Yesterday's article from Reuters indicates two voting members of the Federal Open Market Committee warned that interest rate increases may be needed to curb inflationary concerns "even in the face of an anemic economic scenario" in the words of Dallas Fed President Richard Fisher.
So, if you love these low rates you're getting on your line of credit or hate these low rates you're getting on your savings and CD's, get ready for things to possibly change.
The article goes on to say "Central bank officials have expressed concern recently that the United States faces a hint of stagflation, the damaging combination of weak growth and wage-price spiral that hit the economy in the late 1970s and early 1980s, also at a time of rapidly rising oil prices."
"Some forecasters fear that the United States faces a "double-dip" slowdown, with growth likely to pick up in the next few quarters on the back of the stimulus package, before fading again in late 2008 or early 2009."
If you'd like to read the article, here is the link to CNBC's copy: http://www.cnbc.com/id/24864641
GOOD NEWS!!: Okay, here's your dose of good news for the day. . . Crude oil dropped about $4.49 to $126.54 and seemed to hold steady at this price range today.
Thursday, May 29, 2008
Wednesday, May 28, 2008
Is Bigger Really Better?
I was actually reading one of the headlines under the Forbes.com widget to the right of this blog page (scroll down a little) and the headline is "When Bigger Isn't Better" by Melanie Lindner. Ms. Lindner writes about Russ Hamm's Rainbow Broadband which he planned to take national with credit cards and angel capital. "But then something happened that every entrepreneur would be wise to take note: When it came to making money, Hamm and company realized that bigger wasn't necessarily better."
In my fourteen years of banking, this is one thing that I have certainly learned . . . bigger isn't necessarily better. I have seen very successful businesses turn into unsuccessful businesses as a result of growth. Stop. I know you're thinking, "Well, it must have been poorly managed growth." In some cases you are right, in some, the growth put the company into a different arena than it had been in and the companies began to lose their identity, the employees weren't sure who the company was anymore, etc. You're still thinking - poorly managed - aren't you?
I've had the opportunity to work with several entrepreneurs who were smart enough to realize the growth (in their case) was a mistake and they and the Company did better at the lower sales volumes with higher profit margins. Profits were better, there were fewer headaches, fewer employees to deal with, etc. Life was just better. These entrepreneurs altered their plans and began scaling the company back to the more profitable times and reduced staffing through attrition, etc., and returned the companies to the levels of earlier days.
This is not say growth is bad. My point is simply that growth for some people is not as glorious as you might think. By the way, this is coming from a guy who grew to be 5'4" with shoes on. So take it for what it is worth.
In my fourteen years of banking, this is one thing that I have certainly learned . . . bigger isn't necessarily better. I have seen very successful businesses turn into unsuccessful businesses as a result of growth. Stop. I know you're thinking, "Well, it must have been poorly managed growth." In some cases you are right, in some, the growth put the company into a different arena than it had been in and the companies began to lose their identity, the employees weren't sure who the company was anymore, etc. You're still thinking - poorly managed - aren't you?
I've had the opportunity to work with several entrepreneurs who were smart enough to realize the growth (in their case) was a mistake and they and the Company did better at the lower sales volumes with higher profit margins. Profits were better, there were fewer headaches, fewer employees to deal with, etc. Life was just better. These entrepreneurs altered their plans and began scaling the company back to the more profitable times and reduced staffing through attrition, etc., and returned the companies to the levels of earlier days.
This is not say growth is bad. My point is simply that growth for some people is not as glorious as you might think. By the way, this is coming from a guy who grew to be 5'4" with shoes on. So take it for what it is worth.
Saturday, May 24, 2008
How do you handle employee transition?
This past week I ran into an old client at the GLI Small Business Expo and he immediately seemed excited to see me and ready to bash my old employer. It was very disappointing for me as I truly admire my old employer and its employees.
However, one thing I have learned since I decided to leave after 14 years was that we never really mastered how to handle client relationships when an employee left the Company. It seems so simple, but we really did this bad. People didn't leave that often so maybe that could be used as their excuse.
When a person announced their resignation, it was kept very hush-hush, even within the department. Typically, if they were going to a competitor, they were escorted out. (This is common as they don't want client information walking out the door.)
But then, this is where the ball always was dropped. They would then begin analyzing the client portfolio assigned to the person leaving and decide if it should be split up, hire a new person to replace, which accounts should go where, etc. This would take days, weeks, months. I'm not exaggerating. Not only would this take too much time, they would almost try to hide the fact that the person left the Company. No one would call and say, "John, I'm sorry to say that Joe Banker has decided to pursue other opportunities and has left the Company. I wanted to call you personally and assure you that I will work with you directly during this transition and will begin introducing you to the new person handling your account as soon as this is possible. In the meantime, consider me to be your main contact and call me directly if I can be of assistance."
