Cultivating a Business Network

Networking in business is harped on so often. But it is one of those things that can’t be simply attained, it has to be cultivated. I over the past few years have started to build a network that I can lean on, especially during times like now. But what is probably more important, others can lean on me.

Late last week I ran across two resources I thought were great.

The first is an article on Fortune.com in the Ask Annie section called Be a Better Networker. Anne Fisher speaks to a couple of references, namely Ivan Misner from www.bni.com. He wrote a book that bebunks a common misconception – six degrees of separation. What he says is that the finders show 29% of people are separated by six connections. The other 71% are not. That is important because it means many people can get better at networking and that there are few honest to goodness stars out there. Misner, in the article, offers these tidbits for connecting with someone you don’t know very well:

Next time you go to a networking event, including an office party, Misner suggests asking a trusted friend to keep an eye out and report back on how you measure up in these four areas:

Eye contact. Are you making steady eye contact throughout your conversations, or looking behind the person you’re talking with, to see who else is there?

Arm movement. Where are your arms while you’re chatting? Are they folded across your chest (which says, “I’m bored”)? It’s better if they’re tucked behind your back (“I’m interested, I’m listening”). If you’re in the habit of gesturing when you talk, to add emphasis to your words, that’s good too.

Positioning. Are you standing in an open, welcoming way – or blocking people out of your conversation? Are you leaning on something, looking tired or bored? Are you unable to shake hands because you’re juggling a glass and a plate? Tsk, tsk.

Facial expressions. Misner advises keeping conscious control of the look on your face. You don’t have to wear a nonstop grin, but do try to look friendly and interested, even if you’re not.

What you say counts too, of course. Within the first seven seconds of meeting someone new, ask a question like this: “How can I help you or your business?” “Ask her to talk about what she does,” advises Misner. “This others-oriented approach produces a powerful and positive first impression, because people remember you as the person who offered to help them – not just as someone trying to sell them something or get something from them.”

The second resource about networking I liked was from the Wall St Journal. It is called How to Build a Job Network. The premise centers on mentoring and how that can have benefits for both the mentor and mentee. Kathy Kram is interviewed below and she says that two skills are needed for good mentoring. They are the ability to actively listen and have self awareness. Listening is important because it strengthens the bond and how each person can help the other. Self awareness is important because it identifies the strengths of the relationship i.e. sometimes it is better to defer to someone more knowledgeable.

http://s.wsj.net/media/swf/main.swf

And finally, if you don’t believe that networking is worthwhile, check out this link of the Fortune Most Powerful Women Summit.

October 2008 Job Report Analysis and a Look Ahead

The October 2008 Job Report was pretty bad. Not only were the October numbers really poor but the revised September 2008 numbers were revised to 284,000 jobs lost. Between the two months that is a loss of 524,000 jobs. In 2008 alone almost 1% of the job market is gone. 1% doesn’t seem like very much but when you couple it with wages that have been stagnant for several years you get a job market that is very poor and uninspiring to the worker.

But what is causing this job wage malaise and subsequent contraction? I theorize that the losses of the late ’70s, early ’80s and finally early ’90s were the result of the US economy moving from a manufacturing base to a services based economy. This shift required a new skill set to be developed. Many of the skills transfered from blue collar to white collar and the rise of the personal computer. I could probably rationalize another change in the economy from services to intellectual but that sounds a little like splitting hairs. Is it the overarching impact of globalization? I say yes. The US is moving to understand globalization… finally. This shake out will benefit the US business community because the expectations are much more known and opportunities to profit will expose themselves. For instance, right now the focus on globalization is the exporting of jobs and work, but after the current economic situation plays out other nations will import US services at a higher rate again. But the questions are how and why?

The US needs to be good at something again. Over the past 100 years the US has been good at war (still is), manufacturing, infrastructure building, education, IT, agriculture, and finance. Over the last 15 years the rest of the world has overcome a certain undefined threshold and is now very good at many of the items listed. The current US leadership (for two more months) has focused on war as the next innovation driver. And that is too bad.

