Business Ethics

You are right. There are many different opinions about what is ethical. However, mine is quite simple and direct. Here is my definition of business ethics.

"Doing what is in the best interest of your customers, employees, suppliers and associates while making a reasonable profit."

That is about as simple and straightforward as you can get. Now you probably want me to define the word reasonable. That is not too difficult either.

"If I would be willing to pay that price and I would be willing to have my wife and children pay that price, then it is reasonable."

I think we make the question of ethics too difficult. I like to keep everything as simple as possible. If I am not willing to pay $50 for Item A because I don't believe it has a value of $50, why should I expect you to pay it? Now you may argue that value is different to different people. But that really deals with "wants" and not value. For example, I don't shoot pool. I don't want a pool table. You may look at a pool table and say that it has a value of $1,000 while I say it has a value of zero. That is a matter of "wants." The real question in that case would be, "Would the average pool player who wants to buy a pool table be willing to pay $1,000 for that particular pool table?"

Okay, you say. But what about the person who can only buy the product from you? He is desperate. You can sell him something that no one else has. Aren't you providing a service that no one else can provide? Once again, I refer to the question, "Would I want my children to pay that much for the item under those circumstances?" If the answer is "YES" because I understand that they are getting a special service, then it would be an ethical price. I am a capitalist. I do believe in the laws of supply and demand. I believe that everyone (including the oil companies) should be allowed to maximize their profits. I simply believe that they should be implemented in an ethical manner.

I believe ethical guidelines are important for any business. They should be part of a company's policy or employee manual. Your reputation takes years to build but can be destroyed in minutes.

I welcome your comments. Please feel free to post them in the comments section. What do you think is ethical?

Business Networking

YES ..... more has been written on this subject than you could ever read (or want to read). I will most likely not tell you anything that hasn't been written before. Nevertheless, there are some very important aspects upon which all good business networkers agree. I would like to highlight them in this posting.

NUMBER ONE: You can't win the lottery unless you buy a ticket. You can't network unless you go places to meet people. Sitting at home wondering how you are going to get into this company or meet that person will not grow your business. Go to every event you can.

NUMBER TWO: Sit with strangers. When I go to a networking event I look for a table that has people I do not know. Many business people want to feel comfortable by being with people they know. That defeats the whole purpose. Get out of your comfort zone.

NUMBER THREE: Wear a name tag that is big enough for people to read. It doesn't need your company's logo, vision statement, etc. It only needs your name in big, easy to read letters so the people you meet can easily remember your name.

NUMBER FOUR: Do NOT bring brochures and fliers. You are not there to sell. You are there to meet people.

NUMBER FIVE: Bring five times as many business cards as you think you will need. The old saying is that "The most expensive business card is the one in your pocket." Give everyone more than one.

NUMBER SIX: Be prepared with your "elevator speech." You need to be able to describe what you do (not your title or what profession you are in - but what you DO) in one to three short sentences. If someone asks, "What do you do?" and you respond "I'm in insurance." you may as well have stayed home.

NUMBER SEVEN: Make sure you have a pen with you. Writing a few notes on the back of business cards you receive will help you remember something special about the people you meet so you can bring it up the next time you speak with them. You can also use it to write the name and phone number of the person who was too dumb to bring enough cards and doesn't have one for you.

NUMBER EIGHT: Don't sell. Ask questions and listen. Show an interest in the person you are meeting. People love to talk about their family, their occupation, and their hobbies or recreational activities. Ask about any of those and then LISTEN.

NUMBER NINE: Send HANDWRITTEN notes the NEXT DAY via good old U.S. mail to everyone you met. I use note cards with my company name and my picture. I write just a short note saying that I enjoyed meeting them. I may mention something of particular interest that they said. If it is someone I would like to get to know better, I tell them in the note that I will be giving them a call in a few days to see if he/she would like to get together. I would be willing to bet that you will stand out because you will be the ONLY PERSON who sent a handwritten note. And remember, send it the NEXT DAY so you are still fresh in their minds.

NUMBER TEN: Call and set up the meeting.

It's not rocket science - just common sense. Yet most people want to go to a networking meeting and talk, talk, talk, and sell, sell, sell. If no one buys - which they probably won't - the amateur networker makes a mistake by simply moving on to the next event.

I think if you follow these ten rules, you will be a successful business networker. What do you think? I'd like to hear your comments.

Employee Motivation - Part Two

I guess you have all been anxiously awaiting (or maybe not) to hear "the rest of the story." If you haven't read Part One, you probably should do so before reading this posting. Anyway, here is the story.

The employee who worked harder doing his volunteer work than he did on his job was a mystery to me. We were both volunteers at the same organization so when our non-profit organization had meetings, I watched him carefully. He was always leading a fundraiser so he made the typical "fundraiser thermometer" that is commonly used to measure progress toward a goal.

As he was proudly staring at the "thermometer" one evening after a meeting, the light bulb came on in my head. His job at his place of employment had no beginning and no end. He did the same repetitive work each day. There was no goal to hit. There was no means of measurement. He could not stare at a "thermometer of progress" and be proud of his achievement. At the non-profit, he could succeed or fail, win or lose, cross the goal line or be stopped short. At his job, there was no sense of achievement. He had no scoreboard.

The second employee I mentioned in Part One was in a very similar situation. He chose to go to the game because "his" team could win or lose. They could succeed or fail. THERE WAS A SCOREBOARD. There was no scoreboard on his job.

Let's assume you are a football fan. Would you pay $60 for a ticket, $10 to park, $7 for a beer, $5 for a hot dog, etc. just to watch two teams run plays without keeping score? There would be no winner or loser. Of course you wouldn't! You pay to see your team compete and win.

Employees need a scoreboard on their job. They need a thermometer that measures progress. They need something to tell them where they stand. Are they on the 30 yard line or on the 10 yard line? Are they on first base or third base?

When I took over the materials department at a large corporation, there was a significant excess inventory problem. I had never worked in a materials department and was certainly not considered an inventory expert. Within 18 months, I cut the inventory in half. How? Three simple steps. First, I made sure everyone in the department understood why excess inventory was bad for the company. Second, I set numerous objectives (total inventory, inventory turnover, daily receipts, etc.) and covered the walls with charts (scoreboards) to measure progress against each objective. Third, I got the heck out of their way.

Give your employees a scoreboard. Give them a goal to achieve. Give them a target to shoot for. If you do, you will see productivity increase and your company will grow.

What are your thoughts? I'd like to hear them.