Evaluating Remote Employees: Online Performance Reviews

Evaluating Remote Employees
What is the best way to evaluate remote employees?

As the year-end approaches many companies are preparing for performance reviews. Due to the Covid-19 pandemic, workplace dynamics have been dramatically changed over the past few months. The word office has a whole new meaning now, from heavily reduced personal interaction and connection to a heavy reliance on collaboration tools and communication technology. With the absence of in-person interactions – How can you fairly and accurately deliver clear feedback and maintain trust with employees? Here are some ways to help you prepare…

It is important that you construct an employee review strategy and share it with your team. This shows consistency and improves the nature of performance review discussions.

Create and Utilize an Employee Review Template

Performance review season requires preparation from both the reviewer and the reviewee. It is a huge mistake if you think you can just hop into a review and just sort of “wing-it”.

The first step in the preparation process is to create and utilize an employee review template. This is a proven and effective way to document and track employee performance. You will also find that this assists you in conducting a more focused review and creates a level playing field for all involved.

If possible, include your review template with employees during their onboarding process. This is a way to let them know how and when they will be evaluated and what is to be expected during the process. 

Encourage Self-assessment

Encouraging employees to reflect on their goals, responsibilities, strengths, weaknesses, and overall performance through a self assessment will help you for two reasons.

  1. This ensures that employees set aside time to evaluate their performance
  2. This will help managers get a sense of understanding on whether an employee has an accurate understanding of their impact within the workplace

Encouraging employees to evaluate their performance ahead of a performance review meeting keeps them engaged in the process while allowing managers to get an insight into their employees perspective. 

Utilize a self-performance review template that requires the employee to write their job description, goals achieved within a specific time period, areas of strengths and areas for improvement. This will assist the interviewer in assessing their impact on the organization and allows perspective on the employees side of the story.

Use Video Conferencing

Conducting performance reviews can be a tricky matter during normal times. The remote working environment that was quickly forced on businesses due to the Covid-19 pandemic certainly have not helped the situation.

Conducting an online performance review utilizing video conferencing software will help you create a more personal experience and allows both parties to facilitate transparent communication. It may not allow you to fully read body language and facial expressions the way that you could in person, but it still allows a strong connection between both parties.

Before you begin utilizing your chosen video conferencing platform, establish video conferencing guidelines and distribute them to your team to ensure it is an effective virtual meeting.

Administer Clear and Explicit Feedback

Stay away from making vague and obscure comments as they only end up damaging employee motivation and more importantly, morale. Conducting a performance review in-person or online, managers are expected to be specific with their performance review feedback.

Due to the absence of personal contact, this is more important than ever in a remote environment. As Harvard Business Review rightly states: You have to be much more explicit and verbal. Be cautious while communicating with your employees and delivering feedback – leave zero openings for miscommunication. Be an active listener and spend time to make sure things are not lost in translation. As an example, if a sales team member is struggling to fill their sales pipeline, use performance-based data examples, look to sales department KPI’s (total revenue generated, new leads, average cost per lead, etc.) and offer specific feedback so that the employee gets a clear understanding of where and how they can improve. Utilize the screen share option and walk through specific documents together allowing for clearer feedback.

Another way to offer detailed feedback is by conducting a SWOT (Strengths, Weaknesses, Opportunities, Treats) analysis. This is a proven method that appreciates the positive aspects and identifies areas for improvement.

Two-way Dialogue

Do not bombard your employees with feedback, and consider your job complete. To have an effective performance review, a two-way conversation is required. It’s important to use this opportunity to receive feedback on your management skills and use this time to address any concerns that your employees might have. Once you are complete in discussing all relevant points, set aside time to actively listen to your employee and understand how you can empower them to perform better.

Approaching performance reviews like a dialogue has proven to contribute to a healthy, transparent and productive working environment, both in-person and remote.

Conducting Frequent Reviews

Moving forward if you don’t already, don’t wait until the end of the year for online performance reviews to provide input. Feedback is much more effective when you have frequent check-ins, according the SHRM. Many companies are moving towards providing continuous, real-time feedback consistently throughout the year. When working remotely, conducting frequent 1 on 1 performance reviews allows you to build relationships, establish trust, and open channels of communication. This will allow employees to get timely feedback, increase motivation, and improve on the go, which translates to helping you get more done as a team and building a company culture that retains employees.

