Three financial resolutions that can benefit your business

Ringing in the new year with a few resolutions? As you make plans to eat more healthfully and finally run that 5K, it might also be a good time to set some business goals. While the best resolutions will vary from business to business, here are three key promises most companies should keep.

1. Tune into 2011.
Don't just close your books and kiss 2011 goodbye. If you hit speed bumps or found new opportunities over the last 12 months, that may be an indication of where your company should turn its attention now, says Michael Carney, founder of MWC Accounting in Chicago. Did you struggle with cash flow management? Find a new area for growth? Study the actions that led to such occurrences and see if you can avoid or duplicate them to make your business stronger.

2. Look for savings.
Sticking with the status quo can cost you: January is the best time to trim budgetary fat, says Richard Stone, a principal in the Valhalla, N.Y., office of national accounting firm MBAF-ERE CPAs. Find better rates on insurance, telephone service, supplies and other business expenses. Cancel unused service contracts or subscriptions. It's a tough market out there for refinancing, but interest rates are low, Carney adds. Investigate refinancing real estate or other loans.

3. Find your replacement.
Succession planning is an area that is "widely overlooked by small-business owners," Stone says. The new year provides a great opportunity to address the next generation of your business, regardless of when you plan to retire officially. Once you identify a successor, Stone says, you can craft a plan to transfer business ownership incrementally. That way, you afford yourself the greatest flexibility and tax advantages.

Startup Mentor is a place for all the Startups to find their virtual mentors. The forum is dedicated to giving ideas to the aspiring entrepreneurs and the first generation entrepreneurs. If you fee that you can contribute to the community of entrepreneurs by providing your articles, opinions, analysis and case studies, please send an email to startupmentor@gmail.com

Is an Office Vampire Draining Your Productivity?

You don't need to go trick-or-treating to see vampires. Odds are good that they're in your office, and they're ruining your business life.

As a consultant on workplace morale issues, I often find that bad morale stems from one or two workers in the office who have a poor attitude about the place. Office vampires drain valuable time and energy you could be using to run your business, or simply enjoy your life.

If you have a worker who is so frustrating to deal with that you find yourself thinking of the situation while you're spending time with your family, or hanging out with a friend, you may have a vampire in your office.

Luckily, there are tools you can use to deal with these vampires. Think of it as a vampire-slayer utility belt. Here's what you can bring to bear on them:

Pull out the garlic. Redirect the office vampire when he or she expresses something negative by changing the flavor of the subject right away. "So how about those Atlanta Braves?" OK, maybe don't talk about the Braves right now, but you get my point. Change the subject abruptly.

Hold up a mirror. In the same way that vampires can't see themselves in mirrors, most of the problems expressed by the office vampires don't turn out to be there when a mirror is held up to them. Whatever they thought was negative doesn't actually exist. The mirror actually involves recasting or reframing the conversation, acknowledging what was said, but then challenging the opinion with a more positive point of view. They might complain the weather is getting cold, but you can respond that you're looking forward to hunting season, or the holidays.

Pull out a UV flashlight. I know it can be tough, but sometimes you need to get rid of the vampire. I actually find this is hard for many business owners because they try to empathize with the vampire in their midst. But you're running a business, not a self-help group. Don't let the vampire waste your time, energy, or attention. Instead let him or her go in the quickest and most humane way possible.

Move quickly to ward off your vampires. I often find their negativity easily spreads. If you keep them around, your company could turn into a vampire clan. Then you'll really be in trouble.

know this is cliché, but you actually could be doing the vampire a favor by letting him or her go. I often find that vampires act the way they do because they simply aren't in a job where they can make a unique contribution that satisfies them.

I once worked with a broadcasting group where the office manager micromanaged everything and everyone. She even busted people's chops for taking too many pens and paper clips. The company managers finally made the call and decided to help her find something else.

She went back to school and is now a minister. She's actually an excellent preacher and loves her new life. She went from making everybody miserable, to inspiring them.

What success stories will you tell from slaying the vampires around your office?

Tips on Performance Review

Which is worse: receiving a performance review, or giving one? At least with the latter you have some control. When you’re the one conducting the review, try doing these three things to make it a productive experience.

• Set expectations early. Make employee-evaluation practices clear at the beginning of the year with individual performance planning sessions.
• Set the right tone. Everyone hates the “feedback sandwich”: compliments, criticism, then more niceties. Deliver a positive message to your good performers by mainly concentrating on their strengths and achievements. Confront poor performers and demand improvement.
• Avoid money talk. If possible, don’t mention compensation during the review; but if you must, divulge the salary information at the start of the conversation.

Startup Mentor is a place for all the Startups to find their virtual mentors. The forum is dedicated to giving ideas to the aspiring entrepreneurs and the first generation entrepreneurs. If you fee that you can contribute to the community of entrepreneurs by providing your articles, opinions, analysis and case studies, please send an email to startupmentor@gmail.com

Are You a Born Entrepreneur?