The next innovation drivers should be energy and healthcare. Both have so many inefficiencies and business opportunities.
The problem with energy is mostly image. The investment it needs aren’t coming in like they should because of a perceived need to overcome economies of scale. And economies of scale are an issue, if your business plan is one of large initial purchases. An incremental business case would be a good one to pursue. Another issue with energy is regulation. Tapping the energy grid or upgrading it is very difficult to do.
Healthcare has an information problem. HIPPA helped create the problem because paranoia crept in. But standardization in healthcare patient records will begin a domino affect in the industry. As soon as the waste of inaccurate, unknown, and not up-to-date data is resolved the resources spent on correcting this issue can be pointed at improvements in testing, care, prevention, and medicines.

Without these two potential job creators the job market will continue to degrade. A few weeks ago I predicted that the US job market would be deep and quick. The deep is starting. I expect it do bottom in February of 2009, level off over the following six months and then start to really improve in the fourth quarter of next year. I even expect this improvement to be pretty dramatic as well. In the mean time, I encourage everyone to round out their skills. Read varied books, take a class, and participate in some local organizations. You never know which connection will get you the next opportunity.

October 2008 Jobs Report and Wages

Here are the job market and compensation numbers for October 2008 (based on the job report):


Net
loss of 240,000 jobs in the month
(revised to a loss of 320,000 in the November ’08 report and revised to a loss of 423,000 in the December ’08 report revised to a final loss of 554,000)

  • Analysts expected a loss of 200,000
  • tenth straight months of job losses
  • 1,200,000 jobs lost in 2008
    • Half of that number is in the last three months
    • 3.3 million workers have been added to the jobless rolls over the last 18 months
  • September was revised to loss of 284,000 jobs (revised again in the November ’08 report to a loss of 403,000 jobs, revised to a final loss of 458,000)
    • Highest since November 2001
  • August revised to a loss of 127,000 jobs
  • Over the last 12 months the number of persons unemployed has risen by 2.8 million and sits at 10.1 million


Unemployment rate rose to 6.5% 

  • Forecasters thought it would rise to 6.3%
  • The unemployment rate hasn’t been this high since 1994
  • Over the last 12 months the rate has increased by 1.7%
  • Underemployment is now at 11.8%
    • This includes part timers who want full time jobs
  • The number of people in the Underemployment category increased by 645,000 people to 6.7 million
    • A third of the 6.7 million joined over the last year (2.3 million)
    • Highest since July 1993
  • The long term unemployed (those without a job for 27 weeks or more) increased by 249,000 and totals 2.3 million people
  • Of those unemployed, the long term unemployed comprises 22.3% of that group – so over a fifth of those unemployed are without a job for more than half a year
  • Another grouping that is unfortunately growing is the marginally attached to the labor force group. These are people not counted in the survey. These are 1.6 million persons who haven’t looked for work in the last four weeks but need a job.


Specific Segment Job numbers:

  • Manufacturing lost 90,000 jobs
    • 27,000 of the 90,000 are due to the aerospace strike and are expected to return to work eventually
    • Without the strike the losses are in line with the last two months
    • The manufacturing and auto industries are in the worst shape in 30 years
  • Construction lost 49,000 jobs
    • Since peaking in 2006, construction has lost 663,000 jobs
    • Infrastructure projects would help with this situation
  • Retailers lost 38,000
    • Consumer spending in the third quarter saw a decrease for the first time in 17 years
  • Professional and Business Services loss 51,000 jobs
    • These losses are increasing in size compared to 2007
  • Government sector added 23,000
    • Largely based in the local governments
  • Education and Health Services grew by 26,000 jobs
    • 348,000 jobs added over the last 12 months
  • Mining added 7,000 jobs
  • Financial Services lost 24,000 jobs
    • Lost 200,000 since peaking in December 2006


Wage:

