I had an interesting conversation about my view that management control over employees is a myth. I have believed for some time now that an office is often a total waste of money and completely unnecessary. Most of the time I’m told it’s OK when you work by yourself, but not if you have employees, as they need to be supervised and somehow “controlled”.

I have now been working for almost ten years from home, and most of my staff works from home too. Apart from being an eco-friendly way to work, it saves people time and frustration to travel in and around London to come to an office, where we all sit in cubicles or offices. In the days of broadband internet, Skype and OnlineOffice, there is no need for an office, even to have meetings.

Offices, like cars are are often nothing else but status symbols - what other reason can there be for a small business to have an office? If that is true then how is the office helping with your business, it’s a big expense. Seriously, if you do not have clients coming thru your office doors several times every day, why have the office. Even if you have, do really all your people need to be in the office every day? I guess not!

We are in an economic downturn, what is more important - your ego or your business - ask yourself that every time you walk into your office. I’m sure there a good reasons for some micro businesses to have offices, even so I currently can’t think of any, but I’m convinced in most cases a healthy bootstrapping and outsourcing mentality would be more beneficial for your business.

Unless the first business goal is to feed your egomania, you need to have a good hard look at your cost structure to survive in these times. — ST.

When my wife went to university in London in the eighties one of her professors was of the opinion that the education was wasted on women, since they would leave university, get married and have children. While nobody says these things anymore in public, we still seem to have the same mentality.

Today I travel around the world and speak with all kinds of people about micro-business, like home-business. Often the conversation includes the so called “skill shortage”, felt especially hard in Australia these days. When I question this alleged shortage, I’m always surprised about how little consideration is given to well skilled and educated parents - mainly women - sitting at home looking after the family.

After one of these conversations today, I was reminded of this professor and began wondering if he was right with his opinion in the final analysis? Trivially, his assertion that educating women is a waste, is completely nonsensical, but the final result to the economy seems to suggest his analysis could be right. How else can it be explained that we ignore this massive “skills resource” sitting at home.

The technology we at WinWeb have developed allows for work from anywhere at anytime, others have done the same in other areas? Where is this “skill shortage”? The truth in my opinion is more the fact that we often block this remote working possibility from our minds, but why?

If you consider the skills potential of parents, if each parent would only contribute one hour on average per week to their learned professions. This would be a staggering number of man hours per week.

The benefits for the home working parent would be very tangible too. They could show a almost uninterrupted work history, stay in touch with their profession and would therefor find it much easier to get back into full-time employment after the kids have grown up.

To often my conversation partners look somewhat bewildered at my initial suggestion, but then often admit they had never thought about this possibility.

It is not a waste to educate women or any parent, it is however a waste to treat parents as if they do not exist in work terms. I consider it an insult to each parent and unbelievably damaging for our economy. — ST.

More and more of the work-force in large corporations work from home, or have a “hot-desk”, they share with others while they are in the office. This trend is driven by the ever present need to feed the profit hungry shareholders of these often public companies. But is this trend only some thing big business should consider, or has teleworking a place in the small business?

If it is then what would the advantages are for micro business to allow teleworking for it’s small work-force? Here are some reasons why you may consider to allow your staff to work from home or on the road, with only a temp-desk in your office:

• Efficiency - you may come to the conclusion that your staff member does not need to be in the office to do their work, bookkeeping staff for instance, customer care staff can also work from home. They would save the trip into the office, saving time and money while reducing carbon footprint.
• Cost-effective - consider how much office space you could save, with that money on rent, furniture, heating and electricity, again reducing carbon emissions.
• Recession-proofing - having lower over-heads/fixed costs during times of an economic slowdown helps your small business to survive.
• Growth of Business - you could stay longer in the same property while your business is growing, with the same above effects, plus savings on time, money by not having to move. No to mention the business interruption before, during and after the move.
• Lean & Mean - is not only something that big business needs to worry about, if they could they would run the whole Microsoft, GE, Barclays empires with ten people, in order to boost profits. Ultimately that is why you run your small business too.
• Enabling disabled workers - this point is often overlooked. We are concerned with not having a educated workforce, while highly educated but disabled people sit hat home without adequate work, that seems a waste to me.

