The following is a conversation that took place four weeks ago, on or about October 8, 2013 in the 700 block area of Ocean Drive, in the public park diagonally across from the former Victor Hotel, Miami beach (South Beach), Florida. The participants, sitting on the park bench, are Tony Tuscano and Jacob Levine. The time is approximately 10:30 a.m. Eastern Standard Time.
Tony Tuscono is the C.E.O. and founder of a high security company known as Golds, Sachs & Thomas which also does covert contractual work with a highly classified section of the U.S. government formed during the Presidency of '41'. GST with the main office in South Beach has offices in New Orleans and Shanghai. Tuscono's resume includes three degrees, fluency in four languages, action in three major conflicts, decorated ranger and 'spook' credentials involving over a hundred covert operations. Jacob Levine is a 'retired' Israel citizen visiting South Beach. 'Retired' from being the number two man in Israel's Mossad, the Central Insitute for Inteligence and Special Missions, and more specifically, the former Director in Israeli's Metsada, the clandestine operations command arm of the Mossad which runs small units of agents who carry out actions abroad against those considered to be a threat to Israeli security. They specialize in rescue, assassinations and sabotage.
According to security briefing documents, these two individuals first became friends in mid-1976 due to an incident which ocurred on June 27, 1976 when Air France flight A300, originating in Israel, was hijacked and forced to land in Entebbe Uganda. The Prime Minister of Israel, Yitzhak Rabin, ordered the Mossad to rescue the Air France passengers while it was on the ground in Idi Amin's Uganda. The commander in chief of the Mossad turned the rescue over to Levine and the Metsada unit. Swiftly dealing with Amin, the Metsada unit kidnapped Amin's daughter within twelve hours of the hijacked plane and, magically, the Uganda's government cooperation was instantaneous. According to all news accounts the heroic operation, thousands of miles from home, was a great success since all the hijacked passengers, with the exception of a Mrs Fora Block, were released to safety. Only one member of Levine's unit, Major Yonathan "Yoni" Netayahu, was killed in the course of the rescue. Levine was a real hero in his homeland.
What was never known about this operation, traveling under false identifications, were passengers Tony Tuscono and Chester Carson. They, according to classifed file documents, had just finished a rather involved operation in Jordan and through the cooperation of the Mossad escaped through Israel and coincidently were booked on Air France flight A300. When Rabin ordered the Entebbe rescue operation, he was fully aware of the two U.S. agents on board. A thousand miles away a hijacked aircraft lands in a country that is friendly to fanatical terrorism yet the final score showed eight terrorist dead, one civilian and one member of the unit. The order to take the plane only came after Tuscono and Carson had already disposed of all but two of the hijackers using Glock 28's with specially designed Heckler & Koch silencers made with Polymer 2, the 'space-age' plastic still in covert manufacturing processes decades later. The two remaining terrorists had secured themselves in the cockpit holding automatic weaponry to the pilot and co-pilot's heads. The Metsada unit blasted the cockpit door with 'flash' agent and newly created 'sound' canisters followed by sequencial rounds of silent automatic fire. Although the crew were injured, they somehow survived. The dead civilian died at the scene taking fire from one of the six terrorists as so stated in clasified file 173940 incident report dated September 1, 1976.
The conversation on the park bench, between these two old friends, started with Tuscono asking Levine how he enjoyed his first night in South Beach and the private belcony seating at Mango's, a South Beach night club celebrating their twenty-second year anniversay in business.
Levine, as cordial and mannered as his file so implies, simply smiled, thanked Tony and then stated, "My friend we are need of your assistance, or rather your assessment of a very serious matter."
Levine paused, took a deep breath of the ocean salt air, "Over all these years we have always respected each other's opinions whether we agreed or not. So today I simply ask, my very dear friend, please give me and my country your analysis of the Syrian situation with respect to Putin and Rowhani as I'm fully aware of your unique working relationship within the Soviet block for the past three and half decades."
There was a silence, the kind that can exist between friends, then Tuscono spoke. "One has to remember history and know the subject matter within the time frame that something occurs; that is the problem with history and historians as it seems the 'time frame' and 'personal points of view' have a tendency to detract from the truth. You ask me a very complex question; and yet, with all of your intel my response to you will not be what you expect."
Levine raised his hand in mock surrender "I would not be here if we didn't believe your perspective to be relavant regardless of its outward rational."
Tuscono facing Ocean Drive watching waiters clearing late morning breakfast plates served on one of the many patio's, as the morning sun started to raise its level of warmth on his back, picked his words carefully knowing full well the impact that they were about to make. "Well, my friend, here is my response to your question and the analysis that will hopefully serve you as well as some of our clientele in the very near future years. TO BE CONTINUED WITH PART II - The End Game
Thursday, November 07, 2013
Sunday, October 27, 2013
Volume 81 - The Customer is Not always right
The Customer is NOT always right is something that we have always known but have been uncomfortable to publicly claim since "the Customer" is the reason for our existence, and we have always been told 'no matter' the situation "the customer is always right." Herein, however, lets inspect this creature (the customer) and attempt to understand my belief that the Customer is Not always right, and where the 'Responsibilty' exists to correct, enhance or separate. We are all "customers", in one way or another, so we can all agree that depending on what 'side of the table' in which we sit our views are likely to be prejudicial.
First example: a couple with their two children come into a restaurant and order Pizza, soft drinks and coffee. The server takes the order and brings the drinks to the table to find both children out of their seats playing with placemats, condoments, and parmesan cheese shakers on another table; but, she goes about her duties without saying a word. A short time later their food order is served. Ten minutes after being served one of the adult customers calls, in a rather boisterous voice, the server over and complains that the pizza is not baked completely, although four slices are gone from the large serving plate. The server brings the remaining pizza back to the kitchen for reheating then back to the couple whose children remain drinking soda and continuing playing with cheese shakers and condiments. A few minutes pass and once again the server is called to the table and now the complaint is 'they' don't like the dough/crust although now more than 3/4 of the pizza has been eaten. The server apologizes and tells the patrons that there will be no charge for the pizza. The 'gentleman' further complains that the Pepsi is 'flat' and refuses to pay for the soft drinks further stating that this was their 'first' and 'last' trip to this restaurant. The couple with the two 'unmannered' children depart the restaurant but within five minutes of their departure, figuring that their 'satisfaction' is not quite satisfied, telephones the restaurant to speak with the owner or manager complaining that the server was a 'rude bitch.' It is quite obviously the customer was wrong and completely 'out of bounds'. This is a 'retail' example dealing with "the public", and considering our constant lowering of educational standards as well as our "Wal-Mart" dress standards mixed with our further declining disregard of 'parental responsibilty', simple respect and the basic 'manners'of a human being I'm not sure how anyone works in the 'service industry' as a server or bartender.
Now to the second example, and the MAIN POINT OF THIS BLOG, within the 'Commercial' arena where 'customers' tend to be 'repeat' in nature and normally have years of experience with the vendor/manufacturer relationship:
A repeat commercial customer/distributor places multiple orders to be shipped UPS on their account. UPS notifies the manufacturer, after product has been manufactured, shipped and received by the customer, that the customer's account number has become invalid and now the shipper is responsible for the frieght charges. The customer refuses all communication with the manufacturer (who luckily had the customer pay in advance for the actual merchandise). Clearly, the customer is wrong (as well as UPS for accepting and delivering and then to notifiy the shipper that the account was closed). Clearly the Customer is not only wrong but deceitful.
A third example (again, within the 'commercial' arena): A customer, who has been a customer for over 4 years and although a 'slow' pay (over 45 days) knows that the terms of the deal are 1% ten net 30 has his account blossom to over 90 days. When approached via phone, and email concerning this matter he is insulted for he didn't realize the time 'started' at day of shipment. Clearly, the customer is wrong and that within his argument of 'starting' time attempts an excuse/complaint directed to avoid the actual problem.
I can write a 100 examples of the Customer/Client being wrong for whatever their motivation and justification but this is not a social psychological blog; it's much simplier, as it's about problem customer/client and Salespeople/Manufacturer Representatives. I forgo, for this blog, the service/retail industry for this category sets pricing by a 'Menu' or price 'tag' whereas in the Commercial-Industrial 'Sales' game exists that 'open window' to negotiate on numerous subjects such as price. This doesn't diminish the Service or Retail industry working people, and techniques needed, who have to daily deal with the rude, uneducated, moronic people that visit their shop, restaurant or bar.
It is my belief that within the 'Commercial' arena of 'sales' it is the responsibility of the Salesperson to be skilled enough to handle all customer types and to manage appropriate time to accomplish goals of the company they represent. The catagories that are of discussion involves those clients/customers that 'Grinds' on price, Indecisive, Buys competitive product, 'Loves' what you say but doesn't buy, 'Knows' it all, Lies to you, Egomaniacs, Incompetent, Complainers, and Those who simply have no buying authority. Each of these catagoies are blogs/teaching sessions by themselves but the point of this blog is to say that although each of these catagories makes the client/customer 'wrong' or simply difficult, it is still remains the RESPONSIBILITY of the Salesperson to OVERCOME EACH with proper technigue, knowledge, time management, and an 'eye' for the 'detail' without excuses for failure that are based on human fraility rather that specific detailed points of sale.
'Life' since 911 and the Global Economic stage since '08 is not as easy as it was even a few decades ago. Pressures of 'life' from one's home life, physical ailments, older parents, debt, death, etc. are all part of today's heighten struggle; nevertheless, the days of conventional sales approaches simply taking clients to dinner, drinking and 'hugs' don't cut it today where upper level sales techniques and time management must be mastered to actually sell products.
As challenging and as stressful as client problems may be to handle it is the very reason why salespeople exist. If every customer simply handed you an order without a struggle, most salespeople would not be needed. Problem clients are more than a reason for justifying your job, as they also represent an opportunity, but the salesperson must prove their own value both to the customer and to their employer.
First example: a couple with their two children come into a restaurant and order Pizza, soft drinks and coffee. The server takes the order and brings the drinks to the table to find both children out of their seats playing with placemats, condoments, and parmesan cheese shakers on another table; but, she goes about her duties without saying a word. A short time later their food order is served. Ten minutes after being served one of the adult customers calls, in a rather boisterous voice, the server over and complains that the pizza is not baked completely, although four slices are gone from the large serving plate. The server brings the remaining pizza back to the kitchen for reheating then back to the couple whose children remain drinking soda and continuing playing with cheese shakers and condiments. A few minutes pass and once again the server is called to the table and now the complaint is 'they' don't like the dough/crust although now more than 3/4 of the pizza has been eaten. The server apologizes and tells the patrons that there will be no charge for the pizza. The 'gentleman' further complains that the Pepsi is 'flat' and refuses to pay for the soft drinks further stating that this was their 'first' and 'last' trip to this restaurant. The couple with the two 'unmannered' children depart the restaurant but within five minutes of their departure, figuring that their 'satisfaction' is not quite satisfied, telephones the restaurant to speak with the owner or manager complaining that the server was a 'rude bitch.' It is quite obviously the customer was wrong and completely 'out of bounds'. This is a 'retail' example dealing with "the public", and considering our constant lowering of educational standards as well as our "Wal-Mart" dress standards mixed with our further declining disregard of 'parental responsibilty', simple respect and the basic 'manners'of a human being I'm not sure how anyone works in the 'service industry' as a server or bartender.
Now to the second example, and the MAIN POINT OF THIS BLOG, within the 'Commercial' arena where 'customers' tend to be 'repeat' in nature and normally have years of experience with the vendor/manufacturer relationship:
A repeat commercial customer/distributor places multiple orders to be shipped UPS on their account. UPS notifies the manufacturer, after product has been manufactured, shipped and received by the customer, that the customer's account number has become invalid and now the shipper is responsible for the frieght charges. The customer refuses all communication with the manufacturer (who luckily had the customer pay in advance for the actual merchandise). Clearly, the customer is wrong (as well as UPS for accepting and delivering and then to notifiy the shipper that the account was closed). Clearly the Customer is not only wrong but deceitful.
A third example (again, within the 'commercial' arena): A customer, who has been a customer for over 4 years and although a 'slow' pay (over 45 days) knows that the terms of the deal are 1% ten net 30 has his account blossom to over 90 days. When approached via phone, and email concerning this matter he is insulted for he didn't realize the time 'started' at day of shipment. Clearly, the customer is wrong and that within his argument of 'starting' time attempts an excuse/complaint directed to avoid the actual problem.
I can write a 100 examples of the Customer/Client being wrong for whatever their motivation and justification but this is not a social psychological blog; it's much simplier, as it's about problem customer/client and Salespeople/Manufacturer Representatives. I forgo, for this blog, the service/retail industry for this category sets pricing by a 'Menu' or price 'tag' whereas in the Commercial-Industrial 'Sales' game exists that 'open window' to negotiate on numerous subjects such as price. This doesn't diminish the Service or Retail industry working people, and techniques needed, who have to daily deal with the rude, uneducated, moronic people that visit their shop, restaurant or bar.
It is my belief that within the 'Commercial' arena of 'sales' it is the responsibility of the Salesperson to be skilled enough to handle all customer types and to manage appropriate time to accomplish goals of the company they represent. The catagories that are of discussion involves those clients/customers that 'Grinds' on price, Indecisive, Buys competitive product, 'Loves' what you say but doesn't buy, 'Knows' it all, Lies to you, Egomaniacs, Incompetent, Complainers, and Those who simply have no buying authority. Each of these catagoies are blogs/teaching sessions by themselves but the point of this blog is to say that although each of these catagories makes the client/customer 'wrong' or simply difficult, it is still remains the RESPONSIBILITY of the Salesperson to OVERCOME EACH with proper technigue, knowledge, time management, and an 'eye' for the 'detail' without excuses for failure that are based on human fraility rather that specific detailed points of sale.
'Life' since 911 and the Global Economic stage since '08 is not as easy as it was even a few decades ago. Pressures of 'life' from one's home life, physical ailments, older parents, debt, death, etc. are all part of today's heighten struggle; nevertheless, the days of conventional sales approaches simply taking clients to dinner, drinking and 'hugs' don't cut it today where upper level sales techniques and time management must be mastered to actually sell products.
As challenging and as stressful as client problems may be to handle it is the very reason why salespeople exist. If every customer simply handed you an order without a struggle, most salespeople would not be needed. Problem clients are more than a reason for justifying your job, as they also represent an opportunity, but the salesperson must prove their own value both to the customer and to their employer.
Wednesday, October 02, 2013
Volume 80 - The Second Day of Government Shutdown
....Has anyone noticed that the Federal Government is in the 2nd day of a 'shutdown'? Not only has this action caused little or no inconvenience we shouldn't stop the 'shutdown' but should enlarge its scope.
Since the Federal Government keeps doubling its size every five years or so, now is the perfect time to cut the excessive amount of Federal employees. You say this cannot be done....here's the rationale and solution to this ever growing 'monster' that lives in the 'beltway'. Since little is being accomplished when the following agencies actually 'work' (debatable term) and now 'shutdown', which is not even noticable by the average tax paying citizen, send the Energy, HUD, Commerce, Interior, and Education agencies into moth balls and put the IRS into a three year phase out.
Make Congress a seven year one term position, with the obligation/requirement of a 'Balanced Budget' for each year of their elected position with subsequent penalties, known as 'accountability', with the same health care, social security, type benefits/obligations as (again) the average tax paying citizen. In addition, this would apply to all their staff/employees, after which they can all return to their former jobs (if they had any to begin with).
As Daniel Webster wrote, at the close of the Constitutional Convention in Philadelphia, "Good intentions will always be pleaded for every assumption of authority. It is hardly too strong to say that the Constitution was made to guard the People against the dangers of good intentions. There are men in all ages who mean to govern well, but they mean to govern. They promise to be good masters, but they mean to be masters."
Since the Federal Government keeps doubling its size every five years or so, now is the perfect time to cut the excessive amount of Federal employees. You say this cannot be done....here's the rationale and solution to this ever growing 'monster' that lives in the 'beltway'. Since little is being accomplished when the following agencies actually 'work' (debatable term) and now 'shutdown', which is not even noticable by the average tax paying citizen, send the Energy, HUD, Commerce, Interior, and Education agencies into moth balls and put the IRS into a three year phase out.
Make Congress a seven year one term position, with the obligation/requirement of a 'Balanced Budget' for each year of their elected position with subsequent penalties, known as 'accountability', with the same health care, social security, type benefits/obligations as (again) the average tax paying citizen. In addition, this would apply to all their staff/employees, after which they can all return to their former jobs (if they had any to begin with).
As Daniel Webster wrote, at the close of the Constitutional Convention in Philadelphia, "Good intentions will always be pleaded for every assumption of authority. It is hardly too strong to say that the Constitution was made to guard the People against the dangers of good intentions. There are men in all ages who mean to govern well, but they mean to govern. They promise to be good masters, but they mean to be masters."
