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It may be time for your company to create a strategic IT plan

Many companies take an ad hoc approach to technology. If you’re among them, it’s understandable; you probably had to automate some tasks before others, your tech needs have likely evolved over time, and technology itself is always changing.

Unfortunately, all of your different hardware and software may not communicate so well. What’s worse, lack of integration can leave you more vulnerable to security risks. For these reasons, some businesses reach a point where they decide to implement a strategic IT plan.

Setting objectives

The objective of a strategic IT plan is to — over a stated period — roll out consistent, integrated, and secure hardware and software. In doing so, you’ll likely eliminate many of the security dangers wrought by lack of integration, while streamlining data-processing efficiency.

To get started, define your IT objectives. Identify not only the weaknesses of your current infrastructure, but also opportunities to improve it. Employee feedback is key: Find out who’s using what and why it works for them.

From a financial perspective, estimate a reasonable return on investment that includes a payback timetable for technology expenditures. Be sure your projections factor in both:

• Hard savings, such as eliminating redundant software or outdated processes, and
• Soft benefits, such as being able to more quickly and accurately share data within the office as well as externally (for example, from sales calls).

Also calculate the price of doing nothing. Describe the risks and potential costs of falling behind or failing to get ahead of competitors technologically.

Working in phases

When you’re ready to implement your strategic IT plan, devise a reasonable and patient time line. Ideally, there should be no need to rush. You can take a phased approach, perhaps laying the foundation with a new server and then installing consistent, integrated applications on top of it.

A phased implementation can also help you stay within budget. You’ll need to have a good idea of how much the total project will cost. But you can still allow flexibility for making measured progress without putting your cash flow at risk.

Bringing it all together

There’s nothing wrong or unusual about wandering the vast landscape of today’s business technology. But, at some point, every company should at least consider bringing all their bits and bytes under one roof. Please contact our firm for help managing your IT spending in a measured, strategic way.

© 2017

How can you take customer service to the next level?

Just about every business intends to provide world-class customer service. And though many claim their customer service is exceptional, very few can back up that assertion. After all, once a company has established a baseline level of success in interacting with customers, it’s not easy to get to that next level of truly great service. But, fear not, there are ways to elevate your game and, ultimately, strengthen your bottom line in the process.

Start at the top

As is the case for many things in business, success starts at the top. Encourage your fellow owners (if any) and management team to regularly serve customers. Doing so cements customer relationships and communicates to employees that serving others is important and rewarding. Your involvement shows that customer service is the source of your company’s ultimate triumph.

Moving down the organizational chart, cultivate customer-service heroes. Publish articles about your customer service achievements in your company’s newsletter or post them on your website. Champion these heroes in meetings. Public praise turns ordinary employees into stars and encourages future service excellence.

Just make sure to empower all employees to make customer-service decisions. Don’t talk of catering to customers unless your staff can really take the initiative to meet your customers’ needs.

Create a system

Like everyone in today’s data-driven world, customers want information. So strive to provide immediate feedback to customers with a highly visible response system. This will let customers know that their input matters and you’ll reward them for speaking up.

The size and shape of this system will depend on the size, shape and specialty of the company itself. But it should likely encompass the right combination of instant, electronic responses to customer inquires along with phone calls and, where appropriate, face-to-face interactions that reinforce how much you value their business.

Give them a thrill

Consistently great customer service can be an elusive goal. You may succeed for months at a time only to suffer setbacks. Don’t get discouraged. Our firm can help you build a profitable company that excels at thrilling your customers.

© 2017

THE ABCs OF P3s – An Introduction to Public-Private Partnership




The United States is facing consequences from decades of deferred maintenance and underinvestment in infrastructure. At the same time, available public fund levels for such projects are low and resistance to increased taxation is high.  

 

One approach government agencies are exploring to help meet the needs for new infrastructure projects is developing public-private partnerships (P3s) . These arrangements could provide profitable opportunities for contractors in the near future, so its important to know how they work.

 
The concept, defined

Under the P3 model, a public entity (federal, state or local) engages a private partner, which in turn hires, supervises and pays the contractor. The private partner may participate in the design, financing, operation and maintenance of the project, as well as in the construction. The specific role of the private partner varies considerably from one project to another. Ideally, everyone’s role is clearly spelled out in the contract.

 

The types of projects that have been handled as P3s include water and sewer systems, parking facilities, toll bridges, roads, highways and prisons. In some cases, the P3 is formed to develop a new infrastructure project; in others, an existing asset is transferred to a private partner that assumes responsibility for needed upgrades, repairs and ongoing maintenance work.

