The Value of Work is Inextricably Linked to its Impact

(This is the first installment in a series of articles about the problems associated with government's attempts to ignore free market principles in a free market world ecomony.)

There is no free lunch.

It seems an obvious foundational principle to all things business - at least all things business in our capitalist system. Somehow, somewhere along the line, we seem to have forgotten.

We have started to believe, even in business, that we are entitled to something, simply because we are. We live and act and conduct our enterprises as though we are entitled to remain profitable on the basis of our existence, our history, the size of our assets, or the supposed quality of our product. Employees think that they should continue to be paid just because they show up, and do some work. It doesn't work that way, and it never should have.

Can you say that any job/activity has quantifiable, intrinsic value?

I once heard Hillary promise to use government programs to guarantee jobs to the manufacturing workers in the northeast. I once heard Obama say that he will do the same to restore the jobs of auto workers. They speak as though they believe that any and all workers should be entitled to be paid whatever they need, doing whatever they can, without considering the real value of their work for the company or the customers they work to serve. These people act like one can dictate prices and wages, without regard for the associated value of the products or the service provided. They are deceived.

Anyone believing that there is intrinsic, quantifiable, fixed or naturally escalating value in performing the tasks themselves is equally deceived.

What Determines the Value of Work?

What dictates the value of the work done by an auto worker, or anyone, for that matter? What guarantees him or her a position by which wages can be justly deserved?

Only the value of the contribution the position makes to the product or service produced, and the customer who buys it.

When that contribution does not exceed the value available, recognized, delivered, received, and desired by customers, that work is no longer worth doing. The worker can no longer expect to continue to be paid for his services. The work is no longer valuable, or necessary.

At one time, thousands of people were gainfully employed as elevator operators. The landscape changed, and elevators became automated. Attempting to maintain that the elevator operators of the world should continue to be paid for operating elevators would be pure foolishness.

Why are there no more people employed as elevator operators? That service is unnecessary.

Attempting to maintain that any job should be preserved, "just because so many people do it" is equally foolish. It is nothing short of a "free lunch."

The same principle is at work in every industry, in every healthy economy.

This same mentality will produce disastrous, protectionist policies to be imposed on a world economy. They won't work. They can't work. They never have worked in a free market economy. And, no matter what we may try to tell ourselves, the world economy is a free market, even capital based, economy.

Somebody will pay, even for a "free lunch." And whatever the cost, it exceeds the value received. It is a bad deal.

Beware of Business HIV: It's On the Rise

The less you pay, the better the deal. Right? The less time you spend, the more money you save. Right? These precepts are the foundation of a creeping business virus I call the Hidden Inefficiency Virus or Business HIV.

At its most fundamental DNA, Business HIV is the average individual’s response to too much and contradictory information. Needing to make decisions that guard profit and no longer having a grasp on the millions of pieces of data that dart in and out of their field of vision, business people have settled into a way of thinking that makes them wrong often but rarely willing to admit that they’re wrong. Doing so would require more in-depth study of data than they feel they can do. Sticking with saving money as the bottom line seems like the wisest course of action to many decision-makers.

Economic, human and social realities fly in the face of this sort of out-dated logic, however. The more time you spend investigating your own needs and the offerings of different vendors, the more money you can save – not only in the purchase but also in the long-term. The more money you spend on individuals with specific expertise, the more money you are likely to make as your operations improve.

Business HIV removes the real logic and replaces it with a sense of false scarcity and urgency. Business HIV is an emotional and intellectual disease that prevents decision-makers from seeing how off course they really are. It’s ego, comfort, fear. . . and it’s just plain illogical.

The remedy to Business HIV is a restructuring of the big picture. A realization that costs such as energy, taxes and insurance are spiraling and they’re not going to come down. Competition is more rampant than ever in the history of commerce as Third World countries replicate everything better and cheaper. A new strategy based on people creating profit through innovation is the only antidote to Business HIV.

