Aubra H. Anthony, Jr. Announced as the 2009 NAWLA Mulrooney Award Recipient

NAWLA will award the industry’s highest honor, the NAWLA Mulrooney Award, to Aubra H. Anthony, Jr., Anthony Forest Products, on April 27, 2009 during NAWLA’s 117th Executive Conference. The Conference will be held at the Loews Lake Las Vegas Resort in Henderson, Nevada. Attend the NAWLA Executive Conference and Celebrate with Aubra!

Aubra serves as President and Chief Executive Officer of Anthony Forest Products Company, a four-generation, family-owned timber and forest products business.  The company is headquartered in El Dorado, Arkansas. They operate two sawmills, two wood chip mills and two wood laminating plants with locations in Texas, Louisiana, Georgia and Arkansas.  The Company manages 91,000 acres of timberland. They are third party certified under the Sustainable Forestry Initiative.

The NAWLA Mulrooney Award was created by the North American Wholesale Lumber Association Board of Directors in 1979 as a testimony to the life and career of Jack Mulrooney and particularly the contribution he had made to the forest products industry in North America.  The Award is to be presented to some person who has made a significant contribution to the forest products industry, especially with reference to distribution.  The recipient need not even be in the forest products industry as long as the industry has been the beneficiary of the person’s service.  This award is not intended to be an in-house award honoring one of our own.  Candidates must also have demonstrated in their personal life the highest contributions of their time and talents in their own communities in service to others.

Financial results for Stock Building Supply, the industry’s second largest pro dealer, recorded a loss of $129 million for the six-month period that ended on Jan. 31, 2009, according to figures released on March 6 by parent company Wolseley. These losses, attributed to deteriorating housing starts in the U.S. market, compare to a loss of $81 million in the same period a year ago.

Stock’s net sales for the six-month period were $1.33 billion, a 25.5% drop from sales of $1.79 billion in the comparable period the prior year.

Cost cutting actions taken during the half-year period include the closure of 83 Stock branches and three distribution centers, as well as a total head count reduction of 4,330. The Raleigh, N.C.-based division now operates 202 locations.

Despite these measures, Stock has continued to exert a downward pressure on Wolseley’s finances. The U.K.-based global building materials company said it is looking to sell all or part of Stock’s assets over the next few months. (A joint venture is also a possibility.) Wolseley’s stated goal is to exit its Stock LBM business by August 2009.

Wolseley will hold on to Ferguson, its plumbing and HVAC business in the United States, although this division also suffered some cuts in the last half. Total branch numbers were decreased by 22 to 1,338 locations, compared to 1,382 branches in the previous period. Ferguson also reduced its head count by 2,067.

Financially, Ferguson performed well compared to the overall market, Wolseley said. Revenues declined by 11.3% to $4,928. Net income dropped by 21% to $284 million.

Wolseley announced early March 6 that a number of third parties have recently expressed an interest in the possibility of acquiring all or part of the Stock business.

The decline in housing starts, coupled with a continued decline in lumber prices have forced Wolseley’s hand, spurring the decision to pursue a sale or joint venture -- "or to dispose of or otherwise exit Stock Building Supply, by Aug. 1, 2009," Wolseley said Friday.

“We are working very closely with Wolseley to identify potential partners that can help Stock Building Supply grow when the market recovers,” said Stock Building Supply president Joe Appelmann. “Our business model has fundamental differences from the remainder of Wolseley’s portfolio, and in these economic times it makes sense to explore other options.”

Last October, Stock announced an expansive cost reduction program and a significant restructuring plan to position the business in markets that will be strongest on recovery.

"Today, the housing starts [in the U.S.] are running at something around 460,000 starts per annum,” said John Whybrow, Wolseley chairman, speaking at the March 6th Wolseley conference call. “Today, we announce our exit from that business. I think, ladies and gentlemen, enough is enough. We cannot go on with markets deteriorating like that."

Source: Home Channel News
www.homechannelnews.com

Distributors Left with High Levels of Devalued Inventory

The convergence of declining demand and rapidly deflating commodity prices has left many distributors holding onto significantly devalued inventory, no matter how good their inventory management systems were.

Why? Because distributors began stockpiling last year as prices climbed. When the prices plummeted, that stockpile didn’t look quite as good. Inventory levels jumped $6.2 billion in the fourth quarter, according to the U.S. Commerce Department.

There are ways to mitigate this situation. I recently spoke with an electrical distributor in Southern California.

