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March 2015

Buy a business, or launch a startup?

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- Steve Sink, CBI, M&AMI, ss@phxaffiliates.com

There are several options for owning your own business – work as an independent contract, start your own company, or buy an existing firm. There certainly are pros and cons for each of those options, but if you do a careful analysis, you’ll learn what many seasoned entrepreneurs have learned - the risk-to reward ratio is tipped in your favor when you purchase an existing business.

Experienced business owners would rather purchase an ongoing business thereby reducing the risk while creating opportunities for tremendous profit.

The benefits of buying an existing business include:

  • A proven concept - Buying an established business is less risky – as a buyer you already know the process or concept works.
  • The company’s name - The on-going benefits of any marketing or networking the prior owner has done will transfer to you.
  • Existing relationships -With the purchase of an existing business, you will also be buying an existing customer base and vendor base that took years to build.
  • An immediate focus - When you buy a business, you can start working immediately and focus on improving and growing the business without delay.
  • People/staff - One of the most valuable and important assets with the purchase of an existing company is the people. With the right team in place, just about anything is possible and you will have an easier time implementing growth strategies.
  • Cash flow - Typically, a sale is structured so you can cover the debt service, take a reasonable salary, and have some left over to take the business to the next level.

The fine print is: Finding the right business to purchase can be a daunting task. Assembling a team of experts, including a qualified business intermediary, to assist you in the process will help avoid many headaches.

Good Luck!

Steve Sink  CBI, M&AMI

ss@phxaffiliates.com

The PR of disaster recovery in Indiana

In our hyper-polarized society, it should come as absolutely no surprise that Indiana has procured itself a gigantic black eye due to the "Religious Freedom Restoration Act" that was recently passed by the legislature and signed into law by Governor Mike Pence. A media uproar has ensued and threatens to reverse all the other work the state has done in the past 25 years. Hoosier

Indiana has become a convention and tourism magnet in recent years - totally transforming their economy. This incident has captured the nation's attention, and not in a positive way. 

How does an entire industry recover from such a debacle?

My advice: A sustained public relations campaign to boost Indiana's chances from slipping into fly-over state oblivion.

How does Indiana begin this process? I'd suggest getting every stakeholder around the table and listening. Then, get a quick plan together. The very first thing that should materialize out of this plan is an all-out media blitz from the Indiana Chamber, Tourism Bureau and any celebrities they can conjure up.

This citizen army is this only thing that can counteract the thoughtless act of the Indiana legislature. I hope they don't waste time trying to repeal the law or toss people out of office. That will only serve to further polarize the state. 

If I lived in Indiana, I would be emailing, calling, texting and Facebooking all my friends. I'd invite them to welcoming places - and offer to host them. Face-to-face and heart to heart can combat the awkward actions of elected officials.

In a couple of weeks, the world will move on. But if Mike Pence's botched TV interview - where he couldn't answer simple yes-or-no questions about the implications of the law - is the last impression people have, then that would be a shame.

The lovely people of Indiana have worked hard to make it a destination for so many events. They deserve better.

Claire Celsi is a communications consultant in West Des Moines, Iowa. Visit her website, or follow her on Twitter or LinkedIn

Balance begins with taking stock

Rita Perea is President and CEO of Rita Perea Leadership Consulting Associates, specializing in working with senior leaders to successfully engage employees, lead teams, manage change and balance work and life.

Taking stock blog post photo

The coffee shop conversation started when I asked my friend to share her biggest work-life balance challenge with me. I wanted to find out what this incredibly successful executive saw as a barrier to having a healthy, happy, fulfilling personal and professional life.

After setting down her mocha latte, my friend sighed heavily, rolled her eyes and dramatically slumped forward on the coffee shop couch.  “Oh, where do I begin????”

The question about perceived barriers to work-life balance hung in the air as I waited for her to gather her thoughts. The pregnant pause lasted for a long time. She finally straightened up, squared her shoulders and set her jaw. I knew that she was getting into “warrior princess” mode and would be sharing the good stuff with me momentarily. 

My longtime friend looked me in the eye and started, “I think that I do really well to keep things moving forward at home and at work. In both worlds I find that I am continually managing people and projects to not just meet, but to exceed, expectations. It might seem a bit funny to others to think about the task of being sure that the dog gets fed every morning as part of a project, but if you take a 30,000 foot view of it, the project becomes keeping the dog healthy for a long time. That involves the action step of feeding him each day, right? And someone has to step up or be assigned to do that task. For me, chunking things, even my personal life things, out into projects with goals and an informal action plan really helps me keep it all straight and organized. So I use the same sort of project management strategies at home and at work. I feel more balanced when I can be the same person with the same dynamic style at home and at work.”

I nodded as I listened intently and told her that I completely understood. I use the project approach myself with success. I think of all of my personal and professional projects as pieces of a puzzle. The puzzle is my life in totality, both at work and outside of work.  When all of the puzzle pieces fit together well and are aligned, life works well for me.

When a piece is not fitting in, becomes too massive or out of control with too many sub-pieces to manage, life can become seriously unbalanced. Research supports this and informs us that over time an out-of-balance life can lead to exhaustion, irritability, obesity, mental fogginess and, ultimately, the medical condition of adrenal gland fatigue, for both men and women. 

My female executive friend continued, “The thing that throws me off track and makes me crazy is when I get to the tipping point with too many projects that I am managing at home, at work, and in the community. Look, I need to be visible and involved in the community for my job. That is a given and I embrace that. I sit on several community boards and volunteer my personal time to do so. It is hard when a person who is being paid as an employee of the board does not respect that as a volunteer I only have so much time and energy to give to the cause. These community commitments can be fulfilling but they can also add an additional layer of projects to manage in my life. Sometimes I need to take stock of my commitments in a very honest way and make some decisions about if I am the best person for that position on that Board or committee. When I am feeling over committed, I find that it is a good idea to do some soul searching to determine if my time is being used to the best for all concerned, including my family. I am also occasionally assessing if I am robbing someone else of a leadership opportunity that may enhance their career or be a meaningful in their life. If so, it may be time for me to graciously move out of the way.”  

My training as a work-life balance specialist supports this “taking stock” of time commitments strategy that my friend uses. I like to suggest that people begin employing this technique annually, and then incrementally move to a monthly review of both personal and professional time commitments.

Just the very act of reviewing how you are spending your time and seeing where you can add or shave some off will help you feel as though you have some breathing space.  

My friend concluded our coffee meeting by saying, “At the end of the day, I am my biggest champion or my biggest hinderance to my own work-life balance. It comes back to me.  I am the only one who can do the diligent work of making healthy choices to support this balancing act we call life everyday.  Some days I do it better than other days.  Recognizing this and being gentle with myself is also part of finding that balance.”

If you find yourself continually feeling rushed, stressed, like you have too much to do and not enough time to do it, take my friend’s advice. Honestly take stock, assess, analyze and then take action to create more work-life balance in your personal and professional life.

What an Iowa income tax might look like with a fresh start.

We've talked about why Iowa's tax law is bad for business, and about some easy fixes to make it a little better. But let's dream bigger. What would Iowa's tax law look like if you could start over from scratch?

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If Iowa's income tax were a car, it would look like this.

