It is common in service industries such as janitorial or food service to look at the positions as ones that will have high turnover thinking "the employee will leave anyway as soon as they find something better so why spend a lot of time in the interview process and detailed training program". I hope that is not your attitude but if it is, they will leave as soon as they can because they will sense that attitude in the interview or shortly thereafter.
Let me suggest it is important for us to change the way WE view the positions we have available. I suggest to you that it is time we begin viewing the industry we are in and the positions we have as careers, not just jobs. But, you may be saying, I am only hiring part time employees at a low wage and they are just looking for extra spending money. Let me ask you, how do you think we will ever get people to think of our industry as a career choice if we are not showing them the opportunities that exist? How you treat them may determine if they want to eventually pursue the industry full time. How a prospective or current employee views their job will often mirror the way YOU view their job. It is important that we begin to RECRUIT employees instead of HIRING employees---the difference?
THE DEFINITION OF HIRING IS THE ATTEMPT TO FILL VACANCIES BY WHATEVER MEANS POSSIBLE. (reactive)
When you are hiring people you are reacting to the immediate needs of the day. A supervisor comes to you and says, "I need someone to start tonight in the south end location beginning at 6 PM and working till midnight. They will need to know how to dump trash and run a vacuum". So what do you do?
You begin to go through the stack of applications you have on the corner of your desk. "Okay, I'll call the first three on the top of the stack. That seems to be a good way of screening. I don't remember them but I kept their applications so they must be good".
And of course the first two don't answer but by golly the third one does and you offer them the job by going through a tough screening process. "Have you ever dumped trash? Why yes, my wife has me take it to the curb every Thursday morning. Great, have you ever run a vacuum cleaner. I vacuum the carpets every Saturday morning. Have you ever cleaned a bathroom? No, but I've used one. Sound perfect, can you meet the supervisor here at our office at 5:30 this evening"?
At 5:30 they arrive at your office not looking like the best recruit you have ever seen. They sure sounded better on the phone, older too. You're not sure your new recruit is even breathing so you take them over to a mirror and ask them to breathe on it. They do, but it doesn't fog up. So you breathe on it, see a little fog, and say, "Close enough".
Oh, and did you tell them the job was 25 miles from their home? Exaggeration? Maybe, but if you think backI will venture a guess that you have hired someone in the past in a similar manner.
You see, when all you are doing is trying to hire to fill slots, you are getting whomever you can get because all you are doing is reacting to the current situation.
Now let's move on to recruiting and how it differs from hiring.
THE DEFINITION OF RECRUITING IS THE SYSTEMATIC PROCESS OF LOCATING, SCREENING, HIRING, AND TRAINING POTENTIAL QUALITY GREAT EMPLOYEES.
You see, hiring is only one step in the recruiting process. Unless you do all the steps mentioned above in a professional, systematic way, you will forever be in a panic, high turnover, never ending cycle of frustration.
I suggest that everyone in your organization should be working toward recruiting and not just hiring. A company that I am very familiar with began the process of recruiting and implementing the processes listed above and in my book, Finding, Training, and Keeping GREAT Service Employees 101, was able to reduce their turnover to 25% of the national average for the cleaning industry. It takes a commitment and not just a token memo from the front office.
Don't forget our free week pod casts at www.tripodcast.com. Also, BSCAI has posted the convention program at www.bscai.org. Check it out and register for this exciting October event in Chicago. Hope to see as many of you as possible.
Till next time.
Wednesday, July 11, 2012
Friday, June 29, 2012
ATTITUDES NEEDED TO GROW YOUR COMPANY
This week I thought it would be interesting to list some of those attitudes we need to grow our companies in this competitive, slow economy business environment. We can't ignore the changes that are happening, we must face reality and do what works.
Here are some ideas.
SPEED UP
+++Change won't wait on you
+++Hurry needs to become the normal style
+++Technology is advancing at a dead run
+++Get rid of "busy work" and bureaucratic practices
+++Don't resist change, create it
CONTROL YOUR EMOTIONS
+++Nobody else is in charge of your attitude
+++Bad attitudes lose jobs
+++You can control how you react to change and the world around you
DON'T LET YOUR STRENGTHS BECOME WEAKNESSES
+++What you do best may not fit today
+++Keep learning
+++Adapt
+++Develop in new and exciting directions
+++Be willing to adjust
+++Don't use yesterdays solutions to today's problems
TAKE RESPONSIBILITY
+++Blaming comes easy
+++There are already enough problems, the company needs SOLUTIONS
+++Pointing your finger to others for your mistakes loses jobs
+++Today's culture demands accountability from YOU
Change destroys organizations that don't adjust. Is your company adjusting to the needs of today's economy and competitive environment? Change won't wait on you. You simply don't have time to take time. In the weeks to come we will examine the key points above in greater detail maybe make some suggestions to those of you that feel you need to make a few changes.
You see, every company is made up of three types of people. There are the sponges, the spectators and the camels.
The sponges are the newer employees that want to learn everything they can about how to do there job better. They absorb everything they are told---good and bad. This group generally will make up about 30% of your work force.
The spectators make up about 65% of the work force and they are the ones who are looking around to see what is going on and who's doing what. They waste an enormous amount of time watching and not working. They are quick however to complain about everything that is wrong. They bring their lunch everyday in a lunch bucket. Actually it isn't their lunch in the bucket, it's binoculars so they can watch everybody everywhere instead of work. (Just kidding, not about the watching but about the binoculars).
Then there are the camels which make up the remaining 5% of a normal workforce. These are the people who get most of the work done. These are the ones you go to if a deadline has to be met or you know it has "to be done right".