One reason is that our genes influence the decision to start a business. I don't mean that figuratively; I mean it scientifically. With colleagues at Kings College in London and the University of Cyprus, I have been investigating how genes affect entrepreneurship for more than five years. Through studies of twins, and more recently, through molecular genetics laboratory research, we have found that genes influence whether people start businesses, are self-employed, or have owned their own companies. Our research shows that the same genetic factors influence the tendency both to see business opportunities and to start companies, as well as how much money self-employed people earn.

At this point you may be wondering how researchers could determine that there's a genetic component to entrepreneurship. It's actually pretty straightforward.

With twins, it's a matter of comparing the choices of the two siblings. Identical twins share the same genetic composition, while fraternal twins have half in common. If pairs of identical twins make more similar choices, such as starting a business, than pairs of fraternal twins, then genetics must affect the choices, as long as a few scientific assumptions hold. In the molecular genetics research, we examine the different versions of genes people have and see if entrepreneurs are statistically more likely to have one version over another.

There are probably many ways genes influence whether or not we become entrepreneurs, but in the twins research, we have found initial evidence that one route clearly is through our personalities. The same genes that affect whether we are extroverted, open to experience, disagreeable and sensation seeking also influence our decision to start our own business. Furthermore, the same genes that influence the tendency to be open to experience also affect the tendency to identify new business opportunities.

Before you start worrying that this research will usher in the world portrayed in the science- fiction thriller Gattaca, we are a long, long way from any practical application of these findings. That will come only after many years of replicating the findings.

Moreover, there's no single gene or even set of genes for entrepreneurship. Our genes influence broader categories of behavior, such as whether we do things that involve a great deal or small amount of novelty. While entrepreneurship might involve pursuing novelty, so do many other human activities.

Further complicating the issue, hundreds of genes probably influence whether or not we become entrepreneurs. Thus far in the molecular genetics research, we've found initial evidence for just one of them--a version of a gene for a receptor for the brain chemical dopamine.

Geneticists have speculated that sensation-seeking people have versions of dopamine receptor genes that require more stimulating experiences in order to produce a given amount of dopamine in the brain. To get the higher level of stimulation, those people are more likely to engage in sensation seeking activities, including starting businesses.

While your genes influence whether or not you become an entrepreneur, experience matters, too. Genes don't determine anything you do; they merely influence what you do in the same way your life experiences do. Just as receiving a financial windfall increases your odds of starting a business, so too does having a particular genetic makeup. But just as some people without a penny to their name start companies, so too can people without the genetic make-up associated with entrepreneurship.

While the research so far is limited, it does mean that when you describe someone as a born entrepreneur, you really are onto something.

When to Let Employees Work from Home

Q: When should a company allow its employees to work from home?

A: It's not as easy as giving everybody a laptop and sending them on their way. But when a company's leadership creates the right workplace culture, says Jim Ball, co-founder of Alpine Access, a Denver-based virtual call-center company and a pioneer in the delicate art of telecommuting, the arrangement can benefit workers, management and the bottom line.

"You have to have it in your DNA the fact that you don't have workers coming into an office space," says Ball, whose 4,500 employees--spread across 45 states--all work from home.

Creating that culture, he adds, means planning ahead to prevent the chaos that can result if you don't. You'll need to take into account, for example, training, security and communication issues. In most organizations, Ball says, the direction should come from the top. "There needs to be a person at a level of responsibility who absolutely embraces the model and ensures that the model is put into place correctly," he says. "For a small company, that needs to be the CEO. The CEO needs to say, ‘We're going to embrace this. We're going to get it done the way it needs to be done.'"

A key part of getting it done is making sure that every worker--at home or in the office--has equal access to technology, supervisors and, of course, promotions. What you don't want to do, Ball says, is create an us vs. them scenario.

"You can end up with people who feel isolated, limited in their ability to move up the corporate ladder, frustrated if the technology does not work," Ball says. "There's a whole list of things that need to be considered when you're putting together a work-at-home operation."

That starts during the hiring process. It's vital to screen your employees carefully, Ball says, to determine who among them can prosper working away from the office. At Alpine Access, prospective employees go through a battery of tests, including a personality test, to identify those who are most comfortable operating on their own (each test is given online or over the phone, rather than in person). "We can tell these are folks who don't need face-to-face interaction," Ball says, "who don't feel threatened by not being physically seen."

As Ball sees it, telecommuting just makes good business sense. It's clear that many other employers agree. Nearly 3 million Americans work principally from home (not including those who are self-employed), according to a study released earlier this year by the Telework Research Network. Another study, by WorldatWork, an organization of HR professionals, showed the proportion of American employers offering work-at-home options grew from 30 percent in 2007 to 42 percent in 2008.

Telecomm "In coming years' work forces, this is going to become more of an expectation with [younger workers]," Ball says. "Preparing for that is really going to give your company access to what's really going to make you successful, and that's high-quality talent."