Are you ready to move from a sick mechanical business model to a healthy organic business model? Are you ready for that shot in the arm?

CJ is a regular contributor to HRTools.coms.
You can now get your own copy of his groundbreaking book, The Squaredime Letters.
You can vist CJ online at www.cjcoolidge.com.

Often Wrong, Never Unconvinced

I grew up with a certain amount of arrogance that's tied to a perception I have about my own intelligence. I suffer from a malady described by Dr. McFarland in 1961. I am often wrong, but never unconvinced. You may benefit from a realization that the same situation pertains to you, or to others you work with every day.

Choosing to recognizing it can help you make better decisions and do better business.

Here is a small portion of a talk that I gave recently describing this phenomenon.

You can visit CJ online at cjcoolidge.com.

Do You Know too Much to Increase Your Profitability?

In 1267, Roger Bacon published his Opus Maius, an 845 page work, said to contain all the knowledge in the world. Imagine that. All the knowledge in the world in a single person, and in a single volume. You'd have to be a teenager to make such a claim today.


In 1961, before the dawn of Moore's Law, and before the proliferation of the silicone chip, Dr. Kenneth McFarland wrote that there was already a veritable information overload, such that a seeker could often find entire sets of developed knowledge in direct contradiction of other entire groups.


The only way that a person could hope to avoid inaction and indecision caused by confusion due to such disparity of truth would be to limit the intake of information, and the type of source for information.


Dr. McFarland said that such a defense strategy would necessarily produce individuals who would be "often wrong, but never unconvinced."


In January, 1999, UNESCO reported that there were some 869,000 books in print. By December, that number had jumped to 1,963,000. The pronouncement that, for the first time in verifiable history, human knowledge had more than doubled in less than a year.


With Moore's Law in full swing, there have been at least 30 doublings since Dr. McFarland's pronouncement in 1961, and 6-8 doublings since 1999, when UNESCO reported its findings.


To whatever degree Dr. McFarland's observation could have been observed to be true in 1961, there can be no doubt that it is certainly true today, true of more people, and true more often.


More than in 1961, today there are multiples of bodies of information in direct contradiction to other bodies of information.


How else could NASA Scientist, James Hansen assert that oil company CEOs should be tried for crimes against humanity for their contribution to "Global Warming" now called, simply, "Climate Change." At the very same time, meteorologist and founder of The Weather Channel, John Coleman, wants to sue AL Gore for financial fraud in order to "expose [his] fraud of "global warming." You can't get any more diverse with these "bodies of information."


There are thousands of other examples.


As to the tendency to limit the types of sources from which we learn: Well, some listen to Rush Limbaugh, others to Al Franken. But nobody listens to both. What about the blogosphere? Some read Townhall.com, others DailyKos.com, but nobody reads them both.

How else could we find our political system so polarized?

Now I'm not advocating that people need to become open-minded. And I'd be the last one to say that every position is valuable, or even worth consideration. What I am saying is that if Dr. McFarland could report way back in 1961 that people are "often wrong but never unconvinced," that the situation is multiplied many times over today, particularly in the entrepreneurial world.

The average entrepreneur, small business owner, is dangerously susceptible to this condition. With ever increasing distractions and decisions, the opportunity for error is increasing by the day. The occurrence of error is increasing every day. But the error is invisible. (The decider is convinced that he is right!) As a result, the inefficiency created, will also be invisible.

I've started calling this condition "Business HIV." It's the "Hidden Inefficiency Virus." It's the situation in which a business builds inefficiency into the very business model. It's what a 2008 Reuters report says about a software business that spends 10x more "fixing" than "producing."