Approach online performance reviews with care

If you are looking at improving your performance review process with coaching or with documentation click here or call us at (714) 872-2393. We will run you through mock performance reviews, conduct document review, or provide you with the necessary documents to have successful performance reviews, guaranteed to leave a lasting impression on your business.

Simple Ways To Save On Business Expenses

The costs associated with running a business seems to increase annually. As we are rapidly approaching 2021, without fail you will see everything getting more and more expensive. Rent, employee costs, travel expenses, all of it will likely increase.

We have put together five simple ways in which you may be able to save a few dollars and keep your business in the black.

Go Paperless

There are many benefits to going paperless and they will all save you a lot of time and money. Invest in software that allows everyone to e-sign documents, this can be utilized with suppliers, customers, and internally between departments. Avoid printing out handouts that employees are likely not reading anyways, especially the ones that you already sent via email. I have seen employees walk into a meeting with a printed agenda from their email, only to receive another copy by the presenter. Big fat waste of time and money!

Utilities – Shop Around For Deals

For those of you that know me well, you know that I struggle with the major utility brands out there. These days these utility providers completely take advantage of the fact that many of their existing customers will automatically renew contracts with them and they show zero brand loyalty. Fortunately, if you are willing to put in a little bit of work to find the best utility provider for your business, you can gain massive rewards. In a large amount of cases, new customers often get the best deals, with promotional packages, free additional services, etc. It is definitely worth shopping around to see what is best for your business.

Travel Smart

With the Covid-19 pandemic ongoing, travel for business is going to be significantly reduced giving way to virtual conferences, meetings, etc. However, when travel is safe there are a few tips to save some money. Book in advance, we all know the further you can book in advance, the better deal you get. Credit cards are a great way to save some money, on certain cards (I am a loyal AMEX guy) you can collect point on your purchases and these can be converted to pay for your next flight. If you do not have a credit card that allows this type of activity, I highly suggest spending a few minutes researching an appropriate card that suits you, and in some cases you get bonus points for switching over and transferring your balance.

Office Space

Shared office spaces can work on both a small and large scale. Smaller businesses may be able to save significant money by sharing an office with other small business. Large organizations may be able to save by sharing a floor of a large building with another organization. There are also some businesses that may like to utilize co-working spaces such as with a Regus or WeWork office. These spaces are generally relaxed, allowing flexibility to move around to another part of the city, or region if your business for whatever reason needs to shift.

Another creative way to save some money with your office space is to generate some money. I have a client that has a very high tech and very beautifully decorated conference room that can seat 50, yes 50! They will rent the space out to organizations, even in some cases providing coffee and pastries, or even lunches. It is a great and simple way to generate some income to offset the cost of their office space.

Buy Pre-Owned

This can not only save you a good chunk of change but it can also be a way to add some character to an otherwise typical office type environment. As an example, invest in some pre-owned, pre-loved office furniture. Focus on the fit, form and function making sure that it works with your needs and you can save quite a bit on your decorating budget.

For other ways your business can save on expenses, contact us at MCDA CCG and let us help you prepare your 2021 budget and identify key areas for savings.

Preparing to Sell Your Business: Tips to Help You Prepare

Selling your business can be both stressful and exciting. By simply following established best practices, the good news is that you will have a great chance of selling your business to the right buyer for the right price. We have provided some useful tips below for you to follow when you are getting ready to sell your business.

WORTH OF YOUR BUSINESS

Knowing the worth of your business is like any other valuable asset that you may have like a house, or a car. It is crucial to have a rough idea of how much your company is worth before you put it on the market. Research “comps” or comparable sales for your business, focused on the same size and industry.

If you are unsure on performing a business valuation yourself, reach out to a qualified third party, such as a consulting firm, or an investment bank. Obtaining a solid and reliable valuation will give you a good idea on the ballpark number you can obtain for the sale and provide you with a baseline for evaluating offers from potential buyers.

KNOW YOUR MARKET POSITION

Obtaining a valuation is a crucial first step, but it is not a guarantee that you will actually received the quoted amount in reality. The reality is that there are many factors that will affect the final selling price. The macroeconomic business climate, recent deals within your industry, activities and valuations of your competitors, and many other factors. Before moving on to the next stage, it is important to ensure that now is a good time to be selling your business. You may find that you are better off waiting until prospects improve, unless you have a compelling reason to sell in the short term.

