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Not all attrition is bad. Planned attrition is desirable for the growth of your business.

I know of a small scale businessman, who after losing a few trained hands

did the most desperate thing. He limited his employees’ access to training and product information to make them unattractive to poachers.

He effectively stalled the growth of his own, flourishing company.

Planned attrition could in fact be desirable for the growth of your business. That is why smart organizations don’t act in haste when they begin to lose trained employees to rivals. They respond by devising innovative retention solutions, unique to their business needs. This post is about these unique, retention strategies.

According to Manpower Inc., a leading, HR Services firm, the global best practice is to measure retention, the cost and causes of unplanned attrition. A small business owner should ask herself: “Why are people leaving me?” And, more importantly, “What can I achieve in terms of customer satisfaction and profits with a 10 percent improvement in retention”?

The analysis can be very revealing. By a conservative estimate however, the cost of replacing a trained employee can be roughly 0.41 times his/her salary. (Source: Conference Board, a Washington, DC-based workplace think-tank.) This does not include the opportunity lost, so imagine the colossal waste when a talented worker decides to make an unplanned exit!

Talent is the fuel that drives a small business

When Nobel Prize-winning economist Gary S. Becker coined the term “human capital” things were vastly different. Today, people drive business. They are the assets and market capitalization of a company. And when they leave your company in the evening, the value of your business is zero. Attracting and retaining talent is one of the most vital functions of an organization today.

Share information; be open

Employees need information to perform. Very often, the difference between a star performer and the not-so-star is just information. This additional information could be could be your plans, vision, minor and incremental updates, and it could be of no consequence in the immediate term but could prepare the employee for a greater role in the organization. An unfettered access to knowledge tools ensures that everyone can claim an equal share in the success of your business.

Salary is just a hygiene factor – not a motivator

If you ask what motivates employees, it’s not what comes to their bank account at the end of the month. It’s about what they do every moment and their view of what their work life will be going forward. For most people, it’s not about salary. Unless, salary is lower than their expectations.

Often, good working environment, work culture, learning and development, is rated as a top retention tool. People are also attracted to freedom to choose projects they want to work on, job rotation etc.

Refine your hiring process

Try to fix the problem where it starts. You have to get in the right people in order to keep them there. Identify the gaps in your recruitment process and begin to plug them systematically. If you bring in a misfit, the person will leave eventually. If you bring in the right person (role-wise, aspirations-wise, compensation-wise, culture-wise) the person stays and wants to excel. If not, it’s just a matter of time.

Let candidates experience your workplace

A good strategy, could be to let prospects “experience the role” by visiting your workplace and interacting with current employees, before they are asked to make a decision about accepting the offer. In my experience this can sometimes stem attrition by almost 50%!

Assess your manpower needs clearly, so you don’t hire in a hurry, or oversell the job to someone who is unable to eventually meet your skill needs.

Listen to your employees; don’t underestimate the value of an exit interview

When an employee comes back to you with a problem, listen patiently. They could be wrong. You could be right. But listen to them. And listen to them often. Take feedback often. Ask them if they are enjoying their work, if something is hindering their performance, what else you could do to help them perform better.

Never commit the mistake of not asking feedback. If you don’t they think you don’t bother about them. If you ask, it tells them that you value them and their opinion.

If the employee does leave, take an exit interview. The feedback gathered, in a relaxed, non-judgmental climate can be extremely helpful in addressing core attrition issues.

About: p2w2 is an online marketplace for services like writing, accounting, software, graphic design, virtual assistance, research etc that can be fully delivered online. Small businesses in the US and Canada can use p2w2 to outsource their service requirements for faster execution and time to market.

Picture credits: “Excited Employee”(top) Photo Mojo; Peacock in full plumage with its extravagant tail (middle) Arindam’s PhotoWorld; Employees only emdot

LinkedIn is a good tool. But it’s boring. When was the last time you found something funny in LinkedIn? Yeah. There are articles talking how to use LinkedIn. But most of them are equally boring laundry lists of all LinkedIn can do. Not something that will be useful to you. Some just waste your time. “Talk to [people] on phone” lists LinkedIn’s own blog as one of the things you can do using LinkedIn. That list has no meaning for a small business. As a small business owner, my priorities are simple. Generating revenue is one of the highest priorities I have. Can LinkedIn contribute to that? How?

Using LinkedIn is about how you get in touch with people, and do business with them in various contexts. Below are some practical ways to help you in your small business.

Account opening and lead generation

If you have list of target customers (individuals), titles or companies, search them. You can search by industry, current or previous titles, current or previous companies, within a postal code etc. Get your target list of individuals in this search. Then figure out the most trusted route to those individuals. The most trusted route is the connection to the target through a first degree connection. You could preferably ask for a referral and you have a leg-in the company.

