Saturday, December 15, 2007

Protect Your Income From Globalization

By Sean Anderson

Economic globalization is occurring rapidly. Countries in Eastern Europe, South America, Asia, and Africa are undergoing rapid economic development. Growth in these geographic regions is expected. Why wouldn't companies seek out the lowest cost centers? Low cost centers exist just hours away from countries like Germany in places like The Czech Republic and Estonia. Why pay fifteen Euros an hour in Germany when employees accept two Euros per hour right down the road? These companies are even growing with the charitable help of the "West". If you want you can get online and make an interest free loan to somebody who may replace you in the next five years.

Globalization can be seen everywhere. Even in traditionally well protected service sector jobs like IT and Accounting. A lot of IT jobs have already slipped into the clutches of countries like India and the Philippines.

What does this mean?

The service sector jobs are going to become increasingly less skilled, and the skilled service sector jobs will become outsourced. College diploma's will start looking bleaker all the time. They will hang on the wall they as a reminder of your Note Payable from student loans, not the promise of a prosperous job. The reason is that technology and globalization are breaking down educational, cultural, social, political and economic barriers. The problem is not that the barriers are being torn down, this was inevitable. The problem is the rate with which it is happening. The people in prosperous countries will not have time to make adjustments.

Fifteen years ago people didn't have Indian IT personnel, fresh coffee beans from South America, and handcrafted masks from Africa. Now people even have entire rooms dedicated to an Asian or European theme. It is great to have this type of diversity in the home, but this diversity has saturated our culture in a short fifteen years. Imagine the effect when this shift of goods becomes a shift of wealth. The top tier in the world will suddenly be asked to live a more conservative lifestyle. The result will be instability in economic markets, and shifts of power.

In a rapidly evolving and globalizing world it is important for nations to have a population that is rapidly adapting. The super power nation of today will fall by the wayside if their people cannot adapt to these changes. It sounds dramatic, but it is not naive to expect nations in similar standing as the United States to see an overthrow of government. Failure and prosperity are both on the horizon for every country despite it's current economic standing.

Currently the U.S. stands to lose the most. This can be seen in the weakening dollar (Canada's dollar is now more valuable than the U.S. dollar), the export of white collar jobs, the growth of low paying service sector jobs and in many other aspects of American life.

The future survivors will have either moved to other countries to exploit the difference in the standard of living and maintain a job or will use the internet to protect themselves from the sliding prosperity currently held. The internet is the one median transcending borders and culture. Prosperity here can be achieved everywhere. Those who master the internet master the global economy won't have to worry about. They will use a global tool not a global location to determine success. Don't view globalization as an enemy close, embrace technology and get ahead of the shift.

Business to Business - Acquisitions the Four Deadly Traps

Acquisitions are meant to bring out the strengths of companies in similar fields or to build value in the supply chain. So, why do they so often fail to achieve this goal? Often time these failures occur due to business culture, overly conflicting attitudes, solution management and failure to take advantage of core competencies. All of these are intertwined in some way or another but they are the principle failures and death traps for companies that have acquired their competitor, supplier or distributor.

The core attitude of almost every acquiring company is "We have been doing specific tasks or following specific business strategies forever.  We acquired your company and you are going to have to make the changes we want". The logic here is rarely beneficial for the newly joined companies. What occurs here is that the acquiring company's business culture overpowers the acquired company's culture and key resources are lost. The attitudes that lead to cooperation are not being developed.

Business must evolve when acquisitions are made. The appropriate adaptations must be made by both companies in order for the new relationship to work. Often times employees hear speeches about these very topics but no one takes ownership to make sure the proper adaptations are made. Have the CEO make the speech and immediately follow the speech with ten noticeable changes.  The first changes should provide some relief to employees.  Look for things that employees dislike about the current conditions.  If these are tasks ask if they even need to be performed and provide direction to new more fulfilling and value added activities.  Software systems are a great place to to challenge next, they probably needed updated and can further improve efficiency. Then managers need to drive the transformation to the team. By constantly encouraging new ideas and cooperation. This brings out the best in both companies. Especially, considering that a lot of employees are worried about their job security and often rightfully so. This successfully prevents the bully effect and takes peoples minds of the uncertainty of the new environment.

The next demotivator occurring during acquisitions are conflicting attitudes. This is most noticeable when one company acquires a former competitor. For some reason people try to switch to an antiquated method of performing their job duties and resist change with every fiber in their body. For instance, one lady I worked with during an acquisition started stuffing payroll and A/P checks into envelops by hand.  The other automated the process with a machine that printed out laser checks and stuffed it directly into an envelop. The hand stuffing took a day and a half. The automated process took about thirty minutes.  I am not sure about the thought process but people take to change in odd unpredictable ways.  Depending on the employees level of skill they decide whether or not the position can be eliminated. In the case of the checks it is obvious the attitude can be eliminated by terminating the obstinate employee but it is better to prevent this type of behavior through team building.

