May 2010

Why Businesses Fail

by admin on May 15, 2010

There are many different reasons business fail and much of it is debatable but there are some common mistakes that are detrimental in business failure.

Some of the reason many business fail are due to the following reasons:

? Overexpansion.

Many companies over expand too soon. They look at the books and see 3 months of good sales and profit and think right let's get more staff. Then another 6 months down the line the profits have not followed suit which leaves you in a difficult situation. You need to stick with realistic goals and allow yourself to grow as needs dictate. And old saying 'don't not run before you can walk' is relevant. You need to look at the statistics and watch for trends. If sales and profits looks good now it's doesn't necessarily mean it will look good tomorrow.

? Overspending and lack of reserve funds.

Overspending can have detrimental affects. You should only spend on what is necessary. Be realistic, just because you have good cash flow at the minute doesn't mean you will have in the future. Ask yourself is purchasing this item really necessary, will it make a real difference or not. Look at all the costs of the business and if some are not necessary then drop them. Having money in the bank is important to carry you through market downtrends and seasonal slowness. You should always be prepared for fluctuations in business. You should always put money away in boom times to prepare for the slow times.

? Poor management

Poor management is one of the main reasons business fail. If you haven't got happy customers and happy stuff your business is almost curtain to fail. Poor customer service, poor accounting and overall employee incompetence can all combine to collapse a business. You need to ensure your employees realise the importance of good customer service. Establish protocols for how tasks should be accomplished and ensure they are carried out. Many companies these days have a relaxed attitude and don't place to much importance on carrying out basic good management practice. Having meetings regularly with all staff will help your business run smoothly. If no meetings take place then resentment can set in. Everyone needs to air their opinions and explain how their job could be done more efficiently.

? Poorly treated Staff

Labour is the biggest expense for most small business so it makes sense to ensure your company employs the right amount of people and treat them correctly. Companies that invest highly in their staff by offering training and advancement will find it easier to keep their staff. Ensure you pay your staff every month on time as not to do so would be breaching your contract with them. Invest in your staff; they are your biggest asset. If they feel they cannot advance in your business they will not stay long. Listening to your staff is important. If employees are leaving you need to be asking why. Treat your staff how you would expect to be treated and you will gain respect from them and get the best of out them.

? Poor or no business plan

Having a good business plan is your key to success. A well-thought-out business plan forces you to think about the future and the challenges you'll face. As long as your forecasts are realistic and you have done plenty of market research you should be ok. Ensure your plan has a budget and stick to it.

? Dishonesty and Greed

Being dishonest will catch up with you eventually. Remember your ethics, try to treat your customers and staff as you would be expected to be treated. Don't charge the earth for customers just because they look like they can afford it, this is exploitation and will come back and bite you on the bum. Greed is another aspect that kills businesses. You feel like you're on a roll and feel invincible so you over charge people and promise them the earth. When you can't deliver you will lose customers and eventually your reputation. Always be honest and ethical and you will reap the rewards.

There are other reasons business fail and I have only touched base on some. As long as you work hard, do plenty of research, treat staff and customers with respect, keep a tight control over your accounts and leave your ego at home you should be alright. Oh and most importantly use common sense. You would be surprised at how many business owners are egotistic, arrogant with no personnel skills and very little common sense, these business are bound to fail eventually.

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Internet marketing is very different from the normal marketing. Normal marketing is like making a presence in the market by establishing a unit in your name in the desired market. But in case of internet marketing, the website has to take services from some good internet marketing Company and create a presence online amongst top rankers in search engine results.

Internet marketing company works via a team of SEO through on-page and off-page optimization of a website. Both these practices start after proper designing and lay-out of the website. The off-page optimization and the on-page optimization require regular working on the website on the daily basis and extract as many visitors through proper online search results.

Visitors type their keywords in the search engines and look for desired search engine results. Search engines show the top ten results for that keyword. It is evident that the website needs to be amongst top ten search engine results for related searches and get maximum business opportunities. Internet marketing Company or SEO Company gets the privilege to make your website rank high for best business opportunities.