ASSEMBLE A GOOD TEAM

If you have decided that now is the right time for you to sell, great! The next step is to assemble a good team of third-party consultants that consist of the following:

  • Legal Team – They should specialize in mergers and acquisitions. I highly suggest that you find a team that has done multiple deals and who will not shy away from tough negotiations.
  • Accountants/Financial Advisors – They should specialize and advise you on your personal and corporate tax situation.
  • Business Brokers/Investment Bankers – They will serve as an intermediary throughout the entire selling process.
ENHANCE THE BUSINESS VALUE

As you prepare for the sale of your business it is tempting to slow down and relax, however this is exactly what you should not be doing. If you allow your business performance to dip before the transaction is completed and documents are signed, this will allow prospective buyers all the excuse they need to lowball you with their offer.

You should be working on enhancing the value of your business before putting it on the market. Examples might include, increasing sales, increasing your profits, lowering expenses, streamlining manufacturing processes or workflows, and expanding your customer base. Again, if you have a compelling reason to sell quickly, all of these things may not be possible but accomplish the ones you can with the resources available to you.

IDENTIFY TARGET BUYERS

You will find that selling your business is likely to be much more successful if you know who your target buyers are. The two types of M&A buyers are generally: Strategic and Financial.

Strategic Buyers – They seek out purchases that will fit into their own long-term business strategies. As an example, a strategic buyer may be looking to expand vertically, possibly to different parts of the supply chain or they may look horizontally meaning new products or industries. You will find that strategic buyers are likely willing to pay more for the business, since they can immediately take advantage of economies of scale.

Financial Buyers – They are treating the purchase as an investment, looking at potential returns they can achieve. Once they have achieved their targeted return on investment, they will most likely look to take it public with an IPO, or look to sell the company themselves. It is typical for financial buyers to use debt to finance the purchase, and they are most interested in seeing a history of solid growth and strong financial statements.

When you’re ready to start preparing for an upcoming sale or another business transaction, click here to connect with a consultant today. At MCDA CCG, we can partner with you to help you achieve your exit goals.

Uncovering Hidden Talent in Your Organization

Uncovering Talent

Executives generally have a few key attributes they look for in the next generation of leaders that display a promise of outstanding things to come. Executives then become huge advocates for the individuals that are demonstrating these aspects; they write gleaming performance reviews and do what they can to ensure these stars are in the limelight when promotion decisions are made. These prized attributes usually represent a subset of the competencies identified in their organizations talent models and will constitute a trusted shortcut for busy seasoned executives.

However, there is an aggregate cost for these seemingly obvious choices, as they tend to grant unearned halos on some and cast shadows on others. This will cause organizations to disregard critical flaws in their targeted talent and they will overlook the capabilities of others who are hidden in plain view.

The halo effect created on the targeted talent allows their advocates to assume they possess additional skills and competencies (which in a lot of cases is not true) without actually vetting or recognizing the assumptions. Rapid promotion of these individuals without sufficient due diligence causes organizations to miss the opportunity to correct areas of concerns early in the process while the employees are still workable to change. In some cases decision makers will realize that the individual cannot flex, which is even more troubling. Rapid promotions can unfortunately reinforce behaviors that will not sustain success at higher levels. Capability gaps eventually emerge in these “super stars” that can cause them to stall or completely derail.

Now, looking at the other side of the equation, individuals who do not demonstrate the prized behaviors to the same extent do not benefit from the advocates and may be pushed into the shadows; they are assumed to be missing fundamental skills (again without proper vetting). There is not ample focus and energy in the talent discussion to bring to light their actual capabilities or contributions to recognize that the are ready for the next level of challenges. Thus becoming hidden talent, passed over for positions for which they are more qualified and stalling their careers often forcing them to eventually seek out organizations without such blinders.

As an example, some leaders reward an individual who stands out and takes charge. Those individuals that tend to gravitate to the spotlight, can manage up, and ensure acknowledgement for their achievements are more likely to be noticed. What is generally less clear is how these same individuals influence peers or how much scorched earth damage they created to realize those achievements. At the same time, an unintentional shadow may be cast on those who quietly create alignment and create momentum across the entire organization as they may also more readily share the credit and do not focus on being in the limelight. It is also not an accident that they are consistently on the teams that make a difference for the organization, it can be a TIGER team or something similar. The evidence is clearly there, but you must be able to see it.