Now, which one of these three are you? Hopefully you fall into the 5% and if you are a sponge in the 30% category, you will skip over the spectator group and jump into the camel category as soon as possible. These are the people who have the attitudes to grow the company and get ahead in life.
In keeping with the attitudes needed to grow a company, I want to close this session with several of my favorite quotes from a variety of sources. These have helped me in my business attitude growth and I hope they will help you as well.
From Tom Peters---If the other guy's getting better, then you'd better be getting better faster than the other guy's getting better---or you're getting worse.
From Clay Carr---To satisfy the customer, it means that everybody in the company has to understand that the total existence of a company depends upon the customer, so if the customer is not satisfied, he is not going to be a customer tomorrow, and if he's not a customer tomorrow, we don't have a business tomorrow.
From Service America---If you're not satisfying the customer, you'd better be satisfying someone who is.
From Bernard Berenson---I wish I could stand on a busy corner, hat in hand, and beg people to throw me all their wasted hours.
From Dick Ollek---When you say, that's not my job, the one you have won't be for long.
From Zig Ziglar--Many people quit looking for work as soon as they find a job.
From Sherman Potter---Never make 7 people mad when all you are carrying is a 6 shooter.
From Al Batt--It is easy to sit up and take notice, what is difficult is to get up and take action.
So to follow up on Al Batt's quote, Will your organization just take notice or will you TAKE ACTION? You see, the decision is entirely up to you.
Till next time. Don't forget to listen to our free week pod cast at www.tripodcast.com.
Here are some ideas.
SPEED UP
+++Change won't wait on you
+++Hurry needs to become the normal style
+++Technology is advancing at a dead run
+++Get rid of "busy work" and bureaucratic practices
+++Don't resist change, create it
CONTROL YOUR EMOTIONS
+++Nobody else is in charge of your attitude
+++Bad attitudes lose jobs
+++You can control how you react to change and the world around you
DON'T LET YOUR STRENGTHS BECOME WEAKNESSES
+++What you do best may not fit today
+++Keep learning
+++Adapt
+++Develop in new and exciting directions
+++Be willing to adjust
+++Don't use yesterdays solutions to today's problems
TAKE RESPONSIBILITY
+++Blaming comes easy
+++There are already enough problems, the company needs SOLUTIONS
+++Pointing your finger to others for your mistakes loses jobs
+++Today's culture demands accountability from YOU
Change destroys organizations that don't adjust. Is your company adjusting to the needs of today's economy and competitive environment? Change won't wait on you. You simply don't have time to take time. In the weeks to come we will examine the key points above in greater detail maybe make some suggestions to those of you that feel you need to make a few changes.
You see, every company is made up of three types of people. There are the sponges, the spectators and the camels.
The sponges are the newer employees that want to learn everything they can about how to do there job better. They absorb everything they are told---good and bad. This group generally will make up about 30% of your work force.
The spectators make up about 65% of the work force and they are the ones who are looking around to see what is going on and who's doing what. They waste an enormous amount of time watching and not working. They are quick however to complain about everything that is wrong. They bring their lunch everyday in a lunch bucket. Actually it isn't their lunch in the bucket, it's binoculars so they can watch everybody everywhere instead of work. (Just kidding, not about the watching but about the binoculars).
Then there are the camels which make up the remaining 5% of a normal workforce. These are the people who get most of the work done. These are the ones you go to if a deadline has to be met or you know it has "to be done right".
Now, which one of these three are you? Hopefully you fall into the 5% and if you are a sponge in the 30% category, you will skip over the spectator group and jump into the camel category as soon as possible. These are the people who have the attitudes to grow the company and get ahead in life.
In keeping with the attitudes needed to grow a company, I want to close this session with several of my favorite quotes from a variety of sources. These have helped me in my business attitude growth and I hope they will help you as well.
From Tom Peters---If the other guy's getting better, then you'd better be getting better faster than the other guy's getting better---or you're getting worse.
From Clay Carr---To satisfy the customer, it means that everybody in the company has to understand that the total existence of a company depends upon the customer, so if the customer is not satisfied, he is not going to be a customer tomorrow, and if he's not a customer tomorrow, we don't have a business tomorrow.
From Service America---If you're not satisfying the customer, you'd better be satisfying someone who is.
From Bernard Berenson---I wish I could stand on a busy corner, hat in hand, and beg people to throw me all their wasted hours.
From Dick Ollek---When you say, that's not my job, the one you have won't be for long.
From Zig Ziglar--Many people quit looking for work as soon as they find a job.
From Sherman Potter---Never make 7 people mad when all you are carrying is a 6 shooter.
From Al Batt--It is easy to sit up and take notice, what is difficult is to get up and take action.
So to follow up on Al Batt's quote, Will your organization just take notice or will you TAKE ACTION? You see, the decision is entirely up to you.
Till next time. Don't forget to listen to our free week pod cast at www.tripodcast.com.
BUT I TOLD HIM TO DO IT
If you have been in the Building Service Contracting industry for any length of time you no doubt have had that customer complaint where you assured a problem would be taken care of only to have them call the next day and tell you it still had not been corrected. You also have probably had the supervisor who told you when you asked what happened tell you, "But I told him to do it", or am I the only one that ever had that problem?
I remember telling a supervisor who gave me that response a few years ago that if all he was going to do was tell the cleaning tech to correct the problem, I didn't need him because I could have told the cleaner myself and saved a supervisors salary. What I needed from a quality supervisor was to go to the job, examine the issue, and make sure the employee knew how to correct the problem and then if they need training the supervisor provides it. That is supervision, the other method is being a messenger. That particular supervisor never did get the idea and eventually I had to take him to lunch and buy his to go.
This brings rise to another issue that is paramount in the workforce today. Do we all understand each other and the different meanings words can have in the normal course of a training conversation?
