Monthly Archives: January 2017

Simple Tips to Help Employees Weather a Business Storm Cycle

The modern economy is in a constant state of change, which means businesses – large and small – must move quickly in response to market shifts.

Even the strongest companies will cycle through good times and bad, says Dave Hopson, managing partner at the information-technology consulting firm Triumphus and author of Surviving the Business Storm Cycle: How to Weather Your Business’s Ups and Downs.

Bringing out the best in employees is a challenge at the best of times. According to Gallup, only 32 percent of U.S. workers felt engaged in their jobs in 2015 – which was a pretty good year for the economy and business growth.

So imagine the struggle of keeping the best workers happy when the business transitions through a down period.

And it will. Hopson says every business goes through four repeating phases: start-up, high growth (what he calls the “tornado”), declining growth (the “avalanche”), and consolidation.

Picture the employees sliding downhill in that avalanche, and you get the idea: It’s up to a company’s leaders to help them hold on, to turn the inevitable transition period from exhausting to exhilarating.

How does a business leader manage that through possible layoffs and pay cuts or, at the very least, major changes to the processes that are used to get the work done every day?

Start putting people in the roles that fit them best.

“This is the time to ask some tough questions,” Hopson says. Who on the staff is so tired and discouraged they can no longer do their jobs well? Who has been moved outside of their normal roles, and how are they handling their new positions? Do they need to be moved back or not? “Once you’ve answered these questions, you can step back and take a more accurate look at your staff,” he says. “You’ll be able to add people where you need them – and remove people where you don’t.” The method to do this is quite simple. You perform a review of the process and find where it doesn’t work anymore or that where changes have been made on the fly. Following this, you can “fix” your process and then reassign your roles. Often businesses need external help to do this as it is hard to see the forest for the trees.

Expect resistance to change.

If this is painful for you as a manager, think about how it is for staff members who have a lot less control over the situation. “How you and your leadership team present change to your staff can make a world of difference,” Hopson says. Employees who feel involved in the change and understand what’s going on demonstrate a more rapid recovery and may even perform better in the end. Business leaders often fail to realize how staff feels when outsiders and “best practices” are brought in to create new processes and workflows without involving those who do the work. This is a recipe for disaster. Use the process method described above to mitigate this.

Clear and frequent communication is vital.

“If you introduce processes that staff members don’t understand or haven’t learned, you’re going to slow things down rather than speed them up,” Hopson says. Invest in your people, he advises. Make sure they always have proper training and equipment. Involve them, they know their job and where the process needs help. Keeping them involve will ensure you minimize resistance and will likely provide a much better process than any outsider could provide alone.

During the consolidation period between high times and low times and back to high times again, a leader’s primary role is to rally those frazzled and frustrated troops.

“Make sure everyone understands you’re in the midst of a normal process,” Hopson says. “And keep waving that flag so that no one gets discouraged.” Resist playing the blame game or calling out leaders or departments where the failures were most predominant. Remember, this is natural. Instead, focus on how you can make your people and processes scaleable so they are resistant to the failures of the previous cycle.

Should You Know 3 Questions That Can Make You a Better Leader

Some 70% of the workforce in the United States hates their job, according to recent polls by the Gallop organization. That’s more than two out of three people on this morning’s crowded subway or in that endless sea of cars that jams the freeways into our business centers across the country. These tens of millions of people are actively unhappy, finding little to no value in what they do for a living. They don’t fulfill the universal desire that all humans share: the need to find meaning in their work.

It doesn’t have to be this way. We, as a nation, can do better.

While it’s easy to want to blame these workers for their own unhappiness, the problem doesn’t lie with just them. They likely serve bosses who don’t care whether they’re satisfied or passionate. Those bosses serve higher leadership who are leaders in name only. They assume their job title and scope of authority, by definition, will be sufficient to inspire the following of their organizations.

My team and I built our company, Integra Telecom, from start up to national prominence, growing to become one of the 10 largest fiber based, landline telecom organizations in the US. Attributing our success to our people, I became fascinated by the behavior traits of leaders who successfully create companies that defy the national norms, building cultures of engaged workers. Learning from my journey and partnering with other leaders of nationally recognized, iconic organizations we refined our experience and developed the practical, every day tenants of Fusion Leadership, dedicated to fusing together teams of people who are committed to a shared Mission.

If you are a leader (or plan to become a leader) it is vital to examine what message your daily behaviors communicate in terms of how you prioritize the needs of your organization verses your own, ego-driven needs. Consider these three common questions every leader encounters:

Who do you prioritize within your organization?

As a young CEO I fixated on making sure I had the right leaders in the right places, I obsessed over the attendance and flow at board meetings and managing these priorities quickly filled my calendar, adding phone calls, emails and strain to my weekends. Sound familiar? Managers manage and that fills calendars. Unfortunately, c-level execs and board members are not the ones who serve customers and generate the life-blood of a business, revenues. Prioritizing peer level managers, executives and board members is important; however, it also runs the risk of sending this message to your front line employees: “I don’t have time for you” or “the work you perform is not important to me” or, the worst possible message, “you come to work every Monday morning just to make me wealthier and more powerful.”

