Human Resource Blues

What do you think is the most commonly found difficulty in owning and running your own business? Some may say access to capital, access to markets or managing a work-life balance. Ask a handful of business owners and you’ll find that managing employees is their toughest challenge.

From hiring, firing and counseling through the dramas humans attach themselves to, maintaining a happy, productive and cost effective workforce in any business is challenging. To make the challenge more interesting, the workforce is seeing dynamic differences in the generations represented within most companies. These differences have frustrated both ends of the spectrum.

Yet, one of the most commonly seen problems with employees is the tie between salary and production. Business owners have seen trends in employees arriving at work with an entitlement mentality. Often times, employees assume their work is solely for the benefit of the business owner. In reality, most business owners earn less per year than the bulk of their employees.

Employees go further in their entitlement mentality, buy expecting yearly pay raises and bonuses. However, the amount of work being produced by the employee seldom increases. In order for a small business to prosper, the business needs to prosper financially in order to pay an increased salary.

Michael Alter with Inc.com recently wrote about employee compensation. He noted, “most employers don’t have a problem giving raises to their employees if the employees are doing their part to ensure business growth and profitability.” Michael went further by stating: “However, in many companies that’s a big ‘if.’ When profitability plateaus, employees generally interpret flatline compensation as a sign of disrespect instead of making the connection between compensation and job performance.”

One way business owners can escape from the employee entitlement mentality is by creating a performance incentive program. Rather than paying employees their salary and bonuses automatically with the assumption they he/she would earn at least a cost of living raise every year, turn the table onto them. If an employee wants a raise or bonus, develop an incentive program with clearly defined goals the employee has to reach in order to receive more money.

In establishing goals for the employee, make sure they are realistic, fair and have value for the company. Communicate with the employee throughout the year about where they are, what they have achieved and what may be going wrong. Have conversations with the employee at least once a quarter or more.

As a business owner, also utilize noncash rewards for good work being produced. In between the pay checks, if an employee or a team rises above the your expectations, take the time to thank them. You can get creative in ways to encourage their work. From buying lunch to putting a thank you card on their desk, small personal incentives often go much further in motivating than cold cash.

Finally, remember employees typically seek work that is rewarding to them rather than seeking large sums of money for their time. Creating an environment where they feel appreciated and motivated to deliver the productivity the company needs is a win-win situation.

Balancing Act

You are a business owner whose day begins well before the sun rises: you need to get the children dressed and to school, attend a 7:30 meeting, get started on email via the Blackberry, get to the office to find employees having problems, return voicemail messages and discover business operations that need addressing. This is all before 9:00 a.m. During the day, you have customers, vendors and your CPA begging for your attention before your children need to be taxied to tutoring or soccer, your spouse needs help at home and you still need to engage in business planning, balance the day’s financials and review business performance. How do you balance life’s needs in running a business?

While there are countless resources on the subject, people continue to feel the pressures of managing their personal, family and business lives. Each day puts direct and indirect pressure on our lives to act a certain way, obtain certain goals, and engage in certain activities. We receive countless messages on what our lives should look like, feel like and achieve. Add those pressures to the reality of your day, and you have a much stressed out situation.

To combat life and work toward balance, the Mayo Clinic has the following tips to consider:

1. Keep a log. We all have 168 hours a week, no more or no less. Try to track everything you do for one week and how much time it takes (even brushing your teeth) so that you can account for the 168 hour week. Review your week and see what activities you are doing for necessity, that you enjoy and that you could live without. For the “live without” items, can you delegate or outsource those at work and/or at home?
2. Learn to say no. Whether it’s a civic club asking you to spearhead an extra project or your child’s teacher asking you to manage the class play, remember that it’s OK to respectfully say no. When you quit doing the things you only do out of guilt or a false sense of obligation, you’ll make more room in your life for the activities that are meaningful to you.
3. Leave work at work. With today’s global business mentality and the technology to connect to anyone at any time from virtually anywhere, there’s no boundary between work and home — unless you create it. Make a conscious decision to separate work time from personal time.
4. Manage your time. Organize household tasks efficiently. Doing one or two loads of laundry every day, rather than saving it all for your day off, and running errands in batches are good places to begin. A weekly family calendar of important dates and a daily list of to-dos will help you avoid deadline panic. Include your children in adding their calendar items too.
5. Communicate clearly. Limit time-consuming misunderstandings by communicating clearly and listening carefully. Take notes if necessary.
6. Nurture yourself. Set aside time at least once a week (preferably more) for an activity that you enjoy, such as walking, working out or listening to music.
7. Set aside one night each week for recreation. Take the phone off the hook, power down the computer and turn off the TV. Discover activities you can do with your partner, family or friends, such as playing golf, fishing or canoeing. Making time for activities you enjoy will rejuvenate you.
8. Protect your day off. Try to schedule some of your routine chores on workdays so that your days off are more relaxing.
9. Get enough sleep. There’s nothing as stressful and potentially dangerous as working when you’re sleep-deprived. Not only is your productivity affected, but also you can make costly mistakes. You may then have to work even more hours to make up for these mistakes.
10. Bolster your support system. Find a mentor (you can have more than one) to help you with your business. This gives you an outlet for the various challenges you will face in being a business owner away from others in your life who may not be able to give you the support you need.