How to Invest in a Company

How to invest in a company is one of the most basic investment skills to master for those with funds under their management. Perhaps the easiest way for publically traded companies is to purchase their stock via the stock market where they are listed. For this, you will need to open up and fund a stock brokerage account with a broker that handles transactions onthe public exchange where the stock is listed.Furthermore, if the company you wish to invest in is based in a foreign country, you might also need to perform a foreign exchange transaction to sell your domestic currency and purchase the foreign currency in order to invest in that company. An easier alternative for U.S.based stock investors can be to purchase American Depository Receipts or ADRs for the large foreign companies that list their stock in the United States.Of course, how to invest in a company that is not publically traded is quite another matter. If the company is soon going to make an initial public offering or IPO, then it may be possible for sizeable investors to be included on a subscription list for the offering managed by the investment bank involved. Since IPO stock can often rise substantially shortly after becoming publically traded, this investment strategy might turn out to be quite lucrative for those who can participate.Some companies are so small or tightly held by the founders that, while they have taken the time to incorporate, they do not yet wish tohave their stock become publically traded or listed on a major stock exchange for some reason.To obtain funding, such companies might offer interested investors theopportunity to make private loans or participate in some other form of private investment opportunity that involves profit sharing. Such companies can be approached to see if they might accept new privateinvestors, and they could also be open to accepting financing from venture capital firms.

How to Invest in People

In an investment context, one of the primary skills of successful venture capital investors involves the ability to discern how to invest in people to produce future profits. What investing in people means to such venture capitalists is identifying a talented and motivated individual or team that has the strong potential to take their company to new heights of success. Such people are generally inwardly driven to pursue excellence, and that special quality gives them a higher chance of having a positive impact on their firm's bottom line.If this anticipated increase in profitsmaterializes, it will in turn spur growth in the value of an initial investment in their venture, thereby making the venture capitalist a handsome return on their invested funds.Of course, the challenge here involves correctly identifying such individuals at a sufficiently early stage to make the investment worthwhile.A considerably more personalmethod of how to invest inpeople involves investing your funds directly in a specific individual's future, rather than in a company they are working for. Such an investment is typically a private arrangement that might often take the form of a loan made to the individual by the investor over a given term with interest and principal payments expected.Furthermore, in recent years, someenterprising individuals have reportedly been soliciting substantial upfront payments from investors in exchange for a modest percentage of their future income.Such an investment proposal wouldoffer an investor a return more likea stock on their investment in that particular person.Alternatively, from a business or personnel manager's perspective, how to invest in people probably refers to the choices that the leadership of their company makeswhen it comes to furthering the abilities and improving the job satisfaction of its valued staff. Taken in this context, investing in people usually involves such things as employee recruitment and training, compensation, lifestyle accommodation, workplace enhancement and offering attractive perks.

Tips for Maximizing Employee Potential

As a manager, maximizing employee potential should be one of your top priorities. Disgruntled, idle workers who do the bare minimum are dead weight for your company. Each employee you hire should be considered an investment in the company. Being able to push your employees to themaximum potential (without breaking them, of course) will enhance your entire company's productivity and efficiency. Here are some ideas to help your workers be the best that they can be - and not hate you in the process.Hire the Right PeopleFirst and foremost, recruit the right people! This seems simple and silly,but more often than not employerschoose the safe choice - the middle of the pack applicant that won't stir up trouble.Applicants who are too opinionatedor have "too much personality" are often nixed from the list of potential hires due to their unpredictability. This would be a huge mistake - often these individuals possess leadership characteristics which would enhance your workforce.Identify Existing Skills and Areas for PotentialFrom your workforce, you should assess individual potential. Maybe your data entry grunt actually has skills in other areas, such as product design or technical writing. Get to know your employees, their past experiences and their interests. Often times, an unhappy employee is simply a bored one, stuck in an unchallenging and unfulfilling post.Maybe a certain employee doesn't have outside skills, but has such a mastery of their job that they can be given the responsibility of training new hires. Or maybe they have outside skills that can be pursued in their free time - for example, search giant Google used to require that its programmers setaside 20% of their time on personalpet projects, in an effort to foster creativity. You can even rotate employees between positions to insure that everyone understands the different jobs at your company, so they can substitute each others' jobs, if need be.Understand if your employees are natural leaders, followers or innovators. If there are a few cogs that are getting stuck, such as irreparably disgruntled employees, these toxic employees will have to be removed from the equation to insure smooth operations.Nurture and develop talent in house.If you followed the steps above youshould have a good idea of who your future leaders will be. Train them continuously, and have them train others. These prospective leaders should also be aware of your intentions to promote them. Let them know that you have your eye on them, to keep them competitive and vying for your attention. Reward these employees generously in the form of awards, bonuses of more flexible work hours. Give them recognition and make them feel like an integral, irreplaceable part of the company. These are the employees you want to pass along professional information and contacts to, in hopes that they will one day rise to a management position. Allow these employees to organize and lead company events in your place.Consistent Performance Reviews & FeedbackStay up to date with appraisals and feedback. Employees need to be thoroughly and continuously evaluated - not only when they are up for a raise.Set up a fair rating system - efficiency, punctuality, teamwork, attitude - and discuss the results with them after each appraisal. At each appraisal, have the employee set his or her goals for the next appraisal, which will be subsequently gauged. This keeps employees aware of their own goals, and if they stayed their original course or strayed from it. Ifthey stay with it, reward them - if they strayed off the path, remind them of their preset goals.In addition, require employees to take risks. You don't want employees who will always play it safe, or act as yes men. Reward employees who take risks and attempt to think outside the box, even if they fail, since this is a hallmark of a true leader.Now, if you have non-performing employees, even after encouragement, it may be time to part ways. Clearly warn and let go of these employees for non-performance. There's no point in subtlety here if you want to maximize your employees' overall performance. Make it clear to otheremployees that the employee was let go because they failed to improve or contribute to the workplace.These ideas should get you better in tune with maximizing employee potential, and as a result, make youa better manager!

