Business Ideas

business ideasWhat business should you start? This is one of the most common and important questions you could ask. It’s a very personal question so there’s no easy answer. The simple answer – it depends.

To help you find the answer to this question some guidelines can be helpful. The following guideline applies not only to what business you should start, but also to careers in general. Success and happiness with your work involves figuring out three things:

1) What do you do well? Come up with a list of what you do well. This list can include any hobbies and interests besides strictly professional skills. For example, a short list might include:

  • Tennis
  • Graphic design
  • Socializing
  • Spreadsheet work
  • Basket-weaving
  • Teaching

2) What do you enjoy doing? Out of all of the things you do well, which are the ones you enjoy the most. Let’s say your favorite activities are graphic design, basket-weaving and teaching.

3) What is currently in demand in the marketplace? Let’s say, (hypothetically of course) you determine that there are way too many graphic designers out there at the moment and very little demand for that skill. Well, you can take graphic design off your list. This leaves basket-weaving and teaching. Let’s say you determine that there is demand for these skills.

Of course you could get a job in an organization as a teacher or a basket-weaver but we’re talking about starting a business, so we can focus on what business prospects might be possible for these skills.

Maybe you start a basket-weaving company and sell your baskets in retail channels and/or on the Internet.

You could start a business teaching others how to basket-weave. Why not create instructional basket-weaving videos and start off by selling them online? There are many possibilities.

Growth Industries

If you’re looking for markets that are growing, businesses that cater to the needs of the aging baby boomer population is a great place to start. There are plenty of boomer related business opportunities including providing travel packages, financial planning services and assistive technologies. Another growth market is for green technologies. Businesses are increasingly hopping on the “green” bandwagon. The market for green technologies and services are likely to grow for some time to come.

Ask Others

Float your ideas by family and friends that you trust. It’s always good to get other opinions and possibly ideas. Remember, there will always be folks that don’t like your ideas but that doesn’t necessarily mean that they aren’t good ones!

Why Start a Business?

start business Why would anyone want to start a business in the first place? The are risks associated with starting a business are not the types of risks most folks are used to. Starting from scratch can be stressful and discouraging. You might feel that you’re assuming much more responsibility than you’re used to. You may often be alone with your problems because help isn’t always easily accessible. It seems like a daunting prospect with many pitfalls.

Many of us get used to a job routine with a steadily growing salary. We become accustomed to an increasingly expensive standard of living. The thought of starting a business and suddenly having little or no income can be frightening. Gradually, a new venture seems less and less like a viable option. Nevertheless, there are many reasons to start your own venture. Here are just a few.

Greater potential

Let’s face it, working a job in most companies means you have a salary that won’t increase beyond a few percentage points per year. If you play your cards right, a business of your own has the potential to generate a lot more wealth. According to the authors of The Millionaire Next Door, roughly “two-thirds of American millionaires are self-employed.” Of course, any business can fail, but the potential is there.

Less risk?

Many people think that being an entrepreneur is risky because you’re not guaranteed a steady salary. True enough, but today’s workplace doesn’t offer high levels of job security. Companies (large and small) have near absolute power to lay off their employees, cut their benefits, hours, or other employment terms, often with little or no notice. As we have seen, these are far from rare occurrences.

Owning your own business can be less risky than most people think. Start-ups often also cost less than most people think – most companies get started on a low budget. Once your business is established, you get to decide how to serve your customers, and you reap the rewards!

Necessity

You might start your own business out of necessity. Maybe the job market is slow or you simply can’t find a job that appeals to you. Starting a new venture is an alternative that can lead you down a new and exciting path.

Change

Maybe you’re just fed up of working for someone else. How many of us had a boss or job we grew to hate? Maybe you want to try something new or want to follow a dream. Maybe you figure “life is short, so better try!” Wanting to make a life change is a perfectly valid reason to start a business.

A caveat is in order here. Entrepreneurs sometimes loose their shirts on their ventures. Be sure to set milestones and be ready to withdraw at a certain point. A business plan will help you set these objectives. Closing a business that you are emotionally vested in is difficult but far better than spending your life savings trying to salvage a doomed venture. Some use a rule of thumb that if there’s no significant progress after 2 years, consider closing shop.

Management Follies

More often than we like, companies engage in what’s been called “the folly of rewarding A, while hoping for B.” Organizations do this when they hope that employees will engage in one behavior, but they reward for another type.

Take the story of Peter Gorelkin, who worked as a tractor operator planting grain at a farm in Siberia in the former soviet union. His supervisor was paid by the number of hectares Gorelkin was able to plant. The grain was supposed to be planted at a depth of 6 centimeters to be sure it would germinate, but Gorelkin’s supervisor insisted that the grain be planted only 3 centimeters deep. The supervisor knew that planting grain at only 3 centimeters would allow the operator to cover more hectares per day. This meant more pay for the supervisor even though most of the seeds might not survive.

We don’t need to look as far as an obscure case in Siberia a long time ago. The table below provides further examples of common management reward follies.