Things to do:

  • Know which attributes are the shiny objects that may cause you to take shortcuts in your view of talent. For example, beware the assumption that those who are good at managing up are also adept at creating followership; likewise, notice who is creating followership and results without much fanfare.
  • Watch out for buzzwords or adjectives that either push someone into the shadows or create halos. There are substantial diversity implications as the short-cut models may not be valid against a more heterogeneous group.
  • Ensure that talent discussions are based on data. Leverage development assessments to ensure a well-rounded view of the individual that does not rely on assumptions. It is remarkable how much data an organization has regarding its talent that is not included when key decisions are actually made.
  • Identify critical roles in the organization that provide core experiences for developing the talent pipeline and ensure that the scan for internal candidates is broad and the decision process is objective and disciplined. These roles create important paths for developing the future leadership pipeline and should not be clogged by the result of a limited view of organizational resources.
  • If necessary, bring in an external party who will question assumptions and ensure a robust discussion.

It is very natural for executives to leverage their own experiences in identifying and cultivating talent. In doing so, will tend to veer toward quickly creating a type of focus. At the same time, as stretching is critical to any physical activity, an organization must stretch its ability to identify, vet out, and grow a wide range of individuals to ensure the overall growth of the talent pipeline and the ongoing success of the next generation of senior executives.

To find out how MCDA CCG, Inc., can help your organization plan for critical leadership transitions, contact us here today

Dodging the Financial Death Spiral

Spiral of Death
Death Spiral

You will often hear people in finance talk about the death spiral. Generally speaking, this typically would involve a loan from investors to a company, and the investors would receive a type of convertible debt in return for making the loan. This type of debt would give the loaning investors the option of exchanging that debt (converting it) to stock shares for far less than the existing share price. The company would get a cash infusion, but end up giving away a lot of value and power to receive it.

The idea of a death spiral has progressively expanded, but it simply entails a path toward inevitable destruction if not addressed in a timely manner. It would be safe to say that most finance experts would caution against a death spiral, and here are some thoughts on that wise advice if you are still debating going for it anyway.

Don’t Let Easy Money Seduce You

Many companies have been strapped for cash at some point during their existence, especially early on, and they have been forced to borrow funds on less than optimal terms. The whole death spiral problem essentially started with the need for immediate cash and subsequent willingness to receive it all all costs. However, these days it does not seem necessary, nor wise, for young companies to take on this value plunging ploy. If it is easy to obtain the money, then there is most likely a catch. Venture Capital funding is active right now and with that, there just doesn’t seem to be a scenario where it is necessary to take that path.

Don’t Drown in Debt

There is a lot to be said for a company that can manage to bootstrap its business. This will force the leadership team to attentively consider all expenses and decisions, and it really has the ability to set up a company for financial success in the future. Many of those out there that were able to bootstrap will attest to its many advantages. Although it may seem that a cash infusion is an absolute necessity, taking on debt is a serious responsibility that can have lingering effects. Taking on debt really should be considered more of a last resort rather than an initial funding measure.

Over-Acquiring

The path to cash in some cases may seem faster by acquiring similar but smaller endeavors. These acquisitions may possibly increase production capabilities and capital access, along with bringing other benefits since it’s basically an instant expansion. However, companies become so fascinated with acquiring that they end up needing to finance the process, and eventually become entangled in complicated unfavorable financing anyway. This longer and slower spiral may be an indirect approach, but the outcome will yet be the same.

Merging Beyond Recognition

Companies may explore merging with a firm, ideally on somewhat balanced ground, rather than merely acquiring another business. This will obviously bring a multitude of financial benefits, but it can in some cases happen at the expense of the business’s very purpose. Some see this as a type of hidden death spiral because one of the merging companies may be twisted into something unrecognizable, which seems an awful lot like the very result that was meant to be avoided.

Starting a business is exciting and dare we say fun, but funding operations is a completely different animal. Figuring out which money to take and on what terms is a major decision that cannot be taken lightly, regardless of a company’s financial potential.

Are you looking for a cash infusion that is right for your business? Contact us at MCDA CCG, Inc. and learn how we can assist you in avoiding a death spiral. Our comprehensive approach will provide you with all of the knowledge to make the best educated decision for you and your business.

Potential Snags With Mergers & Acquisitions

Merger And Acquisitions M&A

I have always been a fan of considering mergers & acquisitions (M&A) as a workable way to quickly scale your business.  However, this road is not foolproof by any means.  Let’s go over some of things that can go wrong, so do your research, consult a professional and plan accordingly.