This simple phone call and message would eliminate the pain the clients experience when they call and learn their contact left the Company months ago and no one there felt their relationship was important enough to even make a simple phone call with the message above. Then they get even more mad when they ask, "Well where did Bob go?", and their told they can't disclose that.
I have always believed that open, honest dialogue is the best thing in all interactions with clients, even if the message is not exactly easy.
What is your Company doing during these times of transition?
However, one thing I have learned since I decided to leave after 14 years was that we never really mastered how to handle client relationships when an employee left the Company. It seems so simple, but we really did this bad. People didn't leave that often so maybe that could be used as their excuse.
When a person announced their resignation, it was kept very hush-hush, even within the department. Typically, if they were going to a competitor, they were escorted out. (This is common as they don't want client information walking out the door.)
But then, this is where the ball always was dropped. They would then begin analyzing the client portfolio assigned to the person leaving and decide if it should be split up, hire a new person to replace, which accounts should go where, etc. This would take days, weeks, months. I'm not exaggerating. Not only would this take too much time, they would almost try to hide the fact that the person left the Company. No one would call and say, "John, I'm sorry to say that Joe Banker has decided to pursue other opportunities and has left the Company. I wanted to call you personally and assure you that I will work with you directly during this transition and will begin introducing you to the new person handling your account as soon as this is possible. In the meantime, consider me to be your main contact and call me directly if I can be of assistance."
This simple phone call and message would eliminate the pain the clients experience when they call and learn their contact left the Company months ago and no one there felt their relationship was important enough to even make a simple phone call with the message above. Then they get even more mad when they ask, "Well where did Bob go?", and their told they can't disclose that.
I have always believed that open, honest dialogue is the best thing in all interactions with clients, even if the message is not exactly easy.
What is your Company doing during these times of transition?
Wednesday, May 21, 2008
BREAKING NEWS!
This just in from the Associated Press: "The Federal Reserve on Wednesday sharply lowered its projection for U.S. economic growth this year, citing blows from the housing and credit debacles along with zooming energy prices. It also expects higher unemployment and inflation."
Okay, maybe I was a little dramatic like Fox News, but, is anyone shocked by this? Has no one been reading my blog for the last few months? (I know the answer to that so don't bother answering.)
I was at the GLI Small Business Expo and 9 out of 10 businesses are saying the same thing, it is slow. Gas prices are killing business.
The Fed is indicating rates will likely not be cut anymore as inflation is a concern. The projected inflation rate was increased 1% to an expected range of 3.1 - 3.4% and the projected unemployment rate was also increased to 5.5 to 5.7% from last year's 4.3% average.
So what do we do? I say we all take a lesson from Tony Dungy's book outlined in my previous post and "keep doing what we do". Obviously we need to prepare our businesses for possible continued slowness and watch any frivolous expenses, etc. But I think we keep doing what we do. Keep winning the small battles, keep providing excellent client service, keep coming up with new ideas, keep in front of your clients, keep in front of your employees, vendors, suppliers, etc. Buy wisely and be sure to manage margins. Sales are no good to anyone if they don't make financial sense for your business. Don't manage the top line, manage the margins. These are the only numbers that really mean anything.
Call me and let's discuss the challenges your facing. Maybe a fresh set of ears can help with some fresh ideas.
Okay, maybe I was a little dramatic like Fox News, but, is anyone shocked by this? Has no one been reading my blog for the last few months? (I know the answer to that so don't bother answering.)
I was at the GLI Small Business Expo and 9 out of 10 businesses are saying the same thing, it is slow. Gas prices are killing business.
The Fed is indicating rates will likely not be cut anymore as inflation is a concern. The projected inflation rate was increased 1% to an expected range of 3.1 - 3.4% and the projected unemployment rate was also increased to 5.5 to 5.7% from last year's 4.3% average.
So what do we do? I say we all take a lesson from Tony Dungy's book outlined in my previous post and "keep doing what we do". Obviously we need to prepare our businesses for possible continued slowness and watch any frivolous expenses, etc. But I think we keep doing what we do. Keep winning the small battles, keep providing excellent client service, keep coming up with new ideas, keep in front of your clients, keep in front of your employees, vendors, suppliers, etc. Buy wisely and be sure to manage margins. Sales are no good to anyone if they don't make financial sense for your business. Don't manage the top line, manage the margins. These are the only numbers that really mean anything.