I would start with the Tax Foundation's Principles of Sound Tax Policy, including

Simplicity: Administrative costs are a loss to society, and complicated taxation undermines voluntary compliance by creating incentives to shelter and disguise income.
 
Neutrality: Taxes should not encourage or discourage certain economic decisions. The purpose of taxes is to raise needed revenue, not to favor or punish specific industries, activities, and products.
 
Broad Bases and Low Rates: As a corollary to the principle of neutrality, lawmakers should avoid enacting targeted deductions, credits, and exclusions. If tax preferences are kept to a minimum, substantial revenue can be raised with low tax rates. Broad-based taxes also produce relatively stable tax revenues from year to year.
 
I would add:
 
Business income should be taxed only once, unless avoiding double taxation does violence to simplicity, neutrality, and broad bases with low rates. 
 
A system designed from scratch would apply the ultimate simplification to Iowa's corporation income tax: it wouldn't have one. Iowa's corporation income tax is rated the very worst, with extreme complexity and the highest rate of any state. 
 
Eliminating the corporation income tax would eliminate the justification for almost all of the various state incentive tax credits, all of which violate the principles of neutrality and simplicity in the first place. For its astronomical rates and complexity, it generates a paltry portion of the state's revenue, typically 4-7 percent of state receipts.
 
For S corporations, a from-the-ground-up tax reform might tax Iowa resident shareholders only on the greater of distributions of S corporation income, or interest, dividends, and other investment income earned by the S corporations. The investment income provision would prevent the use of an S corporation as a tax-deferred investment. The effect would be to put S corporations on about the same footing as C corporations.
 
The Individual Income Tax couldn't be eliminated without radically restructuring both state spending and other state taxes, but it can be made much better.
 
I would start by basing the individual tax base on adjusted gross income -- taxable income before personal exemptions and itemized deductions. That would put non-itemizers on the same footing as itemizers.  I would allow only deductions for gambling losses, non-employee business expenses deductible on federal returns, and investment interest expense, to prevent grossly unfair anomalies that would otherwise result. That's it.
 
It would eliminate all other deductions and credits and put the savings into lowering rates. The Iowa 1040 would then just take federal adjusted gross income, with a few lines for deducting Treasury interest and the some other minor adjustments.
 
There would be no alternative minimum tax. There would be a generous exemption for low-income earners. If the new system keeps an earned income tax credit, the exemption would be high enough to keep taxpayers in the "phase out range" of the credit from paying income tax on top of their credit loss. If there were an earned-income credit, there would be no other credits except for taxes paid in other states and countries.
 
There would be no deduction for federal taxes. This deduction would be built into lower rates. Iowa is almost unique in allowing a deduction for federal taxes, and it makes Iowa's income tax look worse to outsiders than it really is. It is the opposite of simplification.
 
Put all of these things together, and you should be able to get Iowa's individual rate under 5% -- perhaps close to 4% -- without reducing individual tax collections.
 
0% corporate rate, sub-5% individual rate -- now that's a lot easier sell to a business pondering an Iowa location than a 12% corporation rate, 8.98% individual rate, and the occasional tax credit to ease the pain.
 
Of course, we aren't starting with a clean slate.  We have a tax system now that is encrusted with decades of breaks that seemed like a good idea at the time. People who have good deals now will fight to keep them, even if they mean other people have to pay more. But even if we can't reach the promised land of a completely clean, simple and neutral income tax, we can get to a better place if we try heading that way. And a good start is to not head in the wrong direction, by at least not enacting any more special breaks and tax credits.

How are your customers trying to reach you?

TweetDrew McLellan is the Top Dog at McLellan Marketing Group

Like much of central Iowa last week -- I was away on Spring Break. Our trip had a rocky start, to say the least. We get off the plane in Jamaica and head to the Sandals desk, assuming they're going to help us identify the bus that will take us to our selected resort so the fun can begin.

Instead, when we get to the desk we're told that they oversold our resort (the family one) and instead, we're going to be staying at the Couples Only resort.  

Now, when you're a dad who is traveling with his daughter and her boyfriend -- this is the definition of awkward.

They grab our luggage and put us on a van. Now what?

We're in a foreign country, in a moving vehicle, heading for a resort I do not want us at, I don't have the resort's phone number and I need some help sorting this mess out. And I don't really want to wait until we get to the wrong resort.

Fortunately -- the van has wifi. So I search for the Sandals twitter account and send them a couple tweets -- saying I am very unhappy about how this customer service issue is being handled.  

Voila....I get a tweet back, asking me to DM them.  (Which was smart -- demonstrate to everyone who is watching that you're listening but then move the complaint offline or to a more private venue).

Within a few tweets, the general manager has been alerted and will be waiting for me when we get off the van.

The story has a happy ending.  We're at the resort we originally booked and the weather and ocean are gorgeous... so all is well.

But, my story raises the question -- how are your customers reaching out to you and are you listening for them?  Sandals was clearly monitoring their account/Twitter and very quickly defused a problem.  

But so many organizations look at vehicles like Twitter and Facebook as a broadcast medium. They put their information out there like they're shouting through a bullhorn. But they don't bother to listen to see if anyone is talking back.

That's a dangerous practice. You need to be monitoring any social channels you're on in real time (you don't have to sit in front of your computer -- just use one of the many monitoring tools that send updates to your phone) so that when your customers use those tools to get your attention -- you're actually paying attention.

It used to be that if a customer had a question or complaint, they either sent a letter or called. Then, we added websites and suddenly they could communicate to us through contact forms or email addresses.  And now -- there's social channels.

When someone is having trouble -- they're going to use whichever tool they think will get the swiftest response from you. Which is why social is a natural choice. 

So what do you think it says to them if you're not listening.

Uncommon leadership: lessons from Lady Gaga

Dr. Christi Hegstad is a Certified Executive & Leadership Coach and the President of MAP Professional Development Inc.

Gaga book cropWhen you think of Lady Gaga, what comes to mind? Probably her musical talent (six Grammy awards so far), perhaps her outrageous wardrobe (meat dress, anyone?), maybe her unusual antics (the infamous awards show entrance in a giant egg). Only 28 years old and she has certainly made a name for herself.

But as Jackie Huba outlines in her book, Monster Loyalty: How Lady Gaga Turns Followers Into Fanatics, there’s much more to Lady Gaga than meets the eye. In fact, she proves an excellent case study in authenticity, service, and powerful leadership.

Unfamiliar with the book when I picked it up, I had few expectations. I merely hoped to get a bit of insight into why Gaga does what she does, but the introduction set my aim higher: “Lady Gaga’s business sense impresses me,” writes Huba, “but her passion for changing the world for the better through any means possible is what truly inspired me to study her.” Page after page, Huba shows how Lady Gaga takes extraordinary measures to make a difference to the causes and people that matter most to her.

A few lessons in uncommon leadership from Lady Gaga:

  • Focus on those who matter most. Have you ever heard hurtful criticism from someone you don’t even know – or maybe know and don’t respect – and let it bother you? Let it go. You’ll never please everyone, especially if you’re challenging the status quo. Focus on your mission, values, and those who matter most.
  • Start with why. Huba shows how Simon Sinek’s “golden circle” approach (start with why, then how, then what) applies to Lady Gaga’s work, and how we can bring it into our own work as well. Gaga’s why? “To transform the culture to create a kinder, braver world where everyone is valued.” Her why shines through everything she does, from her songs to her interviews to her Born This Way Foundation that empowers youth to build confidence and end bullying. 
  • Go big or go home. “No one talks about products or companies that are just average,” Huba shares. “The way Gaga sees it, whatever you are working on, you should blow it out.” Don’t let the fear of what others might say keep you from honoring your authenticity. Playing small or hiding your light serves no one.