WRONG TEAM

The skillsets your team must possess to grow a larger business through M&A activity is much different than the skillsets your team needs to grow a small stand-alone business. You want to ensure that you have someone inside “Newco” has past experience dealing with M&A related issues such as merging businesses, teams, financials, etc. and someone who knows how to operate a much larger company, typically with increased procedures and many more controls for scalability. Keep in mind, the CEO’s role must evolve as the company scales.

TEAM & CULTURE MERGE

You can relate a merger to a marriage. You are merging people, personalities, and company cultures. And, marriages do not always go as planned, in a lot of cases ending in divorce. But, “divorce” in the M&A scenario is typically harder to transact, meaning you are stuck with these issues, whether you like it or not. It is vital that you take the time to do your homework and make sure that the senior management team has clear roles and responsibilities allowing them the best opportunity to mesh as a new team. By creating a meshed senior management team, the employees on the remainder of your team will aspire to share a collaborative healthy culture of “we” instead of a toxic culture of “us” vs. “them”.

POOR OR INCOMPLETE DUE DILIGENCE

I am positive that you tried to ask all of the right questions during the due diligence process. (I have a great guide that I can provide you as a starting point). I guarantee, even the best advisors and/or lawyers miss things that can come back to bite you. Not to mention, let’s be real here, a seller is trying to sell! Meaning, they are going to present you with things from a rose colored glasses perspective. It is important that you utilize your M&A agreement to protect you with things such as proper seller representations and warranties.

BIG COMPANY LETDOWN

I have seen a lot of entrepreneurs think that selling to and working for a large company will solve all of their problems, they assume because large companies have large budgets, etc. Having been through multiple sales to large companies, large companies bring just as many if not more headaches, as they do solutions. Large companies tend to move at a snails pace compared to the light speed movement of startups, and add many layers of bureaucracy and decision makers. In a large number of cases I have seen that the powers to be at the top of the large companies are focused on the “Big Fish” which means that your startup can get lost inside a large company. You must have a well documented agreement with detailed and guaranteed support ahead of time.

PROPER FINANCIAL TARGETS

In this scenario let’s say that you have two $10MM businesses merging together. It is reasonable to estimate that they combined revenue the combined business could do would be $20MM if not more from cross-selling of products, etc. The reality is that it is likely your revenues will be around the $17-18MM range. Why? Well, it is likely that key employees may not be content with the merger and choose to leave the business, or the more likely scenario that the revenue target was overly optimistic, etc. It is important to build in a safety cushion for situations such as these, and make sure the pro forma economics make sense and work for you.

EARNOUTS

“Earnouts” are payments made to selling shareholders at some point down the road, well after closing the deal, after the selling company hits some agreed upon financial or performance target.  Earnouts can work great if you are a buyer, as most buyers know, earnouts very rarely pay out to sellers as much as the sellers hope for.  Sellers agree to terms thinking the earnout will be achieved, and then a cruel reality sets in when it does not.  So, if you are a seller, regardless how well written you think your earnout is, things are likely not going to pay out as you desire. Take more upfront cash in hand, where you can and be happy with the deal even if a zero earnout is achieved.

LEGAL PROTECTION

Properly documenting M&A transactions for maximum protections in the event something goes wrong down the road is no easy task. It requires the skills of detailed and very experienced legal council. I cannot express enough the importance of utilizing council that has deep M&A experience who has lived and breathed “tough negotiations”. This is one area that I would not be cheap in, pony up for the best M&A lawyer you can afford, it can end up saving you millions in capital and a lifetime of heartache down the road.

This is not intended to be a catch-all list of potential pitfalls, but is simply some high level things to keep in mind to protect yourself when going down the M&A road.  At MCDA CCG, Inc. we have experienced, battle proven M&A advisors and legal resources to help you make your transaction a 100% success. Contact us today and let’s discuss your M&A activity and let us save you time, money and potential heartache.

IT IS TIME TO LOOK FOR A NEW JOB? SIGNS THAT ITS TIME

The days of working 35-40+ years for the same employer and retiring with a nice pension after years of work and loyalty seem to have been replaced with a new normal – changing jobs every few years pursuing knowledge, challenge and career satisfaction. How many people do you know that have started and ended their career at the same company?

According to the Bureau of Labor Statistics the median tenure for US wage and salary workers is only 4.2 years. While data shows that numbers vary depending on age, industry, and location, chances are that nearly everyone will change jobs at least a few times during their career.