Internet marketing Company chalks out a plan to make the website flourish. The plan includes various activities like article submission, directory submission, blog releases, PR networking and so on through search engine optimization. Internet marketing also includes link building where links are attached with related websites so that the visitor searching for specific product on other website gets in touch with desired website through links.

Apart from this; there are SMO activities also. This includes making the presence online through social networking sites. Email marketing is also a part of internet marketing. The idea is to make your presence so high that no visitor leaves the internet without noticing your website on the internet. SEO team enables a website to score high amongst top search engine results and earn good ROI through internet marketing.

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Thousands of children are terrified to go to school because of a bully.  Have you ever wondered what happened to the bully in your school?  Well, that schoolyard bully grew up, got a job, and is now a workplace bully.  She still uses threats, ridicule, and a negative disposition to terrorize those around her.  

Workplace bullying is aggressive or unreasonable behavior designed to negatively impact or destroy a coworker.  Workplace bullies can be managers, coworkers, subordinates and even clients.  Workplace bullies are insecure people who attempt to mask their insecurities with control and domination.  The target usually provides insight into the bully.  Bullies often target people they envy, people who have the traits and talents the bully wishes she possessed.  The bully attempts to destroy the more skilled and more talented individual to feel more secure in her employment.  According to the Workplace Bullying Institute, the following are the most common tactics used by workplace bullies:

Falsely criticizing the target’s work quality. Staring, glaring, nonverbally intimidating, and showing hostility. Discounting the targets thoughts or feelings. Sabotaging or interfering with the target’s ability to work. Ridiculing, undermining, screaming, and yelling at the target. Nitpicking and paying attention to unimportant details. Constantly reminding the target of mistakes. Threatening the target’s job, reputation, or work status. Abusing the evaluation process by lying about the target’s performance. Declaring the target “insubordinate” for failing to follow arbitrary commands. Assigning the target undesirable work as punishment. Creating unrealistic deadlines, duties, and work demands. Encouraging the target to quit or transfer or face more mistreatment. Ensuring failure of the target’s project by not performing required tasks, such as sign-offs, taking calls, working with collaborators.
 

Many employees do not report the workplace bully for fear that the behavior will worsen or they will lose their jobs.  But, ignoring the behavior will not solve the problem.  “Bullies don’t reform  - ever,” says Bruce Taylor, owner and principle of Unison Coaching.  “They may hide the bullying for a while, or they move on to another victim, but they won’t stop bullying.”  Bullies enjoy bullying.  Bullying is a personality trait which the bully has sharpened for years.  It is her way of life now.  The workplace bullying usually does not stop until the targeted employee resigns or is terminated.  Gary Namie, a psychology professor at Western Washington University, says that “once the bullying starts, most can only stay 16.5 months because it costs them their health.”  You can handle workplace bullying in the following ways:

1.  You must perform your job well and make sure that others know you are performing your job well.  Workplace bullying takes a tremendous emotional toll on the target.  If that emotional toll causes your performance to deteriorate, then the bully’s baseless accusations of poor performance can turn into warranted accusations of poor performance.  You cannot defeat a workplace bully if you are not performing your job well.  

2.  You should not internalize the bully’s attacks.  Workplace bullies constantly criticize, ridicule, and disparage their target.  That can beat the target down and cause the target to believe that the bully’s negative statements are true.  The target must reject those lies. 

3.  You should gather your witnesses, coworkers, and friends for your defense.  It is fantastic if you have individuals who can support your allegations.  However, since 72% of bullies are bosses, there may not be anyone who will support you.  Coworkers are rarely willing to take a stand against a boss, especially a bully boss.

4.  You should avoid private interactions with the bully.  Some bullies recognize that their behavior is inappropriate and refrain from treating you badly in front of others.  If your workplace bully only mistreats you in private then avoid private interactions.  Also, there will be witnesses who can attest to the bully’s behavior if the interactions are not private. 

5.  You should document the bully’s behavior.  Your allegations will be taken more seriously when they are presented factually and not emotionally.  You remove your allegations from the emotional realm when you approach your employer with fully documented facts, i.e., names, dates, witnesses, and details.