I think it is sometimes important to remember how good it feels to get up in the morning and go to your small business without any real financial worries. Unfortunately this is not the reality for many self-employed, sole-traders and other micro businesses, that is a shame. Making decisions about how and where your work-force works is part of that process that will get you there in the end.

After working from home full-time now for over nine years, only going to the office for meetings has not only be a financial success but also liberating. — ST.

Resources:

• OnlineOffice - run your office, staff and business from anywhere.
• Business Link - one of the best guides I’ve seen.

I think I have written at length about customer service and how important it is to the success of your small business. Customer service has also to do with knowledge about your products and services, personal development and training is essential to reach this goal.

However, if you think that training is costly, think again. I have compiled some low cost training options for you:

✓ Suppliers - they often run in-house training programs, it is good for them too;
✓ DIY-Training - run in-house training yourself, do case studies;
✓ Experts - if you employ in-house experts, use them for training others too;
✓ Product Testing - get free test product and have hands-on time for your staff;
✓ Literature - start a library for your firm and give staff time to read;
✓ Internet - encourage the use of the Internet to find information;
✓ Volunteer - get staff to volunteer for charity, school or other work, it’s very educational;
✓ Training Grants - often grants are available for training, get informed.

With good customer care and product proficiency your business will convert more customer enquiries into revenue generating business. Training will motivate your staff and help you to be a pro-active and up-to-date supplier for your clients. ST.

When hiring people, what are you looking for? Knowledge about your industry, high IQ, many years experience? All these personal traits are important, but not as important as EQ - emotional intelligence - which means people who have natural warmth, are optimistic and can empathize with the plight of other people.

Who would you rather deal with, someone who seems cold and distant, or someone who understands your problems and can suggest solutions or ideas on a services/product level, but also on a more emotional and beneficial level. It is with everything else in life, we like dealing with friendly and warm people.

So when you hire, ask about faults, ask about being told off for getting something wrong, ask how they felt when someone else got told off at work? Listen to their answers, if they have no faults, if they never make mistakes, or think others are just not good enough, than they are obviously perfect.

Never hire perfect people, they are deeply flawed or inhuman, and nobody will want to deal with them, including you! ST.

Well, two things come to mind:

Often the term “staff turnover” is used in connection with fluctuation in staff levels, which means staff leaves the company - for whichever reason. How large or small staff turnover in a company typically is I do not know, but large staff fluctuations are not good for any business. It usually indicates problems during the hiring process or management problems within the company.

The other use of the term “staff turnover” could be in relation to the monetary turnover for a business a staff member will generate, versus the turnover generated by the business owner. This is assuming this staff member is employed in a sales capacity. Here it would be desirable to have a large turnover, of cause.

In both cases it is true to say, it does not matter what kind of small business and start-up business, like SOHO-, SME, SMB-, Micro-, Lifestyle-, Home-, DIY-, Hobby-, Boomer- or Personal business, like professional, contractors, freelancer, self-employed, sole-trader and virtual assistants, you run. It may be more related to things like:

• Market segment;
• Management environment;
• Staff experience, to name but a few.

You can always speak with some other small business owners or get some market segment data from information agencies, maybe they can give you a better idea of where you should be with numbers, comparing yourself to your peers is always a good idea.

I like the question, it makes for some interesting planning exercises for bootstrappers. ST.

Disclaimer: As with any of my readers questions, I do not have all the answers and here on my blog I can only give you some ideas, since I know very little about your small business. If any of you can add anything here do so for the benefit of my reader, who asked the question and everybody else, leave a comment below - I’d be most grateful.

I’m answering three questions here, emailed to me during last week, so excuse the long headline. I will give examples and will let you fill in the rest for yourself.

What are “Fixed Costs”?

Fixed costs are operating cost that are incurred when providing necessities for doing business and have no relation to the volume of production and sales. Examples are rent, some employee costs, property taxes, telephone, heating and interest/bank expense.

As opposed to “Variable Costs“, they only occur in proportion to activity within the business and hopefully that will lead to sales and revenue.

Why should I keep my “Fixed Costs” as low as possible?

