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This quarter, as we increase our readership, we thought our focus should be on those things that are impacting you the most. We’ve kept some of the favorite sections like our book review now contributed by Geni Whitehouse, and our sections on sales and marketing, leadership and customer relationships. The hot topic this quarter is the increase in fees that impact us in our businesses and personally every day. These are on everyone’s mind and we thought we would bring you some tips to help you navigate through this world of increasing prices. Check out our articles on outsmarting airline fees and the attack of bank fees.
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The Tax Cut Act:Important Benefits for Small Business
BELLWETHER
Practicing Bad Profiteers
Bellwether Magazine | Second Quarter 20112
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©2011 Kissinger Associates, Inc. All rights reserved. Reproduction in whole or in part without permission is prohibited, and information contained herein is subject to change without notice. Kissinger, EDI Advantage 2010, Smart Software That Means Business, and associated Kissinger logos are trademarks of Kissinger Associates, Inc. Sage, the Sage logos, and the Sage product and service names mentioned herein are registered trademarks or trademarks of Sage Software, Inc., or its affiliated entities.
Visit Kissinger Associates at Sage Summit 2011 > www.sagesummit.com
Cut Your Costs with
3bell•weth•er -noun: one who takes initiative or leadership
Bellwether Magazine | Second Quarter 20114
se
ct
io
ns Letter from the Editor 5
Book Report 6
Leadership 7
Sales and Marketing 8
Customer Loyalty 9
Cover Article 12
Industry news 14
Featured Article 16
Social Networking 18
State of the Economy 20
Leadership 22
Work | Life | Balance 23
12
14
18
People ask the difference between a leader and a boss. The leader leads, and the boss drives.
Theodore Roosevelt
LEARNING FROM THE PRACTICING
BAD PROFITEERS
To Be or Not To Be...
SOCIAL
5bell•weth•er -noun: one who takes initiative or leadership
LETTERFROMTHEEDITOR
BELLWETHERA Blytheco, LLC Magazine
Volume 2Second Quarter, 2011
www.blytheco.comwww.bellwethermagazine.com
STAFFEDITORApryl Hanson
CREATIVE DIRECTORGreg Went
CONTRIBUTING WRITERSAlicia AndersonRon BakerApryl HansonDick LeeCortez NaPueKaren PriceDawn WesterbergGeni Whitehouse
ADVERTISING SALESDori Fitch
SUBSCRIPTIONSwww.bellwethermagazine.comOr contact Dori Fitch - (800) 425-9843, Extension 1168dorif@blytheco.com
Bellwether Magazine is published by Blytheco, LLC with principal offices at:23161 Mill Creek RoadSuite 200Laguna Hills, CA 92653
If you wish to be removed from the mailing list or to add names to the mailing list, send your request, including name, business name, and mailing address to the above address or to dorif@blytheco.com
This is a copyrighted publication and all articles herein are covered by this copyright. Any use of the content for commercial reasons or other form or reproduction of material herein is strictly prohibited without prior, written approval of Bellwether Magazine.
Theodore Roosevelt
LEARNING FROM THE PRACTICING
BAD PROFITEERS
SOCIAL
Bellwether Magazine | Second Quarter 20116
by Geni WhitehouseBOOKREPORT
Evil Plans: Having Fun on the Road to World Domination Hugh MacLeod
Famous for his cartoons on business cards, Hugh is an unlikely prophet. But he has a
powerful and important message about doing what you love – which he calls your “Evil
Plan”. He describes his own journey from advertising agency to blogger extraordinaire
and throws in great stories and funny cartoons along the way. Like Vaynerchuk, MacLeod
believes in going all out in pursuit of whatever it is that lights your fire. To be successful,
MacLeod says evil plans for world domination have to be wrapped in excellent stories
that lend themselves to socializing. It seems you can’t hatch a successful evil plan in a
vacuum.
Crush It! | Gary Vaynerchuk
Short and sweet (and less than 15% alcohol), this book tells the story of a wine wholesaler who
became an internet sensation. Gary Vaynerchuk has a passion for wine and he’s not afraid to
share it. While his approach is extreme (he doesn’t sleep and never seems to stop working) he
has a powerful message. The key is to have a maniacal passion for your idea. Businesses of
every size can benefit from his success in using social media to share that passion. While you
might not want to spend every waking moment being connected or getting social, you can
learn a lot from his ability to create a community of dedicated followers – who eventually turn
into buyers.
Who are you People? | Shari Caudron
This book explores passion from the perspective of hobbyists. The author
set out on a journey to uncover the motivation behind fanatical obsessions–
she wanted to know what made these people tick. While she didn’t uncover
the passion gene, she did gain insights into (and respect for)
the power of shared passions in uniting people from diverse
backgrounds. This book is great fodder for any business owner
who is trying to build a community of raving fans – you never
know what you can learn from Barbie convention attendees,
Josh Groban fans, or the pigeon people. It’s a perspective-
shifter that might just open your eyes and give you new ideas that
you can apply to your business. You might even end up with a new
hobby.
