Business Education

My Best Employee Plans to Leave in the New Year, What can I Do?

The Great Resignation continues to unfold. At least, that’s what’s it’s been dubbed in the press to describe the phenomenon of a mass departure, largely regarded as due to the global pandemic shutdowns which caused a huge number of workers to rethink their career paths. So, an unprecedented amount of employees are leaving their current (or previous) positions, seeking out other opportunities. Couple this with the impending New Year and it makes for a particularly precarious employment environment. That means it’s quite possible, you’ll find yourself facing the same situation. Fortunately, there are preventative steps you can take to keep your best employee on board.

Biggest Mistakes to Avoid

Obviously, this will stir a number of negative feelings. You’ll likely feel angry, betrayed, baffled, and perhaps sad. These negative emotions cause people to act out in rash, impulsive ways. So, be sure to keep your emotions in check, which is to say in perspective, proportionate to the reality of the situation. If necessary, take a few minutes to step away from everything and allow yourself time to relax and clear your mind.

When your right-hand person or a rising rock star in your business tells you they’re about to leave, it can be an emotional experience, says Rich Reinecke, co-managing partner of business consulting firm Fahrenheit Advisors. ‘It can be very emotional, initially. Sometimes you’re angry. Sometimes you’re scared,’ he says. But what you do next can have serious repercussions for your business. —Fast Company.com

If you don’t act in a rational manner, proportionate to the circumstances, you will come unglued and that’s not helpful to anyone. Instead, keep your composure and act in your own best interest so you don’t hurt your chances of keeping your best employee from leaving. After all, he or she made this decision based on a number of factors and there’s probably a good reason why he or she came to this conclusion.

3 Effective Employee Retention Strategies

If your best employee tells you that he or she is leaving next year, you obviously don’t have much time to change his or her mind. However, that doesn’t mean their exit is inevitable. You might be able to get him or her to stay. Here are a few effective employee retention strategies you can use:

Have a meaningful conversation. Although money usually plays a significant role, more compensation isn’t always the driving force. There are instances when employees make completely lateral moves from one company to another and pay isn’t a factor. Of course, you’ll probably assume he or she will be paid more, but don’t convince yourself that’s the only reason. Take some time to have a one-on-one conversation and listen carefully to what he or she has to say. You might just find out there are other reasons for their decision to go and you can address those issues one by one.
Show your sincere appreciation. Perhaps your right hand is choosing to leave because they feel they have hit a ceiling and are stuck. This is a very common rationalization people use in order to convince themselves to leave their current positions. After you’ve spoken with him or her, be sure to take immediate action to show your appreciation. This can include but isn’t limited to: giving them more say about what’s going on, promoting the individual, or offering a few more persuasive perks.
Increase his or her financial incentive. obviously, money talks. And, if the main reason he or she is considering leaving, simply offer to match their new compensation package. If this strategy isn’t feasible right now, you can always do things like extra paid time off, or incremental, scheduled pay raises, or even offering more benefits.

What other methods would you suggest using to keep a key employee from leaving? Please share your thoughts and experiences so others can benefit from your unique perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.

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How to Get Past All the Hype about a New Business

September 7, 2018 No Comments

Samuel Langhorne Clemens, otherwise known by the pen name Mark Twain, once said, “There are three types of lies: lies, damn lies, and statistics.” Today, we’re past the sad story of Theranos and the fall of Elizabeth Holmes. But, Elon Musk and Tesla are filling the void. (As are a number of other brands and emerging technologies.) You can pick your favorite, because there are a number of these hyped or buzz generating entities out there. And, it’s precisely the attention and shine that fools so many people. This includes people looking for opportunities to go into business for themselves. So, how do you know if it’s legitimate or just hype? Why Hype often Falls Short Let’s begin with an important lesson. Buzz dies down and hype eventually wears off. But why? The question is more about a matter of time than some exotic explanation. The fact of the matter is, when an organization or a product is surrounded by hype, it’s usually due to an artificial yet real, phenomenon. In other words, some outrageous (or ingenious) marketing tactics work. People are awe-struck and want to believe. Fortunes were made on products using such hype marketing strategies. Many a consumer bought in to the sizzle once, never to be burned again by products that couldn’t possibly live up to the hype. The world’s a different place today, and consumers are far more demanding. The list of tactics that no longer work on today’s savvy consumers is long, and so is the list of things you can learn from the failures of hype-marketing tactics. —American Express OPEN Forum Although, we all know, reality will rear its presence, at some point. There comes a time when hype and buzz just can’t conceal the fact there’s not much there, there. When the dust settles, hindsight becomes 20/20. Now, sometimes, like in the case of Theranos and Elizabeth Holmes, it’s just investigative reporting. But other times, it’s just high expectations. Remember when the Segway concept first leaked to the public? It proclaimed the future of transportation. That fell way short. How to Get Past All the Hype about a New Business So, just how do you tell if a business idea or even a product or service is only hype? What are the telltale signs? Unfortunately, there’s no magic bullet. But, there are some things you can to do get past all the hype about a new business: Quick! Stop the press! Thomas Edison didn’t exactly invent much. In fact, he once said he’s more of a sponge than an inventor. He also used what’s known as the vaporware marketing tactic. Hearing a rival would soon introduce the first incandescent light bulb, he invited newspaper reports to see his, first. He brought them into a room, one-by-one. And, showed them a prototype. He’d then hurry them out just before it burned out. The same remains true today. You’ve got to look past the glowing press coverage. Look at the fundamentals. Speaking of looking past the media buzz, how about going a bit deeper and actually investigating the fundamentals. Is the company sound? Does it have a workable plan to grow? These and other questions will help you separate fact from fiction. If it sounds too good to be true… Okay, this is practically cliché. Or is it? Take a big step back. Take time to breathe. And, come back with a fresh disposition. If it sounds too good to be true, it probably is. But, it takes an objective look to cut through the buzz. What other ways do you spot hype? How do you look past the buzz and get to the real story? Please share your thoughts and experiences by commenting! Interested in learning more about business? Then just visit Waters Business Consulting Group.