Some of the advice he offered:

• Know what’s available to you locally. You don’t have to keep high levels of low-demand inventory for items that you can restock on short notice. But beware of "fly-by-nights" that may also take advantage of this and reduce the value of your inventory even further.
• At the same time, be very careful about maintaining a healthy cash cycle so that you can respond effectively.
• Be aware of how price indexes function. Distributors may see a lag time when prices start rising, so understanding that will help you maintain appropriate prices to keep at least some of your inventory moving.
• And, take the lessons of the downturn with you into the better times. Improving your inventory management now can only help you later.

Source: Modern Distribution Management
By Jenel Stelton-Holtmeier
Learn more about MDM's premium content here.

Builder, in conjunction with Hanley Wood Market Intelligence, debuts its metric for determining markets with the best and least potential.

With most economists and builders expecting a national market decline this year, this may not seem like the best time to be selecting the "healthiest" markets in the country. Virtually every market was down last year. But a close look at the numbers reveals that some markets have way outperformed others during the last four years and are likely to continue to do so this year.

When the housing market stages its official recovery, the markets listed on the following pages are likely to lead the parade. It may take a year or more for the weakest markets - where burgeoning foreclosure sales are still pounding new home values, making building and selling new homes an exercise in futility - to finally stage a turnaround. We’ll present that list next week.

The healthiest markets have many things in common. Most of them are great places to live, either close to the ocean, mountains, or major universities. Most of them didn’t have a huge run-up in prices during the boom and aren’t experiencing rampant deflation during the bust.

To compile these lists, we analyzed the top 75 housing markets in the country. We ranked them based on population trends and job growth, perennial drivers of housing demand. We also examined what’s happened with home prices; many of the healthiest markets have managed to hold the line on home values. And finally, we considered the rate building permits, which may be the single best ongoing indicator of builder confidence in a market. We combined all these metrics to produce a score for each market. Here is the top market for 2008.

Click Here to link to the top 15...

Source: Hanley Wood Builder
Website: www.builderonline.com
Boyce Thompson

2008 Total Building Permits: 42,697
They like to do things big in Houston. Now the metro area, home to more than 5.8 million people, can lay claim to being the largest home building market in the country, with 42,697 building permits. The market is still benefiting from an influx of population and jobs and rebuilding in the wake of Hurricane Ike. Employment was up 2.5 percent last year, representing the addition of an incredible 65,000 jobs. Home building activity in Houston has only fallen 31 percent since 2005. Also, existing-home prices rose in Houston through the first three quarters of last year. They finished the year at a median of $151,600, even with the previous year. Roughly one-third of the home building action is in Harris County, followed by Houston proper and Fort Bend County. One of Houston’s largest builders, Royce Homes, shut down last year, and Kimball Hill, one of the biggest builders in Texas, closed its doors this year after it failed to find a buyer.
Busiest builders: Lennar, Perry Homes, David Weekley Homes, MHI/McGuyer Homebuilders, and KB Home. Courtesy: Hanley Wood Market Intelligence.

Click Here to see all the 15 top markets.

NAW is pleased to announce that registration is now open for its Wholesale Distribution Manager’s Course (WDMC), June 8-12, 2009, on the campus of The Ohio State University in Columbus, Ohio. To read the press release, go to http://www.naw.org/files/WDMC_2009_PR_021209.pdf.

Today’s economic turmoil has changed the business model for wholesaler-distributors. The old rules are changing, and every distribution company needs to revisit its business operations. That’s why in these challenging and uncertain times, it’s more important than ever for your members to attend and think about the future at the WDMC.

With their deep experience in the wholesale distribution industry, the WDMC faculty will adjust their teaching to the current economic conditions that prevail and they will challenge WDMC participants. In addition, participants will have the opportunity to network with other distributors—from various lines of trade—and learn how they are handling the same issues and how they are approaching new marketplace realities. The valuable training and education experience your members will receive at the WDMC will definitely impact the future of their business.

Visit www.naw.org/wdmc09 for more information about the WDMC or call Vicky Walsh at 202.872.0885.

Builders FirstSource, one of the industry’s largest LBM chains, reported fourth-quarter sales of $201.3 million for fiscal 2008, a 30.6 percent drop from sales of $290.2 million in the same quarter of 2007. Net loss for the quarter, which ended on Dec. 31, 2008, was $58.9 million. This compares to a net loss of $20.4 million in the fourth quarter a year ago.

