August 26, 2019
Article of the Week
The Key to Happy Customers? Happy Employees
We all know that customers are central to the fate of businesses. It’s captured in the maxim, coined by department store tycoons of the early 20th century, “The customer is always right.” Jeff Bezos, one of today’s most iconic businessmen, has laid Amazon’s incredible success at the feet of its obsession with customers, saying “You can be competitor-focused, you can be product-focused, you can be technology-focused, you can be business-model-focused… But in my view, obsessive customer-focus is by far the most protective of Day 1 vitality.”
As company leaders strive to put customers first, our latest research offers new insights into how that might be achieved: through engaged and happy employees.
Glassdoor knows a lot about employee experience. Studying our database of millions of insights about jobs, salaries, company ratings and reviews, we’ve quantified the impact of worker satisfaction on retention, talent attraction, stock performance, and more.
In our new study we asked: Can companies help to achieve high customer satisfaction by investing in employees and ensuring that those who deliver goods and services are themselves satisfied with their jobs?
Our answer was clear: There is a strong statistical link between employee well-being reported on Glassdoor and customer satisfaction among a large sample of some of the largest companies today. A happier workforce is clearly associated with companies’ ability to deliver better customer satisfaction — particularly in industries with the closest contact between workers and customers, including retail, tourism, restaurants, health care, and financial services.
Linking Happy Employees to Happy Customers
To study this employee and customer satisfaction connection, we joined together two data sources: Glassdoor employee reviews and ratings from the American Customer Satisfaction Index (ACSI), which records the opinions of 300,000 U.S. customers on products and services. We looked at 293 large employers spanning 13 industries, including their average overall Glassdoor rating (on a scale of one to five) and ACSI score (on a scale of zero to 100) annually from 2008 to 2018. Using a standard panel model, we estimated the impact of the former on the latter, after carefully controlling for employer, year, and industry.
We found that each one-star improvement in a company’s Glassdoor rating corresponds to a 1.3-point out of 100 improvement in customer satisfaction scores — a statistically significant impact, which was more than twice as large in industries where employees interact closely and frequently with customers.
This finding is nearly identical to another recent study on the same topic, using similar data. Taken together, this growing body of research offers a powerful lesson to CEOs: If you want to build a customer-first strategy, building high employee morale is a necessary (though not sufficient) precondition.
While our observational data can’t prove causality — it’s possible having happy customers can boost employee satisfaction, rather than the opposite — we’re confident in our findings for several reasons. First, we see many examples in our data where employee satisfaction rises or falls first, followed by changes in customer satisfaction later; by contrast, examples of the reverse are rare. Second, the panel data examines changes in customer and employee satisfaction within the same firm, which addresses fears that the results are driven by differences between companies and their customers. Finally, even if our study shows happier employees are just a predictor of customer success, and not the main cause, that is still a useful indicator.
Industry Matters, But No Sector is Immune
One of our strongest findings is that there are some industries where employee and customer satisfaction are more correlated.
For example, in retail, food service, health care, and other industries where the two groups routinely interact, each one-star improvement in Glassdoor company rating predicted a 3.2-point increase in customer satisfaction. Sales associates, cashiers, baristas, and bank tellers are prime examples in our data of service workers that make up a significant portion of these employers’ labor pools and whose personal experience with company culture (either good or bad) is transmitted daily to customers. By contrast, our data show software engineers and warehouse staffers, who rarely work directly with customers, have little impact on their satisfaction. (You can explore our analysis yourself here.)
At the same time, even tech and manufacturing companies benefit from investing in employee satisfaction, among not only workers in customer-facing roles such as sales and support but also those behind the curtain. These organizations that have invested in a positive workplace cultures should also find ways to increase customer-employee interactions. For example, although Apple is a tech manufacturer, its brick-and-mortar retail locations expose millions of shoppers to its people daily, which benefits its brand image.
Companies that Hit the “Sweet Spot”
By studying more than a decade’s worth of data for hundreds of companies, we found several employers who stand out as being in the “sweet spot” with both high employee satisfaction (four-star or above Glassdoor rating) paired with high customer satisfaction (ACSI rating of 80 or above).
In travel and tourism, Southwest and Hilton top the list. Retailers like Costco and Trader Joe’s were in a similar position. This comes as little surprise, as the link between customer and employee satisfaction surfaces often in Glassdoor reviews for many of these companies. As one Trader Joe’s employee wrote, “you are encouraged to have fun with customers, answering product questions[…] Kindness to the customers is a big focus.”
High employee and customer satisfaction can be found outside of service industries, as well. Manufacturer Johnson & Johnson earns good marks in both areas, even though few of its workers are on the front lines. As one Johnson & Johnson employee review explains, “We are team players. We get things done. We serve our customers.”
Financial Benefits of Putting Employees First
In our study, we also give a ballpark estimate of how employee culture may impact corporate valuations through the channel of more satisfied customers.
A 2006 study published in the Journal of Marketing found that each 1% improvement in ACSI customer satisfaction scores for an employer was associated with a statistically significant 4.6% boost in its overall stock market value. Applying this to our findings, we can calculate the possible impact of a one-star improvement in Glassdoor employer ratings, given the expected knock-on improvement in customer satisfaction scores: an increase of 7.8% to 18.9% in long-term market valuation.
Becoming a customer-centric business is a worthwhile goal. But our research reminds business leaders that becoming more customer-oriented while allowing workplace morale to suffer is a poor and short-sighted strategy. Instead, customer and employee satisfaction should be seen as two sides of the same coin. Our past research shows what employers can do to improve worker engagement and well-being, while our new research shows those same strategies can also pay off in the form of happier customers.
August 19, 2019
Article of the Week
How to Create a Tight-Knit Company Culture That Can Scale With Your Business
Your company culture has been a key to your success, but how can you scale it the right way? Learn what we've seen work for businesses of all sizes.
When Tony Hsieh and I first started Delivering Happiness, we didn't anticipate the tipping point of what happiness means in work and life. Coming off of the book's success, I wanted to answer the demand for more happiness in company cultures around the world. In trying to scale ourselves and showing others how to do the same, we've learned a lot about what works and what doesn't.
It can be hard to create a culture blueprint that can scale alongside your business, but feel reassured: It's doable, because we've seen it done before. At first, you might have a successful, highly collaborative team, but things start to teeter off with the flow of new hires, even more so with the addition of new locations. As your business scales, here are four steps you can take to create a culture that is scalable, adaptable, and profitable too.
1. Define your ideal culture.
Whether your culture is already awesome or could use some fine-tuning, the only way to scale your culture is to capture what it is today and define what it should be. Company perks like meditation rooms or gym memberships are not the primary focus here. It starts with your company's purpose and values -- yes, those things that are often forgotten and left on a wall or plaque.
With every one of our successful clients, they've realized the need to create or refine values that speak more closely to their company's DNA. From there, they can dissect values into specific behaviors that everyone in the company can demonstrate. Examples of refined values and behaviors below:
Previous value: Relationships
Refined value: Create Meaningful Relationships
Behavior: Connect with your co-workers and customers with compassion and communicate consciously.
Previous value: Care
Refined value: Be Caring and Live the "Golden Rule"
Behavior: Act with appreciative inquiry in your interactions. Instead of asking someone who's having a bad day, "What's wrong with you?" ask, "Are you OK? Do you want to talk?"
2. Make an action plan and road map.
A 2013 survey from Towers Watson found that only about 25 percent of change initiatives succeed. How can you better avoid the pitfalls of the failing 75 percent? By driving commitment and making a plan.
If you want to implement any initiatives, there has to be an action plan (for those short-term next steps) and a road map for rolling out your culture to the rest of the organization. What are the most important things to celebrate and challenges to address? What are the projects that come out of this? Who will own them, who will support them, and what are the milestones in three months? It might seem like you're falling down a rabbit hole when you're looking at all of the problems, but it's digestible and doable when you take it step by step, stage by stage.
An example of an early road map initiative would be to get agreement on what your ideal company culture is. We always recommend an executive alignment session to get this foundation down first, but businesses with only a few leaders might be able to sync up on their own more easily.
3. Create a culture team.
Having a thriving and sustainable company culture requires ownership at every level -- from the leadership team to your frontliners. In your workplace already, there exist employees who are natural culture leaders (we call them culture champions or ambassadors). Take notice of who they might be. Yes, they can be people in your Human Resources or People Operations teams, but, just a head's up, there is probably an unofficial culture leader in every department you have.
With these culture teams, you can train them to facilitate your culture implementation in a localized way. Within these teams, some will be ambassadors while others will be actual facilitators who can train the rest of your employees on how to bring your ideal culture to life.
To scale culture successfully, you can't just rely on senior leadership or the founders to push it from the top down. Culture is co-owned by leadership and your on-the-ground culture teams to make sure it's bottom up, too.