You might have Business HIV if:

• You feel relieved when an employee quits, knowing that your payroll expense will be reduced while the position remained unfilled.
• You reported to your board that you had cut your health insurance plan increase in half; You didn't report or realize that the cost of the use of corporate resources exceeded the value of the reduction.
• You handle harassment training by making your employees watch the inexpensive generic videos. It was "affordable" training, too, so long as you don't recognize that you wasted an hour of time, energy and focus boring them to death, and accomplishing nothing important. Well, you did check a box on some compliance checklist.
• You try to take every offer from a vendor/associate to the simplest form so that you can "shop it" and minimize your expense. You believe that all those "value adds" are just excuses to get you to pay more than you have to.
• You assume that, if Peter Drucker said it, it doesn't apply to you.
• You believe that the less you pay, the better the deal.
• You believe that if anyone could take two weeks off from the job, you really didn't need them anyway.
• You measure and monitor your sales cycle, but not your attrition.
• You believe turnover is a "soft cost."
• You don't believe that your company can afford to hire great people.
• You believe outsourcing is a way to get another company to do the same things you used to do yourself, for less.
• You believe that outsourcing is a stopgap, a temporary way to handle things that, when you get big enough, you can bring them back in house.
• You believe that sometimes it costs too much to do it right.

The pressures of today's business world don't tolerate the same level of inefficiency acceptable in days gone by. "Often wrong" then, happened far less often, and had far less impact than "often wrong" today. And "never unconvinced" just looks stupid.

Half of being smart is knowing what you're dumb at. Then, find somebody smart, and let them handle what they're smart at. It is a lot more efficient.

Visit CJ online at cjcoolidge.com.

My High Cost of Not Outsourcing

If it isn't part of your central value, it ought to be outsourced.

I couldn't be any more convinced. Not doing so causes me more time and focus waste than I can afford. I can't afford doing thigs that I am not gifted, resourced, talented, or interested in doing.

Today my hard drive failed.

I turned my HP laptop on this morning. The little power lights illuminated. Then, they shut off. Then they illuminated again. Then they shut off. A 3rd time, they illuminated. A third time, they shut off. Before it happened a 4th time, I pressed the power button . . . an attempt to start over, fresh.

I removed the battery and the A/C power connection. I waited 15 minutes.

I re-inserted the A/C, and re-launched the machine. Nothing had changed.

I did notice that the light which indicates that the hard drive was spinning was not lit.

OK. This is not good. I have seen hard drive failure before.

I called the warranty service group. They asked me to repeat what I had already done. No luck.

"We will send you a lable so you can send us your machine."

"How long will that take?"

"You will have the label in 3-5 days."

"How long will you have the machine?"

"We will have it for 7-10 days."

"And then?"

"We will send it back."

So, in the perfect world, if 'everything' works, I won't be able to get back into full service for at least 2 weeks.

What if the hard drive needs to be replaced? That's easy. I'll just reinstall my backup. Whoops, I don't know how. I guess I can learn, but it will cost me another couple of hours, not taking into account the hours it will take for the data transfer.

What will this cost me?

From the mechanical model perspective, maybe nothing. The postage is paid, the warranty covers the service. They'll even replace the hard drive, everything good as new.

From the organic, real perspective, it will cost a small fortune.

There's the direct time I need to "waste" fiddling with the machine. With all the time invested, the best result would be a return to equilibrium. Time and focus invested, noting gained.

There's the opportunity cost for what I would have otherwise been doing during the direct time.
There's the opportunity cost for the things I will not be able to do because I don't have the machine.

There's the cost of the total lack of focus, and the distraction. You see, this morning I was to finish the composition of my latest speech, one I had started yesterday, a breakthrough presentation based on an inspiration I received this past week, to be delivered at a major event early July. That one speech could be worth $ thousands. But, as we creative folks know, I could lose it if I don't finish it while inspired.

Wait, with the distraction and frustration of the morning, I have already lost a good deal of that inspiration. I think I'm going to be sick.

I needed an IT outsource.

What I need is an IT outsource to make sure that my systems are what they need to be, how they need to be, and where they need to be. I don't need a full time IT person, neither do I need a quick fix technician who will get his initial look at my system only when he sees it not working.