When I talk about outsourcing, I’m talking about changing fixed cost into variable cost. Let me give you an obvious example to make my point.

Let us assume you have hired someone to answer the telephone, this person cost you $1,000 per month, and on average you get about 5 calls per day. Most of these calls are not even from clients, or you could take the calls while you are in the office. This $1,000 is a fixed cost, no matter how many calls you get, or if you are in the office or not.

So you outsource it to a virtual assistant, now you pay $100 per month and that includes 50 calls received, each extra call is $1 per call. The $100 are still fixed cost, but you have lowered your monthly fixed outgoings by $900. And depending how often you are in or out of your office, the 50 inclusive calls are probably enough to cover your needs. Combine this with online technology and you can stay in touch anywhere and anytime.

Should that not be the case, then you have “variable costs” of $1 per call, which means you are out of the office, working or enjoying life while it is quiet, for example during holiday season. You phone is professionally looked after in any case.

Outsourcing, bootstrapping (cutting costs), it all means the same for any small business and start-up business, like SOHO-, SME, SMB-, Micro-, Lifestyle-, Home-, DIY-, Hobby-, Boomer- or Personal business, like professional, contractors, freelancer, self-employed, sole-trader and virtual assistants, more money for you, less distractions, and a more recession proof small business, that is why business planning is so important.

Answer: Keep your “Fixed Costs” down. Stay mean and lean, while enjoying your work and life. ST.

Disclaimer: As with any of my readers questions, I do not have all the answers and here on my blog I can only give you some ideas, since I know very little about your small business. If any of you can add anything here do so for the benefit of my reader, who asked the question and everybody else, leave a comment below - I’d be most grateful.

Any small business and start-up business, like SOHO-, SME, SMB-, Micro-, Lifestyle-, Home-, DIY-, Hobby-, Boomer- or Personal business, like professional, contractors, freelancer, self-employed, sole-trader and virtual assistants, at some point will have to think about hiring staff. I received this question yesterday from one of my readers, and in my mind to answer this question you have to look at two areas:

Firstly, the obligation your small business has towards your staff.

Your business has an obligation to your staff, that extents far beyond paying a monthly salary, insurance and taxes - you have a social obligation. Offering work to someone means offering them security of employment, which in turn secures their private lives, mortgage, education for children, and so on. So you should only take on staff, if you really can fulfill all those criteria. If you can’t - outsource.

Another point to consider, is if you have enough work for the new staff member in this position. Staff is not impressed if they get hired to answer the telephone, and then have to clean the floor.

Secondly, finding the right staff.

This is probably easier than you think - as a bootstrapper at least - if you only hire staff, core to your small business, i.e. they need a skill set you can judge easily, because of your own skill set, then you will have a much higher success rate with hiring staff.

If however you hire staff for areas outside your skill-set, and for non-core functions for your small business, it becomes much harder, and your success rate will go down. Here I do and always would outsource, it makes it easy to change or end the relationship, makes you look more professional and reduces the fixed cost structure in your small business.

There are other points to consider, but this is my two pennies worth. ST.

Disclaimer: As with any of my readers questions, I do not have all the answers and here on my blog I can only give you some ideas, since I know very little about your small business. If any of you can add anything here do so for the benefit of my reader, who asked the question and everybody else, leave a comment below - I’d be most grateful.

I get regular questions about what we really mean by WinWeb’s Small Business Infrastructure?

On-demand Small Business Infrastructure™ centers around the idea that business start-ups and growing small businesses need help with numerous administrative tasks that are not core to the business success - such as bookkeeping, it services, internet services, call handling and other such services.

These services - if performed by the business owner - cause a great deal of time wasting - while the fixed cost of a business is still accumulating. This is in our minds a fatally floored business model and can easily be remedied with our infrastructure approach.

We should not expect business start-ups and small business in general to be accountants, bookkeepers, lawyers, marketing & PR gurus and so on. We should provide small business with an infrastructure in which it can concentrate on core business tasks, while at the same time enabling the business owner to stay informed of all relevant business facts like cash flow, sales, HR issues, tax position and more. This will enable him / her to make informed decisions, maybe with the help of an external advisor.

