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May 2008



Why should I care what happens at this company?  I do my job, keep my mouth shut, and go home.  I have no influence, no power, and no one cares about me.  Just leave me alone and everything will be fine.  Nothing will change no matter what I do.

If these thoughts ring true for your company, you have an infestation of apathy.  This may well be the number one killer of motivation, creativity, and efficiency.

Apathy is a clear sign that there is no linkage between what a person does and some higher purpose - a better world, bonuses, profits, stock value, work-life balance, etc. I guarantee that employees who are infected with apathy will never take the extra step, the extra minute to finish something, worry about equipment, and they may even border on the fringe of sabotage.

Take a minute and reflect back on your own career and I am sure you will recall your own periods of apathy - not a pretty picture.  This is the picture that may well be the center of your company's culture.  You should also take note of how many of your people in leadership positions have the apathy bug.  These leaders are like an incubator and increase the level of apathy infestation.

Apathy can be defeated by sharing financial information, involving people in decisions that affect them, creating a sense of pride about your company, and providing opportunities to learn.  The opposite of apathy is engagement and successful companies have made engaged employees a priority.

Today's business environment is too competitive to ignore the issue of apathy.  Do not let apathy become your company's eulogy.

Flickr photo by apathy_obsession

Are you prepared for a catastrophic event?

Tornado When discussing insurance, you may think insurance agents always want to ask you questions that are so far fetched. I mean really, you’ve never filed a claim, so how likely could something catastrophic happen to you?

I don’t know this for sure, however, I feel pretty confident that the residents of Parkersburg did not think such an event would happen to them either.

I have been in the insurance industry for 10 years and am still amazed when an event such as this occurs. The devastation that the residents of this community are going through cannot be put into words. Their homes and businesses are destroyed - simply wiped out in a matter of minutes. These people have lost everything they own and then some.

So what can you do? Well for one, you need to review your coverage.

The purpose of your insurance policy is to be there for you in the event of a loss. If you are not reviewing your insurance policies with your agent on an annual basis, you are doing yourself a disservice. 

Many things change in the course of a year. Your business could grow faster then you originally projected. Perhaps you purchased new business equipment or rented a storage building. All of these changes need to be considered on your insurance policy.

The next thing is to ensure you have the right coverage in place.

If you are a business owner, ask yourself, if a similar situation as in Parkersburg happened to you:

  • Would your business be affected?
  • Could you incur any additional expenses?
  • Could you recreate your records or accounts receivables?

If any of these questions are a concern for you, then you may want to review your policy with your agent and make sure you have adequate accounts receivable coverage, business income and business expense coverage.

What about documentation?

  • Do you have an itemized list or photos of your business or personal property?
  • Where are you keeping them?
  • Do you back up your records?
  • If so, where are you storing your back up files? 

As you can see with Parkersburg, it’s not going to do you any good if you are backing up your records and keeping them in your office. If your office is destroyed, so are your records. You may want to look into backing them up and storing them offsite. There are several companies that offer this service for both business and personal records.

I don’t mean to be ominous and this is not a ploy to get everyone scared so they buy more insurance. I am just being realistic.

A recent article at Entrepreneur.com says that 4 out of 10 business professionals admit to not being prepared for a disaster. Why? Because it's not a priority and they're not quite sure what to do.

Take the first step - talk to your insurance agent. Having good communication with your agent can ensure that you have the right coverage in place when you need it.

But how do they feel?

265882178_f548b61408 We spend a lot of time wondering what our customers think and know.  We want to make sure they have the specs, the facts, the details and the features.  All well and good.

But in the end, not what matters.

Every purchase anyone makes (yes every and anyone) is based on emotion.  Most marketing material is packed with fact and a little light on the feelings behind the those facts. 

Take some time and put yourself into your customer's shoes.  Why do they really buy?  What emotion does your product or service serve?  Do you give them peace of mind?  A sense of security?   A little re-found youth?  Are they looking for a solution to feeling overwhelmed?  Do you help them celebrate something they love?  Or protect it?