Decisions That Waste Time and Money

Many managers rely on gut instinct to make important decisions, which often leads to poor results. On the contrary, when managers insist on incorporating logic and evidence, they make better choices and their companies benefit. Here are three ways to introduce evidence-based management at your company:

• Demand evidence. Whenever anyone makes a compelling claim, ask for supporting data. Don't take someone's word for it.
• Examine logic. Look closely at the evidence and be sure the logic holds up. Be on the lookout for faulty cause-and-effect reasoning.
• Encourage experimentation. If you don't have evidence, create some. Invite managers to conduct small experiments to test the viability of proposed strategies and use the resulting data to guide decisions.

Startup Mentor is a place for all the Startups to find their virtual mentors. The forum is dedicated to giving ideas to the aspiring entrepreneurs and the first generation entrepreneurs. If you fee that you can contribute to the community of entrepreneurs by providing your articles, opinions, analysis and case studies, please send an email to startupmentor@gmail.com

Seven Steps to Superstar Employees

Many employers sit their workers down once a year for a review. At that time, the employee finds out what they've been doing right or if there are areas in need of improvement. But what happens the other 364 days of the year?

Coaching is a different approach to developing employees' potential. With coaching, you provide your staff the opportunity to grow and achieve optimal performance through consistent feedback, counseling and mentoring. Rather than relying solely on a review schedule, you can support employees along the path to meeting their goals. Done in the right way, coaching is perceived as a roadmap for success and a benefit. Done incorrectly and employees may feel berated, unappreciated, even punished.

These seven steps, when followed, can help create a positive environment for providing feedback.

Step 1: Build a Relationship of Mutual Trust
The foundation of any coaching relationship is rooted in the manager's day-to-day relationship with the employee. Without some degree of trust, conducting an effective coaching meeting is impossible.

Step 2: Open the Meeting
In opening a coaching meeting, it's important for the manager to clarify, in a nonevaluative, nonaccusatory way, the specific reason the meeting was arranged. The key to this step is to restate -- in a friendly, nonjudgmental manner -- the meeting purpose that was first set when the appointment was scheduled.

Step 3: Get Agreement
Probably the most critical step in the coaching meeting process is getting the employee to agree verbally that a performance issue exists. Overlooking or avoiding the performance issue because you assume the employee understands its significance is a typical mistake of managers. To persuade an employee a performance issue exists, a manager must be able to define the nature of the issue and get the employee to recognize the consequences of not changing his or her behavior. To do this, you must specify the behavior and clarify the consequences.

The skill of specifying the behavior consists of three parts.

• Cite specific examples of the performance issue.
• Clarify your performance expectations in the situation.
• Asks the employee for agreement on the issue.

The skill of clarifying consequences has two parts.

• Probe to get the employee to articulate his or her understanding of the consequences associated with the performance issue.
• Ask the employee for agreement on the issue.

Step 4: Explore Alternatives
Next, explore ways the issue can be improved or corrected by encouraging the employee to identify alternative solutions. Avoid jumping in with your own alternatives, unless the employee is unable to think of any. Push for specific alternatives and not generalizations. Your goal in this step is not to choose an alternative, which is the next step, but to maximize the number of choices for the employee to consider and to discuss their advantages and disadvantages.

This requires the skill of reacting and expanding. You should acknowledge the employee's suggestion, discuss the benefits and drawbacks of the suggestion, ask for and offer additional suggestions, and ask the employee to explain how to resolve the issue under discussion.

Step 5: Get a Commitment to Act
The next step is to help the employee choose an alternative. Don't make the choice for the employee. To accomplish this step, the manager must be sure to get a verbal commitment from the employee regarding what action will be taken and when it will be taken. Be sure to support the employee's choice and offer praise.

Step 6: Handle Excuses
Employee excuses may occur at any point during the coaching meeting. To handle excuses, rephrase the point by taking a comment or statement that was perceived by the employee to be blaming or accusatory and recast it as an encouragement for the employee to examine his or her behavior. Respond empathically to show support for the employee's situation and communicate an understanding of both the content and feeling of the employee's comment.

Step 7: Provide Feedback
Effective coaches understand the value and importance of giving continual performance feedback to their people, both positive and corrective.

There are a few critical things to remember when giving feedback to others. Feedback should:

Be timely. It should occur as soon as practical after the interaction, completion of the deliverable, or observation is made.
Be specific. Statements like "You did a great job" or "You didn't take care of the clients' concerns very well" are too vague and don't give enough insight into the behavior you would like to see repeated or changed.
Focus on the "what," not the "why." Avoid making the feedback seem as if it is a judgment. Begin with "I have observed..." or "I have seen..." and then refer to the behavior. Focus on behavior and not the person. Describe what you heard and saw and how those behaviors impact the team, client, etc.
Use a sincere tone of voice. Avoid a tone that exhibits anger, frustration, disappointment or sarcasm.
Positive feedback strengthens performance. People will naturally go the extra mile when they feel recognized and appreciated. When corrective feedback is handled poorly, it will be a significant source of friction and conflict. When it is handled well, people will experience the positive effects and performance is strengthened.