7bell•weth•er -noun: one who takes initiative or leadership
BOOKREPORT
Questionsare theAnswer
Einstein said “Failure and deprivation are the best educators and purifiers.” Applying
that to leadership in business (or any other type of leadership) allows you the freedom to fail, and
learn from it. I recently had a project that didn’t go as planned. It gave me and my team the opportunity to tear it apart, and start over from ground zero dissecting the things that went wrong. As leaders we have the privilege of asking questions of the people that we work with to help them get creative in learning from their mistakes, instead of feeling punished by them.
In Managing for Results, Peter Drucker writes
“Searching for potential of opportunity in
a company’s vulnerabilities, limitations and
weaknesses is therefore likely to be resented
by its most accomplished people as a direct
attack on their position, pride and power. This
is the reason why the opportunities are often
not realized by the industry leaders but by
people on or near the outside.”
As leaders, how do we allow ourselves to stay
close to the outside and not get wrapped up
in emotion and ego when looking at business
challenges? It comes back to asking yourself
and others around you questions like:
• What worked well about this situation,
project (or what is working well in the
business)?
• What isn’t working well?
• What would we do differently next time?
• What is my gut telling me about this
situation?
• Were there any signs early-on that this
wasn’t working that I ignored?
If we allow ourselves the ability to self reflect as
leaders we will develop teams that learn to self
reflect, diagnose, and move on to solutions
instead of harping on issues in our businesses.
Mastering this skill will require discipline
but it will be very rewarding.
LEADERSHIP
by Apryl Hanson
Bellwether Magazine | Second Quarter 20118
At the macro level, there are only three pricing strategies: Skim, penetration and neutral. There is no doubt price can be an effective way to compete
for some companies. Think of Wal-Mart, Southwest Airlines, Costco, Dell Computers, or Timex watches—all use a penetration pricing strategy. All have used price as an effective competitive differentiation, relentlessly driving out needless costs from their operations, passing the savings on to customers.
On the opposite side of the spectrum is Apple, BMW, Bose, Disney, FedEx, Godiva, Gucci, Lexus, and Nordstrom, all of which command premium prices—a skim pricing strategy—because they offer premium quality, total quality service, and exceptional customer experiences.
In the middle are companies such as, Buick, Seiko watches, JC Penney, Sony televisions, and Toyota, where price plays a more neutral role.
Far more consideration should be given to which of the three generic pricing strategies will guide the company’s pricing. Let us examine them to gain an understanding of which strategy is appropriate given the realities of the marketplace.
Skim Pricing
In any market, there are a certain segment of buyers who are relatively price insensitive because they value the offering so highly. Think of early adopters in the technology industry who rush to purchase the latest and greatest gadgets, newest high-speed computers, printers, and audio equipment.
Skim pricing is a conscious decision to sell to this segment at premium prices more commensurate with value, thereby earning more profit than could be made selling at a lower price to an albeit wider market. The company is not so much interested in market share as it is in extracting the perceived value from this smaller segment of the market.
Penetration Pricing
Penetration pricing is when the company decides to set the price below the product’s value to the customer, thereby ensuring a larger customer base. It is the trade-off of higher revenue versus higher margins, and can be a very effective strategy especially for new entrants into particular markets.Penetration prices are not necessarily cheap, but they are low
relative to perceived value. For instance, Lexus used a penetration pricing strategy to bring Mercedes, Audi, BMW, and Porsche to their knees when it launched its LS (luxury sedan) 400 in early 1989 at $35,000, 40 percent less than BMW, Mercedes, and the same as Cadillac.
Penetration pricing can be used at any stage in the service life cycle, and is usually deployed after a steady customer base is established to drive revenue. To reiterate, though, it is a price set relative to the product’s value, not a competitor’s price. Do not let your competitors determine your price, as they have no interest in your company’s long-term viability.
Neutral Pricing
The neutral pricing strategy is generally a default strategy. In effect, this strategy minimizes the role of pricing in the marketing mix, not utilizing price to gain or restrict market share. A firm may select this strategy when it knows its product, promotion, or distribution offers other more powerful advantages to the customer.
The neutral price does not mean a price in between that of competitors, but in relationship to the firm’s value. Apple laptop computers and Sony televisions, for example, are consistently priced above competitor levels, but because they offer such excellent value, the market still perceives the price as neutral.
Which pricing strategy does your company use?
“In any market, there are a certain segment of buyers who are relatively price insensitive because they value the offering so highly.
Ronald J. Baker is founder of VeraSage Institute and the best-selling author of The Firm of the Future: A Guide for Accountants, Lawyers, and Other Professional Services; Pricing on Purpose:
Creating and Capturing Value; Measure What Matters to Customers: Using Key Predictive Indicators; Mind Over Matter: Why Intellectual Capital is the Chief Source of Wealth; and his latest
book, Implementing Value Pricing: A Radical Business Model for Professional Firms, from which this article has been adapted. E-mail him at Ron@verasage.com and follow his blog at www.
verasage.com.
SALES&MARKETING
by Ron Baker
9bell•weth•er -noun: one who takes initiative or leadership
The traditional meaning of community has broadened to
include online groups who are aligned with a brand or
cause. Often these communities include a movement of
customers raving about a particular product, or binding
together to fight against a brand. As a company, what can
you do to share in the building of your community?