Keeping an Eye on Your Competitors

It is said that "imitation is the sincerest form of flattery", but in the world of business, imitation is inevitable, and hardly flattering. Forexample, Apple's iPhone and iPad products have been imitated by a number of competitors, such as HTC and Samsung, which have incurred the legal wrath of Steve Jobs and company. Meanwhile, in the video game industry, cookie cutter genres are the norm, with each studio imitating a popular franchise - such as Call of Duty, World of Warcraft or Grand Theft Auto - in an attempt to cash in on current popular trends, rather thanshoulder the inherent risks of innovation.Competitors in China have taken imitation to extreme levels, with fake iPods, iPhones and iPads freely available at any major street market. In this world which relies on low-risk and high-rewards, imitation clearly trumps innovation.However, truly learning from competitors doesn't mean flat out imitating them. While there is no fault in following the successful trend of a market leader, such as Apple, there is a flaw in slavish imitation. In Apple's case, its cheaper Android imitators have given Apple the unintended gift of free advertising. People buy Android phones because they resemble iPhones at a cheaper price, but it ultimately fails to satisfy their desire for the real iPhone, which leads to a high turnover rate which benefits Apple.You don't want to create a product that so closely resembles a competitor's higher priced model that it causes your customers to view yours as an inferior, cheaper model. However, that's only a rule of product design.First of all, be aware of your competitors. Companies often get blindsided by a company which wasn't perceived as a real competitor until it is too late. An obvious example is cell phone maker Nokia's fall at the hands of Apple, which had long been perceived as a personal computer company with no interest in mobilehandsets. Google also blindsided invincible software giant Microsoft by rapidly transforming from a search engine into a cloud-based software company. In turn, social networking site Facebook hit Google in a blind spot by outgrowing its status as a social siteand branching out into all the nooks and crannies of the web, a final frontier which Google had laid claims to.The lesson gathered here is that your competitors aren't always whoyou think they are. Besides your normal industry peers, be aware of which hidden companies are threatening to cross over industry lines to threaten your business.Find several major competitors to follow. Commit your workforce to follow their every move, and try to gauge their business strategies based on their current products, supply chain, pricing and financial condition, if the company trades publicly. For example, Google has been struggling to follow in Facebook's footsteps with its social network, Google+. You can bet that both companies are thoroughly evaluating the strengths and weaknesses of the other. Facebook has "Like", therefore Google has"+1". Google is changing groups into a more user-friendly "Circles" format, so Facebook strikes back byrevamping its Groups pages into a new, simpler format.iPhone and Google Apps? Check. Instant photo sharing from smart phones? Check. This kind of rapid fire tit-for-tat is what your companyneeds to stay competitive and ahead of your competitors. Make sure your products have everythingyour competitor promises and more - hopefully at a lower price.Lastly, follow public opinion regarding your competitors. Read its product reviews, and comments posted by real users. Take note of the good reviews as well as the bad,and see how you can use this free advice to modify your own products. Keeping your finger on the pulse of the everyday consumer, who cares enough to post his or her opinions online, can help avoid disastrous product design mistakes. Setting up social networking pages - on Twitter and Facebook - and inviting public discussion regarding your products can keep you well informed about your strengths and flaws comparedto the competition.