6.  You should consider filing an internal complaint against the bully.  You need to make someone else in your company aware of how you are being treated.  You should make the complaint to Human Resources, a high ranking company official, or someone identified in the company’s complaint procedure.

7.  You should consider looking for a new job.  Workplace bullying typically ends with the employee’s resignation or termination.  According to the Workplace Bullying Institute, “more than 80 percent of those bullied lose their jobs.”  You should consider looking for a job so that you can leave on your terms.

8.  You should consider filing an external complaint against your employer and/or the bully.  Sixty-two percent of employers ignore complaints of workplace bullying.  That means that your help will likely come from an individual or entity outside of your company.    

Workplace bullying is four times more prevalent than illegal harassment.  Yet, employers ignore most complaints of workplace bullying, telling the victim to “work it out” with the bully.  The employers who react in that way do not appreciate the financial cost of workplace bullying and are relying on the fact that workplace bullying is not illegal.  There are 16 States that are considering “healthy workplace” laws prohibiting workplace bullying but, to date, no State has made workplace bullying illegal.  So, you should avoid describing your situation as workplace bullying.  Instead, you should use terms the law recognizes such as harassment, discrimination, and hostile work environment.  If your physical characteristics or those of your harasser make it difficult for you to make a viable harassment, discrimination, or hostile work environment claim then you should talk in terms of torts such as assault, intentional infliction of emotional distress, and tortious interference with employment.  The Indiana Supreme Court recently decided Raess v. Doescher, a case many are calling the first workplace bullying case.  In the Raess case, Joseph Doescher sued a surgeon who treated him poorly at work.  The Indiana Supreme Court stated in its written opinion that “workplace bullying could be considered a form of intentional infliction of emotional distress.”  And, the jury awarded Doescher $325,000 on his assault claim.  There are legal causes of action which reach workplace bullying.  You should use those legal terms and not “workplace bullying” when speaking to your employer.

Legal risk is not the only risk workplace bullying poses to companies.  Workplace bullying presents significant financial costs to companies with respect to productivity, operating cost, and work quality.  A University of North Carolina workplace bullying study found that 28% of targets lost work time avoiding the bully, 22% of targets decreased their work effort, and 12% of targets changed jobs to avoid the bully.  Health care costs also rise as the target’s stress becomes a sickness or illness that requires medical treatment, sick leave, or FMLA leave.  If the targeted employee resigns or is terminated, the company will incur significant costs in hiring and training a replacement and loss of company wisdom and experience.  Human resources experts estimate that replacing an employee costs a company two to three times the lost employee’s salary.  There is also the time and expense of handling internal employee complaints about the behavior.  So, you should not discuss emotions or moral impropriety when you complain about workplace bullying.  You should speak a language your employer will pay attention to and understand . . . legal and financial risk. 

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Why Even Worry About It?

You put a lot of time, money and sweat into your business. After years of effort, you have it fine-tuned and are making a nice living. How willing are you to lose your business?

Consider the following hypothetical situation involving two sole proprietors. Our first party, Programmer, creates computer programs for managing websites. The second party is Mark, the owner of a site that provides small businesses with websites. Programmer and Mark come to the conclusion that they can make big money by opening a joint site. This type of situation occurs every day on the Internet. How should they do it?

The best option is to form a corporation or LLC. Each party will own an agreed upon percentage of the company. Mark will contribute his marketing ability while Programmer contributes software platforms. The bylaws [administrative rules] of the corporation will detail how profits are divided as well as detailing who gets what [domain name, client list] if the relationship doesn’t work out. If a corporation or LLC is not formed, each party exposes their individual businesses to liability just as would occur in a general partnership.

What has been accomplished? Mark and Programmer are protected from liability arising from the new business. If the company fails or is sued because of problems with the software, Mark and Programmer will avoid personal liability and their original businesses are not touched. Are they completely protected? NO!

Mark and Programmer are still open to liability on the "back end". Without realizing it, each trusts the other to properly run their independent businesses. Why is this?