Lady Gaga also reminds us of a key principle in leadership: it’s not about you. As it turns out, the meat dress, as well as her other attention-grabbing “stunts,” involve purposeful action: to support a cause, speak out against an injustice, or give a voice to those who might not otherwise be heard.

While you may not agree with nor want to attract the same kind of attention as Lady Gaga, her ability to connect deeply with and inspire her most engaged fans offers terrific leadership insight. “What I do [in my concerts],” she explained to MTV, “is, in essence, create an atmosphere for my fans where they don’t leave loving me, they leave loving themselves.”

Consider how you can more powerfully focus on those who matter most, start with why, and go big – all in service of a brighter, stronger world. Because remember: regardless of your title, fame, or the number of Grammys on your shelf, your leadership is not about you.

COACH’S CHALLENGE:

How can you step outside the norm in your leadership? Where could you make an inspiring splash or bring an unexpected delight to those who matter most? This month, step outside your comfort zone and take an uncommon action in service of those you lead. Share your uncommon leadership ideas in the comments!

Christi Hegstad MAP Inc HeadshotDr. Christi Hegstad coaches leaders to make a meaningful difference doing what they love. Learn more about her coaching work at www.meaning-and-purpose.com, on Facebook at www.facebook.com/MAPIncFan, and via Twitter at www.twitter.com/DrChristiCoach.

Monster Loyalty: How Lady Gaga Turns Followers Into Fanatics by Jackie Huba (Penguin, 2013)

 

You, Inc.

Joe Benesh is a senior architect with Shive-Hattery and President + CEO of the Ingenuity Company, a strategic planning, diagramming, framework development, and design thinking consulting firm.

I had lunch with a good friend of mine last week. He and I spend a lot of time talking about how the workplace is evolving and different strategies for how to respond to these evolutions.

The catalyst of this particular conversation was that my friend wanted to know when an appropriate time to pick up his dry cleaning would be – it had been at the cleaners for weeks and he just hadn’t found time.

This led us to a very interesting conversation about strategy, and how the way we all interface with our daily lives might be more closely aligned with running a successful business than the traditional view of what the idyllic view of day-to-day life truly is.

As our society has evolved, we have developed a tendency to move away from the 8-to-5 employment model in favor of a more flexible schedule centered around what is conducive to effectively completing work, but in different timeframes. Employers are becoming more and more flexible, realizing that productivity and job accountability actually goes up when employees feel like they have more control over when the hours they work occur.

But my friend and I were not simply talking about flex time at work. What we were really talking about is how he and I both look at our schedules and tasks for the week as if it were a business.

For me, scheduling tasks on Sunday is critical. I set and check personal and work appointments for the week, making sure that I am able to balance everything. Scheduling time for family is a critical piece of this – if you are a “workaholic” you know exactly what I am talking about. Paying bills, reading, catching up on email. Everything gets a look – it has to in order for there to be enough time to get to everything effectively and do it as well as possible. If I simply “wing it”, everything is generally a mess by late Tuesday morning.

The business of “You, Inc.” is open 24 hours a day, 7 days a week. The strategy on how to make You, Inc. a successful business relies heavily on balance, setting goals, and being disciplined about executing what you set out to do on a day-to-day, week-to-week basis. This will aggregate into systematic and sustainable success.

Let’s get back to my friends dry cleaning conundrum. I think the answer is that “it depends.”

Each person should take time to define what is appropriate for their own case and what will allow them to be effective with their jobs and their daily lives. What I have found is that many “alpha”-type people have a tendency to put off things like picking up dry cleaning, getting haircuts, and getting their cars in for service because they “can’t find time” to do these things.

But think about it this way – if these things were part of your job, would you find time to do them? Of course you would.

Running a successful business has a lot to do with using holistic strategies. For me and for my friend, this means that sometimes we have to get our dry cleaning at 3 p.m. on a Wednesday, because we happened to be in that part of town and it would be hard to get it otherwise.

Sometimes it means we have to finish a proposal at 4:30 a.m. on a Sunday because that’s when we feel most productive. It’s prioritizing personal tasks along with professional ones that lead to better overall success.

The business of You, Inc. is ongoing and always in development. By thinking about things holistically, you can ultimately improve the ability to be successful in all that you do by incorporating a little bit of strategy.

Five key insights from the first internal innovators meetup

Max Farrell is the co-founder of Create Reason, an innovation experience firm that promotes a culture of intrapreneurship inside established companies.

Recently a group of intrapreneurs/change agents from a handful of area companies got together for the first Des Moines Internal Innovators Meetup. We discussed a number of topics around how companies approach innovation, what some of the wins have been, what roadblocks have been and an open dialogue on supporting one another.

It was a great chance to connect like-minded professionals and we’re excited for what the future holds with this group. Following the group, I identified five key insights from the discussions and share them with you here: 

Everybody has problems

We all know of internal politics, mixed ambitions, communication breakdowns, etc. But we all have problems and address them in different ways. Establishing this was a huge breakthrough for us in having authentic conversation. 

Companies have different definitions of “innovation”

To some people, innovation means disruptive or big changes. For others, innovation is about making continuous improvements and incremental progress.  Different groups believe it’s a cultural shift and a “new way of thinking” for the employees. 

Not only is this an occurrence across different companies but this happens within organizations. Multiple people have multiple interpretations. This is where the group agreed it’s key to have a clear definition of what innovation means to the company. 

Companies have the power of the brand as an unfair advantage

If customers already align with your brand, selling to customers or prospects is half the battle. This makes it much easier than startups attempting to establish a brand from the ground up. 

One exception to this exists when established companies are expanding internationally. The brand doesn’t have the same weight in new markets and may be interpreted in unexpected ways. This can lead to a tougher time acquiring brand loyalty in new markets, but provides an opportunity for companies to better understand their expansion areas. 

“What worked yesterday won’t work tomorrow”

Not only do markets change rapidly, but the definition of success does too. Teams internally sometimes have a hard time realizing “what worked yesterday won’t work tomorrow” and have to work to acquire buy-in for new approaches to implement instead of being heads down on figuring out what work tomorrow. Ensuring companies move quicker on this front is crucial to success.

Innovation goals have to align with business goals

Unless an innovation team is autonomous from the rest of the business, innovation goals have to meet the pre-set demands of a business. This means innovation can be used as a tool to more effectively meet or exceed existing goals. Some groups work to understand the strategic initiatives and then filter possible new initiatives based on those.  

Closing

This was a great first meeting and we’re looking forward to more discussions with local intrapreneurs. If anyone in your company is interested, please have them fill out this form to join us at the next meetup!

Let's keep the conversation going: 

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Email: max@createreason.com

Twitter: @MaxOnTheTrack / @CreateReason

Web: CreateReason.com

FB: facebook.com/createreason

Create. Destroy. Repeat.