4. Embrace subcultures.
As you roll out your culture strategy, expect that subcultures in your organization will arise to switch things up a bit. These subcultures might form as a response to differences in regional or work-related functions. For instance, it could be the cultural gap between the Shenzhen and the San Francisco office. Or it could be the delta between IT and Customer Service.
Though they may take on a different form, these subcultures are still in line with the foundation of your culture, so embrace them. Think of them as an adaptation needed to get full commitment from that department, location, and team. Even with the possible threat of toxic subcultures, your culture teams will have the tools and resources to help sustain alignment across the company.
Culture, like life (and happiness), is a journey. To think that you're scaling it now means you've created a business that serves a purpose for the world. So be intentional about how you scale. Without a plan, your business could go wayward and deviate from the ideal culture you've envisioned.
August 5, 2019
Article of the Week
Microsoft's CEO Knows How to Run a Meeting. Here's How He Does It.
"Ugh, another meeting. Can't I just get some work done?"
Who of us hasn't said that at one point or another? Researchers estimate that companies waste hundreds of billions of dollars in lost productivity due to poorly organized meetings.
On the other hand, if done right a 10-minute meeting can save dozens of emails, prevent major miscommunication, and even give birth to wonderful ideas and solutions.
This is why it pays to examine the meeting style of successful business leaders--like Microsoft CEO Satya Nadella.
When Nadella took over, Microsoft was in the midst of an identity crisis. The company was lethargic, plagued with infighting, and had lost its innovative edge. But in the years since, Nadella has conducted a stunning turnaround.
That's right. Satya Nadella made Microsoft cool again.
One way he did so was by transforming Microsoft's meeting culture. In an interview with The Wall Street Journal a few years ago, Nadella shared his three-rule method for better meetings, and it looks like this:
1. Listen more.
2. Talk less.
3. Be decisive when the time comes.
Nadella's advice may be only 10 words, but they're packed with emotional intelligence. Let's break down why this method is so brilliant.
When you listen, you learn.
Listening skills are invaluable for anyone running a meeting, because the whole reason you're together is to benefit from one another's viewpoints and perspectives. Additionally, listening to your team helps provide a psychologically safe, trusting environment--one in which they feel comfortable expressing their ideas, and sharing their problems (and even their mistakes).
All of this is valuable data that will help you guide not only your meeting, but also your team, in the most effective way possible.
Note that the key isn't "Don't talk." It's "talk less."
You can talk less by:
- asking more questions;
- being concise (not rambling);
- refusing to micromanage or solve every problem yourself;
- drawing out introverted or shy team members by asking for their opinion; and
- staying on time.
If you have the tendency to speak too much in a meeting, keep yourself under control by asking yourself three key questions:
- Does this need to be said?
- Does this need to be said by me?
- Does this need to be said by me, now?
There are definitely times when the answer to all three questions is yes--and by all means, speak. But if the answer is no, bite that tongue and you'll find that meetings are more effective.
Now that you've taken time to consider the thoughts and perspectives of your team, it's your job to move things forward. Remember, it's great to talk less and listen more, but that won't get you anywhere if you don't assign tasks and follow through.
Of course, not every decision you make will please everyone. But that's part of your job, too--to make the hard choices, commit to making them a success, and get everyone else to buy in, too.
So, the next time you're running a meeting, repeat these three tenets to yourself:
Be decisive when it counts.
Keeping Nadella's three principles in mind will help you stay balanced and productive, and make emotions work for you, instead of against you.
July 29, 2019
Article of the Week
4 Ways to Help Your Team Avoid Digital Distractions
In our always-on culture, employers expect workers to be reachable and responsive at all times. However, research shows that constant connectivity may be counterproductive when it comes to engagement and productivity levels.
Today’s smartphone users check their phones 150 times a day, which is the equivalent of spending 2.5 hours a day just opening and closing the phone. A single text message, which takes approximately 2.2 seconds to read, can double error rates on basic tasks; even worse, workers find that it takes an average of 11 minutes to get back into the flow of the previous task. Our phones have become compulsions, rather than tools of efficiency.
The long-term impact of distraction on productivity may very well outweigh the benefits of added efficiency. Former Google Design Ethicist Tristan Harris explains that we are battling an attention economy in which developers and advertisers are incentivized to hijack our attention. Their strategies are working. Today 26% of smartphone users are almost constantly online, checking their phones for messages, alerts, or calls — even when they don’t notice their phone ringing or vibrating.
To overcome, or at least counterbalance, the effects of the attention economy, employers can build upon proven practices for fostering a positive digital culture:
Create quiet spaces for mental recharging. Even the most gregarious extroverts need downtime to work. Designate a space for employees to step away from work and devices to just be and think. Whether you install nap pods like Google, meditation pods like Cigna, or just set aside a corner with comfy pillows, having space for downtime helps employees to activate their neural default mode network, which plays a crucial role in chunking information and connecting disparate ideas. According to a survey that I conducted in conjunction with Embassy Suites, Homewood Suites, and Home2 Suites by Hilton, 89% of people believe changing their work environment throughout the day gives them a positive boost. (Disclosure: I was a paid consultant on this study.)
Encourage phone-free breaks. Despite workers’ desire to get away from their devices, more than half turn to their smartphones during downtime, even though research shows that employees who take their phones on breaks feel less restored and less productive after returning to work. A 2019 study of more than 4,000 employees worldwide found that “less happy” workers are about 57% more likely to spend their lunch breaks using social media, whereas “happier” workers are about 275% more likely to take a leisurely lunch with friends. Further, a study of 450 workers in Korea found that individuals who took a short work break without their cell phones felt more vigor and less emotional exhaustion than individuals who toted their cell phones along with them on their breaks, regardless of whether they actually used the phone. For extra benefit, encourage employees to make the most of their breaks by practicing positive habits (journaling, writing down things they’re grateful for, meditating, doing a random act of kindness, moving around, or connecting with colleagues) that will refuel them for the day.
Set the social script for communication. Many employees feel compelled to respond immediately when an employer reaches out, even if communication comes after work, over the weekend, or even on vacation. Fifty-five percent of American workers reported checking their email after 11 PM; 44% of cell phone owners have slept with their phone next to their bed, because they wanted to make sure they didn’t miss any calls, text messages, or other updates during the night. Leaders can create a more positive digital culture for employees by explicitly setting the policy on when and how employees are expected to respond. Companies such as Deloitte are beginning to create “team charters” to document communication preferences and expectations.
Empower employees to block out focus time. Amid the constant din of meetings and emails, many employees feel that they lack the uninterrupted time to actually get their work done. Employees who get even 55 minutes of time to themselves report feeling more energized (56%), friendlier (53%), funnier (23%), and even smarter (22%). To empower employees to be their most productive selves, encourage them to block out chunks of “focus time” on their calendars. They can even set up a short-term auto-responder explaining what they are doing and when they will be back (“I’m stepping away from my email to finish this project. I’ll be back in one hour.”). This small gesture communicates a sense of respect to other team members, but also signals that they value doing good work.
By actively cultivating both mental and physical spaces within the workplace, employers can reduce distraction and drive long-term engagement. It’s time to give employees a (real) break and, by doing so, unlock the full potential of your workforce.
July 22, 2019
Article of the Week
How to Finally Unclutter Your To-Do List in 4 Easy Steps (From Inc.)
By Heather Wilde
When we try to multitask, we end up getting further behind. Here's how to achieve an uncluttered mind. If you're anything like me, you have a lot of responsibilities. Carrying all those responsibilities around in your head can be disconcerting, so you need to organize them somehow. Putting them all into on a to-do list frees up valuable mental space, because once a tedious task is on your list, you don't have to worry about it anymore.
This can quickly become disorganized-- especially if you are adding to it constantly-- so we generally come up with some sort of categorization system. At work, my team will mark things as "P1" (emergency) to "P5" (not important). As expected, the system is cluttered with P1s.
In his book Essentialism: The Disciplined Pursuit of Less, Greg Mckeown reminds us that priority means one thing. "Only in the 1900s did we pluralize the term and start talking about priorities." He adds that if we don't consciously choose where our time is best spent, others will do it for us. And soon, "we'll have lost sight of everything that is meaningful and important."
How can we tell what actually is important, though? Here are some tips to break through the noise and make better to-do lists:
1. Empty the trash.
Go through each task on your list, and ask yourself "Will this make my life easier or better in the future?", "Is this positively serving me?" and "Is this important?" If the answers are no, remove them from your list.
In a business or product context, you simply need to think about how the business will benefit from you completing the task. If you can't think of a positive reason, then it isn't worth your time.
Determine which tasks are really the most important (to yourself, your family or your business' wellbeing), and mark them from most to least important.