Assume that Mark and Programmer follow the above plan and the business is very profitable. One day, Programmer is served with a lawsuit claiming that he violated copyright laws with a program that he developed before meeting Mark. The nine companies to which he sold the program also sue him. The trial goes badly and Programmer is found liable to the tune of $750,000.

Guess what happens next? Since he is a sole proprietor, Programmer's interest in the joint business with Mark is seized to satisfy the judgment. Alternatively, he files personal bankruptcy. Either way, Mark is involuntarily going to have a new business partner that probably can’t program! In short, we are talking about a disaster.

How To Protect Yourself

Business entities are the key to limiting your exposure to liability. In the above situation, Mark and Programmer should own the joint company as individuals, but they should form business entities for their personal businesses. If the personal businesses are sued, their individual ownership of the joint venture entity is shielded from attachment.

As a general rule, you should form an individual business entity for each business you own. By doing so, you are better able to limit the potential damage of a lawsuit involving one of the businesses.

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I've found there are lots of people in a long standing business partnership who are not satisfied with the status of the relationship. They may feel stuck, frustrated, angry...or all of these. They know they've been silent far too long, but just don't know what to do.

What can cause such a change in a relationship that started out with high hopes and good feelings?

Here are some of the situations I see most often. Do any of these apply to your partnership?

One partner feels like he's carrying the bulk of the workload.

This may have happened because there wasn't an agreement about who would do what. Job roles, responsibilities and accountability have not been discussed.

Expectations are not being met.

Expectations may be quite different for each partner. When expectations aren't met, it's a set up for negative feelings. It's important that each partner knows what to expect from the others.

Partner has lost interest in the business or changed thinking.

Over time new attractions and options will continue to present themselves to all partners. When a partner becomes disenchanted with how the partnership is going, she is more likely to lose interest over time.

Can't talk to each other.

Communication is so critical to maintaining a viable partnership. When partners get so busy doing their own thing that they can't find time to sit down with the other(s), they will likely start to feel less engaged. An unresolved issue can also lead to partners being unable to talk about certain things.

It's a wrong partnership.

Sometimes the partnership has been a bad match from the beginning, but it was maintained for a variety of reasons. When the primary reason for the partnership was based on personal needs more than on business needs, if those needs aren't fulfilled, the partnership will flounder. Maybe one partner thinks and acts fast and the other wants to research things in great detail. These people may never be able to function well together. Basic behaviors and traits will not likely change even if the person tries.

Are any of these your concern? How do you open the subject of improving the relationship for the good of the company? NOTE: Even if you think it may be a wrong partnership, it's worth making the effort to see if it's salvageable.

Be proactive.

If you want things to change, it's up to you to change them. Make the decision you're going to break the status quo, but you're going to do it strategically.

Be clear about what you want.

Start by thinking about what you want for yourself and the business. NOTE: Use the Partner Questionnaire to help you organize your thinking. You can ask your partner(s) to do the same and compare notes or you can determine what you think will work and present it to your partner for feedback.

Schedule time to talk business.

Once you have thought things through it's time to schedule a time to talk business. Give your partner plenty of lead time and full disclosure about what the meeting is about. Let him get prepared for the meeting, but don't let it be put off because he "doesn't have time".

Discuss actions you're each willing to take.

Be prepared with actions you are willing to take. You can request or suggest actions from your partner, but leave the topic open for discussion and agreement.

Write a PLAN for agreed upon changes.

Once you reach agreement, set Goals for yourselves and the business. To keep things moving in the right direction it's a good idea to schedule periodic meetings to iron out details. This is the perfect time to start the habit of regular planned communications.

Set a timeframe for evaluation.

Three months is a reasonable timeframe to see if the Plan is achieving the results you want. Schedule an actual time where you will sit down together to see what has been accomplished toward the Goals you set. If you see progress, you may want to give it another three months.

If your evaluation tells you there is no hope, it may be time to make that very difficult decision to end the relationship. If you can't come to agreement or you're clearly going in different directions, it's probably time to part ways. Why waste any more time on a losing proposition?

Yes, it's like breaking up a marriage. But sometimes it has to be. Rather than feeling defeated, congratulate yourself on gaining the freedom to move on to something better.