In the workshops I do on communications for companies, one of the exercises we have the group do is to provide their definition of the following words,
FIRE---
TRAIN---
DIAMOND---
HIKE---
BAD---
I invite you to take a minute and write down your definition of each of these words. Write down the first thing that comes to your mind. Ready, set, go.
Let me provide some of the answers I get,
FIRE---destroy, terminate, hot, warm, explosion,
TRAIN---choo choo, tracks, locomotive, collision, provide learning for employees,
DIAMOND---expensive, engaged, married, baseball,
HIKE---up the mountain, long walk, take a hike, pay raise,
BAD---good, terrible, poor job, spanking
Take a close look at the definitions provided in the exercise and compare them with your answers. No wonder we sometimes don't get the job done right. When diamond means engaged or baseball and bad means good, we should take a clue that we need to be very explicit in our instructions to our supervisors and they in turn need to be trained on how to be very clear in their teaching and training procedures to the people in the field. Believe me, when my wife asks me for a new diamond, she is not asking me to buy her a baseball. Let me ask you, do you have a training program in your company or a locomotive program in your company?
I am reminded of a story a friend of mine told me about his first job as a grocery sacker at a supermarket when he was 14 years old. He had taken groceries out to the car for a lady and as he placed them in the car trunk (boot in England) the sack split and he had groceries going everywhere. Well, the lady complained to the store manager and my friend was called to the office where he was told his services were going to be terminated. He said, "what's that?". The manager said, "you're fired". My friend said, "now I understand". By the way, I used to have a partner from England in a business venture and his definition of termination was "sack him". Now that complicates matters even more. Do we fire, terminate, or put the employee in a bag (sack)? See what I mean?
You see, every generation and every nation has certain meanings for different words. In the world in which we live we are becoming more and more diverse and employing more and more people from more and more countries with many different cultures and customs. Add to that the different generations and their different ideas about the importance of work and where it fits into their meaning of life, we can become confused rather rapidly.
As managers and supervisors of a very diverse work force here in the 21st century, it is critical that we make sure that our employees understand EXACTLY what we mean when we are communicating and it is also critically important that we have supervisors and team leaders that are true supervisors and not just messengers. They need to make sure that their workforce understands CLEARLY what is expected of them and how they are to correctly perform the duties assigned to them. What about you? Is your organization one of supervisors or one of messengers and do they know how to communicate so they are truly understood?
Till next time.
I remember telling a supervisor who gave me that response a few years ago that if all he was going to do was tell the cleaning tech to correct the problem, I didn't need him because I could have told the cleaner myself and saved a supervisors salary. What I needed from a quality supervisor was to go to the job, examine the issue, and make sure the employee knew how to correct the problem and then if they need training the supervisor provides it. That is supervision, the other method is being a messenger. That particular supervisor never did get the idea and eventually I had to take him to lunch and buy his to go.
This brings rise to another issue that is paramount in the workforce today. Do we all understand each other and the different meanings words can have in the normal course of a training conversation?
In the workshops I do on communications for companies, one of the exercises we have the group do is to provide their definition of the following words,
FIRE---
TRAIN---
DIAMOND---
HIKE---
BAD---
I invite you to take a minute and write down your definition of each of these words. Write down the first thing that comes to your mind. Ready, set, go.
Let me provide some of the answers I get,
FIRE---destroy, terminate, hot, warm, explosion,
TRAIN---choo choo, tracks, locomotive, collision, provide learning for employees,
DIAMOND---expensive, engaged, married, baseball,
HIKE---up the mountain, long walk, take a hike, pay raise,
BAD---good, terrible, poor job, spanking
Take a close look at the definitions provided in the exercise and compare them with your answers. No wonder we sometimes don't get the job done right. When diamond means engaged or baseball and bad means good, we should take a clue that we need to be very explicit in our instructions to our supervisors and they in turn need to be trained on how to be very clear in their teaching and training procedures to the people in the field. Believe me, when my wife asks me for a new diamond, she is not asking me to buy her a baseball. Let me ask you, do you have a training program in your company or a locomotive program in your company?
I am reminded of a story a friend of mine told me about his first job as a grocery sacker at a supermarket when he was 14 years old. He had taken groceries out to the car for a lady and as he placed them in the car trunk (boot in England) the sack split and he had groceries going everywhere. Well, the lady complained to the store manager and my friend was called to the office where he was told his services were going to be terminated. He said, "what's that?". The manager said, "you're fired". My friend said, "now I understand". By the way, I used to have a partner from England in a business venture and his definition of termination was "sack him". Now that complicates matters even more. Do we fire, terminate, or put the employee in a bag (sack)? See what I mean?
You see, every generation and every nation has certain meanings for different words. In the world in which we live we are becoming more and more diverse and employing more and more people from more and more countries with many different cultures and customs. Add to that the different generations and their different ideas about the importance of work and where it fits into their meaning of life, we can become confused rather rapidly.
As managers and supervisors of a very diverse work force here in the 21st century, it is critical that we make sure that our employees understand EXACTLY what we mean when we are communicating and it is also critically important that we have supervisors and team leaders that are true supervisors and not just messengers. They need to make sure that their workforce understands CLEARLY what is expected of them and how they are to correctly perform the duties assigned to them. What about you? Is your organization one of supervisors or one of messengers and do they know how to communicate so they are truly understood?
Till next time.
Saturday, June 23, 2012
PAYING SALES PEOPLE---PART 2
Following last week's post, several people asked about paying straight commission to BSC sales people. That certainly is one way to pay although not used often in our industry.