As customers are collecting together on
different social media landscapes
like YouTube, Twitter,
Facebook and
LinkedIn, what
will the future
of these
communities look like? What can we do to put our best
foot forward?
Chris Brogan, President of Human Business Works, an online
education and community company for small businesses
and New York Times bestselling co-author of Trust Agents,
says in his blog (www.chrisbrogan.com) that successful
communities will require authentic loyalty, to and from the
customer. However, he states “Oddly, loyalty programs of
today push the reverse of loyalty: sign up and we will beat
you with even more mail than people who casually swing by.
Sign up and we’ll bother you until you buy. Sign up and we’ll
share your data with other people.”
This has to shift. Membership in a customer community
needs to be more of a shared value experience. Loyalty
should mean “feeling like you’re on the inside” and gaining
access to the exclusive benefits of the group, whether
those benefits are as simple as information, or as “real” as
discounts or other gifts.
This emphasis on community puts more pressure on small
businesses to take their brands online, but without someone
to listen and correspond with community members, you
leave your brand to chance. There are plenty of software
packages that can make it easier to engage with clients
and decrease the amount of time that it takes
to stay involved. This is new territory for most
businesses yet we are increasingly feeling
pressure to participate.
CUSTOMERLOYALTY
by Ron Baker
DELIVERING ON COMMUNITY
by Apryl Hanson
What does community mean to you? Our world is changing! I knew that there was a turning point when I was at my favorite restaurant
I have been going to for 15 years and the owner says “Are you following us on Facebook?”
Bellwether Magazine | Second Quarter 201110
The goal is for you to fall in love with your business again.
Begin a process of fun work with the purpose of awesome results.
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Hey...we’ll even send them to our readers at no extra charge!
Advertise in Bellwether... ...it makes ‘cents.’
www.bellwethermagazine.com/ads*Based on 1/2 page color ad sent to our 20,000 plus print readers.
Marketing StrategyMarketing Plan and CalendarCampaign Development Marketing MetricsContent DevelopmentPublic RelationsSocial Media
www.dawnwesterberg.com
Geni WhitehouseSPEAKER AUTHOR
CONSULTANT NERDShe’s been called the “comedian CPA.” A self-proclaimed nerd, experienced software executive and former CPA firm partner, Geni Whitehouse has made it her mission to eliminate boring from the world of presentations.
STRATEGYEXECUTIONEVANGELISMCONTENT DEVELOPMENT
www.evenanerd.com
11bell•weth•er -noun: one who takes initiative or leadership
Good marketing has that kind of energy and focus behind it.
Good marketing says to your prospects: I realize that you are
special and I will go out of my way to make you feel special.
Do you have a sweetheart list? A sweetheart list is a short
list of accounts you would love to have. Maybe it’s based
on the characteristics of the company. Maybe it’s based
on the fact that the company has name recognition or is a
forward-thinking leader in your market. Whatever the reason
– doesn’t it make sense to approach them with the following
purpose in mind? “I realize that you are special.” “I will go
out of my way to make you feel special.”
Let’s say you have a sweetheart list of 12 – set up a Google
Alert for both the company and the contact. Every time you
get interesting news via Alerts you have a reason to email
or call.
Have you searched them out on Twitter, Facebook and
LinkedIn? Try to make a connection via social media. If
they are on Twitter, you can respond to their Tweets or RT
(retweet) their observations and links. If they are posting
on Facebook, you can leave a comment. If they connect
with you on LinkedIn, you’ll be alerted as to any change
in their status (promotion, move to another company) and
if they participate in any groups, you’ll know that as well.
It’s probably worth your time to join the group as well if it’s
appropriate.
Do they have a blog? The fastest way to a blogger’s heart is
a thoughtful contribution to the comments section.
Use every platform to communicate (I’m not suggesting
you spam them). Observe their habits and see if there is a
particular communications preference they have. Use email
to congratulate them on the good news about the company
that you learned through alerts. Use snail mail to send an
interesting article or helpful tool. Use lumpy mailing to send
a logo’d item.
This could also be called guerilla marketing. All of your
activity is saying “I realize that you are special.” “I will go out
of my way to make you feel special.” After 6 months of this
kind of focus, you will have mindshare. You may then chose
to place them on your nurture marketing list and select
another company to take a spot on your sweetheart list.
Here are possible results:
Nothing will happen. (Rare, but a potential reality.)
The efforts of their current provider will be compared to
your efforts. Chances are very good that (sadly) their current
provider isn’t in the “I will go out of my way to make you feel
special” mode. You will have preferred mind share.
They may not be in a position to buy from you yet, but your
efforts have been noticed, and there is a likely chance that
when faced with an opportunity to make a referral, they will
point another prospect to you.
When they are ready to buy, you will have done such a good
job of distinguishing yourself from the competition, the odds
will be in your favor to win the business.
Remember, it’s not enough for them to decide “I need to
buy XYZ product or service.” Rather you want them to be
thinking “I want to do business with [Your Name Here].”
