Monthly Archives: August 2015

August 2015 Newsletter – Getting and Keeping Top Employees

Getting and Keeping Top Employees

This month Netflix introduced an unlimited paid family leave program within certain of its divisions for new parents for the first year after the birth or adoption of a child. Employees will continue to get their normal pay and have the option to take time off, work part time, or full time during that year. There is no national requirement for paid new family leave, only 12 weeks of unpaid time off.

Netflix, which is headquartered in Silicon Valley, California felt it needed to do this to compete with other tech companies for talented personnel. In intensely competitive Silicon Valley that may be necessary, but for a company anywhere in the world the real question is – what does it take to get and keep top employees?

A 2015 Employee Recognition Report by the Society for Human Resource Management and Globoforce stated that employee retention and the overarching area of employee engagement were the greatest problems facing organizations.

In this article I would like to focus on one of the top steps that companies can take to ensure they recruit and retain top staff. The great news is this step does not cost a company an enormous amount – maybe even nothing.

Why Does Your Staff Come to Work Each Day?

Truett Cathy, the founder of top ranked customer experience Small Business Planning in Atlanta, GeorgiaChick-fil-A many times said the purpose of business is to meet your customer needs. According to noted author Peter Drucker the “The purpose of business is to create and keep a customer.”

To do this you must consistently meet your customer’s needs related to your product. Furthermore, if you meet your customer’s needs effectively and efficiently you will be ensured of operating profitably. In other words, the true purpose of a business is not to make money or “maximize shareholder value” – as many business schools teach.

This is so important because many studies have shown employees tend to be engaged in a business and want to continue to work for it if they feel the company is honestly making the lives of their customer better. This leads to your staff becoming an “advocate” for your customer.

The ramifications of this advocacy are huge. Front line customer service personnel want to solve your customer’s problems, not just half-heartedly answer the telephone. Sales people want to do what is best for your customer, not just make a sale. Manufacturing personnel do all they can do to ensure error free products are produced by your company.

Design staff try to look at things from the customer’s point of view. Administrative personnel realize they are there not to just get paid, but to make sure the entire operation works smoothly so the customer can get what they are looking for. In other words, when a business truly communicates to its staff an appealing purpose for being other than just making money, good things happen.

Engaged Employees Go the Extra Mile

Small Business Planning in Atlanta, GeorgiaEngaged employees regularly go the extra mile to deliver what your customer is looking for. Their enthusiasm rubs off on other employees and on customers. They provide better experiences for your customers by approaching their job with energy. This enhances productivity and causes them to come up with creative product, process and service improvements.

This is because engaged employees almost automatically focus their energy on the tasks and activities that will produce the outcome you desire for your customer. This passion results in satisfied customers who purchase more, continue as customers and become the company’s advocate by telling others about it. This all yields additional revenue and profits.

Engaged employees also remain with their employer for the long haul which reduces the cost of employee turnover.

Studies have shown companies with highly engaged workers revenues grew two and a half times as much as those with low engagement levels. Additionally, the stock market rates of return of companies with a highly engaged workforce were three times greater than the market average.

Producing Fully Engaged Employees

You begin to create engaged employees by discovering and then conveying to your staff how your company is serving your customer and making their life better. The root of this step goes back to why you originally started your company. Almost all business owners began their company for very pure and altruistic reasons. It may have been because you saw people not managing their finances correctly and losing their home.

Or someone getting cancer and needing a person who had theSmall Business Planning in Atlanta, Georgia medical skills to assist them. Or you may have observed companies struggling because they needed a low cost way of getting their products shipped to their customer. It is so easy for business owners and leaders to lose sight of their original purpose and get caught up in the minutia of running a company and trying to make a profit.

Then tell your story to your staff in a motivational and emotional way that connects your personnel and their tasks with the big picture of what you are trying to accomplish.

Making Your Customer’s Life Better

Share how serving your customer makes not only your customer’s life better, but also the world better. Disney is a great example. Their amusement parks make their customer’s lives happier, but they also make the world better place. No doubt your business does the same.

For instance, one of our clients is a Holiday Lighting company and their beautiful lighting displays make their customer’s lives happier. But also as their neighbors drive by the displays the spirits all of who see them are lifted – which adds to the “magic” of the Holiday Season.

Another good action is to put up pictures of your “customers” on the walls of your workplace to remind your employees what this is all about – making these people happy and fulfilling their needs. Also, you will want to periodically put up new pictures so that your customer’s image stays fresh in their mind.

Lastly, share success stories of how your company has met various customer’s needs. These may be testimonial letters that came in from customers, discussions you have had with your clientele or dialogues your staff has had with your patrons.

By taking these customer focused actions you will begin to obtain fully engaged employees that will produce satisfied, long-term customers who will become your company’s advocate by telling others about you. The bottom line result of this will be additional revenue and profit for your company.

If you need assistance with getting your employees fully engaged with your company please contact us so we can show you how to use this concept to tremendously increase your revenue and take your business where you want it to go.