Management Reward Follies
We hope for… But we reward…
Teamwork and collaboration The best team members
Innovative thinking and risk-taking Proven methods and not making mistakes
Development of people skills Technical achievements and accomplishments
Employee involvement and empowerment Tight control over operations and resources
High achievement Another year’s effort
Long-term growth; environmental responsibility Quarterly Earnings
Commitment to total quality Shipping on schedule, even with defects
Candour; surfacing bad news early Reporting on good news, whether it’s true or not; agreeing with the manager, whether or hot he or she is right

Three themes seem to make up the biggest obstacles to ending this folly:

  1. Individuals (both employees and management) are unable to break out of old ways of thinking about reward and recognition practices.
  2. Organizations often don’t look at the big picture of their performance system.
  3. Both management and shareholders often focus on short-term results, rather than rewarding employees for planning for longer ranges.

It may seem like common sense that if you’re objective is “team performance”, you shouldn’t reward each individual according to individual productivity. But common sense doesn’t always prevail. Why is the compensation of so many CEOs linked to accounting-based and stock market-based incentives? Both incentives focus on the short-term. Many expenditures that might have long-term benefits are cut (such as R&D for product innovation, or marketing expenses to penetrate new markets). Executive pay is just another example of how it’s much better to reward the desired outcome, by including a mix of factors that account for both sort-term performance, and longer-term strategic decision making.

How to Hold Efficient Group Meetings

Efficient MeetingsGroup meetings have a reputation for being notoriously inefficient. We’ve all been in meetings that last hours but don’t seem to accomplish much. Inefficient group meetings don’t have to be a fact of business life, there are steps that can be taken to make meetings more effective. Stephen Robbins and Phillip Hunsaker, authors of Training in Interpersonal Skills, describe 12 steps that can help improve how group meetings are conducted. We’ve outlined them for you in this article.

When you’re responsible for running a group meeting, follow these steps:

  1. Prepare a meeting agenda. The agenda defines the meeting’s purpose (and ensures that the meeting actually has a purpose) as well as what you hope for it to accomplish. It should list who will attend and what, if any, preparation is required from those who will attend. Don’t force people who don’t really need to be there sit through a long meeting. If an update is enough, send them one via email after the meeting. The agenda should also list in detail what is to be covered and indicate a specific start and ending time.
  2. Distribute the agenda in advance. Participants need advanced notice to properly prepare for meetings. Even if no formal preparation is required by participants, advanced notice will allow them to think about meeting topics so that they can contribute fully.
  3. Consult with participants before the meeting. Unprepared participants don’t contribute to meetings as much as they could. Ensure that members are prepared by checking with them in advance.
  4. Go over the agenda with the participants. The first thing to be done in a meeting is to have participants review the agenda, make any changes and then approve the final agenda.
  5. Establish specific time frames. Meetings should start on time and end at a specified time. It’s your responsibility to specify these times and hold to them.
  6. Keep the discussion focused. Getting off track is a common problem. It’s your responsibility to keep the discussion focused on the issues as well as to minimize interruptions and irrelevant comments.
  7. Encourage all members to participate. To make problem-oriented meetings as effective as possible, everyone at the meeting should be supported and encouraged to contribute. Quiet or reserved people sometimes need to be drawn out so that their ideas can be heard.
  8. Maintain a balanced style. Effective group leaders push when necessary and stay passive when need be.
  9. Encourage idea clashes. It’s important to encourage different points of view, critical thinking and constructive disagreement.
  10. Discourage personality clashes. Quickly intervene to stop personal attacks or other forms of verbal insults.
  11. Listen effectively. Listen to each participant’s comments with intensity, empathy and objectivity. Do whatever is necessary to get the full intended meaning of each participant’s coments.
  12. Close properly. Close a meeting by summarizing what the group accomplished. Clarify what actions need to follow the meeting and allocate follow-up assignments. Determine who will be responsible for communicating and implementing any decisions that were made.

Effective meetings don’t have to be overly formal. Adding some fun and humor can take away some of the tediousness often associated with meetings. You may also consider serving snacks and non-alcoholic drinks. Eating together helps people feel more comfortable around each other.

For a more in-depth analysis, take a look at “How to Make Meetings Less Terrible” at Freakonomics.

Employee Empowerment

Employee EmpowermentWhat is Empowerment and Why is it a Good Thing?

Empowerment means giving employees lower down in the organization more responsibilities and decision-making power. Empowered employees feel they have the ability to make decisions and put them into action.

Why is employee empowerment beneficial? Numerous studies over the years have shown that empowered employees and teams are more likely to be motivated, satisfied, productive and less likely to think about quitting.

Employees With Owner Mentality

Empowered personnel are expected to act, at least in some small way, like owners of the company rather than just employees. Ownership doesn’t have to be in the financial sense. Rather, it is in terms of identifying with and adopting the company’s goals and mission. University of Toronto management professor Dan Rotman lists four conditions that have to me met for employees to be empowered and have an ownership mentality. These conditions give us some insight about how we can go about empowering employees.