The Advantages of an Organizational Structure

An organizational structure is the framework that helps employees achieve their goals and do their jobs, according to Lamar University. An efficient company structure can benefit the organization in several ways, including making it easier to delegate responsibility and effect change throughout the organization. To benefit from a strong framework, it is important to understand the advantages of organizational structure.Unified Marketing Message A company can present a unified front to customers, vendors and investors when a common marketing message is used throughout the organization. A unified marketing message can help theentire company better understand its marketing goals, and then work together to achieve them. When multiple departments are involved in a single endeavor, a unified marketing message can be essential to project success. Succession A strong organizational structure is better able to prepare qualified employees for management. When the company operates under a strong structure, a comprehensive management training plan is easier to create and execute to help maintain a strong managerial core. Departments can work together on a developmental plan to help encourage the training of managerial candidates within any department. Focus on Strategy Using a strong organizational structure allows a company to better focus on a single set of goals instead of each groupworking towards its own agenda, according to Family Business Experts. This is the result of the flow of communication an organizational structure offers, as well as the establishment of responsibility and respect for the company hierarchy that comes from strong structure. It helps the company to use resources wisely in the pursuit of company goals as opposed to doubling efforts or experimenting with options perhaps not in the company's best interests.Training A good organizational structure makes employee training easier to administer, and it also allows it to remain flexible based on the changes within the organization. When organizational structure regulates the flow of information, then changes within that information are easier to monitor and better adaptable for a company-wide training program.Decision MakingAn organizational structure can make decision making a more efficient process, according to Lamar University.When a defined hierarchy is in place, the company is better equipped to make important decisions and adjust practices to meet the demands of competition.

The Advantages of Following the Organizational Rules

Not all rules were "made to be broken."Your small business benefits from rules you set and enforce. They define your organization and give it its personality, and they can keep your business in compliance with the law. Those rules also help managers and employees understand where they fit into your business. Effectiveness of Decisions When your organization follows the rules of reporting to supervisors and managers, your decisions spread throughout your business uniformly. For example, if you decide your company will adhere to a business casual dress code, you can ask your managers to enforce that code, deal with any infractions and provide you with a workplace that offers the appearance you choose. Larger decisions, such as pursuing a new market, spread through your organization efficiently when everyone obeys the rules of the reporting hierarchy. Reduced Discrimination Fair treatment of employees results from firm rules regarding discrimination in hiring and management practices. Though one complaint about rules is that they can be impersonal, in this case the removal of personal bias in the treatment of employees works in your favor. If you clearly state anti-discrimination policies, you can show that your position is clear in the event of a violation, accusation or lawsuit. The rules protect you and your company by showing that discrimination is against company policy. Clear Authority When you set rules, you decide who enforces them. Conveying authority to managers and supervisors establishes guidelines for discipline and correction. Employees learn not only the rules but who they are accountable to for their adherence to those rules. This creates an orderly workplace with clear lines of authority that save employees and managers time determining who enforces the rules. Criteria for Promotions When all of your employees follow the rules, you can promote people based on their skills rather than their compliance. For example, if all employees follow safety regulations, you don’t have to spend your time evaluating each employee on the basis of adherence to safety measures. You can instead evaluate useful skills and aptitudes that earn the employee a higher position with more responsibilities.

Organizational Structure Guidelines

Every company in the business environment has a specific organizational structure. This structure usually includes the framework that outlines various features regarding the company’s management layers and organizational objectives. Most organizational structures are unique to each company, since the size and operational environment often dictate the policies or rules within the business. An organizational structure may also depend on whether a company is a sole proprietorship, partnership or corporation. TYPES Two common types of organizational structures exist in the business environment: centralized and decentralized. Centralized organizational structures: This rely on one individual to guide the company and make business decisions. This structure often works well in small businesses with few employees. A decentralized organization may use a management team or allow employees to use some level of autonomy when making business decisions. These organizations may require more work when managing business operations. Features Most organizational structures are written as a chart outlining the responsibility of each manager in the business organization. This chart provides the company with a visual representation of the company’s organization. Organizations are usually broken out into groups, or similar business functions fall under the direction of one individual who has experience or expertise in these business functions. This ensures that individuals with the proper knowledge and understanding of business functions operate in a familiar environment. Functions Organizational structures provide companies with high levels of internal control. Internal controls are the specific functions developed to safeguard and protect various business operations and the information produced in each department. These structures may also create a system of checks and balances, ensuring that one department or manager does not have too much control in the organization. Companies may develop the disciplinary process in the organizational structure for departments or for individuals operating outside the company’s formalframework. Benefits Businesses with a formal organizationalstructure may be able to spend less time working on internal management issues and more time producing consumer goods or services. Increasingoutput of business operations allows companies to maximize their profitability rather than spending copious amounts of time adjusting theirinternal management structure. Companies may also be able to improve their communication and information work flow, since managers and employees have a clear understanding of who needs what in the business.Expert Assistance Law firms, management consultants and public accounting firms are a few private sector companies that can help businesses create formal organizationalstructures. Each of these professional groups may provide specific information to assure the company does not overstep its bounds when developing an organizational structure. Businesses may also use the local chamber of commerce or Small Business Administration (SBA) for providing additional information on creating an organizational or management structure.