Fountainhead Consulting Group Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm that during the past 17 years has shown over 1,200 companies how to achieve the goals for their business by using our unique, comprehensive and systematic business planning and growth methodology, the Structure of Success™ so they can Work Less, Make More and most importantly Have Fun in Their Business.

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

Office phone: (770) 642-4220

July 2015 Newsletter – Score Keeping Your Business

Score Keeping Your Business

If you were in our office about a month ago you would have found me in a meeting with Paul, a tall, thin man in his mid-thirties who owns an equestrian business. During the meeting Paul said to me, “late last year I changed the direction of my business…” I said “great, let’s see how you are coming along with the new direction”. In other words, let’s looks at the numbers for your business.

Determining and tracking where an organization is financially at, is the purview of the Finance area of a company. Although some business owners and leaders may find finances unappealing and boring, it is absolutely critical to a business because if you do not pay proper attention to this function, you may run out of money and never achieve the dreams for your company.

Bear in mind the accounting, finances and financial reporting of an entity are not an end in themselves, but strictly a means to an end. In reality the true function of your Finance and Accounting area is it provides the “score keeping” of your business. But what are you keeping score of?

  • Are you on track for achieving the Vision for your company?
  • What is happening with regards to meeting the goals for your business?
  • How are you doing with the execution of your business plan?

Three Score Books

This score keeping function involves different score books:

  • Financial Statements
  • Metrics
  • Ratios

Financial Statements consist of your main two financial statements, an Income Statement and a BalanceSmall Business Planning in Atlanta, Georgia Sheet – that are in turn produced on a periodic basis.

Metrics are the internal measurements of your business’ “systems” that indicate whether or not your systems are operating correctly.

Ratios are measurements that mainly use Financial Statement information to calculate values that are compared to other companies or industry averages.

For our remaining discussion I would like to focus on the first scorebook and lay the foundation to help you to understand what your Financial Statements are telling you about the health of your business.

With regards to your finances there are five main things you want to know about your company:

  • Are you making a profit or loss?
  • Are you managing your assets (Cash, Accounts Receivable, Inventory…) properly?
  • Are you funding your business in the most advantageous way?
  • Do you have the information to make strategic and tactical decisions?
  • How can you operate your business in the best possible manner?

To understand your Income Statement and a Balance Sheet you need to be aware that your Chart of Accounts, which is the foundation of your accounting system, is separated into six different types of accounts, namely:

  • Assets
  • Liabilities
  • Equity
  • Revenue
  • Costs of Sales (or Cost of Goods Sold)
  • Expenses

Balance Sheet

Small Business Planning in Atlanta, GeorgiaFurthermore, your Assets, Liabilities and Equity are shown on the aforementioned Balance Sheet. To understand how the information is presented on a Balance Sheet you have to know that the Assets of a business always equal the sum of your Liabilities plus Equity. Therefore, using algebra, we can determine that when you take a business’ Total Assets and subtract its Total Liabilities, you end up with the business owner’s Equity.

Obviously your Assets (Checking Accounts, Accounts Receivable, Inventory, Equipment…) are good things. Versus your Liabilities (Accounts Payable, Credit Card Payables, Payroll Taxes, Loans Due, Notes Payable…) are generally bad things and your Equity is how much “skin you have in the game”.

Keep in mind that your Balance Sheet shows its information as of a certain date. Therefore, it is like a snap shot picture of your company’s financial health as of that particular date. If you compare your Balance Sheet from one date to another date, you can see how the health of your company has improved or deteriorated in terms of the changes to your Assets, Liabilities and Equity. This is called a Comparative Balance Sheet and it is like having your lab tests done with your periodic physical and then comparing how your Glucose, Cholesterol and Triglycerides, etc. have changed during that time period.

Income Statement

Your second Financial Statement is an Income Statement and it shows your Revenue, Costs of Sales and Expenses. Its formula is your Revenue minus your Costs of Sales and Expenses yields your Profit or Loss which is the final number of the bottom of the Income Statement, hence the term the “Bottom Line”. An Income Statement always shows financial information for a period certain of time, therefore it is like a movie of your Revenue, Costs of Sales and Expenses for that period of time.

When used together your Balance Sheet and Income Statement can be used to assess the overall health of your business and see what the “score” is how you are doing at accomplishing the goals for your business.

Customer Relations Manager

Lastly, there is one other tool that I recommend you use for score keeping in your company and this is aSmall Business Planning in Atlanta, Georgia Customer Relations Manager or CRM for short. While your Balance Sheet and Income Statement tell you very well where you have been and where you are at, they don’t tell you where you are going. Your sales prospects, sales funnel and upcoming sales predicts where you will be at as far as the health of your company. Therefore, we recommend using a CRM, such as the package by Results Software to systematize your Marketing and Sales functions and keep score of how you are doing in this all important area.

In summary, use your Balance Sheet, Income Statement and Customer Relations Manager to understand what the health of your company is and keep score of how you are doing at accomplishing the goals for your business.

If you need assistance with “score keeping” and fully understanding the health of your business please contact us so we can show you how to use this concept to tremendously increase your revenue and take your business where you want it to go.

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

Office phone: (770) 642-4220