  1. There must be a clear definition of the values and mission of the company.
  2. The company must help employees acquire the relevant skills.
  3. Employees must be supported in their decision-making, and not criticized when they try to do something extraordinary.
  4. Workers need to be recognized for their efforts.

Cynicism About Empowerment

All to often employees are told they are empowered but they don’t feel they have the authority to act, or feel like management still micromanages and second guesses their activities. This is because managers can be afraid of sharing or relinquishing their own power. Some managers worry that employees might work on tasks and goals that aren’t aligned with company objectives. Very often, managers simply don’t know how to go about empowering their employees. These managerial failings have caused a lot of cynicism in many work places about the concept of empowerment.

The Needs of the Empowered

When employees are empowered, they are given decision-making authority about some aspect of their job. In order to be fully empowered, employees need:

  • Access to the information required to make decisions
  • Rewards for acting in appropriate and responsible ways
  • Authority to make the necessary decisions
  • Access to the company resources necessary to implement their decisions

Managers have to understand that empowerment is an important strategic tool. In order to reap the benefits, managers must allow for, and encourage, the above bullet points to happen. Otherwise, talk about empowerment will be perceived as “lip service” by employees, and have no positive effect.

Avoid a Backfire by Setting Boundaries

All this being said, establishing the boundaries of empowerment is important so that employees aren’t handed responsibilities beyond their current job description. Empowerment efforts can alienate employees if it makes them feel overworked or taken advantage of. Management must make sure employees know which decisions should be managed higher up. 

Improving Group Performance

Improving group performanceWorking in groups is almost always an inevitable life experience, even for those who prefer to work alone. Therefore, it’s helpful to think about how to improve group interaction and performance.

Creating conditions that lead to more productive groups means we need to look at the nature of group dynamics. In this article, we discuss why people join groups, how groups evolve, what makes a group work well, and how to build a better working group.

Defining Groups

Just to make it clear, for our purposes, we can define a group as being two or more interdependent people, who’ve come together to accomplish specific goals. A work group interacts mainly to share information and make decisions to help each group member perform better in his or her area of responsibility.

Work teams differ from groups in that teams engage in collective work that requires a joint effort. With teams, the overall level of performance is greater than the sum of individual input. More information about teams can be found in our article on improving teamwork.

Reasons Groups are Formed

Hermits are rare because humans are “social animals”. We evolved living and working with other people – balancing our personal needs with those of the group. This enhanced our chances of survival.

Humans join groups for a variety of reasons, including:

  • Security, there is strength in numbers
  • Status, being a part of an important group provides recognition and status for its members
  • Self-esteem, besides conveying status to those outside the group, the group can give members increased feelings of self-worth.
  • Power and goal achievement, what can’t be done alone, can often be done in a group by pooling knowledge and talents.

Reducing Anxieties – Group Development Stages

Many people find working in groups to be difficult and stressful, especially in the early stages. Understanding the stages of group development can help address these anxieties. The two main group development models are the Five-Stage Model and the Punctuated-Equilibrium Model.

The Five-Stage Model

In the 1960’s, psychologists broke up group development into 5 separate stages. We now know that groups don’t pass through these stages linearly or precisely, nevertheless the stages can help us understand group dynamics.

  1. Forming: This first stage is characteristic by a lot of uncertainty about the group’s leadership, structure and purpose. Members often “test the waters” to see what type of behavior is acceptable.
  2. Storming: Have you ever noticed that some people in your groups simply didn’t seem to get along, and sometimes power struggles emerged? This is typical of the storming stage, in which there can be a lot conflict within the group. Even though members accept the group, they resist the constraints imposed on their individuality. Once past this stage, a clearer leadership hierarchy becomes noticeable.
  3. Norming: The third stage of group development is characterized by cohesiveness and close relationships. The group structure solidifies and it’s members have a common set of expectations about what defines correct behavior.
  4. Performing: The fourth stage is characterized by significant task progress being made. The group structure is fully functional and accepted and work gets done.
  5. Adjourning: For temporary teams, committees, and so on, there is an adjourning stage. Group members prepare for its disbandment. The focus is on wrapping up activities. Some members may become sad over the loss of friendships gained. Others may be upbeat, basking in the group’s accomplishments.

The Punctuated-Equilibrium Model

Temporary groups with deadlines tend to follow a pattern different from the 5-stage model outlined above. They tend to follow what is called the Punctuated-Equilibrium Model. This model is characterized by :

  1. The first meeting, which sets the group’s direction.
  2. The first phase of group activity (or inactivity) which is inertia. Often, group members haven’t really completed their assigned tasks or that the tasks were carried out in an uncoordinated way.
  3. Once the group has used up exactly half of their allotted time, a transition takes place and the group recognizes that it needs to buckle down to get the work done. This midpoint seems to work like an alarm clock, waking members up to the fact that their time is limited and that they need to get moving. By the end of this transition phase, the group drops old patterns, adopts new perspectives and sets a revised direction.
  4. After the transition phase, the group works more efficiently to carry out the tasks set in the transition phase.
  5. The group’s last meeting is characterized by a final flurry of activity to finish its work.