What would a good outsource have done? I don't know all the details, but I do know this. I would have made a call to someone who knew the who, what, where, when, and why behind my little IT operation, and then I would have been able to relax. In just a minimal amount of time, I would be back in business, minimizing my distraction and down time. I would complete my inspired project. I would hardly stumble through the day.

As it is, my mechanical, cost saving approach is going to cost me a fortune.

Rigidity: Bad for Engineering, Bad for the Economy, and Bad for Business

Rigidity has never produced a structure capable of good function in an environment of changing conditions.

• Skyscrapers are designed with the ability to "sway" in the wind, or to "flex" in case of an earthquake.
• The wings of the great airliners are designed to "give and take" in the face of changing air density and current so that the body of the plane can maintain maximum stability in turbulence.
• Bridges, towers, roads, ships are strengthened with flexibility.

Attempting to eliminate this "flux" with rigidity would result in disaster.

It works the same way when attempting to develop increasing profitability, or human capital. Rigidity kills.

Why, then, do presidential candidates like John McCain, Hillary Clinton, and Barack Obama continue to press as though greater centralized control and rigidity offers anything of a benefit to America's economic strength in the face of ever changing conditions?

Why do so many otherwise intelligent Americans fall for the same tripe?

The Answer is simple. They all must be ignorant of the way things really work. Or, maybe, it's a power thing.

As I will continue to suggest, whatever economic conditions may seem to create problems for our society, each is solved when individual participants learn to contribute in a value producing and meaningful way.

It's the way of the organic business model.

• Every participant can then know what he/she does best.
  
• Every participant can then discover how what they do makes a difference for the people or companies they serve.
  
• Then, because the organic system strives to compensate based on the actual value delivered, each participant may elect to contribute, and therefore earn, as much, or as little as they desire.
  

No heavyweight management is required. No supreme controller or almighty decision maker is necessary. No artificial value requirements need be imposed.

It makes sense.

All of the mechanical model "controllers" ought to pay attention to Brian Wesbury, chief economist for First Trust Portfolios, LP. In an editorial published June 11, 2008 in the WSJ. Brian astutely observes:

"In contrast to what some people seem to believe, having the government take over the health-care system is not change. It's just a culmination of previous moves by government. And the areas with the worst problems today are areas that have the most government interference – education, health care and energy."

"The best course of action is to allow a free-market economy to reallocate resources to the place of highest returns. In the midst of all the natural change, the last thing the U.S. economy needs is more government involvement, whether it's called change or not."

Only an Organic Model solves the problems.

In today's hyper-dynamic world, hardening mechanical models in attempt to improve economic conditions will prove no more successful than removing the flexability from the wings of an aircraft. Such practices will, at best, increase the discomfort of the passengers. At worst, it will render the plane unfit to fly.

Rigidity will produce the same negative impact for the economy, or for your business.

The High Value Capital of Business - It's Not What You Think; It's Human Capital

Peter Drucker's comments about business structure and management emphases tickle me. They tickle me because the very statements he makes run absolutely counter to the widely held beliefs of today's "experts." The difference is staggering.

In his 2002 book, Managing in the Next Society, Drucker makes comment about the problem "financial people" have managing business.

"There's an enormous challenge ahead to educate the owners of business, many of whom, as I've noted, are financial people. I once was a securities analyst, so that gives me license to say that it is virtually impossible to make a financial person understand business. I am not being facetious. Financial people don't deal with the issue of balance between often conflicting elements - short versus long term, continuity versus change, improving today versus creating tomorrow. Corporate leaders who wrestle with these issues every day know the amount of struggle involved, but it's difficult for financial people to understand this."

This ought to shake you to your core.

Why all the emphasis on managing by financials?

It happened simply and innocently enough. We began to confuse the financial statements with the business, itself. Human capital is thought to be either non-existent, or of little real value.