Years ago, a coworker shared the account of meeting the woman who was to be his future wife.
In courting her, he was relentless in making sure that his sweetheart was receiving regular
deliveries of cards, candy, flowers and later jewelry. His strategy? “If there was anyone she was even
remotely interested in, they would have to run very fast to keep up with me.” Through a variety of
actions and behaviors he was telling her “I realize that you are special.” “I will go out of my way to
make you feel special.”
Courting our Prospects: Marketing Tactics that Say“I Realize that You are Special”
CUSTOMERLOYALTY
www.bellwethermagazine.com/ads*Based on 1/2 page color ad sent to our 20,000 plus print readers.
by Dawn Westerberg
Bellwether Magazine | Second Quarter 20111212
COVERARTICLE
by Apryl Hanson
Bain and Company just released (2010) its study
on Customer Loyalty in Retail Banking for North America.
We all know that bank practices and customer service have
been on a trending downturn for what seems to be most of
the past ten years. In fact, most feel held hostage by their
bank in a never ending battle.
In a blog article by Fred Reichheld, author of The Ultimate
Question, he states that the New York Times reported in
October that a federal judge “ordered Wells Fargo to pay
California customers $203 million in restitution for claims that
they had manipulated transactions to maximize the overdraft
fees they charged.” Instead of processing transactions in the
order in which they were received, Wells Fargo put through
the largest to the smallest. In a stinging 90-page opinion,
United States District Judge William Alsup wrote that the
practice was unfair and deceptive.
It isn’t that Wells Fargo should be specifically
pointed out, but many banks have adopted
similar processes creating an industry
norm and underwhelmed customer
allegiance. In your industry, are
there things that have developed as
industry standards that create a negative
customer experience? These things are somehow
overlooked because we accept the fact that this is how
business is done.
Why?
Instead, might we be able to envision a different way of doing
business outside of the norms that creating uniqueness and
delivering an over the top customer experience. Marketing
books talk about your unique value proposition but most
businesses believe that what they deliver uniquely is their
“customer experience”. While that may be true, I’d challenge
you to think of your business from outside itself, from the
position of your customer looking in. Your customers,
industry standard or not, have the key to what could be you
leaving profits on the table.
So what are bad profits?
Bad profits are charging more for something without
increasing the value that customers are receiving or being
deceptive in how you are doing business. We all should
be in the business of providing something valuable to our
customers and it should create a win-win situation. The
customer benefits from what they receive, and you benefit
from what you receive.
LEARNING FROM THE PRACTICING
BAD PROFITEERS
13bell•weth•er -noun: one who takes initiative or leadership
CONFUSED CUSTOMER
How can you measure your relationship with your clients?
In Reichheld’s book he talks about
the Net Promoter Score (NPS)
which is a loyalty gauge for
your business to understand the
ongoing relationship and potential
recommendations your clients will
give. I like to think of it as a way of
measuring the good or bad press
that is out there about your
company. Think of it as what
someone would say to a friend
if asked about your company.
This is measured by a survey process in which the customer
is asked “On a scale of 0-10 (10 being the highest) what is
the likelihood that you would recommend XXX company to
a friend or colleague”.
The answer to that question gives you the ability to
measure if you have:
• Promoters – those who respond with a 9 or 10
• Neutrals – those who respond with a 7-8
• Detractors – those who respond with a 6 or below
You then add up the total’s you have in each category,
and calculate your percentage of Promoters, Neutrals and
Detractors.
% of Promoters - % of Detractors = Net Promoter Score
(NPS)
Your NPS helps you understand the health of the relationship
with your customers and links to future profitability. For a
deep dive on this I highly recommend you read Reichheld’s
book. There is really
an overwhelming
amount of data on
this, and you should
be measuring this for
your business.
According to
the Bain and
Company study, if there were a bank that would stand out
from the normal day to day business, and increase their
NPS score the benefits would be:
• Customers who are promoters stay longer with your
company than those who are not promoters and in
general cost less to serve.
• A promoter customer is worth
more than one that is a
detractor
• You can have a
growth rate that is
higher than your
competitors
Would that be something that is worth exploring for your business?
These points aren’t unique
to banks, but would be the benefits to any business
delivering high customer loyalty. As discussed above, we
can learn from watching businesses get it wrong, regardless
of the industry. Take a look at your relationship with your
customers and see what you can do to remove bad profits
and increase your NPS.
We would love for you to share your ideas on how you create
unique customer experiences by writing your thoughts to:
‘customerexperience@blytheco.com’
“We all should be in the business of providing something valuable to our customers and it should create a win-win situation.
HAPPY CUSTOMER
ANGRY CUSTOMER
Bellwether Magazine | Second Quarter 201114
With the economy tanking over the past few years, it’s no surprise that many banks are hiking their maintenance fees in order to pass the cost on to their consumers. The Fed has already implemented new banking legislation with new policies that limit the types of fees that banks can charge, however, banks, as clever as they are, have already figured out ways to divert the expense to their customers.