Tuesday, September 03, 2013
Volume 79 HERE WE GO AGAIN!
As of 12:30 p.m. EST we have not as yet embarked on another war as the 'leaders' of our great nation forces us to become the 'policemen' of the universe. However, now with House Speaker John Boenmer support, the President will certainly stike against the present Syrian regime under some type of 'humanitarian argument' but please don't attempt to sell us again the American Security argument as we've been sold that product under the disquise of the 'domino theory' to WMD.
Lets face the ugly fact that the Twin Towers would still be standing if some federal authorities had gotten off their collective 'fat asses' and acted upon all available intel but failed, thus allowing a few radical Muslum underachievers to 'show off' to the world and kill 3,000 U.S. citiizens. We refuse to understand history and have no understanding whatsoever of the Middle East or Asia, countries with five thousand years of history, and yet continue to refuse to protect the borders of this great country.
It is time to return to a foreign policy that puts America's security first and no one has yet to prove (again) that this intervention into Syria's civil war is a security threat to America. Defending our nation is the federal government's most importand duty, not humanitarian responses to countries that hate us. If our National Security is, in fact, at risk then get a Declaration of War from Congress, Go fight it, Win it and get it Over with (unlike Korea,Vietnam, Iraq and Afcanistan).
I have deep feelings for all the millions of innocent people within the Middle East who have suffered at the hands of their tyrannical leadership over their thousands of years of history. I sincerely hope that there exists a special place in Hell for these tyrannical bastards that kill innocent women and children but they are not our responsibility. The people that live, work and struggle as legitimate U.S. citizens are our responsibility and its about time that we take care of ourselves and enforce the laws of this country within our country rather then spending hundreds of billions of dollars in and for countries that burn our flag and call for our distruction. We have over 900 military installations in over 150 countries and our National Security has been compromised because our troops are spread all over the universe and we can't protect even our own borders, and going broke attempting to be the world's policeman.
(Back to Syria for a moment and the forthcoming decision to attack)...the very reason that I'm a Constitutional Conservative with a Liberatarian slant is because today it doesn't matter if you're a Republican or Democrat; its all the same, its WHO IS IN OFFICE that makes the rule. Don't understand? Ok........here's a quote from now Vice President Joe Biden in 2007 "The president has no constittional authority...to take this nation to war...unless we're attacked or unless there is proof we are about to be attacked. And if he does, I would move to impeach him." Enough said!
Lets face the ugly fact that the Twin Towers would still be standing if some federal authorities had gotten off their collective 'fat asses' and acted upon all available intel but failed, thus allowing a few radical Muslum underachievers to 'show off' to the world and kill 3,000 U.S. citiizens. We refuse to understand history and have no understanding whatsoever of the Middle East or Asia, countries with five thousand years of history, and yet continue to refuse to protect the borders of this great country.
It is time to return to a foreign policy that puts America's security first and no one has yet to prove (again) that this intervention into Syria's civil war is a security threat to America. Defending our nation is the federal government's most importand duty, not humanitarian responses to countries that hate us. If our National Security is, in fact, at risk then get a Declaration of War from Congress, Go fight it, Win it and get it Over with (unlike Korea,Vietnam, Iraq and Afcanistan).
I have deep feelings for all the millions of innocent people within the Middle East who have suffered at the hands of their tyrannical leadership over their thousands of years of history. I sincerely hope that there exists a special place in Hell for these tyrannical bastards that kill innocent women and children but they are not our responsibility. The people that live, work and struggle as legitimate U.S. citizens are our responsibility and its about time that we take care of ourselves and enforce the laws of this country within our country rather then spending hundreds of billions of dollars in and for countries that burn our flag and call for our distruction. We have over 900 military installations in over 150 countries and our National Security has been compromised because our troops are spread all over the universe and we can't protect even our own borders, and going broke attempting to be the world's policeman.
(Back to Syria for a moment and the forthcoming decision to attack)...the very reason that I'm a Constitutional Conservative with a Liberatarian slant is because today it doesn't matter if you're a Republican or Democrat; its all the same, its WHO IS IN OFFICE that makes the rule. Don't understand? Ok........here's a quote from now Vice President Joe Biden in 2007 "The president has no constittional authority...to take this nation to war...unless we're attacked or unless there is proof we are about to be attacked. And if he does, I would move to impeach him." Enough said!
Thursday, August 15, 2013
Volume 78 The Consensus of Stupidity
....As I'm sitting in my local bar attempting to wash away a terrible sales day at my company, a group of golfers start arriving after their Wednesday afternoon round of golf. I'm familiar with most of them as we all live within this small town of under 10,000 people. They all gather at the other end of the bar from where I'm sitting and carry on about their round of golf, paying up bets, arguing about shots made or missed, the usual conversations that takes place with guys after a round of golf. One of the players, who I've known for over forty years waves me over to the other side of the bar to join them. Actually I've been doing quite well with my 'shots' of chilled Crown and Bud Lite (to the extent that the bartender placed 'my' fifth in the beer cooling rather than having 'to shake with ice') and the last thing I needed was to join in with the golfing group; nevertheless, against my better judgement, which was obviously somewhat clouded, I moved to the seat next to (lets call him) Ralph.
After the normal pleasantries of asking about their round of golf, my 'friend' asked about my day and I simply stated the sales were very slow and I'm very disgusted with the economy and 'those' in Washington. I should have remained on the other side of the bar for my 'friend's' next statemnt was "you can certainly blame this economic mess on Bush and those Republicans". Being the smart ass that I am, I asked him if he meant 41 or 43 to which there was no response, as he had no clue. Needless to say the conversation only went 'down hill' and, of course, I added to the fuel mixture by stating (in response to his anti-Bush statement) that I was a Constitutional Conservative with some Libertarian leanings. My 'friend' is a third generation Democrat (I'm a second) born and raised in Northeastern Ohio which is actually the point within this writing as it defines the lunacy of 'blue and red' thinking.
As I stated in my previous writing "there exists no true diversity of opinion, multiple ideological perspectives, creative thinking and decision making skills." I guess it also applies to older generations since (obviously) many believe that the politics of the 50's, 60's, 70's and very early 80's are the same today. They are ingrained with the thinking that Democarts are 'for the people' and Republicans are 'for the rich'. The facts however show that 'our' elected officials in Washington, whether 'blue or red', have no idea what it is to struggle with a small business, health care issues, balancing budgets, clueless as to what an income and balance sheet represents and further they don't care. Why would they? They have spent millions of dollars in getting elected which now guarantees them income (same income which they presently make even at one term in office) for the rest of their lives, a health care plan that is of no cost and delivers the very best of the medical field, no bugets to balance, and can raise OUR debt ceilings at will.
It seems to me that if one is to argue Politics, one ought to at least have some thoughts that are original and not part of the rhetoric concerning 'Democrats and Rebulicans' of today's ilk. I think one ought to acknowledge the fact that within Cabinet appintments made by President Obama that less than 8% of the appointments have prior private sector experience and that is the lowest in 100 years. Acknowledgement of facts as to increases in debt per administration or Tax plans as it pertains to payment of food stamps, health care, illegal immrigrants and the rest of the 'free stuff' since it will negatively affect those who actually work for a living and those that actually need assistance, medical or otherwise.
Or other facts:
* Federal spending highest since World War II
* Budget deficit highest since World War II
* Percentage of taxpayers paing income lowest in modern era
* Home ownership rate lowest since 1965
* Government dependency defined as the percentage of persons receiving one or more federal benefit payments highest in American history without accountability
Unfortunately Socialism has taken root and now producing seed; but who cares as long as government, 'Blue or Red', takes care of us and obviously knows what is best.
Back to my chilled 'Crown' not to be confused with 'clowns' who have taken up much too much of my drinking time.
After the normal pleasantries of asking about their round of golf, my 'friend' asked about my day and I simply stated the sales were very slow and I'm very disgusted with the economy and 'those' in Washington. I should have remained on the other side of the bar for my 'friend's' next statemnt was "you can certainly blame this economic mess on Bush and those Republicans". Being the smart ass that I am, I asked him if he meant 41 or 43 to which there was no response, as he had no clue. Needless to say the conversation only went 'down hill' and, of course, I added to the fuel mixture by stating (in response to his anti-Bush statement) that I was a Constitutional Conservative with some Libertarian leanings. My 'friend' is a third generation Democrat (I'm a second) born and raised in Northeastern Ohio which is actually the point within this writing as it defines the lunacy of 'blue and red' thinking.
As I stated in my previous writing "there exists no true diversity of opinion, multiple ideological perspectives, creative thinking and decision making skills." I guess it also applies to older generations since (obviously) many believe that the politics of the 50's, 60's, 70's and very early 80's are the same today. They are ingrained with the thinking that Democarts are 'for the people' and Republicans are 'for the rich'. The facts however show that 'our' elected officials in Washington, whether 'blue or red', have no idea what it is to struggle with a small business, health care issues, balancing budgets, clueless as to what an income and balance sheet represents and further they don't care. Why would they? They have spent millions of dollars in getting elected which now guarantees them income (same income which they presently make even at one term in office) for the rest of their lives, a health care plan that is of no cost and delivers the very best of the medical field, no bugets to balance, and can raise OUR debt ceilings at will.
It seems to me that if one is to argue Politics, one ought to at least have some thoughts that are original and not part of the rhetoric concerning 'Democrats and Rebulicans' of today's ilk. I think one ought to acknowledge the fact that within Cabinet appintments made by President Obama that less than 8% of the appointments have prior private sector experience and that is the lowest in 100 years. Acknowledgement of facts as to increases in debt per administration or Tax plans as it pertains to payment of food stamps, health care, illegal immrigrants and the rest of the 'free stuff' since it will negatively affect those who actually work for a living and those that actually need assistance, medical or otherwise.
Or other facts:
* Federal spending highest since World War II
* Budget deficit highest since World War II
* Percentage of taxpayers paing income lowest in modern era
* Home ownership rate lowest since 1965
* Government dependency defined as the percentage of persons receiving one or more federal benefit payments highest in American history without accountability
Unfortunately Socialism has taken root and now producing seed; but who cares as long as government, 'Blue or Red', takes care of us and obviously knows what is best.
Back to my chilled 'Crown' not to be confused with 'clowns' who have taken up much too much of my drinking time.
Thursday, August 01, 2013
Volume 77 (The Sabatical is over) Why is a generation of workforce/students a disappointment?
WOW! It's now been over two and half years since my last post. Amazing what happens over that period of time with the bigger question 'simply why write again'? What does one have to say that is so damn important as to write it down? The truth of the matter is 'nothing' and 'I don't know'. It's just therapy; a formulation of thoughts put to pen. So, after a couple of years the 'sabbatical is over; let's just jump!
To some this would be a most unusual question, since today we are under the impression that our 'kids' (last two generations actually) are the 'best and brightest.' They have grown up a digital society and can instinctively use, program, solve all types of electronic gadgetry. It isn't only the advancement of the digital age, our 'kids' now speak plainly of diversity of race, ethnicity, gender and sexual orientation. Our liberal sense of thinking gives us the illusion that we are advancing into higher and higher arenas of intellect and promise. Yet, we are sadly mistaken. Our present generation of workforce is far unqualified for such lofty thoughts of promise. Not only is our present generation a failure, the next generations could be worse.
Granted our 'kids' are wizards with the new electronic gadgets that hit the market everyday. Not only can these 'kids' buzz through multiple stages of the most complex computer games with hand-eye abilities never dreamed of, they are the most 'open-minded' generation to exist and can carry those discussions of diversity to certain limits of acceptance. Nevertheless, that is where the abilities stop and possibly where the problems start.
You see it is my theory that although all of the above is true especially when discussing certain abilities and discussions, there exists however no true diversity of opinion, multiple ideological perspectives, creative thinking and decision making skills. Our last two generations endless sensitivity to race, ethnicity, gender, sexual orientation and entitlements outstretches the desire or process for the development of innovative solutions to our problems be it national or local in nature; thus, we have processes upon process upon discussions never ending and no results.
Today's opinions, that do exist, come from genius marketers, advertising gurus, media experts and 'pitchmen' that make the 'snake oil doctor' look infantile. Their thought processes are influenced by instantaneous messaging, political correctness and entitlement (yes, using that word again) without any perspective of history and creativity solely based on a click of a device not a 'click' of brain thought prowess.
Is this because our educational system is less than adequate? Is it because we as educational students don't even rank in the the top twenty nations of the world in math and science? Is it because our workforce/students have no basis of history, even modern American history? Is it because we, as a nation, are so politically correct yet so ignorant of other countries and people (other than what our Media presents as fact)? I haven't any idea, just an old man writing for therapy.
To some this would be a most unusual question, since today we are under the impression that our 'kids' (last two generations actually) are the 'best and brightest.' They have grown up a digital society and can instinctively use, program, solve all types of electronic gadgetry. It isn't only the advancement of the digital age, our 'kids' now speak plainly of diversity of race, ethnicity, gender and sexual orientation. Our liberal sense of thinking gives us the illusion that we are advancing into higher and higher arenas of intellect and promise. Yet, we are sadly mistaken. Our present generation of workforce is far unqualified for such lofty thoughts of promise. Not only is our present generation a failure, the next generations could be worse.
Granted our 'kids' are wizards with the new electronic gadgets that hit the market everyday. Not only can these 'kids' buzz through multiple stages of the most complex computer games with hand-eye abilities never dreamed of, they are the most 'open-minded' generation to exist and can carry those discussions of diversity to certain limits of acceptance. Nevertheless, that is where the abilities stop and possibly where the problems start.
You see it is my theory that although all of the above is true especially when discussing certain abilities and discussions, there exists however no true diversity of opinion, multiple ideological perspectives, creative thinking and decision making skills. Our last two generations endless sensitivity to race, ethnicity, gender, sexual orientation and entitlements outstretches the desire or process for the development of innovative solutions to our problems be it national or local in nature; thus, we have processes upon process upon discussions never ending and no results.
Today's opinions, that do exist, come from genius marketers, advertising gurus, media experts and 'pitchmen' that make the 'snake oil doctor' look infantile. Their thought processes are influenced by instantaneous messaging, political correctness and entitlement (yes, using that word again) without any perspective of history and creativity solely based on a click of a device not a 'click' of brain thought prowess.
Is this because our educational system is less than adequate? Is it because we as educational students don't even rank in the the top twenty nations of the world in math and science? Is it because our workforce/students have no basis of history, even modern American history? Is it because we, as a nation, are so politically correct yet so ignorant of other countries and people (other than what our Media presents as fact)? I haven't any idea, just an old man writing for therapy.
Thursday, December 30, 2010
Volume 76 - Finally the End of 2010! ...or maybe not...
Within days, the pathetic year of 2010 will come to an end only to be put 'on the bookshelf' with its twin catastrophic sister of 2009; That's not 'pessimism' nor 'negativism' speaking it's simply stating the truth caused by a lack of understanding of our American History by people who legislate laws for this Great Country. As we know the Global economy went 'into the toilet' in 2008 due to Governmental errors by the Executive, Legislative and Judicial branches of Government in '07 and '08 with 'stupidity' on the increase through '09 and '10 with nothing on the horizon which makes me think 2011 will be much better unless and until we understand our history of the Declaration of Independence, the U.S. Constitution, the Bill of Rights and then re-institute the belief in those documents:
* Washington DC still is paralyzed and haven't a clue on what should be done for Small Business which employs 97% of working people; yet, violates Constitutional law by 'picking and choosing' 'the winners' be it Banks, Car Companies, Insurance Giants or Wall Street. They are still under the misunderstanding that 'they' have the right to 'bail-out' a selective part of 'business' in addition to promoting a health care program that no one wanted; doesn't serve the needs of the 'working' person or company; actually raises costs for small business; gives Government more control' over the individual; and finally will be run by bureaucrats, having a different Health Care Plan, who have the poorest record of group in running 'anything'!!!
*Washington DC and the 'Liberal Left' believe that our Constitution, Declaration of Independence and our Bill of Rights are some how outdated and was only applicable in the the 18th century.
* Washington DC has demagogued globalization for political gain, trying to blame all of our nation's economic trouble on trade, rather than on policy failures that are the true causes of our economic woes
* Washington DC has failed to address illegal immigration which has implications that reach far outside of California and Arizona that could infringe on our right to Bear Arms, as well as other Amendment ramifications.
On April 19th, 1775, Paul Revere departed Charlestown, Massachusetts for Lexington and Concord, in order to warn John Hancock, Samuel Adams and other Sons of Liberty that British regulars were coming to arrest them and seize their weapons caches. In the early dawn of that first Patriots Day, Captain John Parker, commander of the militiamen at Lexington, ordered, "Don't fire unless fired upon, but if they want a war let it begin here." And it did - American Minutemen fired the "shot heard round the world."
