Superstars and hotshots aren’t your most valuable employees.   Over the long haul, it’s the reliable workhorses who are your best workers.  Yes, every company needs bright, well-educated people to contribute fresh new ideas and winning innovations.  But these employees often lack the fundamental skills and experience that’s needed to keep a business running smoothly.  Steadiness and reliability may not be flashy, but they’re essential to the health of any successful company.

Studies show that the best way for employees to learn is through collaboration, not competition.  Although high school and college students often learn better because of competition, workers learn better by sharing exercises in training programs.  Retention level in increased for everyone because workers see their fellow employees as helpers not rivals.  The best on-the-job training comes from co-workers rather than managers.


Retirement planning tax tip.  Even if you don’t receive a deduction for your retirement plan contribution, you still obtain a tax savings from a contribution because the income or gain that you realize in your retirement plan is tax deferred.  You also gain the additional benefit of having the retirement plan’s income or gain grow on a tax deferred basis over the period of time the funds remain in the retirement plan.


Most businesses know that high labor turnover is expensive.  Hiring and training employee replacements is costly and time consuming.  Productivity drops because new employees are inefficient until they learn how to do their jobs properly.

However, one cost that employers are often unaware of is increased payroll taxes.  When a new employee is hired, social security and federal and state unemployment taxes are paid on a new wage base ($90,000 FOR 2005), the wage base for federal unemployment taxes is $7,000.

As an example of how these additional payroll taxes can add up.  Assume that you are an employer who pays state unemployment taxes at the usual rate.  At the end of the first six months of the year, you replace a top management employee who earns $180,000 a year.  Despite the fact that you’ve already paid the maximum social security and state unemployment taxes for the original employee, you now have to pay these same taxes for the replacement employee.  The net effect is that you will pay payroll taxes for two employees earning $90,000 for the year rather than the maximum social security and state unemployment tax for the first $90,000 earned by one employee.  Your total payroll taxes will now be a least $13,770 instead of almost half of what you would pay for one employee.

While the additional payroll taxes are not as substantial for lower paid employees, they can still represent a sizable cost increase, particularly if you have a large work force.

In addition, most states determine an employer’s unemployment tax rate by the employer’s labor force turnover record.  High turnover can result in a substantial increase in an employer’s tax rate as well as in worker’s compensation premiums and certain other employee plan payments.

Although the tax cost of high labor turnover often goes unnoticed, it can add up to a substantial sum of money.


Disciplined direct marketing.

 Many businesses are finding that direct marketing offers a productive alternative to other channels of distribution.  Many of the guidelines for direct marketing are the same as those for any other successful sales effort, but there’s one cardinal rule the direct marketer shouldn’t ignore:  Develop one winning product at a time and focus on it.  The best direct marketing doesn’t confuse the prospect with various alternatives.  It spotlights one product and concentrates on its benefit to the customer.

Don’t restrict your direct marketing efforts to gaining new customers.  In fact, the customers who have already bought your product are your best bet for direct marketing.  You can go back to them again and again.  And when you choose the focus for your initial direct marketing effort, you should be thinking about a followup – additional products that will appeal to those who have already responded to your first offer.

In short, it’s OK to promote a group of related products, but sell them one at a time.

Conduct your own focus group.

Market researches know that one of the best ways to get actionable marketing information is through a focus group – a forum in which a professional researcher poses questions to a group of potential buyers, distributors, or consumers.  The questions asked in a focus group are usually different from those asked in a survey, where “yes/no” or multiple-choice answers are the norm.  In focus groups the questions are open-ended.  The person conducting the research doesn’t look for specific responses, but asks for general opinions.

You don’t need a costly formal focus group facility to do this kind of research.  There’s no reason, for instance, why you can’t gather a group of your customers over lunch or late afternoon wine and cheese.  In this informal setting you can invite, for example, suggestions about improvements or get reactions to ideas for new products.  Your customers will probably be flattered that you’ve asked their opinion and you’ll get a perspective on your business that may surprise you.