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Dr. Anthony Paustian is the provost for Des Moines Area Community College in West Des Moines and the author of "Imagine" and "Beware the Purple People Eaters."

I recently watched the movie The World’s Fastest Indian. It was a true story of New Zealander Burt Munro, played by Anthony Hopkins, who took a 1920 Indian Scout motorcycle and highly modified it through ingenious methods, often using very unconventional and homemade tools. After defying the odds and a number of limitations, he found himself at the Bonneville Salt Flats in Utah in 1967 at the age of 68, breaking the world record for the world’s fastest motorcycle under 1000cc. It’s a record which still stands today.

In the movie, Burt was asked why he went through all of the trouble to do this at such an old age. His response: “The reward comes from the doing of it.” That statement immediately got me thinking about a period in my childhood that has, in many ways, become the benchmark of how I approach most everything in life today. 

When I was eight years old, my parents bought a new home in a new housing development surrounded by active construction. Being an enterprising young man, I went to each of the construction sites and received “after hours” permission to remove the scrap wood that was piled on the ground, as well as the nails that were dropped on the dirt. I believe most of the carpenters saw this as a way to rid the site of excess “trash,” since houses at that time weren't built as efficiently as they are today.

Having watched and learned from the various carpenters constructing the houses, I designed and built all styles of forts including ranches, split-levels, ones with two- and three-stories, ‘A’ frames––some in trees and others on the ground. Each time I built one, I would briefly admire it, think about how I could improve it, and then destroy it so I could begin constructing something bigger and better. My mother found this behavior unnatural and frequently proclaimed, “You build these beautiful forts, but you never play in them. I don’t understand you!”

Prior to high school I was by no means a good student, and I could be somewhat challenging at times for my parents, teachers, neighbors, and just about every other adult figure. Despite this, most thought me to be “creative,” but they never really understood what that meant or how to help me harness it in such a way so as to succeed in school. Without realizing it, they were doing just that each and every day by supporting me in my many endeavors, not the least of which was fort building.

In a results-oriented world, the final product or outcome typically gets the majority of attention and praise. What usually goes unnoticed is the “process” that goes into getting there, which is the primary aspect of creative thinking. Creative people are all about the process, and truly “the reward comes from the doing of it.”

Thomas Edison, thought to be an addle-brained youth and most noted for inventing the functional light bulb, had to experiment with thousands of possible filaments before he found one that worked––a daunting task. That success wasn't enough, however. He went on to help design and create a method to distribute the electricity needed to power the bulbs in the first place. He designed the first commercially available fluoroscope (a machine that used X-rays to take radiographs), the motion picture camera, the phonograph, and many more devices that led to him holding 1,093 patents in the U.S. alone. For Edison, it was about the process of improving.

Apple Computer had the best computer available in the late 1970s, the Apple II. However, Steve Jobs wasn’t content and pushed Apple forward with the development of the Lisa, and ultimately the Macintosh, before his release as CEO for having been too aggressive on these developments. After his return in 1998, he continued on with his process approach that led to the development of the color iMac, iPod, iPhone, MacAir, iPad, and a variety of innovations in between.

For creative people, it’s seldom about the destination. Although the outcomes along the way can frequently lead to wealth and success, the stories of these and a great many other creative people always have one thing in common––the key to their success was the drive and passion related to the process, not necessarily the end result.

Practice Challenge:  What do you enjoy doing? What about that activity brings you joy? I believe that for most of us, it’s the actual act of doing it––the process. Determine what is most important to you and then do more of it. Edison invented because he loved inventing. Jobs pushed the envelope on design and function because that was his passion. Life is short. Spending your limited time engaged in an enjoyable process can be a huge source of happiness in your life.

©2014  Anthony D. Paustian

PaustianLargeHeadFor more information about Dr. Anthony Paustian, provost for Des Moines Area Community College in West Des Moines, please visit his website at www.adpaustian.com

 

 

How bright is the sunshine in your community?

This week is “Sunshine Week,” which celebrates access to public information and promotes understanding of the importance of open access in making democracy work.

After working several years in the local government arena in central Iowa, we've learned there are differences in the culture of transparency among the various local governments. As a “taxpayers” organization it is interesting to experience the differences in interpretation of what that term means, and how it influences our relationships and access. 

We’re mostly concerned with fiscal information – how money is collected and spent, and the value obtained. As a rule, local governments want the public to be aware of how well they’re managing the taxpayers’ funds. Today, the larger public entities have professional chief financial officers (CFO’s) who welcome the interest that is shown. They produce “Comprehensive Annual Financial Reports” (CAFR’s) which are prepared according to strict governmental accounting standards, then audited. Such consistency in reporting has gone a long way to splash sunshine on government finances. Any citizen can look at a CAFR and know they are getting information that is consistent, true and meaningful, at least according to generally accepted accounting standards.

Perhaps the differences are demonstrated more in the extent to which the local public entities go the extra mile to share and explain information. Here, the truly proactive entities separate themselves from the pack by embracing transparency – inviting us right into their processes.

For example, Broadlawns Hospital, the fifth largest property tax-supported entity in central Iowa, presses us to regularly attend and participate in its monthly Finance Committee meetings. We receive the same information as do board members, and we’re welcome to access any other information that may be needed or desired. Similarly, the Des Moines Independent Community School District (largest taxpayer supported entity) convenes a citizens budget advisory committee, on which we are invited to serve, each year during the budget development process.

CFO Thomas Harper provides access to subject matter experts and will help explore any topic in which the group has interest. These sessions are extra work for the district but the trust and shared understanding that is developed pays dividends for all parties. We have a better understanding of district finances; they have people who can support them when tough decisions need to be made.

Today there is more visibility than ever before to agendas and supporting documents for local board and council meetings. Most of the larger local governments (and some of the smaller ones) post this information online, making it easy for anyone to see the details of what is happening in their community or school district. But it is not universal yet even among the largest entities, for example the Polk County Board of Supervisors posts agendas and brief minutes, but none of the supporting documents.

One of the more mundane but critical aspects of transparency has to do with the ease of contacting people (who in turn, of course, have information). It’s frustrating when you need to call or e-mail someone, but can’t access a directory with individual phone numbers and e-mail addresses.

This is simple, but it might be the most fundamental piece of transparency: can you get to the real person who you believe is accountable for your issue?

Even in 2015 we still have local governments that try to control access to elected officials.

For example, the Dallas Center-Grimes Community Schools is running a bond special election on April 7, yet school board members cannot be contacted directly – they must go through a district-controlled filter. It’s hard to imagine why any elected official would wish to be so insulated from constituents, or why a superintendent would wish to keep them so insulated.

One easy way to celebrate Sunshine Week is to check your local government websites and see if you can find a directory with real people (both key staff and elected officials) and their contact information.

Or see if you can find the agenda and all materials from the next or the last council or board meeting. If you can, then call your board or council member to introduce yourself and say “thanks.”

If you can’t, ask for it.

A higher standard

Businessman_superhero

Should we, as much public opinion suggests, hold corporate executives, politicians, professional athletes, and so on, to a higher standard because of their high profile, possible role model status?

Then the rest of us could conveniently rationalize personal use of company time and supplies, lying on our taxes, not following through on promises and commitments and telling lies to cover-up our mistakes, all because of our coveted “lower standard status”. 