On July 6th, 1775, Thomas Jefferson and John Dickinson issued their Declaration of the Cause and Necessity of Taking up Arms: "With hearts fortified with these animating reflections, we most solemnly, before God and the world, declare, that, exerting the utmost energy of those powers, which our beneficent Creator hath graciously bestowed upon us, the arms we have been compelled by our enemies to assume, we will, in defiance of every hazard, with unabating firmness and perseverance employ for the preservation of our liberties; being with one mind resolved to die freemen rather than to live as slaves."
A year later in Philadelphia on July 4th, 1776, Jefferson and 55 merchants, farmers, doctors, lawyers and other representatives of the original 143 colonies of the United States of America, in the General Congress, assembled, pledged "our lives, our fortunes and our sacred honor" to the cause of liberty, declaring, "When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation."
Our Founders further avowed, "We hold these truths to be self-evident, that all mean are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness."
At the conclusion of the Revolutionary War, it was believed that the Articles of Confederation between the states, which had been adopted in 1777, were not sufficient to secure the interests of the confederation. Thus, delegates convened in Philadelphia in 1787 to draft a new Constitution.
Using the Virginia Plan drafted primarily by James Madison the delegates spent five months deliberating a constitutional draft, which would secure the rights and principles enumerated in the Declaration of Independence by establishing a republican form of government under strict rule of law, reflecting the consent of the people and severely limiting the power of the central government.
To secure these rights the Bill of Rights was established "in order to prevent misconstruction or abuse of powers..." Endeavoring to further define our Constitution's limits on government interference with the innate rights of the people, James Madison, its primary architect, introduced to the First Congress in 1789, a Bill of Rights - the first 10 Amendments to our Constitution, which was then ratified on the 15th of December, 1791.
This little touch on History is only a 'small onion peel' compared to the volumes of learning that is available; a time is our History that has been swept up with the onslaught of diversion to detract from the true meaning and intent of these magnificent documents. Today, more than two-thirds of the federal budget is spent on "objects of benevolence," for which there is no constitutional authority. Put another way, much of your income is being confiscated and redistributed unconstitutionally. As early as 1794, James Madison warned us and begun to rail against the government's unconstitutional urge to redistribute the wealth of its citizens: "I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending , on objects of benevolence, the money of their constituents...If Congress can do whatever in their discretion can be done by money, and will promote the General Welfare, the Government t is no longer a limited one, possessing enumerated powers, but an indefinite one, subject to particular exceptions."
Discussions of 'Entitlements' and how it has affected our last two generations of workforce is next on the agenda................... Com' On 2011!!!
* Washington DC still is paralyzed and haven't a clue on what should be done for Small Business which employs 97% of working people; yet, violates Constitutional law by 'picking and choosing' 'the winners' be it Banks, Car Companies, Insurance Giants or Wall Street. They are still under the misunderstanding that 'they' have the right to 'bail-out' a selective part of 'business' in addition to promoting a health care program that no one wanted; doesn't serve the needs of the 'working' person or company; actually raises costs for small business; gives Government more control' over the individual; and finally will be run by bureaucrats, having a different Health Care Plan, who have the poorest record of group in running 'anything'!!!
*Washington DC and the 'Liberal Left' believe that our Constitution, Declaration of Independence and our Bill of Rights are some how outdated and was only applicable in the the 18th century.
* Washington DC has demagogued globalization for political gain, trying to blame all of our nation's economic trouble on trade, rather than on policy failures that are the true causes of our economic woes
* Washington DC has failed to address illegal immigration which has implications that reach far outside of California and Arizona that could infringe on our right to Bear Arms, as well as other Amendment ramifications.
None of the above would even be discussed if our leaders understood our History and the meaning of 'limited government' as well as the beliefs that were so evident as our Great Country was founded and brought forth by individuals never again to be seen:
On December 16th, 1773, "radicals" from Marlborough, Massachusetts, threw 342 chests of tea from three British East India Company ships into Boston Harbor in protest of oppressive taxation and tyrannical rule. They wrote of their actions, "A free-born people are not required by the religion of Christ to submit to tyranny, but may make use of such power as God has given them to recover and support their...liberties." That event was the Boston Tea Party.
On April 19th, 1775, Paul Revere departed Charlestown, Massachusetts for Lexington and Concord, in order to warn John Hancock, Samuel Adams and other Sons of Liberty that British regulars were coming to arrest them and seize their weapons caches. In the early dawn of that first Patriots Day, Captain John Parker, commander of the militiamen at Lexington, ordered, "Don't fire unless fired upon, but if they want a war let it begin here." And it did - American Minutemen fired the "shot heard round the world."
On July 6th, 1775, Thomas Jefferson and John Dickinson issued their Declaration of the Cause and Necessity of Taking up Arms: "With hearts fortified with these animating reflections, we most solemnly, before God and the world, declare, that, exerting the utmost energy of those powers, which our beneficent Creator hath graciously bestowed upon us, the arms we have been compelled by our enemies to assume, we will, in defiance of every hazard, with unabating firmness and perseverance employ for the preservation of our liberties; being with one mind resolved to die freemen rather than to live as slaves."
A year later in Philadelphia on July 4th, 1776, Jefferson and 55 merchants, farmers, doctors, lawyers and other representatives of the original 143 colonies of the United States of America, in the General Congress, assembled, pledged "our lives, our fortunes and our sacred honor" to the cause of liberty, declaring, "When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation."
Our Founders further avowed, "We hold these truths to be self-evident, that all mean are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness."
At the conclusion of the Revolutionary War, it was believed that the Articles of Confederation between the states, which had been adopted in 1777, were not sufficient to secure the interests of the confederation. Thus, delegates convened in Philadelphia in 1787 to draft a new Constitution.
Using the Virginia Plan drafted primarily by James Madison the delegates spent five months deliberating a constitutional draft, which would secure the rights and principles enumerated in the Declaration of Independence by establishing a republican form of government under strict rule of law, reflecting the consent of the people and severely limiting the power of the central government.
To secure these rights the Bill of Rights was established "in order to prevent misconstruction or abuse of powers..." Endeavoring to further define our Constitution's limits on government interference with the innate rights of the people, James Madison, its primary architect, introduced to the First Congress in 1789, a Bill of Rights - the first 10 Amendments to our Constitution, which was then ratified on the 15th of December, 1791.
This little touch on History is only a 'small onion peel' compared to the volumes of learning that is available; a time is our History that has been swept up with the onslaught of diversion to detract from the true meaning and intent of these magnificent documents. Today, more than two-thirds of the federal budget is spent on "objects of benevolence," for which there is no constitutional authority. Put another way, much of your income is being confiscated and redistributed unconstitutionally. As early as 1794, James Madison warned us and begun to rail against the government's unconstitutional urge to redistribute the wealth of its citizens: "I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending , on objects of benevolence, the money of their constituents...If Congress can do whatever in their discretion can be done by money, and will promote the General Welfare, the Government t is no longer a limited one, possessing enumerated powers, but an indefinite one, subject to particular exceptions."
Discussions of 'Entitlements' and how it has affected our last two generations of workforce is next on the agenda................... Com' On 2011!!!
Monday, November 15, 2010
Volume 75 - Where Are We Heading...?
It's the middle of the 4th Quarter (2010) and a good time to ask the 'big' question:
Where are We Heading as a Nation?
Economically speaking, as the Managing Partner & Founder of a small business the outlook is not very good. There are no 'indicators' on my radar screen showing any type of improvement in the foreseeable future. The Price of Gold has reached new levels never before seen, with some predictions pushing the $5,000 an ounce ceiling; but (possibly) more important is the Price of Silver which has climb to not only record levels but levels that were deemed improbable with no new ceiling in site. These two factors alone point out the Global Disaster 'sitting' in the wings.
Here's why:
1. Small business employs 97% of the working American workforce. Small business exists because historically they were able to borrow money and acquire lines of credit. Notice the word 'historically' - Today, that is simply not the case. Banks are not lending money and have cut deeply into any 'lines of credit' that were once available; yet, the Federal Government and this Administration simply just 'don't get it'! Why? Take the last bill signed by President Obama that supposedly gave 'small business' $30-billion in a lending bill. Where did the money go? It went to the Banks, earmarked for small community banks (right!) This administration 'hopes' that by going to somebody else that it may eventually get to the Small Business community; another 'Wizard of Oz' concept. As stated by Brian Miller, the President and COO of 'The Entrepreneur's Source, "If it does not (get into the hands of small business owners quickly) and we're faced with the same kind of situation that we were with TARP, where the banks just sit on the money and they don't get it in the hands of people that need it, then it's going to be a colossal failure."
2. The Federal Deposit Insurance Corp. (FDIC) announced that U.S. bank failures in 2010 were double the bank failures of 2009. The FDIC reported that another 702 banks ere nearing collapse. This same FDIC reports a negative balance of over $20 Billion dollars.
3. The US is experiencing the worst unemployment rate in 125 years and October job losses were the biggest in 34 years.
4. The rate of foreclosures thus far in 2010 exceed 2009 by an 80% increase.
5. Immigration analysts project another 100 million people flooding America within the next 25 years with 70 million of these 'new' Americans will be third world immigrants and their children with over half being 'illegals' as our Government is unable or unwilling to take the correct stand on immigration policies, procedures and enforcement.
6. There are now over 40 million Americans (one out of seven Americans), according to Government reports, living in poverty.
7. High Schools across this country are experiencing drop out rates of nearly 50%.
8. The U.S. ranks 18th and 24th in Math and Science on the World Stage with the majority of Math and Science Graduate Degrees going to non-Americans within our Graduate Schools.
8. We have 500,000 military personnel located on 700 military bases in 120 countries.
9. We have keep 35,000 troops at our expense on the Demilitarized Zone in South Korea for the past 50 years.
10. We are spending over 150 billion per year in Iraq and Afghanistan.
11. Our National Debt is now over 13 TRILLION Dollars
Because of the Mid-Term Election and the Declaration of the American People for directional change, the Republicans return to power in the House; however, this has happened in our History before, so (as the saying goes) We'll See................................
Where are We Heading as a Nation?
Economically speaking, as the Managing Partner & Founder of a small business the outlook is not very good. There are no 'indicators' on my radar screen showing any type of improvement in the foreseeable future. The Price of Gold has reached new levels never before seen, with some predictions pushing the $5,000 an ounce ceiling; but (possibly) more important is the Price of Silver which has climb to not only record levels but levels that were deemed improbable with no new ceiling in site. These two factors alone point out the Global Disaster 'sitting' in the wings.
Here's why:
1. Small business employs 97% of the working American workforce. Small business exists because historically they were able to borrow money and acquire lines of credit. Notice the word 'historically' - Today, that is simply not the case. Banks are not lending money and have cut deeply into any 'lines of credit' that were once available; yet, the Federal Government and this Administration simply just 'don't get it'! Why? Take the last bill signed by President Obama that supposedly gave 'small business' $30-billion in a lending bill. Where did the money go? It went to the Banks, earmarked for small community banks (right!) This administration 'hopes' that by going to somebody else that it may eventually get to the Small Business community; another 'Wizard of Oz' concept. As stated by Brian Miller, the President and COO of 'The Entrepreneur's Source, "If it does not (get into the hands of small business owners quickly) and we're faced with the same kind of situation that we were with TARP, where the banks just sit on the money and they don't get it in the hands of people that need it, then it's going to be a colossal failure."
2. The Federal Deposit Insurance Corp. (FDIC) announced that U.S. bank failures in 2010 were double the bank failures of 2009. The FDIC reported that another 702 banks ere nearing collapse. This same FDIC reports a negative balance of over $20 Billion dollars.
3. The US is experiencing the worst unemployment rate in 125 years and October job losses were the biggest in 34 years.
4. The rate of foreclosures thus far in 2010 exceed 2009 by an 80% increase.
5. Immigration analysts project another 100 million people flooding America within the next 25 years with 70 million of these 'new' Americans will be third world immigrants and their children with over half being 'illegals' as our Government is unable or unwilling to take the correct stand on immigration policies, procedures and enforcement.
6. There are now over 40 million Americans (one out of seven Americans), according to Government reports, living in poverty.
7. High Schools across this country are experiencing drop out rates of nearly 50%.
8. The U.S. ranks 18th and 24th in Math and Science on the World Stage with the majority of Math and Science Graduate Degrees going to non-Americans within our Graduate Schools.
8. We have 500,000 military personnel located on 700 military bases in 120 countries.
9. We have keep 35,000 troops at our expense on the Demilitarized Zone in South Korea for the past 50 years.
10. We are spending over 150 billion per year in Iraq and Afghanistan.
11. Our National Debt is now over 13 TRILLION Dollars
Because of the Mid-Term Election and the Declaration of the American People for directional change, the Republicans return to power in the House; however, this has happened in our History before, so (as the saying goes) We'll See................................
Tuesday, September 21, 2010
Volume 74 - Four Key Components for Success
While preparing for my recent business trip to Memphis, I put together notes from a decade ago concerning changes at a major Hollow Metal Manufacturer as well as a 'distribution center' concept, since one of my meetings this coming week is 'distribution center' oriented. In reviewing my notes, letters, and outlines for the restructuring of a large Los Angeles Distribution Center it became very clear to me that the Four Major ingredients that I proposed many years ago are truer than ever today and not only apply to a restructure deal but apply to business in general; therefore, worth my 'blog' submittal.
Although these Four Major ingredients or Key Components were first established to clarify and to effectively 'change' the 'front-end' of a major hollow metal manufacturer and subsequently were used to 'change' a large distribution center, a revenue stream of the same hollow metal manufacturer, they are as applicable today as they were successful a decade ago. So whether they are used for a 'total restructure mandate' or simply used to tighten up a companies controls, procedures and quality of personnel or (as in the case of the distribution center) to elevate it to a much more effective facility, with quick ship manufacturing, wood doors, packaged hardware, and joint ventures concepts, the Four Key Components remain the same.
A few months before I took over the Presidency of Amweld (mid-1995), I realized that there were some major changes that had to take place if we were going to be able to handle the internal growth that I had projected through the Sales Department. Having control over Sales and Customer Service and LADC, it was logical that these changes had to be made with or without the input of other divisions within the company, as we all know 'manufacturing people' and 'financial people' live in their own small tightly woven world. Even though under my control, Sales, Customer Service and LADC did not embrace the idea of change, common within most manufacturing based facilities; nevertheless, this was not an option nor was it up for debate.
There had to be a 'reorganization' of the front-end of Amweld Building Products. There had to be a specific plan to reduce 'past dues' (which is the complete opposite of 100% complete and on-time) and at the same time work within the guidelines of a new detailed 'lead-time' document which would tie into the 'front-end' reorganization; at the same time, identifying the 'capability' and 'capacity' in our factories working under present manpower and shifts.
During initial discussions we accomplished two vital objectives: 1. To re-examine and restate the company's business purpose and focus; and 2. to use this purpose to localize people for change. We then proceeded to implement this same 'change' at LADC for we had reached a 'cross-road' (at that facility) and had to decide where we wanted to go.
Did we want to keep it at a four million dollar facility (after growing it from 1) and simply tighten up its controls, procedures and quality of personnel, or do we want to elevate it again to double the sales output with quick ship manufacturing, wood doors, packaged hardware, etc. or something in-between? We made our decision and proceeded with the four key ingredients that I believe are applicable to any business facing a 'cross-road'. These ingredients are not compatible with a 'structured' organization where all decisions run 'down-hill' and decisions are made by 'consensus' (automatic losing situation):
1. The belief that there is a single right way to do everything. Rather, we must keep up with changes in the market place and continuously go after better solutions. There is no single right way to do anything. This is even more prevalent in a distribution center twenty-five hundred miles away where they are dealing with a quicker lead-time/response schedule, stock shipping in hours and fabricated special orders shipped in small weekly schedules, and changes in over-the-counter sales.
2. The sense that authority is tied to an organizational chart. Rather, authority should be distributed among those who can do a better job for the customer. One of the reasons that LADC did not function previous to 1988 is the simple fact that they (LADC) was totally controlled from Ohio by more than one individual. In a service orientated facility 2500 hundred miles away from the corporate office this type of control cannot take place. Autonomy becomes an important key to its success regardless of who has final authority.
3. The view that the value of everything you do must be measured in dollars. Rather, the true value of an activity only counts in what it is worth to the customer. Again, this becomes more important for LADC/GVDC type operations because they are dealing with the customer, a back log that fluctuates hourly, short lead times, stock and non-stock and over the counter sales that make up 50% of the business within four counties (LA).