Banks’ recent repositioning of fees is a direct result of the newly implemented Card Act, which bans a handful of fees, including certain overdraft and excessive late charges. The new legislation also prevents over-the-top interest rate hikes. Most recently, the Federal Reserve proposed a cap on debit interchange fees which is what the bank charges retailers when customers swipe their cards.
In light of this, most of the nation’s largest banks have completely revamped their fee structure, introducing a whole new set of accounts for consumers:
J.P. Morgan Chase - Chase announced on Feb. 8th that all new customers would be enrolled in a new Total Checking account. The account will charge you a $12 monthly fee unless you maintain a checking account balance of $1,500, make monthly direct deposits of at least $500, or keep a $5,000 balance across all deposit accounts -- including checking, savings and investments.
If you keep your old account, you’ll get charged a $6 monthly fee unless you make a direct deposit of at least $500 per month OR make five debit card purchases.
Bank of America Similarly, Bank of America announced that they will restructure all of their checking accounts by year end. B of A’s new fees will range anywhere from $8.95 to $25 per month with the possibility of being charged up to $300 extra per month for any account infringement. But customers could get those charges waived if they make at least one direct payment each month or maintain a balance of $1,500. This feature will be eliminated by year’s end (2011) and all BofA checking accounts will be $8.95 per month unless…
You enroll in an “enhanced” checking account and keep a balance of $5,000 in your total linked deposit accounts, which include checking, savings, and investment accounts. You could also choose to deposit at least $2,000 monthly, or use a linked credit card at least once a month. If your balance drops below $5,000 or you don’t meet the other requirements, you will be charged a $15 fee.
Citibank - In September 2010, Citibank began charging monthly maintenance fees of up to $30. The basic
“Free checking is going to become less prevalent, but it’s not going to go away like the dinosaurs.
by Cortez NaPue
INDUSTRYNEWS
15bell•weth•er -noun: one who takes initiative or leadership
PRICING ON PURPOSE presents the theory of value - long established in economics - and details how any business can use various pricing strategies to create, communicate, and capture the value of their products and services. It takes a new approach of focusing on the external value as perceived by the customer and advocates matching price to value. Written in everyday language so it’s valuable to beginning executives as well as professional pricers and marketers, it covers:
checking account charges a monthly maintenance fee of $8 unless you complete five or more monthly transactions, including direct deposit, debit card purchases, bill payments, check payments and/or ATM cash withdrawals.
Citibank also offers an alternative that charges you a fee of $20 unless you maintain a $6,000 monthly balance in linked accounts -- including checking, savings and investments.
Wells Fargo - Ended its “free checking” account in July and now hits customers with a $5 monthly fee unless a minimum balance of $1,500 or monthly deposits of $250 is maintained.
Its other accounts charge fees up to $30, but they can be waived if you meet certain requirements, like maintaining higher minimum balances or making automatic transfers to your savings account. Every Wells Fargo checking account has a free option – something that sets this bank apart from the others.
Wachovia - Customers still get to hold on to their free checking accounts, but they will be fully integrated with the bank’s other fees soon enough-- including $2 charges to receive images of cancelled checks and $10 fees for using your savings as overdraft protection.
HSBC - This bank hasn’t made any major changes over the past year as their basic checking accounts are still charged $3 a month with no way to avoid it.
Choice account users can avoid a monthly maintenance fee of $8 by using direct deposit, keeping at least $1,500 a month in deposit account balances, or by maintaining a
balance of $5,000 across all accounts -- including deposit accounts, credit lines and investments.
How to Avoid The Fees…For Now - While it may seem that the death of free checking has arrived, there are still ways to make your account free.
“Free checking is going to become less prevalent, but it’s not going to go away like the dinosaurs,” says Greg McBride, a senior financial analyst at Bankrate.com.
He further says that “65% of financial institutions still offer free checking, while 23% offer an account where fees can be waived with actions such as direct deposits.” Bank of America however, will not offer free checking of any type come year-end 2011.
“The upshot for consumers is that what will become more prevalent is the ability to avoid fees with certain options that best suit their needs, like direct deposit, using online statements or having aggregate balances with banks,” McBride said.
Fees’ Affects on the public - The new round of fees appear to fall disproportionately on the families of lower-income persons. As evidenced by 67% of all overdraft fees owed in 2008 belonging to lower-income persons, it is projected that some 72% of all new banking fee expenses will be placed on lower-income families. With the nation’s unemployment rate at 9% and close to 50 million Americans living below the poverty line, it is a wonder how families will balance the need to have a bank account with the expense of owning one.
CUSTOMERRELATIONSHIPS
What and how people buyThe fallacy of commodity thinkingThe five Cs of valueThe market share mythThe difference between cost-plus pricing and value pricingA comparison of the Subjective Theory of Value and the Labor Theory of ValueCustomer segmentation strategies
This and other Ron Baker books are available at www.verasage.com
Bellwether Magazine | Second Quarter 201116
FEATUREDARTICLE
The Growing Importance of Business IT Interpreters
This language barrier doesn’t pose a huge problem
for manufacturing folks, because they’re mostly off by
themselves, unless implementing ERP – and even then,
the bulk of ERP users reside in the back office, not on
the factory floor. However, business and IT not sharing
a common language is a huge problem. Just ask either
side about accuracy of communication following any ERP,
CRM, HRIS or other implementation. In fact, based on
our experience, failure to communicate causes far more
systems disappointments and outright face-plants than
flawed technology. Watching business and IT communicate
often reminds me of a tee-shirt my son wears, saying: “I
can see your lips moving, but all I hear is blah, blah, blah.”