For the full year, the Dallas-based pro dealer posted $1.03 billion in sales, a decline of 30.4 percent from sales of $1.53 billion for fiscal 2007. Net losses for fiscal 2008 were $139.5 million, compared to a net loss of $23.8 million for the previous year.

The company closed or mothballed 14 facilities in 2008, recording closure costs of $4.8 million. Average headcount was decreased 39.2 percent during 2008, a reduction of more than 2,100 positions.

Citing the NAHB’s forecast of 461,000 single-family housing starts this year, Builders FirstSource CEO Floyd Sherman said he expects 2009 to be “a continuation of a very difficult housing environment.”

“We will continue executing our strategy of implementing cost-containment programs, managing credit tightly, rationalizing physical capacity and growing market share in order to conserve liquidity,” Sherman said in a prepared statement. “The continued execution of our strategy coupled with $94.1 million in available cash and $35 million in expected income tax refunds in 2009 should provide the liquidity to weather yet another year in these unprecedented industry conditions.”

Ranked No. 9 on the Home Channel News Top 350 Pro Dealer List, Builders FirstSource operates 58 lumberyards in 11 states, primarily in the southern and eastern United States.

The NAWLA Executive Conference will be held April 26-28 at the Loews Lake Las Vegas Resort in Henderson, Nevada.  Give yourself and your company an opportunity to learn how your peers are getting through these difficult times. All it takes is one gem of an idea to make the meeting worthwhile. Network with your peers, customers and suppliers and learn from Dr. Adam Fein Strategies for Surviving the Recession.

One highlight of the event will be the presentation of the NAWLA Mulrooney Award to Aubra H. Anthony, Jr. during the General Session.

Adam J. Fein, Ph.D., founder and president, Pembroke Consulting, Inc. will present a thought-provoking program as he describes how the current economic conditions affect our business. He will give his forecast for 2009 conditions, and lead discussions on successful strategies during these times.

The NAWLA Boston Regional Meeting will be held in conjunction with the NeLMA meeting on April 2nd. This well attended meeting will be a great opportunity to get together with your peers, customers and suppliers.

$59 / Person Includes:
Breakfast
Networking Opportunities
Roundtable Discussions
Boston Marriott Newton
2345 Commonwealth Ave., Newton, MA
Phone: 617-969-1000

Website: www.marriott.com/hotels/travel/bosnt-boston-marriott-newton

Click here to register for the NAWLA Boston Regional Meeting.

A highlight of the meeting will be Roundtable Discussions 10 Group Style. Come discuss and share with your peers what you have done to prepare for this market, what has worked for you and why did you not do it sooner. Also discuss with the group what made a difference in your company’s ability to face these difficult times.

We are all searching for the textbook which outlines the perfect way to navigate a difficult economy. There is no simple answer. Join us for a group discussion on what works and how NAWLA delivers value to their members. Please come prepared to: Offer your insight; Learn a few pointers; Share your expertise; and Help your peers.

Schedule of Events:

• 7:00 a.m.               Registration Open
• 7:00/8:30 a.m.       Breakfast and Networking
• 8:30/8:45 a.m.       An Introduction to NAWLA 10 Groups
• Meeting Co-Chairmen:
• Jed Dawson, L.R. McCoy
• Jim Robbins, Robbins Lumber, Co.
• Susan Fitzsimmons, NAWLA Chairwoman
• 8:45/11:00 a.m.    Your Turn...NAWLA 10 Group Discussions (by Subtopic)
• 10:00/10:15 a.m.   Break
• 11:00 a.m.            Adjourn

Join your business colleagues at the NAWLA Portland Regional Meeting for a fun and educational evening while watching the city sights from high up in the heart of downtown Portland and feasting on exquisite cuisine. Hear tips on how to be a better leader from one of Oregon's top coaches and find out more about our economic health from a leading Oregon economist. You'll find it to be time well spent — and for only $89 — it's a bargain!

Click here to register for the NAWLA Portland Regional Meeting

NAWLA Portland Regional Meeting
April 9, 2009
Portland City Grill
111 5th Ave (at Pine Street)
Portland, Oregon
(Free validated parking under building)

• 4:30 p.m. Cocktails
• 5:45 p.m. Welcome & Dinner
• Tom LeVere, North Pacific
• Susan Fitzsimmons, NAWLA Chairwoman
• 6:45 p.m. Mark Palmer, Executive Director, Interim CEO
• 6:50 p.m. Introductions of Speakers
• Monique Bauer

Leadership is Service
Presented by LaVonda Wagner
Oregon State Women's Basketball Coach

Searching Through the Entrails
Presented by John Mitchell
M & H Economic Consultants

Don’t miss the Lumbermen’s event of the year, the NAWLA Vancouver Regional Meeting.  This meeting has a new, more exciting format with lower pricing from last year.  It will be held at The Vancouver Club with cocktails and hors d’oeuvres served by the Benkratz Hostesses.