Call me and let's discuss the challenges your facing. Maybe a fresh set of ears can help with some fresh ideas.
Need a Good Read?
I am nearly finished reading "Quiet Strength" by Tony Dungy with Nathan Whitaker. It is written as a Memoir and is also available in an abridged version on audio CD and actually spoken by Tony Dungy.
It's a great story and there are definitely things to take away from the book as life lessons. I had always heard that Coach Dungy was a very religious man but was surprised at how deeply religious he is. He truly is an inspiration on many fronts.
He basically sums it up that life is about "touching lives, building a legacy not just on the field but in those places that most people will never see. Trying to be faithful in the position God has given me. My purpose in life is to glorify God. Be careful not to let the pursuit of life's goals, no matter how important they may seem, to lose sight of our purpose."
I also like Coach Dungy's perspective that we are basically living out God's plan. I have always believed this personally feeling like God basically has a blueprint and set of plans for my life and I was basically living out his plan. Coach Dungy explained when he was fired by Tampa Bay, he believed that God was ready to place him somewhere else, he didn't know where yet, but he knew God would soon tell him. He was soon "placed" with the Colts.
Sunday, May 18, 2008
Ninja Warrior - Bell Style
Okay. If you have young boys in your house, you'll know what I'm talking about. If not, who knows, maybe you channel surf and have stopped here before. There is a show on the G4 network (Channel 61 on Insight Cable) called Ninja Warrior. I had heard my boys talking about the show before and was concerned it was similar to wrestling though I imagined it being more real with "ninjas" beating each other up on TV. This past week or so, I discovered it was not that at all but rather a fairly entertaining show where individuals try to complete very rigorous obstacle courses. It's a little like American Gladiators without the Gladiators as opposition. It's basically the competitor against the course.
Most of the show is announced in Japanese with English subtitles. Today happened to be an all day airing of episodes of Ninja Warrior so we have seen a couple episodes. As we're watching, I make the mistake of talking out loud in front of my wife how difficult I think some of the obstacles are and explaining that I think I could complete some of them but certainly not all of them. She starts laughing out loud at me. I know she is thinking I'd be lucky to complete any of them.
So I start explaining that as a kid, we would do this type of stuff in our house or around the neighborhood. She again laughs out loud and says something like, "Yeah, when you were a kid."
I, being a competitive person, decide I will show her how I used to walk up door frames in the house and drive my mother crazy. Terri thinks I'm nuts as I start to position myself between the door frame, but is astonished, when I actually walk up the frame with my hands and feet to the ceiling. (Okay, maybe astonished is a little strong.)
Well, the second mistake I made this evening was allowing Matt and Mark to witness my incredible talents as now they are "flying spiders" all over the house walking all the door frames and timing one another as they do it. We have created monsters, err, "spiders" in the house who are convinced they could compete on Ninja Warrior.
Most of the show is announced in Japanese with English subtitles. Today happened to be an all day airing of episodes of Ninja Warrior so we have seen a couple episodes. As we're watching, I make the mistake of talking out loud in front of my wife how difficult I think some of the obstacles are and explaining that I think I could complete some of them but certainly not all of them. She starts laughing out loud at me. I know she is thinking I'd be lucky to complete any of them.
So I start explaining that as a kid, we would do this type of stuff in our house or around the neighborhood. She again laughs out loud and says something like, "Yeah, when you were a kid."
I, being a competitive person, decide I will show her how I used to walk up door frames in the house and drive my mother crazy. Terri thinks I'm nuts as I start to position myself between the door frame, but is astonished, when I actually walk up the frame with my hands and feet to the ceiling. (Okay, maybe astonished is a little strong.)
Well, the second mistake I made this evening was allowing Matt and Mark to witness my incredible talents as now they are "flying spiders" all over the house walking all the door frames and timing one another as they do it. We have created monsters, err, "spiders" in the house who are convinced they could compete on Ninja Warrior.
Wednesday, May 14, 2008
Dear Diary.
Okay. Today is going to be random thought. I have been sitting here for the past couple hours going through a 6 inch stack of bills, envelopes, etc. trying to make sure we were paying all our bills on time. Ugghh. Does anyone else have this trouble? We started throwing our mail in a plastic bin each day and now seem to find that you can only get to it every once in a while. Fortunately, the bills were in decent shape. But it is scary. I am convinced that auto debit is the way to go for about everything. I use Quicken and online banking to try to make life easier and it still is cumbersome.