4. The idea that people have one skill, departments have a single function, and an enterprise has one goal. Rather, we must think in terms of multiskilled people, mutitasked teams, and the all goal enterprise. This speaks for itself. Anytime you have a satellite operation you have individuals doing multitasked functions. They must be able to respond both to vendors and to customers on an immediate basis without going through a long chain of command, especially when there is a three hour time difference and they only have so many hours to 0perate. We never totally understood that simple idea at Amweld; the fact that LADC is our single largest customer (and revenue stream) of the home office. We have had an antagonistic point of view toward that facility, whether it comes from the general sales area, the accounting department or the manufacturing facility.
There are many more layers of the 'onion' to 'peel back' to accomplish the above stated task. Many months were put into 'planners', structured 'payables', staff upgrades, duties and responsibilities, training, flexible stocking programs, reduced fabricating lead-times, sales volume and forecasts, operational daily-weekly-monthly reports, change of 'mind-set', etc. etc. It has been and is now my belief that Market Share and Profitability can be obtained in a satellite operation with Service being the main pillar of stability backed up by a variety of product flexibility integrated with speed, cost effectiveness and total integration with an overall corporate purpose.
One doesn't have to agree with any of the above, as most manufacturing guru's will attest; but the fact that very few successful companies grasp this concept is proven out by the constant closing of satellite operations as well as the loss of manufacturing capabilities within this country. Don't blame foreign countries for taking manufacturing jobs, don't even blame stupid Congress or the Local politicians; rather, look within ones own (manufacturing or distribution) make-up to find the correct blame.
Although these Four Major ingredients or Key Components were first established to clarify and to effectively 'change' the 'front-end' of a major hollow metal manufacturer and subsequently were used to 'change' a large distribution center, a revenue stream of the same hollow metal manufacturer, they are as applicable today as they were successful a decade ago. So whether they are used for a 'total restructure mandate' or simply used to tighten up a companies controls, procedures and quality of personnel or (as in the case of the distribution center) to elevate it to a much more effective facility, with quick ship manufacturing, wood doors, packaged hardware, and joint ventures concepts, the Four Key Components remain the same.
A few months before I took over the Presidency of Amweld (mid-1995), I realized that there were some major changes that had to take place if we were going to be able to handle the internal growth that I had projected through the Sales Department. Having control over Sales and Customer Service and LADC, it was logical that these changes had to be made with or without the input of other divisions within the company, as we all know 'manufacturing people' and 'financial people' live in their own small tightly woven world. Even though under my control, Sales, Customer Service and LADC did not embrace the idea of change, common within most manufacturing based facilities; nevertheless, this was not an option nor was it up for debate.
There had to be a 'reorganization' of the front-end of Amweld Building Products. There had to be a specific plan to reduce 'past dues' (which is the complete opposite of 100% complete and on-time) and at the same time work within the guidelines of a new detailed 'lead-time' document which would tie into the 'front-end' reorganization; at the same time, identifying the 'capability' and 'capacity' in our factories working under present manpower and shifts.
During initial discussions we accomplished two vital objectives: 1. To re-examine and restate the company's business purpose and focus; and 2. to use this purpose to localize people for change. We then proceeded to implement this same 'change' at LADC for we had reached a 'cross-road' (at that facility) and had to decide where we wanted to go.
Did we want to keep it at a four million dollar facility (after growing it from 1) and simply tighten up its controls, procedures and quality of personnel, or do we want to elevate it again to double the sales output with quick ship manufacturing, wood doors, packaged hardware, etc. or something in-between? We made our decision and proceeded with the four key ingredients that I believe are applicable to any business facing a 'cross-road'. These ingredients are not compatible with a 'structured' organization where all decisions run 'down-hill' and decisions are made by 'consensus' (automatic losing situation):
1. The belief that there is a single right way to do everything. Rather, we must keep up with changes in the market place and continuously go after better solutions. There is no single right way to do anything. This is even more prevalent in a distribution center twenty-five hundred miles away where they are dealing with a quicker lead-time/response schedule, stock shipping in hours and fabricated special orders shipped in small weekly schedules, and changes in over-the-counter sales.
2. The sense that authority is tied to an organizational chart. Rather, authority should be distributed among those who can do a better job for the customer. One of the reasons that LADC did not function previous to 1988 is the simple fact that they (LADC) was totally controlled from Ohio by more than one individual. In a service orientated facility 2500 hundred miles away from the corporate office this type of control cannot take place. Autonomy becomes an important key to its success regardless of who has final authority.
3. The view that the value of everything you do must be measured in dollars. Rather, the true value of an activity only counts in what it is worth to the customer. Again, this becomes more important for LADC/GVDC type operations because they are dealing with the customer, a back log that fluctuates hourly, short lead times, stock and non-stock and over the counter sales that make up 50% of the business within four counties (LA).
4. The idea that people have one skill, departments have a single function, and an enterprise has one goal. Rather, we must think in terms of multiskilled people, mutitasked teams, and the all goal enterprise. This speaks for itself. Anytime you have a satellite operation you have individuals doing multitasked functions. They must be able to respond both to vendors and to customers on an immediate basis without going through a long chain of command, especially when there is a three hour time difference and they only have so many hours to 0perate. We never totally understood that simple idea at Amweld; the fact that LADC is our single largest customer (and revenue stream) of the home office. We have had an antagonistic point of view toward that facility, whether it comes from the general sales area, the accounting department or the manufacturing facility.
There are many more layers of the 'onion' to 'peel back' to accomplish the above stated task. Many months were put into 'planners', structured 'payables', staff upgrades, duties and responsibilities, training, flexible stocking programs, reduced fabricating lead-times, sales volume and forecasts, operational daily-weekly-monthly reports, change of 'mind-set', etc. etc. It has been and is now my belief that Market Share and Profitability can be obtained in a satellite operation with Service being the main pillar of stability backed up by a variety of product flexibility integrated with speed, cost effectiveness and total integration with an overall corporate purpose.
One doesn't have to agree with any of the above, as most manufacturing guru's will attest; but the fact that very few successful companies grasp this concept is proven out by the constant closing of satellite operations as well as the loss of manufacturing capabilities within this country. Don't blame foreign countries for taking manufacturing jobs, don't even blame stupid Congress or the Local politicians; rather, look within ones own (manufacturing or distribution) make-up to find the correct blame.
Monday, September 13, 2010
Volume 73 - Health Care Bill -Enough!
As I stated in Volume 72, I've run out of the patience to dig through this piece of Bureaucratic Bullshit legislation, even if it's simply delivering the translation by way of our International Law Firm.
But it just 'pisses me off' that we Americans told our lawmakers in Washington that we wanted 'reforms' that would LOWER costs; that we wanted to insure those social programs that made sense, such as protecting Medicare; that we wanted to keep the health plans that we had but wanted reform to the prescription side of the equation as well as some 'common sense' applied to the coverages offered protecting us from the giant Health Care Companies and Pharmaceutical Companies taking advantage of us both from a extreme profit standpoint and exclusionary standpoint.
BUT WHAT DID WE GET: We got legislation from an Administration pitching this health spending bill that can't be paid for without stealing billions of dollars from Medicare; does nothing to LOWER present costs but will actually encourage the Health Care Companies to raise premiums. It does nothing to reduce prescription costs, simply encourages more prescriptions to be imported into this country. It encourages the Health Care Giants to be more exclusionary and to 'legal-ease' their programs so that denial can occur at their choosing.
We, as Americans, argued strenuously against its passage at every opportunity. We offered detailed reasons for our opposition, along with common-sense alternative reforms aimed at lowering the cost of health care while yet providing access without undermining the system that we had and for all of our efforts these same lawmakers in Washington persisted to pass this 'garbage' bill. A bill that will ultimately cost jobs as employers reduce benefits and cut jobs simply to 'make ends meet'.
I believe it is time for our lawmakers in Washington to understand that the working public, the entrepreneur, the small business person, the second and third generation of LEGAL immigrants are sick and tired of carrying those that take advantage of a system that has become so Socialized, so addicting, so anti-business, so non-accountable that it actually encourages people to do nothing because the government will take care of you. Bullshit!
But it just 'pisses me off' that we Americans told our lawmakers in Washington that we wanted 'reforms' that would LOWER costs; that we wanted to insure those social programs that made sense, such as protecting Medicare; that we wanted to keep the health plans that we had but wanted reform to the prescription side of the equation as well as some 'common sense' applied to the coverages offered protecting us from the giant Health Care Companies and Pharmaceutical Companies taking advantage of us both from a extreme profit standpoint and exclusionary standpoint.
BUT WHAT DID WE GET: We got legislation from an Administration pitching this health spending bill that can't be paid for without stealing billions of dollars from Medicare; does nothing to LOWER present costs but will actually encourage the Health Care Companies to raise premiums. It does nothing to reduce prescription costs, simply encourages more prescriptions to be imported into this country. It encourages the Health Care Giants to be more exclusionary and to 'legal-ease' their programs so that denial can occur at their choosing.
We, as Americans, argued strenuously against its passage at every opportunity. We offered detailed reasons for our opposition, along with common-sense alternative reforms aimed at lowering the cost of health care while yet providing access without undermining the system that we had and for all of our efforts these same lawmakers in Washington persisted to pass this 'garbage' bill. A bill that will ultimately cost jobs as employers reduce benefits and cut jobs simply to 'make ends meet'.
I believe it is time for our lawmakers in Washington to understand that the working public, the entrepreneur, the small business person, the second and third generation of LEGAL immigrants are sick and tired of carrying those that take advantage of a system that has become so Socialized, so addicting, so anti-business, so non-accountable that it actually encourages people to do nothing because the government will take care of you. Bullshit!
Sunday, September 12, 2010
Volume 72 - Health Care Bill - 3nd in Series
Health Care Reform: Grandfathering Rules and Plan Design Changes as prepared by i.2 Independence2, LLC's International Law Firm Calfee, Halter & Griswold, LLP.
This third in a series "highlights potential pitfalls under health care reform for employers considering changes to their group health plans. Any employer considering plan changes, including design changes as a way to decrease the cost of coverage before open enrollment, should evaluate the changes against requirements to maintain 'grandfathered' status under recently released regulations. Failure to maintain grandfaathered status can have signficant ramifications for employers.
Grandfathered status and its significance
Any group health plan in which an idividual was enrolled on March 23, 2010, (the law's enactment date) and which has continuaously covered an individual since this date is 'grandfathered' under the new law. This means that the plan may avoid or delay the application of some potentially burdensome requirements under the new law. These requirements include:
> nondiscrimination rules for insured plans;
> external claims review requiarements;
> additional coverage requirements such as immunization or preventive care without cost sharing;
> the extension of coverage to a child under age 26 prior to 2014 even if the child is covered under his or her employer's plan; and
> the elimination of preexisting conditions exclusions for individuals age 19 or older.
Loss of grandfathered status
Prior to the issuance of the regulations, we knew that a plan's grandfathered status would not be lost for any of the following reasons:
> participants' family members enroll in the plan upon reneewal pursuant to the plan's terms as of March 23, 2010;
> new employees and their family members enroll in the plan; or
> the plan extends dependent coverage to age 26, as required by the law.
It was not clear, however, whether certain changes would be significant enough to cause the loss of grandfathered status. The regulations prove much needed guidance about changes that trigger a loss of grandfathered status.
Under the regulations, a plan will lose its grandfathered status if:
> Employer contribution - The employer contribution rate for any tier of coverage (e.g. single, family) is reduced by more than five percentage points below the contribution rate in effect on March 23, 2010. For self-insured plans, contributions by an employer are equal to the total cost of coverage minus the employee contributions for the coverage.
> Percentage cost-sharing - A percentage cost-sharing requirement (e.g. coinsurance percentage) is increased from the plan's requirement as of March 23, 2010.
> Fixed amount cost-sharing - A fixed-amount cost-sharing requirement other than a copayment (e.g. deductible, out-of-pocket maximum) is increased by more than 15% from the plan's requirement in effect on March 23, 2010, as adjusted for medical inflation.
> Copay - A copay is increased from the paln's March 23, 2010, copay by more than the greater of: (1) $5 or (2) 15% as adjusted for medical inflation.
> Annual Dollar Limit
An annual dollar limit in place on March 23, 2010, is reduced
> New policy
A new insurance policy replaces an existing policy after March 23, 2010, (e.g. prior insurance policy is not renewed).
> Particular condition
Benefits for a particular condition are eliminated. This includes the elimination of a necessary element to diagnose or treat a condition.
The regulations provide that grandfathered status is available to each benefit package provided under a group health plan. Thus, if a single plan provides two or more medical plan options and a new policy of Insurance is obtained for only one option, then only the option covered by the new policy will lose grandfathered status.
As you can easily tell from this and the past two postings that the Health Care Reform Act is anything but 'reform'!
It should be noted that Calfee goes on with three more articles relating to this Health Care Reform, one actually starting with an effective date of March 23, 2010 and extending to January 1, 2014 giving not only the effective dates but also the 'Description' and 'Employer Considerations'. I simply don't have the patience to continue with this piece of Bureaucratic Bullshit legislation!
This third in a series "highlights potential pitfalls under health care reform for employers considering changes to their group health plans. Any employer considering plan changes, including design changes as a way to decrease the cost of coverage before open enrollment, should evaluate the changes against requirements to maintain 'grandfathered' status under recently released regulations. Failure to maintain grandfaathered status can have signficant ramifications for employers.
Grandfathered status and its significance
Any group health plan in which an idividual was enrolled on March 23, 2010, (the law's enactment date) and which has continuaously covered an individual since this date is 'grandfathered' under the new law. This means that the plan may avoid or delay the application of some potentially burdensome requirements under the new law. These requirements include:
> nondiscrimination rules for insured plans;
> external claims review requiarements;
> additional coverage requirements such as immunization or preventive care without cost sharing;
> the extension of coverage to a child under age 26 prior to 2014 even if the child is covered under his or her employer's plan; and
> the elimination of preexisting conditions exclusions for individuals age 19 or older.
Loss of grandfathered status
Prior to the issuance of the regulations, we knew that a plan's grandfathered status would not be lost for any of the following reasons:
> participants' family members enroll in the plan upon reneewal pursuant to the plan's terms as of March 23, 2010;
> new employees and their family members enroll in the plan; or
> the plan extends dependent coverage to age 26, as required by the law.
It was not clear, however, whether certain changes would be significant enough to cause the loss of grandfathered status. The regulations prove much needed guidance about changes that trigger a loss of grandfathered status.
Under the regulations, a plan will lose its grandfathered status if:
> Employer contribution - The employer contribution rate for any tier of coverage (e.g. single, family) is reduced by more than five percentage points below the contribution rate in effect on March 23, 2010. For self-insured plans, contributions by an employer are equal to the total cost of coverage minus the employee contributions for the coverage.
> Percentage cost-sharing - A percentage cost-sharing requirement (e.g. coinsurance percentage) is increased from the plan's requirement as of March 23, 2010.
> Fixed amount cost-sharing - A fixed-amount cost-sharing requirement other than a copayment (e.g. deductible, out-of-pocket maximum) is increased by more than 15% from the plan's requirement in effect on March 23, 2010, as adjusted for medical inflation.
> Copay - A copay is increased from the paln's March 23, 2010, copay by more than the greater of: (1) $5 or (2) 15% as adjusted for medical inflation.
> Annual Dollar Limit
An annual dollar limit in place on March 23, 2010, is reduced
> New policy
A new insurance policy replaces an existing policy after March 23, 2010, (e.g. prior insurance policy is not renewed).
> Particular condition
Benefits for a particular condition are eliminated. This includes the elimination of a necessary element to diagnose or treat a condition.
The regulations provide that grandfathered status is available to each benefit package provided under a group health plan. Thus, if a single plan provides two or more medical plan options and a new policy of Insurance is obtained for only one option, then only the option covered by the new policy will lose grandfathered status.
As you can easily tell from this and the past two postings that the Health Care Reform Act is anything but 'reform'!
It should be noted that Calfee goes on with three more articles relating to this Health Care Reform, one actually starting with an effective date of March 23, 2010 and extending to January 1, 2014 giving not only the effective dates but also the 'Description' and 'Employer Considerations'. I simply don't have the patience to continue with this piece of Bureaucratic Bullshit legislation!
Sunday, August 01, 2010
Volume 71 - Health Care Bill - 2nd in Series
Health Care Reform: Intermediate Range Impact on Employers and Group Health Plans (as presented by the i.2 International Law Firm of Calfee.
"Each day we learn more about how the health care reform law impacs businesses and their employees. This First Alert focuses on those porvisions of the law that become effective in 2012 and 2013 and provides highlights of newly released guidance about the small employer tax credit, the taxability of health care coverage for adult children and the early retiree reinsurance program. Longer-term impacts will be discussed in future First Alerts" (Calfee on-line News Letter).
