Business Banking E-Newsletter - January 2012
Top 10 New Year’s Resolutions for Business Success
The end of the year is a good time to reflect on your business's progress over the past year and plan how you want your business to develop. Do you want increased success in the coming year or the chance to enjoy the success you've achieved more? These top 10 New Year's resolutions are designed to help you strike a better work-life balance, so you can achieve a truly satisfying success in the New Year.
1) Learn how to delegate and do more of it.
There are so many things to do when you're running a small business, it's easy to delude ourselves that we need to do all of them. Then we wonder why we're so tired and frazzled and have no time to do anything else! Determine Your Personal Return on Investment, and decide to let someone else do some of the tasks for a change. Delegation is the key to a healthy work-life balance.
2) Promote your business regularly and consistently.
Too often the task of promoting a small business slips to the bottom of the to-do list in the press of urgent tasks. If you want to attract new customers, you have to make promotion a priority. Make a New Year's resolution to hire a marketing expert, or take the time to create a marketing plan on your own and follow through.
3) Make business planning a weekly event.
Planning is vital if you want a healthy, growing business. Business planning lets you take stock of what worked and what didn't work, and helps you set new directions or adjust old goals. So why do it just once a year or once a quarter? Set aside time each week to review, adjust, and look forward - or even better, make business planning a part of each day. Not only will this help you avoid costly mistakes and stay on track, but you'll feel more focused and relaxed.
4) Learn something new.
What you choose to learn may be directly related to your business or completely unrelated. Learning something new will add to your skills and add a new dimension of interest to your life - another important part of achieving a healthy work-life balance. Depending on how you choose to learn, you may meet new and interesting people, who may become customers, colleagues, or friends. How will you find the time to learn something new? By delegating, remember?
5) Join a new business organization or networking group.
There's nothing like talking to other business people for sparking new ideas, refining old ones, and making contacts. Whether it's a group specifically designed for networking or an organization dedicated to a particular type of business, in person or over the 'Net, making the effort to be a part of a group will revitalize you and your business.
6) Give something back to your community.
There are all kinds of worthy organizations that make a difference in your community. Make a New Year's resolution to find a cause that matters to you, and give what you can. Make this the year that you serve on a committee, be a mentor, volunteer, or make regular donations to the groups in your community that try to make the place you live a better place. And those that give get.
7) Put time for you on your calendar.
It is important to take the time to recharge and refresh yourself; a healthy work-life balance demands time out. All work and no play is a recipe for mental and physical disaster. So if you have trouble freeing up time to do the things you enjoy, write time regularly into your schedule to "meet with yourself" and stick to that commitment. If you won't invest in yourself, who will?
8) Set realistic goals.
Goal setting is a valuable habit - if the goals lead to success rather than distress. Make a New Year's resolution that the goals you set will be goals that are achievable, rather than unrealistic pipe dreams that are so far out of reach they only lead to frustration.
9) Don't make do; get a new one.
Is there a piece of equipment in your office that's interfering with your success or something that you lack that's making your working life harder? Whether it's an old fax machine that's a pain to use, or the need for a new employee to lighten your work load, make a New Year's resolution to stop putting off getting what you need.
10) Drop what's not working for you and move on.
All products aren't going to be super sellers, all sales methods aren't going to work for everyone, and all suppliers or contractors aren't going to be ideally suited to your business. If a technique or a product or a business relationship isn't working for you, stop using it. Don't invest a lot of energy into trying to make the unworkable workable. Move on. Something better will turn up.
Achieving a healthy work-life balance is like maintaining a good relationship; you have to keep working on it. But if you apply these New Year's resolutions throughout the year, you will find success!
Article Source: http://sbinfocanada.about.com/cs/management/a/bizresolutions.htm
How to Reengage Your Employees
A recent human resources study found that an alarming 70 percent of workers feel disengaged from their jobs. A big reason for this, the researchers found, was that just 34 percent of the 700 workers who participated in the study feel confident in the future of the organization they worked in.
Sure, we know we can blame the struggles of the economy for people feeling down about their jobs and their future. It’s tough to pick up a newspaper or turn on the TV without hearing about some business going under. Worse, with companies making cuts in everything from health care benefits and 401(k) contributions to training budgets, folks likely feel like just another number in the eyes of their employers. But just as depressing is the thought that 70 percent of our country’s workforce might literally be sleepwalking through their jobs. That’s not good for business and it’s not good for the employees. But what are we supposed to do about it?
The good news is that there is plenty you can do about tackling this problem. The answer begins by building a company culture that actively cultivates employee engagement. But building employee engagement doesn’t require magic or even a lot of capital. What it does require is a heck of a lot of communication. Kick-starting “the circle of growth,” then, begins with these three basic steps:
1. Make employees feel secure. It’s critical to let employees know that you believe in them, especially in tough times. That means you need to be constantly communicating how valuable their contributions are to the company.
2. Stick to your company’s core values. All of us respond better when we’re tackling something that has a purpose larger than ourselves. That’s why it becomes essential to continually communicate your organization’s mission, vision, and values as a way to inspire and bond everyone to a meaningful cause.
3. You’re in this together. While it might be hard to see it now, tough times always make us stronger. You need to work on getting that message across to every member of your organization while also giving them the confidence to begin identifying all the opportunities the company has rather than just the threats.
Building a culture of engagement is not an easy fix: It’s going to take commitment, mistakes, hard work, and yes, plenty of fun.