In summary, the Punctuated-Equilibrium model characterizes groups as going through long periods of inertia, with brief but revolutionary changes triggered by the group’s realization that they have a deadline to respect. Remember, this model is more appropriate for explaining the behavior of temporary task groups that are working under time-constrained deadlines.

Think about these stages next time you find yourself working in a group. You’ll very likely notice at least some characteristics of the Five-Stage or Punctuated-Equilibrium models.

What makes a group work well or poorly?

Why are some groups more effective than others? The answer is complex and includes many variables. It’s important to realize that groups don’t exist in isolation. They’re part of a larger organization, which has its own strategy and infrastructure. Therefore, every work group is influenced by both external and internal factors.

External Conditions

The organization’s overall strategy at any given time will have an effect on the power of the different work groups. Groups with tasks deemed as a priority will receive more resources than other groups.

The organization’s leadership, rules, resources (or lack of), and evaluation and reward systems all have an effect on group performance.

Internal Conditions

Internally, groups are affected by things like their members’ intelligence, motivation and skills. Individual abilities limit what members can do and how effectively they will perform in a group. Individuals who have crucial abilities to complete the group’s goals tend to be more involved in group activity and are more likely to become group leaders.

Interpersonal skills have been consistently found to be important for effective group performance. It is advantageous for the group to have members with conflict management, collaboration and communication skills.

A group’s structure has a major effect on the way it will perform. Leadership structure, member roles, groups composition, group cohesiveness, and group size all affect performance.

The communication patterns, decision processes, leader behavior, power dynamics and conflict interactions all affect the way groups work.

Building a Better Working Group

What can be done to improve group performance and interaction? The key is to assign appropriate tasks and give organizational support to groups.

Assigning appropriate tasks: Some tasks are more interesting to a given group than others. Harvard psychology professor Richard Hackman outlined the following conditions under which groups could be expected to work “extra hard”:

  • The group task requires members to use a variety of relatively high-level skills
  • The task has a visible outcome
  • The outcome of the group’s work has a significant impact on other people such as clients or other organization members
  • The group decides how to go about accomplishing the task and is responsible for the outcomes.
  • Work on the task generates regular an honest feedback about how the group is doing

Provide organizational support: Organizations can supporting groups in various. In the real world, the necessary resources to provide ideal levels of support aren’t always available. Nevertheless, organizations should try to:

  • Assign appropriate people to the group
  • Provide the necessary group training
  • Provide adequate and timely information
  • Give challenging yet specific performance objectives
  • Reward excellent performance
  • Direct rewards and objectives to the group rather than the individual 

Improving Teamwork

improving teamworkTeams are an essential part of the way business is being done in many companies. This is because management tries to increase organizational performance through the positive synergy coming from teams. When the tasks being done require multiple skills, judgment, and experience, teams usually outperform individuals.

In this article, we talk a bit about what work teams are as opposed to work groups, when to use them, and what characterizes effective teams. If you think your teams can do better, or if they just aren’t working well, this article is for you.

Teams vs Groups

What’s the difference between a group and a team? As mentioned in our article on improving group performance, a work group is a group that interacts mainly to share information and make decisions to help each group member perform better in his or her area of responsibility. Work groups don’t engage in collective work that requires a joint effort. This means that the overall level of performance is equal to the sum of the input.

Work teams on the other hand, benefit from positive synergy through coordinated effort. Individual efforts result in a level of performance that is greater than the sum of each individual input. In work groups the goals, performance evaluations, work style and success definition tend to be determined by the group leader. With teams, these factors are often determined by the team members.

When to use Teams vs Groups

Work groups with a single leader are best for: A challenge where time is crucial and the group leader knows best how to proceed.

Teams are more appropriate for: A complex challenge that needs to be handled by people with different skill sets working together most of the time.

Types of Teams

Teams are formed to accomplish various objectives. Common forms of teams are:

  • Problem Solving Teams: Formed usually to improve quality, efficiency and the work environment
  • Self Managed Teams: Self Managed Teams  are a step beyond Problem Solving Teams. These teams are truly autonomous. They not only solve problems, but implement solutions and assume responsibility for results as well. Managerial positions have less importance and may even be eliminated.
  • Cross Functional Teams: Are made up of employees from different work areas, who come together to accomplish a task.
  • Virtual Teams: Allow people to collaborate online using tools like video conferencing, email, instant messaging. Not surprisingly, these teams are becoming increasingly popular. Virtual Teams can be formed with members in different parts of the world in a cost efficient way.

Creating Effective Teams

Lots of effort has gone into trying to identify factors that lead to increased team effectiveness. Perhaps not surprisingly, some factors that contribute to effective group-work also apply to teams. The following are characteristics of effective teams:

Work design

Team members tend be more motivated and find the work interesting if the work design allows:

  • Team autonomy
  • The opportunity to use different skills and talents
  • The ability to complete an entire task
  • The task should have a substantial impact on others

Incorporating the above factors in the work design increases team members’ sense of ownership and responsibility over the work.