How Businesses can Prepare for Inevitable Change

April 26, 2021 No Comments

Right now, the real estate market is super hot in many parts of the country. (But, totally cold in other sectors.) Currently, builders are experiencing huge disruption due to fast-rising material prices, especially lumber. Meanwhile, take-out restaurants are flourishing in some areas, while others barely hang on. This picture looks like chaos from a distance but it represents the manifestation of the old saying, “the only constant is change.” And, that’s always a threat — or blessing — to businesses. So, read on to learn more about how to prepare for inevitable change. The Change Conundrum When real estate prices rise steeply, people remodel their homes instead of buying. Others take advantage of the market and downsize to capitalize on their equity position. But, it also causes first-time homebuyers to stay out of the market until prices stabilize. When food prices rise, restaurants must make changes to their menus. Of course, higher food prices means fewer sales as people stay home and cook themselves. In today’s ever-changing and often-chaotic business environment, it is imperative for successful organizations to understand how to make change work when everything is changing. These massive changes now require a bold-new paradigm shift away from traditional approaches to how to manage change, to innovative approaches to view organizations as “organisms” with flexible resources, cohesive teams, connected networks, and clear flat structures that can endure in the most turbulent times. —Houston Business Journal The obvious point here is that when change occurs, some businesses benefit, while others suffer. Right now, the disruption caused by the pandemic and shutdowns, along with re-openings, are causing huge changes. The good news is that businesses that prepare can not only survive, but thrive. 3 Ways Businesses can Prepare for Inevitable Change Fortunately, the current environment won’t continue on forever. Lumber prices will fall, inflation will rise, and other economic circumstances will also change. Businesses that recognize what’s going on take action to adapt and can actually make it through or grow by doing the following: Accept reality. Lumber won’t always sell for the price it is now. Home prices will continue to rise, but not at such a rapid clip. Inflation won’t always be a significant factor. In other words, businesses can’t expect the present climate to go on and on and on forever. So, look at what’s on the horizon and don’t procrastinate. Instead, accept reality for what it brings and you’ll be able to cope much better. Plan for change. Once you accept what is changing (or will change in the future), it’s time to start planning to make it through the transition. Think strategically and prioritize what’s most important. This provides a great opportunity to streamline and improve operations. Alter operations incrementally. Speaking of operations, unless you fully expect things to change massively, don’t alter your way of doing business profoundly. Rather, make small, incremental changes to adopt to the changing times so you can always roll things back, if necessary. What other suggestions do you have? Please take a few minutes to comment and share your thoughts and experiences so others can benefit from your perspective. It just might help someone in a big way! Interested in learning more about business? Then just visit Waters Business Consulting Group.

Here’s What Small Business should Really Know about Retained Earnings

March 24, 2022 No Comments

The world has gone crazy. Well, it certainly seems that’s the case. Inflation continues to push up prices on just about everything. There’s a hot war in Europe that’s seriously impacting the free flow (and cost) of energy. All of this, not to mention an ongoing labor shortage, materials shortages, and plenty of other madness, wreaking havoc on day-to-day life. Of course, businesses aren’t immune to this madness — particularly small businesses. What this chaos does teach any entrepreneur or current business owner is the importance of retained earnings. But, what are retained earnings and how can small businesses build them up for difficult times that will inevitably unfold in the future? What are Retained Earnings Anyway? Retained earnings are an important part of any business. They are the funds that a company sets aside to cover expenses during tough times or to reinvest in the business. (Like now, when the entire world is topsy turvy and the economic circumstances are unstable and unpredictable, to say the least.) Retained earnings are an important concept in accounting. The term refers to the historical profits earned by a company, minus any dividends it paid in the past. The word “retained” captures the fact that because those earnings were not paid out to shareholders as dividends they were instead retained by the company. For this reason, retained earnings decrease when a company either loses money or pays dividends, and increase when new profits are created. —Investopedia.com During normal circumstances, retained earnings are generally used to expand. Examples include hiring additional employees, purchasing new equipment, bringing in new or more inventory to sell, or even acquiring new commercial property. But, when sales slow and the business isn’t earning enough, retained earnings can be used as savings to bridge the gap. How to Build Up a Business’ Retained Earnings One of the most important aspects of any business is its retained earnings. Retained earnings are funds that a company sets aside to cover expenses during tough times or to reinvest in the business. This money can be critical for businesses when they need to maintain cash flow during difficult periods or invest in new opportunities. There are two main ways to build up retained earnings. The first is to generate profits and reinvest them back into the business. This can be done by reinvesting profits into new products, expanding the business, or hiring new staff. The second way to build up retained earnings is to reduce expenses. This can be accomplished by cutting costs in areas such as marketing and/or overhead expenses. If you want your business to be prepared for anything, it is important to have a healthy retained earnings account. By reinvesting profits and reducing expenses, you can ensure that your company has the funds it needs to weather any storm. With a strong foundation of retained earnings, your business can thrive for years to come. Entrepreneurs should also Carefully Consider Retained Earnings if Buying an Existing Business When evaluating a company’s financial statement, it is important to look at the retained earnings line item. This number will tell you how much money a company has set aside to cover expenses during tough times or to reinvest in the business. If you are interested in investing in a company, it is important to make sure that its retained earnings account is healthy and growing. What else do you think new and existing business owners should know about retained earnings? Please share your own thoughts and experiences so others can better understand this important topic. Interested in learning more about business? Then just visit Waters Business Consulting Group.