I personally never used a straight commission structure or had anyone apply that knew anything about this industry that wanted a straight commission career with me. With a 90-120 day lead time usually needed to make the call, do the walk through, present the proposal and secure the signed agreement, the sales representative needs quite a cash reserve until worthwhile sales begin to be made. In addition, in the early months, if the representative comes from outside the industry, it may be difficult to get the sales at a consistently high level to provide any sort of straight commission income.
An exception, of course, might be that successful sales person you secure from a competitor that already has contacts. But then there is usually the issue of a non-compete contract that they have signed with their previous employer so you are unable to take advantage of the contacts they may have. By the way, I have been on both sides of non-compete employment contracts and am a firm believer in them if they are properly constructed. I offer absolutely no legal advice on them but am a believer in them.
A discussion on sales people would not be complete without a brief dissertation on vehicle allowance payments. I have used methods where I provided a car and also where the sales person provided their own vehicle and received a monthly allowance. In the words of the late New York Yankee manager Billy Martin when he appeared in the old Miller Lite beer commercials, "I feel very strongly both ways".
When you provide the car you are in control of the appearance your company makes and you can also be comfortable knowing the vehicle is properly insured as well as maintained if you are paying all expenses.
If the sales person provides their own vehicle, that assurance is not always there. You have to make sure they carry the proper limits on insurance and you need to keep an insurance certificate on file which sometimes slips the minds of even the best managers.
Gas prices are one of the most volatile parts of our economy so the entire discussion of whether the company provides the vehicle or the sales person provides their own is one that requires very careful research as it is a MAJOR investment.
As far as which pay structure to use, that is up to the individual company but I used successfully a salary plus commission program in harmony with one or more methods of executive brief and hit list mailings on a regular basis for support of the sales effort as well as periodic customer/prospect industry update luncheons.
I have on previous occasions discussed providing appropriate support to the sales people and then expecting them to produce. I think it is critical that you develop, with their input, weekly, monthly, and yearly expectations of the business you expect them to produce. I recommend an every Monday morning or Friday morning "sales meeting" to review where you are and the plans of where you are going. Good sales people hate meetings unless they are meeting a prospect, but keep in mind, your Operations and Human Resource departments need to know at all times what sales proposals are being delivered, the status of existing proposals, and which ones are a "definite maybe" to close soon.I personally had every Monday morning conference calls with each sales person in each city in which we operated. We limited them to 30 minutes each and found them to be very productive. We stayed on the subject of sales only. You see, they couldn't sell me anything and I wanted them in front of suspects and prospects as much as possible. Most professional, effective sales people will keep the Operations and Human Resource departments very busy.
As I close this discussion on compensating sales people, I want to emphasize the importance of a coordinated effort of the selling process. I know that I have mentioned it before but if you want to be really successful in your efforts you need to produce support in targeted mailings to specific markets you want to penetrate. You also need to target specific accounts within those markets with specialized mailings and meetings.
And don't forget, sales people are employed to SELL, not to send out mailings, do telemarketing, put together sales proposals etc. If they are not in front of prospects they cannot close a sale. Good sales people won't stay with you if they are asked to do all this support work. Bad sales people will love it because they then have an excuse for not making their sales quota. Which sales person would you rather have?
Don't forget our weekly pod cast at www.tripodcast.com. It's free and only takes about 5 minutes of your time each week.
Till next time.
I personally never used a straight commission structure or had anyone apply that knew anything about this industry that wanted a straight commission career with me. With a 90-120 day lead time usually needed to make the call, do the walk through, present the proposal and secure the signed agreement, the sales representative needs quite a cash reserve until worthwhile sales begin to be made. In addition, in the early months, if the representative comes from outside the industry, it may be difficult to get the sales at a consistently high level to provide any sort of straight commission income.
An exception, of course, might be that successful sales person you secure from a competitor that already has contacts. But then there is usually the issue of a non-compete contract that they have signed with their previous employer so you are unable to take advantage of the contacts they may have. By the way, I have been on both sides of non-compete employment contracts and am a firm believer in them if they are properly constructed. I offer absolutely no legal advice on them but am a believer in them.
A discussion on sales people would not be complete without a brief dissertation on vehicle allowance payments. I have used methods where I provided a car and also where the sales person provided their own vehicle and received a monthly allowance. In the words of the late New York Yankee manager Billy Martin when he appeared in the old Miller Lite beer commercials, "I feel very strongly both ways".
When you provide the car you are in control of the appearance your company makes and you can also be comfortable knowing the vehicle is properly insured as well as maintained if you are paying all expenses.
If the sales person provides their own vehicle, that assurance is not always there. You have to make sure they carry the proper limits on insurance and you need to keep an insurance certificate on file which sometimes slips the minds of even the best managers.
Gas prices are one of the most volatile parts of our economy so the entire discussion of whether the company provides the vehicle or the sales person provides their own is one that requires very careful research as it is a MAJOR investment.
As far as which pay structure to use, that is up to the individual company but I used successfully a salary plus commission program in harmony with one or more methods of executive brief and hit list mailings on a regular basis for support of the sales effort as well as periodic customer/prospect industry update luncheons.
I have on previous occasions discussed providing appropriate support to the sales people and then expecting them to produce. I think it is critical that you develop, with their input, weekly, monthly, and yearly expectations of the business you expect them to produce. I recommend an every Monday morning or Friday morning "sales meeting" to review where you are and the plans of where you are going. Good sales people hate meetings unless they are meeting a prospect, but keep in mind, your Operations and Human Resource departments need to know at all times what sales proposals are being delivered, the status of existing proposals, and which ones are a "definite maybe" to close soon.I personally had every Monday morning conference calls with each sales person in each city in which we operated. We limited them to 30 minutes each and found them to be very productive. We stayed on the subject of sales only. You see, they couldn't sell me anything and I wanted them in front of suspects and prospects as much as possible. Most professional, effective sales people will keep the Operations and Human Resource departments very busy.