Take a good look at your partnership and decide if it's time to take action. Start by downloading the Partner Questionnaire at www.primestrategies.com/partnerquestion, answering the questions yourself and then asking your partner(s) to do the same. Then plan to sit together and review your answers. It's a great way to get the dialogue started.

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Partnership Pitfalls

by admin on May 9, 2010

If you are considering entering a business partnership my first advice is don't do it. However if you need a partner watch this video.

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There are successful people who experienced a lot of failures first before they reached whatever position they are in right now. What these people did was not to get affected by these failures and instead just rise above them. If you have been experiencing a lot of failures lately, the best thing that you can do is to not get discouraged and continue trying. The moment you stop trying, that is the time you can really tell yourself you failed. Instead of feeling bad or sorry about yourself, rise above your troubles. Here are some tips on how to achieve success.
First, set a specific goal for yourself. Know exactly what you want to do. Focus on a single goal instead of having too many. Multitasking often results in not being able to do any of the tasks well. Just concentrate on one goal so you can devote enough time and attention on it.
Study all your options. What are the things that you must do to achieve that one goal? Determine which ones you should do first and which ones should take the last priority. Usually, it is best to do the small ones first.
Set a time table. Set when you want each task to be finished. Make sure that you set achievable objectives so you don't get frustrated when you fail to meet them.
Get support from the people around you. They can either directly help you with what you are doing or they can provide moral support to boost your confidence.
Just always remember that it is not only you who experience failures. Even the successful ones went through those.
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Training and development (also labelled as "learning and development") is always acknowledged as crucial to the success of any business; both in-house and outsourced; whether training courses, on-line learning or executive coaching. Conversely, it is often the first area to feel the cutbacks when times are hard. As a busy executive, it can be challenging to balance the responsibility for developing your team with reducing budgets and focusing on the bottom line. However, think positive, it may not be your responsibility only.
So how do we define training and development (or T&D for short)? How about: equipping people with new skills, knowledge, attitudes or experience which they are then able to apply to their workplace and careers? That's a nice, broad definition which we can break down into three broad categories:
* what people need to do their job as it is today; * what people need to do their job was it will be tomorrow; and * what people need to do the jobs they want in the future.
From this we see that T&D can equip people to do their job, stay abreast of the changing requirements of that job and also help them in their career progression. Therefore, there are clear immediate benefits to the business (the first two categories) and definite future benefits to the individual (their career.) Of course, the individual also benefits from being well-trained in their daily role and the business benefits from developing its own future executives in-house.
At this point, we might want to question this word, "training", which tends to suggest activity geared towards a specific task or role. It also implies a process that is done to the individual rather than being something that they can fully engage with (after all, dogs are 'trained'.) Perhaps the better and more inclusive term would be "learning", which suggests a wider range of options (including mentoring and coaching) and also, perhaps, a wider range of applications.
Returning to the issue of responsibility: if the benefits are shared, shouldn't the responsibility also be shared? Traditionally, a manager might appraise each team member (sometimes in secret), personally decide what they needed by way of improvement and then prescribe the appropriate off-the-shelf training course. This is a Doctor model, where the manager acts as authority, diagnostician and decision-maker. Within limits, it can be efficient and it certainly saves time, but the lack of involvement of the individual can lead to lack of engagement with the training and therefore a lack of benefit.
These days we see more of a Coach model in which the manager and individual discuss the training needs and make decisions together. The coach guides the individual through the process of identifying and meeting their development needs with an emphasis on which solution will suit both them and the business. Those with particular potential, the 'rising stars' may even manage their own development allowance or budget and be free to seek tailored coaching outside the organisation (on the understanding that the results are applied within the organisation.)
Ask yourself how it works in your workplace. Do individuals have development objectives? Are they imposed or agreed? How are development options chosen? Is the criteria solely business efficiency or does it also take into account the individual's learning style? Is there support available to apply the learning to their role? Are they coached through their career development?
So think positive and engage your team in their own learning. The key factors are: involvement; discussion; business needs and personal aspirations; not just "training" but "learning"; and joint decision-making. That can mean joint success for you and your people.

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