Finding the decision makers and influencers

When you sell to large corporations, understanding who you are talking to and who the decision maker/influencer will help you strategize your sale. There’s no use selling to someone who can’t do much. Using LinkedIn, you can find out who the decision maker is and could have alternative ways to reach them. You can do it by looking at job titles in an organization. But very often, that gives you partial and incorrect information. You can get more accurate and ‘tacit’ information by gathering information from others in the company.

Accumulate reputation and make referrals long lasting

Recommendations feature in LinkedIn has an eBay or p2w2 effect on your reputation. All your contacts can see it and are on for a long time. It’s an accumulation of your online reputation. When you delight a client, ask them for a LinkedIn recommendation. Those who visit your profile can see your reputation. In the offline world, a referral you get can only fetch you a few contracts. But here, you can make the recommendation long lasting and touch many more than just a few referrals.

Follow your customers and de-risk from personnel changes

With LinkedIn, when your clients shift from one company to another, they move with you because you connect with the person – not the company. That’s good for you. With your contact’s move, there’s a known person in the new company that gets your leg into the company (that’s assuming you have good terms with the client. If you have bad reputation, it moves across companies too.)

Using the same strategy to know the ‘influencers,’ i.e. making your connection wide within the company so that when your key contact leaves the company, you have others to fallback on. You de-risk your account from personnel changes.

The above are the ways you can generate revenue. If you are keen on exploring more about this, I suggest you read this eBook (Can LinkedIn increase your sales) published by Jill Konrath. Pages 5-8 have the crux of what this eBook has to offer. It’s worth the read.

Tap into push button expertise; position yourself as a subject matter expert

LinkedIn Answers has been reasonably successful. We wrote about it in our previous post (5 good marketing and HR websites for a small business). If you ask a question related to your business, you can be reasonably certain that you get multiple good answers. As a small business, you have many questions and few answers. You can use LinkedIn Answers to tap into expertise of many people. Just ask.

Alternately, you can position yourself as a subject matter expert in the subject you want to be viewed as an expert and answer questions posed by others. The more ‘best answers’ you accumulate, the better you will be treated an expert in your subject.

In my opinion, the above covers the ‘high impact items’ of how LinkedIn can help small businesses. That gives you 80% of the value understanding 20% of the items. If you are really interested looking for a laundry list (other other 80%) of all you can do on LinkedIn, here are a few links that will help you do just that.

20 Ways to Use LinkedIn Productively

Ten Ways to Use LinkedIn

The Right Way to Use LinkedIn

Picture credits: 1. LinkedIn (top): Mario Sundar 2. Enlightening (middle): Jurvetson 3. Sunset & the Thinker (bottom): Esparta

Small businesses have different DNA. If you are a small business, you are small, with limited budgets and they have a lot to do. You constantly have this urge to ‘scale up’ – in revenue and people. You have meager resources and employees. And face high risk. So want stuff to work out-of-box and give you returns.

That’s why we have put together 5 great resources for small businesses that will help you. These resources will give you strategic assets. Like if your employees use Manager Tools, they will be far better employees right away and that improves the quality of employees you have without having a pay a bomb to a soft skills trainer. The other resources below are equally good.

Marketing voices

Marketing Voices is one of THE best Internet marketing podcasts I have ever heard. Jennifer Jones, the host, interviews the who’s who of social media marketing and you get to hear the cutting edge of Internet marketing. Of late, the podcast has become shorter and better. Jennifer Jones hits the nail on it head and gets it over with. There are no long conversations. She does not look to fill the time as much as she wants to give the most within the shortest span of time.

SpyFu.com

SpyFu is a very different resource. It’s a website where you can key in a competitor’s website and get great competitive insight on PPC (pay per click) and Organic search results. E.g. You can get how much ad budget your competition spent, on which keywords, who the major competitors for certain keywords are, and on which keywords does the website rank high in organic search results.

Manager-Tools

Manager-tools is a podcast that gives ‘tools’ to managers. Michael Auzenne and Mark Horstman strike a conversation every week about soft skills – how to manage your time, how to leave voice mails, how to have one-on-one conversations with people who work for you. What I like about the podcast is that the suggested behavior is sensible and practical. Though they do talk about what managers do wrong, they do that well and only enough to make the point.

If you wanted a mentor who taught you or your employees what to do, you can find one in Manager-tools. If used well, Manager-tools can convert ordinary employees into strategic assets and can influence the culture of your company positively.

LinkedIn Answers

You may know LinkedIn but am not sure if you know the power of LinkedIn Answers. Whatever questions you face in your business, you can pose that in LinkedIn and get very good responses to your questions. What’s even more wonderful is that you can search the archives and see if someone else posted the same question and check out what the responses have been. It gives you insights from multiple experts (or not so experts) at the same time and saves you time.