Items that become effective in 2012 and 2013
* W-2 Reporting
"Effective for taxable years beginning after December 31, 2010, the cost of employer-sponsored health coverage must be included on each employee's W-2 form. Since W-2 forms generally must be porvided to employees by January 31 of the year following the year of payment, the value of employer-sponsored health coverage must first be reflected on the W-2 forms due by january 31, 2012.
* Explanation of Coverage
Beginning in 2012, health insurers and sponsors of self-insured group health plans must porvide a uniform summary of benefits to applicants and enrollees. This summary, which cannot exceed four pages, must describe benefits and cost-sharing provisions such as deductibles, co-payments and coinsurance, as well as renewability and continuation of coverage provisions; it is in addition to the summary plan description. If there is a material modification to the terms of a plan or coverage, insurers and sponsors must notify enrollees at least 60 days before the change will become effective.
*Notice Requirement
By March 1, 2013, employers must porvide employees a written notice that informs employees of the existence of health insurance exchanges, the availability of premium tax credits and cost-sharing reductions. Employers also must include in the written notice the possible loss of employer contributions (if any) toward any health benefit plan offered by the employer if employees obtain coverage through exchanges.
* Per Participant Fee
In 2013, sponsors of self-insured group health plans must pay a tax of $1 per participant to help fund comparative clinical effectiveness research. In 2014, this tax increases to $2 per participant and can increase annually thereafter based on a specified formula. Insurers must pay the fee for insured plans.
*Cap for HFSAs
for tax years beginning on and after January 1, 2013, annual health fexible spending arrangement contributions will be limited to $2,500 per employee. This cap is indexed for inflation. Currently, there is no legally mandated limit.
Updates and new information items
> Small Business Health Care Tax Credit
The government has issued guidance about how to claim the small business health care tax credit. The guidance provides rules for the calculation of full-time equivalent employees (may not exceed 25 to be eligible for the credit) and approves the use of certain equivalencies for hours of service used for the calculation of the number of full-time equivalent employees and for the calculation of average annual wages (which may not exceed $50,000 to be eligible for the credit). Receipt of state credits and subisdies will not affect eligibility for the federal credit but may reduce the amount of the federal credit. The requirement that an employer pay a unifirm percentage of employees premiums is effectively modified for 2010; an employer will be deemed to pay at least 50% of the premiu for an employee if it pays 50% of the premium for single (employee-only) coverage for 2010.
> Health Coverage for Adult Children
Plans must provide a 30-day special enrollment opportunity for all children uder age 26 by the first day of the first plan year beginning on or after September 23, 2010. This date will be January 1, 2011, for calendar year plans. The special enrollment must include a written notice of the opportunity to enroll and the coverage must begin by the first day of the plan year. Terms of the coverage for adult children, including premium rates, cannot vary based on age. The IRS has confirmed that both coverage under and payments from a plan providing coverage to an adult child that has not attained age 27 in a taxable year do not result in taxable income. Employers may immediately permit employees to make pre-tax salary reduction contributions for health insurance coverage under a cafeteria plan and health flexivle spending arrangement for adult children under age 27 during the taxable year. However, retroactive amendments to plan documents reflecting this change must be made by December 31, 2010.
> Reinsurance Program for Early Retiree Medical Coverage
Finally, the government has issued rules for the early retiree medical coverage reinsurance program. The program will become effective on June 1, 2010 and last through 2013. Applications for participation will be processed on a first come, first served basis. Since a finite amount of funds ($5 billion) have been earmarked for this program, interested employers should act very quickly. Although applications for participation are not expected to be available until late June, the information required to complete an application is listed in the new rules, so employers can start gathering the information now.
Reimbursement payments must be used to reduce the sponsor's health benefit premiums or health benefit costs or reduce health care costs for retired or active participants (e.g. premium contributions, co-payments, deductibles, coinsurance or other out-of-pocket costs. However, a sponsor must 'provide at least the same level of contribution to support' their plans. So it appears that the primary benefit of the program for plan sponsors will be to keep their premium and cost at current level."
God help us!
"Each day we learn more about how the health care reform law impacs businesses and their employees. This First Alert focuses on those porvisions of the law that become effective in 2012 and 2013 and provides highlights of newly released guidance about the small employer tax credit, the taxability of health care coverage for adult children and the early retiree reinsurance program. Longer-term impacts will be discussed in future First Alerts" (Calfee on-line News Letter).
Items that become effective in 2012 and 2013
* W-2 Reporting
"Effective for taxable years beginning after December 31, 2010, the cost of employer-sponsored health coverage must be included on each employee's W-2 form. Since W-2 forms generally must be porvided to employees by January 31 of the year following the year of payment, the value of employer-sponsored health coverage must first be reflected on the W-2 forms due by january 31, 2012.
* Explanation of Coverage
Beginning in 2012, health insurers and sponsors of self-insured group health plans must porvide a uniform summary of benefits to applicants and enrollees. This summary, which cannot exceed four pages, must describe benefits and cost-sharing provisions such as deductibles, co-payments and coinsurance, as well as renewability and continuation of coverage provisions; it is in addition to the summary plan description. If there is a material modification to the terms of a plan or coverage, insurers and sponsors must notify enrollees at least 60 days before the change will become effective.
*Notice Requirement
By March 1, 2013, employers must porvide employees a written notice that informs employees of the existence of health insurance exchanges, the availability of premium tax credits and cost-sharing reductions. Employers also must include in the written notice the possible loss of employer contributions (if any) toward any health benefit plan offered by the employer if employees obtain coverage through exchanges.
* Per Participant Fee
In 2013, sponsors of self-insured group health plans must pay a tax of $1 per participant to help fund comparative clinical effectiveness research. In 2014, this tax increases to $2 per participant and can increase annually thereafter based on a specified formula. Insurers must pay the fee for insured plans.
*Cap for HFSAs
for tax years beginning on and after January 1, 2013, annual health fexible spending arrangement contributions will be limited to $2,500 per employee. This cap is indexed for inflation. Currently, there is no legally mandated limit.
Updates and new information items
> Small Business Health Care Tax Credit
The government has issued guidance about how to claim the small business health care tax credit. The guidance provides rules for the calculation of full-time equivalent employees (may not exceed 25 to be eligible for the credit) and approves the use of certain equivalencies for hours of service used for the calculation of the number of full-time equivalent employees and for the calculation of average annual wages (which may not exceed $50,000 to be eligible for the credit). Receipt of state credits and subisdies will not affect eligibility for the federal credit but may reduce the amount of the federal credit. The requirement that an employer pay a unifirm percentage of employees premiums is effectively modified for 2010; an employer will be deemed to pay at least 50% of the premiu for an employee if it pays 50% of the premium for single (employee-only) coverage for 2010.
> Health Coverage for Adult Children
Plans must provide a 30-day special enrollment opportunity for all children uder age 26 by the first day of the first plan year beginning on or after September 23, 2010. This date will be January 1, 2011, for calendar year plans. The special enrollment must include a written notice of the opportunity to enroll and the coverage must begin by the first day of the plan year. Terms of the coverage for adult children, including premium rates, cannot vary based on age. The IRS has confirmed that both coverage under and payments from a plan providing coverage to an adult child that has not attained age 27 in a taxable year do not result in taxable income. Employers may immediately permit employees to make pre-tax salary reduction contributions for health insurance coverage under a cafeteria plan and health flexivle spending arrangement for adult children under age 27 during the taxable year. However, retroactive amendments to plan documents reflecting this change must be made by December 31, 2010.
> Reinsurance Program for Early Retiree Medical Coverage
Finally, the government has issued rules for the early retiree medical coverage reinsurance program. The program will become effective on June 1, 2010 and last through 2013. Applications for participation will be processed on a first come, first served basis. Since a finite amount of funds ($5 billion) have been earmarked for this program, interested employers should act very quickly. Although applications for participation are not expected to be available until late June, the information required to complete an application is listed in the new rules, so employers can start gathering the information now.
Reimbursement payments must be used to reduce the sponsor's health benefit premiums or health benefit costs or reduce health care costs for retired or active participants (e.g. premium contributions, co-payments, deductibles, coinsurance or other out-of-pocket costs. However, a sponsor must 'provide at least the same level of contribution to support' their plans. So it appears that the primary benefit of the program for plan sponsors will be to keep their premium and cost at current level."
God help us!
Monday, July 05, 2010
Volume 70 - Health Care Bill - The Act
I find it hard to believe that may last entry was four months ago. Time is going by in 'warp speed' as the economy goes in the opposite direction. In today's business world one has to not only understand 'Cashflow' but manage it as a pro; 'receivables and payables' have taken on priority of the business. An upcoming blog will certainly have to examine the 'new priorities' that exist today in Small Business; but this addition (The Health Care Bill - The Act) has been on the 'back burner' long enough.
Not only will you have to manage 'cashflow' as never before, but now you'll also have to protect your budgets even more so due to this intolerable Health Care Bill with passage this past March. There is not doubt that this was Historic Health Care Legislation; historic for all the wrong reasons! The uncertainty with some implications for employers, health insurers, hospitals, and individuals as prepared by our (i.2's) International Law Firm, Calfee, Halter & Griswold LLP:
"On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act (Act), launching a new era of health care coverage and concerns for Americans. In a somewhat unusual twist, the much-talked-about second bill - the Health Care and Education Reconciliation Act of 2010 (Reconciliation Act) - still must be approved by the Senate before the health care law takes its final shape." (As we know, this was passed by the Senate and is law as of this writing; nevertheless, the concerns remain more than ever)
"As it stands now, some of the key provisions of the Act are as follows:
Health Insurance Exchanges: The Act calls for the creation of health insurance exchanges through which the uninsured and self-employed may purchase insurance provided by private insurers. Subsidies will be available for uninsured individuals and families who meet certain income guidelines. The Act sets forth broad parameters and creates a panel that will determine the coverage requirements and other details of the exchange operations within these parameters.
Individual Mandate: Individuals who do not purchase health insurance will pay a tax penalty.
Medicaid Expansion: The Act will increase the income eligibility for Medicaid and require states to expand Medicaid coverage to childless adults.
Employer Coverage Requirements: The Act does not require employers to provide health insurance to their employees. However, employers with more than 50 employees that do not offer health insurance to their employees (or employers that provide coverage that is insufficiently affordable) may be subject to tax penalties. The Act also imposes new requirements regarding employee waiting periods for benefit eligibility.
Insurance Coverage Requirements: The Act bans certain common insurance practices, including lifetime benefit limits and preexisting condition exclusions. It also requires insurance companies to offer coverage to adult children up to age 26. Benefit plans will also need to be amended to meet the law's new requirements.
Small Business Tax Credits: The Act creates several new tax credits for small businesses that offer health insurance coverage to their employees or purchase insurance through the separate insurance exchanges which will be created for small businesses.
Tax Increases: In addition to the tax penalties previously described, the Act contains numerous tax increases or new taxes. Insurers will be subject to an excise tax on so-called "Cadillac" insurance plans. there will be new excise taxes on medical device manufacturers, brand name pharmaceutical manufactures, health insurance providers, and other health-related industries, as well as on indoor tanning services. Individual taxpayers earning over $200,000 (or $250,000 for joint filers) will see a Medicare payroll tax increase and a new Medicare tax on unearned income (i.e. investment income).
Nonprofit Hospital Requirements: The Act imposes certain new requirements that nonprofit hospitals must satisfy to maintain tax-exempt status. Nonprofit hospitals must now conduct recurring community health needs assessments and adopt financial assistance policies meeting certain guidelines. Nonprofit hospitals will be subject to new limits on the charges they may assess against patients who qualify for such financial assistance and cannot undertake certain billing and collection activities.
Medicare Funding: The Act reduces federal payments to Medicare Advantage plans. It also limits future increases in medicare payments to hospitals, nursing homes, home health agencies and other providers."
As one can easily see, this Act does nothing for a small business that already has medical health insurance for its employees. It does nothing for reduction of prescription costs. It does nothing to stop the yearly increases to the medical coverage. What it does accomplish is to give millions of uninsured people the opportunity to gain Health Insurance for which others will have to pay; another example of 'Redistribution of Wealth.'
The Government is not able to administer such a program effectively, as history can more than prove. On the other hand, nothing is being done to regulate costs; either administratively or control of Pharmaceutical companies or conglomerate Health Care Companies. This Act simply is another example of Government control 'dolling' out benefits at the expense of those already dealing with escalating health insurance costs!
On this July 4th weekend, we should also remember within the initial Declaration of Independence writings of Thomas Jefferson the use of the word "citizens" over the scratched out word of "subjects". We are a people who are not "subjects" of a government, but "citizens"of a Republic that (at one time) recognized hard work, risk, and reward, not one that was "subject" to the control and whims of a centralized government.
As the Health Care Act develops, so will the updated translations from our Law firm.
Happy Birthday America
Not only will you have to manage 'cashflow' as never before, but now you'll also have to protect your budgets even more so due to this intolerable Health Care Bill with passage this past March. There is not doubt that this was Historic Health Care Legislation; historic for all the wrong reasons! The uncertainty with some implications for employers, health insurers, hospitals, and individuals as prepared by our (i.2's) International Law Firm, Calfee, Halter & Griswold LLP:
"On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act (Act), launching a new era of health care coverage and concerns for Americans. In a somewhat unusual twist, the much-talked-about second bill - the Health Care and Education Reconciliation Act of 2010 (Reconciliation Act) - still must be approved by the Senate before the health care law takes its final shape." (As we know, this was passed by the Senate and is law as of this writing; nevertheless, the concerns remain more than ever)
"As it stands now, some of the key provisions of the Act are as follows:
Health Insurance Exchanges: The Act calls for the creation of health insurance exchanges through which the uninsured and self-employed may purchase insurance provided by private insurers. Subsidies will be available for uninsured individuals and families who meet certain income guidelines. The Act sets forth broad parameters and creates a panel that will determine the coverage requirements and other details of the exchange operations within these parameters.
Individual Mandate: Individuals who do not purchase health insurance will pay a tax penalty.
Medicaid Expansion: The Act will increase the income eligibility for Medicaid and require states to expand Medicaid coverage to childless adults.
Employer Coverage Requirements: The Act does not require employers to provide health insurance to their employees. However, employers with more than 50 employees that do not offer health insurance to their employees (or employers that provide coverage that is insufficiently affordable) may be subject to tax penalties. The Act also imposes new requirements regarding employee waiting periods for benefit eligibility.
Insurance Coverage Requirements: The Act bans certain common insurance practices, including lifetime benefit limits and preexisting condition exclusions. It also requires insurance companies to offer coverage to adult children up to age 26. Benefit plans will also need to be amended to meet the law's new requirements.
Small Business Tax Credits: The Act creates several new tax credits for small businesses that offer health insurance coverage to their employees or purchase insurance through the separate insurance exchanges which will be created for small businesses.
Tax Increases: In addition to the tax penalties previously described, the Act contains numerous tax increases or new taxes. Insurers will be subject to an excise tax on so-called "Cadillac" insurance plans. there will be new excise taxes on medical device manufacturers, brand name pharmaceutical manufactures, health insurance providers, and other health-related industries, as well as on indoor tanning services. Individual taxpayers earning over $200,000 (or $250,000 for joint filers) will see a Medicare payroll tax increase and a new Medicare tax on unearned income (i.e. investment income).
Nonprofit Hospital Requirements: The Act imposes certain new requirements that nonprofit hospitals must satisfy to maintain tax-exempt status. Nonprofit hospitals must now conduct recurring community health needs assessments and adopt financial assistance policies meeting certain guidelines. Nonprofit hospitals will be subject to new limits on the charges they may assess against patients who qualify for such financial assistance and cannot undertake certain billing and collection activities.
Medicare Funding: The Act reduces federal payments to Medicare Advantage plans. It also limits future increases in medicare payments to hospitals, nursing homes, home health agencies and other providers."
As one can easily see, this Act does nothing for a small business that already has medical health insurance for its employees. It does nothing for reduction of prescription costs. It does nothing to stop the yearly increases to the medical coverage. What it does accomplish is to give millions of uninsured people the opportunity to gain Health Insurance for which others will have to pay; another example of 'Redistribution of Wealth.'
The Government is not able to administer such a program effectively, as history can more than prove. On the other hand, nothing is being done to regulate costs; either administratively or control of Pharmaceutical companies or conglomerate Health Care Companies. This Act simply is another example of Government control 'dolling' out benefits at the expense of those already dealing with escalating health insurance costs!
On this July 4th weekend, we should also remember within the initial Declaration of Independence writings of Thomas Jefferson the use of the word "citizens" over the scratched out word of "subjects". We are a people who are not "subjects" of a government, but "citizens"of a Republic that (at one time) recognized hard work, risk, and reward, not one that was "subject" to the control and whims of a centralized government.