Realistically, you won't be able to deal with everything on your list quickly, so add the most urgent items to your calendar and to-do list and start a backlog for things you would like to do when you have time.
3. Automate whatever you can.
If you're already strapped for time and disorganized on top of that, it can be hard to find time to even create your lists. Not to worry, there are automated tools to help you.
Zapier has popular integrations with Gmail, Evernote, Google Sheets, Asana, and others, so if you get a text message, tweet, Facebook message, email, or anything you need to follow up on, you can just click a button and it will append it to your existing list.
4.Change your behaviors.
Whether your aim is to reach inbox zero, gain more time back in your day, or just be more organized, in order to keep your task list functioning properly you will need to create new habits.
One way to stay on top is to schedule your most important tasks for the time of day when you'll have the most energy. For example, a morning person may want to schedule all their sales calls in one solid block early in the day.
Over time, you'll notice that your once-cluttered task list will be replaced with only items that are valuable to you. And by getting organized, you'll reach your goals in no time.
July 15, 2019
Article of the Week
4 Ways To Make The Most Out Of Networking
We have all heard the saying, it's not what you know, it’s who you know. And considering that, 70% or more of jobs are never posted online, there is one superpower that will help you secure your dream job or build connections for the future: networking.
I am not saying to forget about your technical skill set (it counts!), but be aware of the value interpersonal skills plays in building a solid community.
As a career coach who helps clients find jobs, I am surprised to learn how many opt out of networking. I once had a client, we can call her Sarah, come to me for help with making a job transition from sales into marketing. When we discussed the ways she could look for jobs she went on about how exhausted she was by her intense job hunt, “I come home from work each night and search online for jobs to apply to. Honestly, the idea of going out and meeting people feels like a waste of time.”
Although applying for jobs online is a great start, Sarah was missing out on major opportunities in person. She just needed a little reminder and some guidance on how to make the most of her time at events.
There is a major difference between thinking you are productive by staying busy and actually being productive. Consider the Pareto principle, 80% of results come from 20% of your effort. Get very intentional about your time, it's valuable!
1. Search for the right networking event.
Be mindful about who you’re networking with. After all, if you’re looking for a role in sales, why attend a science panel discussion? Consider what it is you’re hoping to get out of networking and then start searching for the right event or community.
Hop online and browse networking sites such as Meetup.com or Eventbrite to see what upcoming events may be most aligned with your goals. If you still live in the area, your college or alumni class often hosts events where you already have a commonality with everyone in attendance. Not to mention, there are plenty of groups you can join and pay an annual membership to in return for admission to all events and meetings.
Don’t stop yourself there, local organizations and religious communities are often a good place to look for hosted events, and walking in with something already in common will make for easier conversation.
2. Don’t be all business.
When you arrive at the meeting, ditch the idea of passing out as many business cards as possible. Quantity is great; quality is better. Seek to create real authentic connections and build relationships that go deeper than simply asking “What do you do for work?”
We all know, no one wants to talk about work more than they already have to, so focus the conversation around common passions and hobbies to build a real relationship. Not only will this show your genuine interest in them as a person, but it will also make you more memorable to them.
Maya Angelou said, “People will forget what you said, people will forget what you did, but people will never forget how you made them feel.”
The next time you prepare to walk into a networking event, or any social gathering, remind yourself of this.
3. Speak to your transition, not your job search.
If, and when business does work its way into the conversation, be prepared to give a short and sweet overview in 20 seconds of your career path and future. You may be nervous about speaking to your needs, so practice first. Practice creates certainty, and certainty breeds confidence. Say your elevator pitch out loud a few times before you head into the event. This way, it is fresh in your mind and you won’t find yourself stumbling over your words on how to explain your goals.
Resist the urge to overemphasize your immediate need for a job and instead, focus the conversation on growth opportunities or the transition you are seeking to make.
4. Have a strong follow up after the event.
Once the event ends put time aside to recall who you spoke to and what you spoke about. When the conversations are fresh in your mind jot down a few notes. Don’t put this off! Studies show that people forget around 50% of what they learned within a single day. If they shared a business card, you can always make notes directly on their cards once you get home to help you remember.
Within a few days of the event, remember to follow up and reach out. Use your notes to reconnect on a personal level. Let's be real, no one wants to receive a generic email blast or an empty LinkedIn connection, so make it personal and reconnect over a shared commonality. This is a great opportunity to now follow-up with any future meetings or business discussions.
With these four tips in mind, Sarah set out to attend a few networking events focused around sales in her target industry. Not only did she make some solid business connections, but she met and built friendships with others in the same line of work.
Whether you are seeking a new job or not, stay proactive in your professional community and building relationships, you never know who you are going to meet, and where.
July 8, 2019
Article of the Week
The Most Overlooked Strategy For Business Development
There are plenty of good ways to feed your pipeline -- from public speaking to online advertising to content creation and direct mail. But one of the most satisfying methods of bringing in new business is through involvement in charitable causes. Too often, entrepreneurs think of charitable involvement as a non-essential “nice way to give back.” But in a busy world, it’s a lot easier to justify donating your time and talents if you recognize that it’s also a business development strategy.
In my new book Stand Out, I profile Thalia Tringo, a realtor in Somerville, Mass., just outside Boston. I got to know her when we served together on the board of East Somerville Main Streets, a civic improvement group. But that wasn’t the only cause she supported. She’s an active board member of the Somerville Homeless Coalition, and donates $250 to charity for every real estate transaction she completes. “I’m not a religious person,” she says, “but I try to tithe a percentage of my income. That’s hard to do when you’re a realtor [because of the variable income stream], so when I started, I decided I’d give a certain amount for every transaction, and that way I’ll know I’ll have done my giving.”
Her reputation for civic-mindedness has become a core part of her brand, and her client base draws on many people she’s met through her volunteering. “Today, I had a closing with somebody I would never have met, except we serve on the board of the Homeless Coalition together,” she told me. Her charitable involvement “was never really a marketing strategy,” she says. “It’s a good marketing strategy, but that wasn’t the intent.”
If you’d like to make charitable involvement a prong in your business development strategy, here are three key principles to follow.
Choose a cause you’re passionate about.
Volunteering isn’t always sexy, and you’ll likely be called upon to do menial or boring tasks sometimes, from setting up for events to making phone calls. Commitment to the cause can get you through, even if you wouldn’t otherwise choose to spend your nights and weekends doing those tasks.
Go deep, not wide.
It might seem like a good idea to get involved in many charities, because you’ll be meeting a large variety of people. But when it comes to developing new business contacts, deep is better than wide. I know plenty of realtors from social events around town, but I chose Thalia to handle my condo sale because of the depth of relationship we’d created by working together for several years.
Volunteer your talents.
Sometimes what’s needed most is simply a pair of hands; if you’re willing to pick up trash on a Saturday or check tickets at the door of a fundraiser that may be a valuable contribution to an organization. But in order to stay engaged and motivated over time, make an effort to volunteer on projects that will utilize your unique skills. If you’re a graphic designer, it’s far more meaningful to design a brochure for a charity -- a task where you can excel and share your gifts -- than it is to keep stuffing envelopes week after week.
Volunteering for nonprofits you believe in is a great way to help others. But it’s also a win-win, with real business benefits to you. If you can figure out how to live out your values in every aspect of your business, the relationships you build as a result will be among the strongest and best you have, because they’re founded on a shared commitment to something larger than yourself.
July 1, 2019
Article of the Week
Why Referrals Are The Most Valuable Form Of Marketing (And How To Get More)
Which marketing or sales tactic do you think has the highest ROI? Inbound marketing? Email campaigns? PPC ads?
The truth is this: there’s a standout winner that can’t be touched by any other method. That winner is referrals. Referral sales require almost no financial investment, but they bring in very valuable warm leads.
Unfortunately, most salespeople go about getting referrals all wrong. If you can improve the way your sales team asks for referrals, you’ll get big results without spending money on marketing or advertising.
We’ll talk about the best way to ask for referrals. But before we do that, let’s talk about why they’re so valuable in the first place.
Referrals Are Some Of The Most Valuable Leads You Can Get
Here are a few statistics from Social Media Today:
- 78% of B2B marketers say that referral programs generate good or excellent leads.
- 60% of marketers say that referral programs generate a high volume of leads.
- 54% say that referral programs have a lower cost-per-lead than other channels.
- Marketers rate referrals as the 2nd-highest source of quality leads.
Why the love for referrals?
Because there are two types of referrals, and both of them have significant advantages.
First, you can get a referral from a customer to one of their contacts in the same field.
That means your new prospect is highly qualified. They’re in the same industry, they probably have the same problems, and there’s a good chance that your product or service will be a good fit for them.
Second, you can get a referral from a customer to one of their friends.