Entrepreneur.com

You can find many articles of topics important to you entrepreneur.com. What I like about entrepreneur.com is sensible advice. E.g. Check out this article - How to Sell in 60 Seconds. The author upgrades your selling capability. There’s a large archive of such articles.

I hope you enjoy these resources. If you know some other resources that are as good as or better than these websites, please let me know. Many small businesses read this blog. You will be able to help them by telling me.

Picture credit: tanakawho

Welcome to this week’s p2w2 Small Business Links (p2w2-SBL) post. In p2w2-SBL we bring you the best resources available on the Internet on this topic. Today, I focus on how twitter can help your business.

Create unbelievably valuable network, meet potential collaborators and find extraordinary business leads

“Just by way of writing, reading and responding to each other’s tweets, unbelievably valuable networking contacts have become familiar workday presences. I’ve met and hired 3 subcontractors for my business, met numerous potential collaborators and even found extraordinary new business leads. I’ve been to numerous networking and social events (lifesavers for a WAHM in a new city!). Interesting, creative, challenging, thoughtful and very deeply caring people have come into my life. New ones seem to appear every week. Twitter has served up answers, opinions and inspiration.” (Laura Fitton: Ode to twitter)
“Do you have a brick and mortar business? Connect with your local clientele by using TwitterMap.com or TwitterLocal.net. These sites will show you all the Twitter updates happening in any given geographic area. Sign into your Twitter account and enter “L: city, state” and then visit TwitterMap or TwitterLocal to find “Twits” near you.”(Carrie Hill: Small Business Owners Need Twitter and LinkedIn)

“How could I hire a stranger to work on an important project? Simple. I knew enough about her from Twitter to be confident she could do the work. Her authentic behavior in the [Internet] told me she was intelligent and articulate. When we briefly stepped into the real world, I quickly confirmed this. And her work was outstanding.
The most valuable social networks, and the most valuable contacts within those networks, are based on trust. Most of my Twitter friends are people I have never met in person and with whom I had no connection prior to twitter. Twitter provides exactly the right environment in which to build trust.”(Joel Postman: twitter is the new anti-metaverse)

twitter is the new discovery channel

“Twitter has become my best way to discover. Discover cool websites….discover blogs, podcasts, even breaking news… It has been an amazing and inspiring resource.” (twitter is new discovery channel)

“We also combine the power of our collective news/intellectual interests. I get the “best of” ideas that various Twitter friends read or create, any given day. This magnifies the depth and breadth of information I consume.” (Laura Fitton: Ode to twitter)

Twitter is a sounding board. Get advice, directions and support

“Twitter is a sounding board. CEOs of large companies ask questions about products and strategy. Small businesses can do the same.” Joel Postman

“I use Twitter to ask for advice, directions, support, and to ask others for their open-ended interpretations to general questions.” (Chris Brogan: Newbies guide to twitter)

Build traffic; Engage your customers and get insights into your business

Martin Bowling

Twitter helps engage your customers by offering them valuable information and insights. By talking to your customers in a high trust environment, you can get insights into your own business with unmatched depth and volume.

“Building links to a small business Web site? Follow people who can help you out, engage in the community and when they call for help/suggestions, offer yours” (Carrie Hill: Small Business Owners Need Twitter and LinkedIn)

Twitter is Answers (like Yahoo! Answers), a chat room, a water cooler, an advertising tool and more rolled into one.

If you realized twitter’s potential the first time you saw it, you may be a genius. Because, not even Evan Williams, its founder, could have guessed how useful twitter was going to be. Lots of people, including me, can’t figure out the first time why they should use twitter.

“Frankly, twitter went from “what the heck” to “how the heck did I live without this?” very quickly.”

“I began to see how creative/productive Twitterers can inspire. I used it to surround myself with role models. I started getting to know people, and to enjoy the company, humor, conversation and great links.” (Laura Fitton: Ode to twitter)

Twitter is Answers (like Yahoo! Answers), a chat room, a water cooler, an advertising tool and more rolled into one. You can derive value out of it by spending time and connecting with people on it.

Picture credit: Sitting on the toilet http://www.flickr.com/photos/cambodia4kidsorg/

Have you ever finished a meal at a restaurant and found the experience not worth your time and money? The waiter was not attentive enough, the food was stale, options were limited and finally you got the overall feeling that the management did not really appreciate your business as your attempts to request better service were ignored.
You just joined the dissatisfied customers club.