As I close this discussion on compensating sales people, I want to emphasize the importance of a coordinated effort of the selling process. I know that I have mentioned it before but if you want to be really successful in your efforts you need to produce support in targeted mailings to specific markets you want to penetrate. You also need to target specific accounts within those markets with specialized mailings and meetings.
And don't forget, sales people are employed to SELL, not to send out mailings, do telemarketing, put together sales proposals etc. If they are not in front of prospects they cannot close a sale. Good sales people won't stay with you if they are asked to do all this support work. Bad sales people will love it because they then have an excuse for not making their sales quota. Which sales person would you rather have?
Don't forget our weekly pod cast at www.tripodcast.com. It's free and only takes about 5 minutes of your time each week.
Till next time.
Thursday, June 14, 2012
HOW SHOULD I PAY MY SALES PEOPLE
I wish I had a dollar for every time a BSC has asked me that question. This area is one of the most discussed areas in all of cleaningdom. Do I pay salary only? Salary plus commission? Commission only? If commission, how much? So let's review a few compensation plans and give you my personal favorites and why.
SALARY ONLY
My opinion of this method is that if a sales representative wants a "salary only" position they are not confident of their ability to bring business in the door. If you agree to pay them in this manner you will almost always end up making them a "former" sales person and the only one who made any money was them. I strongly recommend this method not be used.
SALARY PLUS COMMISSION
Nearly all of the companies I have familiarity with use some variation of this method. It usually consists of a negotiated "livable" base salary plus a car allowance.
Determining the commission structure is usually the tricky part. There are probably about as many types of commission plans being used as there are sales people. Here are a few plans that I am aware of:
------The sales representative receives a percentage of the first months billing payable 30 to 45 days after the contract is started. The percentage can be anywhere from 15% to 40%. The important issue here is there needs to be a check and balance as to pricing of the contract. Many organizations require that before a proposal can be presented, the ownership, operations, and sales departments have to "officially" initial that they have reviewed and approved the pricing. If disagreements occur, they are discussed and then agreed upon BEFORE the presentation is made to the prospect.
------Here the commission paid is a percentage of gross profit that has been agreed upon, again by all departments prior to the sales presentation to the prospect. The amount of commission can be 1, 2, or 3 months gross profit or a percentage of 1,2, or 3 months gross profit.
This method has to have certain guidelines as to "is the gross profit amount agreed to before the sale or is it paid on the actual gross profit generated"?. The first method requires the Operations department to deliver what everyone agreed to whereas the second method pays the sales person on what the Operations department actually delivered. You can imagine the disagreements that can occur if the Operations department doesn't deliver what they agreed to deliver.
------This method pays a percentage of one months contract billing based on the actual labor performed in the second month of the contract AND the percentage will be different dependent on types of accounts sold. Here again, a requirement is that ownership, operations, and sales agree on the projected labor and selling price prior to the presentation being made.
The reason for the different percentages allows for the company to direct the sales department toward the types of accounts it wants in its portfolio. For example, if you are wanting to expand your industrial or medical account base you would increase the percentage of commission paid as well as increasing it on higher volume at acceptable lower labor costs.
I used this method for several years very effectively and it allowed us to increase our customer base AND DO IT PROFITABLY in the areas we wanted to grow. We paid handsome commissions but we also accomplished what we wanted. Our sales people liked it as well because it really focused them on the types of accounts to spend their time on. We paid almost nothing for retail and tenant occupied buildings because that was not our focus. We concentrated on owner occupied, industrial and medical facilities and the system work very well.
Because our company relied very heavily on selling consumables to our customers we also paid the sales person commission on those type of sales made to the customer for a certain period of time--usually 1 year. We did not ask the sales person to make calls to obtain the consumable sales. They were to negotiate that with the contract sale and then our operations department took it from there. This was a very nice add on, profitable business for us.
------This method pays an ongoing monthly commission for as long as the company has the account. This provides for the sales representative to receive 1,2, or 3 percent of the monthly billing with no more selling needed to that account. Some companies will ask the sales representative to make customer relations calls to justify the monthly commission. Want to start a real fight in your organization? Have the sales person make those calls. It creates havoc in the organization AND it keeps the sales person from doing what you are paying them to do---SELL.
Some companies use a variation of this system by paying a higher amount the first year, a lesser amount the second year, and then eventually phasing out the commission completely.
I personally am not a fan of the ongoing commission structure as I believe sales people can become complacent and "get comfortable" with their salary and ongoing commission. I firmly believe you pay an attractive commission one time and provide the appropriate support of the sales people and then expect them to succeed.
In a later blog we will discuss the management of sales people as well as you can manage a good sales person, but for now I want to emphasize that you hire sales people to SELL, not put sales proposals together or do mailings etc. You want them in front of prospects closing sales not in the office doing work that the support staff should be doing. The fact is, good sales people WON'T do it. They want to be out beating the bushes.
This subject could be discussed forever but we are going to stop here and as I said earlier we'll discuss other parts of sales and sales management in future discussions.
Don't forget to listen to our weekly free tripodcast at www.tripodcast.com. We enjoy doing them and hope they are helpful to you as well.
Till next time.
Determining the commission structure is usually the tricky part. There are probably about as many types of commission plans being used as there are sales people. Here are a few plans that I am aware of:
------The sales representative receives a percentage of the first months billing payable 30 to 45 days after the contract is started. The percentage can be anywhere from 15% to 40%. The important issue here is there needs to be a check and balance as to pricing of the contract. Many organizations require that before a proposal can be presented, the ownership, operations, and sales departments have to "officially" initial that they have reviewed and approved the pricing. If disagreements occur, they are discussed and then agreed upon BEFORE the presentation is made to the prospect.