Even if they’re in a different industry or situation, that referral comes with a lot of trust. That trust means is invaluable.
Most marketers and salespeople know—at least implicitly—that referrals are highly effective. They may not know that referrals drive some of the highest conversion rates among all marketing channels, but they know that getting them is important.
Unfortunately, most don’t know the right way to go about getting those valuable referrals.
Where Most Salespeople Go Wrong
Very few salespeople know how to ask for referrals. In my experience, they go about it in one of two ways.
First, they ask late. They wait until the customer relationship has been established for a while, and then they send out an email or bring it up on a call.
But there’s a big problem with this: if you wait too long, the customer is no longer excited about the product.
Even if they use it all the time, it’s not new anymore. That’s good for your business—you’ve become a regular part of their workflow—but not good for referrals.
You need to get to people while they’re excited about finding your company.
The second mistake that salespeople make is that they take “no” for an answer. Here’s how that conversation usually goes:
“Do you know anyone else who might be able to use our services? Anyone you work with, or anyone else in your industry, maybe?”
“Hm . . . I’ll have to think about that and get back to you.”
“Okay, sounds good! Looking forward to it.”
And that’s the last you’ll hear of it.
When you combine these two mistakes, you decimate your chances of getting a referral.
So how do you actually get more referrals?
There are four important steps:
1. Ask For Referrals Right Away
Let’s address the first problem: asking after the customer has been using the product or service for a while.
There’s a simple solution.
Ask right after you make the sale.
This is going to feel weird at first. But trust me—it works.
Right after the sale is when your customer is most excited about your product. They just decided that whatever you’re selling is worth their money. They’re completely convinced that what you do is valuable. And that’s the perfect time to ask for a referral.
It might sound something like this:
“Are you excited to start using our product?”
“Perfect! Who else do you know that would benefit from using it?”
This is more direct than you’re probably used to. But in my years of sales, I’ve found it to be the best way to approach the topic.
Of course, whenever you ask for a referral, there’s a good chance that your customer won’t give you anything useful. Here’s what to do about that:
2. Ask Twice
“Perfect! Who else do you know that would benefit from using it?”
It’s a salesperson’s worst nightmare. It’s awkward and you don’t get a referral. There are two things you need to do in this situation.
First, get over it. People are going to say “no” or “let me think about it” a lot. That’s just what happens. And that’s fine. They’ve already made the purchase, so you’ve succeeded. The referral is just the icing on the cake.
Second, ask again. You’ll feel weird about this, too. But in my experience, two out of every five people you ask twice will give you a referral. That adds up. It’s absolutely worth doing.
You might be wondering how you do this without sounding pushy. Here’s an example of what I’d say if a customer said they’d get back to me about a referral:
“I appreciate you giving it some thought! I’m sure you’ll have lots of recommendations for us in the future. But let’s just take one minute today to think of a friend that’s in a similar situation and could benefit from our product.”
It’s that simple.
Sometimes people will tell you “no” again. They might even be a little irritated. That’s okay. It happens. But a surprising number of people will give you a referral on the spot.
When they do, thank them and tell them that you want to make things easy. That’s our next step.
3. Include An Email Referral Template
Making a referral as easy as possible is just good business. Your customers are doing you a favor, so it’s important to help where you can.
One of the best ways you can do this is with an email referral template.
It might look something like this:
I wanted to connect you with Steli—his company, Close, built a sales CRM that uses email automation and predictive dialing to seriously increase sales teams’ productivity. I thought you might be interested in hearing more about it! I’ll let you two take it from here.
Send the email template to your customer, let them know that they can use it if they’d like (or write their own), and make sure to thank them for helping you out with a referral.
Some people will use your template. Others will write their own. It doesn’t really matter to you—as long as they put you in touch with a warm lead.
At this point, you might think you’re done. But there’s one step left:
4. Close The Loop
Getting one referral from a customer is nice. But getting multiple referrals is where you really start to get value from the process.
How do you get multiple referrals from a single customer?
By making sure your customers know that their referrals are appreciated. And not just by you—but also by the people they refer to you.
So when you make a sale to a referred lead, make sure to ask them to send an email to their referrer saying “thanks.”
It can be as simple as this:
“Hey, I remember that Jeff referred you to us. Would you mind sending him a quick email to say thanks? So he knows you appreciate it?”
You could provide a template for this step if you like, but most people will probably fire off a quick email without giving it too much thought.
It doesn’t seem like an important step. But it can make a big difference. When someone knows that referring their friends to you does good things not just for your company, but also for their friends, they’ll keep doing it.
Make Referrals Part Of Your Standard Practice
With these four steps, you can significantly increase the number of sales referrals you get. And as we saw before, those referrals are insanely valuable. But you need to make referrals part of your company DNA.
Make sure every salesperson is gunning for referrals after every sale. Keep following up with people to ask for referrals even if they say they can’t think of anyone at the moment. Show your thanks for people who refer new customers to you.
You might even consider instituting a referral program that offers rewards or discounts for referring friends (though I recommend waiting until someone asks for a referral discount).
Once you prioritize getting referrals and teach your salespeople how to make it happen, you’ll see big results. Build strong habits, and it will revolutionize your company.
June 24, 2019
Article of the Week
10 Ways to Strengthen Your Entrepreneurial Mind
Becoming a successful entrepreneur requires learning that goes beyond how to just run numbers and manage finances. As someone who has been an entrepreneur for more than a decade, I can tell you that while these elements certainly play a role, actually doing something significant with your particular business's numbers requires creativity, leadership ability and gumption.
These skills are obviously far less concrete than the ones you need for mathematics; nor are they learned the same way. Instead, strengthening an entrepreneurial mind requires lessons learned both inside and outside the classroom. So here are a few ways you can seek those lessons out:
Listen to experienced mentors.
One of the most practical things you can do is find a mentor --- or several -- and listen to what they say. Some of the most financially successful people in the world, likeMark Zuckerberg, credit their success to the experiences they shared with their mentors.
Mentors are great sounding boards for your ideas, so they can tell you what they believe is promising or what they foresee as being detrimental. You do not have to know them beforehand, either -- you can use resources like LinkedIn and SCORE to connect with people who have the experience to share.
Read as much as you can.
Besides mentors, you can acquire knowledge from published books and articles. People who write down their experiences and share them with the world want you to learn from their mistakes and successes, and they can provide real-world stories you can apply to your own venture.
For example, most successful CEOs revealed that they read at least a book per week.
Attend entrepreneurial events.
Want to be better at what you do?
Then surround yourself with other entrepreneurial minds at events like trade shows, conferences, webinars and more. Such events are excellent opportunities for networking, and having connections across industries will more likely set you up for success. Some of the top entrepreneurial events for networking include TechCrunch Disrupt, Startup Weekend and the 140 Character Conference.
From personal experience, I can credit my success to the time that I've spent at various entrepreneurial events. Keep in mind that your goal in attending them isn't to pitch what you're selling. Instead, it's to make professional connections that you can send leads to and receive leads from over many years to come.
Seek out new challenges.
The most important skill an entrepreneur can have is problem-solving. You need to learn how to think quickly, study situations from various angles and devise creative solutions no one else has tried before. To develop such skills, you’ll need to seek out challenging situations that help to wire your brain for critical thinking. For example, you’ll have to learn to accept feedback and criticism, listen earnestly to the thoughts and ideas of others and choose to focus on results and solutions.
Think about your vision every day.
You want to be an entrepreneur because you have an idea -- a vision. Think positively about your vision every day to remind yourself why you are cultivating these skills and putting yourself in stressful situations.
Give yourself a motivational boost when you need it; even U.S. Rep. Alexandria Ocasio-Cortez has said she recites a mantra to remind herself of her purpose and inspiration: “I am experienced enough to do this. I am knowledgeable enough to do this. I am prepared enough to do this. I am mature enough to do this. I am brave enough to do this.”
For me, I like to create digital vision boards and keep inspirational sticky notes in my office. It doesn't matter how big or small you go to make sure you see your vision daily; instead, just do something that works for you.
Over-deliver on your promises.
One way to distinguish yourself from the competition is to over-deliver on your promises. Are you a developer who promised to build a top-notch website for somebody? Include additional features that your client wasn't expecting. Not only will this habit improve your reputation, it will foster stronger customer relationships and encourage word-of-mouth marketing.
Try out every part of business.
While you are a solo entrepreneur, you have a lot of tasks on your plate. However, when your business grows and you have employees, it’s possible that you will forget just how difficult all of those responsibilities can be. To maintain your appreciation for everyone’s job and to avoid getting an ego, try your hand at every aspect of your business.
Work alongside your employees in different roles to see what their jobs are like --that will help you keep things in perspective, and provide opportunities to collaborate and bond as a team.