As the Health Care Act develops, so will the updated translations from our Law firm.
Happy Birthday America
Monday, February 22, 2010
Volume 69 - "The Fed" - State of the Economy
I'm not sure anymore where 'sanity' starts and stops, but I'm pretty damn sure that what occurred this past Thursday rides the very edge of the logic abyss. It's either pronouncely insane or I discovered 'another' economics class that I must have (again) slept through!
The Heading for this latest 'manipulation' went something like this: "The Federal Reserve, taking its first step to normalize lending after more than two years of extraordinary actions to prop up the economy, on Thursday raised the interest rate it charges banks on emergency loans."
------STOP WAIT----"Taking its first step to normalize lending after two years of extraordinary actions to prop up the economy"----You gotta be shitting me!
This economy went into the 'shitter' in the second half of 2007. It went in that directions because of SPENDING and ENCOURAGEMENT from the Federal Government, BOTH DEMOCRATS AND REPUBLICANS, to lend money to people who could not afford the loan. Hello!!! It went into this economic cycle because Federal (and State and Local Governments) spend more than they bring in!!! and spend on programs that are totally dependant upon funding; in other words, on some type of Socialism, not on opportunities presented by a Free market, which has the opportunity to make money within itself and simply is not a 'money pit' for some segment of society that can't support itself. It did nothing other than attempt to cover the banking industry's ass for legislation that it forced or threaten to force upon the banks. Barney Franks, et al, screaming that EVERY AMERICAN MUST HAVE THE RIGHT TO OWN HIS OWN HOME (AT WHATEVER COST)..........THAT WAS THE "EXTRAORDINARY ACTIONS TAKEN" There were no other actions taken to assist the people and businesses of this country who are the ones that make money so that the stupid idiots in Government can find more ways to give it away!
It continued..."The Fed emphasized that the increase in the discount rate, to 0.75 percent from 0.50 percent, which will take effect on Friday, did not represent a broad tightening of credit. Instead, officials said, the change was intended to discourage emergency borrowing by banks and other deposit-taking institutions when other financing is available. The modifications are not expected to lead to tighter financial conditions for households and businesses and do not signal any change i the outlook for the economy or for monetary policy..."
-----STOP WAIT-----Why is it that when 'Government' (Fed or whatever) makes a decision to enact a policy, such as the decision described above, it immediately announces it in a 'negative connotation' as this "did not represent a broad tightening of credit"? Probably because IT DOES represent a broad tightening of credit which seems impossible considering that there IS NO CREDIT! The Banks are flush; their balance sheets look great! I wonder why? Could it be due to 700 billion dollars of our money? What incentive is there for the banks to lend this money out? Even with 90% Government backed guarantees, SBA 7A programs, the banks aren't interested.
So, to cover past lending practices to people who couldn't pay back money the banks now are taking it to the opposite 'side of the table' and simply aren't lending (of course, after they got their 'Bail-out' money) and people in Washington wonder what it will take to get this country out of the worse economic depression since the thirties or at least since the latter part of the 70's when interest rates were at 21% and Carter was President.
Small Business employs over 95% of the people in this country; yet, we seem to take care of the 5% 'Too Big To Fail Guys'. Small Business employs over 95% of the working people in this country but we are insistant to pay for and take care of the unemployable, illegals, and every other foreign government's castastrophe.
Stupid is as Stupid does.
The Heading for this latest 'manipulation' went something like this: "The Federal Reserve, taking its first step to normalize lending after more than two years of extraordinary actions to prop up the economy, on Thursday raised the interest rate it charges banks on emergency loans."
------STOP WAIT----"Taking its first step to normalize lending after two years of extraordinary actions to prop up the economy"----You gotta be shitting me!
This economy went into the 'shitter' in the second half of 2007. It went in that directions because of SPENDING and ENCOURAGEMENT from the Federal Government, BOTH DEMOCRATS AND REPUBLICANS, to lend money to people who could not afford the loan. Hello!!! It went into this economic cycle because Federal (and State and Local Governments) spend more than they bring in!!! and spend on programs that are totally dependant upon funding; in other words, on some type of Socialism, not on opportunities presented by a Free market, which has the opportunity to make money within itself and simply is not a 'money pit' for some segment of society that can't support itself. It did nothing other than attempt to cover the banking industry's ass for legislation that it forced or threaten to force upon the banks. Barney Franks, et al, screaming that EVERY AMERICAN MUST HAVE THE RIGHT TO OWN HIS OWN HOME (AT WHATEVER COST)..........THAT WAS THE "EXTRAORDINARY ACTIONS TAKEN" There were no other actions taken to assist the people and businesses of this country who are the ones that make money so that the stupid idiots in Government can find more ways to give it away!
It continued..."The Fed emphasized that the increase in the discount rate, to 0.75 percent from 0.50 percent, which will take effect on Friday, did not represent a broad tightening of credit. Instead, officials said, the change was intended to discourage emergency borrowing by banks and other deposit-taking institutions when other financing is available. The modifications are not expected to lead to tighter financial conditions for households and businesses and do not signal any change i the outlook for the economy or for monetary policy..."
-----STOP WAIT-----Why is it that when 'Government' (Fed or whatever) makes a decision to enact a policy, such as the decision described above, it immediately announces it in a 'negative connotation' as this "did not represent a broad tightening of credit"? Probably because IT DOES represent a broad tightening of credit which seems impossible considering that there IS NO CREDIT! The Banks are flush; their balance sheets look great! I wonder why? Could it be due to 700 billion dollars of our money? What incentive is there for the banks to lend this money out? Even with 90% Government backed guarantees, SBA 7A programs, the banks aren't interested.
So, to cover past lending practices to people who couldn't pay back money the banks now are taking it to the opposite 'side of the table' and simply aren't lending (of course, after they got their 'Bail-out' money) and people in Washington wonder what it will take to get this country out of the worse economic depression since the thirties or at least since the latter part of the 70's when interest rates were at 21% and Carter was President.
Small Business employs over 95% of the people in this country; yet, we seem to take care of the 5% 'Too Big To Fail Guys'. Small Business employs over 95% of the working people in this country but we are insistant to pay for and take care of the unemployable, illegals, and every other foreign government's castastrophe.
Stupid is as Stupid does.
Wednesday, January 27, 2010
Volume 68 - Decade of Gold, Oil and Terrorism
2010 has finally arrived with the passing of the first decade of the New Millennium - finally its over! But, what did we really learn during that last debacle of a decade?
Well, for starters, we learned that Gold and Oil are still the masters of the Universe. Gold increase over 300% with Oil at 200% during that time, with 'Terrorism' becoming a common word in our vocabulary.
We learned that until gasoline prices hit $3.00 per gallon no one gives a shit!
We learned that no matter the price of gas we, as a nation, will not do anything to become self-sufficient (the same 'nothing' that we did in the late 70's and the rest of the decade)
We learned that our borders are not safe and secure. We learned first hand what it is like, as a Nation, to be attacked on our own shores.
We learned that the Government has no clue on where foreigners, students and visitors with proper Visa, go within this country nor is there a check and balance system to monitor time restraint/location once entrance is gained.
We learned that the Bigger the Government gets, the worse it becomes for the average working citizen and small business owner.
We learned that the Bigger Government becomes, the more 'and bigger the lies to the citizenry.
We learned (Again) that War serves no purpose.
We learned that there is a growing population within this country that 'demands 'their 'Social welfare'.
We learned that if there are any trust worthy Politicians, who actually care about their constituency, that number is dwindling at a rapid pace.
We learned that for legislation to pass in Congress all members must be bribed with enough 'pork' to cause them to 'sleep through a few sessions', and then vote on something that they know 'stinks' but will comply 'bribe' in hand.
We learned that if one is (declared) "Too Big to Fail" there is tax money readily available; or, there is always the midnight shift at the Treasury to print more money.
We learned that the United States nationalized more businesses in the past decade than China.
We learned that Congress had no recognition or understanding of a Balance Sheet or Income Statement.
We learned that Banking Institutions can produce Billions of Dollars of Losses within a two year period, be on the verge of Bankruptcy, continue to pay bonuses and give 'golden parachutes' for non-productive work, and then with a 'magic wand' from Congress show excellent balance sheets within a years time and pay out billions of more dollars in bonus money and (at the same time) refuse to loan money, create lines of credit, etc for Small Businesses that employ 95% of the workers in this country.
We learned that while there is certainly need for controlling cost of Health Care, providing proper Health Care to the citizenry, working out the outrageous prescription costs for medication, and a very long list of corrective actions necessary to stop this money spiral, the Health Care Insurance Companies are as greedy as Congress, who have their own private policy, and have no regard for us. We learned that there are two menaces in this arena, both equally as corrupt and evil, Congress (the administration) and the Insurance Companies.
We have NOT learned that if there is a National Health Care Program that it will go the way of the Social Security Program. It will start out as a completely voluntary program with participates paying a limited amount of monies for some sort of coverage. The amounts of money put into this program would be deductible from their income for tax purposes. Like the beginnings of the Social Security Program, which received funding that went to a 'Trust Fund' rather than into the general operation fund to be used to fund the social security retirement program and no other Government program, these funds would pay for the newly signed up non-insured individual or other participates that wanted the Government type Insurance Program. The participates would never be taxed on these benefits; but eventually will be taxed. And, if by some miracle, this fund would become of size, the funds would (like Social Security) be diverted by Congress to pay for other programs (sort of reminds one of Bernie Madoff)
We have NOT learned (understood) that the U.S. has no working policy on illegal immigration; that this will continue to be a major problem to be made even worse with a Liberal Congress. Illegal Immigration should have been a major debate during the past national election but NO candidate had the presence of mind (balls) to pursue this issue then or NOW.
We have NOT learned the true value or understanding that we presently have in the 2nd Amendment of the Constitution; but, hopefully this understanding will somehow be achieved before it is too late.
We have NOT learned how to implement those line items that will make our Country safe from another 911; Nor have we learned or understood the lessons of 911, and we will (unfortunately) be tested again.
We have NOT learned how to respond to a major attack or natural disaster.
We have NOT learned how to listen but rather spew rhetoric in gigantic proportions.
We have NOT learned to educate our children
May 2010 be better than 2009, and my whatever God you worship give this great Nation a little guidance.............................
Well, for starters, we learned that Gold and Oil are still the masters of the Universe. Gold increase over 300% with Oil at 200% during that time, with 'Terrorism' becoming a common word in our vocabulary.
We learned that until gasoline prices hit $3.00 per gallon no one gives a shit!
We learned that no matter the price of gas we, as a nation, will not do anything to become self-sufficient (the same 'nothing' that we did in the late 70's and the rest of the decade)
We learned that our borders are not safe and secure. We learned first hand what it is like, as a Nation, to be attacked on our own shores.
We learned that the Government has no clue on where foreigners, students and visitors with proper Visa, go within this country nor is there a check and balance system to monitor time restraint/location once entrance is gained.
We learned that the Bigger the Government gets, the worse it becomes for the average working citizen and small business owner.
We learned that the Bigger Government becomes, the more 'and bigger the lies to the citizenry.
We learned (Again) that War serves no purpose.
We learned that there is a growing population within this country that 'demands 'their 'Social welfare'.
We learned that if there are any trust worthy Politicians, who actually care about their constituency, that number is dwindling at a rapid pace.
We learned that for legislation to pass in Congress all members must be bribed with enough 'pork' to cause them to 'sleep through a few sessions', and then vote on something that they know 'stinks' but will comply 'bribe' in hand.
We learned that if one is (declared) "Too Big to Fail" there is tax money readily available; or, there is always the midnight shift at the Treasury to print more money.
We learned that the United States nationalized more businesses in the past decade than China.
We learned that Congress had no recognition or understanding of a Balance Sheet or Income Statement.
We learned that Banking Institutions can produce Billions of Dollars of Losses within a two year period, be on the verge of Bankruptcy, continue to pay bonuses and give 'golden parachutes' for non-productive work, and then with a 'magic wand' from Congress show excellent balance sheets within a years time and pay out billions of more dollars in bonus money and (at the same time) refuse to loan money, create lines of credit, etc for Small Businesses that employ 95% of the workers in this country.
We learned that while there is certainly need for controlling cost of Health Care, providing proper Health Care to the citizenry, working out the outrageous prescription costs for medication, and a very long list of corrective actions necessary to stop this money spiral, the Health Care Insurance Companies are as greedy as Congress, who have their own private policy, and have no regard for us. We learned that there are two menaces in this arena, both equally as corrupt and evil, Congress (the administration) and the Insurance Companies.
We have NOT learned that if there is a National Health Care Program that it will go the way of the Social Security Program. It will start out as a completely voluntary program with participates paying a limited amount of monies for some sort of coverage. The amounts of money put into this program would be deductible from their income for tax purposes. Like the beginnings of the Social Security Program, which received funding that went to a 'Trust Fund' rather than into the general operation fund to be used to fund the social security retirement program and no other Government program, these funds would pay for the newly signed up non-insured individual or other participates that wanted the Government type Insurance Program. The participates would never be taxed on these benefits; but eventually will be taxed. And, if by some miracle, this fund would become of size, the funds would (like Social Security) be diverted by Congress to pay for other programs (sort of reminds one of Bernie Madoff)
We have NOT learned (understood) that the U.S. has no working policy on illegal immigration; that this will continue to be a major problem to be made even worse with a Liberal Congress. Illegal Immigration should have been a major debate during the past national election but NO candidate had the presence of mind (balls) to pursue this issue then or NOW.
We have NOT learned the true value or understanding that we presently have in the 2nd Amendment of the Constitution; but, hopefully this understanding will somehow be achieved before it is too late.
We have NOT learned how to implement those line items that will make our Country safe from another 911; Nor have we learned or understood the lessons of 911, and we will (unfortunately) be tested again.
We have NOT learned how to respond to a major attack or natural disaster.
We have NOT learned how to listen but rather spew rhetoric in gigantic proportions.
We have NOT learned to educate our children
May 2010 be better than 2009, and my whatever God you worship give this great Nation a little guidance.............................
Monday, November 30, 2009
Volume 67 - Street Smart Strategy Vol. 2 - Cost Cutting
Finally I'm getting back to the newly created 'Street Smart Strategy' series (I've been preoccupied with the idiots in Washington, ESPN and the NFL), so lets simply continue with Volume 2 (of that series) and pick up where we ended the last installment talking about 'Cost-Cutting' as it relates to the Customer/Sales and overall effect on a company.
Three simple statements regarding Cost-Cutting and one Major Rule to always observe:
1. Most cost-cutting programs fail because 'someone' (usually the CFO, who normally can't get out of his own way, with a overburdened staff of underachievers) sets a predetermined goal, for example, of a 20% reduction, and then spreads the 'pain' evenly around the business. But what these 'mental giants' have missed for years is that running a company at 80% of its previous cost is not the same as becoming the market leader by being the high-profit, low-cost provider.
Instead of cutting costs everywhere, squeeze costs out of your company as well as the "C-Customers" because (one must realize) you have "C type" customers; squeeze costs out of your "C" type employees as well as "C type" departments (like accounting and administration!), and keep service levels at their highest for your "A-Customers" and your "A-Employees" ( "A" Departments - those that produce results that benefit the bottom-line).
To reach better productivity, with few overall employees, segment the market to target the right customer groups with the correct service levels at the right cost. No doubt this strategy should be instituted in the "Good Times" as well as the logic of "Bad Times." Along with 'segmentation' of the market, the next ingredient must be the restructuring of the work load pertaining to all departments. The key question when discussing restructuring (addressed below) is simply 'are people spending the most time where it will bring the best returns, applicable to the Accounting Department as it is with the Sales Department.'
2. Cut Cost during the "Good Times" - Simple, but only the Great Companies understand this concept. It still amazes me when I continue to read about those "thousands" of employee layoffs; were all these people necessary six months ago?
3. Unless cost cutting leads to better productivity, this approach does more harm than good. Customers will leave when they notice that the quality of service/quality of product is slipping. So the question becomes how does one get better production with less people? Answer: Change the nature of the work. Restructure the work based upon the old adage of 80/20. A future blog will explain not only the 80/20 rule but how to adapt your business to that rule as it references the customer. Put the people where it will produce the best results for the customer.
Golden Rule to Always Observe is 'own' your customers, rather than just 'renting' them. Owning them means making a lifetime commitment to deal with each customer's needs and problems.
Hopefully your Thanksgiving involved more than food; but remembrances of your Friends and the value that 'Friendship' offers.....................................................
Three simple statements regarding Cost-Cutting and one Major Rule to always observe:
1. Most cost-cutting programs fail because 'someone' (usually the CFO, who normally can't get out of his own way, with a overburdened staff of underachievers) sets a predetermined goal, for example, of a 20% reduction, and then spreads the 'pain' evenly around the business. But what these 'mental giants' have missed for years is that running a company at 80% of its previous cost is not the same as becoming the market leader by being the high-profit, low-cost provider.
