FinanceWatchSM Critical financial information, credible sources If you are having difficulty seeing this mail or images in it, you can view it in your Web browser. Volume 10, Issue 2      In This Issue:   [How your firm can] flourish among giants   [Your] image is everything   The democratic way to great IT   Leading IT units drive business change   Top free troubleshooting tools for Windows   New COBRA extension includes some twists   Rehiring ex-employees? Beware these 6 common slip-ups   Greenspan defends low-rate policy   The secret to motivating your team   The 401(k) turns thirty years old   Why teams get locked into behavior patterns   Sharpening your skills: Successful negotiation   Compensation conversations   If accountants ran HR...   Top 10 meeting mistakes   Why forecasts fail. What to do instead   Booking a flight the frugal way If you enjoy this newsletter, read more in our Archive and Explore more Topics and Events or Share this Newsletter: Twitter | Facebook | LinkedIn | [How your firm can] flourish among giants Ten critical techniques for your mid-sized company to compete by keeping a high focus on customers. How thousands of small and mid-sized firms consistently outperform their larger rivals. For more than a decade, I ran the largest M&A company representing middle market companies, most of which were privately owned. During this period, we completed over 1,400 M&A transactions and evaluated thousands of companies. This deep real- world base, combined with my academic research (I wrote several books on mid-sized companies), has given me a certain sense for the critical success strategies that characterize leading mid-sized firms. Small and mid-sized companies are a critical component of modern capitalism. [What does it take for mid-sized firms to flourish among giants? Following are 10 critical success strategies listed in order of importance. Some apply universally; some are contingent upon other factors...] Read the article     Back to top                   [Your] image is everything Discrimination against tattoos in the executive suite I've always been a fan of career management newspaper columns. Particularly entertaining are the round-ups of do's and don'ts during a job interview: Don't bring a mortar launcher to an interview for a senior position with the Pew Charitable Trust. Leave the Monte cristos behind when applying at the Centers for Disease Control. Never drive a Humvee to a job interview with the Sierra Club. Recently, the "Managing Your Career" column in the Wall Street Journal discussed the rather odd experience of a middle-aged executive armed with a solid resume who applied for a CFO post at a hospital in a small Texas town. Despite impressive credentials, she got turned down for the position because when she leaned forward - while wearing a somewhat low-cut blouse - the CEO conducting the interview noticed that she had a large black panther tattoo engraved on her breast. He later explained that his thumbs down to her application was because the tattoo "would not fly with the board members and the community for someone in that position." For many reasons, this is troubling... Read the article     Back to top                   The democratic way to great IT Business leaders and IT leaders working as a team can get more done with fewer resources. Testing, Testing: The New Innovation Game It's all about small changes and crunching the numbers. A former CFO and CIO tells why business leaders should take responsibility for filling their own daily technology needs. Frustration over information technology may be one of the most common attitudes among business leaders. From failed projects and systems degradation to costly downtime and data-security lapses, when it comes to IT it often seems that anything that can go wrong will go wrong, sooner or later. At the same time, though, there may be a sense that IT could be great, given precise prioritization, the right managers, and effective communications with them. But even if companies have those things, the best that most of them can expect is that their IT will be good, not great, according to Susan Cramm, a former chief information officer and CFO and a longtime coach to IT executives. The reason, simply, is that companies... Read the article     Back to top                   Leading IT units drive business change IT is now a critical component in the survival of most companies and it must be allowed to take its place. The IT organization can, and should, do far more than simply act as an order-taker. Instead, the IT function can play an active role in shaping the company's business direction and performance, says a new report from The Boston Consulting Group (BCG). The report, IT Advantage: Spring 2010, is being released today. The report will give CIOs and other IT and business executives much to think about on the topic. It features the results of a survey that BCG recently conducted with MIT's Center for Information Systems Research on the characteristics of IT units that drive business change. The survey found that the benefits of having the IT unit act as a change driver are... Read the article     Back to top                   Top free troubleshooting tools for Windows Tools IT should not be without. These seven handy tools help you diagnose and cure a wide range of Windows ills, and they're all free for the downloading. No computer runs perfectly forever. Somewhere along the line, something will go wrong. While each successive version of Windows has been that much more reliable and self-healing, that's never been an argument to forgo a good collection of software tools. Over the years I've accumulated a slew of third-party troubleshooting apps that have proven their value again and again, so much so that they're among the very first programs installed in any system I use. If something goes wrong --Â a Blue