The real question you have to ask yourself is this.  How did you make them feel?

flickr photo courtesy of almoko

FriendFeed: A cure for social networking fatigue?

LogobigNew social networks and applications pop up every day, causing many to suffer from what is known as "socal network fatigue." You've got too many usernames and passwords across multiple platforms to remember, and you've got different circles of friends spread across all the networks. This deluge of information can be difficult to manage.

Now, services are springing up that aim to help us with the social networking overload. One of particular interest is FriendFeed. Basically, you sign up once, enter all your logins for the various networks you participate in, and FriendFeed spits out a "life stream" of data about what you're doing.

Imagine all of your recent Twitter and Facebook updates, Flickr photos, blog posts, Upcoming.org events, StumbleUpon bookmarks and favorited YouTube videos mashed together with what you're currently listening to on Last.fm - all in one central feed.

That's what FriendFeed is - a chokepoint for all of the scattershot data we post about ourselves online, and perhaps a temporary cure for social networking fatigue.

Winding Up

When the day is done for a business, Iowa may have a special break for taxpayers who have hung in there a long time.  A taxpayer has both owned and "materially participated" in a business for 10 years may have no Iowa tax on on the gain from the sale.  "May" is the key word here, as not every business sale qualifies.  There are a number of conditions you have to meet to qualify for the "ten and ten" exclusion. 

  • 200805221biz You normally have to sell "substantially all" of the assets of the business to qualify for the exclusion (though it can apply to sales of real estate even if the rest of the business isn't sold).
  • A sale of corporation stock or a partnership interest normally won't qualify (but sometimes proceeds of a corporate liquidation may).
  • To determine whether you have "held" the business interest for ten years, you look to federal tax law holding period rules.
  • To determine whether you have "materially participated" in the business for ten years, you look to the material participation rules in the federal "passive loss rules."
  • Special rules apply to farmers.

As you may have guessed, these rules can be quite complex, so talk to your tax pro before you sell your business if you think you might qualify.

Speaking of winding up...

I understand IowaBiz.com will close up shop at the end of this month, so this is my last post here.  It's been awful nice of our friends at Professional Solutions Insurance Services to sponsor this blog and feed the bloggers once a month.  Thanks, guys!   Be sure to keep them in mind when covering your risks. 

Please stop by the regular sites of the IowaBiz bloggers; I post daily at www.taxupdateblog.com.  I hope to see you there.

Flickr image by jaycoxfilm. 

Nudge Your Way to Success

Inertia Inertia is a killer! Just ask that diabetes patient on her deathbed who was going to get serious about eating right and taking her medicine -- next Monday. For the past five years.

Inertia is deadly for those of us in the work-world as well. If only we could get up the momentum to:

  • read one critical industry publication every week
  • give positive feedback to our star performers
  • keep our Outlook folders organized

But inertia works against us. In physics, inertia is an object's resistance to a change in its state. Remember Newton's words: "an object in motion tends to stay in motion, and an object at rest tends to stay at rest." And oh, how we love to rest.

Two University of Chicago professors, Richard Thaler and Cass Sunstein, in their new book, Nudge, ask this provocative question: "If you design a choice the right way, could a small nudge help people make better decisions?" According to their research, the answer seems to be "Yes!" Get inertia -- or should we call it laziness -- working for ya! Here are some examples:

  • In Germany, like the U.S., you have to opt in to become an organ donor. 12% of Germans opt in. In Austria, people are organ donors by default. They have the right to opt out at any time but guess what...they don't. 99% of Austrians are available as organ donors. The momentum of staying "in the program" is stronger than the initiative it takes to opt out. That's Austria's way of putting the "default option" to work.
  • Think of that book club or coffee club that keeps sending you books and coffee that you don't need ... and don't even want!... but having to DO something to get them stopped takes more effort than the inertia of accepting them. Can you see the default option at work here?
  • Was that 75 cents you paid for the USA Today outside your last hotel room door really what you'd have chosen to spend your money on? Probably not. But sticking the paper into your briefcase was easier than calling the front desk and going through the hassle of trying to get your 75 cents back, wasn't it? Do nothing, accept the paper and the default option is at work once again.