Sound absurd? 

According to John C. Maxwell, author of There’s No Such Thing As Business Ethics, 84 percent of college students believe the United States is experiencing a business crisis, and 77 percent believe CEOs should be held responsible for it. Interestingly, 59 percent of those same students admit to having cheated on a test.   

In the workplace, 43 percent of people admit to having engaged in at least one unethical act in the last year and 75 percent have observed such an act and done nothing about it. 

People say they want honesty and integrity from their leaders. Ironically, their behaviors tell a very different story. The same person who steals office supplies, lies to a customer to make a sale, discloses company trade secrets, or looks the other way at the ethical breaches of others, demands honesty and integrity from his or her leader. 

Hmm. 

Make the most out of your next conference

Katie Stocking is the founder and President at Happy Medium LLC.

I’m heading to SXSW, which is held in Austin from March 13-22, for my annual interactive inspiration for work. Hopefully you are also lucky enough to be able to attend a conference or two this year to help you expand your knowledge in your industry. Conferences are not only educational but also inspiring. Since the season is upon us, here are my tips for making the most of them! 

Make a game plan: It’s always a great idea to plan ahead, especially when you (or your company) is investing in you.

Networking: Part of your game plan should include how you plan to network. Make sure you take enough business cards; you’ll be passing them out like crazy! Depending on your situation, it might also make sense to bring some company swag to really stand out from the crowd. 

Recap each day: Whether you’re attending the event with other team members or on your own, take a few minutes at the end of each day to digest things you heard and learned. Organize your notes while they are fresh in your mind.

Take notes: Take your laptop or your favorite notebook and pen to make sure you get to take note of all the great ideas you’re hearing. Also, when entering a room, check to see if the speaker has provided any print outs of the presentation so you have a base to work from.

Live in the moment: While taking notes is important, it is also equally important to make sure you’re not too busy jotting down every word you hear, to really absorb the overall concepts and say hi to the people next to you. If you don’t make it to the specific talk you wanted to, jump into the nearest room; you never know what great information you might hear!

Go home with a plan: For me this is probably the most important tip. It’s really very easy to get back from being out of the office, into the E-mail soup you have to clean out and forget to implement anything you learned! Go home with an exact list of what you want to implement right away and also a list of things you want to implement in the future. Write down your exact plan, and it is much more likely to happen.

Enjoy your travels! Follow me this week while I’m at SXSW. I’ll be tweeting and Instagramming things I learn. @klstocking

It's not the response, It's the follow-through

San-antonio-robberySometimes the quality of customer service is revealed by the little things we repeatedly do. Back in January I wrote a blog post here at IowaBiz. I bemoaned the fact that years of being a regular guest at two specific hotel locations had not resulted in being greeted as a regular guest. Instead, I was always asked the "Have you ever stayed with us before?" question which seemed insulting after about the 50th stay.

Shortly after writing that blog post I visited one of the two locations I cited, the @Courtyardhotels by @Marriott on Broadway in San Antonio, TX. To my surprise, the young man who checked me in (as he had multiple times before) welcomed me with a "welcome back!" As a customer service consultant and specialist who had just written a post about this small customer service detail, I was surprised, impressed and optimistic about this positive turn of events.

Sometimes, however, the quality of customer service is revealed by those exceptional situations when things go horribly wrong. That very night, my hotel room was robbed.

I was staying in an interior courtyard room on the first floor. While I was away at dinner a thief or thieves broke the plate glass patio door, absconded with electronics gear and training materials worth in the neighborhood of $5,000 and escaped without ever being seen on the hotel's security cameras. Both my personal and work computers were taken along with iPad, training gear, and an external hard drive with my entire personal photo library. In over 20 years of business travel and consulting, I have never experienced anything like this. It was a customer service nightmare.

So, how did the staff of the Courtyard Inn do?

Initially, this horrific violation was handled as well as I could have ever expected. When realizing that the break-in had occurred, the staff called the police and notified the assistant General Manager on duty who handled things with empathy and professionalism. I was moved to the nicest room they had available and told that they would take care of anything I needed. They even offered to get me anything I wanted to drink or something to eat. My tweet about the experience received immediate response from the corporate social media team. I was treated with deference and the staff went out of their way to take good care of me that night.

Because of the loss, I had to scuttle my customer service training with the client that week I returned home to file my claims and reschedule things with my client. At that point, I felt pretty good about Marriott's handling of the catastrophe.

When I rescheduled my training visit just two weeks later, I considered staying at a different hotel. Most of my friends and colleagues encouraged me to do so. I decided, however, to reward the folks at the Courtyard Inn with some loyalty. I was also curious to see how they would follow through. I phoned the assistant general manager days before my trip to let him know I was coming and that I would like to meet with him to be updated on the investigation of the break in. I received no response.

When checking in mid-day, I was not remembered or recognized. I asked for the assistant general manager by name and was told "he's no longer here," giving me the impression that he'd left or been let go. I explained what had happened two weeks earlier and said I'd like to talk to someone to check in on the investigation and to see if they'd learned anything about what happened. I was told that the general manager was on-site and would contact me. I heard nothing all afternoon.

I checked at the desk late that afternoon with one of the clerks who had been so kind and empathetic to me just a few weeks earlier. She obviously didn't remember me. I reminded her of the experience and she seemed to remember me...maybe. I asked why I'd not been contacted by the general manager as promised. I was told that he/she had left for the day but the clerk said she would send an e-mail right away. I was assured that the general manager would get the e-mail and I could expect to receive a prompt response. I heard nothing.

I checked out two days later without ever receiving so much as a message from the general manager. Later the day after checking out I finally received a quick voice-mail from the assistant general manager (I guess he was still employed there) who said he was returning my contact. I was already hundreds of miles away and checked into another hotel. I was not impressed.

I returned from my trip to find that my Marriott credit card had been charged for my room the night of the break in and for the coffee I'd gotten at the hotel Bistro the following morning. It seems the hotel's promise to take care of "anything I needed" was only limited to a snack or beverages the hour or two immediately after the robbery was discovered. I must assume that they felt adequately generous putting me in the empty one-room suite they had available at the price of my robbed king-suite. 

One of the things I have always taught my clients is that customers tend to remember the last impression you give them. The Courtyard Inn in San Antonio, and the folks on the corporate social media team initially impressed me with their empathy and responsiveness. In fact, it earned my loyalty and a return stay. It is the lack of follow-through and the last impression that sticks with me, however. Broken promises, lack of communication, and getting stiffed for a room that was robbed.

 What kind of last impression is your team making?

Start collecting those reviews on Google

By in large, people buy from people they trust. And when they are in need for a product or service they are unfamiliar with, they generally ask friends and family for recommendations. This is because trust can be transferred from person to person in what is known as Social Proof. This psychological phenomenon allows people to make decisions by trusting experiences others have with an otherwise foreign situation: “Hey Bob, my tooth is killing me, you know a good dentist?”

5starThat is why referrals are so darn effective. People don’t need to take the time and effort to build their own opinion of a specific business - they figure their friend has done that already. But if Bob, or anyone else for that matter, doesn’t know a good dentist? Well, in this instance over 67 percent of people are headed right to Google and finding out who other people recommend (1 percent are even using the I’m Feeling Lucky button).

