January 2019 Te Contractor’s Advantage
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Setting Goals and Looking Ahead Into the New Year
For a lot of people, January is a month of setting goals and resolutions. It’s a time of looking ahead and planning for the future. As for myself, well, I am very much a goal setter! I keep spreadsheets with my goals, which I update weekly. On Friday afternoons, I sit down and check in with myself, updating what I’ve accomplished toward each goal. A big part of my goal-setting process are set points. Nearly every goal I work on has a set point — markers I set along the way to completing a goal. A set point is a way to hold myself accountable and make course corrections if I need to. For example, if I wanted to lose weight — or maintain a certain weight — a set point would be getting on the scale every Friday morning. If I’m maintaining the “goal” weight, I move to the next set point and check in again the following Friday, and so on. But if I’ve put on a little weight, I know I need to make a change to stay on track. That’s another major part of goal setting that doesn’t often come up during the process itself — a correction protocol. You need to have a plan to correct yourself if you do get off track. If I’m trying to maintain a specific weight, I know I need to eat better or get more exercise, or both, so I need to plan for that. More on set points and correction protocols in this month’s Level With Me. When it comes to setting the goals, I try to set aside time on an annual basis to determine what I want to accomplish. I may set aside a Saturday when the phones aren’t ringing, the computer is off, and there are no
distractions. It’s a chance to think about what I want to accomplish in the coming weeks, months, or years. In many ways, it’s a meditation ritual. I clear my mind, get plenty of exercise in the morning, and stay hydrated throughout the day. It is just me and my thoughts. For 2018, one of my goals was to read 50 books. I’ll admit it was a challenge. When I set that goal a year ago, I found it difficult to create specific set points. It all came down to finding time to read. I ended up reading a total of 47 books by December 2018. I may not have hit my 50-book goal, but I’m happy with the results. When you read, you learn. Each of those 47 books brought something to the table, Right now, I’m looking ahead to the new year. I’m always working on growing personally and professionally. On the personal side of things, one of my goals is to spend more time with my kids, who are 4 and 6. One way I’m spending more time with them is through teaching and learning. This year, I’ll be helping them develop and I can say I learned something and I am a big believer in the saying “Leaders are readers.”
new skills and understand technology. Because we live in a technology-driven world, not to mention a technology- based future, having an understanding of how new technology works can be incredibly valuable. I’ve been helping build that foundation, teaching them how machines and programming work and how we interact with them. I’ve taught them that machines will only do what we tell them to do. It can be hard for kids to grasp at first, but I created a simple board game with action cards to help them visualize how machines and programming work on a basic level. Of course, as they learn, we get to spend a lot of time bonding and just being together.
No matter what your own goals may be, here’s to a wonderful new year!
-Jeremy Wyatt
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Personal New Year's Resolutions Aren’t the Only Ones That Fail Why Your Business Goals Won’t Work At the end of the year, entrepreneurs sit down to develop their goals for the new year. They craft specific objectives based on best practices they learned from other leaders, implementing S.M.A.R.T. goals or strategic plans to give their company a clear path to success. But every year, perfectly crafted benchmarks fall by the wayside and join weight loss on the scrap heap of New Year’s resolutions. Owners scratch their heads wondering why they didn’t reach their target, not understanding the root cause of their failure. You can have the most carefully planned- out goals, but if you haven’t built a foundation on these three concepts, you’ll never achieve them. Organization Nothing derails a goal faster than ineffective systems and processes. Procedures aren’t dynamic, so as your business changes, an audit of processes isn’t just useful; it’s necessary. But as your business must continue to improve its organization in order to adapt to change, so do your team members. At the root of every system is an employee, so without teaching basic principles of time management and prioritization, those systems are limited in their capacity and effectiveness. Communication Negative external and internal relations are surefire goal- killers. Internally, the success of your company is dependent on the dynamics between team members, management, and leaders. Complacency and gossip tend to spread like wildfire and can cause a dip in productivity. External communication between partners and potential clients is very similar. Without clear expectations and mutual respect in relationships, your business will cease to scale. Customer Service Clients need to feel valued to have a future with your business, and that’s rooted in every interaction. Customer service is a broad term that is often miscategorized. In truth, every role is based on customer service, but many people go wrong about it by taking on the attitude of “It’s not my job.” Lack of ownership and willingness to serve customers in every capacity will undermine any long-term objectives your company may have. The good news is that with proper execution of these three concepts, you can focus on attaining your goals, and in the process, achieve levels of success you previously thought impossible. Don’t let your objectives for the new year fall by the wayside. Achieve those goals by rooting your business in organization, communication, and customer service.