Assuming that you have avoided a layoff or company closure, how should you know when it is time to make a switch? The cutthroat job market competition due to the Covid-19 pandemic is a fierce battleground right now and employees may be reluctant to leave the familiar for the unknown. We know that leaving an old job for a new job always involves a bit of risk and uncertainty, there are some factors that make it worth the risk. Let’s explore some areas that warrant taking a leap of faith in your career.

Overworked.

As a company grows, the number or tasks that need to be completed generally grows in order to keep operations running smoothly. In a large number of cases, employers don’t grow their staff as quickly as new tasks start building up, and the tasks fall on the plates of the current staff. When this occurs, employees often find themselves taking on more and more duties outside of their general job description, frustrating, overwhelming or disengaging them. Employees should expect that some added job duties are expected in any role. However, if months and months or even years go by and the responsibilities continue to increase, the employer’s unwillingness to increase headcount and assign manageable workloads may trigger a job search.

No Increase in Pay

As your workload increases and you show continued value to your employer, your salary should increase accordingly. The inflation rate in the US generally fluctuates between 1.9 and 2.1 percent annually. Employees that do not see at least that increase in their paychecks each year, actually are making less than they did in previous years. Most employers are going to expect to see that employees can handle their job responsibilities and make a positive impact on the organization before providing raises. However, if you receive positive feedback on your performance, but your salary is not keeping pace with your responsibilities or the cost of living, a job change may be in order.

Lack of Feeling Challenged

The negative stigma around job hopping isn’t the same as it once was, because majority of employers now prioritize a progressive record of responsibility and challenge over multiple years of tenure with the same employer. If you notice that you are not being challenged regularly in your current job, it is up to you to seek out a role that will push you to accomplish new skills, new goals and exceed expectations on a regular basis rather than the performing the mundane tasks every day.

Lack of Appreciation

A recent survey revealed that 66% of employees said they would likely leave a job if they felt unappreciated, while 76% of millennials said the same. There are a number of different motivations that drive employees throughout their careers. Employees seek challenge, some seek money, and more popular recently is great work/life balance, but everyone wants to feel appreciation for the work they perform. Employers that fail to recognize workers for a job well done will have poor employee retention as employees continue to transition to companies that foster a culture of appreciation.

Lack of Job Satisfaction

Are you ready for some scary figures? Well, the average employee spends 13.2 months of their lives at work, or around a quarter of their time during their working years. That combined with the fact that 80% of employees are dissatisfied with their jobs is just scary. Do you really want to spend 13.2+ years of your life doing something that you feel is unsatisfying? No thank you, it is time to take action. Step 1 – Determine the source of your dissatisfaction. Is it management, job duties/responsibilities, your industry, or a lack of work/life balance? Regardless of your answer, it can be changed, though some may take longer than others. You may find that finding a new manager that better fits your needs is pretty simple, but changing industries may be more difficult and be a bit longer to accomplish. Life is short! Don’t spend years in an unfulfilling job.

Toxic Work Environment

One of the most urgent reasons to change jobs is working in a toxic work environment. It is unfortunate, but there are companies and managers that employ harsh language, abusive behaviors or threats as a means of motivation. This may help them achieve short-term results, but it will inevitably lead to high turnover, disengaged employees, indifference or apathy to work quality, and foster a culture so stressful that it may cause a number of health issues. Majority of employees who have the misfortune of working in a toxic environment state that any sacrifice is worth escaping.

Very few employees can claim that their job is perfect. As in anything there is always room for improvement both as an employer or as an employee. Most organizations are not subject to an employee evaluation like employees are to a performance review. If an employee is given an opportunity to provide feedback to a manager or company leaders, issues may take time to be resolved. As shorter job tenures have become more widely accepted, employees are finding few reasons to wait months or years for their situation to improve. Instead, employees are seeking more favorable opportunities in order to advance their career. Employers must now offer much more than just a paycheck to attract and retain top talent in their fields.

Does your company have a high turnover rate? Do your employees look happy? Contact us today to find out how MCDA CCG can help you transform your organization and help you retain your top performers.

Are you an individual that feels they need to make a change? Contact our recruiting specialist and let us assist you in finding an employer that better suits your needs!

Difficult Workplace Conversations Leaders and HR Professionals Don’t Want to Have

Having difficult conversations with employees ranks high on the list of things leaders and HR Professionals don’t want to do. If you are a new leader or HR Professional these topics are likely to find their way to you at some point.

