touted in The Washington Post, Black Enterprise, First for Women, Essence, New York Daily News, Ebony and Marie Claire. She is a frequent media guest and has been interviewed on every major network – ABC, NBC, CBS and FOX – including America’s top rated shows OPRAH and Entertainment Tonight.
She is the author of “Oh Yes You Can,” “Clean Out the Closet of Your Life” and “Believe in the Power of You.” To book her as a speaker or coach, contact her office at 330.649.9809 or via email firstname.lastname@example.org or visit her website at www.delorespressley.com.
It’s common for businesses to attain some measure of success and reach a point where they need to take strategic action in order to continue to grow.
“Basically, you’ve run the business to a certain point. What do you do next with a successful company? You could sell it, just keep the status quo — which I don’t think is a good idea — or you could grow it,” says Mario O. Vicari, director at Kreischer Miller.
Vicari says there are four options owners can consider to keep growing: Acquire a similar company; diversify by acquiring a company in a different industry; leverage what you have by figuring out how to cut costs or increase efficiency; or leverage your position by expanding into new markets.
“There could be a lot of different strategies under these four areas, but that covers the basics,” says Vicari. “Another option is selling the business. Maybe there is a point where the market is right to sell, but that has a lot to do with the personal goals of the owners.”
Smart Business spoke with Vicari about the different growth strategies and how they are implemented to build companies.
How do you leverage assets or market position to grow?
You can figure out how to do things better or more efficiently; that’s leveraging intangible capital. Every business also has tangible assets such as machines and buildings, and you can look at whether you can use those assets in different ways. Those might be line extensions or new products that you make with your existing technologies and hard assets.
Instead of focusing on assets, you can look at market position and ways to take share from competitors, assuming, for example, that it’s a billion-dollar market and you have a 10 percent share of a pie that isn’t getting bigger. You could take market share by expanding the sales force or distribution channels. For instance, if you’re only distributing in the northeast, you could open a distribution site in Indianapolis.
Another way to leverage your position is to look at existing customers and see if there are products they buy that you’re not presently selling but are close enough to your product line that you could. For instance, if you distribute HVAC equipment, you might want to expand your line and start selling water heaters.
What are the different acquisition strategies?
When you grow by acquiring a similar firm, it’s because they have different characteristics, such as geography or products, which complement the position you have. Maybe they give you a footprint in another three states. Or maybe they do commercial HVAC rather than residential.
You can also diversify through acquisition — for example, an HVAC company gets involved in home alarm systems, which is an entirely different business. Some businesses like diversification as a risk management strategy because you’re not concentrated in one industry. But the reality is it’s often very risky because it takes you outside of your core competency and it’s not easy to operate a business without experience in the industry.
Is it ever OK to stop growing your business?
It’s OK to maintain your position as long as you maintain your margins. The problem is that a lot of companies fall into doing nothing, not because they intentionally decided to do so, but because they become complacent.
Ninety percent of the time, companies in the status quo category tend to be there because they’re comfortable and not putting pressure on themselves to grow. That’s a dangerous place to be because when you have no goals or plans to improve your business you could wind up diminishing its value.
Mario O. Vicari is director at Kreischer Miller. Reach him at (215) 441-4600 or email@example.com.
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As the Patient Protection and Affordable Care Act (PPACA) implementation unfolds, health lawyers continue to answer employers’ questions about its impact.
“The act has multiple potential penalties for failure to comply with its various requirements. The risk of not complying is a financial risk,” says Jules S. Henshell, of counsel at Semanoff Ormsby Greenberg & Torchia, LLC.
Smart Business spoke with Henshell about what employers need to be aware of as they take their next steps under the PPACA.
What do employers most frequently ask?
The most frequent questions relate to the ‘pay or play’ penalties in the law. The majority of employers are currently providing health care coverage through group insurance plans. However, it’s too early to determine whether to provide coverage at levels required by the act or pay the penalties because future premium costs and the affordability of employer offerings through health exchanges are uncertain.
Employers also are concerned about reporting health care benefits on W-2 forms, whether they qualify for transitional relief, and the provisions against discrimination in favor of highly compensated individuals.
What’s important to know about W-2 reporting and IRS transitional relief?
In 2012, employers are required to report health care costs to the employer and employee on employee W-2 forms or face a $200 per-form penalty.
The IRS has provided transitional relief from reporting for employers that file fewer than 250 W-2 forms. Some employers question if they are entitled to relief from reporting when their company files fewer than 250 W-2 forms but is one of a number of related companies. The IRS’s informational Q&A suggests that it will not aggregate among related companies to calculate the threshold for reporting.
Whether the W-2 reporting currently applies or not, it’s a good idea to formalize the practice of tracking these health insurance costs to better enable retrieval of information in the future.
How do provisions about non-discrimination impact employers?
The PPACA prohibits discriminatory practices in favor of highly compensated individuals. Prohibited practices include providing benefits to highly compensated individuals that are not provided to other employees as well as affording greater choice, higher amounts, lower premiums, a higher employer subsidy or more favorable benefits. Many companies have used such practices to create competitive compensation packages for executives and management. Penalties include an excise tax or civil monetary penalty or civil action to compel provision of nondiscriminatory benefits.
The IRS, U.S. Department of Labor and U.S. Department of Health and Human Services (HHS) have stated that non-discrimination requirements will not be enforced until the first plan year after regulations are issued. And so far, they have not issued regulations.
Employer health plans with grandfather status are not impacted, but should be conscious of how their status could be jeopardized. Raising co-insurance, significantly raising co-pays and deductibles, lowering employer contributions, and adding or tightening annual limits on what the insurer pays will result in loss of grandfather status. Those without grandfather status need to review their compensation packages and practices in anticipation of future regulation and enforcement.
Do any significant PPACA cases remain?
The most active litigation challenging the PPACA in multiple jurisdictions target the requirement that new, non-grandfathered group insurance plans provide contraceptive coverage. The lawsuits focus on alleged violations of either the First Amendment right to free exercise of religion or the Religious Freedom Restoration Act.
Regulations have granted exceptions for certain religious employers and provided a one-year safe harbor for religiously affiliated institutions that wouldn’t otherwise qualify for exemption. HHS has stated it will provide further accommodations before the end of the safe harbor period.
Jules S. Henshell, of counsel, Semanoff Ormsby Greenberg & Torchia, LLC. Reach him at (215) 887-3754 or firstname.lastname@example.org.
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