 

Pros and cons

The chief advantage proponents see in P3s is that both the public and private entities involved do what they do best. The public entity is better able to serve its constituency by targeting and completing the necessary projects. The private partner is motivated to work effectively and efficiently, because its contractually specified compensation depends on good performance.

 

In addition, by working together, P3 partners often are able to develop better infrastructure solutions than either could have come up with on their own. Projects may be built faster when time-to-completion is included as a measure of performance and, thus, profit. Risks are appraised fully before a project moves forward, with the private partner often serving as a check against unrealistic government promises or expectations. Taking advantage of the private partner’s experience in containing costs can mean more efficient use of government funds and resources, too.

 

P3s also present some potential disadvantagesespecially where the size, nature or complexity of the project limits the number of potential private partners. When only a few private entities have the necessary scope and skills to handle the job, there may not be enough competition to ensure cost-effective partnering.


Furthermore, if the
expertise in the partnership is weighted heavily on the private side, it puts the government at an inherent disadvantage. Under those circumstances, it can be difficult for the public partner to accurately assess the proposed costs.

The contractor’s perspective
As mentioned, P3s represent potentially profitable opportunities for contractors with the requisite experience and resources to perform the work. If you want to consider going after one of these projects, it’s important to be aware of the ways they differ from traditional public works construction.


At the
state and local level, laws governing P3s vary widely from state to state and municipality to municipality. They don’t always offer contractors the same protections typically provided in publicly funded projects.

For example, some state P3 laws don’t address bonding requirements at all, while others allow alternative forms of security, such as guarantees from a parent company or equity partner. ( For more information, see “P3s and bonding” above.) Sometimes the security required makes it difficult or even impossible for a subcontractor or supplier to pursue payment claims, which can increase your risk of nonpayment on a P3 project.

Even more onerous, state and local governments own the land on which most P3s are built. Thus, subcontractors can’ t rely on mechanics’ liens for compensation if the general contractor defaults.

Your best interests
Analysts expect P3s to become more prevalent for infrastructure projects in years to come. So you may want to keep an eye out for such work and be prepared to pursue it, assuming the project suits your construction company’s strengths.


If
you do get the chance to participate in a P3, consult your CPA attorney and surety rep before starting work. Youve got to ensure that the contract into which you’re entering will reasonably serve your best interests.


Enhance benefits’ perceived value with strong communication

 

Providing a strong package of benefits is a competitive imperative in today’s business world. Like many employers, you’ve probably worked hard to put together a solid menu of offerings to your staff. Unfortunately, many employees don’t perceive the full value of the benefits they receive.

Why is this important? An underwhelming perception of value could cause good employees to move on to “greener” pastures. It could also inhibit better job candidates from seeking employment at your company. Perhaps worst of all, if employees don’t fully value their benefits, they might not fully use them — which means you’re wasting dollars and effort on procuring and maintaining a strong package.

Targeting life stage

Among the most successful communication strategies for promoting benefits’ value is often the least commonly used. That is, target the life stage of your employees.

For example, an employee who’s just entering the workforce in his or her twenties will have a much different view of a 401(k) plan than someone nearing retirement. A younger employee will also likely view health care benefits differently. Employers who tailor their communications to the recipient’s generation can improve their success rate at getting workers to understand their benefits.

Covering all bases

There are many other strategies to consider as well. For starters, create a year-round benefits communication program that features clear, concise language and graphics. Many employers discuss benefits with their workforces only during open enrollment periods.

Also, gather feedback to determine employees’ informational needs. You may learn that you have to start communicating in multiple languages, for instance. You might also be able to identify staff members who are particularly knowledgeable about benefits. These employees could serve as word-of-mouth champions of your package who can effectively explain things to others.

Identifying sound strategies

Given the cost and effort you put into choosing, developing and offering benefits to your employees, the payoff could be much better. We can help you ensure you’re getting the most bang for your benefits buck.

© 2017

Consider key person insurance as a succession plan safeguard

 

In business, and in life, among the most important ways to manage risk is through insurance. For certain types of companies — particularly start-ups and small businesses — one major threat is the sudden loss of an owner or hard-to-replace employee. To safeguard against this risk, insurers offer key person insurance.

Under a key person policy, a business buys life insurance covering the owner or employee, pays the premiums and names itself beneficiary. Should the key person die while the policy is in effect, the business receives the payout. As you formulate and adjust your succession plan, one of these policies can serve as a critical safeguard.