5 Candid Conversations Leaders & HR Professionals Don’t Want to Have
  • BAD HYGIENE:  B.O. (aka Body Odor) or even bad breath.  Having a candid conversation with someone that involves poor hygiene ranks as one of the most difficult type of conversations to have. Keep in mind that there are legal aspects that you need to consider before you have the conversation.  In some cases an underlying medical condition could be the culprit and you need to address it with the employee. As a leader I have had to have the “B.O.” discussion with an employee and it was uncomfortable but it was ultimately resolved. Remember when faced with a similar situation be candid, be supportive, be considerate, be understanding, and be sensitive.
  • TERMINATION: There comes a time in almost every manager’s career when you will be in a situation where you must perform a termination. A termination should not ever be a surprise to the employee if you are providing them with consistent feedback detailing the consequences if the situation is not rectified. As a manager I would encourage you to speak with your HR Department before initiating the termination process. As a HR Professional, it is your job to ensure that you guide the process and ensure that all of the ducks are in a row. It can nerve-racking if this is your first termination as a manager. It can be beneficial to role play the termination with a team member from your HR Department. You can ensure that you hit the critical points and that you do not expose yourself to any legal issues. During the termination meeting be professional, and empathize with their situation.
  • LAYOFF ANNOUNCEMENT: Layoff announcements are important to relay in a timely manner. It is best to take ownership of the announcement, refrain from stating that it is someone else’s decision. As a representative of the organization, it is your job to accept the role as the messenger. It is best to deliver the message face to face rather than over the phone, but the situation does happen. Refrain from using email, it should be a last resort. It is very important to follow up all conversations with a formal letter or memo to ensure that the communication was clear and understood by your employee(s).
  • LIFE or DEATH:  Sharing good news can be a great perk of your management or HR role but it is extremely difficult to deliver bad news. I recall a time at a past employer where I as the facility manager were called urgently to the front desk. As I arrived a nice woman was standing there and after confirming who I was proceeded to tell me that her husband ( A new manager with our company) lost his life the night before. It was an extremely difficult situation for everyone involved. Dealing with difficult news in the workplace is a challenging aspect to being a manager. If the death is an employee, it is often going to be the responsibility of the HR Manager or Facility Manager to communicate the death to all staff members. In some cases, I would advise you to reach out to outside consultants who can assist with additional counseling and support needed to get through the crisis. This is especially true if HR is among those deeply impacted by the loss.
  • WORKPLACE INVESTIGATIONS:  As if being a leader wasn’t difficult enough, now there is an investigation into an employee’s alleged behavior. Depending on the nature of the complaint, this one could quickly require outside consultants and certainly your legal team.  Dealing with investigations, whether it is fraud or embezzlement claims or allegations of improper relations, it is important to document all conversations and request legal counsel for your protection and your company’s. 
Being a Manager is a Rewarding & Hard Job

Having difficult conversations is a part of the Manager and HR’s job.  Dealing with the unexpected is especially tough.  But, anxiety can weigh heavy when rehearsing for planned conversations such as with body odor or a termination.  Reviewing best practices before situations arise can help the HR Manager navigate these challenges and emerge a stronger leader.

Do you have a tough situation that you need to deal with? Contact us at MCDA CCG and we will pair you with one of our seasoned HR Professionals to help you navigate this situation. We can perform terminations, have a difficult conversation with somebody on your staff, or deliver difficult news. Let’s work together!

The Value of Inventory Management for Small Businesses

Small businesses prosper on the relationships they build with customers and product suppliers. Unfortunately, at any moment, these relationships can be strained due to the lack of proper inventory management. Managing your inventory on a regular basis will help prevent a shortage or surplus of your company’s products allowing you to thrive in areas such as customer service, financial management, theft control, and supply and demand. We will explore the importance of inventory management for small businesses below.

Why is Inventory Management Important?

Too much or not enough inventory affects your business and revenue. When product is out of stock, you let customers down. If you overstock your warehouse with slow-moving items, your profit margin will suffer. In addition, effective inventory management affects warehouse costs and your ability to fulfill orders on time and accurately. Unfortunately, inventory management is one of those business processes that is hard to do by hand. It takes, time, and mistakes could have a negative impact on your business for months and in some cases, years. To avoid the above scenarios, there are basic inventory management principles that can help your small business find the right balance of inventory in your warehouse.