Being a successful entrepreneur requires discipline. You need to be careful about wasting time in both your professional and personal life. Limit the time you spend on social media, make sure you get plenty of sleep and eat balanced meals, schedule time for exercise and reading, and reduce distractions. One of the best ways to stay organized and disciplined is to try your hand at bullet journaling; many entrepreneurs find this pastime to be both productive and creative.
Listen more than you talk.
Always listen more than you talk; as they say, there’s a reason we have two ears but only one mouth. Especially when it comes to difficult or uncomfortable conversations, it’s best to focus on being present and really hearing what the other person is saying (not just verbally, but through body language and other social cues).
So often, we listen to respond instead of listening to hear what someone is trying to tell us. It’s always better to listen and reflect before responding to any situation.
Help other people.
In teaching, we learn just as much as we relay to others; and in that context, helping other people is one of the most fulfilling things we can do. Helping others with their entrepreneurial ventures can teach you a lot about your own business because it requires reflection.
Say, for example, that a business partner you work with is struggling with an unsuccessful social media campaign and you volunteer to help assess what’s going wrong. By comparing notes about your strategies, you’ll gain new insights into your own social media marketing and fresh ideas for new moves in the future.
Being an entrepreneur is not just about managing a business; it requires a new way of thinking. How will you strengthen your own entrepreneurial mind?
June 17, 2019
Article of the Week
Two Perks Employees Actually Want This Summer (and two they don't)
Employees often look forward to summer as the time to slow down and schedule some time away from work. For employers, however, the work must still get done, and summer’s dip in productivity can create a challenge. Making the season work for both employee and employer can mean compromise and communication.
“Recruitment and retention start with knowing what employees want,” says Michael Steinitz, senior executive director of Accountemps, a temporary accounting and financial staffing solution provider. “It’s important to listen to learn what motivates them the most without sacrificing productivity. It’s also important to know your market—especially what your competition is doing.”
What Employees Want.
In a recent survey, Accountemps asked employees, “What is the best summer perk companies could offer?”
Fifty-two percent said flexible scheduling, followed by 27% who would love to be able to leave early on Fridays. Flexible schedules align with several company policies, with 54% of senior managers saying they offer the perk, but just 32% of companies offer summer Friday hours.
What Companies Want.
Instead, 53% of companies cited a relaxed summer dress code as a perk they provide, and 48% noted a company picnic or potluck—two perks that employees care least about. Just 11% of employees said a relaxed dress code during the summer was their top priority. “A lot of companies already have a relaxed dress code,” says Steinitz. “Casual dress is less of a big deal.”
And holding a company picnic or potluck was bottom on the list of desirable summer employee perks, with just 10% of employees saying this would make them happy. “Employees want flexible schedules or reduced hours instead of an ice cream social,” says Steinitz.
Implementing Summer Perks.
If you decide to implement summer perks around schedules, sit down with different managers before you get too far into the season and set policies for the organization. Another option is to leave it up to each department depending on their needs.
Some companies mark the official start of summer as when the school year ends, while others create summer policies that run Memorial Day to Labor Day.
“Flexible summer hours will depend on what your company does and if you have peak hours that need to be covered,” says Steinitz. “One way to cover peak hours is by rotating schedules with certain people coming in later and staying later, and others coming in early and leaving early.”
Letting employees leave early on Friday might be a bigger hurdle to pass in some organizations, says Steinitz.
“It doesn’t surprise me that managers put leaving early on Friday further down on the list because it could mean fewer hours of production,” he says. “It’s also more of a change than some of the other summer perks that already exist in organizations. It’s easier to jump into something in existence, since it’s something that’s known and you have less adjustment.”
Steinitz says managers shouldn’t worry, though, as employees often compensate by increasing their focus, setting goals, and getting more work done in a shorter amount of time. Managers can also make it an ad hoc policy with parameters, such as certain tasks getting done or goals being hit.
Offering summer perks that workers actually want is smart business, as it can improve employee morale and make your company a more attractive place to work, says Steinitz. “These perks come at little cost to companies but often go a long way in keeping staff happy and engaged,” he says.
June 10, 2019
Article of the Week
How B2B Companies Can Win Back Customers They’ve Lost
Most research and training in sales focuses on acquiring customers, but, as ecosystems become increasingly dynamic and discontinuous, it’s also important to focus on winning back customers you’ve lost.
Reacquisition is especially important for B2B companies. Because of current trends— increase in the number and size of mergers, the variety of choice in global markets, and uncertainty about trade wars—customers are constantly re-evaluating their relationship with suppliers and making changes. Losing these customers is increasingly costly. As recently as 2014, for example, “the average publicly traded manufacturing firm received over 25% of its revenue from large buyers, up from 10% in the early 1980s.”
The process for reacquiring a customer requires a different approach than acquiring new ones. For one thing, your previous customers will have prior experience, knowledge, and long-held assumptions about your people and capabilities. Conversely, you have a basis for judging if that customer is worth pursuing.
In our study of 26 broken customer-supplier relationships, we found that companies that had successfully won back a customer followed a similar pattern. They identified the reasons for the initial dissolution, applied the right cost-benefit analysis, conducted an honest conversation with the customer, and accommodated their specific requirements.
To illustrate the process, we’ll use two companies, which we’ve disguised: Brex Tech and RILF. In 2009, Brex Tech, who supplied RILF with electronic components for its optical devices, lost RILF as a customer, but managed to win them back in 2012. Here’s how they did it.
Reasons for dissolution. The first step in the reacquisition process is to identify the reason why the relationship ended. Some buyer-supplier relationships have contractual end-points (e.g., projects scheduled for a specified period). Others may simply fade away due to a lack of attention. Pricing pressures, alteration of product specifications, or changes in ownership are also factors.
Your analysis needs to include who or what was responsible for the decision. It also needs to be ruthlessly descriptive, not prescriptive, focusing on what happened, not what should have happened.
In Brex Tech’s case, it had restructured, increased its prices, and laid-off key staff members. The CEO at RILF noted that “When their prices were raised by roughly 30%, we informed them about our concerns but they kept the increased price.” What started as a pricing issue then led to disputes and loss of trust between executives from both firms, which in turn generated more problems, and RILF lost interest in continuing to work with Brex Tech.
Cost-benefit analysis. All customers are not equal and not all relationships are worth re-establishing. Therefore, before you re-connect with a previous customer, weigh the costs of winning them back against the benefits.
Brex Tech did this in a few ways. After gleaning information from its previous transactions with RILF, including revenues, margins, and investments, Brex Tech’s CEO said that “RILF had accounted for more than 15% of turnover and we now had idle equipment in our plant that had been customized to manufacture products for RILF.”
Next, Brex Tech looked at both the economic and organizational requirements for re-establishing mutual trust and reliability. Brex Tech had a few things going in its favor. Since manufacturing and delivering high-quality products on time had never been an issue in their past relationship with RILF, Brex Tech managers believed they had a good case to make to RILF. After the break up and as part of its restructuring, moreover, Brex Tech was eventually able to increase factory productivity, which allowed it to decrease its prices without compromising quality or delivery times. The production head at Brex Tech noted: “We knew RILF was interested in three parameters: delivery reliability, quality, and price. If we could excel within these parameters, we could re-establish the relationship and make them switch back.”
Brex Tech knew it could offer RILF price reductions, better technical assistance than its current supplier in the relevant product categories, order-size flexibility, and other areas where the customer could quantify the benefits of a reactivated relationship.
Interactive dialogue. Though your business case may look good on paper, people are the ultimate deciders.
When Brex Tech re-initiated contact with RILF in 2012, the key players were different at both firms. This led to a time-consuming process. A Brex Tech executive noted, “The discussions with RILF started at the operational level, then meetings with middle management to move on with the process, and finally—because of the strategic importance of the products involved—with top management.” Similarly, a sales manager recalled, “We went through a period in which we met at least weekly with the customer. Management representatives were present but also engineers and technicians of the two companies.”
Knowing who does what, where, how and at what levels—the necessary rules of engagement–is imperative for successful reacquisition. For example, Brex Tech had discussions with employees that had been involved with RILF and with personnel not familiar with the account. While top management at both companies had been unable to reach an agreement, production personnel at both firms shared positive relations and unique know-how about products that RILF required. This was a key to reacquiring the account and underscores a repeated finding in management research and practice: people do business with people.
Accommodate specific requirements. When you are a supplier, the status-quo bias works in your favor. But when you seek to reacquire a customer, you must offer a better deal than the current supplier to motivate change.
RILF made it clear that Brex Tech would need to modify elements of its production processes, administrative routines, and IT systems—and provide special product designs while lowering price. But the information collected during the reactivation process also allowed Brex Tech to adjust and optimize its activities in these areas.