The news is on and there are speculations that GE is going to auction Appliance Park. That's sad news for Louisville. GE has been a part of my life since birth. My Dad retired a few years ago as a Manufacturer's Representative that sold for companies to GE along with his brother. I worked as a co-op at GE Appliance Park during college. It has been a Louisville institution for so long that everyone in town probably knows someone who works there or is involved with a company that does business with them. Hopefully, if it sells, the buyer will see value in keeping the plant in operation here in Louisville.
Are you sick of hearing about and talking about gas? I am too but here I go. I bought gas yesterday, the lowest octane and it costs $3.95 per gallon. The premium was $4.15 per gallon. I spoke with a lady today that said her husband's F-150 truck costs $100 to fill. Where does it end? Will gas really reach $5 per gallon as some reports are indicating?
The news is on and there are speculations that GE is going to auction Appliance Park. That's sad news for Louisville. GE has been a part of my life since birth. My Dad retired a few years ago as a Manufacturer's Representative that sold for companies to GE along with his brother. I worked as a co-op at GE Appliance Park during college. It has been a Louisville institution for so long that everyone in town probably knows someone who works there or is involved with a company that does business with them. Hopefully, if it sells, the buyer will see value in keeping the plant in operation here in Louisville.
Are you sick of hearing about and talking about gas? I am too but here I go. I bought gas yesterday, the lowest octane and it costs $3.95 per gallon. The premium was $4.15 per gallon. I spoke with a lady today that said her husband's F-150 truck costs $100 to fill. Where does it end? Will gas really reach $5 per gallon as some reports are indicating?
Mary Ann Simms - Rest in Peace
Yesterday I learned that my lifelong friend, Tom Simms, lost his mother to an eight week battle after a stroke she suffered. I have been friends with Tom since we were in the 1st or 2nd grade. My real first memory of our relationship is from second grade when Tom sat in the desk directly in front of me. Tom was always one of those really good guys and still would do anything to help out a friend.
Mr. and Mrs. Simms are the epitomy of good parents. I grew up with Tom as we would ride our bikes over to one another's house every day. Mr. Simms worked 6 days a week to provide for his family which included Tom and his older brother, Steve, and little sister Monica. Mrs. Simms worked tirelessly at home to provide the best home for her children and husband. They lived a very modest lifestyle while sending their 3 children to Catholic grade school.
Even though I'm sure money was tight, as kids, it seemed the Simms' had everything. Tom and Steve always had the coolest toys, the latest game systems (back then, I think this basically meant they had atari), etc. Tom was taught to work hard by his parents, he was taught respect and discipline.
Mrs. Simms had not changed a bit in the past 30 years that I've known her. She always seemed to be the same. I was fortunate to be able to see her in recent years when she attended her grandson, John's baseball games. John plays in the same league as my son.
Mrs. Simms' passing makes me realize what an impact the parents of my friends have had on me. I had never really considered this before but not only did they impact my friends' lives, they impacted my life.
Thank you for everything Mrs. Simms and especially for making Tommy the man that he has become. May you rest in eternal peace.
Mr. and Mrs. Simms are the epitomy of good parents. I grew up with Tom as we would ride our bikes over to one another's house every day. Mr. Simms worked 6 days a week to provide for his family which included Tom and his older brother, Steve, and little sister Monica. Mrs. Simms worked tirelessly at home to provide the best home for her children and husband. They lived a very modest lifestyle while sending their 3 children to Catholic grade school.
Even though I'm sure money was tight, as kids, it seemed the Simms' had everything. Tom and Steve always had the coolest toys, the latest game systems (back then, I think this basically meant they had atari), etc. Tom was taught to work hard by his parents, he was taught respect and discipline.
Mrs. Simms had not changed a bit in the past 30 years that I've known her. She always seemed to be the same. I was fortunate to be able to see her in recent years when she attended her grandson, John's baseball games. John plays in the same league as my son.
Mrs. Simms' passing makes me realize what an impact the parents of my friends have had on me. I had never really considered this before but not only did they impact my friends' lives, they impacted my life.
Thank you for everything Mrs. Simms and especially for making Tommy the man that he has become. May you rest in eternal peace.
Sunday, May 11, 2008
Is it May Already?
Man, it must have been busy these past few weeks. I have not looked at or posted to this blog since March. Terri and I have been busy with many things and just wrapped up our annual festivities centered around the Kentucky Derby, the greatest two minutes in sports.