NAWLA Meeting: 3:30 – 5:30 p.m. / UBC Room

Speakers: Mike Wisnefski, VP of Bloch Lumber
Ken Shields, CEO of Conifex
Paul Quinn, RBC – Forest Products Analyst
Sponsored by Euler Hermes Group

Already in March, NAWLA is gaining momentum for THE industry event of the year. The NAWLA Traders Market^® Committee is diligently working to offer you a top-notch event in Chicago. There are already 506 registrants for the show in November. They were smart to register by March 10 and take advantage of the $100 Discount.

What’s more is that NAWLA exhibit booth sales in 2009 have surpassed 115 companies so far. These companies have contracted booth space and have dedicated employees and resources towards exhibiting in show in November.

Both the NAWLA Traders Market^® Committee and the NAWLA Education Committee are crafting a schedule of timely topics, speakers and events for your professional development and enjoyment this fall. A General Session and educational sessions on changing distribution channels and housing markets and an early close to the show are being discussed.

The official NAWLA hotel is the Hyatt Regency Chicago. Book your guestrooms now online at www.nawlatradersmarket.com. The rate is only $199 / night plus tax (single and double occupancy). Please carefully read the guestroom cancellation policy for 2009. Participant registration will reopen at the end of May 2009.

Mark your calendar for the NAWLA Traders Market, November 5-7, 2009 in Chicago.

Welcome NAWLA’s newest members for the month of February

Sure Drive USA/Pan American Screw
Manufacturer
Contact: Phil Lail
630 Reese Drive
Conover, NC  28613
Phone: 800-951-2222
Fax: 828-466-0070
Verifiers:
Brian Orchard, Tylan Enterprises
Bill Hurst, Mid America Cedar

Sure Drive USA is a manufacturer of fasteners for construction and woodworking.  They specialize in fasteners for decking, construction, and hidden deck fastening systems.

Wood Priming Products
Service Affiliate
Contact: Chris Robertson
P.O. Box 535
Oakwood, GA  30566
Phone: 770-965-4151
Fax: 770-965-4153

Reinstatement

Wood Priming Products provides factory priming and painting services to wholesale lumber companies.

Capital Lumber Company, Phoenix, Arizona announces additions and changes

Capital Lumber Company, Phoenix, Arizona announces that they are now distributing Collins Companies TruWood products throughout Northern California.

Capital Lumber Company also welcomes Seth Beisner, Operations Manager for its Albuquerque Division. Seth brings over 14 years of industry experience, most recently with SelectBuild.

Weston Forest Products, Mississauga, Ontario is pleased to announce that Agnes Flinn has joined its North American Sales Group. Agnes has been in the lumber industry for over 20 years, first as a Purchaser and Trader for Canwel and Eacan Timber and then as the owner of her own company, Pine Island Lumber Ltd.

“Agnes will bring a tremendous amount of purchasing and sales experience to Weston, particularly increasing our depth in the Canadian Maritime Provinces, and in the U.S. North-east,” stated Steve Ekstein, Executive Vice-President of Weston Forest Products. “We are very happy to welcome Agnes to the Weston team.”

Agnes will be based in Halifax, Nova Scotia and may be reached at 902-860-8551 or email aflinn@westonforestproducts.com.

Weston Forest Products is pleased to announce that David Steinman has joined Weston’s North American Sales group as a lumber trader.  David comes to Weston after serving at Grant Forest Products as a Sales Representative / Commodity Trader.

We wish David great success.

Longtime NAWLA member and industry friend Milton Larimore Sandy, Sr., 92, died at home February 1, 2009 following a brief illness.

Born February 29, 1916 in Dennis, Mississippi, Mr. Sandy was the fourth of five children of the Reverend and Mrs. William Henry Sandy.  He delighted in saying he was only twenty-three years old.  Mr. Sandy liked to shared stories of a childhood where material possessions were few yet very rich in memories.  The terrain around his home was apparently unusual in that he “had to walk two miles to school, uphill both ways.”

Mr. Sandy began his lumber industry career by working for Richard G. Swartz, owner of the Corinth Lumber Mill.  While working there he developed a love for the lumber industry which endured for a lifetime.  