The resulting agreement justified the effort. Brex Tech’s sales and net profit from the re-established relationship with RILF were soon higher than in 2009. As Brex Tech’s CEO noted, “the fact that RILF purchases higher volumes compared to the past indicates the mutual value.” Moreover, the reacquisition helped to initiate positive word-of-mouth among other buyers in this market. Brex Tech gained two new customers as RILF recommended them to other companies. For RILF, meanwhile, more flexible and customized orders with Brex Tech increased its ability to sell and service in new segments.
In personal interactions, we often fear that others will judge us harshly and irrevocably if we make a mistake in pursuing a goal. But research indicates that, in many circumstances, correcting a past mistake generates a more positive impression (if the mistake is not repeated) than never making a mistake in the first place. The same is true in account relations.
June 3, 2019
Article of the Week
AI Is Within Reach for Small Business Marketing
Limited budgets have traditionally left small businesses at a disadvantage when looking to market themselves. Thanks to affordable artificial intelligence (AI) tools coming to the market -- everything from Adobe’s Marketo to Salesforce’s Pardot to our solution, LOCALiQ -- that’s all about to change. These tools are opening up new doors to advanced targeting and optimization that previously were reserved for larger organizations.
However, for startups and small businesses that also presents a new, rightfully intimidating learning curve. Artificial intelligence belongs in the realm of computer geniuses, right? Wrong. It belongs to you, the marketer. But where do you start and get up to speed?
The competition has never been more fierce for small businesses looking to stay alive. Amazon, for example, is looking to own everything from local grocery delivery to pharmaceuticals and household goods. Small-to-medium sized businesses (SMB), not working with a billion-dollar budget, can very quickly be eaten up and pushed out. The stakes couldn't be any higher to grow and retain customers -- in some cases existing customers represent 40 percent of revenue -- and AI is going to help level the marketing playing field.
Trial and error exercises in marketing are costly, and most small businesses can’t afford the risk of tactics that may or may not have the right impact on customers. Through the application of an affordable AI tool, marketers can tackle this uncertainty and benefit from recommendations for search, social and mobile advertising that are already optimized to provide the best results and drive traffic to best performing ad options. No more wasting money to “see if it works.”
Of a similar nature, AI allows for real-time competitive reporting that can help SMBs make recommendations on how to better compete in areas of weakness compared to other companies in the market. And, as any good marketer knows, customer satisfaction is paramount.
In fact, 76 percent of customers now report that it’s easier than ever to take their business elsewhere -- switching from brand to brand to find an experience that matches their expectations. With AI, smart client management tools become accessible to the SMB, increasing the usefulness of the data gathered on social, emails and calls by providing deeper insights into what customers and clients want and might need in the future.
How it all works
Big data and data intelligence have been buzzwords for years. Until recently, it has been difficult for any company that didn’t hire from a very limited pool of data scientists to take that data and actually do something with it.
AI solutions for marketers leverage big data to audit current traffic and ad performance to make real-time recommendations on the most valuable ads and strategies worth investing in.
What might take a marketing team days, weeks or even months to evaluate success and what worked or what didn’t work, AI can handle that same task in a matter of minutes. A smart AI platform will conduct predictive tests -- if X amount of budget goes in Y strategy, based on historical success, we’ll make Z amount of money. The machine learning working behind the scenes allows the system to simultaneously take into account each ad served and the resulting conversation (or lack thereof) to influence future decisions about where the ads should be placed, who should get the ads and what forms of advertising are resulting in the most conversation/leads.
The potential ROI
Implementing AI technology into the marketing process is intimidating, but at some point, it will be an inevitable undertaking. Companies that wait too long to embrace it will find themselves on the wrong side of profitable. The potential ROI from AI is just too great to resist for too long.
Especially as new tools becoming increasingly accessible, small businesses will be seeing some of the largest benefits. SMBs will save money by avoiding the wasted cost of failed marketing efforts like poor performing ads, lazy personalization, misunderstanding audiences and who needs what ad and the like. They will also save time, finally finding an efficient and cost-effective strategy to collect and analyze data from different solos and move quickly to make better decisions.
Until recently, large corporations have been the only teams in town with enough capital to take advantage of AI-driven marketing tools. However, as the price points have lowered and created a more approachable entry point for the SMBs to get in the game too, it won’t be long until more mom and pop shops and startups are feeling the benefits of this type of technology as well.
May 28, 2019
Article of the Week
How to Make Mindfulness Work at the Office
Research continues to show how mindfulness programs, whether through meditation, yoga, and even apps, can help people calm their mind and better manage stress. Top companies from Google to JPMorgan to Aetna, Inc. have taken notice and begun to implement them as a way to productivity.
For instance, after more than 13,000 Aetna employees took up yoga and meditation as part of the company's expanded wellness program, CEO Mark T. Bertolini, found that, on average, the group reported a 28 percent reduction in their stress levels. They also increased weekly production by an average of 62 minutes.
But mindfulness programs are more than just the bottom line. Implementing them into your business also teaches valuable leadership and management skills.
I recently caught up with three corporate mindfulness experts at the Wisdom 2.0 conference in San Francisco. Here is their advice on how to best launch and practice what you preach when rolling out a mindfulness program in your company.
1. Earn credibility
Always try your mindfulness program before it's introduced company-wide. "If you haven't practiced the program, you won't have much credibility," said David Treleaven, a leading corporate mindfulness expert and author of Trauma-Sensitive Mindfulness. "By experiencing the program yourself beforehand, you can offer valuable guidance and helpful tips to others."
Employees will also be more accepting when they know you find value in it. When I began yoga, I wasn't comfortable incorporating it into my business life or talking about it at work. However, when I opened up about it with my team, they began to ask questions and some even shared their experience with the practice. This created stronger work relationships and helped to strengthen my credibility about a topic some people were unfamiliar with.
2. Teach and educate
People often resist anything that appears like extra work. Yet, introducing a mindfulness program can be a teaching moment about how it benefits people's daily work.
Rich Fernandez, CEO of Search Inside Yourself Leadership Institute, who teaches business leaders how to incorporate mindfulness into the workday, suggests explaining how the program can help with challenging tasks, like conducting meetings, working with different personality types, and creating high-performing teams.
He equates it to how people can add extra exercise into their daily routine without feeling overwhelmed. "You can take the stairs or walk or bike to work and not feel as if you always have to make extra time for exercise," he said. In this way, your team can see mindfulness programs as something they need, and can easily add into the spaces within their day, rather than something they have to do or dedicate a significant amount of time to.
I have found some easy ways to create micro moments of mindfulness within the workday. For example, I shorten meetings by five minutes to allow everyone a mental break before moving to their next task. I also like to begin each meeting with a two-minute mini meditation to help everyone be more present.
3. Improve communication
"Energy follows intention," says Dr. Richard Strozzi, founder of the Strozzi Institute, an organization that offers blended leadership training programs based on neuroscience, action-oriented communication, conflict training, and martial arts.
Mindfulness programs can train you to better focus your energy and deal with stressful interactions in a more positive way. Strozzi says that it is "Through practice that we can train out attention and thus bring embodiment to our commitments."
For example, Strozzi suggests that when conversing with a customer or co-worker who cuts you off or keeps you from speaking, use mindfulness to center yourself, breathe, and then make a request or counter offer like, "I hear your point, but let me offer something else for consideration." This way you can change the energy and shape the conversation into something beneficial for both parties.
My approach in similar situations is to allow sufficient space before responding. I let the person know I understood what they had to say, and I will think it over and respond to in the next day or so. This way I can clear any negative emotions to ensure I see all sides of the situation whether it's a business problem or work relationship issue.
Mindfulness programs continue to help people manage stress and anxiety and more corporations have adopted them as a way to increase productivity. While there are many benefits to such programs, the process of implementing them into your business offers the chance to improve certain leadership skills. Mindfulness not only helps your business, but helps you run it better, too.
May 20, 2019
Article of the Week
What The Class of 2019 Wants From Employers
With the labor market tighter than dress trousers after the holidays, companies are trying to gain every advantage to attract the best talent. As a crop of newly degreed graduates looks for gainful employment, the companies that seek to hire them has a question: What does the class of 2019 want in an employer?
Fortunately, there is some new research to answer the question. LaSalle Network, a Chicago-based staffing agency, released a report aptly titled, “What the Class of 2019 Wants.” And some of the findings were surprising.
First, 35% of respondents said they’d go to work for any industry that hired them–the highest percentage in the four years the agency has done the report. Among those that are employed, 65% received between two and four job offers in 2019. They expect to earn between $51,000 and $60,000 per year in their first job out of college–and 89% will get that or more.
LaSalle CEO Tom Gimbel says these findings aren’t surprising, given the economy. “In a down economy, there is not going to be work-life balance, so the money is the driver,” he says. As jobs reports continue to show increases in available positions, people are going to look beyond money because they are secure that they can find another job that pays similarly or more.