Instead of cutting costs everywhere, squeeze costs out of your company as well as the "C-Customers" because (one must realize) you have "C type" customers; squeeze costs out of your "C" type employees as well as "C type" departments (like accounting and administration!), and keep service levels at their highest for your "A-Customers" and your "A-Employees" ( "A" Departments - those that produce results that benefit the bottom-line).
To reach better productivity, with few overall employees, segment the market to target the right customer groups with the correct service levels at the right cost. No doubt this strategy should be instituted in the "Good Times" as well as the logic of "Bad Times." Along with 'segmentation' of the market, the next ingredient must be the restructuring of the work load pertaining to all departments. The key question when discussing restructuring (addressed below) is simply 'are people spending the most time where it will bring the best returns, applicable to the Accounting Department as it is with the Sales Department.'
2. Cut Cost during the "Good Times" - Simple, but only the Great Companies understand this concept. It still amazes me when I continue to read about those "thousands" of employee layoffs; were all these people necessary six months ago?
3. Unless cost cutting leads to better productivity, this approach does more harm than good. Customers will leave when they notice that the quality of service/quality of product is slipping. So the question becomes how does one get better production with less people? Answer: Change the nature of the work. Restructure the work based upon the old adage of 80/20. A future blog will explain not only the 80/20 rule but how to adapt your business to that rule as it references the customer. Put the people where it will produce the best results for the customer.
Golden Rule to Always Observe is 'own' your customers, rather than just 'renting' them. Owning them means making a lifetime commitment to deal with each customer's needs and problems.
Hopefully your Thanksgiving involved more than food; but remembrances of your Friends and the value that 'Friendship' offers.....................................................
Tuesday, October 27, 2009
Volume 66 - ESPN/NFL Columbus Day 2009!!!
Over the years I've criticized Formula One Racing, Major League Baseball, the National Hockey League and other Sports Organizations for their idiotic rulings and/or statements but nothing even comes close to the 'insensitivity' and utter 'disrespect' for Italian-Americans than the broadcast by ESPN of the NFL's Monday Night Football this past October 12, 2009, Columbus Day.
Columbus Day is celebrated in the United States as a Federal Holiday honoring not only Christopher Columbus but the Italian heritage of Italian Americans. It is celebrated on the second Monday in October, Federal and State Offices are closed as well as Banks in this 'national' celebration. The same holds for March 17th, Saint Patrick's Day, where "everyone is Irish" for the day, celebrating the heritage of Irish Americans. We, as Americans, have a federal holiday for Martin Luther King Day celebrating the works of Mr. King and his contributions toward equality. I can go on about the Holidays and their associated dates, but I think you get the idea.
This past Columbus Day, October.12, 2009, however there was a difference. And, before I get to that difference let me be very clear about the subject of racism/discrimination as it pertains to me, as an individual. It is without question that my 'family' of associates and friends crosses more ethnic lines (than anyone I'm aware of) from 'Black' to 'Yellow' to 'Brown,' multiple continents, four to be exact, without a single ounce of prejudice as I respect not only individual races, colors, and creeds but also the special days, and the special people that are so represented by each.
So.....back to Columbus Day this past October 12th and Monday Night Football and the NFL's presentation of the Latino Night, the Latino Culture and recognition of Latin NFL players on Columbus Day. Before writing this blog I had a conversation with one of my Italian American Friends and discussed this obvious 'slight' toward Italians; to which his reply was... "the NFL/ESPN knew that 'not a whisper' would be coming forth from the Italians, unlike other races who would cause major disruptions throughout the United States and cause 'their' leaders to perch upon the pedestals of NBC and have the NFL make a personal apology, whereas nothing would be forthcoming from the Italian-American community." I'm unfortunately inclined to believe my friend.
This celebration could have been on any other day within October, but not on Columbus Day. The heritage of Italians in America is one of honor, respect, and hard work. There are no Federal or State Laws written for the protection of Italians in this country. This great nation hasn't spent a single dime on Italians, as a nationality, yet has progressed as a nation due to Italian American perseverance and hard work produced over the centuries. One would think that on one day of the year ESPN or the NFL and even the President of the United States (who gave a media presentation at half-time via satellite ) would have had better sense and judgement.
I wonder what would have happened if Monday Night Football and recognition of Latino Day would have been played on the Third Monday of January.
Columbus Day is celebrated in the United States as a Federal Holiday honoring not only Christopher Columbus but the Italian heritage of Italian Americans. It is celebrated on the second Monday in October, Federal and State Offices are closed as well as Banks in this 'national' celebration. The same holds for March 17th, Saint Patrick's Day, where "everyone is Irish" for the day, celebrating the heritage of Irish Americans. We, as Americans, have a federal holiday for Martin Luther King Day celebrating the works of Mr. King and his contributions toward equality. I can go on about the Holidays and their associated dates, but I think you get the idea.
This past Columbus Day, October.12, 2009, however there was a difference. And, before I get to that difference let me be very clear about the subject of racism/discrimination as it pertains to me, as an individual. It is without question that my 'family' of associates and friends crosses more ethnic lines (than anyone I'm aware of) from 'Black' to 'Yellow' to 'Brown,' multiple continents, four to be exact, without a single ounce of prejudice as I respect not only individual races, colors, and creeds but also the special days, and the special people that are so represented by each.
So.....back to Columbus Day this past October 12th and Monday Night Football and the NFL's presentation of the Latino Night, the Latino Culture and recognition of Latin NFL players on Columbus Day. Before writing this blog I had a conversation with one of my Italian American Friends and discussed this obvious 'slight' toward Italians; to which his reply was... "the NFL/ESPN knew that 'not a whisper' would be coming forth from the Italians, unlike other races who would cause major disruptions throughout the United States and cause 'their' leaders to perch upon the pedestals of NBC and have the NFL make a personal apology, whereas nothing would be forthcoming from the Italian-American community." I'm unfortunately inclined to believe my friend.
On a day when the NFL could have honored Italian Americans, NFL Players-Coaches-Owners, active and past, like Brian Griese, Vinny Testaverde, Travis Henry, Greg Camarillo, Bobby Sippio, Anthony Fasano, Liro Luoto, Jason Fabini, Chris Naeole, Dominic Raiola, Alan Faneca, Richie Incognito, Mike Devito Ryan Boschetti, Ryan LaCasse, Tedy Bruschi, John DeGiorgio, Vinny Ciurciu, Jon Abbate, Ray Ventrone, Matt Giordano, Jon Corto, Sabby Piscatelli, Adam Vinatieri, Mike D'Antoni, Steve Mariucci, Joe Montana, Dan Marino, Alan Ameche, Joe Bellino, Stephen Bisciotti, Nick Buoniconti, Gino Cappelletti, Edward J. DeBartolo Jr., Joe Flacco, Franco Harris, Vince Lombardi, Gino Machetti, Ed Marinaro, Bill Parcells, Dick Vermeil TO NAME A FEW, they decided to honor Latins, since it was Latino month.
This celebration could have been on any other day within October, but not on Columbus Day. The heritage of Italians in America is one of honor, respect, and hard work. There are no Federal or State Laws written for the protection of Italians in this country. This great nation hasn't spent a single dime on Italians, as a nationality, yet has progressed as a nation due to Italian American perseverance and hard work produced over the centuries. One would think that on one day of the year ESPN or the NFL and even the President of the United States (who gave a media presentation at half-time via satellite ) would have had better sense and judgement.
I wonder what would have happened if Monday Night Football and recognition of Latino Day would have been played on the Third Monday of January.
Monday, October 19, 2009
Volume 65 - Balance
God was missing for six days.
Eventually, Michael, the archangel, found him, resting on the seventh day.
He inquired, "Where have you been?" God smiled deeply and proudly pointed downwards through the clouds, "Look, Michael. Look what I've made."
Archangel Michael looked puzzled, and said, "What is it?" "It's a planet," replied God, and I've put life on it... I'm going to call it Earth and it's going to be a place to test BALANCE."
"Balance?" inquired Michael, "I'm still confused."
God explained, pointing to different parts of Earth. "For example, Northern Europe will be a place of great opportunity and wealth, while Southern Europe is going to be poor. Over here I've placed a continent of white people, and over there is a continent of black people. Balance in all things." God continued pointing to different countries. "This one will be extremely hot, while this one will be very cold and covered in ice."
The Archangel , impressed by God's work, then pointed to a land area and said, "What's that one?" "That's Virginia, replied God, the most glorious place on earth. There are beautiful mountains, rivers and streams, lakes, forests, hills and plains. The people from Virginia are going to be handsome, modest, intelligent, humorous, and they are going to travel the world. They will be extremely sociable, hardworking, high achieving carriers of peace, and producers of good things."
Michael gasped in wonder and admiration, but then asked, "But what about balance, God?
You said there would be balance..."
God smiled, "Right, next to Virginia is Washington DC . Wait 'til you see the idiots I put there..."
Speaking of Balance a short editorial on the State of Economy and the lack of economic talent (idiots) in Washington DC. It is my belief that the economy is not going to turn around due to the Federal Stimulus programs. It is my belief that the economy is not going to turn around specifically because of the TARP money, which is just a financial 'papering over' of $13 Trillion dollars bailout of whom? Certainly not the people! The FDIC is bankrupt, Freddie and Fannie are bankrupt and the Federal Government is bankrupt. And thus, the reason why the banks are not lending money even though their balance sheets look like they are strengthening.
The more the federal government (Congress) talks about stimulus, the cheaper the dollar is going to get and the higher Gold is going to go. There has been a 'bank robbery' but the banks have done the robbing. The Bernanke pronouncement made big headlines stating that the recession is almost over. Bernanke, like your local weatherman, has never been right in any of his pronouncements. We criticize countries like China for purchasing our 'notes' without realizing that the US must borrow three billion per day from 'foreigners' just to stay alive. The interest on our present debt is now 800 million per day. How long do you think that 'foreigners' will keep financing this debt? BALANCE is not even understood; but, the 'idiots' in Washington continue to give away 'the bank' (or to the bank!). CUT THE SPENDING! CUT THE TAXING! CREATE SOME BALANCE!
Eventually, Michael, the archangel, found him, resting on the seventh day.
He inquired, "Where have you been?" God smiled deeply and proudly pointed downwards through the clouds, "Look, Michael. Look what I've made."
Archangel Michael looked puzzled, and said, "What is it?" "It's a planet," replied God, and I've put life on it... I'm going to call it Earth and it's going to be a place to test BALANCE."
"Balance?" inquired Michael, "I'm still confused."
God explained, pointing to different parts of Earth. "For example, Northern Europe will be a place of great opportunity and wealth, while Southern Europe is going to be poor. Over here I've placed a continent of white people, and over there is a continent of black people. Balance in all things." God continued pointing to different countries. "This one will be extremely hot, while this one will be very cold and covered in ice."
The Archangel , impressed by God's work, then pointed to a land area and said, "What's that one?" "That's Virginia, replied God, the most glorious place on earth. There are beautiful mountains, rivers and streams, lakes, forests, hills and plains. The people from Virginia are going to be handsome, modest, intelligent, humorous, and they are going to travel the world. They will be extremely sociable, hardworking, high achieving carriers of peace, and producers of good things."
Michael gasped in wonder and admiration, but then asked, "But what about balance, God?
You said there would be balance..."
God smiled, "Right, next to Virginia is Washington DC . Wait 'til you see the idiots I put there..."
Speaking of Balance a short editorial on the State of Economy and the lack of economic talent (idiots) in Washington DC. It is my belief that the economy is not going to turn around due to the Federal Stimulus programs. It is my belief that the economy is not going to turn around specifically because of the TARP money, which is just a financial 'papering over' of $13 Trillion dollars bailout of whom? Certainly not the people! The FDIC is bankrupt, Freddie and Fannie are bankrupt and the Federal Government is bankrupt. And thus, the reason why the banks are not lending money even though their balance sheets look like they are strengthening.
The more the federal government (Congress) talks about stimulus, the cheaper the dollar is going to get and the higher Gold is going to go. There has been a 'bank robbery' but the banks have done the robbing. The Bernanke pronouncement made big headlines stating that the recession is almost over. Bernanke, like your local weatherman, has never been right in any of his pronouncements. We criticize countries like China for purchasing our 'notes' without realizing that the US must borrow three billion per day from 'foreigners' just to stay alive. The interest on our present debt is now 800 million per day. How long do you think that 'foreigners' will keep financing this debt? BALANCE is not even understood; but, the 'idiots' in Washington continue to give away 'the bank' (or to the bank!). CUT THE SPENDING! CUT THE TAXING! CREATE SOME BALANCE!
Monday, September 14, 2009
Volume 64 - Political Correctness - Health Care
"Political Correctness" - "Political correctness is a doctrine, fostered by a delusional, illogical minority, and rabidly promoted by an unscrupulous mainstream media, which holds forth the proposition that it is entirely possible to pick up a turd by the clean end."
So now YOU want National/Federal Health Insurance (of course, we are NOT talking about the Health Care Plan that covers our Congressmen or Senators)......Well, here's a story to reflect on........
"The Night Watchman
Once upon a time the government had a vast scrap yard in the middle of A desert. Congress said, "someone may steal from it at night.." So they created a night watchman position and hired a person for the job..
Then Congress said, "How does the watchman do his job without instruction?" So they created a planning department and hired two people, one person to write the instructions, and one person to do time studies.
Then Congress said, "How will we know the night watchman is doing The tasks correctly?" So they created a Quality Control department and hired two people. One to do the studies and one to write the reports.
Then Congress said, "How are these people going to get paid?" So they created the following positions, a time keeper, and a payroll officer, then hired two people. Then Congress said, "Who will be accountable for all of these people?" So they created an administrative section and hired three people, an Administrative Officer, Assistant Administrative Officer, and a Legal Secretary.
Then Congress said, "We have had this command in operation for one Year and we are $18,000 over budget, we must cutback overall cost." So they laid off the night watchman.
NOW slowly.
Let it sink in.
Quietly, we go like sheep to slaughter.
Does anybody remember the reason given for the establishment of the
DEPARTMENT OF ENERGY .... During the Carter Administration?
Anybody?
Anything?
No?
Didn't think so!
Bottom line. We've spent several hundred billion dollars in support of
an agency ... the reason for which not one person who reads this can
remember!
Ready?? It was very simple ... and, at the time, everybody in Congress thought it 'Very Appropriate. ' The Department of Energy was instituted on 8-04-1977. TO LESSEN OUR
DEPENDENCE ON FOREIGN OIL.
Hey, pretty efficient, huh???
AND, NOW, IT'S 2009 -- 32 YEARS LATER -- AND THE BUDGET FOR THIS
"NECESSARY" DEPARTMENT IS AT $24.2 BILLION A YEAR.
THEY HAVE 16,000 FEDERAL EMPLOYEES AND APPROXIMATELY 100,000 CONTRACT
EMPLOYEES; AND, LOOK AT THE JOB THEY HAVE DONE!
THIS IS WHERE YOU SLAP YOUR FOREHEAD AND SAY, "WHAT WAS I THINKING?"
Ah, yes -- good ole bureaucracy."
Certainly I would like better health care at more affordable prices. Certainly I would like to purchase prescriptions drugs at more affordable pricing. Certainly I would like all U.S. citizens to be able to have health insurance; for there are many disabled and partially disabled that continually suffer without the ability for proper treatments. Do I think that Pharmaceutical companies, Insurance companies and Hospitals take advantage of people? Is the Pope Catholic!! - Of course they do, just as all companies attempt to acquire more profitability (and in some cases, at 'Any Cost or Means'). Major League Baseball Parks charge $9 for a bottle of beer and $4 for water! That isn't any different than a Pharmaceutical Company charging 10 or 50 times the cost of a drug.
The point being is that Health Care is simply out of control with costs surpassing 12% per year and something must be done to correct this condition as well as proper coverage for U.S. Citizens. BUT IT ISN'T GOING TO BE A FEDERAL GOVERNMENT HEALTH CARE PROGRAM; GOVERNMENT CAN'T GET OUT OF ITS OWN WAY! It needs correct and proper enforced regulations, just as Wall Street needs regulated (of course, unless you a Bank or General Motors aka Government Motors); but, NOT owned and operated by the Government. Tell your Congressmen to get off their collective asses and and start correcting the problem; something like what their health care plan delivers; Yea, right!
So now YOU want National/Federal Health Insurance (of course, we are NOT talking about the Health Care Plan that covers our Congressmen or Senators)......Well, here's a story to reflect on........
"The Night Watchman
Once upon a time the government had a vast scrap yard in the middle of A desert. Congress said, "someone may steal from it at night.." So they created a night watchman position and hired a person for the job..