Here's your assignment:

Q.: What could you gently nudge yourself (or your employees) to do, that would get you going in the right direction and then, the momentum would keep you going?

Q.: What's a choice that you know you need to make? Now how could you design that choice so that doing nothing makes it happen? Over and over again.

Photo on flickr by hoobygroovy

The Right Time To Depart

707085048_ca3cb690be_m_3One of the key elements of a highly evolved company culture is leadership transition.  The leadership transition may be the most important task of being a leader.

Good leaders think about their departure early in their careers.  They combine vision, business goals, and personal goals to create a plan that enables the business to continue on successfully.  The biggest hurdle in this process is making the emotional choice to pick a time.  In far too many instances the leader cannot let go emotionally and that is when trouble begins.  If a leader cannot let go emotionally, it can become a very stressful time for everyone.

Organizations have a life of their own and must grow and evolve over time.  New leadership is vital to organizations. If you are the leader in your organization, have you taken the time to plan for your departure?

I encourage you to start a dialog with your board, key staff, and family.  As with anything, the more you plan the better the results.

Flickr photo by simply

In Case of Emergency, Break Glass

Fire_extinguisher A picture is worth a thousand words.  Do you have an action plan in place just in case things get really wild and crazy on your project?  Do you know what you need to do first?  Second?  Whom should you call?  What is the first meeting you should hold?  What messages should you relay?

We spend a lot of time and energy on business resumption and disaster recovery plans for our organizations.  Do we know how to apply these concepts for our projects?

In your next risk management plan, put in a scenario for "everything bad happens at once" and see how well you can prepare for it

Carpe Factum!

Tag! You're it.

561962_price_tag5b35dThis week I discovered an interesting project called Brand Tags (Brandtags.net) - where visitors can drop by and "tag" popular brands like Coca-Cola, Microsoft, GE, etc.

Tagging is commonplace throughout the Web. While watching YouTube videos, you may notice a cluster of descriptive words to the right - those are "tags" that the user has added to help categorize where the video belongs. Brand Tags works in a similar fashion, except that you "tag" based on your perception - not categorization - of the brands.

Brand Tags is fascinating because it gives us a window into the collective mind of hundreds of thousands of people and how they currently see large companies - companies that spend billions of dollars to shape our perceptions.

Here are a couple examples of brands and their corresponding tags:

Brand: Apple
Tags: Cool, Design, Awesome, Innovation

Brand: MySpace
Tags: Annoying, Friends, Music, Kids, Teenagers, Ugly

Brand: Google
Tags: Search, Everything, God, Evil

Brand: McDonald's
Tags: Cheap, Fat, Food, Unhealthy

This is just another great example of how social mediums have leveled the playing field between large organizations and their consumers.

Lay the foundation first

19156778 I’m the first to advocate great creative.  If your marketing materials are boring or just like everyone else’s, you’re going to get lost in the shuffle. 

Strong, memorable creative can make your ad pop off the page or your brochure be the first one they reach for.  But, way too many marketers leap right to the creative execution.  Who can blame them – it’s fun.

But, you have to lay your foundation first. The foundation of any marketing piece is the strategy.  Do you understand your audience and why they would want your product/service?  When it comes to crafting your message, there’s an easy formula to make sure you’re helping your potential buyer understand why they should buy. 

Problem:  This is how you get their attention.  Show them that you understand their problem.   Use vivid language to remind them of how troublesome the problem can be.  You want them to recognize themselves and their pain in your ad.