Based on these facts, we have devised a six point on-demand Small Business Infrastructure™ concept, which consist of:

1. WinWeb On-Demand Software Solutions - Anywhere At Anytime.

AccountsOffice and OnlineOffice are our two software offerings, which are based on the SaaS - Software as a Services model, to allow for the following key business benefits:

• tight inclusion of business advisors from the start,
• cultivating outsourcing techniques at the outset, i.e. virtual assistants,
• no IT knowledge needed and hassle free operation,
• real-time multi-user access from anywhere, increasing mobility.

2. WinWeb 24/7 Live Support - We Are Here For You Always.

Providing customer care and support only during business hours is not acceptable to our clients. Experience has shown us that most admin work gets done by small business before nine in the morning or after five in the evening. This practice is essential if the business is to survive it’s early years.

This is why we have provided our much acclaimed customer support for 24 hours a day, seven days a week from the outset. Saving our clients wasted time and money - while setting new standards in customer support. No manuals need to be read - all problems can be solved in real-time online.

3. WinWeb Live - Networking Community for Small Business Only.

To foster collaboration and outsourcing we have expanded our WinWeb Live™ offering to allow for small business community networking - thus enabling the business owner to make decisions about his / her current needs, with the following benefits:

• timeshare virtual assistants for professional results,
• offer contracts of work to contractors on a case-by-case basis,
• promote the business to a large audience or even locally,
• find new work and contracts online

4. Business Advice

Our On-Demand Small Business Infrastructure™ enables business advisors, accountants, bookkeepers and other advisors to have a “Up Close and Personal” relationship with the small business owner, providing key elements for the success of a small business:

• timely and up-to-date advice from anywhere at anytime,
• more efficient advisor function due to SaaS technology, less travel,
• easily expandable advisor network.

5. Solution Partners

Third parties provide external services to complement our services, such as parcel service, office supply services, printing services. These and other services are provided on a bulk buy arrangements by leading businesses in their respective sectors - to provide the most reliable and up-to date service possible - with the effect of enhancing the professional appearance of our clients.

6. ClimateByte™ Technology - For A Cleaner Future.

Our clients are among the biggest demographics concerned with climate change and carbon footprint neutrality. It is a fact that employing remote working and collaboration techniques drastically reduces the damaging business side affects on our environment. We enable our clients to be more eco-friendly and aware, by providing them with our green technology - an ongoing development commitment of WinWeb.

WinWeb welcomes any suggestion that will further enhance our On-Demand Small Business Infrastructure™ concept - especially the development of even more eco-friendly business processes - to serve our small business and business start-up client-base.

The typical scenario is you work hard all week, have no live and at the end of it all little money to show for it. This is often a sure sign of loss of management control in a small business and start-up business, like SOHO-, SME, SMB-, Micro-, Lifestyle-, Home-, DIY-, Hobby-, Boomer-, Professional-, Personal businesses.

The small business health-check questions for this episode are:

• Do I know what is going on in my business in all areas or have I abdicated some responsibility to staff? You can pick and choose what you do work-wise everyday, you can not pick and choose what you should know about and make decisions about - this is your business, not your staffs business - act like it.
• Am I running my business or is it running “itself”? No business is running itself, other than into the ground!
• Do you know how your cash-flow is doing? Done this one before, yet it always comes back to this, check it out.
• Do you have an overview of your small business fixed costs and sales, are you happy with the situation? I guess you could always do better, but if you do not know the details you can not improve your situation.
• Is your vision in line with your small business targets? You need a vision for your business, that will allow you to develop your small business strategy and plan, so you know where you are going - don’t just drift along.
• Have you asked your staff lately? Have a power-meeting with your staff once a week, to see how they are feeling about your small business, last week or the next few weeks. It will motivate them and give you a new insight in how others see your small business.

The central message here is to be involved in ALL areas of your business ALL of the time - in a management capacity. When I hire people I always hire people who do something better than I, but you have to stay involved.

You can see other reasons for small business and personal business, like contractors, freelancer, self-employed, sole-trader and virtual assistants failures in my Health Check Category, if you can add to this list please do so, I would welcome your comments.