Mr. Sandy purchased the mill from his employer and it became Corinth Planing Mill Co., Inc.  In 1957 he founded M. L. Sandy Lumber Sales Co., Inc., a wholesale distributor of lumber and building materials.  Sandy Lumber Sales grew to over 250 employees with warehouse locations in Mississippi, Arkansas, Tennessee, Alabama and Georgia.

Mr. Sandy was an active member of many trade organizations including NAWLA, SFPA, Mississippi Lumber Manufacturers Association, Tennessee Lumber Dealers Association, and HOO-HOO International.   He served on many committees and believed in the benefits of trade associations. 

Mr. Sandy was widely known and respected in the lumber industry for his affable personality. He was active in his business until 2006 when, at the age of 90, he decided to “slow down”.

Our thoughts and prayers go to the Sandy family.

Due to economic conditions, North Pacific announces the closure of its Napa, California distribution center, effective immediately. Lumber and panel products will continue to be distributed into the Northern California market from North Pacific’s trading office in Portland, Oregon.

“I understand the huge impact this closure has on the employees of our Napa operation and their families,” says Jay Ross, President & CEO. “These are highly valuable professionals who have remained loyal to North Pacific and committed to servicing their customers during a very difficult time. I cannot thank them enough for their contributions over the years.”

North Pacific will continue to operate its Sacramento and Southern California distribution centers. Many of the assets in Napa’s operations will likely be acquired by other distributors in the area.

As FSC-certified flooring becomes more affordable, demand for the product is expected to more than triple by 2013, according to a report from the Freedonia Group. Overall, demand for green floor coverings (including bamboo, cork and FSC-certified flooring, along with low-VOC carpeting) is expected to increase 5.6 percent by 2013, according to the report. The report, Green Building Materials, is available for $4,700. For more information, call 440-684-9600, fax 440-646-0484, e-mail pr@freedoniagroup.com, or visit www.fredoniagroup.com

On November 26, 2008 the Department of Homeland Security published a regulation governing security in the freight rail industry. The regulation not only affects freight railroads but their customers as well. Shippers and certain receivers of rail security-sensitive materials are covered in this regulation. All of the provisions of the regulation will be effective April 1, 2009.

The Transportation Security Administration will offer a one-day workshops and will provide the participants with a detailed overview of the Rail Security Rule and information to assist in meeting the requirements of the regulation.

Topics to be covered include:

1. What’s covered in the rule
2. Frequently Asked Wuestions about the rule
3. Using Sensitive Security Information
4. Rail Security Coordinator tools of the trade
5. TSA Inspections: What to expect from the inspector

Workshops will be held March 10 in Los Angeles, March 17 in Chicago, March 31 in Philadelphia.

To register for one of the workshops, send an RSVP to freightrailsecurity@dhs.gov with your name, title, organization, contact information and which workshop you will attend.

Adam J. Fein, Ph.D. of Pembroke Consulting discusses the affects of the economic stimulus bill on wholesale distribution. He notes that President Barack Obama signed the American Recovery and Reinvestment Act of 2009 into law. This economic stimulus bill provides $787 billion in tax cuts and spending between 2009 and 2019.

Our research finds that 72 percent of executives at wholesale distribution, manufacturing, and technology companies expect the economic stimulus bill to have no impact on their company's business strategies in 2009. Surprisingly, twenty-one percent of executives claim that the economic stimulus now makes it less likely for their companies to invest in growth-oriented strategies! 

Click here to download this special report

Fein states, “Personally, I’m surprised that so few companies are investing to capture their share of the stimulus spending. Our analyses of the legislation suggest that many distributors could directly benefit from the spending provisions in the economic stimulus act.”

Join Dr. Fein on March 26 for a special live webcast and find out what the stimulus really means:

The Economic Stimulus Package:
Impacts & Opportunities for Distributors

With a recession in full-swing, now's the time for leaders to reevaluate and invest in their organization's employees and future.

It seems like we've been preparing for this current recession for the past two or three years, constantly predicting it and staving it off as long as we could, all the while listening to the media tell us that it was just around the corner. And now that it is here—and it is here—we're witnessing a new media-inspired cottage industry building up around the "down economy" and the bad times that are upon us.

Every news story seems to have the addendum "in a bad economy" attached to it. I suspect that soon there will be a new "Recession Barbie" doll on toy store shelves, complete with a frown on her face and a copy of the job listings from the newspaper in her hands.