Solution:  Once they know that you understand their concerns, they’re ready to hear how you can help them solve their problem.  Explain how they will benefit from your solution.  What will it change for them?  How will life be easier, better, cheaper, smarter, etc.?  Paint a picture with your words. 

Call to action:
  Don’t make it hard for them to buy. Make your communication compelling.  Give them both a reason and a method to act immediately.  A number to call.  A URL visit.  A special bonus if they buy within a certain amount of time.

Pretty simple, right?  But look through the paper or listen to the radio.  Most of the advertisers out there are missing the boat.  Hopefully your competition is among them!  Follow this easy formula and you’ll already be ahead of the pack.

Ignore them and they will come

My pulse stll quickens a bit when the mail comes. Sure, you know it's mostly bills and flyers, but once in awhile you get a letter from an old friend, or an unexpected check. But for pulse-quickening, there's nothing like a letter from the IRS.

200805111Some people panic when they get a letter from the IRS. Others take a less practical approach - they put the letter in a drawer and forget about it. Neither approach is recommended.

When the IRS writes you, you should pay attention. Common letters from the IRS include:

- Adjustment to refund. Sometimes taxpayers forget to make an estimated payment, or forget that they did make one. These letters usually don't require a response, but you may need to adjust your current year payment schedule. If you do need to respond, they'll tell you so.

- Matching notice. If you don't report interest, dividends or wages that were on a W-2, the IRS will come asking. This kind of letter requires at least an explantion; sometimes the correct response is a check.

- Notice of examination. This one requires serious attention; it's probably time to visit your tax pro.

- Notice of deficiency. This "90-day letter" means business. If you get one of these, either you pay up or your plan to battle the IRS in Tax Court. You get one of these, you definitely need to check in with the tax pro.

- Notice of intent to Levy. If you get one of these, not only will they not go away, they're coming for you.

Kay Bell, proprietor of "Don't Mess With Taxes," has a nice summary of the different sorts of IRS correspondence. You can also learn more at www.irs.gov.

The moral? Deal with the early letters properly, and you aren't likely to get the later ones.

Limited Liability Protection is Not Absolute

465459020_c19293614a One of the main reasons for incorporating or forming a limited liability company is protection from personal liability for business debts and claims. While corporate and LLC owners enjoy this limited liability in many situations it is important to realize that limited liability is not absolute. A corporate shareholder or an LLC member may be held personally liable if he or she:

  1. Personally and directly injures someone;
  2. personally guarantees a bank loan or other business debt and the company defaults;
  3. fails to deposit taxes withheld from employees' wages;
  4. intentionally engages in fraud or illegality which causes harm to the company or someone else;
  5. mixes business and personal assets and does not maintain separate accounts for the business and personal finances.

The Wolfe Law Group has some excellent tips on how to avoid piercing the corporate veil
Business insurance may be helpful in certain situations to protect you if limited liability does not apply but many insurance policies contain exclusions for intentional acts.
The best practices for running your corporation or LLC is to make sure you keep your personal guarantees to a minimum, pay applicable taxes and keep all business dealings separate from your personal accounts.

Photo courtesy of flickr by Darwin Bell

Over-communicating is Under-rated


Don't over-eat. Try not to over-do it when you exercise. And for heaven's sake, don't over-extend your credit.

But when it comes to communication...well, that's another matter.

I was at a client's facility the other day and they had posters in every building that said, "Around here, we over-communicate." It's one of their values.

I have an executive coaching client who has "Over-communicate with my manager" as one of the tactics in his action plan. Why? Because his manager wants to be "in the know" on important things. Not to micro-manage or meddle, but to be in the loop, on top of things. No surprises.

George Bernard Shaw was picking up on the need for over-communication when he said, "The single biggest problem in communications is the illusion that it has taken place."

  • Leaders mistakenly think sometimes that if they've said something once, it's communicated. Employees heard it. They understood it. And they accepted it. In reality, they couldn't be more wrong. Until hearing something numerous times, most of us are clueless about what was even said, much less meant.