Roles of Organizational Structure

One role of organization structure is decision making. Organizational structure pertains to the way in which companies arrange their departments. Smaller companies tend to have flatter organizational structures with few management levels. Larger companies use tall organizational structures with many echelons of management and employees. Companies use several types of organizational structure for specific roles. For example, companies using a geographic organizational structure decentralize various functions like marketing because of varying regional needs. Efficiency One role of organizational structure is efficiency. Most companies need to make the most of various resources. Duplicating raw materials or job duties is wasteful and inefficient. Consequently, a company will structure its organizational according to productsand services it offers. A small software manufacturer may use a customer-oriented organizational structure because of its wide variety of customers. For example, the software company may sell to consumers, corporations, financial institutions, hospitals and health clubs. In this case, organizing departments by customers is efficient because of diversity. Product management duties may differ widely by customer type. Marketing to consumers is much different than targeting corporations. Harnessing Experience Another role of organizational structure is harnessing experience. Companies may arrange their companies by specific functions, such as marketing, accounting, finance and engineering. The purpose of grouping departments by function is to use the experience of groups to accomplish tasks and projects. A certain synergism exists when skilled employees of similar talents work together as a whole. For example, marketing and advertising managers can better evaluate the potential success of a new product introduction as a group. Decision Making Organizational structure in a company also enhances decision making, according to Referenceforbusiness.com. Companies will often structure their organizations to make the best decisions possible. For example, a company may decentralize its marketing to make quicker decisions locally. Consequently, the company may put marketing managers in one of four different regions. It is much easier for regional marketing managers to make local decisions about consumer needs than a marketing manager in a distant corporate office. Communication Companies also also use various organizational structures for communication purposes. Larger companies have many levels of management. Therefore, the most effective way to communicate is usuallyfrom the top of the organization down. Executives create certain operational procedures which they communicate todirectors and managers. Managers, in turn, explain these operational procedures to subordinates or hourly employees. Span of Control Organizational structure is used for span of control. For example, a vice president of marketing may be in charge of four directors: One for marketing research, brand management, advertising and public relations. The directors may have three separate groups of managers reporting to them. Span of control pertains to the number of employees an executive or manager oversees. This reporting structure is how companies establish accountability.

How to Do Bookkeeping for a Small Business

Every small business must keep careful track of its present and future cashflow.It is very possible for a profitable business to go under because it does not have enough cash on-hand to meet its current financial obligations. Careful tracking of future cashflow is crucial to avoid this unhappy outcome. Step 1 Create a ledger with the current balance of all of your financial accounts. Most businesses carry accounts for cash on hand, a checking account used for rolling revenue and expenditures, and ancillary accounts as necessary to properly manage their funds. Your ledgers can be in accounting software; personal finance software, which is sufficient for some small businesses; or the old school paper ledger. If you find it difficult to keep accurate and complete records on a computer, use paper as a temporary holding place until you can enter transactions into your software. Step 2 Record all payments made from these accounts in your ledger. Payments are usually listed with the following information: date, payee, category (for tax purposes), memorandum and a record of the check number if a bank check is used. Step 3 Record all money actually received by the business for any reason, with the exception of loans and investment funds. Loans and investments should be accounted in separate ledgers and not booked as revenue. Incoming revenue is typically recorded with similar columns or database categories as payments: date, payee, category and memorandum. Step 4 Create an upcoming payment schedule of all future payments anticipated by your business, such as rent, utilities, and other recurring payments. This is called your Accounts Payable, or AP. If you have upcoming one-time expenses which you would like to make, you can also use this ledger to budget for them; for example, if you would like to spend $5,000 on renovations in January, you can book that as a $1,000 set-aside for the months of August through December. Many businesses book their AP with two dates: the date it is due and the deadline which it is actually due before penalties are incurred. Step 5 Create an upcoming monies received schedule, which anticipates future receipts. This is called your Accounts Receivable, or AR. This ledger is most important for businesses that process invoices to their clients, and hence do not receive payments until their clients actually cut the checks. If you are using software, it is crucially important that AR payments do not automatically roll over into actual payments received ledger. You do not want to book a payment scheduled for 7/15 that does not actually arrive until 7/22, or you risk bouncing checks drawn against that amount. Step 6 Reconcile your ledgers with your bank statements. This is where accounting software truly shines over paper ledgers; most software will automatically download your bank records and allow you to quickly mark which payments and deposits are already recorded in your ledger, and which must be separately accounted. This is typically done on a monthly schedule, but with software and online banking, it is not onerous to do this on a weekly or even daily schedule--and this is not too often for a small business.