We have an annual Derby Bash that has about 100 people traipsing through our house and lawn. We had family in from California and many friends and family over. We always have a blast with it but of course it is a lot of work and planning. Terri thankfully takes care of 99% of the pre-work.
This weekend we celebrated mine and Terri's 17 year "Dating anniversary". Yes, we do recognize our dating anniversary, the first time I bought her lunch at Subway. I think the only reason we really know the date is because it was 2 days before her birthday.
Speaking of her birthday, yesterday was Terri's birthday and today is Mother's day. Busy weekend for Hallmark at the Bell household. I spent $16 dollars on greeting cards at Kroger and that didn't include my Mom's card or my Mother-in-Laws card. Did you know greeting cards cost over $4 now? I swear I'm going to start sending e-cards to everyone.
While I'm up here on my soapbox, did you pay attention to the price of gas or a barrel of oil this week? We hit $126 per barrel on Friday and gas at Swifty (the cheaper place that lines up every week) was $3.75 tonight. According to the Tehran Times, "the U.S. investment bank Goldman Sachs forecast an oil price of more than $200 a barrel within two years." I recently read where the 5 year oil futures were trading in excess of $100 which would indicate these prices are here to stay.
I think I have mentioned before on here that I am a big fan of Jeffrey Gitomer's. He's the sales guru whose articles you often read in Business First. I think this is where I first started reading Gitomer's articles on sales. He has a quirky sense of humor that I like. His ideas are sometimes over the top but the thing that strikes me most is he is going to have FUN.
I already have read many of his books with probably my favorite being "The Sales Bible". Well, he just released an updated version of The Sales Bible and as much as I enjoyed the first version, I couldn't pass on the updated version. While I was visiting the Amazon.com site, I also picked up copies of "SPIN Selling" and "The SPIN Selling Fieldbook" by Neil Rackham. I went through SPIN training a couple years ago with people from Huthwaite and figured I would study up on the old training to see what I had actually implemented from the training and what I could continue to work on in the future.
I like the idea of walking the client through their daily processes and leading them down their own road to what they are needing. If I can help with their needs then great, if I can't, that's great too. At least we've identified the needs and whether or not I can help.
I will try to post some of my thoughts on these reads once I have received them and read through them. I am anxious to receive them.
We have an annual Derby Bash that has about 100 people traipsing through our house and lawn. We had family in from California and many friends and family over. We always have a blast with it but of course it is a lot of work and planning. Terri thankfully takes care of 99% of the pre-work.
This weekend we celebrated mine and Terri's 17 year "Dating anniversary". Yes, we do recognize our dating anniversary, the first time I bought her lunch at Subway. I think the only reason we really know the date is because it was 2 days before her birthday.
Speaking of her birthday, yesterday was Terri's birthday and today is Mother's day. Busy weekend for Hallmark at the Bell household. I spent $16 dollars on greeting cards at Kroger and that didn't include my Mom's card or my Mother-in-Laws card. Did you know greeting cards cost over $4 now? I swear I'm going to start sending e-cards to everyone.
While I'm up here on my soapbox, did you pay attention to the price of gas or a barrel of oil this week? We hit $126 per barrel on Friday and gas at Swifty (the cheaper place that lines up every week) was $3.75 tonight. According to the Tehran Times, "the U.S. investment bank Goldman Sachs forecast an oil price of more than $200 a barrel within two years." I recently read where the 5 year oil futures were trading in excess of $100 which would indicate these prices are here to stay.
I think I have mentioned before on here that I am a big fan of Jeffrey Gitomer's. He's the sales guru whose articles you often read in Business First. I think this is where I first started reading Gitomer's articles on sales. He has a quirky sense of humor that I like. His ideas are sometimes over the top but the thing that strikes me most is he is going to have FUN.
I already have read many of his books with probably my favorite being "The Sales Bible". Well, he just released an updated version of The Sales Bible and as much as I enjoyed the first version, I couldn't pass on the updated version. While I was visiting the Amazon.com site, I also picked up copies of "SPIN Selling" and "The SPIN Selling Fieldbook" by Neil Rackham. I went through SPIN training a couple years ago with people from Huthwaite and figured I would study up on the old training to see what I had actually implemented from the training and what I could continue to work on in the future.
I like the idea of walking the client through their daily processes and leading them down their own road to what they are needing. If I can help with their needs then great, if I can't, that's great too. At least we've identified the needs and whether or not I can help.
I will try to post some of my thoughts on these reads once I have received them and read through them. I am anxious to receive them.
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