For more than 50 years the relative stability of technology and demographics paved the way for repetitive, mechanical hierarchical business models to succeed. They had predictable structure, and outcome based on repetition of mechanical practices, which then yielded predictability in financial results, creating the false association. Good financials were erroneously equated with good business. The two patterned so closely that the difference would be difficult to discern.

Market Hyper-Dynamics Defies Management by Financials

Today's technological landscape is no longer as stable and predictable. The demographics are also nothing like those characteristic of the last 50 years. The entire landscape is in constant and accelerating change. In this new world, it is now necessary to see a business for what it really is, and to recognize that financial statements are merely the report card for how the business is working. That is their only relationship.

A Business is not a Machine, it is more like a life.

A business is a complex web of conversations and social relationships. Out of these comes the continuous ebb and flow of the menagerie of products and services, which are developed, created, communicated, delivered, and serviced by provider companies to their customers. In this hyper-dynamic marketplace, it is far less important what a company thinks they do as much as why, for whom, and for what betterment of the customer and the world itself.

Conversations and relationships are characteristics of a different dynamic than a machine. They are characteristic of people, humans, living things. They are organic in their very nature, and require organic processes and organizations to endure. People are the very soul of business. Human Capital produces the value of all other capital.

I heard the CEO of an energy related firm make this very interesting statement.

"When we consider the human relationships as critical in my enterprise, we have a struggle as our material "assets" as shown on our financials represent $BB, while our people "assets." even as costs represent only $MM. It seems that the larger assets are the most important. We are coming to recognize that the real value of the material "asset" is totally dependent on the performance of the people, and this is leading us to realize that the people "asset" is of greater significance to the company performance, rendering the material asset as valuable, or potentially, value-less."

Which "assets," which "capital," do you value most?

I guarantee, if you think like a financial person, you'll answer incorrectly.

If you think like a traditional business person, you'll risk the same error.

Consider thinking more like Peter Drucker. Then you can begin to place more of your energy and investment into the things that produce your greatest ROI. These, of course, are your people, your Human Capital, and if you're like most of today's managers, you are well under equipped to do much to make improvements.

It is time to get some help for your organization. I wouldn't wait. I might even call a PEO.

Ric Campo Talks About People, Profitability, and Corporate Culture

I just left a very interesting forum, sponsored by executive recruiting firm, Austin Allen at the River Oaks Country Club in Houston.

Ric Campo, a founding partner of Camden Living, gave a powerful and informative presentation. His comments were filled with the very precepts Camden followed to become a Fortune 100 Best Companies to Work For award winner in 2008, and, one of the finest multi-family real estate development and operation companies in America.

I took copious notes. Ric was singing my song.

Ric's management principles are not the common practice in today's world. Read and see why they should be.

Just to highlight a few of his salient points:

• Camden has well defined, well communicated missions and values. These do not change with market conditions.
• Camden believes that their front line employees are the most significant contributors to the company's success.
• The Company's value isn't derived from a focus on their material assets. Ric said, "It's not about assets, it's about people. Our people are our assets."
• Camden strives to hire the best and the brightest. Then, the company strives to give them responsibility and authority to deliver Camden's mission.
• Camden recognizes success based on the creation of an increasing number of high-quality, long-lasting jobs. This is representative of their belief that people are their greatest asset.
• Camden is very concerned and intentional in maintaining and developing their outstanding corporate culture.
• In the Fortune Employee surveys, Camden had 92% of their workforce saying that Camden was truly a great place to work. The average among the Fortune top 100 was 89%.
• Camden is a stickler for "best practices" in handling people. (This is why more companies really need to engage the services of a PEO.)

That might work for some companies, but not when things are tight, or tough.

Some might argue that this is all well and good for some high margin, fluff company. Don't kid yourself. Camden's business, in today's market, is anything but that. They must thrive in a tough, highly competitive, asset intense business. Camden's profitability challenges are as big as they come.