People are essentially looking for Social Proof outside their direct network. Just last year Google released an update to their search engine algorithm known as “Pigeon”. This update greatly impacted local search results; effectively giving an edge to businesses targeting nearby prospects. Great news for businesses that are on top of collecting online reviews! People are hungry for unbiased feedback, and Google reviews are perhaps the next best thing to direct word of mouth.

The effectiveness of Social Proof on a prospect is impacted by:

  1. The perceived familiarity with the products or services by the reviewer

  2. How accurate and unbiased the review appears to be

Google is pretty good about maintaining their reputation for unbiased reviews. In fact, they go to great lengths to keeping their reviews free from outside influence. Because of this they are trusted by prospects as a way to evaluate a company. But there are ways you could go about collecting more for your business - and I encourage you to be active in doing so.

Although directly soliciting for reviews is not encouraged by Google, they say it’s okay to ask your clients for them. Below is a response from one of Google’s forums discussing this topic:

“It’s fine if you reach out to customers to ask them to review, but I do not recommend that you do this in waves. If you want to reach out to legit customers and ask them to review, I recommend you contact them immediately after you have done business with them.”

When going about collecting reviews from your customers it is best to follow a process, and spread it out over time. Collecting too many reviews at one time could lead Google to delete them all together. A consistent approach is important, and I have outlined some steps which is a great place to get started.

  1. Make sure you have a business Google+ page

  2. Identify who your happiest and most vocal customers are (NPS)

  3. Gather as many testimonials that you can

  4. Ask your most vocal promoters to review you on Google

  5. Do not get busted for soliciting for reviews - spread them out!

- Carl Maerz, Founder and COO - Rocket Referrals LLC

Radiant floors are on the rise


When I designed the Central Iowa Shelter & Services I knew a radiant floor would be preferred. Why?  Bare concrete floors sitting on the earth never get warm, and the shelter would be full of people who wanted to get out of the cold not into it! Since the earth’s temperature is about 55 degrees it is difficult to ever get a slab as warm as the air in the space.  Sooner or later you are going to get cold.

Commercial buildings have long used radiant floors because of concrete and steel construction. I would love radiant floors in my home but homes are not built like commercial buildings. Leave it up to American ingenuity to create Warmboard! You can now buy a 4x8 plywood panel already routed out to accept the radiant tubes.

The radiant heating panels have many advantages over the typical furnace.

  1. Everyone will feel more comfortable. Radiant heat does not require blowing air at people which makes you feel colder.
  2. Energy is saved because you can push water through pipes much easier than push air through ducts.
  3. An expensive furnace system can have two zones but a radiant system is unlimited. This allows the bedroom wing to be at a different setting than the living room.
  4. Radiant energy means you sense the heat when you are closest to the source.  Therefore the air does not tend to stratify and be hottest at the ceiling.

Let me know if you have experienced radiant floors and what you think. Contact me at rsmith@smithmetzger.com

Keep your business top of mind - in your customer's email inbox

Most of us had our very first interaction on the social web via email. Email as a technology may seem very simplistic and far flung from what most of us consider social media. Truth is - email is the mothership of all social media - always has been. Email symbol

There is still no other communication device that can transmit as much information in a way that still gets sufficient, consistent attention by consumers. We'd all drown in the sea of information that engulfs us each day if we had no ability to filter this information by importance. Since we all need email to function in the working world, email became our default "must have" social media. We cannot ignore email for any significant amount of time if we are to be taken seriously in our professional lives.

That is precisely why email is still the best marketing tool out there. Here is a recipe for cultivating your best marketing asset - the "opted in" email list.

  1. First and foremost - you must offer something worth having. Don't just send a random email. Think about what your audience needs. This is NOT about promoting yourself for the sake of promoting yourself.
  2. Convert contacts into subscribers. When you receive the name of a contact, send them an email to confirm that they want to receive information from your company. If they decline or unsubscribe, make sure that you honor that request.
  3. Use name and email address as the price for the payoff. When giving something away, require that people provide their name and email address. This is called a value exchange.
  4. Host a giveaway or contest and use email as the sign-up method. The person will have to "opt-in" to get a chance to win. They can always opt out later.
  5. Use software to help you manage your list. There are a ton of email vendors out there, each with a level of email management sophistication. Ranging anywhere from free to several thousand dollars per month, the need to pay more for help will correspond to the number of subscribers you have.
  6. Don't be boring. Very few people will open an email with a lame subject line like "March 2015 newsletter." Instead, try something that sounds much more personal - use their first name if possible in the greeting.
  7. Use your blog, website and social channels as email collection opportunities. Provide current subscribers an easy way to share your content and remind them to tweet or forward your content.

Once you have a clean email list, set some goals. Do you want to increase likes on your Facebook page? Increase sales? Recruit employees? Improve customer service? Once you've identified a goal, then tailor your email messages around reaching that goal. Without a goal, you're just wasting the marketing capital you've worked so hard to build.

Claire Celsi is a marketing communications consultant. Visit her website to learn more about her business, or connect with her on LinkedIn or Twitter.

"No News" Isn't good news

It was exactly this time last year that I wrote about employee reviews. In fact, my exact words were, "No matter how small your specialty retail business may be, there's absolutely no substitute for timely, thorough performance reviews."

I'm proud to practice what I preach. So, guess what? It's time for employee reviews again at the Heart of Iowa Market Place.

The point to emphasize this year is this: Employees want feedback. They need feedback. And, they deserve feedback.

Reviews are not just a time to talk about what a person has done wrong, of course. They're also the time to praise instances of hard work, outstanding customer service, highlights from the year and good, smart habits. They're also the time to reinforce your vision for the company, talking about where the business is going in the year ahead and where each employee fits it.

They want it because it takes the suspense and mystery out of work. They need concise, constructive feedback because it lets them know in no uncertain terms what they're doing well and where they can (or must) improve. And, they deserve it because feedback shows them they are valued, respected team members.

That favorite old axiom "no news is good news" does not hold true for your employees. If they don't hear from you, they may think you don't care or -- even worse -- that you don't appreciate their efforts or understand the struggles they face on a daily basis.

If you haven't been performing timely, thorough performance reviews, now is a great time to start. Your employees will appreciate the news -- good and bad -- to help them do an even better job going forward.

- Kelly Sharp, Owner at Heart of Iowa Market Place 

Survey: how attorneys handle valuation in buy-sell agreements

When a buy-sell agreement calls for an appraisal to be performed, the vast majority (82 percent) of attorneys surveyed say a certified/credentialed business appraiser should do the valuation. The rest (18 percent) say the public accounting firm that regularly works with the company should do the valuation.

This is revealed in a survey of attorneys conducted by the DHG Forensics and Valuation Services group at Dixon Hughes Goodman LLP. Brian Burns and Chris Mitchell.

Good news: Attorneys were also asked about the preferable methods to determine the purchase price that is incorporated into a buy-sell agreement. The most prevalent method is to have a business valuation professional perform the valuation upon a triggering event (cited by 43 percent of respondents). That’s “good news,” say Burns and Mitchell. About a third (39 percent) of respondents use a formulaic method contained in the agreement. The rest (17 percent) use a predetermined fixed price that periodically reviewed and adjusted by owners without the use of an external advisor.