------Here the commission paid is a percentage of gross profit that has been agreed upon, again by all departments prior to the sales presentation to the prospect. The amount of commission can be 1, 2, or 3 months gross profit or a percentage of 1,2, or 3 months gross profit.
This method has to have certain guidelines as to "is the gross profit amount agreed to before the sale or is it paid on the actual gross profit generated"?. The first method requires the Operations department to deliver what everyone agreed to whereas the second method pays the sales person on what the Operations department actually delivered. You can imagine the disagreements that can occur if the Operations department doesn't deliver what they agreed to deliver.
------This method pays a percentage of one months contract billing based on the actual labor performed in the second month of the contract AND the percentage will be different dependent on types of accounts sold. Here again, a requirement is that ownership, operations, and sales agree on the projected labor and selling price prior to the presentation being made.
The reason for the different percentages allows for the company to direct the sales department toward the types of accounts it wants in its portfolio. For example, if you are wanting to expand your industrial or medical account base you would increase the percentage of commission paid as well as increasing it on higher volume at acceptable lower labor costs.
I used this method for several years very effectively and it allowed us to increase our customer base AND DO IT PROFITABLY in the areas we wanted to grow. We paid handsome commissions but we also accomplished what we wanted. Our sales people liked it as well because it really focused them on the types of accounts to spend their time on. We paid almost nothing for retail and tenant occupied buildings because that was not our focus. We concentrated on owner occupied, industrial and medical facilities and the system work very well.
Because our company relied very heavily on selling consumables to our customers we also paid the sales person commission on those type of sales made to the customer for a certain period of time--usually 1 year. We did not ask the sales person to make calls to obtain the consumable sales. They were to negotiate that with the contract sale and then our operations department took it from there. This was a very nice add on, profitable business for us.
------This method pays an ongoing monthly commission for as long as the company has the account. This provides for the sales representative to receive 1,2, or 3 percent of the monthly billing with no more selling needed to that account. Some companies will ask the sales representative to make customer relations calls to justify the monthly commission. Want to start a real fight in your organization? Have the sales person make those calls. It creates havoc in the organization AND it keeps the sales person from doing what you are paying them to do---SELL.
Some companies use a variation of this system by paying a higher amount the first year, a lesser amount the second year, and then eventually phasing out the commission completely.
I personally am not a fan of the ongoing commission structure as I believe sales people can become complacent and "get comfortable" with their salary and ongoing commission. I firmly believe you pay an attractive commission one time and provide the appropriate support of the sales people and then expect them to succeed.
In a later blog we will discuss the management of sales people as well as you can manage a good sales person, but for now I want to emphasize that you hire sales people to SELL, not put sales proposals together or do mailings etc. You want them in front of prospects closing sales not in the office doing work that the support staff should be doing. The fact is, good sales people WON'T do it. They want to be out beating the bushes.
This subject could be discussed forever but we are going to stop here and as I said earlier we'll discuss other parts of sales and sales management in future discussions.
Don't forget to listen to our weekly free tripodcast at www.tripodcast.com. We enjoy doing them and hope they are helpful to you as well.
Till next time.
Saturday, June 9, 2012
WE HAVE TRAINED PERSONNEL
How many times have you heard the phrase "We have trained personnel" or better yet, how many times have you used it yourself? It seems to be the slogan for every BSC all over the world. Now, my question is this,
Since the initial training and orientation class (if you have one), when was the last time you had all of your line technicians go through a refresher course to assure they are doing the processes and procedures that you are telling the customer you possess? Many companies (yours?) put their new employees through an orientation and then put them in the field never to provide any additional technical training. So when your employee reaches the 3 year or 5 year time of being with you they have one hours training 3 or 5 years over. Sound at all familiar?
This brings me to the issue that many BSC's have. They hire a new employee, give them the orientation and some initial technical training and then put them in the field to work with and learn from an "experienced" cleaner. And more often than not, that experienced cleaner is one that has learned to do it wrong. Oh!, they really don't mean to do it wrong, they just got into some bad habits over the months and years and no one has corrected them and so their "wrong" way of doing the procedure all of a sudden becomes the accepted way of the company and the new employee becomes an expert at doing it "wrong".
My company instituted the every 6 month program for the very reasons listed above. We were a Team Cleaning company using exclusively back packs and those of you that do Team Cleaning the accepted way know that while it is a terrific way to do a thorough job in a fraction of the time needed for zone cleaning, it can also be difficult to implement. After instituting Team Cleaning, about 3-4 months into the program I began to do random visits to our buildings to see how the procedure was working in the field. To my amazement I saw some cleaning procedures I didn't recognize and frankly, didn't want to recognize. I wondered if these were the same employees that were at the initial training. The faces looked familiar but the cleaning procedures sure didn't. Anybody had that happen to them? Anyway, I guess this negative turned into a positive because it forced us into the on going every 6 month training process (more on this later).
You may have heard me say in a workshop or read in one of my books that "on the job training is a recipe for on the job failure". Not intentionally, but it just evolves if a company doesn't have an on going follow up training policy. That brings me to my next point,
If you have not already done so I want to suggest that you implement a program whereby each employee is required to attend a 2 hour refresher course in your main office or training center every six months following their date of employment. You can hold them at different times on different days to allow for the schedules of your employees, knowing that many have other jobs, full time. Pay them to attend and one good procedure is to let one of the "experienced" cleaners teach different segments of the training. This lets you observe if they have picked up any bad habits and allows for you to correct them. Always correct in a positive, helpful fashion and not in a "gotcha" attitude. I am of the opinion that you will learn that there are all kinds of cleaning procedures taking place out in the field that you weren't aware of. I surely learned that.