But it’s not funny. Companies still pour billions down the
drain every year, investing in systems that only partly meet
business needs, or in some cases don’t meet them at all. In
our customer-centric process practice, focused on office/
service work settings, we frequently ask, “Why are you still
doing this manually?” Often, we hear back, “Well, IT built
us a system but it doesn’t do what we need.” Or, “The
system we bought (sometimes without IT involvement)
doesn’t work.”
Stepping back and seeing the big picture, rarely are these
failures obviously either side’s fault. Both sides often speak
in separate tongues, thus neither understands the other.
But I should add, and I’m “safe” to say this because I am
from the business side, business often makes only token
efforts to communicate, believing IT should somehow
“get it.” ESP, anyone?
As if all this isn’t problem enough, empowered customers
are pushing office/service process towards improving
customer experience – an external goal - while remains
accountable and measured by internal efficiency.
We can divide even most small companies into three elements:
production; front/back office and service settings, including
management (which all together we call the “business”
element); and IT – with service organizations typically lacking the production
aspect. Similarly, we can divide companies into three language groups:
“manufacturing-speak;” “native language” with industry-specific language in
office and service; and tech-talk. Unfortunately, few in most companies speak
all three.
by Alicia Anderson
by Dick Lee
17bell•weth•er -noun: one who takes initiative or leadership
Getting past “blame”
When companies engage us, among the first questions we
ask are: (to the business side) “Is IT giving you everything
you need?” and (to IT) “Are business folks telling you what
they need?”
We used to have to step aside to avoid getting blown over by
the heat of the responses. Today, relations between business
and IT are far more civil, but that’s just a progression from
unfriendly dysfunction to friendlier dysfunction. And neither
side usually takes responsibility,
preferring to blame the other.
To heal the wounds and prevent
recurrence we make sure IT has
a seat at the table during our
cross-functional team meetings
where we conduct process
analysis and redesign. I wish I
had a tape of all the discoveries
that occur: “Oh, is that what you
wanted?” “Heck, our current system can do this;” “I never
knew you needed this data,” and so on and so on.
Process should be interpreting
How should we be addressing the issue? If we parse out
organizations a bit more we see a sub-element nestled
between business and IT – process –
which is perfectly situated to interpret
between business-speak and tech-talk.
That’s the good news. The bad news is most
process people cut their teeth in production
process using production process techniques
– especially Lean Sigma and the elements
thereof – which has exposed them to
neither systems architecture issues
and opportunities nor the plethora
of automation software now available.
Process may be perfectly situated, but
it’s imperfectly skilled and still reliant on
production software approaches.
Getting to effective communication
Fortunately, forward thinking process
professionals are beginning to
practice new process approaches
that: design “outside-in,” from the customer perspective;
leverage systems architecture design and especially
automation software to deliver value to customers; and
consider business and technology an integral unit, with
practitioners required to be fluent in both disciplines – and
both languages.
This new approach to process fills the communication gap
and then some. But adopting relatively new approaches to
anything requires forward-thinking management. And the
communication gap will stay with us as long as we try to
attack today’s problems with legacy
process approaches designed for
manufacturing. Companies need to
start adopting the new, integrated
process/technology approaches
in their office and service settings
to finally close the business – IT
communication gap.
“I can see your lips moving, but all I hear is blah, blah, blah.
by Alicia Anderson
by Dick Lee
Bellwether Magazine | Second Quarter 201118
The Legality of Using Social Media In and Out of Work
Earlier this year, the National Labor Relations Board (NLRB)
filed a claim against American Medical in Connecticut
for violating federal laws that prohibit employers from
terminating employees for private communications. Similarly,
a Manhattan law firm has recently filed suit against J.P.
Morgan Chase alleging that they wrongfully terminated an
employee for writing novels and blogs under a pseudonym.
The firm claims that J.P. Morgan violated New York Labor
Law Section 201, which proscribes discrimination against
employees for engaging in lawful recreational activities
outside the workplace. The prior case was privately settled
so it is not quite sure if any precedents were set, however the
NLRB did make its position clear. Attorney Anthony Haller,
chair of the employment, benefits, and labor practice group
at the law firm Blank Rome in Philadelphia, points out that the
two mentioned cases are unique in that they involved activity
that occurred outside of the workplace, but further says that
companies generally and legally own all communications that
occur on their networks and that there is “no expectation of
privacy for the employee.” The moral of these cases is to
think twice before accessing any social media portal while
at work and although it may
be legal, to always use your
better judgment when posting
content outside of work.
Developing and Enforcing Your Company Social Media’s Policy
Social media (Web 2.0) is not a fad.