Source: Inc.com - Paul Spiegelman
9 Things That Motivate Employees More Than Money
The ability to motivate employees is one of the greatest skills an entrepreneur can possess. Two years ago, Illya Pozin, founder of Ciplex, a digital marketing and creative agency realized he didn’t have this skill. So he hired a CEO who did.
Josh had 12 years in the corporate world, which included running a major department at Comcast. Illya knew he was seasoned, but was still skeptical at first. They were going through some tough growing pains, and he thought that a lack of cash would make it extremely difficult to improve the company morale.
He was wrong.
With Joshs’ help and the help of the great team leaders he put in place, Josh not only rebuilt the culture, but also created a passionate, hard-working team that is as committed to growing and improving the company as Illya is.
Here are nine things he learned from him:
Be generous with praise. Everyone wants it and it’s one of the easiest things to give. Plus, praise from the CEO goes a lot farther than you might think. Praise every improvement that you see your team members make. Once you’re comfortable delivering praise one-on-one to an employee, try praising them in front of others.
Get rid of the managers. Projects without project managers? That doesn’t seem right! Try it. Removing the project lead or supervisor and empowering your staff to work together as a team rather then everyone reporting to one individual can do wonders. Think about it. What’s worse than letting your supervisor down? Letting your team down! Allowing people to work together as a team, on an equal level with their co-workers, will often produce better projects faster. People will come in early, stay late, and devote more of their energy to solving problems.
Make your ideas theirs. People hate being told what to do. Instead of telling people what you want done; ask them in a way that will make them feel like they came up with the idea. “I’d like you to do it this way” turns into “Do you think it’s a good idea if we do it this way?”
Never criticize or correct. No one, and I mean no one, wants to hear that they did something wrong. If you’re looking for a de-motivator, this is it. Try an indirect approach to get people to improve, learn from their mistakes, and fix them. Ask, “Was that the best way to approach the problem? Why not? Have any ideas on what you could have done differently?” Then you’re having a conversation and talking through solutions, not pointing a finger.
Make everyone a leader. Highlight your top performers’ strengths and let them know that because of their excellence, you want them to be the example for others. You’ll set the bar high and they’ll be motivated to live up to their reputation as a leader.
Take an employee to lunch once a week. Surprise them. Don’t make an announcement that you’re establishing a new policy. Literally walk up to one of your employees, and invite them to lunch with you. It’s an easy way to remind them that you notice and appreciate their work.
Give recognition and small rewards. These two things come in many forms: Give a shout out to someone in a company meeting for what she has accomplished. Run contests or internal games and keep track of the results on a whiteboard that everyone can see. Tangible awards that don’t break the bank can work too. Try things like dinner, trophies, spa services, and plaques.
Throw company parties. Doing things as a group can go a long way. Have a company picnic. Organize birthday parties. Hold a happy hour. Don’t just wait until the holidays to do a company activity; organize events throughout the year to remind your staff that you’re all in it together.
Share the rewards—and the pain. When your company does well, celebrate. This is the best time to let everyone know that you’re thankful for their hard work. Go out of your way to show how far you will go when people help your company succeed. If there are disappointments, share those too. If you expect high performance, your team deserves to know where the company stands. Be honest and transparent.
Source: Inc.com - Ilya Pozin
4 Steps to Calculating Customer Value
Understanding customer value is by far the most important thing you can do to identify ways to grow your business. If you understand the value of your customers you can:
- Determine which customers to invest in
- Identify new customers and markets to target
- Agree which product and service lines should be offered and promoted
- Change pricing to extract more value
- Identify the unprofitable customers you should “fire”
- Understand where to cut costs and investments that are not generating growth
In fact, a robust understanding of the lifetime value of each of your customers can provide an even clearer view of the value of your business, plus the potential opportunities to increase value going forward.
Here’s how to develop a detailed understanding of the lifetime value of our customers:
Step 1: Calculate the profit contribution of each customer in the current year.
Determine revenue per customer minus any attributable costs to servicing that customer, including cost of goods, cost to service, etc. If you don’t have customer-level financials in your accounting system, do your best to roll up financials across product segments. If you are in a business with hundreds or thousands of small customers, develop a set of customer segments by rolling up product lines or estimating the buying patterns of various customer types.
Step 2: Develop a realistic estimate of how long you might retain each customer.
The relative duration of a customer relationship is more important than the absolute timeframe. Determine which customers are more loyal and which are likely to be repeat buyers and how often they buy.
Step 3: Estimate the cost to acquire or retain the customer.
Some customers may require large discounts or heavy marketing investments up front, but little or no cost to retain. Others may require a costly reselling effort every month. Estimate the cost of this on a yearly basis.
Step 4: Do the math.
Build a simple cash flow model combining yearly contribution projections, costs to acquire or retain, and continue the cash flow for the projected life of the customer relationship. Be sure to subtract an “overhead charge” for your total operating costs and include any capital costs if customers require incremental capital investment (e.g., working capital or equipment). Discount future years at a reasonable cost of capital (8-10 percent is usually a good number to use—no reason to get too technical).
Most businesses are surprised by how many customers are unprofitable when they create a “fully loaded” estimate of customer profitability. Businesses are also likely to find drastic differences in the value of various customers and segments.
This calculation of customer value may cause you to question many of your previous investments and give you a better view of where to allocate future investments.
Source: Inc.com - Karl and Bill