Archive for April, 2010

Effective Leaders know that People Come Before Profit

Thursday, April 29th, 2010

When you’re an owner or in charge of a company, there are so many individual issues to worry about—sometimes it’s a wonder you can think at all. Is it true that the most important thing to worry about is profit—for without it, you don’t have a business at all?

Focusing on profits blinds some managers and business owners to the real purpose of business, which is people. After all, no matter what business you are in, it exists to sell a product or service to people; it needs great people to keep it running smoothly, and having happy people as employees and customers makes it all worth doing.

A good team makes a manager’s job easier—but leading them effectively takes time and effort. And good leaders know that putting profits before employees is a recipe for disaster. No matter what size business you’re running, from a team of three to three hundred, you can’t reach goals and become a successful company by yourself. But how does a manger create a tight, efficient and effective team of employees?

Find the people who work best for you and with your other team members. Hire for skills, sure, but skills alone won’t make up for a lousy attitude. Passion and drive can’t be taught, so look for those attributes along with a stellar set of skills. Personality differences help make a stronger, more diverse team. But it’s not a good idea to bring polar opposite strong personalities into the same team. Knowing your team members well and hiring for compatibility will help ensure a winning team.

Don’t be afraid of conflict. Conflict helps employees sort out leadership roles, and move toward a tighter-fitting, focused group dynamic. But conflicts must be worked out or your teams will be completely ineffective.

Watch the rule-makers. Let your team leaders set the rules for the group—to a certain extent. Nobody wants a bully at work, but employees with natural leadership qualities will find ways to make the team work most efficiently. Working together pleasantly is a nice by-product of great leadership. If you start hearing complaints about rules that aren’t working for everyone, address them right away to avoid losing productivity.

When you have passionate, driven individuals, clear and focused leadership, and healthy doses of well-managed conflict, you have the beginnings of a great team of employees—and the potential for great profits, too!

When An Employee Isn’t Pulling His or Her Weight

Thursday, April 22nd, 2010

It’s an interesting saying, “not pulling your own weight.” But think about a team of horses, or oxen, or even sled dogs. Each one must contribute equally to the success of the team—or else the sled gets stuck in the snow, the field doesn’t get plowed, or the stagecoach takes a lot longer to reach its destination.

In an updated scenario, your business is the stagecoach, and success is your destination. If the entire team is pulling equal weight, you’ll get there together, faster. If even one employee is not pulling as hard, or putting in as much effort, it will take longer. And you might not ever reach the success your company is capable of.

So what does an employer do when one employee (we’ll call him “Joe”) is not doing his part?

First, don’t assume that Joe knows. Joe is not a mind reader. Even if his co-worker, Lucy, rolls her eyes each time Joe mentions he’s tired, or brags about how much he’s accomplished today, he could have no idea the rest of the team thinks he’s a slacker. You might think Joe is deliberately unproductive, while Joe thinks he’s a superstar.

Don’t wait. If it’s several months before Joe’s annual performance evaluation, don’t wait for that special day to bring him into your office and talk about his performance. It’s crucial to address a problem when it’s happening (or in this case, not happening), and ask for improvement right away. Especially if Joe’s teammates have complained to you about an unfair situation—you owe it to them to follow up and fix the problem. As boss, that’s your job.

Don’t accept excuses. Joe may have legitimate issues that are affecting his work performance. If so, call on your best leadership skills and help him through this rough spot—and if he’s a great worker, help him keep his job. But, if Joe is just really good at avoiding his workload, it’s only fair to the rest of the team to require improvement.

Choose a good time. If you’re under unusual stress, or the entire team is, due to a big project deadline, don’t escalate a potential problem. Wait until you can handle the conversation with Joe with clarity, keeping objectives in mind.

Acknowledge Joe’s strong points. Give a dose of good with the bad news. Focus on Joe’s strengths, appreciate his effort (such that it is) but let him know that other employees are doing more. Ask for Joe’s input on splitting the workload more fairly.

The best pre-employment screening process includes employee background checks, employee credit checks, and criminal background checks. You’ll know you’re hiring safe when you screen employees before offering a position.

Traits to Look for when Hiring Employees

Thursday, April 15th, 2010

Every business has different needs from its employees. A day-care center and a lawn-care service both have “care” in their names, but if the nanny is better with chrysanthemums than with kids, he or she is not going to fill the day care owner’s needs.

Still, there are plenty of basic traits employers like to see in their job applicants. We surveyed a few employers who are hiring right now about the most important qualities their new employees have. NO matter how smart, how educated, or how articulate a job-seeker is, remember this list when you’re hiring—because these are the qualities that really count!

Christine, a communications company owner, said, “First, I look for talent, then creativity. Everyone has a gift, and my job as an employer is to figure out how each employee’s talent can benefit my company. Creativity is absolutely essential. I can’t be the only one to solve problems. Having creative people around spurs ideas, growth, and helps us overcome challenges.”

Joseph, a construction company manager, looks for honesty and integrity, a positive attitude, and flexibility when he’s hiring new employees. “I know it’s difficult to judge these qualities through a job interview. That’s why we conduct background checks to make sure we’re hiring honest people. Past employers will tell me if a candidate has integrity. And asking the right questions reveals the person’s attitude and flexibility. These are traits that I cannot teach an employee—and I don’t have the time to deal with anyone’s bad attitude or rigidity.”

“I like to hire adults,” says Cynthia, a financial services HR manager. “Follow-through is important. Our supervisors don’t want employees who just don’t do what they say they’lll do. And who has time to follow-up to make sure they do their job? So, self-reliance and drive are two other qualities I definitely look for in a job candidate.”