Could I get some service please? Picture credit: http://www.flickr.com/photos/mandj98/

Most know an unsatisfactory service when we are receiving it. Are we able to think for our own customers and go the extra mile to make their experience delightful?
p2w2 provides you with nuggets from the collective experience of all our users to make your more successful in building a lasting partnership with your customers.
p2w2 Blog had a great post recently on Pitfalls in Supplier Relationship Management. Interestingly, most of those points could apply in the other direction too. Suppliers too can at times get too fat and arrogant and succumb to the same pitfalls. They stop relating to the individual(s) behind the client organization, seek to squeeze too much by atrociously charging for every additional service request, adopt the “take it or leave it” approach when the client is trapped in a dire situation and finally, make every decision a matter of ego.

Another great post is on Freelancer Essentials, and it talks about how to establish as a reliable service provider. I will extend on these posts.

In my own career, I have gained a lot from working with seasoned professionals in customer relations. The need to manage clients and internal teams across the globe makes it even more challenging! This post draws from my experience on the bare essentials in establishing great relations with your clients.

View it from long-term client relationship perspective

In the services business, upwards of 70% of revenue comes from repeat business. Most of the new business comes from referrals from your existing clients. Effectively, your current clients can make or break your current revenue and its growth. What does that tell you? Every issue you have with your current clients should be viewed as if it affects growth of that account as well as a few other accounts. That’s the long term view. If you think it affects your current deal, you can move past that. That’s the short-term view. Which one do you follow?The right approach is to work together to get to a partnership, where both sides care for and actively work towards each other’s success. You give feedback to the client where if affects your business and the other way around. Not every client wants only the best price. They need relationships, timely service, and even references from you so your client can get other clients!

The Expansive Relationship of Two Individuals as An Independent One. Picture Credit: http://www.flickr.com/photos/derricksphotos/

Brighten the relationship with out-of-work activities

Partners share other interests too outside of work. Connect with your customer by finding out shared interests apart from just timely delivery of the agreed services. Photography, blogs, parties, baseball, soccer or Ping Pong… What does your client love to talk about? If you have similar interests, talk about them. If you know other people who have common interests, or can be of help to your clients, connect them. Your client will appreciate that and help you when you are in need.

Ask for feedback; Listen to your customer

Don’t pay lip service to listening to your customers. An often used, but usually poor strategy, is to use someone else (either outsourced, or a different administrative department) to survey your customers.

Your must ask for feedback frequently - what are we doing well for you? Where can we improve? Most people shy away from asking.

There are many benefits from asking for feedback.

First, it gives your client a platform to vent their feelings. You must patiently listen to her. That itself shows to the client that you give importance to her. You are one step closer to satisfying the client.

Second, it helps you narrow the gap between client’s expectations and your performance.

Third, you can figure out if there’s something you have but does not cost much for you but has a lot of value to your client. Discovering such aspects creates mutually beneficial relationship.

Put yourself in your client’s shoes

When you are at the receiving a service, consciously evaluate it. I have personally found this useful.When you are at the doctor’s office, waiting to talk to your bank’s service desk or requesting support from your internal technical/HR/facility helpdesk – were you treated the way you would have liked? What did you like? What should have been better? How can you apply that in the way you deliver service to your clients?

Bad news does not age well

The earlier you tell your client, the better the chance of working together on reducing the impact.

To deliver the message faster and to mitigate the impact, You can set up regular status meetings and using the meetings to disclose or warn about bad news. Being too early is better than being late at all.

Never defend the indefensible

When you make mistakes, accept them. Being passionate about your work and your team is noble. But nobody is perfect and at times we all make mistakes. Mature customers understand there are problems once in a while. Your ability to recover is as important as your ability to avoid most of them. Accept your faults and move on.

Customer is never wrong about the results s/he wants

Customer is sometimes wrong - but they are never wrong about the results they want (e.g. better service quality, faster deliver), but they may often be short- term focused and less knowledgeable about how they want you to achieve it. When a customer tries to tell you how to run your business, you should have the confidence in your own abilities to not let any pressure distract you from applying the right solution to deliver the right results.

Part amicably when things are simply not working out

Finally, there are times when your value systems simply do not match with those of customer’s. When there is too much interference that cramps your style of doing business or you are unfairly treated, it might require you to walk away. If a dialogue with the client does not produce a solution, move on. But you should part amicably. Parting amicably is always better than a bitter lawsuit! But parting amicably gives the client a chance to come back and talk about other opportunities she may have and retains a bit of reference value of that client for you.

Keep track of your goal

At a very high level, these are basic common sense points that we apply in most of interactions in our social circle. But the daily rigmarole can sometimes make us lose track of these when we deal with our clients. Being watchful and not losing sight of what we have set out to achieve – a successful, well run business – should keep us right on track! I would love to hear from you on any other advice you might have for us and your fellow small business colleagues here at P2W2. Please do leave your comments!