Team Composition

Size: The most effective teams tend to have more than 4 or 5 people because this allows for a greater diversity of views. The maximum effective size is usually around 10 or 12 people. More than this and it becomes more difficult for the team to get things done.

Skills: Effective teams need members with three types of skills

  1. Technical expertise
  2. Problem-solving and decision-making skills
  3. Listening, feedback, conflict resolution, and other interpersonal skills

A team can’t reach its performance potential without all three types of skills in the right mix. If you have too much of one at the expense of another, performance will suffer.

Company Resources

All work teams rely on resources outside the group to function.  Business teamwork researcher T. Kinni found that “one of the most important characteristics of an effective work group is the support the group receives from the organization”. In other words, if a team isn’t supported by the company, it probably won’t work well. Support can come in the form of technology, timely information, encouragement, and administrative assistance.

A Common Purpose

Effective teams have a common and meaningful purpose that’s broader than specific goals. It provides commitment, direction, and momentum for members. Successful teams put a lot of effort into discussing and agreeing on a purpose that belongs to them, on both a collective and individual level.

Specific Goals

As outlined in our article on motivating individuals, setting specific, challenging yet realistic goals, can help improve performance. The same applies to work teams. Difficult but attainable goals raise performance on the criteria for which they are set. So, if you want to increase quality, set goals for quality. To increase speed, set goals for speed.

Setting milestones is also helpful for teams to focus on their goal and evaluate progress along the way.

Leadership and Structure

Team members should agree on who does what and ensure that the workload is distributed evenly. The team needs to set schedules, determine how conflicts will be resolved and what skills need to be developed. Leadership can facilitate this but a formal team leader is not always required. Self-manged work teams sometimes outperform teams with formally appointed leaders. In self-managed team, members absorb the responsibilities typically assigned to managers.

Team Oriented Performance Evaluation

Getting team members to provide feedback to each other can help get team members to be both individually and jointly accountable. Evaluations shouldn’t be the only form of feedback. Team members can be encouraged to present works in progress to get constructive feedback from other team members or outsiders on the quality of work. Meeting informally and reviewing both individual and team behavior helps keep the team on track.

Team Oriented Rewards

Plaques, ceremonies, small financial rewards and celebrations of success at corporate gatherings are often used by companies to acknowledge teamwork. Unfortunately, the evidence that these team rewards make a difference is mixed. Evidence suggests that small group rewards can motivate groups if there are clear links between the group’s performance and the reward. On the other hand, team rewards may promote competition between teams, reducing information flow between them.

Confidence

Teams that have confidence in themselves are more likely to be successful than teams who don’t. Teams that have been successful believe they can and will be successful in the future. This, in turn, motivates them to work harder. Success breeds success.

A manager or leader can help build this confidence by helping the team achieve some small successes. If possible, skill training (technical and interpersonal) should be provided. This can go along way to develop team confidence.

“Good” Conflict

Conflict isn’t always a bad thing. If it is based on disagreements about task content, conflict can often be beneficial because it stimulates discussion and can lead to better team decisions. Conflict is almost always harmful if it is based on interpersonal incompatibilities, tension and animosity.

Accountability

Individuals sometimes slack-off in groups. This is because individual effort can be harder to identify. An individual might feel that they can hide in the team. To avoid this, it’s important to clearly define what members are individually responsible for and what they are jointly responsible for.

Trust

Members of high performance teams trust each other. As we know from our personal experiences, trust takes time to build and can easily be destroyed. Once destroyed, it’s hard to regain.

High performance teams (and individuals for that matter) also trust their companies. A lack of trust in an organization is usually a major problem. Not being able to count on the employer for openness, loyalty and integrity can have a major demotivating effect.

Teams aren’t always the best solution!

The benefits of using teams don’t always exceed the costs. Teams need more resources to function well than individuals. Meetings, conflicts, communication and coordination efforts can add significant costs.

HRMagazine contributors Allan Drexler and Russ Forrester, outline three tests that can be applied to help decide if it’s best to use a team:

  1. Can the work be better done by one person? This is often true for simple tasks that don’t need diverse input.
  2. Does the work create a set of goals for the group that is more than the sum of individual goals?
  3. Do members of the group depend on each other to complete their tasks? In other words, teams make sense when the success of the group depends on the success of the individual and the success of each individual depends on the success of the other individuals.

Motivating Self and Others

Motivating EmployeesAn individual’s motivation and productivity are tightly linked. Having motivated employees is important for the long-term success of almost all organizations.

Here we discuss a few important theories of motivation and what you can do to motivate others as well as yourself. If you’re not motivated to read through the theory section, scroll down to jump into how the theories can be applied.

Motivation Defined

Terence Mitchell, the author of Matching Motivational Strategies With Organizational Contexts defines motivation as the processes that account for an individual’s intensity, direction, and persistence of effort toward attaining a goal.