Screen of Death, a slow-booting system, a recent program install that's made everything slower than molasses going uphill in January -- I turn to these tools to set things right. All of them are free for personal use, some are open source, and each of them deserves a place in the toolbox of the savvy Windows user... Read the article     Back to top                   New COBRA extension includes some twists COBRA one month extension and new rules apply... They did it again! Congress just passed yet another extension to the COBRA subsidy . and then some. Here's what you need to know this time. They missed the deadline by a couple of days, but Congress still managed to extend how long your company will have to offer COBRA coverage to recently departed employees. Check out this rundown of what this latest extension means to you:... Read the article     Back to top                   Rehiring ex-employees? Beware these 6 common slip-ups Treat re-hires more like new applicants to avoid these potential traps. Nonunion workforce? You're still covered by the NLRA Here are some NLRA rules that you need to know. As the economy rebounds, you may be looking closely at ex-employees who departed on good terms. Rehiring can slash your job-search time and reduce (or eliminate) training and onboarding costs. About 40% of employers expect to rehire workers this year, according to a survey by consulting firm OI... Read the article     Back to top                   Greenspan defends low-rate policy Regulatory failures yes, but interest rates too low? Greenspan disagrees with John Taylor and says no. In a detailed review of the causes of the financial crisis, former Federal Reserve Chairman Alan Greenspan acknowledged a range of regulatory failures but strongly disputed the widely held view that the Fed left interest rates too low for too long. "We had been lulled into a sense of complacency by the modestly negative economic aftermaths of the stock market crash of 1987 and the dotcom boom," Mr. Greenspan said in a paper, "The Crisis," that he will present at a Brookings Institution conference Friday. "Given history, we believed that... Read the article     Back to top                   The secret to motivating your team The Pulitzer Prize-winning book, "The Soul of a New Machine" by Tracy Kidder illuminates higher goals.    You're the boss: The secret to having happy employees A happy environment encourages higher production and profits. If pay isn't the key to encouraging great performance and attracting and keeping great people, what is? A half-century ago, social scientist Abraham Maslow outlined a pyramid that showed what he called the human being's "hierarchy of needs." People start with a desire for basic physiological needs: food, clothing, shelter - that's the bottom of the pyramid. Once they've achieved those, they seek safety, and then social interaction and love, and then self-esteem. Finally, at the top of the pyramid, is what Maslow called "self actualization" - the need to fulfill one's self, and become all that one is capable of being. Today, most workers - and particularly the best workers - have made their way to the top of Maslow's pyramid. Basic needs are taken care of. They want something more. "Making a living is no longer enough," writes Drucker. "Work also has to make a life." If you want to keep good people, work needs to provide them with... Read the article     Back to top                   The 401(k) turns thirty years old After 30 years, the 401(k) is not likely to go away since pension plans have dwindled to almost nothing. Debt: The Big Hangover Has Only Just Begun All that incurred debt form the Great Recession still has to be paid off, one way or another. The defined-contribution plan revolutionized retirement for U.S. workers. After three decades and the Great Recession, key fixes are needed. Revolutions often begin with drama, a powerful upheaval that seizes everyone's attention. The assault on the Bastille in 1789. The armed insurrection in Petrograd in 1917. Yet sometimes an historic divide is crossed with little fanfare. Only much later is it widely recognized that the world has been fundamentally transformed. That's the case with the U.S.'s main corporate pension plan, the 401(k). The Revenue Act of 1978 contained a provision that become Section 401(k) of the Internal Revenue Code and it went into effect on Jan. 1, 1980. Subsequent regulations issued by the federal government in 1981 gave benefit specialists the guidance they needed to set up the pension plans. The 401(k) has since evolved into... Read the article     Back to top                   Why teams get locked into behavior patterns Old family patterns observed in mental models also form in teams and quickly solidify. Like brothers and sisters at a family reunion, coworkers tend to fall into intragroup behavior patterns, melding into a smoothly functioning yet uncreative team. I used to witness a strange metamorphosis every year in the early fall. The tall, granite-faced men I knew as my uncles and the tall, granite-faced women I knew as my aunts would lose their adult identities and become, once again, a community of siblings. The executive, the bookkeeper, the nurse, and so on would arrive at each annual reunion in western Massachusetts and become instead the eldest, the second-born, the third-born, all the way down to the baby, readopting the well-worn patterns of interaction that had seen them through their mother's death and a lot of other tough times in their Cambridge triple-decker. For me it was both eerie and fascinating, and it gave me a lifelong appreciation for the power of sibling behavioral patterns. Our place in the birth order seems to affect so many things-the jobs we do, for example. Talk to your colleagues, the ones who perform the same work, and see if they didn't come from approximately the same