Costs and coverage

Key person insurance can take a variety of forms. Term policies last for a specified number of years, typically five to 20. Whole life (or permanent) policies, which are generally more expensive, provide coverage as long as premiums are paid, and they gradually build up cash surrender value. This value appears on a business’s balance sheet and may be drawn on, if the business needs working capital.

The cost of key person insurance also depends on the covered individual’s health, age and medical history, as well as the desired death benefit. When budgeting for premiums, bear in mind that premiums generally aren’t tax deductible. On the flip side, death benefits typically aren’t included in the business’s taxable income when received.

In terms of coverage limits, insurers may quote a rule of thumb of eight to 10 times the key person’s annual salary. But every business will have different cash flow needs when a key person unexpectedly dies. A more accurate estimate typically comes from evaluating lost income (or value), as well as the costs of finding and training a suitable replacement.

An important decision

If you’ve already chosen a successor, you can buy a policy that covers both of you. And if you haven’t, it may be even more critical to buy coverage on your life to protect the solvency of your business. Please contact our firm for help deciding whether key person insurance is for you.

© 2017

Could stronger governance benefit your business?

Every company has at least one owner. And, in many cases, there exists leadership down through the organizational chart. But not every business has strong governance.

In a nutshell, governance is the set of rules, practices and processes by which a company is directed and controlled. Strengthening it can help ensure productivity, reduce legal risks and, when the time comes, ease ownership transitions.

Looking at business structure

Good governance starts with the initial organization (or reorganization) of a business. Corporations, for example, are required by law to have a board of directors and officers and to observe certain other formalities. So this entity type is a good place to explore the concept.

Other business structures, such as partnerships and limited liability companies (LLCs), have greater flexibility in designing their management and ownership structures. But these entities can achieve strong governance with well-designed partnership or LLC operating agreements and a centralized management structure. They might, for instance, establish management committees that exercise powers similar to those of a corporate board.

Specifying the issues

For the sake of simplicity, however, let’s focus on governance issues in the context of a corporation. In this case, the business’s articles of incorporation and bylaws lay the foundation for future governance. The organizational documents might:

• Define and limit the authority of each executive,
• Establish a board of directors,
• Require board approval of certain actions,
• Authorize the board to hire, evaluate, promote and fire executives based on merit,
• Authorize the board to determine the compensation of top executives and to approve the terms of employment agreements, and
• Create nonvoting classes of stock to provide equity to the owner’s family members who aren’t active in the business, but without conferring management control.

As you look over this list, consider whether and how any of these items might pertain to your company. There are, of course, other aspects to governance, such as establishing an ethics code and setting up protocols for information technology.

Knowing yourself

At the end of the day, strong governance is all about knowing your company and identifying the best ways to oversee its smooth and professional operation. Please contact our firm for help running a profitable, secure business.

© 2017

4 digital marketing tips for every business

You’d be hard pressed to find a company not looking to generate more leads, boost sales and improve its profit margins. Fortunately, you can take advantage of the sales and marketing opportunities offered by today’s digital technologies to do so. Here are four digital marketing tips for every business:

1. Add quality content to your website. Few things disappoint and disinterest customers like an outdated or unchanging website. Review yours regularly to ensure it doesn’t look too old and consider a noticeable redesign every few years.

As far as content goes, think variety. Helpful blog posts, articles and even whitepapers can establish your business as a knowledge leader in your industry. And don’t forget videos: They’re a great way to showcase just about anything. Beware, however, that posting amateurish-looking videos could do more harm than good. If you don’t have professional video production capabilities, you may need to hire a professional.

2. Leverage social media. If you’re not using social media tools already, focus on a couple of popular social media outlets — perhaps Facebook and Twitter — and actively post content on them. Remember, with some social media platforms, you can create posts and tweets in advance and then schedule them for release over time.

3. Interact frequently. This applies to all of your online channels, including your website, social media platforms, email and online review sites. For example, be sure to respond promptly to any queries you receive on your site or via email, and be quick to reply to questions and comments posted on your social media pages.

4. Tie it all together. It’s easy to end up with a hodgepodge of different online marketing tools that are operating independently of one another. Integrate your online marketing initiatives so they all have a similar style and tone. Doing so helps reassure customers that your business is an organized entity focused on delivering a clear message — and quality products or services.

When it comes to marketing, you don’t want to swing and miss. Our firm can help you assess the financial impact of your efforts and budget the appropriate amount to boosting visibility.