  • Intensity: refers to how hard a person tries
  • Direction: refers to where the effort is channeled
  • Persistence: is a measure of how long a person can maintain their effort

Theories of motivation

The main theories of motivation fall into two main classes, needs theories and process theories. A basic understanding of these theories is helpful in understanding why certain motivational techniques can be effective.

Need Theories of Motivation

Needs theories of motivation propose a similar idea. When individuals have unsatisfied needs, it results in motivation. For example, if you need money and were asked to do something (within reason), you would do it if money were the reward. Similarly, if you need to be praised, you may work harder at your job to receive recognition from your co-workers or boss.

Need theories of motivation include Maslow’s hierarchy of needs, Hertzberg’s two-factory theory as well others. We mention need theories here because some of them are well known, particularly Maslow’s theory. These theories are less supported by scientific research than are process theories of motivation.

Process Theories of Motivation

Process theories look at the broader picture of how to motivate others. Scientific evidence is largely supportive of process theories of motivation. The main process theories are expectancy theory and goal-setting theory.

Expectancy Theory – Widely Accepted

One of the most broadly accepted motivation theories is Victor Vroom’s expectancy theory. It states that a person’s tendency to act in a certain way depends on the strength of expectation that the act will be followed by a given outcome and on the attractiveness of the outcome to the person.

In other words, when evaluating whether or not to exert high effort to a task, we ask ourselves:

  • If I make the effort, can I get the job done?
  • If I get the job done, will my performance be acknowledged by those who have the power to give rewards?
  • Are the rewards attractive to me? Will the reward satisfy my goals or needs?

To date, most research is supportive of this theory.

Goal-Setting Theory

Goal setting theory, in essence, states that specific and challenging (but attainable) goals lead to higher performance. For example, as a parent, it’s better to tell your son or daughter to strive for an 80% average at school rather than simply saying “do your best.” Goals tell the employee what needs to be done and how much effort will need to be expended. Goal-setting theory is consistent with expectancy theory and can be considered a subset of it. The gist of goal-setting theory is that:

  • Specific goals increase performance
  • Difficult goals that are accepted, result in higher performance than easy goals
  • Feedback yields higher performance than does a lack of feedback

Steps to Increase Motivation

Applying motivational theories, below are steps managers can use to increase motivation:

  • Make sure employees have the necessary skills to perform assigned tasks
  • Provide training
  • Assign reasonable tasks and goals
  • Be sure to actually observe or recognize performance
  • Be sure to deliver promised rewards
  • Find out from employees what types of rewards they value
  • Be sure the rewards given are ones that are valued

Management by Objectives – MBO

A popular management technique used in organizations is called Management by Objectives or MBO. Its emphasis is on converting organizational goals into specific objectives for business units and individual employees:

Overall organizational objectives → Divisional objectives → Departmental objectives → Individual objectives

Most MBO programs have four ingredients:

  1. Specific goals
  2. Participative decision-making: Manager and employee set goals jointly and agree on how they are to be measured
  3. Specific time periods: Each objective has an explicit time period (1 month, 3 months, 6 months etc.)
  4. Performance feedback: Feedback is given to individuals on an ongoing basis so they can monitor and correct their own activities

MBO programs are implemented in many businesses but that does not mean that it always works well. MBO programs are well adapted to countries like the United States and Canada. This is because the key MBO components are well suited to North American cultures.

One Size Doesn’t Fit All

Not everyone is motivated by money or status. Some people don’t want challenging jobs. Maximizing employee motivation requires designing work schedules, benefits, compensation plans and so on, to reflect the varied needs of workers. For example, workers with families may value flexible work hours and childcare. New immigrants might prefer the option to take extended leave so that they can prolong their visits to family overseas. Some employees prefer job security over additional pay.

Providing a menu of benefit options to employees is important when attempting to motivate them. This is consistent with another theory called expectancy theory. Organizational rewards should be aligned with employee goals.

Motivating Professionals

In today’s workplace, many workers are well-trained professionals with college or university degrees. These types of workers derive a lot of satisfaction from their work and tend to be well paid. This means that money and promotions tend to be low on their priority list. Motivating this type of worker requires a different approach from motivating the typical low-skilled service worker.

Here are some guidelines to keep in mind if you’re trying to motivate professionals:

  • Provide them with challenging projects
  • Give them autonomy to follow their interests
  • Let them structure their work in ways that they find productive
  • Reward them with educational opportunities such as training, workshops and conferences – opportunities that let them keep up with their field
  • Reward them with recognition
  • Demonstrate to them that you’re sincerely interested in what they’re doing

Sure-fire Ways to Demotivate People – 3 Don’ts

For most employees, motivation is influenced by relative rewards as well as absolute rewards. This means that individuals compare their effort and rewards with those of others. Based on this, we can identify practices that tend to demotivate employees. Below we list some “don’ts”.

  • If two employees do the same work, don’t pay them different salaries. Especially if there’s a fair chance they’ll find out about the difference.
  • For two workers with the same job and different levels of seniority, don’t compensate workers with less seniority more than workers with more seniority.
  • Don’t compensate your workers significantly less than workers in nearby companies who do similar work.