Well, so far I've resisted jumping onto the "down economy" bandwagon, not wanting to contribute to any self-fulfilling prophecy or culture of victimization that can make a bad situation worse. But after numerous requests, I've agreed to share my own perspectives about how leaders can survive and even thrive during difficult times.

Leadership Survival Tactics

The first thing we have to do is ask ourselves a fundamental question: Do we believe things will get better? If we don't, if we believe this is the definitive end to any upside in the economy and that it's all downhill from here, then I'm afraid I have no good advice. Aside from moving somewhere that does have an economic upside.

But most of us would admit that this, too, will rebound. Maybe not the same way it has in the past. After all, there are some fundamental problems that we haven't yet faced. But even in the absence of that, there is a good chance that we will experience an economic upturn sometime in the not-too-too-distant future. And if that is the case, our call to action is clear: use this time to invest in your organization's future, especially when the investment is not a financial one.

The best place for an investment right now is in the general health of an organization. I'm talking mostly about improving the functioning of the executive team, and their clarification of and recommitment to the organization's values and purpose. Doing this will require a little time and energy but very little money. And it will yield significant returns now and even more when the economy rebounds. How?

A wise executive team will take this opportunity during slow times to build greater trust and behavioral cohesiveness. This will benefit the organization by minimizing politics and infighting, that are common during difficult times, and it will allow the team to make better decisions about which programs and employees need to be retained and which shouldn't. All of this will allow the organization to emerge stronger than ever when the economy turns around, and with a meaningful advantage over competitors.

That's because most of those competitors will probably flail during down times, frantically searching for a tactical way to swim upstream and defy the current, leading to even more frustration and angst than is necessary. In the end they'll simply be more weary and scarred and unprepared.

Of course, like so much of the advice that people are repositioning these days for a "down economy," none of this is really new. Even during good times leaders should be investing in the health of their teams. But with so many shiny opportunities in front of them, they often fail to slow down and do what it is best for the long term. Now that there are fewer and fewer of those shiny opportunities, there is no good excuse. And that may turn out to be a good thing.

Source: NAW SmartBrief
By Patrick Lencioni, Manage Smarter: www.managesmarter.com

By Herb Greenberg, Ph.D., Founder & CEO of Caliper

Every leader knows that surrounding yourself with the right people is one of the most important parts of running a successful business, especially as times become more difficult. Companies are looking to cut back in every way imaginable. Competition is fiercer than ever, as products are being duplicated and promoted at lower costs.   

So what differentiates you from the competition? Why should a customer go with Company A versus Company B? The answer is … it’s about the people you have on board. They are your differentiators. So now is the time to make an investment in the people who will pull you through this difficult time.

The following model outlines a step-by-step approach to investing in your people. Using these tactics, you can learn to boost your top performers to higher levels of accomplishment, as well as tackle the most troublesome performance issues.

Whether gearing up for performance reviews or engaging in the daily mentoring process, learning to be an effective coach is a critical task most effective leaders consider one of their main objectives. But successful coaching is not always an easy assignment, nor is it a process to approach haphazardly. To be effective requires foresight, planning and commitment.

The following model outlines a step-by-step approach to better coaching. Using these tactics, you can learn to boost your top performers to higher levels of accomplishment, as well as tackle the most troublesome performance issues.

Planning For Productive Coaching

There are three major stages to effective coaching; the planning stage in which managers must familiarize themselves with the issues and prepare a course of action; the coaching stage in which leaders must take action; and the third stage, the review and follow-up stage in which the manager must ensure that any corrective measures were effective and any rewards adequate.

In the planning stage, your first course of action is to gather information. To be a successful coach you must be well informed. This includes documenting and investigating sources of information such as the employee’s work history, relevant input from co-workers, clients or customers, and personal observations. This stage also includes documenting any standards of expectation relating to the work or employee’s performance.

Once this information is gathered, a coach must then decide whether the employee’s performance meets, exceeds or falls short of expectations. The next step of the planning stage requires coaches to assess the individual’s performance, and consider these three questions:

• What is the likely future for this employee? Does his or her performance merit promotion? Will the person likely stay at the same level? Or is the individual facing probable termination?

• What is your coaching objective?  To consider other opportunities or expanded responsibilities for top performers? To improve mediocre performance? To gain commitment and save a struggling employee?

• Which coaching strategy should be used? Corrective coaching to address performance issues? Developmental Coaching to encourage higher levels of productivity?

In addition, other mitigating factors need to be considered. External influences such as competing priorities might be contributing to the problem, or a possible knowledge or skill deficiency might be causing performance issues.