Satisfied With Last Year’s Performance? Are You Sure You Should Be? Calculate Customer Churn — And Learn How to Reduce It in 2019
You’re looking over last year’s numbers, feeling pretty satisfied about the results for 2018. Production increased and you have a lot to feel proud of overall. But what about those customers or subscribers who said goodbye to you in 2018? If you haven’t yet calculated your end-of-year churn, you should feel a little less comfortable. Looking at that churn rate is key to your business’s success. Most business owners say that if they could change one thing about their business, it would be their customer churn rate. Retention is key to success because it almost always costs less to retain a client than it does to attract a new one. Increasing client retention and reducing churn in the coming year can only happen if you know what your churn rate was last year. Calculating Churn It’s not rocket science! One of the most straightforward ways to express yearly churn is to calculate it as a percentage of customers lost: Divide the number of customers you started with in 2018 by the number of customers you lost in 2018. Churn can also be measured by the value of recurring business lost or as a percentage of recurring value lost. Choose the measurement that makes the most sense for your business. Why is this number so important? Think about it this way: Beyond representing how many customers flew the coop in 2018, churn represents an exponential loss of profit. Each year those lost clients don’t do business with you, you lose a year’s worth of potential revenue. By tracking customer churn throughout the year — ideally quarterly — in addition to end-of-year churn, you’ll begin to notice trends that you can address. Does the highest churn always happen in the third quarter? Did you sell more in 2018 but lose more longtime customers in the course of chasing those leads? Noticing how these threads lead back to your losses is the first step in decreasing your churn rate. Of course, it’s impossible to calculate your customer churn if you haven’t been tracking and measuring it throughout the year. If you haven’t, you now have the opportunity to do so for the coming year. Add monitoring these numbers to your resolutions for 2019.
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A New Year in Digital Marketing
Strategies You Need to Try in 2019 Hubspot has some advice on optimizing your website SEO for voice search at Blog.hubspot.com/marketing/how-to- optimize-for-voice-search. Say Hello to Chatbots We didn’t listen when science-fiction movies warned us, and now AI is taking over the world. But maybe that’s not such a bad thing. Programs like chatbots have become more sophisticated and are being hailed as the future of lead generation. Deployed on websites, through Facebook messenger, or even via text message, chatbots can answer common questions and shepherd visitors through your digital funnel. Start learning the basics about chatbots at ChatBotsMagazine.com Technology continues to evolve and is constantly affecting the business world in new ways. As a result, it’s shaping up to be an interesting year in marketing. Keep an eye out for opportunities to incorporate these trends into your marketing strategy.
HAVE A Laugh How are you ranking on voice search? Asking Siri or Alexa to find something online brings up fewer results than searching through a web browser. ComScore estimated that half of all online research will be done through voice search by 2020, which means that if your website isn’t voice-search friendly, half of your audience may never hear about you. Creating a successful marketing campaign requires foresight and adaptability — especially these days. Technology and consumer habits are rapidly changing, and using what worked in 2018 won’t necessarily be the right move in 2019. To help you determine your strategy for the coming year, here are a few rising marketing trends worth your consideration. Market With a Trusted Source eMarketer found that 30 percent of internet users have ad- blocking software installed on their devices, meaning that a big chunk of your audience will never see your online ads. But even users who do see online ads often don’t trust them. A 2015 Nielsen study found that consumers are far more likely to choose a company to do business with based on word of mouth, branded or editorial sites, and reviews. When planning your digital marketing strategy, learn how to incorporate these trusted sources in order to get your brand out there. Optimize for Voice Search
PUZZLE
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Jeremy Wyatt jwyatt@harrisonlawgroup.com www.HarrisonLawGroup.com (410) 832-0000
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Inside This Edition 40 West Chesapeake Avenue, Ste 600 Towson, MD 21204
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Are You a Goal Setter?
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Why Acknowledging Customer Churn Is Key to Success in 2019 Are Your Business Goals Doomed to Fail?
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Marketing Trends to Watch in 2019
Have a Laugh
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Essential Strategies to Court New Hires in 2019
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Level With Me: Goals in Overdrive
How to Draw the Best New Hires in a Record-Breaking Labor Market 3 Strategies for Success Finding good employees has always been hard, but in the economic environment of 2019, it can feel downright impossible. At the end of 2018, U.S. unemployment was the lowest it had been since 1969. For months, unfilled jobs outweighed the number of people seeking employment. In a market where job seekers have the pick of the litter, employers face stiff competition when courting prospects. Here are three strategies to draw in top performers and keep them. 1. Pay more. Excellent benefits, fancy perks, and flexible hours are important items on any job seeker’s checklist, but virtually every prospect’s top priority is adequate pay. Workers today have unprecedented bargaining power, and yet, according to ADP, small businesses with fewer than 50 employees boosted wages only a little over 3 percent last year, an amount quickly swallowed up by inflation and increasingly steep living costs. There’s just no way around it. To attract top-tier talent, competitive compensation is paramount, especially in 2019. 2. Give new hires the chance to grow. The best employees constantly hunger for new growth and development opportunities. Show prospective hires the
potential heights they can reach at your organization. First, your business has to have a growth mindset that promotes loyal employees and empowers them to step into exciting new roles. Then you need to present prospective employees with challenging, rewarding projects and responsibilities and show examples of how those who’ve come before them have succeeded. Annual reviews and raises are a start, but you should also explain how a job at your business will improve your prospect’s skills, career, and life. 3. Get them in the door. If you already offer a competitive salary, an expansive benefits package, and a good work environment with opportunities for growth, the only challenge left is to get on your ideal candidate’s radar. One of the best ways to do this is to implement an employee referral program. Ask your team if they know anyone who’d fit the empty role. If you end up hiring their prospect and they stay on the team for, say, six months, then reward the referrer. Cash, PTO, and other benefits will encourage your loyal employees to bring in their skilled friends.