FIFO Approach(First In, First Out)

Inventory management for any type of business greatly improves when you apply the FIFO (First In, First Out) approach. Add the newer inventory to the back of your warehouse system so that older products remain at the front. This allows you to sell your product in the same chronological order as they were purchased or manufactured. If your business utilizes and operates with perishable goods, you won’t experience an increase in unnoticed products that expire again lowering your profit margin.

Customer Service

Inventory management is a crucial component to great customer service because it prevents mistakes such as allowing customers to order products that are no longer in stock. Thorough inventory management systems assist you in tracking production and backorders. As a result, you can accurately tell interested customers when the product will accurately be in stock. Backorders, or orders placed while a product is unavailable for shipment, are also useful to track demand, allowing you to improve the availability of your high-demand products.

Theft Prevention

For those operating primarily on the web this may not always be an issue, but theft prevention or control is important when you start hiring employees or operate a brick-and-mortar storefront. Inventory management allows you to see the number of products you have at any given time and the associated revenue from sales. Additionally, it will be relatively simple to notice when something goes missing.

Quality Control Maintenance

Regardless of your industry or specialty, it is vital to ensure that all of your products look great and function well. Quality control is as simple as having employees do a quick visual examination during stock audits that include checking for signs of damage and proper product labeling. In doing so, you will know which products are sellable and which products are unfit for sale before shipments leave your warehouse.

Reduce Inventory Shrinkage

Inventory shrinkage is the difference between how many products you physically have in stock and what your inventory management software or hand counts recorded. Inventory shrinkage may be due to lost or stolen products, broken workflows, or an error in calculation. Such inaccuracies occur more often when inventory is hand-counted in lieu of using inventory management software. Many companies overlay cycle counting, a form of hand counting, with their inventory management software to ensure inventory is always accurate and never in question.

Establish a Reorder Point (ROP)

To avoid running out of stock, you need to establish a reorder point for your products, especially for high demand inventory. A reorder point refers to when a specific product’s inventory drops below a predetermined threshold and notifies you to order more. Establish a reorder point slightly higher than than the care minimum keeping in consideration the time needed to order and receive the new inventory. The result helps you ensure that your business can continue to sell and ship orders to customers without interruption.

You can calculate your reorder point by multiplying the average time it takes to receive inventory (In days) by your average daily sale of the item (In Units). Then add your current available safety stock to that number to calculate your reorder point.

Understanding Proper Accounting Methods

Accrual basis and cash basis are the two primary methods for managing and recording income and expenses for a small business. As an owner of a small business that stocks inventory items and sells them to the public you will need to use accrual basis accounting.


Supply and Demand

To further build both financial and inventory management for your small business, consider each product’s supply and demand.

Low-Turn Stock Identification

Do you have unsold stock from within the last six months to one year? If so, stop restocking that product and consider discontinuing it. Consider different strategies for getting rid of that stock as excess stock wastes both your warehouse space and capital. You can potential reduce or eliminate stock by offering a discount or presenting a clearance sale to your shoppers.

Utilize “ABC Analysis” Approach

The ABC approach requires you to classify each type of inventory as one of three categories: A, B or C. Typically, “A” products rank most valuable as your best sellers. “B” products rank with a medium but stable consumption value. Finally, “C” products are purchased the least.

Calculate the annual consumption value of a product by multiplying the annual demand by the item cost per unit. Products classified in the “A” category should be subject to tight inventory control and never run out of stock since will be your most frequently ordered and in high demand.

Accurate forecasting is critical to success. Your projected sales calculations should be based on factors such as historical sales figures, market trends, predicted growth and the economy, promotions, and marketing efforts.

Inventory Management KPIs

Establishing Key Performance Indicators (KPIs) are a measurable way to monitor the efficiency of your current inventory management. One of the most important inventory KPIs to manage is inventory turnover ratio. To do so, divide the COGS (Cost of Goods Sold) or net sales by your average inventory. The result is a number that indicates how fast your inventory sells. Utilize the data to compare your average with other competitors within your industry and look for areas of improvement.

Outsource Bookkeeping Tasks

While managing your inventory management tools, let the accounting experts help your business operation grow.

At MCDA CCG Inc., we provide cost-effective, efficient, and accurate accounting services for small businesses throughout the US. We will dedicate a team of specialized staff to meet all of your business needs, partnering with you to conquer day-to-day operations.

For more information please do not hesitate to contact us today at (714) 872-2393 or schedule a call directly utilizing the link below.