What if the problem is with employees who are preparing the reporting package? These employees have high level skill sets.  For instance, an acquisition company had a reporting package that clearly could not handle the inter-company consolidations but still forced the use of an inadequate reporting package.  The holding company was looking to up its game by buying a large company but they relied on a reporting package meant for the smaller businesses typical of their portfolio. The manual processes of the reporting package were unmanageable and this caused high turnover. It is sad that the reporting package could have been automated with existing system the acquired company used. Due to the turnover process key employees had been lost and fires began sprouting up everywhere.  This in turn made it hard to keep new talent being brought in.  When upper-management of the acquiring company tried to force a solution they created problems with the largest company in their portfolio. They took the attitude that their needs were more important than addressing the stress of their biggest reporting company.  It took a while for them to realize the scope of their request was unmanageable given their current reporting package.  Note that this also caused accounting systems to fail and for the reported information to be less and less reliable.  All of these issues could have been avoided by addressing and listening to the concerns of the highly skilled knowledgeable employees.

The key to recognizing areas where conflict is not necessary is to simply step back and ask are both sides presenting a view that makes sense. Too often, managers get caught up with resolving menial tasks and the don't pay attention to the substance behind issues causing conflict.

The third problem is solution management. Prioritizing problems is a must. Sometimes quick solutions must be implemented, but this tactic should be the exception not the rule. If companies don't address the core problems first the problem will arise repeatedly.   Problems should be addressed at the source. All to often some managers notice a mistake corrects the mistake and moves on without questioning what caused the mistake.  Worse managers may implement a process to catch mistakes.   Focus on fixing the front end and then smoothing out the errors on the back-end. Far too often newly merged companies create a muddled mess by addressing the error and not the process.  Even if something has to fall by the wayside address the process not the issue. To put it simply don't sweep the floor before cleaning off the counters.  You will just have to sweep the floor again.

Finally, analyze the core competencies of each business and take a look at how the core competencies of one business can be integrated with the other. Focus on bright spots that can be spread throughout the business model. If the core competencies of each company are successfully integrated a strong unified front appears in the market. If in-fighting occurs the weakness will spread like a virus and a cure will be hard sought.

For acquisitions to be successful implement an attitude receptive of change, resolve counterproductive conflict, address problems from the core and take full advantage of core competencies. Avoid the four death traps that doom acquisitions and the business relationship will thrive.

Refinancing Through Foreclosure

By Sean C Anderson

Times have been tough. A lot of people are losing their homes to foreclosure. You can be eaten by the wolves or join the pack. Creative people often find opportunity in despair. Right now you probably have a job, decent credit score, and some equity built up in your home. My suggestion would be to sell your home and take a loss if necessary and to turn that loss into a gain by buying a foreclosed home.

Anyone can see that they can take a 20% hit if they can buy a home of similar value at 50% of market value. It takes a lot of research but if your home is foreclosed on you'll find yourself in the same bind with less room to maneuver. Besides with planning you don't have to take a loss. This all depends upon the immediacy with

Eliminate some of the risk by doing research. Often you can find foreclosed homes on the internet. If you have a couple weeks vacation spend it house hunting, and following up on leads. You can often find a house in the area you live that will still afford you the same standard of living and allow your children to go to the same schools. Get an idea of the places you can go to find foreclosed homes and familiarize yourself with the process of purchasing these homes. While your doing this put your house up on the market and set a high price. Right now you don't have to be in a hurry to sell and you can ask for a better price. If someone buys your house and you can earn some money great. Take the family to your parents for a little bit, find a short-term apartment or stay in a hotel if needed. It shouldn't take you long to find a new house if you have been aggresively seeking deal, as a matter of fact you should try to have a few home targeted for purchase.

If you have familiarized yourself with foreclosure properties you should be able to find a home fast. More often than not you will be able to find a better deal, have lower mortgage payments and increase your equity in the new property all by simply staying ahead of the game. Be careful though, remember it is always possible to lose money. Get the home inspected, follow through with escrow and get insurance. There is nothing worse than losing money through repairs, a faulty title or causes you could have taken precautions against.

Even if you are not a real estate investor you should be able to devote the time to better secure your families future and your financial standing. Inaction leaves you in a risky situation, taking action allows you to control the risk. By dedicating yourself to the process of change, becoming educated and taking action you can build wealth even in desperate times. Always buy foreclosed the best refinancing is a great home purchase.

Find foreclosures by following the provided link Refinancing Foreclosure