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January 2019
Level With Me By JeremyWyatt
Set Point and Correction Protocols: Your Business Goals in Overdrive
When it comes to reaching big goals, we are a lot like frogs. You know the story of the frog placed in a pot of lukewarm water, never jumping out as the water gradually heats, and eventually boiling to death. So it seems with many of our goals —we set them at the beginning of a year, then as the stress and heat of business increase throughout the year, those goals tend to die out. It’s happened to you, to me, and to everyone bold enough to set big goals. You put forth the effort to lay out your goal for revenue, personal fitness, or whatever you want to achieve. Then a few weeks or months afterward, something else distracts you, and before you know it, you’ve let that go of that goal completely. The primary problem with “normal goals” is that we have no plan for what to do when we go off track. The solution consists of set points and correction protocols. “You can now let go of the STRESS and MENTAL CLUTTER of worrying about your goal because you have already created a plan for what to do when things go ‘wrong.’” HERE’S HOW TO AVOID THAT.
WHAT ARE THEY?
A set point is a minimum, non-negotiable threshold you establish as a contract with yourself that you will not go beyond. Set points must be achievable and measurable so you can detect when you are not meeting your goal. Once you have a set point, you can monitor it regularly, whether it’s weekly, monthly, or any period that makes sense to you. If — or when — you go beyond your set point, you can enact ... A correction protocol , which is a pre-arranged plan you have agreed with yourself to enact when you have gone beyond your set point. The correction protocol must be both manageable and designed to return you to your set point. Now you have both a detection method for when you are off track for your goals — a set point — and a plan for returning to your goals — a correction protocol.
LET’S LOOK AT HOW THIS MIGHT WORK IN PRACTICE.
For example, if your goal was to reduce the time for collecting receivables from an average of 90 days to an average of 45 days, your plan might look something like this:
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Set point: No account goes more than 45 days out from the date of invoicing without you taking action.
Did an account go over 60 days from invoicing? Send the demand letter.
Correction protocol: For all accounts at least 45 days old, take the following steps:
Did an account go over 90 days from invoicing? File the lien, bond claim, or other lawsuit.
• At 45 days from invoicing, call and email your customer and ask politely for payment, letting them know that your company expects to be paid for its work, and soon. • At 60 days from invoicing, send a polite but firm letter letting your customer know that if payment doesn’t come soon, you will be filing a claim to collect. • At 90 days from invoicing, file a claim, whether it be a mechanic’s lien, bond claim, or “vanilla” lawsuit — and be sure to check your filing deadlines! That’s it! You now have your plan. Here’s the secret and powerful benefit of establishing set points and correction protocols — you can now let go of the stress and mental clutter of worrying about your goal because you have already decided on a plan for what to do when things go “wrong.”
Are you worried that this correction protocol would be too aggressive? Well, the alternative is letting your goal boil like a frog. If you let unpaid money go 60 days, then 90, then 120 out, your lien and bond rights start to disappear and your leverage incrementally declines. Then, after six months or a year — during which you have had to do without the relevant payment — you start thinking, “Well, 75 cents on the dollar wouldn’t be so bad. At least I could cover x or y expense now.”You deserve better! This method of set points and correction protocols works for practically any aspect of your life or business. For example, I set a goal to read 50 books in 2018. My set point was finishing one book per week, and my correction protocol was to read through every day at lunch until I finished the book I was reading. It worked! As of the end of November 2018, I had read 47 books in 2018.
Did an account go over 45 days from invoicing? Make the call.
For your construction business, you must be the judge of goals and set points, but to learn about some key correction protocols for getting paid on construction projects, read my book, “The Subcontractor’s Roadmap to Getting Paid for Extra Work” Get your free copy today by emailing me at jwyatt@harrisonlawgroup.com .
-Jeremy Wyatt
*Credit where credit is due: I first learned about set points and correction protocols from reading Vishin Lakhiani’s book,“The Code of the Extraordinary Mind.”It’s worth a read.
jwyatt@harrisonlawgroup.com
www.HarrisonLawGroup.com
(410) 832-0000
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