When the buy-sell agreement calls for a formulaically determined value, the following methods are used:

  • A fixed multiple of average EBITDA or net earnings over the prior three years (or some other period) (43 percent);
  • A fixed multiple of, or an adjustment to, the book value of the company used for accounting purposes (9 percent);
  • A fixed multiple of prior-year EBITDA or net earnings (4 percent);
  • An average of one or more of the above methods (17 percent);
  • A fixed multiple of annual sales (0 percent); and
  • Other formulaic method (26 percent).

Source:  Business Valuation Resources

Steve Sink CBI, M&AMI

ss@phxaffilaites.com

 

Healthcare and wellness trends of 2015

Bill Leaver, CEO, UnityPoint Health

In Back to the Future Part II, Marty McFly (Michael J. Fox) travels to 2015: a world that includes hoverboards, drone dog-walkers, and flying vehicles. Now that the year 2015 has actually arrived, some of that seems laughable, but twenty-five years ago, the future was a far-off place ruled by innovation.

Today, in our technology-oriented world, this proves to be true, especially in the healthcare sphere. We may not have hoverboards, but we have Google Glass eyewear, mobile applications that organize our lives with the push of a button, watches that function as phones, and a myriad assortment of healthcare wearables to track our sleep and our steps.

What other healthcare and wellness trends can you expect to see in 2015? You will see some of the items below:

  • Focus on personalized, D.I.Y. healthcare for consumers through mobile and digital tools, including wearable technology.
  • Integration of big data through networks of cloud services.
  • Dedication to innovation and partnerships.
  • Concern about the balance of security, privacy and convenience, as more information is shared between manufacturers, regulatory agencies and medical device manufacturers.
  • Quick, intense workouts and fitness plans offered online or in the workplace, such as high-intensity interval training and yoga.
  • Expanded role of nurses, physician assistants and pharmacists within the healthcare sphere.
  • Opportunity to redefine health and well-being for millennials, as more baby boomers retire.
  • Commitment to sustainability and providing more care with less dollars.
  • Emphasis on mindful eating, real foods and a balanced lifestyle.
  • Increased number of insured individuals.

These are just a few I've noticed, and as the year continues, I think you’ll discover that health and wellness will continue to be a growing and important focus for any business. And when we think about what’s to come over the next quarter of a century, we can anticipate even more changes and opportunities related to innovation and technology, in order to improve our work, our homes and our lives.

Now - I wonder what Marty McFly envisions for 2025?

The idea prison

IdeaI was sitting in a marketing class the other night listening to the professor go on and on about innovation and creativity.  It’s a pretty popular topic in most of these classes and, while interesting, it can get a little old to hear about “the next big idea” or the “innovation cycle” for the hundredth time. Then, just as I was about to pull up my ESPN app so I could watch the Cyclone basketball game, he said something that caught my attention and kept it the rest of the night. 

He was sharing a story about the loss of innovation, about those ideas that never see the light of day, the ideas that get hidden, lost, or simply die.

“One of the biggest threats to innovation,” he explained, “is the average person’s fear to share his or her ideas.”  

The lecture continued with the professor introducing the concept of the idea prison. The average person may have a great, world changing, idea but fear keeps those ideas locked inside their head.  We don’t want to share our thoughts because we don’t want our ideas to be critiqued, to be judged, or to be torn apart. Instead of facing criticism we keep them locked up, safe and secure, inside our mind. 

This is why having a network of trusted friends, colleagues, and mentors is an important part to the innovation cycle.  We need that trusted circle so we can share ideas, get outside perspective, and help make our ideas better. Networking is a crucial part of innovation because no idea has ever been good enough to stand on its own. Every major innovation or creative moment takes a team of individuals to analyze, change, and see it through to completion.

The world is a different place than it was yesterday because of people taking the leap and sharing their ideas. Imagine what this world would look like if Henry Ford had kept the idea of the assembly line to himself or if Steve Jobs had decided that the iPhone was just another dumb idea. Don’t keep your ideas in prison. Find a trusted friend to share your thoughts, your dreams, and your world changing ideas with.  Take the criticism and help to make those ideas better.  Who knows, you may have the next ground breaking idea locked in your head right now.  Let it out!

B&W HeadshotDanny Beyer is the Director of Sales and Marketing for Kabel Business Services and author of The Ties that Bind:  Networking with Style. He is also a professional speaker on networking.

The Pygmalion Effect

SculptureWhy does someone who has been transformed through training and on-the-job experiences provided by an organization, choose to leave that organization?  

What can leaders do to help ensure that the individuals they invest in will stay with the organization?  Consider this enchanting and timeless story.

The stakes: The training program expenses.

The characters: Professor Henry Higgins, Colonel Pickering and Eliza Doolittle.

The wager:  A language expert, Professor Henry Higgins, bets Colonel Pickering that he can take a lowly flower girl from the streets of London and pass her off as an elegant young lady of society after an intensive six-month training program.

The tale:  George Bernard Shaw wrote the classic play, Pygmalion, which was the basis for the hit musical, My Fair Lady and the films, Pygmalion and My Fair Lady.

The Pygmalion Effect:  Pygmalion was a sculptor. According to Greek mythology, he fashioned a statue of a beautiful woman. Pygmalion prayed to the gods that the statue be transformed into a real woman. His wish was granted. From this mythical story came what is commonly known as the Pygmalion Effect which states: People can be shaped by others according to how they are treated.

The training program:  Professor Higgins teaches Eliza Doolittle etiquette and protocol, shows her how to make an entrance, dresses her as a fine lady and transforms her cockney accent into cultured English sentences.

The outcome:  Eliza Doolittle, following her extensive training, at a party held at Buckingham Palace, is assumed by all in attendance to be of royal heritage and is the talk of the event. Professor Higgins wins the bet.

The rest of the story:  Although Professor Higgins succeeded in transforming the flower girl, he went right on treating her like a street urchin. Eliza, speaking to Colonel Pickering, said “You know I will always be a flower girl to Professor Higgins because he always treats me as a flower girl. But I will always be a lady to you, because you always treat me like a lady.” 

Eliza’s remarkable insight is something for all leaders to ponder. In our varied roles as leaders, parents, coaches, teachers, mentors and friends, most of us are aware of the power of the Pygmalion Effect and realize that people do indeed respond to how they are treated. To this end, we champion and provide growth opportunities for others. What we frequently forget, however, is that it is also important for us to respond to the growth individuals make and encourage others to do the same. 

If we remind ourselves to change our treatment of others to match the changes they have made, then perhaps, employees will not feel the need to take their new skills to a new environment that is unencumbered by old expectations. Perhaps, they will keep their skills and talents in the place that they grew them. And perhaps, the investments leaders make in employee development will result in even greater returns.

Dismantling the distractions in your work day

Rita Perea is President and CEO of Rita Perea Leadership Consulting Associates, specializing in working with senior leaders to successfully engage employees, lead teams, manage change and balance work and life.

Has this ever happened to you...you get to the end of your work day and wonder if you've achieved anything? Where did the time go?  Maybe you start to think about the projects you didn’t get accomplished and ask yourself why?

Life hacker photo- labeled for reuseChances are that you are being distracted at work. 