But there are some indicators that generation-Z does approach prospective employers a bit differently. When they’re evaluating a job or company, there are several things that many want to see.
Gen-Z is looking for a great culture above all, according to the LaSalle report. They’re savvy enough to see beyond ping-pong tables and brightly colored walls and look for companies that invest in their people and offer a growth path. Among workers analyzing potential jobs, opportunity for growth was the No. 1 factor they considered, followed by work-life balance (up one spot from last year), and compensation (down one spot from last year). Seventy-six percent want a promotion within one to two years, versus 40% of millennials.
Kristin Mascolo, a dual public relations and entrepreneurship major at Syracuse University, is graduating with three job offers. Culture was a big factor in her search. “You ask yourself, Would you want to be with these people outside of work?” she says. But what led her to accept a job at a financial data firm was that she would enter into a rotational program, experiencing different jobs and departments in the company. “I would spend five months just learning before I even started my new job,” she says. Her firm also invests in employee education and certifications outside the firm, which was a priority for her.
They begin looking for that culture from the start, so a premier candidate experience is important, says Kim Hoffman, director of talent acquisition, products and technologies, at Intuit. “Gen Z-ers are digital natives. They grew up with information accessible to them; an instant, personalized experience is the norm. They expect this same experience from their employers,” she says. Hoffman adds that showing them how the company will invest in future growth is essential, even if it’s how they’ll grow from their internship experience to new college grad role.
True to form, Mascolo reached out cold to employees at the firms she was considering via LinkedIn. Those who seemed happy with their jobs and the company were happy to respond. Those who were reluctant to discuss their experience were also telling, but in a negative way.
PRAGMATISM BEYOND EXPERIENCE
Gen-Z workers came of age in the shadow of the Great Recession, and they want stability, says Jason Dorsey, president of The Center for Generational Kinetics, a global gen-Z speaking and research firm based in Austin. “Surprisingly, we’re even seeing them ask about things like benefits, including retirement, which is pretty unusual, given their overall age,” Dorsey says. LaSalle found that the top benefits they seek are medical coverage and a 401(k) match.
Those were two priorities for Mascolo. “I’m dedicated to starting my 401(k) early. I know one of the biggest complaints about millennials and gen-Z is that we don’t save for retirement. I didn’t want to fall into that bracket. I want to have a great 401(k) matching program and healthcare.”
Dorsey says these preferences may give bigger companies an edge in recruiting, but Gimbel says that this generation also wants access to executives, which could bode well for leaner firms. “The shine’s beginning to wane a little bit on the LinkedIns and the Googles, when they’re sitting there saying what those companies do now for their growth to hit revenue targets is to buy other high-growth companies,” he says. “The one thing you don’t get at a huge technology company is access to executive leadership.”
These workers also don’t want surprises about their performance–they want to know how they’re doing on a regular basis. “Gen-Z also wants a different relationship with their managers, often expecting immediate feedback and responses, as opposed to traditional methods like email, meetings, performance reviews, etc.,” Hoffman says. And they want to have a voice through vehicles like surveys, beta testing, and other ways to make difference.
Oh, and long commutes aren’t going to cut it. Proximity was a key factor in choosing a role, in LaSalle’s research.
MEANINGFUL WORK AT A COMPANY WITH IMPACT
“Gen-Z, similar to millennials, are global citizens. They will look for opportunities and companies that follow sustainable business practices, give back to their communities, and know how their work is making an impact,” Hoffman says. Intuit offers employees paid time off to volunteer in their community. As the most diverse generation in U.S. history, they also expect diverse and inclusive workplaces.
Dorsey says gen-Z wants an employer with a purpose beyond money. “And it’s not superficial, like just writing a cheque, or sponsoring some organization, but they actually have some goal that is to make the world, whether it’s in the local community, or somewhere else a better place,” he says.
Where can you find them? LaSalle found that gen-Z workers are looking at career fairs, their own networks, and job boards for employment, in that order. Sixty percent would take a temporary or temp-to-permanent position, up from 16% last year.
Attracting new workers entering the labor pool requires giving them a peek into their futures, especially how you can help them develop their skills and career. Companies that can give the class of 2019 what they want have an edge in landing the best talent.
May 13, 2019
Article of the Week
Top 10 Business Credit Terms Small Business Owners Should Know
As a small business owner, it is important to have an understanding of business credit terms. Similar to personal credit, business credit determines whether your company can be trusted by the way it manages money. Like personal credit, business credit is a reflection of how well your company manages money.
Why is business credit important?
The Nav American Dream Gap Survey, 2015 revealed of small business owners surveyed, 45% did not know they have a business credit score, 72% did not know where to find information on their business credit score and 82% didn’t know how to interpret their score.
The good news is that you don’t have to be a financial expert to negotiate the world of business credit. By knowing some key terms and definitions surrounding business credit, you can earn lenders’ trust and make your way to successful funding.
Here are the top ten business credit terms you should know:
1. Accounts Receivable – Also known as A/R, accounts receivable refers to the money owed to your business by others for products or services provided.
2. Business Credit Report – A business credit report is a detailed report of a company’s credit history prepared by a business credit reporting agency. The information contained in a business credit report provides crucial details needed to make informed credit decisions.
The data in a small business credit report is vital to getting the funding you need to successfully run and grow a business.
3. Business Credit Score – While a personal credit score is a number that represents an individuals credit history; a business credit score represents the credit risk of a business itself. Each business credit reporting agency has a different type of scoring model with scores ranging from 1-100.
4. Cash Flow – This is the cash that flows in and out of your business in a month. The cash coming into the business can come from customers & clients. Cash going out can be from expenses such as rent, payroll, taxes, etc.
5. Collateral – Any assets used to secure credit or a loan for the business is collateral and can be tangible or intangible. When you pledge an asset for collateral, it becomes subject to seizure by the lender if the business defaults on the terms.
6. Gross Profit – After deducting the costs it takes to make and sell your company’s products or services, the gross profit is the money that remains. The gross profit shows up on the company’s income statement.
7. Line of Credit – A line of credit for a business is an account opened with a bank, credit union or lender that lets you borrow money when needed, up to a preset borrowing limit. Each issuer has its own unique underwriting criteria, guidelines and terms.
8. Net Terms – This is a specific type of trade credit offered to businesses which require payment in full in a short period of time after a product or service is purchased. The typical net terms are net 30 and net 60 days.
9. Personal Guarantee - A personal guarantee is a written promise from a business owner to accept responsibility in the event the business fails to pay.
10. Profit & Loss Statement - The profit and loss statement (P&L), also known as the net income statement, shows if your company is making money, breaking even or operating at a loss.
Having access to business credit is the lifeline for a small business. It enables you to obtain the cash you need to grow, cover daily expenses, buy equipment & inventory, hire additional employees and so on. With a knowledge and application of business credit, you are well on your way to creating an important safety net for your business.
May 6, 2019
Article of the Week
How to Increase Productivity Without Giving Up Your Free Time
When you were in school, did you ever notice how some students needed a full week and weekend to prepare for an exam, while others could simply spend a few days and achieve the same outcome? As adults, do you find yourself leaving work at 5 p.m. on the dot, making everything look easy, while others are somehow never able to finish their workload and are constantly behind?
We all have the same hours in the day, yet how we prioritize our time and energy will dictate our ability to execute tasks efficiently. Working smarter is the ability to be productive and efficient when working toward your goals, rather than looking and feeling busy and out of time. Use your headspace to work smarter, and not harder, using the following perspectives:
THE PARETO PRINCIPLE
The Pareto Principle states that 80% of your results will be generated from 20% of your focused efforts. This was discovered when economist Vilfredo Pareto noticed that 20% of his garden peapods produced 80% of his peas. Translated into your own life, you could benefit from spending more time focusing on tasks that yield greater results, and less time on the things that don’t. For example, if you find yourself saying “yes” to every client or every project, consider only saying yes to some and focusing on the ones that bring you the highest ROI.
Set your intentions each day on activities that will produce the best results, and relentlessly focus and prioritize those tasks. Understand when you are most productive, and schedule your most difficult tasks around that time. Next time you find yourself working late, ask yourself, “Which 20% of my actions can contribute toward 80% of the end goal?“
REST AND RECHARGE
Working when you’re overly stressed and tired does not make you more productive, nor should it be a badge of honor.
Some of the most influential people of our time, like Apple’s Tim Cook and Microsoft’s Bill Gates, prioritize sleeping seven hours a night. Try and establish a sleep routine by going to bed and waking up every day at the same time. If you can give yourself enough time between working and sleeping, you’ll have an easier time turning your brain off and relaxing without any screens.