To Kevin, owner of a small organic farm, three things are all that matter: “Passion. Confidence. And the desire to work. I can teach anyone how to do their job if they have those three attributes going for them.”

Heather owns a tech-services company. She says, “To me, adaptability is key. Things in our business change every day. Employees who are stuck in a rut or work only within the limits of their job description are just not going to succeed here. So, I don’t hire anyone without demonstrated adaptability. If they’re highly responsible and smile a lot, that also helps them when I’m deciding whom to hire.

If you’re an employer getting ready to hire again, keep these traits in mind, and see how they fit within your company’s needs and culture. Some qualities are just good for employees to have!

Preventing Employee Embezzlement

Wednesday, April 7th, 2010

Office Manager Pilfers $645,000 from Car Dealership

Finance Manager’s Theft Causes Interactive Business to Shut Down

Furniture Store Suffers $250,000 Loss through Bookkeeper

These headlines are real. Every single day, real employees steal loads of money from their employers. In the United States alone, the amount of property and cash stolen by employees adds up to nearly $1 trillion each year. Whether it’s done by taking property or cash out the door, or falsifying balance sheets, deposits, and checks, embezzlement is a huge problem for businesses.

Often, employees who are charged with embezzlement have a fiduciary relationship with the employer—they are in a position of trust, with access to bank accounts and financial records.

How do they do it? Some embezzlers set up relatives or themselves as phony vendors in the bookkeeping system, then pay phony invoices with real company checks. Others just write checks to themselves or pay their personal bills with company checks.

Embezzlers often start out with small amounts, gradually building up to larger sums when they don’t get caught. Others tell themselves they’ll take the money “just this once,” but find they are unable or unwilling to stop—even after the credit card is paid off, their child’s medical expenses are paid, or they buy themselves a new car.

The guilt felt by an embezzler is often replaced with justification that they are undervalued or underpaid, and therefore the company owes them the money they are stealing. Others feel no guilt whatsoever, and are simply stealing for their own financial gain. For some employees, opportunity is the only “license to steal” that they need.

So how does an employer remove opportunity from the equation—and prevent employee embezzlement?

Be diligent: Managers and owners must have their hands in the business. Know where records are kept, and review them regularly. Are bills or checks outstanding? Are invoices missing? Be an authorized signer on bank accounts, and review activity and statements online. Keep tabs on petty cash, deposit slips, and profit and loss statements.

Listen: Don’t discount when customers complain about double billing—it could be a sign that checks are being detoured to an employee’s account. And if employees report suspicious behavior among their ranks, deal with it immediately. Let employees know you trust them, and care about their job satisfaction. Nip bad attitudes in the bud.

Pay Attention: Employees who regularly offer to work overtime are either great to have, or a potential problem. But what about when the workload doesn’t require it? Staying late with no supervision—especially for an employee with access to cash and financial records—is something embezzlers do.  Embezzlers also spend money they don’t earn—so watch for signs of spending above salary should allow. Driving a new car, showing off expensive jewelry or bragging about trips and pricey restaurants are potential warnings.

Screen employees: Pre-employment background screening is critical to prevent fraud. But don’t stop there—occasional screening for established employees who have access to fiduciary information is also essential.

Employers don’t need to be paranoid about employee fraud. Reasonable safeguards and common sense supervision of employees is often all that is needed to prevent embezzlement. But even the sharpest managers have been fooled by embezzlers—and it can happen to any business.

How to Let an Employee Go

Thursday, April 1st, 2010

Up in the Air, the multi-Oscar-nominated 2009 film, features George Clooney as corporate “hit man” Ryan Bingham, whose purpose is to travel around the country and fire people.  Employers hire his company to do the dirty work of letting employees go.

At times, watching the film is painful. The director used real, recently-laid off people to portray Bingham’s victims—and their disappointment, sense of loss, anger, and disbelief are as palpable as Bingham’s cool detachment. He doesn’t know the people whose world he just rocked. Their responses to the news, like “I’ve given this company everything,” “What am I supposed to do now?” or “How can I go home and tell my wife I’ve been fired?” appear to have absolutely no affect on him.

Most employers occasionally have to let employees go. And most do it themselves. The full-scale layoffs depicted in Up in the Air are global corporations, shutting down entire divisions—not small businesses firing a single employee. While it might seem attractive to turn this unpleasant job over to a professional hatchet man, it’s just not possible for most employers.

Most supervisors and business owners say that firing people is one of the worst aspects of their job. So, how does an employer fire someone while treating them well and protecting the company from liability?

Here are some ideas you might consider:

  1. Don’t go it alone. A witness is necessary to protect your company from possible discrimination claims.  Have them document what happens.
  2. Allow enough time to gather all the necessary paperwork, such as evaluations, warnings and any company separation forms the employee will need to complete. Don’t make the employee squirm while you shuffle through a folder looking for something you need.
  3. Be completely professional. This means not getting personal. Don’t say “I’m sorry,” since that can confuse the issue. Your feelings and opinions should not come into the conversation. Keep your voice even, especially if the employee becomes agitated or raises his. And no matter what, don’t argue.
  4. Make it quick. Remember the advice about removing a bandage—the quicker, the better? It’s the same when telling an employee she’s laid off or fired. Just give her the bad news, stay calm, and listen to her reaction. Don’t place the blame on “the boss” or “corporate.” It’s easier to assuage your guilt by blaming others, but it’s confusing to the recipient.

Until your company is large enough to hire a professional, be prepared and be kind—but be professional—when laying off or firing your employees. Done correctly, it can have little effect on the organization. Done badly, it can be devastating to both employee and employer!