place in the birth order as you. It's uncanny. But it doesn't take an entire childhood for a group's dynamics to get locked in. It can happen quickly... Read the article     Back to top                   Sharpening your skills: Successful negotiation What is "negotiauction", how to use it, and how can gender have an affect? Sharpening Your Skills dives into the HBS Working Knowledge archives to bring together articles on ways to improve your business skills. Questions to be Answered: How is negotiation evolving? How important are opening talks in determining a negotiation's outcome? Can you win against a non-negotiable partner? How can women negotiate past gender stereotypes?... Read the article     Back to top                   Compensation conversations Communication about the value of compensation is key, on all levels, and in many ways. Most talent managers know that effective rewards communication helps motivate employees, build commitment and drive business performance. But that understanding doesn't always translate into action, and discontent and turnover are often the results. Imagine the following scenario: A hard-working professional in the consulting industry laments, "I have not had a pay raise in seven of the nine years I have worked for my firm." When pressed on how she could make ends meet with the rising costs of groceries, utilities, fuel and general living, she said, "Well, I do get a performance bonus tacked on to my final paycheck each year. And my employer still pays the majority of health care premiums. But still, don't I deserve a raise?" This conversation is all too common,... Read the article     Back to top                   If accountants ran HR... Take a look at how HR and accounting departments are different and how they can help each other. Why do so few people understand the fundamental importance of a healthy bottom line? Every company needs to earn more money than it spends (even non-profits need to produce "net capital"). It sounds simple enough, right? Accountants understand to improve the bottom line a business must do one of two things: 1) increase top line revenue; or, 2) reduce expenses. And to produce the largest and fastest positive impact, every business should try to do both. Nothing new here. So, why isn't this equation more infused into the DNA of every organization? For a company to achieve its full profit potential, its subunits (departments, divisions, geographical locations, etc.) should each contribute to the whole by performing well via their own subset profit and loss (P&L) statements. Taken to its natural extension, this thinking would suggest... Read the article     Back to top                   Top 10 meeting mistakes Ten meeting strategies to make your meetings more productive Have your meetings run more rocky than smooth lately? One expert on the subject says there are an array of mishaps to beware of before your next corporate gathering. "Events/meetings are, for most companies, a hidden asset they rarely take full advantage of," says Joe Calloway, Chuck Feltz, and Kris Young, authors of the new book, "Never By Chance: Aligning People and Strategy Through Intentional Leadership." Meetings usually are a waste of time, they say. Before designing an effective strategy, the authors say business leaders need to know the top ten meeting mistakes; focus their objectives, and then execute a meeting plan. Here are the 10 top meeting mistakes, according to "Never by Chance:"... Read the article     Back to top                   Why forecasts fail. What to do instead Focus on the three A's: accept, assess and augment. Forecasting has advanced significantly in recent years. But managers need to understand what they can and cannot predict and develop plans that are sensitive to surprises. Why did no one see the subprime mortgage crisis coming? Because forecasting doesn't work nearly as well as we'd like to believe. Statistical modeling helps extrapolate patterns from past data, but it doesn't predict nearly as well. What are businesses to do, then, in the face of uncertainty? They must aim to be better prepared for disasters... Read the article     Back to top                   Booking a flight the frugal way Booking a flight is no longer straightforward. Here are a few web sites that make it possible to be frugal. It used to be so simple. You wanted to go to Paris, so you called a travel agency, gave them your dates and budget, and with any luck, you soon had in your hands a real paper ticket with a real dollar value. Even in the early days of the Internet, it was easier. You went to one of the few booking sites - Travelocity or Expedia, most likely - searched for your route, paid with a credit card and that was it. Maybe you even got a paper ticket in the mail. Those were the days! Today, however, booking a flight is a total mess. Travelocity and Expedia have been joined by Bing and Orbitz and Dohop and Vayama and CheapTickets and CheapOair and Kayak and SideStep and Mobissimo and and and . I could go on and list every single Web site out there, but I won't. There are just too many. Instead, I'll lead you through the steps I make when I'm booking a flight myself. I've covered this territory a bit before - here and here - but today I'll try to go into more detail... Read the article     Back to top                   Forward to a Friend: Do you have a friend that would like to receive FinanceWatchsm? Perhaps you know a peer within your organization, or associate at a partner company that would benefit from applying to receive this publication. Inviting a friend to experience the benefits of joining the BusinessWatch Network is easy! Just FW: this newsletter to the person you know who may have an interest and ask them to click here http://www.businesswatchnetwork.com Your friend will be glad you did! 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