Afternoon naps are also a great way to boost your productivity throughout the day. A quick 20-minute power nap can help reduce your stress, increase your memory, decrease mental fatigue, and set you up for a successful afternoon when you’ve hit your post-lunch productivity slump.
If you find yourself feeling stressed out, remember to hit pause, and give yourself a time out. While a bit of stress can help light a fire, too much cortisol release in your brain can (and likely will) lead to reduced cognitive functioning, decreased performance, and a lack of productivity. Give yourself time to go on a walk, practice some deep breathing, and meditate.
ORGANIZE, ORGANIZE, ORGANIZE
If you’re staring at your to-do list and feeling overwhelmed, time-block your schedule and create hourly increments over the day where you focus only on certain tasks or project. By trying to do everything all at once, you lose focus. However, if you can give something your undivided attention, you’ll be able to break it down into more manageable parts, and have an easier time chipping away at your work.
The most productive people plan their work based on their top priorities and work accordingly around that. Creating a detailed to-do list each night will guide your plan of action throughout the following day. Don’t forget to always reward yourself when you complete and reach your milestones!
FOCUS ON YOUR OWN JOURNEY
Remember that what might take you five hours could take someone else eight. This does not mean you’re doing anything wrong, working less hard, or being lazy! Working longer hours does not ensure higher productivity. Give yourself the time you need to set and achieve your own goals, and don’t get psyched out by your colleague who can never seem to make it out of the office before 9 p.m.
Have the confidence to know that you’re doing exactly what needs to get done.
April 29, 2019
Article of the Week
4 Cash Flow Challenges Facing Small Business Owners Today
You should probably have a good handle on your company's cash flow, but do you ever wonder how your company compares with other small businesses? Intuit QuickBooks recently released a global study, the State of Small Business Cash Flow, which reveals the cash flow challenges experienced by small business owners and self-employed workers around the world. The study is also an in-depth assessment of the behaviors and attitudes of entrepreneurs experiencing cash flow challenges.
As I read the study, the section on cash flow issues faced by entrepreneurs caught my eye. According to the study, 69% of small business owners are kept up at night with concerns about cash flow. What drives cash flow issues for the self-employed? Let’s take a look at the top four factors.
1. Managing receivables
Receivables, for those unfamiliar with the term, is a balance of money due to a company. The business has provided services to a client or customer; however, the client still owes the company payment for those services. Until receivables are repaid in full, they are referred to as outstanding receivables.
One-third of all small business owners in the United States estimate their companies have more $20,000 in outstanding receivables, according to the study, and the average outstanding receivables for U.S. small businesses is $53,399.
2. Managing payments
How do small business owners manage payments? The study reveals 53% will send out invoices which bill customers and/or clients for services on a specific date. On the flip side of the coin, 47% of small business owners use advanced payment. This allows entrepreneurs to charge customers and/or clients for services before they receive them, or right when they do.
How long does it take money to process for small businesses? More time than you might think. Sixty-six percent of small business owners revealed the greatest impact on their company’s cash flow is the amount of time it takes money to process after receiving payments. Nearly one-third (31%) of small business owners say they wait more than 30 days for payments.
3. Employee management
Small business owners are not the only ones impacted by not receiving pay. A lack of readily available funds makes it difficult for entrepreneurs to pay employees on their payroll. More than two in five (43%) of small business owners with cash flow issues have been at risk of not being able to pay employees by their assigned payday.
Unfortunately, 32% of small business owners surveyed have paid their employees after their paydays. As illustrated by events like the partial government shutdown earlier this year, the impact late pay has on employees can be dire. Many individuals live paycheck to paycheck, and when a small business employer cannot pay on time, employees are likely to start looking for jobs at companies that can provide dependable pay.
4. Getting capital
What happens when it becomes too difficult to have liquid finances available? Some small business owners turn to loans and other forms of capital for financial support.
Getting financial support, though, isn’t always easy, and for some business owners this means admitting defeat before they have had a chance to try. Nearly two in five (39%) of U.S. small business owners don’t apply for loans, with 29% saying they don't apply because interest rates are too high, 23% do not want to make payments, and 19% do not think they will be approved.
How to resolve cash flow challenges
Sometimes I’m in a position to write an article in which I can offer actionable advice and help for small business owners. Cash flow is a slightly different matter. As noted by the study, it’s become an increasing problem for small businesses not to have funds readily available for real-time expenses.
While I am not a financial professional, I certainly don’t think it’s fair for small business owners to lose sleep worrying about cash flow. I recommend meeting with a accounting professional or a financial adviser to help sort out these concerns. These professionals will be able to get entrepreneurs on track with better billing practices, for example, that can be an asset to small businesses. Once companies and their owners are better equipped to resolve these issues, they will be able to keep relationships strong with employees, vendors, clients, and customers.
April 22, 2019
Article of the Week
Direct Mail is Hot Again. Here’s How to Use It.
By Rieva Lesonsky, SBA.gov
From Glossier to Quip, a variety of hip new companies is targeting millennials with...mailers? From postcards to catalogs, “hot, digitally savvy, direct-to-consumer” brands includingHarry’s, Wayfair, Rover, Quip, Away, Handy, and Modcloth have all started targeting customers via direct mail.
Here’s why direct mail is hot again and how your business can use it effectively.
Why Direct Mail Is Hot
Why is direct mail so hot? One reason is a higher trust factor. Younger consumers don’t associate direct mail with “junk mail” the way older consumers do. They’re more likely to attach that label to email.
Direct mail can be more effective. While direct mail and email marketing campaigns get similar response rates, a recent study found direct mail campaigns generate purchases five times larger than email campaigns. Combining email with direct mail led to the best results of all: purchases six times larger than email alone generated.
Direct mail stands out. Young people get hundreds of emails a day but only a few pieces of actual mail, notes one marketer quoted by Vox. In the same way digital-first companies such as Warby Parker and Glossier have begun opening physical stores to create a special experience, sending physical mail is a way to stand out from the crowd.
Direct mail is more shareable. Unlike email that goes to one person, physical mail goes to a household. RetailWire reports 88% of key purchase decisions for retail, financial and automotive categories are discussed at home, and direct mail pieces give recipients a reason to talk over the offer.
Direct mail has a longer lifespan. Email has a lifespan of just a few seconds, RetailWire reports, while direct mail’s average lifespan is 17 days.
Making Direct Mail Work
If you want to get started with direct mail, you have several options, including postcards, catalogs or catalog-like booklets. There are even group mailers that combine several companies’ offers in an envelope. (Vox cites one company, Share Local Media, that’s targeting millennial Brooklyn hipsters with the type of mailers their parents used to get full of ads for mini blinds or power washing services.)
The option you choose will be based on your budget (direct mail isn’t cheap) and your goals. Once you’ve made a decision:
Start with your existing customers. If your direct mail isn’t relevant to the recipient, it will hit the circular file. More than two-thirds (68%) of consumers immediately throw away mail from a brand or retailer they haven’t heard of. However, 76% will discuss mail from a brand or retailer they have purchased from in the past.
Target your mailings. Focus your mailings on people who have expressed interest either in your business or your category. Two-thirds of consumers will discuss mail from a brand or retailer they’ve never heard of if the category is of interest to them; 54% will discuss mail from a brand/retailer they have heard of, but not purchased from. You can target customer demographics using the USPS Every Door Direct Mail program, buy or rent mailing lists from companies like InfoUSA or DirectMail.com, or create your own house mailing lists.
Style it right. If you’re trying to attract millennial consumers, think of your direct mail pieces as physical Instagram posts. Keep the text brief, the layout streamlined and the photography eye-catching.
Make worthwhile offers. Email offers for discounts are a dime a dozen, clogging up the average millennial’s mailbox. But a glossy postcard or catalog with a special offer can catch the eye. Make it worth the customer’s while, not just a few dollars off.
Create landing pages for your direct mail. Three-fourths of people who use direct mail to make purchasing decisions also consult online sources for more information, so drive them where you want them to go. If you’re sending out a direct mail piece promoting a sale on your store’s athletic shoes, for instance, include a URL that goes to a landing page for that specific offer.
Don’t overload them. Direct mail is special precisely because your customers don’t get a lot of it. Carefully limit how often you send direct mail to avoid it becoming “spam” and eroding the recipient’s trust. For example, you could send direct mail with a special offer for a customer’s birthday, or after somebody makes their first purchase.
Combine direct mail with email. Media Post suggests starting with direct mail and following up a week later with email. It also recommends sending two emails for everyone piece of direct mail. You can make direct mail part of your automated marketing campaigns by setting up triggers to send direct mail after a prospect takes certain actions, just as you would with a drip email campaign. Both the email and the direct mail piece should use the same design elements and messaging to reinforce your brand and your offer.
Track results. Use landing page visits, coupon codes, and redemption rates to see how well your direct mail campaign is working.