What makes a company GREAT?

Great companies come from great leadership.  A great company's leadership NEVER forgets what it's like to be an employee.  After all, in the circle of life, whether we're Company Presidents, CEO's, Owners, Secretaries, Managers, Clerks, etc (you get the picture)...we all WORK to please someone else. 

A President/CEO of a company - big or small - works to gain the business of another.  That could be as vast as providing a service for another business or consumer, obtaining funding from an investor or lender, or striving to attain or keep key employees to make the company function.  All employees of a company work to keep the company viable, and feed their families and/or maintain their lifestyle. 

The difference in a GREAT company is that its leadership is more altruistic and benevolent. I read an article in the Daily News on Russell Simmon's new book, "Super Rich: A Guide to Having it All"* Russell Simmons states: "The true self already knows it is a servant. Look inside for results and not out. Look inside for inspiration and not outside. Accept that happiness is up to you and every choice that you make has to come from inside you. You have to be comfortable with it. Don't let your teachers tell you what to do. Note for yourself. If you sit still, you — as one individual — have the power to change your world. Take stock in the self. Operate from abundance, the number of people's lives you inspire by being a good giver." Unfortunately for Russell - NONE of his companies made the "TOP 100 Companies to Work for" list.  Russell should get back to the drawing board and spread some of his love and giving virtues to his employees.

Enterprenuers should emmulate the businesses from the 100 Best Companies to Work For -2010.  The top 5 are:

1. SAS.  One of the Best Companies for over 13 years, has a laundry list of benefits:  high quality child care at $410 a month, 90% coverage of the health insurance premium, unlimited sick days, a ), a free 66,000 square foot fitness center and natatorium, a lending library, and a summer camp for children, medical center staffed by four physicians and 10 nurse practitioners (at no cost to employees
   
   Jim Goodnight, SAS's Co-founder founded a culture based on "trust between our employees and the company"  is the only CEO that SAS has had in its 34-year history. Although SAS gave away loads of perks, SAS is highly profitable and ranks as the world’s largest privately owned software company. Turnover is the industry’s lowest at 2%.
2. Edward Jones.The investment adviser weathered the recession without closing one of its 12,615 offices or laying off a single employee (the British division was sold in October). Salaries were frozen, but profit sharing continued.
   Employee Perks: Telecommuting, 90% health coverage, Job Sharing program, Compressed work week, On site fitness center, subsidized gym membership, On site childcare, Paid Sabbaticals
3. Wegmans Food Markets.  Rated one of the best groceries in the nation, and a former No.  on the list, Wegmans has never had a layoff in its 94 year history.  More than 4,000 employees, 11% of the workforce has been here for more than 15 years.
   Employee Perks:  Job Sharing Program, Compressed work week, Telecommuting
4. Google.  The search engine king plans to add thousands of employees to its payroll in 2010. Though a few perks have been cut in recent years, Google last year increased 401(k) matching and added a stock-option exchange program to help employees with underwater options.  Engineers still get to devote 20% of their time to projects of their choosing.
   Employee Perks:  On site Childcare, Job Sharing Program, Telecommuting, On site Gym
5. Nugget Market.  The tough economy prompted the supermarket chain to help associates by giving them cards good for 10% discounts on $500 of groceries every month.  At one employee-appreciation event, the executive team surprised everyone by washing the cars of all associates.
   Employee Perks:  100% health care coverage

Being an Entrepreneur myself, I certainly plan to have my company encompass all the best traits of these companies - and even better surpass them!

*(http://www.nydailynews.com/lifestyle/2011/01/01/2011-01-01_russell_simmons_def_jam_records_cofounder_discusses_super_rich_a_guide_to_having.html)

How most businesses should start to avoid failure

The art of entrepenuership requires real creativity.  This is not just in whatever business venture you choose to start, but in every aspect, including how to live your life while you grow your business.  In my last blog I spoke about using creative self funding solutions.  This entails a few different methods.  All these methods require that you at a minimum gather between $10,000.00 and $20,000.00 on your own.  There's really no way around it, in this day and age, you can't sell a dream and expect everyone to jump on to your bandwagon.  You have to gather funds. We're going to refer to this as the "initial deposit on your future business" or IDFB. There are costs that you need to foot - no one else.  We'll go into depth on this in another blog topic, but you must be prepared to pay for business related costs. 