How to Record a Loan to Your Business in Bookkeeping

Bookkeeping tracks and records business transactions, including financing transactions such as a loan to a business. Recording a loan in bookkeeping often involves reporting the receipt of the loan, paying for interest expense over time and the return of the loan principal at maturity. If a loan is amortized, the recording must reflect changes in outstanding loan balance over the loan term. This would require periodic adjustments to the original loan principal. The accounts used to record a loan in bookkeeping consists of different liability accounts, an interest expense account and the cash account. Step 1 Record the loan proceeds and loan liability. When a business takes out a loan, it incurs either a current liability if the loan is a short-term loan payable, or a long-term liability if the loan is a long-term debt. In exchange, the business receives the loan proceeds in cash. To record the initial loan transaction, the business enters a debit to the cash account to record the cash receipt and a credit to a related loan liability account for the outstanding loan. Step 2 Record the loan interest. Lenders charge interest on their loans on a periodic basis such as monthly or semiannually, and interest is paid out based on payment schedules. When recording a loan in bookkeeping, a business must accrue the interest expense on the same periodic basis even if the interest is not currently due. The accrued interest is debited to the interest expense account and a credit is made to a current liability account under interest payable for the pending interest payment liability. Step 3 Record interest payments. Interest payments sometimes are made after the interest is accrued and recorded. In this case, making an interest payment does not cause a business to incur interest expense again. To record such an interest payment, the business enters a debit to the account of interest payable to remove the pending interest payment liability and credits the cash account for the amount of interest paid. Step 4 Record the loan payment. Unamortized loans are repaid at once in the amount of the loan principal at maturity. To record the loan payment, a business debits the loan account to remove the loan liability from the books, and credits the cash account for the payment. For an amortized loan, payments are made over time to cover both interest expense and the reduction of the loan principal. To record a periodic loan payment, a business first applies the payment toward interest expense and then debits the remaining amount to the loan account to reduce its outstanding balance. The cash account is credited to record the cash payment.

How to Break Down Business Expenses for Taxes

The Internal Revenue Service requires businesses to keep a record of expenses for tax auditing and filing purposes. Small businesses may have fewer expenses than larger companies and can track them using the four basic categories of expenses, purchases, travel and assets. Each category can contain subcategories to include more specific expenses particular to your business. Using an efficient method of tracking expenses, such as computer software or a spreadsheet, also can make it easier to assess the budget and adjust costs. Step 1 Track business expenses by looking at costs incurred by your business to operate and function. This includes common costs such as renting a storefront and employee salaries. Ordinary and necessary business expenses in for-profit companies usually are deductible. Step 2 Track business purchases. Purchases are incurred costs based on products purchased and resold. For producers, this includes purchased raw materials that are manufactured into another product. Categorize your proof of purchase methods, including canceled checks, cash register tapes, account statements, credit card sales slips, invoices and petty cash slips for small cash payments with your business purchases. Step 3 List travel, car operation costs, mileage and meals as part of a separate category. These expenses may be deductible. If your business qualifies, you can use either the actual expense method, which deducts the entire cost of vehicle use, or the standard mileage rate, which reimburses a certain amount based on mileage. Businesses weigh which method will give them the highest return amount. Talk with your accountant to see if your business qualifies. Step 4 Write a list of assets including machinery, furniture and property your business uses. Keep a record to calculate annual depreciation costs. Also keep a record of any gains or losses when your business sells assets. Maintain record such as the purchase price, improvement costs of assets, depreciation deductions taken, selling prices and expenses of the sale. Step 5 Write a list of other benefits not already covered. If your business has numerous expenses, such as employee benefits and tuition reimbursement programs, break these expenses down into subsections that are more specific to the individual needs of your company. Keep credit card sales slips and invoices for IRS-required recording purposes with a record of these expenses.

The Definition of Teamwork in the Workplace

Teamwork is a word that is often thrown around in the business world. However, what exactly is meant by the actual term "teamwork" may differ from one business to the next or even from one person to the next. The difficulty in establishing a definition for the term stems from the fact that it actually consists of several facets. Cooperation Teamwork in the workplace involves cooperation among workers. This cooperation is usually for the sake of a common goal that the entire team is working toward -- such as a sales quota or some other measurable outcome. Insome cases, however, the common goal may be something more nebulous,such as the well-being of the company. Teamwork requires that all workers contribute their fair share to the workload so that the company can accomplish its goals in a timely and satisfactory manner. Relationships Teamwork is more complicated than cooperation among workers. While cooperation is essential to teamwork, it is only partially able to help teams reach their goals. A willingness to cooperate stems from relationships that develop between coworkers or between employees and the employer. Teamwork cannot exist without this relational component, even if the extent of the relationship is minimal. Teamwork does not occur if each person does his own thing separately from his work relationships. Learning Teamwork is also about more than just reaching the end goal in some cases. The relationship that exists between members of a team can result in the workers or team members getting to know one another on a deeper level. This relational learning can contribute to future cooperative endeavors as workers learn to understand how each person on the team contributes to the overall process of accomplishing a goal. Leadership Teamwork in the workplace also involves leadership development. With each task, teams do not necessarily divvy up the work equally among all team members. Instead, each person contributes his part. Within a teamwork environment, this may also involve the establishment of team leaders who help to ensure that the work is completed in a timely manner. Teamwork can involve working together under the leadership of one person who has been chosen as leader or is naturally recognized as such by team members.