Its creation has changed incredibly the
way we communicate on a daily basis
and has provided new opportunities for
businesses to reach consumers. Because
of this, a company’s goals in developing
a social media policy should not be to
stifle its use, but to take advantage of
it while protecting company interest
and minimizing potential risk. Here
are a few Do’s and Don’ts to creating
a realistic social media policy:
by Cortez NaPue
Whether you use it or not, you’ve probably noticed a massive transition to social media and an increased need for employers to develop social
media policies. With this transition comes many complexities for businesses and their employees. Can an employee access their Twitter account while at work? Are employees allowed to comment about workplace environments on their Facebook pages? The answer is tricky, and employment law can often differ from state to state. The key for businesses in accommodating the constant evolution of social media use is to know both federal and state law regarding this kind of activity and to develop a commonsense company social media policy.
To Be or Not To Be...
SOCIAL
SOCIALNETWORKING
19bell•weth•er -noun: one who takes initiative or leadership
Create a policy that encourages the appropriate use of social media. Your employees are
usually your biggest evangelists and if allowed to speak organically, will often increase
positive recognition of your brand by others
Decide the overall purpose of your social media policy and how it relates to other
company policies. A social media policy can often be used to strengthen other
policies such as external/internal company communication and various human resource
policies
Be sure to be clear about social media use in the work place. Many companies’
policies refer broadly to using social media and often fail to differentiate
between work and personal use.
Make sure to refer to your company’s confidentiality agreement,
which often supersedes company communication policy.
While it may be ok to post things on Facebook or Twitter outside of
work, it is never ok to post trade or company secrets in any form of
communication.
When wording your social media policy be sure to
use non-restrictive terms that allow for the constant
changes in social media. You don’t want to be stuck with a
policy that becomes frequently outdated.
Do not develop a social media policy without first reviewing all federal and
state laws as they relate to your company’s location.
Do not discipline an employee for violating your company’s social
media policy until first consulting with an attorney. As social media is
consistently changing, so are the laws involving it.
Do not view private social media content without permission. Viewing
someone’s private profile (by method of hacking, coercion, password
theft, etc) without their expressed permission is not only a violation of privacy, it
can also open the door to a myriad of discrimination lawsuits as profiles usually contain
a massive amount of personal information
Do not develop policies that in any way prohibit an individual’s freedom of speech outside
of the workplace
Do not develop a social media policy that deters employees from or frightens employees into not using its
resources. Social media has quickly become an everyday part of many lives and reports indicate that companies
with restrictive social media policies are often struck with low employee morale.
DO’s
DO NOT’s
Bellwether Magazine | Second Quarter 201120
With annual losses estimated at over $20 billion, check fraud is a major problem impacting banks and their clients. The American Bankers As-sociation has stated that check fraud is growing at 25 percent per year. Fraudsters are continually looking for ways to outsmart “the system” and using new technology.
Check fraud is one of the fastest growing financial crimes in America. Check 21, a 2003 law that enables electronic processing of checks and conversion of paper documents to electronic images has made fraud detection more challenging. Checks still account for approximately 42% of all non-cash payment and are the single greatest source of payment losses.
Check fraud is also a recession proof growth industry. How does it happen? Maybe a business owner gets a call from his banker to ask about a questionable check being presented for payment at the bank, or an accountant notices that three checks in last month’s bank statement are all written to an unfamiliar person despite a realistic signature. A small business owner is notified she is overdrawn and realizes that a check originally written for $32.69 has been changed to $3,269.00, or after the layoff of their bookkeeper, the partners in a professional practice notice checks written on their account outside of their numeric range.
Fraud Prevention &
It’s human nature to have a tendency to file certain events under “won’t ever happen,” for example:
A real estate bubble | A giant oil spill | A break-in at your home or office | Fraud committed on your bank account
Obviously, these things CAN and DO happen.
Protection Starts with Basic Check Security FeaturesLayered features (combination of printed and resident in the paper) verify authenticity and make it more difficult to alter or reproduce. Look into using chemical sensitive paper, background patterns, warning borders, consecutive numbering, a padlock icon, micro printed borders, invisible fluorescent fibers, thermo chromic (heat-sensitive) ink, security warning box on back, or a security screen on back. Advanced features include foil holograms, toner adhesion, high security background patterns, high resolution border elements, chemical wash detection area, laid line backer, and true watermarks.
Partner with your Bank for the Highest Level of ProtectionPositive Pay is a service many banks offer. It consists of sending you an electronic file daily of checks that have come in to clear. They provide check number, date, and dollar amount. You can cross-check this against your records to verify legitimacy and immediately disallow any checks that don’t match your records. Positive pay can also provide your bank with accurate data of checks you plan to issue so that when presented for payment, they must match the information sent to the bank.