The more important the issue or topic of conversation, the more important it is to over-communicate. Keep these basic truths in mind:

  • Simplify your message. The key to effective communications is simplicity. Don't use five sentences if two will do. Make simplicity and clarity your friends.
  • Seek a response. The key to effective communication is dialogue, not a series of monologues. How will you know if your message is getting through if you don't watch and listen for the response to your words?  Listen with your heart.

Eliminate the scourge of assumptions. Over-communicate!

Photo on flickr by david samuel

Frugal To A Fault


I am sure you know many people who are frugal.  They do not do much, they get buy with the least of everything - one pan, two sets of clothes, simple foods, and do not drive.

The frugal concept in business is used to conserve cash and keep prices low.  The frugal difference between a person and a company is that a person is alone and a company is group of individuals.  The individual that practices frugal living can make his choices quickly and not impact others lives in a big way.  In a frugal company it is not that simple.

The leader of a frugal company cannot be the lone believer.  They must have the support of the organization to be frugal otherwise people become zombie employees who care about nothing.

Imagine a CEO who spends time saving printed paper to reuse the back side of the paper, or spends hours and days searching for the best deal on the smallest items, and even goes through buildings to find rusted, wasp nest infested conduit to use in wiring equipment.  In today's world a CEO must be frugal, but keep in mind how your employees view these actions.  The top paid person is spending $50, $100, or more dollars an hour on these activities - which costs the company and does not add value.  I do not dismiss the concept of setting an example, but be cautious of stupidity.

Remember that everyone watches the leader and scrutinizes their actions.  The value of being frugal with dollars can lead to the loss of business, growth, and good people.  Keep a strong balance sheet, but make sure that you are always making investment in your company by spending dollars on training, process improvements, updated equipment, and offering an employment package that attracts the best and brightest.

Flickr photo by NotAgainFarm

Will The Blues Bring Lightning?

36876579 Is it just me or do you have the blues too?  It has to be Spring, children are playing soccer, baseball, running track, and even flag football.  I've even seen a robin so it must be true.  The Drake Relays have come and gone. 

Spring is here but it has not sprung.

With spring comes your favorite meteorologist telling you about the crazy weather patterns.  The weather drives insurance companies crazy.  Believe it or not, insurance carriers look at weather data and records from years past and try to predict if it will be a profitable month or not.

Since insurance companies and meteorologists can't predict the weather patterns, it’s good thing we can all carry insurance.  Bad weather and the bad news that sometimes comes along with it, can strike at any time.

Late at night you see a flash in the sky and hear the thunderous boom and say to yourself, "Wow, what did that hit?"  You wake up the next morning and head to work.   When you arrive you fire up the coffee pot, start your computer, and turn off the phone recording system for the day.

Houston, We Have a Problem   

Nothing is working...

This is where your morning might get worse. Your agent said the policy you have is an all-risk policy, so you automatically make the assumption you are covered.

In this particular situation you don't know the exact cause of the loss.  You think it was lightning, tell your agent it was lightning, and he says, "Lightning is covered." 

After further investigation of the cause of loss by the insurance company you are informed that you have no coverage.  Lightning did cause a loss but it was not on your premise, it was actually a power surge from an electrical station four blocks away.  And you’re not covered for that.

Uh oh.

As the Spring storms approach, take a few minutes to check up on the wording of your policy when it pertains to lightning and its effects.

It's A Date

Dsc_0067I had to chuckle when I drove past a local arena and saw the sign advertising the Cinco de Mayo concert... on May 3rd.  Evidently, somebody neglected to tell the planners that "cinco de Mayo" is Spanish for the 5th of May.  Oh well.  I'm sure the concert content is great, regardless of which day it occurs.