Can We Simply Eliminate Rewards?

Some experts say you can use theories (goal-setting theory, expectancy theory) to help motivate individuals. However, some argue that  it is a mistake to talk about motivating other people. Scholar Afle Kohn, author of Punished by Rewards, argues that “the desire to do something, much less do it well, simply cannot be imposed. All we can do is set up certain conditions that will maximize the probability of their developing an interest in what they are doing and remove the conditions that function as constraints.”

There are countless examples of people working tirelessly for long hours on volunteer activities that yield no external rewards. People will work hard if the job captures their imagination and passion. They require less supervision and put in more effort and devotion than they would if they were waiting to be rewarded every step of the way.

Based on Kohn’s research, he proposes alternative ways organizations can create a motivating environment:

  • Abolish Incentives: Pay people fairly and make sure they don’t feel exploited so that pay is not on their minds. This way, they will be more able to focus on goals.
  • Re-evaluate how employees are evaluated: Performance evaluation should be more of a continuous two-way discussion to exchange ideas and questions. The discussion shouldn’t be tied to compensation, nor should it be about who gets raises and promotions.
  • Create conditions for authentic motivation: Changing the way employees are treated often increases productivity more than changing the way they are paid. Help employees rather then surveilling employees, help them by listening to their concerns and thinking about problems from their perspective. Provide plenty of feedback so they know what they’ve done right and how they can improve.
  • Collaboration: People perform better in well-functioning teams where they can get feedback and learn from each other. Provide support to create well-functioning groups.
  • Content: People are usually the most motivated when they can learn new skills on the job, have a variety of different tasks and are able to demonstrate competence.
  • Choice: Some jobs (such as garbage collecting) are intrinsically uninteresting. For these jobs it may be difficult to provide variety and opportunities to learn new skills. For all jobs and especially the mundane ones, employees should be given as much choice as possible in how the task is completed. This does not mean you should forgo management, rather, involve people in the decisions to be made.

Summary Guidelines

We’ve condensed a lot of ideas in this article. From this, we can list a few simplified guidelines that summarize the essence of what we know about motivating people in organizations.

  1. Recognize individual differences. Employees have different needs and should not be treated the same way.
  2. Use goals and feedback. Employees should have specific goals and get feedback about how well they are doing.
  3. Allow employees to participate in the decisions that affect them. These decisions include setting work goals, choosing benefits packages, as well as how to solve productivity and quality problems.
  4. Rewards given should reward desired performance. Rewards should be linked to the type of performance expected and employees must see a clear linkage.
  5. Make sure the reward system is perceived as fair.

Protect Yourself From Internet Fraud

Protect from cyber attacksInternet scammers will always be out there looking to profit off of unsuspecting victims. Here, we take a look at a few of the most common threats.

Phishing

Phishing is a tactic criminals use to collect personal, financial and and other sensitive information by using mails, text messages and websites designed to look like they come from well-known and trusted businesses, banks and government agencies. As an example of a typical phishing scam, you receive an official looking email from a bank, complete with a copy of the bank logo and the bank’s “look and feel”. The email might ask the you to follow a link to update or verify your banking information. If you click the link you’re sent to a website that looks cosmetically exactly like their bank’s real website. You’re then asked for information such as your username and password, social insurance number, full name, date of birth, full address, mother’s maiden name and so on.

Phishing criminals can then use your personal information to:

  • Access your financial accounts
  • Transfer funds
  • Apply for credit cards
  • Make purchases
  • Access your personal email account
  • Hide criminal activities

Be wary of any messages you receive requesting personal or financial information. Check your bank and credit card statements regularly to make sure all transactions are legitimate.

Pharming

Pharming is similar to phishing in that both scams try to fool you into supplying fake websites with sensitive information. Pharming scams are more sophisticated because they don’t require an email or other message to “bait” you into visiting a site. Instead, the scammer compromises your system with malicious software that redirects your web browser to a fake website, even if you type in a legitimate website address directly into your web browser.

To protect yourself against pharming scams, check the certificate of the website you’re visiting. Make sure the name of the certificate matches the site you’re visiting. To do this, click on the small lock icon next to the website address in your browser. Additionally, ensure that you have good anti-malware software tools installed on your system, especially if you’re running Windows as your operating system.

Pharming scams are currently less common than phishing scams but this is likely to change as criminals become more sophisticated and embrace new techniques.

Hacking

Hackers find and exploit weaknesses in computers or computer networks. Malicious hackers break into networks to steal information, destroy data or bring down the network rendering it unusable.

To help protect from hackers:

  • Use anti-malware software
  • Don’t run unknown programs you receive in emails or download from the internet
  • Use a network firewall
  • Don’t leave your computer on when you’re not using it

For more in depth information, refer to our article on securing your computers and network.

Know That You’re at Risk!

Many small business owners are familiar with different security threats such as keystroke logging, targeted attacks, and risks that come with using smart phones for company business. Most acknowledge that such attacks where company information is stolen can be very damaging to a businesses.