Making your front line workers a top priority on your calendar sends the opposite message: “your work is vital to our success” or “this company cannot succeed without your contribution.” Equally important, your front line workers will help you discover where your organization is succeeding and where your organization is failing. These employees, more than any c-level executive, truly have their hands on the business. Investing the time to make my front line workers more successful became my highest priority as I matured in my CEO role. When a workforce truly believes the execs have their backs, amazing things happen, the organization fuses together, committed to the organizations’ Mission. Workers who show up on Monday morning to advance a Mission are significantly more engaged than workers who show up on Monday morning to advance the selfish interests of their boss.

When you conduct a meeting, who becomes the smartest person in the room?

After completing a large private capital raise, described by the Oregonian newspaper as the largest in Oregon’s history, I landed some national names on my board of directors. Determined to earn their confidence and demonstrate my executive prowess, I ran board meetings with a specific agenda and little patience for anyone who took the discussion on an unnecessary detour. That approach almost cost me one of my most valuable executives because I tended to cut him off in board meetings. At the time I felt that his contributions were too long winded and wandered too far from the message I wanted to deliver.

While it is important for a leader to conduct a meeting with professionalism and purpose, I came to learn that my style was partly influenced by another need. That need was for me to demonstrate my intellect and my command for the business. My interruptions communicated to this key member of our team that “I do not value your contribution” or that “I do not have confidence in your capability.” In fact, those messages were the opposite of how I viewed the contributions of this individual. Fortunately, thanks to my COO’s willingness to confront me on my style, I came to see the truth underlying this dynamic. After modifying my approach, this executive became a backbone to the organization, serving for many years until his successful retirement after a stellar career.

Whose job is it to step up for the customer?

Those times when a customer reaches their most agitated state, when they are proactively engaging your competition, when your organization resembles total melt-down- those are the most visible moments in an organization. Those are the times to step-up and lead.

Unfortunately, most leaders fall back on their job description: you’re an executive- delegate. What a shame, they miss out on the opportunity to seize the most important spotlight, they miss out on the opportunity to define, by their example, what the Mission truly means. They miss out on the opportunity to communicate their highest priority to their employees.

Answering these three questions will require that you engage with what I describe as the selfish verses collective ego dilemma. For example, my need to demonstrate my intellect in board meetings served my selfish ego at the expense of the effectiveness of my team, or the collective ego. How leaders behave when navigating these (and other) daily decisions communicates volumes to their employees and organizations. Over time these behaviors lay the foundation for a company’s culture and ultimately determine whether employees become engaged or fall victim to the national norm of some 70% of American workers who dread Monday morning

Should Know About Greatest Wealth Transfer

Anyone who just inherited a deceased parent’s IRA or 401(k) could be about to commit a costly blunder.

You can take the money from that retirement account in one big lump sum, no matter how young you are, but that will trigger a tax bill – probably a hefty one.

“It’s tempting to take the lump sum, especially if it represents a huge windfall of cash for you,” says wealth management advisor Rebecca Walser of Walser Wealth (www.walserwealth.com). “But you should be aware it’s also a windfall for the IRS.”

Walser, a successful tax attorney and certified financial planner who specializes in working with high net worth clients, says this issue will become an even more common one in the coming years as the aging Baby Boomers die off, transferring their wealth to their Generation X and Millennial offspring.

Some have called it the greatest wealth transfer in history, as over the next few decades the Boomers are expected to leave about $30 trillion in assets to their children and grandchildren.

Part of that money is in tax-deferred retirement plans such as a traditional IRA or an employee-sponsored 401(k) that Baby Boomers have been contributing to for decades.

They didn’t have to pay taxes on the money they contributed to those plans until they started withdrawing the money in retirement. But just to ensure those taxes aren’t deferred forever, the government requires a minimum withdrawal each year once the account holder reaches age 70½.

The IRS also isn’t picky about who does the paying, Walser says. It’s fine with collecting the taxes from heirs if the retiree dies before spending all the money.

A spouse who inherits such an account falls under different rules, but Walser has advice for anyone else who finds themselves in this situation:
  • Consider a tax strategy. If you inherit an IRA, think about your need for these gifted funds. If there is no need for the funds for at least five years, consider repositioning them into a tax-advantaged vehicle over the next five years and save yourself thousands of dollars in taxes over your lifetime. “We always prepare an RMD analysis and find that paying the tax man over the next five years, while we still have the second lowest tax base in U.S. history, is much more appealing than deferring the tax and then being trapped into paying them in a rising tax rate climate,” Walser says. Taxes must inevitably go up in the future, she says, because of our current federal debt of $20 Trillion combined with the concurrent retirement of the Boomers in mass.
  • Understand what kind of account you inherited. The rules for a Roth IRA are different from the rules for a traditional IRA. Taxes were already paid on the money that was contributed to a Roth. If the Roth was funded more than five years before the person died, you won’t need to pay taxes when you take distributions.
  • Don’t rush into a bad decision. You will face deadlines for when you have to make decisions (the IRS won’t remain patient forever), but there’s no need to be hasty and do something you’ll regret later, Walser says. If you don’t have a financial advisor, she says, it would be wise to find one who can help you figure out what the best tax strategy will be for your situation.

“Maybe you really do need the money, so taking the lump sum makes sense,” Walser says. “But I think most people who do that are going to regret it later, especially if they just blow all the money right away and don’t have anything to show for their inheritance.”