Purpose And Benefit of Communication in Business

For some professionals, the purpose of communication in business can sometimes seem like an excuse for a boss or a customer to talk endlessly about their problems. Effective executives understand the opportunity inherent in that kind of communication to uncover powerful solutions that can propel a company to long-term success. FEATURES Achieving real effectiveness requires executives to define the outcome they want to achieve from any communication with a customer or with a colleague. Author and lecturer Asha Kaul writes that setting an expected outcome helps communicators focus their energy on a specific, measurable goal. In addition, Kaul notes that the most powerful business communication requires an interactive cycle marked by speaking and listening. For instance, a salesperson and a prospect may volley communications for days or weeks before arriving at the intended next action: a closed deal. EFFECTS Viewing the purpose of communication as an opportunity to reach a defined goal helps professionals refocus their efforts around cultivating strong relationships, inside and outside their organizations. The effects of building a feedback cycle around engaged listening often include increased sales, earned trust, and status as a key adviser for customers and executives. Using scenario planning and other conceptual tools, professionals can review their progress along a longer-term path, reducing frustration over perceived audience resistance. CONSIDERATIONS The cliche about the customer always being right haunts many executives. Retailer Marshall Field often gets credit for coining the phrase, but modern professionals understand that a powerful communication cycle can bridge the gap between parties until they see clear ways to meet each others’ needs. For instance, in an engaged feedback cycle, a salesperson doesn’t have to bend his offering to match the exact request of a customer. Instead, he can reframe or refocus the message to highlight that a customer’s feedback has been heard and integrated into the ongoing conversation. MISCONCEPTIONS Failing to acknowledge a prospect’s concerns can derail communication, often negating the original purpose for engagement. For example, direct mail marketing companies often earn criticism for blanketing prospects with multiple mail pieces while leaving no opportunity for audience feedback. Novice marketers might mistakenly blame an audience for failing to understand the mass-produced message. However, experienced communicators use alternative methods to learn why prospects ignore advertising. Tailoring future campaigns to include their feedback results in more consistent success. BENEFITS OF COMMUNICATION IN BUSINESS When business professionals clarify the purpose of their communication, they often develop a commitment to achieving goals. In his book, “The Seven Habits of Highly Effective People,” author Stephen Covey advises readers to “seek first to understand, then to be understood.” Matching up that habit with the skill to measure success in small segments gives leaders the tools necessary to celebrate consistent wins on the way to long-term achievement.

Kinds of Business Communication

As a small business owner, you'll need to communicate effectively with customers, employees and other business people to run an effective operation. To do so, various kinds of communication methods are available to stay in touch with your employees, as well as provide a means for customer contact. Business communication can be internal, such as when conversing with your employees, or external, such as when advertising or dealing with suppliers. Face-to-Face Face-to-face communication is perhaps the most personal form of communication in the workplace. It occurs when two employees discuss a work situation or work together on a project. Supervisors use this method when conveying important information to a subordinate or when conducting a performance appraisal. Face-to-face communication is often used during the training process, such as when a new worker "shadows" a more experienced employee. Written Written communication traditionally took the form of the business memos or reports, although the proliferation of computers has made the email and spreadsheet the preferred written method of choice in many business situations. Email can be used to send a brief note to an individual employee or to convey policy or procedural changes to an entire company. A more formal business letter is often used when communicating with other businesses. Meetings Meetings are a way to gather a group ofpeople together with a common interest, such as members of a particular department. Meetings are often used to communicate a new idea or a change in an existing procedure. Sales meetings are used as a way to motivate salespeople or to communicate sales goals. Meetings may be held on a regular or as-needed basis. Telephone Telephones are used to contact other workers within the business or with other companies. The widespread use of cell phones allows for business to be conducted outside of the office or while traveling. The development of teleconferencing facilitates meetings between employees located in different geographic areas. Customer In addition to communicating with employees and other business associates, communication is also used to interact with customers. Advertising and marketing entices people to patronize a business, while customer service departments give customers the opportunity to contact businesses with a complaint or question. Company websites give customers another way to purchase products or services or obtain information, as well as providing an additional means for customer interaction.

Improving Team Work in the Work place

The efforts of teams often produce far greater results than individual efforts. Leslie Palich of Pepperdine University concludes from her studies that teams are generally more productive and their work can lead to the creation of valuable new products. However, groups can also encounter difficulties: infighting, disagreement about the project's direction and vague objectives are just a few issues that can create contention with even the most skilled teams. Improving teamwork in the workplace can be achieved in several ways. Implement Recognition Programs Encourage quality teamwork by rewarding groups for good performance. Create incentives to workwell as a team by giving praise and issuing small tokens of appreciation that bear the project or company name. Alan Orr, author of the book"Advanced Project Management," suggests giving the team publicity for itswork. Such a gesture instills a sense of meaning and value into the nature of the job, thereby boosting teamwork among group members. Encourage Social Activities Teamwork is enhanced when workers know each other and are comfortable discussing a variety of issues. Build this sense of camaraderie by formulating team activities. These events could be informal, such as meeting together over coffee at the nearby café, or the team building event may be more elaborate by taking place over the weekend at a secluded resort on the outskirts of town. Outline Clear Roles Boost teamwork abilities by outlining clear roles for each of the members. Before the project commences, work with the members to outline skill sets and deadline charts. Delineate responsibilities according to ability. Consult with the group regarding the feasibility of the listed tasks as well, which will deduce possible stress arising from unrealistic expectations. Identify Existing Problems Gain feedback from the team to assess sources of strife. Examples of problems include one group member being unresponsive, an inability to meet deadlines, conflict over how best to proceed on the project and personality clashes. Though groups might be tempted to let issues sort themselves out over time, such a method may not be optimal. Lisa DiTullio, author of the book, "Project Team Dynamics," advises that problems be handled the moment they arise. Encourage group members to discuss issues collectively instead of letting the problem fester and grow larger. Mediate Disputes Provide detailed instructions on how to remedy issues that arise among team members, which boosts teamwork by empowering members to solve issues efficiently and productively. Begin by suggesting that group members talk directly with the person creating any negative effects. Encourage the group to provide clear documentation of any problems as well. From there, team members should give distinct guidelines for how to improve the situation. Instead of creating a culture of blame, foster an attitude of being proactive and solution oriented. For example, if one member repeatedly fails to turn in her portion of the projecton time, mandate that she provide dailydocumentation of what she has completed thus far.