  • The average weekly paycheck is $611.86
  • The average hour earnings of production and nonsupervisory workers is $18.21
  • The average hourly work week stayed the same – 33.6
  • The average weekly wages for many Americans has increased by 2.9% over the past 12 months
  • September’s annualized inflation was 4.9%
    • Pay is lagging prices and is expected to continue to
  • Wage growth for September and October was much slower than earlier in the year, indicating a deteriorating economy


Notes:

  • The share of adults who are working is 61.8%. This is the lowest number in 15 years
  • The economy is expected to get worse and an unemployment rate of at least 8% is expected in mid 2009
  • 8% unemployment was last seen in the early 80s
  • GDP is expected to be stalled out until early 2010

Bureau of Labor Statistics

Job Report Stats Summary

Glassdoor.com and Jobschmob.com are Fun

I’ve recently stumbled over a couple of new sites that I need to add to my Job Site Resource page. They are Glassdoor.com and jobschmob.com. Both, if anything, are entertaining. But perhaps in the coming contraction of jobs they are worth something more than a few chuckles.

Glassdoor.com
This site offers employees to rate the place of employment. The data entry part is pretty thorough, but not too time consuming. It allows for some free flowing opinions as well, so that is good. There is a salary function that allows you to select your company and input your statistics and then after a couple of days of review you can see yours and others as well. All in all, it is a good site for someone who is curious about a certain company and a certain role in the company. One downside is that is still pretty new so some companies don’t have much in the way of reviews or salaries. One final note, this site is the ultimate “why didn’t I think of that?”

jobschmob.com
This site is a little bit more tongue in cheek than Glassdoor.com. It provides its users an opportunity to vent about their bosses, their coworkers, their company, and so on. It is geared towards humor which is good because the target audience – the miserable – loves company. I guess the site is a little bit like theonion.com but with more real life stories. I recommend this site as an occasionaly diversion or after a bad episode with your boss (someone certainly has it worse).

The Will of the American People

I wish I had something clever to say. I don’t. Yesterday the US, myself included, did something it does every four years and every four years it is significant. But yesterday was different. The election of Barack Obama as the next President proves again to the world that America is different. I’m not saying I live in the most progressive nation. I’m saying that with the wealth and with the military power there is a living conscience.

The world may not like the US Government, but almost everyone admires the will of the people. 

Why Voting Matters

Voting matters because it is the most scrutinized information in the world. That is strictly opinion but I would bet on it. Corporations don’t know as much about as the people that analyze voting records. Because of this scrutiny voting is paramount. Planning how campaigns are run and how candidates communicate are all contingent on who votes. So even if you don’t know who these people are care who wins, it is important to vote because the following election season will have a better understand of who you are and perhaps what matters to you.

Please Vote!

Simple Entrepreneur Rules and an Innovative Golf Offering

There are two entrepreneurial entries I really liked from GigaOm that I accessed from the NY Times. The first is Paul Polak: 15 Rules for Business Success in Any Market by Carleen Hawn and the second is UGC + Golf Tips = MyTourSwing.com by Chris Albrecht.

Paul Polak is a serial entrepreneur. He’s succeeded and he’s failed. He has enough experience to create some fairly simplisitic rules for starting a business. Here they are (pulled from GigaOm):

The 12 Steps to Practical Problem Solving:
1. Go where the action is.

“Spend significant time with your customers. This is how you learn what
they need,” he says. Not hours, days. Polak lived with his farmers for
6 months.
2. Interview at least 100 customers a year.
You
do it. Not an employee. Listen to what they have to say. “Too many
entrepreneurs build the product they want to build — not the one that’s
needed.”
3. Context matters. If your solution isn’t right for
the context, for example, if it costs too much for the customers you’re
trying to serve, you won’t succeed.
4. Think big. Act big.
5. Think like a child.
6. See and do the obvious. Others won’t, which is opportunity for you.
7. Leverage precedents. If somebody has already invented it, don’t do it again.
8. Scale. Your business must have potential to scale. Remember, your market must include at least 1 million customers.
9. Design to specific cost and price targets. Not the
other way around. (Celeste: it means — Do not price to your design,
design to the price you need to hit to make your product appropriate to
your customer.).
10. Follow practical three-year plans. Two years is too short. Ten is too long.
11. Visit your customers again. And again. “Any
successful business in this country is based on talking to your
customers all the time. A good CEO spends half his time ‘in the field.’”
12. Stay positive. Don’t be distracted by what other people think.