At the risk of sounding too elementary let me remind you of how we remember in a learning situation. We remember,
10% of what we read
20% of what we hear
30% of what we see
50% of what we see and hear
80% of what we say
90% of what we say AS WE DO.
So it follows that you will want to involve the class in the training and let as many of them as possible teach the rest of the group by saying AND doing a procedure. It really does provide for a better learning atmosphere. That is one of the reasons I suggest you have those "old timers" involved in demonstrating the various procedures because these are probably the ones you are relying on the most and you want to make sure they are doing it right. Remember, all of us learn one step at a time.
An additional thought---make the training fun. Give prizes for correct answers and get everyone involved. I have learned through the ages that giving prizes like cash or grocery gift certificates gets all the shy ones and those feeling like they were forced to attend involved in a hurry. Amazing.
So, how about it? Do you have a follow up training program or do you just train when they are hired and then train only supervisors after that? Remember, the cleaning techs are the ones doing the work that customers are paying for. How does your staff measure up. If you don't have an ongoing technical training program, now would be a GREAT time to begin. With all the new products, including green, on the market today, your employees need to have a thorough knowledge of how to use them and that needs to come from you, and not trial and error. Happy training.
Don't forget to listen to our every Monday morning tripodcast at www.tripodcast.com. You can sign up to receive a notice whenever one is published just by entering you e-mail address and clicking the orange icon.
Since the initial training and orientation class (if you have one), when was the last time you had all of your line technicians go through a refresher course to assure they are doing the processes and procedures that you are telling the customer you possess? Many companies (yours?) put their new employees through an orientation and then put them in the field never to provide any additional technical training. So when your employee reaches the 3 year or 5 year time of being with you they have one hours training 3 or 5 years over. Sound at all familiar?
This brings me to the issue that many BSC's have. They hire a new employee, give them the orientation and some initial technical training and then put them in the field to work with and learn from an "experienced" cleaner. And more often than not, that experienced cleaner is one that has learned to do it wrong. Oh!, they really don't mean to do it wrong, they just got into some bad habits over the months and years and no one has corrected them and so their "wrong" way of doing the procedure all of a sudden becomes the accepted way of the company and the new employee becomes an expert at doing it "wrong".
My company instituted the every 6 month program for the very reasons listed above. We were a Team Cleaning company using exclusively back packs and those of you that do Team Cleaning the accepted way know that while it is a terrific way to do a thorough job in a fraction of the time needed for zone cleaning, it can also be difficult to implement. After instituting Team Cleaning, about 3-4 months into the program I began to do random visits to our buildings to see how the procedure was working in the field. To my amazement I saw some cleaning procedures I didn't recognize and frankly, didn't want to recognize. I wondered if these were the same employees that were at the initial training. The faces looked familiar but the cleaning procedures sure didn't. Anybody had that happen to them? Anyway, I guess this negative turned into a positive because it forced us into the on going every 6 month training process (more on this later).
You may have heard me say in a workshop or read in one of my books that "on the job training is a recipe for on the job failure". Not intentionally, but it just evolves if a company doesn't have an on going follow up training policy. That brings me to my next point,
If you have not already done so I want to suggest that you implement a program whereby each employee is required to attend a 2 hour refresher course in your main office or training center every six months following their date of employment. You can hold them at different times on different days to allow for the schedules of your employees, knowing that many have other jobs, full time. Pay them to attend and one good procedure is to let one of the "experienced" cleaners teach different segments of the training. This lets you observe if they have picked up any bad habits and allows for you to correct them. Always correct in a positive, helpful fashion and not in a "gotcha" attitude. I am of the opinion that you will learn that there are all kinds of cleaning procedures taking place out in the field that you weren't aware of. I surely learned that.
At the risk of sounding too elementary let me remind you of how we remember in a learning situation. We remember,
10% of what we read
20% of what we hear
30% of what we see
50% of what we see and hear
80% of what we say
90% of what we say AS WE DO.
So it follows that you will want to involve the class in the training and let as many of them as possible teach the rest of the group by saying AND doing a procedure. It really does provide for a better learning atmosphere. That is one of the reasons I suggest you have those "old timers" involved in demonstrating the various procedures because these are probably the ones you are relying on the most and you want to make sure they are doing it right. Remember, all of us learn one step at a time.
An additional thought---make the training fun. Give prizes for correct answers and get everyone involved. I have learned through the ages that giving prizes like cash or grocery gift certificates gets all the shy ones and those feeling like they were forced to attend involved in a hurry. Amazing.
So, how about it? Do you have a follow up training program or do you just train when they are hired and then train only supervisors after that? Remember, the cleaning techs are the ones doing the work that customers are paying for. How does your staff measure up. If you don't have an ongoing technical training program, now would be a GREAT time to begin. With all the new products, including green, on the market today, your employees need to have a thorough knowledge of how to use them and that needs to come from you, and not trial and error. Happy training.
Don't forget to listen to our every Monday morning tripodcast at www.tripodcast.com. You can sign up to receive a notice whenever one is published just by entering you e-mail address and clicking the orange icon.
Monday, May 28, 2012
THE MID YEAR REVIEW
As we close out May 2012 and move into June we are also closing in on the halfway point of the year. If your company is on a fiscal year you have already passed the halfway point. So...how you doing on your projections and goals for this year? Let's take a look,
Sales---Have you reached the half way point in what you projected your sales would be? Are you on target with contacting the prospects you put on your list to focus on this year. Each year we would target a group of suspects that we wanted to become prospects and then customers. We would send them periodic "hit list" mailers that really got there attention and then we followed up with a phone call to ask for a 20 minute appointment to discuss how we could mutually benefit each other. We always kept that initial appointment to 20 minutes unless the they asked us to stay. In fact, I took my watch off and laid it on the desk and told the prospect I asked for 20 minutes and would not stay past that time unless they asked me too. I only had one person ever tell me my 20 minutes was up and I could leave. I did.