Yet, most of these business owners don’t feel that they are at risk. The rationale being that cyber-attackers will spend their efforts on larger businesses where the stakes are higher. That’s a dangerous assumption. A data breach could mean financial ruin for a small business.

What you can do:

  1. Educate employees about Internet safety. Write up and circulate security guidelines and internet safety practices. Have passwords changed regularly and protect mobile devices.
  2. Assess your current security status and safeguard company data, know what you need to protect. Understanding your risks and security is important so that you can take steps to protect your information.
  3. Take proactive action and develop a security plan. Your plan should cover password policies, email and web security as well as encryption.

Recommended Free Desktop Software

free software alternativesMany businesses and individuals needlessly spend a lot of money on desktop software. There are many free software alternatives out there that perform as well, or even better, than their non-free alternatives. It’s worthwhile exploring free software options as a way to save cash.

It’s possible that you’ve never heard of the free software alternatives listed below. One reason is that creators of free software usually don’t have the marketing budgets of the Microsofts and Adobes of the world. This doesn’t mean that free software is not functional or less safe than proprietary alternatives. Free software is often safer, especially when it’s open source, because anyone can see the code. More eyeballs on the code means vulnerabilities can be found and fixed more quickly. 


Office Productivity

LibreOffice

LibreOffice includes a word processor, spreadsheet, presentation, database and more. It’s free, yet similar in functionality to Microsoft Office. LibreOffice lets you edit and create documents in Microsoft’s formats (.doc, .xls, .ppt etc). Don’t shell out the cash for Microsoft Office licenses unless you’ve evaluated LibreOffice as a free alternative.

Scribus

If you need desktop publishing software (DTP), take a look at Scribus. It has a lot of features which means you might not need to pay for a program like Adobe InDesign or Microsoft Publisher.


Graphics & Photo Editing

GIMP

GIMP (GNU Image Manipulation Program) is a graphics editing program to edit and create a wide variety of images, icons, web-page graphics and more. It contains all the features most users need without having to resort to the pricy Adobe Photoshop alternative. While some companies, like professional photography studios, might need the features Photoshop provides, it doesn’t hurt to take a look at GIMP.

Inkscape

If you’re looking for a vector graphics editor, with capabilities similar to Illustrator, CorelDraw, or Xara X, take a look at Inkscape. It’s also free and open source. As described on the Inkscape website: “Inkscape supports many advanced SVG features (markers, clones, alpha blending, etc.) and great care is taken in designing a streamlined interface. It is very easy to edit nodes, perform complex path operations, trace bitmaps and much more.”


Email & Calendar

Thunderbird & Lightening

As an alternative to Microsoft Outlook, check out the free Mozilla Thunderbird mail client with the Lightening calendar addon.


Web Browser

Firefox, Chrome & Opera

While Microsoft Internet Explorer comes bundled with Windows, it really isn’t the safest choice for web browsing. In addition, it tends to lag behind in terms of compatibility with web standards and features. We recommend Firefox, Chrome/Chromium and Opera.


Programming/Development

Eclipse

Eclipse is our overall pick for a variety of programming languages. It’s a feature rich, integrated development environment. You can use Eclipse to develop Java applications with plugins to code in C, C++, Perl, PHP, Python as well as many other languages.

Kompozer, Bluefish, & Aptana Studio

If you’re mainly interested in web development, you might prefer a lighter application. Our favorite free web editors are Kompozer, Bluefish and Aptana Studio.


Operating System

Linux

Microsoft Windows is currently the most common desktop operating system. It is also the most insecure and vulnerable operating system when compared to Mac OS and Linux. A free and safer alternative would be to use one of a variety of Linux desktop distributions. Linux desktops come in a variety of “flavours”, allowing it to target a wide variety of audiences. Many Linux distributions are extremely user-friendly, and often easier to use and install than MS Windows.

Our favorite desktop Linux options are:

It’s important to note that there will be a learning curve when switching from Windows to Linux, but the curve is no bigger than if you were to switch from Windows to Mac OS. If the Windows software you rely on has Linux alternatives, you should consider Linux as an alternative operating system for at least some of your desktops. The desktop software alternatives listed above have versions for Linux, Mac OS as well as Windows.


Where to Find More Free Software Alternatives

There are many thousands of free software packages out there. Many can be searched for and downloaded from sourceforge.net. SourceForge boasts over 3 million developers involved in over 300,000 free software projects. On SourceForge you can search for software by keyword or category, and view popularity, user ratings, and recommendations.

Is It Worth Switching?

Adapting to new software does carry costs. The question is, do the long-term financial savings gained from free software justify the short-term switching costs? The answer is sometimes yes, and sometimes no. Let’s use an example. If you have a MS Excel power user on hand whose productivity would be stifled by switching to the LibreOffice Calc alternative, then it’s best to pay for an Excel license. The added productivity will make up for the cost of the license. If the user is new to spreadsheets or is more or less indifferent, then LibreOffice Calc is a good choice.


Is your favorite free program not listed here? Let us know about it!