These factors have to be adhered to:

1. The best way to gather your initial capital is to work for someone else - in other words - have that dreaded job.  It's important.  You need to self sustain your living costs while saving money for your business venture. 
2. Important:  You need to lower your cost of living expenses to save for your business.  Think logically:  Given current economic conditions - whose job is secure?? Primarily the President/CEO/Business Owner of the company you're working for - not yours. 
3. Never give up your dream of owning your own business.  Keep your eye on the ball.  Whatever difficulties you are living in at the moment, remind yourself that they are short-term. Your goal is to make your business venture happen.  Don't let nay-sayers dissuade you.

Let's work on getting your IDFB.  There are various methods to raise your capital. 

• You can work and with your earnings save the money.
• You can gather friends and/or family and make them your partners/investors. (show good faith by depositing their money in a bank account, and give them the bank and account number information)
• Take the money from your 401K.
• If you're eligible to get a refund on your tax return, take that refund and add it to your IDFB. 

There's one thing that I will always advise NOT doing, and that's getting into debt initially to start your business.  Saving is essential to proper entrepeneurial ethics. It looks great on your Business Plan.  We'll address the need for a Business Plan in another topic.  If you need to get more capital to fund your business - NO ONE, I repeat, NO ONE will give you money if they haven't seen that you've sacrificed your own money for your business. 

Why is $10,000 to $20,000 the magic number you need to have?  Because you have to save 10% of what you will need in total to start your business. Most small businesses need $100K to $200K to start.  If you're business plan calls for more than that, you need to gather 10% to start.

Once you've attained your IDFB, then we can talk about how you can effectively make that money grow to self-fund your business.  There are very reputible businesses in the United States that will allow you to invest in their growth and get excellent returns.  We're going to explore in more detail, each one of those business opportunities you can profit from.  Keep tuned for our next blog.

The Importance of the business environment

Entrepreneurship is no joke.  It's akin to being a single parent with all the weight of the world on your shoulders.  Hiring employees certainly helps.  But we have to face it, our responsibility is not their responsibility.  In the hierarchy of business you should think along the lines of family structure. You - the Owner/President/CEO - are the Parent.  Your employee is your Child. Why use this strategy?  Because it works. 

Companies who do not relinquish the "I am your Master - You are my Slave" concept are doomed to fail.  Yes this is a tough economy, and people will take on any job including from companies using this condescending structure.   But in the short run, employees will leave.  Not to mention that companies employing this tactic usually have a high employee turn-over rate. The savvy investor will look at this as a huge financial risk. 

Companies who are ingrained in the old corporate whipping structure will not retain good employees nor create employee loyalty. Their management creates a fear-based environment. Every day an employee endures this hell denigrates their attitude towards their employer.  This in turn will slow the pace of the work, primarily because of the fear of possibly doing their work wrong, and eliminates the idea of job security in their mindset. 

What does this do for The Company?  It slows progress.  Uses up corporate dollars foolishly by training employees who will not stay long, and retards business operations because every time a trained employee leaves who has not been able to fulfill their duties to their full potential, a new employee who has to be trained must take their place.

Savvy investors should look carefully at a company's employee turnover rate.  If a company has a high employee turnover rate, the company's bottom line is affected negatively.  Corporate dollars are being mis-managed.  Not to mention that there usually are corporate egos to blame. A high attrition rate is directly related to a monetary leak in the company.  This makes The Company a bad investment.

There is no benefit to The Company.

So, to the Mindful Business Owner/President/CEO, it is imperative that you relate to your employees as you would to your family.  Obviously not as intimately, but as considering of their value.  Companies that have taken on the "family structure" and placed value on their employees flourish.  Potential employees clamour to get an interview.  Current employees value their position and are loyal.  Employees view this type of company as "looking after their needs".  A few such companies are Johnson & Johnson, and PaeTec Communications.  Johnson & Johnson is an established public entity in the corporate world. PaeTec Communications is a privately held telecommunications provider.  Both hold their employees and the family structure in high regard.  Both flourish and provide outstanding quality to their customers.  Both value their employees.  See the pattern?

So to the egotistical, hard nosed, demanding, rigid management of the corporate whipping structure - change is inevitable or your certain corporate demise is looming in the very near future.