• Stolen checks • Forged signatures, • Identity theft • Alteration of “pay to” or “amount fields” • Counterfeit check stock • Erroneous “ship to” address
• Cashier check schemes• Check kiting, paperhanging • Dumpster diving • Phishing • Hacking • Skimming • Malware
• Scare ware • Phony orders • Bleaching • Scraping • Photocopying • Scanning and washing
Types of Check Fraud include:
Document Security
STATEOFTHEECONOMY
About the author: Karen Price has been a Safeguard distributor since 1982 and specializes in helping companies Manage. Grow. Succeed.® with simple, dependable business and promotional printing that supports your business needs. Her knowledge and experience help create effective results that make an impact for you. In addition to experience working with thousands of types of businesses over the last 25 years, as a long-time student of E-Myth principles and Kennedy-Glazer marketing strategies, Karen Price brings a unique perspective and wealth of information to her customers to partner with them in achieving their business goals.
by Karen Price
21bell•weth•er -noun: one who takes initiative or leadership
Fraud Prevention &Document Security
STATEOFTHEECONOMY
1. Burdensome 1099 requirement repealed
The Patient Protection and Affordable Care Act (i.e., Health Care Reform) included a very unpopular requirement that small
businesses file 1099s for all purchases over $600 – a rule that would have created many headaches for small business folks.
The February, 2011 repeal was supported by Republicans, Democrats, and anyone who runs a business, although legislators
are still working out the specifics.
2. New credits and deductions
Eligible businesses with fewer than 25 employees can receive tax credits for paying part of their employees’ health insurance
coverage. Self-employed business owners may also receive a deduction for health insurance costs.
3. States are in financial crisis
State tax revenues are in decline due to the recession. Lack of job
growth means this decline will likely be sustained through 2011.
Over 30 states have raised taxes in turn, some quite significantly,
and some are creating or raising new fees or assessments, some
targeted at businesses, to help with the shortfall. States may also
choose to up unemployment insurance rates to replenish funds
deleted by those without work.
4. Enforcement efforts are growing
Federal budget deficits mean the IRS is on the hunt for non-compliance
to boost revenues. Audits are focused on employment tax,
including executive compensation, employee status,
benefits, and other general tax specifications.
5. It’s complicated
Not surprisingly, tax changes come with many specific
rules and regulations, and detailed filing instructions.
Don’t go it alone. Good software programs are
inexpensive and help guide you through the process.
Your CPA is even more reliable and can help ensure you
file correctly and on-time.
5Five Things Small Businesses Need to Know about
Taxes in 2011
Five Things Small Businesses Need to Know about
Taxes in 2011by Alicia Anderson
Bellwether Magazine | Second Quarter 201122
For Spirit Airlines, an “ultra low-cost carrier” based in
Florida, fees represented 26.9 percent of its revenues.
Some of the more popular (with airlines, not consumers)
fees – and tips for avoiding them - include:
• In-person check-in fee - Online services are replacing
employees, so if you insist on checking in at the airport
in person, you’ll be paying their salaries. Check in online
whenever you can.
• Seat selection fee – If you want to choose an aisle,
window, or extra legroom, plan on paying roughly an extra
$20. Avoid this by being flexible about where you sit.
• Checked baggage fees - Delta charges $25 for the first
checked bag up to 50 pounds. For additional bags or
weight, additional fees apply. Travel light, or sign up for
the airline’s loyalty program. These programs are usually
free, and members get “benefits” like free baggage
checking.
• Credit card payment fees – It costs airlines money to
accept credit cards, but many will waive this fee if you pay
with an airline-branded card, like the Delta SkyMiles card.
This fee seems unavoidable, unless you think showing up
at the airport with a stack of cash is a good alternative.
• Comfort fees –Charges for blankets, pillows and food are
already in place. On JetBlue, and pillow and blanket set
will run you $7. Snacks and light meals can run up to $10,
though soft drinks are usually still free. Some airlines have
even considered charging a fee for restroom use. Bring
your own sweater, snacks, and empty bottle to fill at the
water fountain when you get through security. As for the
restroom fee…let’s just hope it doesn’t come to pass.
Those annoying baggage fees or change fees are one of the big reasons
that some airlines reported profitability in 2010. Airlines are desperate
to regain revenues in this time of high oil prices and a travelling public
used to cheap internet fares.
by Alicia Anderson
OUTSMARTAIRLINEFEES!Airline fees stink, but they aren’t going anywhere for a while, it seems.
STATEOFTHEECONOMY
23bell•weth•er -noun: one who takes initiative or leadership
by Alicia Anderson
Finding balance in all things is more of a mind-set than something you physically do. Peter Drucker wrote “Half a loaf is better than no bread”. I think we have a tendency to beat ourselves up about what we aren’t doing when we are doing something that we would rather not. We’ve got to ease up on ourselves and lower our anxiety levels. If you are always looking at the glass half empty, you will feel empty.
Try to catch yourself in the act, and change your behavior. Only you can make the change and look at your “loaf” as a gift. Finding work-life balance doesn’t have to be about spending more time on vacation or with your kids. It has more to do with finding the right balance inside you that allows you to free yourself from - well, yourself. Take time to enjoy your bread, no matter how much of it you have, even if it is only for a limited time per day.
“Half a loaf is better than no bread
WORKLIFEBALANCE
“The true value of a human being is determined primarily by how he has attained liberation from the self.”
Albert Einstein
Finding Balance
BLYTHECO
A Blog from Blytheco, LLC
LLC
5564 Hilliard Rome Office ParkHilliard, OH 43026877.462.5984
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