You can read more about these rules in Polak’s book, “Out of Poverty: What Works When Traditional Approaches Fail.”

Next is the MyTourSwing.com piece. I really like the innovated way to do golf lessons. Basically, you video yourself and post to a website. Others can comment on what you are doing wrong and you can pay to get professional teachers to send you direct criticisms and advice. Most of the time an entrepreneur doesn’t need to create something never offered before, all they have to do is offer something that could be possibly mundane a new way. The golfer community is always looking for easy ways to improve. Sometimes it is special brush tees. Sometimes it is alignment training aides. Sometimes it is a special golf balls. And sometimes it is a website. There are millions of golfers looking for a easy fix. Curiosity will get the ball rolling.

Heating Oil Prices Receding Just in Time

A theme of mine is energy innovation and heating oil is a very direct barometer of the situation. City Room blog on NYTimes.com The other day ran a piece that lines up well with my pet project of following heating costs. The piece is called A Happier Ending for One Oil Heat Customer and it talks about the need for heating oil companies to be compassionate to those that locked in heating oil prices when they were at their apex. A company named Petro was called out specifically for its good customer service. Here is an excerpt from Jim DiLeo, president and co-owner, Beato Fuel:

“If you want to keep an account, you need to have good will,” Mr. DiLeo
said. “The only way you keep customers is to remain flexible.”

Competition in the space is improving and one avenue is a website called Heatingoil4less.com. This site aggregates suppliers and their offered prices. Customers can order through the site and pay a type of processing fee ($6.99).
Another website worth noting is one supplied by a reader called http://www.utilitybillassistance.com. It is a type of dashboard site listing ways to save on heating costs this winter.

I started writing about the cost of heating oil over the summer when prices were high. I expected a government intervention in the prices but the sour economy stepped in instead. Here are links to my prior writings and a few others:

Will Heating Bills Kill the US Economic Rally? (9/2/08)
Another Writer Sounding the Heating Oil Alarm (8/16/08)
Update on Heating Oil and China Growth (8/6/08)
The Fuel Cost Balance (8/4/08)
Oil Attention Too (5/27/08)
Oil Attention (5/14/08)

Two Entrepreneur Resources

I live in North Carolina and we have early voting. Yesterday, for the sake of democracy, I waited in line for two hours and cast my ballet. During my wait I accessed my blackberry internet and read some good posts from the NY Times in the Small Business section. Two articles I really liked were How to Avoid Becoming a Failure Statistic by Paul Brown and Inspiration Can Be Found in Many Places, but You Need to Be Looking by Mickey Meece. Here is what I liked about each:

How to Avoid Becoming a Failure Statistic
This is a no nonsense quick read that cuts through the BS of oversimplified cliches like “Just think success and you’ll be successful.” This read should be a wake up call for anyone who thinks they have everything figured out, because there is a good chance you don’t. And finally, the best thing about it is the very first segment – sometimes your business fails not because of luck or timing, but because of you, the owner. It is hard to look in the mirror sometimes.

Inspiration Can Be Found in Many Places, but You Need to Be Looking
Kris Kimel created something called the Idea Festival. It is an event specifically for inventors and entrepreneurs.

Carving out time to find inspiration may seem unrealistic to a
small-business owner working 90 hours a week. But Mr. Kimel said it
must be done to find and keep a competitive edge.

“You cannot
afford to say, ‘I don’t have the time to get out of my little circle
here to understand what’s going on,’ ” Mr. Kimel said. “You can’t make
the mistake of thinking the only place you’ll learn is from colleagues
who are doing exactly what you’re doing.”