It happens to us all in small ways: the bell on your personal cell phone signaling a text message; the little banner which flashes across your computer screen to announce the arrival of a new email; the co-worker who stops by your office to commiserate at length about his inability to work on the new project because he doesn't have enough time.

Taken separately these are all just tiny incidents. We can handle one item and then get back to the task at hand. Together, however, they become a raging river of distractions which take us careening off course and leave us feeling depleted and exhausted. An overload of continuous distractions can cause us to become low performers, which can potentially impact our job negatively.

Let’s look at the story of Sally (of course, not her real name). Sally was an exceptional supervisor managing an award-winning marketing team. She had an open door policy with her team members and would invite anyone to discuss anything with her at anytime.   Sally’s office was like a revolving door- people coming in and going out all day long. 

During the holidays Sally’s children got their own cell phones. Everyday after school the kids would send oodles of text messages to her seeking her attention as a referee in their disputes. Sally began to avoid marketing calls with clients during that “magical” after school time to be available if the children sent a text. This cut Sally’s productivity down substantially. She started to work later and later, which eroded what little work-life balance she had. 

To make matters worse, Sally’s husband also got a new iPhone 6 and began sending emails and text messages to her throughout the day about meaningless dribble such as, “Let’s remember to pick up cat food on Saturday!” The dings, the dongs, the bells and the whistles were distracting not only to Sally but to her team as well. Sally’s unfinished projects were stacking up and she was at the breaking point. Her distractions were insidious. She did not really know why she was being so unproductive, only that she was not the high-performer she once was. 

Fearing that she was going to receive a terrible performance review, Sally wisely sought some advice for this complicated problem. 

Sally’s mentor suggested that she begin to take control of the situation by completing a daily time log. Sally agreed to document which project she was working on every 30 minutes. If she was interrupted, she would log it by noting who interrupted her and what the interruption was about.

Sally kept track of her time and was shocked after reviewing just the first three days. She clearly saw some patterns that needed to be changed. She knew that she had to take action to dismantle her daily distractions and to get her work life back on track again. 

Sally focused on changing several behaviors that made all of the difference in the world: 

  1. Start the day with uninterrupted time.  Sally arrived at work, went into her office, closed the door and started her day by working on one high-priority project for 30 minutes. She did not check her email. She did not check voice messages. Instead she immediately dug into her most pressing project. After 30 minutes of uninterrupted and focused time, she opened her door and emerged, feeling as though she had already accomplished something important for the day.
  2. Build time into the schedule to check and respond to email, voice and text messages. Sally decided that she would check her devices and respond only during three windows of time each day: After her uninterrupted 30 minutes of morning work time; after lunch; and for an hour before she left the office for the day. She also instructed her family to not send text messages or call her during the work day unless it was an emergency. Sally had to remind herself over and over again that she did not have to quickly react to each message she was receiving. She felt comfortable responding within 24 hours. She gave herself permission to take her time and to be purposeful about her responses to other people’s inquiries.
  3. Scheduling team time and one-on-one time with her employees. Sally subtly changed her open door policy to the proactive model of scheduling time each week to speak with people. Of course, Sally will help with problem solving in emergency situations, but if she thinks that a problem can wait she will ask the employee to put it on their “Meeting with Sally” list.
  4. Use Friday afternoons for unfinished business and planning the week ahead.   Sally deliberately schedules time in the office and at her desk on Fridays to finish those projects which can be wrapped up before the weekend. She also finds it useful to review upcoming projects for the week ahead. When Sally leaves the office on Fridays, she knows that she can enjoy her time with her family during the weekend because she left things in a good place at work.  

We all need to be ever-vigilant in minimizing our own work distractions and interruptions to maximize the balance between our personal and our professional lives.

Baby steps towards fixing Iowa's business tax climate

Everyone talks about Iowa's bad business tax climate, but nobody ever does anything about it. What should a would-be climate-changer do?

Iabiz20140225As we discussed here last month, Iowa consistently has a poor rating for its business tax climate because of its tax complexity and high rates. High rates and complexity are twins. When rates get high, the well-connected lobby for tax breaks, each of which make things more complicated. When there are lots of tax breaks, the rates have to go higher to raise more revenue. The standard approach to tax reform is to do the opposite --  lower the rates, and pay for it by eliminating tax breaks.

Tax reform is hard, but you don't have to do it all at once. A few baby steps, and the grown-up steps can come later.

Some first steps that would make life easier for Iowans without affecting tax policy or state revenues:

Eliminate the alternative minimum tax for individuals and corporations. One of the reasons reason the Tax Foundation's annual Business Tax Climate Index gives Iowa low marks is because every taxpayer is required to compute both a "regular" tax and the AMT, paying the one that produces the higher tax. But Iowa's AMT applies to very few taxpayers. It is rare to see it in tax practice unless you have clients who are public-company executives with incentive stock options. The Iowa Department of Revenue doesn't even track AMT receipts -- which fuels my suspicion that AMT revenues in Iowa amount to a rounding error in the state budget. Eliminating the AMT would simplify a lot while costing the state little.

Make Iowa's tax system automatically adopt federal changes, unless the legislature votes a specific exception. Iowa every year passes a "code conformity" law to mirror federal changes in the computation of taxable income. Because large parts of the federal tax law are enacted only a year at a time, often in December, tax season is well under way before Iowans have an official tax law. It would be much easier if federal changes were automatically adopted. If Iowa wanted to exclude an area of the law from automatic changes -- like it does with depreciation -- that would be easy enough to do as part of a "floating conformity" approach. Much simplification, little or no revenue loss.

Tie all return due dates to federal due dates. While Iowa returns are generally due at the end of the month federal returns are due, there are exceptions. For example, non-resident alien individual federal returns are due on June 15, but Iowa wants them on April 30, and imposes penalties if they are filed on the federal deadline. That's unfair and un-neighborly.

Then there are reforms that would be harder to enact, but that have policy arguments that are so strong, they might win out. These would include:

Encourage or require "composite" returns or withholding for pass-through non-resident taxpayers. Almost all other states do a version of this. This would make it much easier for Iowa to collect taxes on Iowa-source income from non-resident owners partnerships and S corporations, and would almost surely generate revenue that could be used to lower rates.

Repeal the deductibility of federal taxes in exchange for lower rates. Just incorporating the tax benefit of the federal deductibilty into Iowa's rate structure would bring the top rate down from 8.98% to somewhere between 5.5% and 6.9%.

Repeal "refundable" or "transferable" incentive tax credits and roll the savings into lower rates. When "refundable" credits exceed your Iowa tax, the state mails you a check for the difference. "Transferable" credits can be sold -- in effect, allowing third parties to buy Iowa tax reduction at a discount. These amount to unappropriated subsidies; if the legislature wouldn't vote a corporate subsidy as an appropriation, it shouldn't be paid  through a tax return. 

Iowa's research activities credit alone gave checks to corporations of $37 million in 2014 -- $11.7 million to a single corporation. Just ending the refundability of this credit would save the state enough revenue to shave a full percentage point off of Iowa's highest-in-the-nation 12% corporation tax rate.

That's the easy stuff. Enacting just these ideas would improve Iowa's tax system, but that would leave much undone. What would an Iowa income tax look like if we wanted to start it over and make it as friendly as possible for taxpayers and growing Iowa businesses? We'll talk about that next time.

 

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