Interpersonal Skills Needed to Build Team Cohesion

Whether you work on a project team or an athletic team, there are a variety of interpersonal skills each team member can employ to build team cohesion. These interpersonal skills include everything from involving each member of the team to respecting the individual views in the group. By using these interpersonal skills, you can help your team work more closely together and get more done. Open Communication The glue that holds teams together is open communication. No matter what you are talking to team members about, you should employ open communication. This includes speaking directly and clearly to the person to whom you wish to communicate an idea. Open communication also relies on the communicator being concise, focused and specific. When everyone expresses their expectations and comments in this way, team cohesion is enhanced because everyone is on the same page and understands what is expected of them. Respect Respect for others is a key to communication. Direct comments and criticism must be tempered with courtesy and respect for the feelings and views of others. Even if you make clear, reasonable points to other team members, team cohesion will suffer if each member does not feel respected, valued and listened to. Involvement It is essential for each member to involve every individual in the team. Unless each team member is involved in the project and team decisions, motivation to accomplish team goals will be low. Team cohesion relies on each member soliciting feedback from her peers and listening to each person's input. It is each team member's responsibility to employ these interpersonal skills during team activities to foster cohesion. Fairness When leading a team or simply participating in it, fairness is key. Everyone has friends and favorites among the members of a team, but indulging your preferences toward individual team members reduces team cohesion. When each member of the team feels like they have a fair chance of communicating their views and airing their grievances, the team works better together and problems are identified early on.

What Are Non-Quantifiable Tools in Marketing?

A marketing program is the plan you use to make your identified customers aware of your product or services and where they need to go to obtain them. The tools for implementing your marketing goals include advertising, promotions, event marketing or sales events and more. Unfortunately, a majority of marketing tools are non-quantifiable, meaning only your sales results tell you whether your marketing plan is working. Advertising Unless you have a way of capturing information from your customers of how they found out about your business, advertising methods includingradio, television, the Internet or print are not always quantifiable. If you run an advertising campaign in a newspaper, a coupon could help you quantify your advertising results, but otherwise you have no way to determine whether specific advertising efforts are successful. Event Marketing Though a good turnout for a special event can generate traffic, it's hard to quantify the results from event marketing. Local home-improvement events at the county fairgrounds give you a chance to get your home-improvement business name known, hand out some business cards, develop leads and interact with locals, but it's hard to quantify the results from these events. Your business might not see results from your event marketing until months later, long after the event has occurred. Promotional Items Merchandising giveaways such as pens, cup holders and magnets for the refrigerator get your name out there, but if your customers don't use the items you've provided, it could be a waste of money. When you plan to merchandise your business through these promotional items, ensure that the item is something your customer wants, needs or will use. That way, your name stays in front of your customer. Even so, it's hard to quantify the results from the free giveaways you offer customers, other than generating good will. Social Media A new and popular marketing tool is using social media sites, but it's hard to quantify the results of these efforts against your business sales. A "like" button on a social media site hardly constitutes an increase in income, but it does validate your business and helps spread the news. At the end of the business cycle, all of your marketing efforts might result in an increase in sales, but identifying the tool that generated the sale is hard to do. Analyzing Marketing Efforts Compare marketing efforts by calendar date with the sales for that same period to better understand the effects of your marketing programs. For instance, if you ran a radio advertisement for a specific period, review your sales results for that same period. If they were up, there's a good chance your marketing was successful. If you have customers sign up for an email list, offering only those customers email specials can help quantify those efforts.It takes some imagination and trial and error to find the marketing tools that best suit your business.

