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Quick Links and Good Ideas, June 2010

 

We hope that you are enjoying the early days of summer. Good things are worth the wait.

Survey says . . .
Work continues on our Adaptability and Innovation survey. The survey, being conducted in conjunction with the Family Firm Institute, will gauge how closely held and family business owners adapted to the Great Recession and the focus they are placing on innovation moving into the recovery . . . which, unfortunately, is arriving very slowly.

We have been receiving interesting information from the written survey portion, which is still in progress. In fact, learning of the survey, the Wall Street Journal’s MarketWatch column recently interviewed Barry to get a peek at some results and trends affecting family businesses, principally surrounding compensation. We’ll be publishing initial results later in the summer. In the meantime, the online survey is still open if you would like to participate. But hurry, it closes on Friday, June 18. Your input is greatly appreciated.

ESOPS
Last month we highlighted a presentation we heard by Mary Josephs of Evergreen Private Capital Advisors entitled "ESOPs: 'Another' Way of Doing Business." Mary spoke about the tax and liquidity advantages of ESOPS, as well as the benefits that accrue in terms of lessening workplace tensions and increasing overall performance. While ESOPs are not right for every company, in the right circumstances they can be a positive tool for ownership transition, ownership liquidity, and improving employee participation and morale—significant concerns to companies in today’s business climate.

Compensation Loosens Up
In "It Takes More than Current Compensation to Keep the Right People on the Bus," we referred to a Wall Street Journal article that reported on a number of companies that had started to both reverse previous salary reductions and give raises again as a way to win back the hearts and minds of their employees. We suggested that employee retention is more dependent on job satisfaction than on compensation.

A follow-on article in the May 25 Wall Street Journal entitled “More Workers Start to Quit” reinforced the notion that compensation, alone, is not enough to retain employees. One quoted statistic was from Dice.com, a job board for technology professionals. Dice.com asked its members what could persuade them to stay in their jobs. “57% of the 1,273 surveyed said nothing could persuade them to stay. Of those who said that they could be persuaded, 42% (18% of the total) said they wanted a higher salary and 11% (5% of the total) wanted a promotion.” Our question: is it the 23% that we would want to stay?

Why Doesn’t Our Team Work?
Lately, Patrick Lencioni’s book, The Five Dysfunctions of a Team: A Leadership Fable, has been a topic of conversation at strategic sessions with clients. Originally published in 2002, the book provides a very useful look at why teams often don’t work and what you can do to get them back on track.

Lencioni uses a pyramid structure to show why teams fail. At the base is the lack of trust between and among team members. From there, the pyramid builds up through layers including fear of conflict, lack of commitment, avoidance of accountability, and inattention to results.

The good news is that these dysfunctions, when recognized, can be reversed. How? Well . . . you will either need to read the book or give one of us a call.

Enjoy your summer!

Sincerely,
Barry Cain, former Managing Director, Strategic Services
David Spitulnik, former Director, Strategic Services 

 

This publication is part of Blackman Kallick’s marketing of professional services, and is not written tax advice directed at the specific facts and circumstances of any person and/or entity. Contents of this publication are of a general nature, and you should not act on this information without obtaining professional advice from your business advisor that is appropriately tailored to your individual needs and circumstances. This written advice is not intended or written to be used, and cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.