In project management, we talk a lot about late tasks and how these impact the project and the organization.  Sometimes, we neglect the impact of tasks that come in too early.  An older post at the Ever Changing Crusades blog yields a valid issue on completing projects too early:

Since I mentioned Dead Lines.......back at my previous job,  I had absolute dead lines.  Everybody did.  What was the point in getting a project finished too early and then something, at the last minute, changes the outcome and have to redo the work?  My view was/is to just wait until all the facts were in, and then do the job.

So assess your tasks.  Think about the predecessor and successor relationships.  Look at impacts and resources.  If your task needs to finish on a specific date, then don't try to overachieve.  (Mind you, don't procrastinate either.)  Just get it done... right... and on time.

Carpe Factum

Every customer has a choice

60502477 Do you exercise your freedom, your right, to choose?

I do.

Businesses that don’t listen to customer concerns or to feeds will eventually have to listen to a loss of revenue. Businesses that do a great job deserve the reward of our loyalty. Only when we choose with our feet and our pocketbooks will some companies hear the message.

Have you exercised your choice?

Post a comment and tell us about a business you’ve chosen to reward with your loyalty, or a company you’ve chosen to avoid.

People talk about your company online, but who should you listen to?

Wonderinghead_questionmark Social media has given power to the people, and with it, your consumers now have the ability to publicly share their experiences about your company or product online. Sometimes positive, and sometimes negative.

If you're currently participating in the "listening" basics (tracking mentions of your company name in Google News Alerts, Google BlogSearch, Technorati, etc.) you will immediately find out when a customer starts talking about your business on a message board or blog. Whether these conversations are positive or negative, you can - and should - dip into the conversation stream with them.

Yet, the larger an organization is, the less time they can devote to following up on every single online reference or mention. So how do you discriminate?

First, check out the user who is posting the information. Let's say the environment is a message board, and the user is very active within that space. He/she has over 3,000 posts. This is somebody you want to pay attention to, and potentially follow up with. Even within self-organizing communities like user forums, leaders (influencers) still emerge.

Now, say there are 10 blogs that have posted glowing reviews about your product or service, but you only have time for a few "thank you" follow-ups in their comments area. Do some research into who the bloggers are first. Determine their reach and influence. How big of a voice do they have? Are their blog readers actively engaged? Are the readers leaving comments? If you see a lot of "Comments: 0" you may want to pass it up.

There are many conversations happening right now on the web, some of them about your company. Depending on your organization's size, developing an ability to filter through it and identifying the key influencers will be vital to your social media strategy.

Nathan T. Wright

Taking your show on the road

Picture_1 Trade shows are an incredibly effective way to introduce your business to a wide array of potential new customers.  When it comes to displays, I have some good news and some bad news.  Want the good news first?  Your competitor's booths probably stink.  Ready for the bad news?  Yours probably does too.

Here are some rules to think about when you or your agency is working on your display.

~ What's the point?  Identify the one fact/impression you want everyone to remember from your display.  Not three main points or five.  One.  Once you have communicated that, stop. 

~ Force them to stop.  Do something so visually arresting that people cannot help but stop.  This is not the time to be timid.  Be bold.  Grab them and (figuratively) drag them into your space.  I'm not talking (unless it fits with your brand) something silly.  I am talking relevant but WOW!

~ Think of it like a billboard.  Be brief.  This is not the place to reproduce your sales letter or brochure. 

~ Less is more.  Some companies trade show space is like a three-ring circus.  People do not want to walk into chaos.  Having one good, bold idea is much more effective than throwing the kitchen sink at the attendees. 

~ Do it right.  Yes, you are going to have to spend more money.  But, it is an investment that will last for years.  This is not the place to go cheap.  It will be glaringly obvious and speak volumes about your business.

If you're going to invest the money and time resources to have a presence at a trade show, make sure you maximize that investment by having a display that they'll remember long after the show doors close.

This site is intended for informational and conversational purposes, not to provide specific legal, investment, or tax advice.  Articles and opinions posted here are those of the author(s). Links to and from other sites are for informational purposes and are not an endorsement by this site’s sponsor.