Then Congress said, "How does the watchman do his job without instruction?" So they created a planning department and hired two people, one person to write the instructions, and one person to do time studies.
Then Congress said, "How will we know the night watchman is doing The tasks correctly?" So they created a Quality Control department and hired two people. One to do the studies and one to write the reports.
Then Congress said, "How are these people going to get paid?" So they created the following positions, a time keeper, and a payroll officer, then hired two people. Then Congress said, "Who will be accountable for all of these people?" So they created an administrative section and hired three people, an Administrative Officer, Assistant Administrative Officer, and a Legal Secretary.
Then Congress said, "We have had this command in operation for one Year and we are $18,000 over budget, we must cutback overall cost." So they laid off the night watchman.
NOW slowly.
Let it sink in.
Quietly, we go like sheep to slaughter.
Does anybody remember the reason given for the establishment of the
DEPARTMENT OF ENERGY .... During the Carter Administration?
Anybody?
Anything?
No?
Didn't think so!
Bottom line. We've spent several hundred billion dollars in support of
an agency ... the reason for which not one person who reads this can
remember!
Ready?? It was very simple ... and, at the time, everybody in Congress thought it 'Very Appropriate. ' The Department of Energy was instituted on 8-04-1977. TO LESSEN OUR
DEPENDENCE ON FOREIGN OIL.
Hey, pretty efficient, huh???
AND, NOW, IT'S 2009 -- 32 YEARS LATER -- AND THE BUDGET FOR THIS
"NECESSARY" DEPARTMENT IS AT $24.2 BILLION A YEAR.
THEY HAVE 16,000 FEDERAL EMPLOYEES AND APPROXIMATELY 100,000 CONTRACT
EMPLOYEES; AND, LOOK AT THE JOB THEY HAVE DONE!
THIS IS WHERE YOU SLAP YOUR FOREHEAD AND SAY, "WHAT WAS I THINKING?"
Ah, yes -- good ole bureaucracy."
Certainly I would like better health care at more affordable prices. Certainly I would like to purchase prescriptions drugs at more affordable pricing. Certainly I would like all U.S. citizens to be able to have health insurance; for there are many disabled and partially disabled that continually suffer without the ability for proper treatments. Do I think that Pharmaceutical companies, Insurance companies and Hospitals take advantage of people? Is the Pope Catholic!! - Of course they do, just as all companies attempt to acquire more profitability (and in some cases, at 'Any Cost or Means'). Major League Baseball Parks charge $9 for a bottle of beer and $4 for water! That isn't any different than a Pharmaceutical Company charging 10 or 50 times the cost of a drug.
The point being is that Health Care is simply out of control with costs surpassing 12% per year and something must be done to correct this condition as well as proper coverage for U.S. Citizens. BUT IT ISN'T GOING TO BE A FEDERAL GOVERNMENT HEALTH CARE PROGRAM; GOVERNMENT CAN'T GET OUT OF ITS OWN WAY! It needs correct and proper enforced regulations, just as Wall Street needs regulated (of course, unless you a Bank or General Motors aka Government Motors); but, NOT owned and operated by the Government. Tell your Congressmen to get off their collective asses and and start correcting the problem; something like what their health care plan delivers; Yea, right!
Tuesday, August 18, 2009
Volume 63 - Street Smart Strategy - Vol 1
I probably should have started my 'Street Smart Strategy' segments with the last edition with "What Lessons I've Learned At i.2;" but, considering the fact that I seem to learn something, good or bad, everyday it won't be difficult to update Volume 62 to fit into this new 'Street Smart Strategy' series. So I'll open up this new series with knowledge about 'average data' and more insight into that 'data' with reference the 'customer,' Sales' personnel intertwined with 'cost cutting' measures during a downturn.
We find ourselves living more and more in a society where business can draw on more data than ever before about its typical customer, industry segment, and buying habits of that average group within that particular industry. We receive constant requests from Industry Associations and others for this 'confidential' information. Without a doubt we can know the average age, education, income, and even the profitability of 'everything' average. As useful as this information may be, and the importance of the associated technology to obtain such information, I maintain it can be extremely dangerous.
Never forget that there is no such thing as an "average" customer, and there is no excuse for delivering average service to either your best or your worst customers. Treat your customers not as the average of their differences, but as people who have very different needs, and who make widely different contributions to your profits. Your best customer, who adds the most to your profits, and your worst customer, who adds the least to revenues, balance out to an average value to your business. But it is a huge mistake to treat them both the same. Similarly, customers in different markets may have totally opposite needs. Instead of one all-purpose strategy for every market, we at Independence2, LLC believe that businesses have to tailor their strategies to win sales according to the needs of that particular customer.
It is no different than analyzing the strengths and weaknesses of a particular business and adding value added results to the analysis, something that I did during my last couple years with WWH. Just as one would collect data from 100 Bakery shops and then 'rack and stack' the results gives you an 'average' business without taking into account the specific nuances of the business. What we do know with certainty, however, is that whether you are the 'customer' or the 'business,' we know that 20 % of the customers will bring in 80% of the business (profits) and this has nothing to do with average.
The real key is really the QUESTIONS that I've learned from what I call the 'Street Smart Strategy' that asks: What would happen if you knew how to use your resources to deliver the right sales, with the right service to the right customer, at the right cost? Obviously, your profits should jump higher than ever before; yet we know that one approach doesn't fit all customers. We (Independence2, LLC) do know that sales, service, quality and cost fits all the target groups to one degree or another. The 'mix' is the recipe that makes it work.
When one takes the categories of sales, service, quality and cost and begin to 'peel back the onion skin' of each is when you realize the complexity of the matter at hand. Lets take, for example, the arena of Sales representation; and in our particular world it evolves around 'Manufacturer Representatives' rather than 'direct' employees, the difference obviously is that the 'Rep' is a 1099 employee working off of an agreed upon commission based on collection. A self-employed entrepreneur versus an employee who picks up a 'pay-check' on a regular basis not necessarily based on that employee's production. As you can see, this simple category of Sales (representation) starts to break apart on its own with types, management oversee, culture, costs, etc. This, however, is not about the Pros and Cons of whether a Direct Sales Force is better than Manufacturer Reps or vice versa, it is about the 'Street Smart Strategy' that one learns through years of working, observing and being part of identifying and selling to each individual customer. It is however important to bring out the above described differences between the two Sales Forces for it directly effects the strategy in managing either one.
I will have to admit that I haven't been extremely successful with 'Reps' over the years, for they either come in one of two categories; those that are aggressive and overcome obstacles or else those that have a 'million excuses' for not succeeding, sort of a 'take on society' as a whole. I was fortunate enough years ago to be introduced to and work with one of the very best 'Reps' within our industry, my friend and buddy, Tom Maxwell. Tom probably taught me more about the 'Sales' game than anyone, thus my start of the 'Street Smart Strategy' at least from the Sales representation perspective.
Tom taught me that although you need a quality product and competitive pricing you need more the 'unequivocal service' that is associated with that product. This service means 'On-Time' and 'Complete' 100% of the time. It means that you build a relationship with a customer through sustained quality, fair pricing and absolute honesty. It means that not all customers are going to be 'good' customers. It means (again) the shoe doesn't fit everyone. It means that you remove obstacles from the customer's decision to purchase. It means you take risks; but, it also means that you penetrate a market. It means you customize your approach. It means you target customers and 'rack and stack' customers based on the profits they bring in. To the credit of the good 'Reps,' they know which customers are worth going after for they know what that customer wants. They also know that good service and sales depend on assessing the market, choosing the targets, and then crafting an approach to fit their needs.
The worth of the Salesperson within a given territory is of high value to the 'Street Smart' owner (corporation or small business) but, believe it or not, this value diminishes the higher up the hierarchy (organizational chain) of larger companies. There are people who actually question the value of a commission salesperson after hundreds of thousands of dollars are captured and the 'hierarchy' has to write out the 5 or 6% commission check. I've actually sat in meetings where this subject was discussed and debated; somehow forgetting that the money now received would be zero without the precision type work of the aggressive and knowledgeable 'Rep.' I actually had a conversation with Tom concerning this matter, and he, with his wisdom of years, related the following story:
"This is a story of the boiler repairman who was hired to fix an enormous boiler system on a steamship. He spent a few minutes studying the miles of twisting pipes in the boiler room. Then he pulled a hammer from his pocket and tapped a valve. The entire system started working perfectly, and the next day the repairman sent a bill for $1,000. The steamship owner, outraged that the repairman had charged so much after spending only 15 minutes to fix the problem, demanded an itemized invoice. The repairman sent a new bill that read: 'For tapping with hammer, 50 cents. For knowing where to tap, $999.50.' Tapping a boiler is simple. But knowing where to do it is not easy. The same is true of Manufacturer Reps and the marketplace. You have to know which segments and which customers of the market to tap." The good "Reps" know that......of course, the other side of the picture are the 'Reps' who will give a million reasons why they aren't successful with the product and none of the reasons have to do with them; those aren't worth the 50 cent hammer blow.
The next segment of the 'Street Smart Strategy' and the final one for this edition is very pertinent in today's market, and maybe more so than Sales Strategy for it has a direct bearing on the Sales numbers. Cost-Cutting during poor economic times is the subject matter as we continue to see on the evening news company after company laying off hourly and salaried personnel by the thousands. As I had mentioned in previous blogs, it's amazing to me that companies can lay-off thousands of workers over such a short period of time. A larger question begs answering and that is - "were these people that important six months ago? " It may seem as a harden type question but one that must be answered, for in poor economic times costs certainly must be contained and reduced; but doesn't that also apply to 'good' times especially if you understand profitability? The problem is that most cost-cutting programs fail anyway because 'someone' sets a predetermined goal of say, a 20 % reduction, and then the pain is spread evenly around the business. But what these individuals have missed for years is that running a company at 80 percent of its previous cost is not the same as becoming the market leader by being the high-profit, low-cost provider. Instead of cutting costs everywhere, squeeze costs out of your service to C-customers, and keep service level high for your A-customers where the returns will more than pay for the expense in addition to always looking a costs even during the 'good' times.
Cost Cutting is a Volume by itself, so we'll be hearing more about this very difficult subject in future editions. In the meantime, simply understand that taking percentages from every department simply to meet some arbitrary number is a formula for failure.
We find ourselves living more and more in a society where business can draw on more data than ever before about its typical customer, industry segment, and buying habits of that average group within that particular industry. We receive constant requests from Industry Associations and others for this 'confidential' information. Without a doubt we can know the average age, education, income, and even the profitability of 'everything' average. As useful as this information may be, and the importance of the associated technology to obtain such information, I maintain it can be extremely dangerous.
Never forget that there is no such thing as an "average" customer, and there is no excuse for delivering average service to either your best or your worst customers. Treat your customers not as the average of their differences, but as people who have very different needs, and who make widely different contributions to your profits. Your best customer, who adds the most to your profits, and your worst customer, who adds the least to revenues, balance out to an average value to your business. But it is a huge mistake to treat them both the same. Similarly, customers in different markets may have totally opposite needs. Instead of one all-purpose strategy for every market, we at Independence2, LLC believe that businesses have to tailor their strategies to win sales according to the needs of that particular customer.
It is no different than analyzing the strengths and weaknesses of a particular business and adding value added results to the analysis, something that I did during my last couple years with WWH. Just as one would collect data from 100 Bakery shops and then 'rack and stack' the results gives you an 'average' business without taking into account the specific nuances of the business. What we do know with certainty, however, is that whether you are the 'customer' or the 'business,' we know that 20 % of the customers will bring in 80% of the business (profits) and this has nothing to do with average.
The real key is really the QUESTIONS that I've learned from what I call the 'Street Smart Strategy' that asks: What would happen if you knew how to use your resources to deliver the right sales, with the right service to the right customer, at the right cost? Obviously, your profits should jump higher than ever before; yet we know that one approach doesn't fit all customers. We (Independence2, LLC) do know that sales, service, quality and cost fits all the target groups to one degree or another. The 'mix' is the recipe that makes it work.
When one takes the categories of sales, service, quality and cost and begin to 'peel back the onion skin' of each is when you realize the complexity of the matter at hand. Lets take, for example, the arena of Sales representation; and in our particular world it evolves around 'Manufacturer Representatives' rather than 'direct' employees, the difference obviously is that the 'Rep' is a 1099 employee working off of an agreed upon commission based on collection. A self-employed entrepreneur versus an employee who picks up a 'pay-check' on a regular basis not necessarily based on that employee's production. As you can see, this simple category of Sales (representation) starts to break apart on its own with types, management oversee, culture, costs, etc. This, however, is not about the Pros and Cons of whether a Direct Sales Force is better than Manufacturer Reps or vice versa, it is about the 'Street Smart Strategy' that one learns through years of working, observing and being part of identifying and selling to each individual customer. It is however important to bring out the above described differences between the two Sales Forces for it directly effects the strategy in managing either one.
I will have to admit that I haven't been extremely successful with 'Reps' over the years, for they either come in one of two categories; those that are aggressive and overcome obstacles or else those that have a 'million excuses' for not succeeding, sort of a 'take on society' as a whole. I was fortunate enough years ago to be introduced to and work with one of the very best 'Reps' within our industry, my friend and buddy, Tom Maxwell. Tom probably taught me more about the 'Sales' game than anyone, thus my start of the 'Street Smart Strategy' at least from the Sales representation perspective.
Tom taught me that although you need a quality product and competitive pricing you need more the 'unequivocal service' that is associated with that product. This service means 'On-Time' and 'Complete' 100% of the time. It means that you build a relationship with a customer through sustained quality, fair pricing and absolute honesty. It means that not all customers are going to be 'good' customers. It means (again) the shoe doesn't fit everyone. It means that you remove obstacles from the customer's decision to purchase. It means you take risks; but, it also means that you penetrate a market. It means you customize your approach. It means you target customers and 'rack and stack' customers based on the profits they bring in. To the credit of the good 'Reps,' they know which customers are worth going after for they know what that customer wants. They also know that good service and sales depend on assessing the market, choosing the targets, and then crafting an approach to fit their needs.
The worth of the Salesperson within a given territory is of high value to the 'Street Smart' owner (corporation or small business) but, believe it or not, this value diminishes the higher up the hierarchy (organizational chain) of larger companies. There are people who actually question the value of a commission salesperson after hundreds of thousands of dollars are captured and the 'hierarchy' has to write out the 5 or 6% commission check. I've actually sat in meetings where this subject was discussed and debated; somehow forgetting that the money now received would be zero without the precision type work of the aggressive and knowledgeable 'Rep.' I actually had a conversation with Tom concerning this matter, and he, with his wisdom of years, related the following story:
"This is a story of the boiler repairman who was hired to fix an enormous boiler system on a steamship. He spent a few minutes studying the miles of twisting pipes in the boiler room. Then he pulled a hammer from his pocket and tapped a valve. The entire system started working perfectly, and the next day the repairman sent a bill for $1,000. The steamship owner, outraged that the repairman had charged so much after spending only 15 minutes to fix the problem, demanded an itemized invoice. The repairman sent a new bill that read: 'For tapping with hammer, 50 cents. For knowing where to tap, $999.50.' Tapping a boiler is simple. But knowing where to do it is not easy. The same is true of Manufacturer Reps and the marketplace. You have to know which segments and which customers of the market to tap." The good "Reps" know that......of course, the other side of the picture are the 'Reps' who will give a million reasons why they aren't successful with the product and none of the reasons have to do with them; those aren't worth the 50 cent hammer blow.
The next segment of the 'Street Smart Strategy' and the final one for this edition is very pertinent in today's market, and maybe more so than Sales Strategy for it has a direct bearing on the Sales numbers. Cost-Cutting during poor economic times is the subject matter as we continue to see on the evening news company after company laying off hourly and salaried personnel by the thousands. As I had mentioned in previous blogs, it's amazing to me that companies can lay-off thousands of workers over such a short period of time. A larger question begs answering and that is - "were these people that important six months ago? " It may seem as a harden type question but one that must be answered, for in poor economic times costs certainly must be contained and reduced; but doesn't that also apply to 'good' times especially if you understand profitability? The problem is that most cost-cutting programs fail anyway because 'someone' sets a predetermined goal of say, a 20 % reduction, and then the pain is spread evenly around the business. But what these individuals have missed for years is that running a company at 80 percent of its previous cost is not the same as becoming the market leader by being the high-profit, low-cost provider. Instead of cutting costs everywhere, squeeze costs out of your service to C-customers, and keep service level high for your A-customers where the returns will more than pay for the expense in addition to always looking a costs even during the 'good' times.
Cost Cutting is a Volume by itself, so we'll be hearing more about this very difficult subject in future editions. In the meantime, simply understand that taking percentages from every department simply to meet some arbitrary number is a formula for failure.
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