Our mailings ranged from a baby metal trash can with our message inside to a pill bottle with a prescription to contact our company for relief, to a small first aid kit for the summer sun and insect bites. All of these grabbed their attention and most always got us "in the door" for an appointment. Our book, Selling Contract Cleaning Services 101 describes in detail each of these mailings and their effectiveness. If you have not tried such a campaign let me recommend you start thinking about doing it. It works. We had a criteria established for a suspect to make our list such as gross volume, profitability projections etc. Not only are these mailings effective at bringing new business in the door they are fun to do.
Operations--How you doing on keeping your labor expenses on budget? Do you have a budget? Are you monitoring the labor costs EVERY DAY or do you just look at the profit and loss each month and then cry? If you have several accounts I am suggesting that you create a report EVERY DAY that will give you the over and under on each account. Looking once a month at the labor is to late. This is your biggest expense and you need to monitor it every day.
Now, how about your supplies? I realize this is a small amount compared to labor and many contractors don't really pay much attention to this item. But, if you are running 5% and the average is 3%, what could you do with an additional 2 points on your bottom line. Two percent of a $250,000 per year contractor is $5,000. Great shopping money or look at it this way. $5,000 will pay your expenses and then some to attend the annual BSCAI convention and ISSA trade show so you can learn more about your industry.
Speaking of money and the convention, have you checked into the BSCAI Purchase Advantage Program through NSA. From what I have seen it can save you SUBSTANTIAL dollars in your supply and equipment purchases. I picked up some price comparison information at the recent Executive Seminar in Scottsdale and was really impressed at the savings available through this program. I suggest you check it out at your earliest convenience by going to the BSCAI web site and clicking on the proper icon. They provide monthly webinars where you can get the information and see if it will work for your company. It's certainly worth investigating.
Looking at the numbers is not always fun but extremely necessary. If you aren't into budgeting I want to suggest that you work hard to establish one for the upcoming year. You will learn a great deal about your own organization. I went through the process every year with each one of my district managers and thought I knew what was going on but learned something new about my company every time I did the process. You'll also find that you get better at it each time you do it.
So check your numbers and your processes. If you're not where you want to be there is still time to make a u turn and get on the right track. This business is exciting as well as fun but does need your constant attention to make sure it is doing what you want it to do for you. Your future may depend on it.
Till next time.MAKE IT A GREAT DAY.
Sales---Have you reached the half way point in what you projected your sales would be? Are you on target with contacting the prospects you put on your list to focus on this year. Each year we would target a group of suspects that we wanted to become prospects and then customers. We would send them periodic "hit list" mailers that really got there attention and then we followed up with a phone call to ask for a 20 minute appointment to discuss how we could mutually benefit each other. We always kept that initial appointment to 20 minutes unless the they asked us to stay. In fact, I took my watch off and laid it on the desk and told the prospect I asked for 20 minutes and would not stay past that time unless they asked me too. I only had one person ever tell me my 20 minutes was up and I could leave. I did.
Our mailings ranged from a baby metal trash can with our message inside to a pill bottle with a prescription to contact our company for relief, to a small first aid kit for the summer sun and insect bites. All of these grabbed their attention and most always got us "in the door" for an appointment. Our book, Selling Contract Cleaning Services 101 describes in detail each of these mailings and their effectiveness. If you have not tried such a campaign let me recommend you start thinking about doing it. It works. We had a criteria established for a suspect to make our list such as gross volume, profitability projections etc. Not only are these mailings effective at bringing new business in the door they are fun to do.
Operations--How you doing on keeping your labor expenses on budget? Do you have a budget? Are you monitoring the labor costs EVERY DAY or do you just look at the profit and loss each month and then cry? If you have several accounts I am suggesting that you create a report EVERY DAY that will give you the over and under on each account. Looking once a month at the labor is to late. This is your biggest expense and you need to monitor it every day.
Now, how about your supplies? I realize this is a small amount compared to labor and many contractors don't really pay much attention to this item. But, if you are running 5% and the average is 3%, what could you do with an additional 2 points on your bottom line. Two percent of a $250,000 per year contractor is $5,000. Great shopping money or look at it this way. $5,000 will pay your expenses and then some to attend the annual BSCAI convention and ISSA trade show so you can learn more about your industry.
Speaking of money and the convention, have you checked into the BSCAI Purchase Advantage Program through NSA. From what I have seen it can save you SUBSTANTIAL dollars in your supply and equipment purchases. I picked up some price comparison information at the recent Executive Seminar in Scottsdale and was really impressed at the savings available through this program. I suggest you check it out at your earliest convenience by going to the BSCAI web site and clicking on the proper icon. They provide monthly webinars where you can get the information and see if it will work for your company. It's certainly worth investigating.
Looking at the numbers is not always fun but extremely necessary. If you aren't into budgeting I want to suggest that you work hard to establish one for the upcoming year. You will learn a great deal about your own organization. I went through the process every year with each one of my district managers and thought I knew what was going on but learned something new about my company every time I did the process. You'll also find that you get better at it each time you do it.
So check your numbers and your processes. If you're not where you want to be there is still time to make a u turn and get on the right track. This business is exciting as well as fun but does need your constant attention to make sure it is doing what you want it to do for you. Your future may depend on it.
Till next time.MAKE IT A GREAT DAY.
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