How to Maximize Your Profits

Business owners want their bottom line to be as profitable as possible. To maximize profits, the owner must be diligent in cutting frivolous costs and boost productivity among employees. This is an ongoing process that often faces many challenges. The key to success is to always remember that at the end of the day, the business's profits will serve two purposes. The profits will be reinvested in the business to allow the business to grow. The profits will also be distributed to the business owner. Step1 Analyze where money is being spent. Overhead is one of the biggest categories of expenses that business owners face. A long-term lease is often an effective way to ensure you are aware of increases in your rent expense. Review the other categories ofexpenses. If there is a large increase in a specific category, look into the details of that category. Perhaps you had an increase in advertising or insurance costs. If the advertising campaign is paying off in increased sales, then the higher expense may be worth it. Insurance costs are always on the rise. Avoid changing insurance providers on a regular basis unless rates skyrocket. Your insurance broker knows your business and should be offering the best rate possible to keep your business. Step2 Review your cost structure. Make sure you have a sufficient markup on your goods. When the cost of raw materials and related costs increase, the additional costs need to be included in the selling price. Reviewing your cost structure on a regular basis will help you keep track of costs that are on the rise before the cost is too great to completely include in your selling price. For example, if the cost of a widget was$10 but now is $12, you can pass along aportion of the incremental cost to customers without affecting your profit.However, if you don't increase the price to the consumer until the widget cost increases to $50, you are bound to lose customers due to your skyrocketing prices. Step3 Motivate your employees. When your employees are happy, more quality work gets accomplished in a shorter amount of time. If employee motivation is really holding your company back, consider using simple motivation techniques. For example, the Employee of the Month may receivea $50 gift card for a local merchant. Theemployee who increases his output may receive a lunch bought by the company. Having a company picnic where employees bring their families for an afternoon of games and food is another suggestion. If you use a systemthat requires a tangible amount of product from employees, do not set goals too high. This will only decrease employee morale and negatively impact your profitability.

Does Maximizing Customer Satisfaction Maximize Profitability?

Maximizing customer satisfaction makes an important contribution to maximizing profitability, although other factors such as cost control, productivity and marketing strategy also impact the bottom line. By maximizing customer satisfaction, you can increase the opportunity for repeat sales to customers, while reducing the cost of sales and marketing. Customer satisfaction helps to increase customer loyalty, reducing the need to allocate marketing budget to acquire new customers. Satisfied customers may also recommend your products or services to other potential customers, increasing the potential for additional revenue and profit. Retention Your business risks losing customers through the effects of competitive activity and natural wastage. An average business loses 10 percent of its customers each year, according to DestinationCRM.com, an online site dedicated to discussion of customer relationship management, while cutting customer losses by 5 percent can boost profits by 25 to 125 percent. By maximizing customer satisfaction, you can retain customers for longer so that they continue to make a contribution to revenue and profitability. This has a further effect on profitability because the cost of acquiring new customers is much higher than the cost of increasing sales to existing customers. Value In sectors such as financial services, the top 25 percent of customers account for the majority of a company’s profits, according to Pitney Bowes. Focusing on customer satisfaction and loyalty is therefore essential to maintaining profitability. You can maximize customer satisfaction by delivering what is valuable to your customers so that they continue to come back to you to buy more of the products and services that meet their needs. Lifetime Customer Value The longer customers remain loyal to you, the more valuable they are to yourbusiness. You can use a metric such as lifetime customer value to measure the impact of customer satisfaction on long-term profitability. Lifetime customer value represents the total profits a customer generates while theycontinue to do business with you, according to the software and analytics company SPSS. Recommendation Satisfied customers have an indirect impact on profitability when they share their opinions with other consumers. Social networking sites play an important part in shaping attitudes towards a company and its products. By maximizing customer satisfaction and encouraging customers to post their views on a forum or product review site, you can attract new customers who use the reviews to make their purchasing decisions.

How to Develop an Effective Compliance Audit Process

An effective compliance audit process ensures your company is following regulations and avoiding sanctions. This is especially important in public companies, as these entities are subject to federal examination. By developing and enacting an effective compliance audit process, the company accomplishes two things. First, it gives itself the best chance to catch compliance issues before they become a problem. Second, it shows the federal examiners that the company is doing everything in its power to adhere to the required regulations. Step1 Select a team to perform the audit. For maximum effectiveness, select experienced and highly detail-oriented individuals. Appoint the most qualified candidate to oversee the team. Step2 Segregate different areas of the company to audit. Prioritize the order in which each department will be examined. Start with high-risk areas that are subject to greater regulatory scrutiny, such as accounting or processing. Step3 Obtain copies of departmental procedures for each area you intend to audit. Cross-reference the procedures against regulations to make sure none are in apparent violation. Step4 Review all reports pertaining to production and volume. Use this to determine the sample size to audit. Examining 100 out of 500 loans is a good sample size. Examining 100 out of 10,000 loans will not provide enough information. Adjust the size of your audit team accordingly. Step5 Determine a timeline. Since audits are often disruptive to daily functions, care should be taken to allow the departments to maintain daily routines as much as possible, while still allotting time to complete the review thoroughly. Step6 Create a checklist of items each auditor should observe when reviewing a file. For example, when reviewing a commercial loan file, the auditor shouldreview the underwriting, commitment letter, loan documents, appraisals, environmental studies and supporting documentation. Step 7 Develop a system for reporting your findings and recommendations. Ensure that all information is arranged in a logical and easily understood manner.