The problem could be with the structure or nature of the work itself. For example, standards or quotas that are too high cause frustration and undue stress, while low standards can haunt achievers, producing little challenge to top performers and encouraging sub-standard employees to “aim low.”

The Coaching Discussion

Called a “discussion” to highlight the interactive nature of this dialogue between coach and employee, the coaching session should be an open exchange, never a one-sided confrontation. But, before entering in to this dialogue, coaches should first consider three things. One, is the encounter really important? If the answer is “no” and the performance problem is a minor infraction or the result of a one-time insignificant breech of conduct, it may not be in your best interest to make a mountain out of a mole hill. On the other hand, if the answer is “yes,” or the behavior indicates a pattern of misconduct, coaches should consider the following issues.

In determining the proper coaching approach, managers must consider possible performance inhibitors which may be out of the employee’s control such as ignorance to certain expectations or requirements, obstacles to performance, inadvertently punishing good behavior or non-performance being rewarded.

Also, coaches should consider the “fit factors” such as whether or not the employee “can do” the work, meaning they are appropriately trained and qualified, or whether or not the employee “will do” the work, meaning they are properly motivated to do the work. If motivation is an issue, coaches need to consider their own part in providing proper motivation before addressing any problem issues. Has management provided adequate training, motivation or encouragement to this employee?

Considering all these factors, the coach must now determine whether the interaction with the employee will be corrective or developmental. In a developmental session, coaches give positive feedback and discuss expectations for the future. In corrective situations, coaches provide constructive feedback, address performance problems, elicit reactions and causes, and discuss required behavioral changes.

Whether developmental or corrective, there are basic guidelines to conducting an effective session and those standards include; setting a productive climate; identifying an expected outcome; providing feedback -- either positive or constructive; discussing any relevant behaviors or changes required; mutually developing a plan for improvement; and perhaps most importantly, providing support and follow-up.

To set a productive climate, coaches should address behavior, not other issues such as personality. Coaches should be direct, but not confrontational. Remember the best leaders know that the overall objective is, even in cases where termination is probable, to help the employee change and grow.

Identifying an expected outcome gives direction to your encounter. It targets behavioral expectations and sets reasonable and achievable parameters for development.

Providing feedback, whether positive or constructive, seems to be one of the most difficult areas for coaches. Although this step may be challenging, the simple formula for providing constructive feedback is to describe the behavior, describe the impact of that behavior, ask for alternatives to that behavior, decide on a plan and provide support.

Coaches should then discuss behavior with the employee. In the case of good performers, coaches should review past performance, and discuss possible motivators which may encourage even better performance. In the case of poor producers, discuss past performance issues and any required behavioral changes.

Following this, a mutually designed development plan needs to be set into motion. Most importantly, this step must be the result of cooperative effort between the coach and the employee. Mutual involvement serves to establish “buy-in” which reinforces the employee’s commitment.

Although often neglected, perhaps the most important stage is the review and follow-up. If you’ve committed yourself to taking actions to support the changes agreed on, you must follow through with these commitments. This could include scheduling the employee for related training or taking steps to ensure the development plan is put into motion. Neglect at this stage sends a clear message to employees that performance issues are not taken seriously. Coaches need to monitor results through a review process. During this stage, coaches must ensure that corrective measures were adequate and incentives appropriate. If the results are not what were expected, the planning and coaching stages must be revisited.

Again, while productive coaching may not be easy for every leader, it is a critical role every leader must assume. Making an investment to develop your top performers will not only bring you a substantial return, but it will also put you in a position to grow and outlast your competitors.

Terry – Please place the paragraph below along with the attached graphic as a sponsorship of the Bulletin along with the below paragraph on the Right side box on the Bulletin cover and in the article.
Thanks,

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How do you identify a member of your management team that just doesn’t get it when it comes to getting their employees to release their discretionary energy that is critical to success especially during the turbulent times we are facing in 2009?

Sometimes these individuals that don’t get it exist simply because they have been around a long time. I often have CEOs tell me about problems with specific managers that aren’t promoting the vision, values or core principles of the company. The majority of the time these managers have been around a long time.

Guess what, that means the CEO just hasn’t done his job. It’s their fault if they accept sub standard performance that impacts cultural success even if financial success in some portion can be attributed to these managers. It may very well be that their success contributions come at the expense of -- or on the backs of their employees. Their success is often short term or they may be getting credit when in fact they could be hindering maximizing the success of the organization. Let’s look at some detrimental habits of these types of leaders.