Employee Practices Turn-Around an Acquisition

I particularly enjoyed the story Ric told about one of his mergers. Camden had acquired a fairly large company with an east coast presence. The acquisition had everything it needed on paper to be functioning well, yet, at the point of the acquisition, was not doing so. They even verbally ascribed to the same management and cultural philosophies that worked so well with Camden.

However, on closer look, their talk didn't match their walk. The reason for poor performance could be tied to this divergence, a response to some very difficult, but temporary market conditions. It turns out that the company had frozen salaries, cut bonuses, and increased the employee contributions to their medical plan. Meanwhile, they hadn't cut the executive compensation.

Ric said that these actions upset the affected folks, which, in turn, affected their ability to perform. Needless to say, Camden corrected the situation, in accordance with their mission, and the situation righted itself quickly.

Happy People: Successful Enterprise

Camden demonstrates the true, but rarely followed axiom: The happier the people, the more engaged they will be, the more profitable the enterprise.

This validates the well researched message of Richard Hadden and Bill Catlette who wrote Contented Cows Give Better Milk, and the sequel, Contented Cows Moove Faster. Companies with well placed, well rewarded, well aligned, happy employees, are able to do more, make more money and have fewer problems.

It's kind of funny that most managers still can't see it.

They will, though. They'll need to to survive.

You Can't Stop the World, And You Can't Just Get Off, Either

Everything is changing. Not a new phenomenon, but an accelerating one.

The rate of change is so great, that more than 50% of US business execs are finally confessing that they are struggling with its pace. And, let's face it, even the rate of change is increasing. I call it Hyper-Dynamics.

It effects everything in our lives, and our companies, much of which management tries to ignore.

Consider some changes we business owners tend to try to ignore.

• Employee Ability and Aspiration: What an employee once wanted to do for you, he no longer wants to do. He may have matured in his current role, and desires a new challenge. She may now have young children at home, and no longer wants to travel. Children may have "left the nest" and she now wants to travel. The individuals which hold the IP in our enterprises are changing just as quickly as is everything else, but we have no systematic way to deal with these factors, and are inept at adjusting our roles and processes to take advantage of the opportunities these changes afford. Instead, we underutilize the people we have, and we just let then go when are mechanical models no longer require their service in the box we have externally defined.

• Customer needs: What a customer wants from you today is different from what he wanted yesterday, and what he'll want in the future. They are seemingly more fickle than ever. 80% of customers who leave would say that they were satisfied, or very satisfied with your service. But they left you, hoping to find a better value from another provider. Our offerings have been devised and "perfected" from our own perspectives. Our internal systems are mechanically created to provide what we think we should provide. Adapting to customer's felt needs takes a back seat to our beliefs about the way things are. "That's not our policy." "We can't do that." We justify our position: "We've never had to do that before. We don't need to start now."

• Markets: The entire market has the potential of the international corporation. What was once a regionally valued offering may now be available from a remote producer in China. Outsourcing and off-shoring can render our offerings obsolete. When faced with these challenges, we make the false assumption that we just need to work harder at what has always worked before. We push our sales people to make more calls. We push our service people to work harder. We push our management to work longer.

• Costs: Energy, healthcare, taxation, insurance, natural resources, and people costs are rising at unprecedented rates. The forces that are pushing them are not even within our control. But we believe that we must make their containment a significant part of our strategic management initiatives. We spend a dollar to save a dime. We focus on financial statements, correcting them, as if they were the business itself.

• Product value: Whatever I can produce today will be more efficiently produced in the future. Shelf life of ideas is shorter than ever. Windows of profitable opportunity are smaller than ever. But we still function as if we can develop something, sell it profitably, and rest, as though we have arrived at something that will last. We resent the copy-cat, or the competitor that says he does exactly what we do, but at a better price. We gripe about the imitator from the 3rd world who unjustly sells to our customers.