© 2017

Reporting Unclaimed Property

Most businesses have unclaimed property resulting from normal operations. Any asset, tangible or intangible, belonging to a third party that remains unclaimed for a specified period of time is considered unclaimed property. For example, uncashed payroll checks must be turned over to the State after one year; most other property types, such as vendor checks and accounts receivables credit balances, must be turned over after three years. Government entities must turn over all unclaimed property, regardless of property type, after one year.

Michigan’s Uniform Unclaimed Property Act, Public Act 29 of 1995, as amended, requires businesses and government entities to report and remit to the Michigan Department of Treasury abandoned and unclaimed property belonging to owners whose last known address is in Michigan. In addition, every business or government entity that is incorporated in Michigan must report and remit abandoned property belonging to owners where there is no known address.

New for 2017
Entities without unclaimed property to report under the Michigan Uniform Unclaimed Property Act (Public Act 29 of 1995, as amended) are strongly encouraged to file a zero or negative report. Beginning in 2018, all entities registered to do business in the State of Michigan with nothing to report will be required to submit negative reports. All entities have the ability to both report and remit payments electronically.

Information taken from the Michigan Department of Treasury. http://bit.ly/2rzVXzV


3 hot spots to look for your successor

Picking someone to lead your company after you step down is probably among the hardest aspects of retiring (or otherwise moving on). Sure, there are some business owners who have a ready-made successor waiting in the wings at a moment’s notice. But many have a few viable candidates to consider — others have too few.

When looking for a successor, for best results, keep an open mind. Don’t assume you have to pick any one person — look everywhere. Here are three hot spots to consider.

1. Your family. If yours is a family-owned business, this is a natural place to first look for a successor. Yet, because of the relationships and emotions involved, finding a successor in the family can be particularly complex. Make absolutely sure a son, daughter or other family member really wants to succeed you. But also keep in mind that desire isn’t enough. The loved one must also have the proper qualifications, as well as experience inside and, ideally, outside the company.

2. Nonfamily employees. Keep an eye out for company “stars” who are still early in their careers, regardless of their functional or geographic area. Start developing their leadership skills as early as possible and put them to the test regularly. For example, as time goes on, continually create new projects or positions that give them responsibility for increasingly larger and more complex profit centers to see how they’ll measure up.

3. The wide, wide world. If a family member or current employee just isn’t feasible, you can always look externally. A good way to start is simply by networking with people in your industry, former employees and professional advisors. You can also try placing an ad in a newspaper or trade publication, or on an Internet job site. Don’t forget executive search firms either; they’ll help screen candidates and conduct interviews.

At the end of the day, any successor — whether family member, employee or external candidate — must have the right stuff. Please contact our firm for help setting up an effective succession plan.

© 2017

Getting your money’s worth out of a company retreat

Company retreats can cost enormous amounts of time and money. Are they worth it? Sometimes. Large-scale get-togethers can involve considerable out-of-pocket costs. And if the retreat is poorly planned or executed, participants’ wasted time is the biggest expense.

But a properly budgeted, planned and executed retreat can be hugely profitable, producing fresh ideas, renewed enthusiasm and heightened employee morale. Here are a few ways to get your money’s worth out of a company retreat.

Create specific objectives

First, nail down your goals and objectives. Several months ahead of time, determine and prioritize a list of the important issues you want to address. But include only the top two or three on the final agenda. Otherwise, you risk rushing through some items without adequate time for discussion and formalized action plans.

If one of the objectives is to include time for socializing, recreation or relaxation, great. Mixing fun with work keeps people energized. But if staff see the retreat as merely time away from the office to party and golf, don’t expect to complete many work-related agenda items. One successful way to mix work and pleasure is to schedule work sessions for the morning and more fun, team-building exercises later in the day.

Set limits, allow flexibility

Next, work on the budget. Determining available resources early in the planning process will help you set limits for such variable costs as location, accommodations, food, transportation, speakers and entertainment.

Instead of insisting on certain days for the retreat, select a range of possible dates. This openness helps with site selection and makes it easier to negotiate favorable hotel and travel rates. Keep your budget as flexible as possible, building in a 5% to 10% safety cushion. Always expect unforeseen, last-minute expenses.

Have fun

Company retreats are serious business in the sense that you’re sacrificing time and productivity to identify strategic goals and improve teamwork. But these events should still be fun experiences for you and your staff. We can help you establish a reasonable budget to help ensure an enjoyable, productive and cost-effective retreat.

© 2017