There are many, many more, but these few provide enough to exhaust many the mechanically minded manager.

Our refusal to accept hyper-dynamics will, simply, lead us into disaster. Short term solutions will merely exacerbate our problems. Self delusion just guarantee the inevitable.

My solution? REALLY embrace change. I know it sounds trite, but the mere statement of the words does not prove the reality behind them. I mean embrace, welcome, anticipate, expect, and adapt.

With this, you'll need to grasp the concept of absolutum obsoletum. Whatever we think works today is becoming absolutely obsolete . . . and sooner than I might think.

The solution comes with the change from a mechanical, change resistant organization into an organic, change adapting one. Change from the organization that orchestrates change to one that is able to flow with the change. These are entirely different approaches.

• Instead of telling your customers what you do, and expecting them to buy, learn to discover what they want and need that you can offer.

• Instead of determining what your company should be doing in antiseptic board rooms, let the front line employees tell you what their encounters with the real world are telling them.

• Instead of defining jobs for your employees, telling them what you want them to do, discover what they would do for you and your customers, if they could.

• Instead of losing sleep and fighting against rising costs, use your people's creative and innovative energies to identify your own company innefficiencies and redundancies.

• Instead of thinking you have the totality of responsibility or all the answers, free your people to create entirely new, high value offerings for your current customers, and for customers not yet reached.

Besides, you and I already know that the greatest opportunities for excitement, value and profitability exist, not in the middle of the pack, but around the edges, where risk is sometimes the greatest. The rate of change means that yesterday's performance is not the end. Everyday comes with new, high value opportunity. It's up to you to find them, but you need to be looking, hoping and expecting.

And, best of all, you don't need to go it alone. Get your people in the act. Teach them that you value their looking, hoping and expecting. Then, don't ignore what they'll show you.

You might as well make a lot of money, too.

It's Still True Today: HR People are from Venus, and Business People are from Mars

Keith Hammonds posted an article on Fast Company titled, "Why I Hate HR." It describes conditions which are typical of the attitudes and experience of companies when considering the involvement of their HR processes as profitability drivers. It is an old article, but well worth re-reading as the problems he communicates aren't really any better handled since he wrote it nearly 3 years ago.

One of the best means of immediately impacting the performance of employees (and with it, the increasing the profitability for the employer) is the performance review. As I have illustrated in a post comparing the sports world with the corporate world, effective performance review processes are tremendously beneficial to employees and companies alike. Yet they continue to be mishandled and misunderstood, therefore, ineffective.

Hammonds asks the question that is typical of management's attitude about them:

"Why are annual performance appraisals so time-consuming -- and so routinely useless?"

The answer is simple. Management doesn't really know what they are, or, consequently, how to use them.

Management doesn't understand what the sporting world does.

• Management isn't clear in communicating objectives.

• Employees don't know how their work impacts the company.

• As a result, nobody knows how to tell exactly how performance aligns with either.

• It naturally follows that there would be no resource to improve performance, because no one knows exactly what to improve.

I know how to fix it. So do many others. But management doesn't seem to care.

Why not?

It's the age old, nagging problem. The HR teams don't know how to connect with the business teams. The business teams don't know how to connect with the HR teams. And, this connection is critical to the success of both. HR is irrelevant without the ability to connect to business.

For 20 years, I have researched this problem. In that research I have discovered that most of the thinking about these issues comes primarily from the ivory towers of think tanks and universities. Their revelations may be true, and their conclusions accurate, but the information is too generalized and difficult to apply. To be of much use to most companies, someone needs to connect these discoveries to the streets, where the rubber meets the road.

I will do that with my new book, The Squaredime Letters, to be released this summer. Squaredime will provide real guidance for business and HR groups alike. It is a must read for both HR professionals and management alike.

The good news is that when the HR/Business connection is finally made, productivity and profitability will be substantially improved for everyone involved.

You know what that means? More earnings for all.