They see themselves and their companies as dominating their environment and become complacent

• They have a tendency to put personal needs ahead of business needs
• They think they have all the answers
• They ruthlessly eliminate anyone who isn't 100% behind them
• Their egos drive their decision making often becoming more concerned with image than reality
• They underestimate obstacles and often play the blame game
• They stubbornly rely on what worked for them in the past and are not open to new ideas. They don’t listen well and they lack faith in the ability of their employees
• They claim they empower but often just delegate with excessive control
• They are considered micro managers by many employees
• They believe they are untouchable due to their tenure or relationship with the CEO

Employees Often Recognize Incompetence Before You Do

I recently worked with a CEO that struggled for weeks with my recommendation to terminate one of his key executive team members. He agonized so much over this decision that he actually made himself sick. He analyzed the facts typically the way many of us do when we are faced with a situation that involves an employee that has been around a long time. Most of that analysis has a tendency to highlight how long a person has been with the company, exaggerate their individual contributions and gives them credit for success that was actually created by someone else. We often ignore the morale impact this person generates. We ignore the complaints and remarks that come from employees about how they are treated and we may even cover-up some of the mistakes made by this individual. This can even get more complicated if this long tenured employee happens to be a family member of ownership.

Trust me; if you have a manager/leader (I use the term Leader facetiously) that fits this description, your employees have known it for a long time. In fact you may have lost some good employees as a result. Those that stay working for this type of individual may have a tendency to shut down and function in a coping manner in order to tolerate this individual’s leadership style. At the very least they do not release their discretionary energy in support of company growth. Discretionary energy is the energy an employee gives without being asked. It is the difference between ordinary & extraordinary performance. It’s meeting the call and challenge when faced with a crisis with little or no direction. It means an employee goes beyond the call of duty. You can’t demand it. It is only given willingly under the right kind of culture – the right kind of leadership.

The Employees Will Cheer

When this CEO finally made the decision to let this employee go, (in a very ethical fashion with a nice severance package), the employees cheered the decision. The comments heard exclusively around the company were…

“What took him so long?” “This should have been done years ago.”

This decision created an instantaneous morale boost in the departments managed by this individual that was blatantly obvious. True leaders inspire others to greatness. In spite of what may seem the contrary, being a true leader in times of sacrifice and turbulence is even more important than in normal times?

A Cohesive Mgt Team

So how does an effective leader balance compassion with performance and accountability? A leader must demonstrate the need for maximizing performance to the team. This is communicated more by action than words. Tolerance for the lack of excellence or subpar performance sends a distinct message; the wrong message. A cohesive management team is probably the most critical element required to deal with economic crisis and market turbulence.

There is a lot of talk about leadership development but very little specific leadership skill training is available. It seems like success is dependent upon surrounding yourself with the right people and hoping they have the skills necessary to do the job. Compassion often prevents us from replacing those that don’t have the skills in a timely fashion and very little coaching and mentoring support is available within the company.

A sad commentary considering that team building and teamwork skills are critical to the effectiveness of the management team and the company as a whole. Success of your management team should be defined by what they accomplish as a group. A synergy within the team that creates unity, clarity of direction with a common purpose that is in alignment with strategic initiatives. This is the first prerequisite for your management team when faced with the kind of economic crisis we all face in 2009 & 2010.  A common purpose and crystal clarity of goals and objectives are essential. Evaluate your team based on the following characteristics of an effective team.

• A group of people sharing a common goal working together to produce outstanding results
• A cohesive group that takes responsibility for their output while acting responsibly to deal with obstacles standing in their way
• An energetic group of people who are committed to common objectives who work well together
• A group that welcomes both individual and team accountability. The attitude of “Give Me the Ball Coach”
• A group that embraces empowerment and believes in their employees because they have selected the best and surgically removed those that didn’t perform.
• A group that has been trained and demonstrates effective coaching skills.

Successful leaders understand the importance of making emotional connections with the management team that surrounds them. They must encourage these people to open up, share dialog and reveal dreams. They must teach and mentor. A good leader recognizes leadership incompetence and is not intimidated by the successful leadership of others. They encourage others to succeed and help them fulfill their wants and needs while at the same time they are willing to “weed the garden” and eliminate incompetence. Effective leaders have high questioning and prospering skills that allow them to drill down to real facts and issues.

Source: Dr. Rick Johnson
CEO Strategist

Check out CEO Strategists
http://www.ceostrategist.com/resources-store/real-world-leadership.html

It is clear that social networks and related platforms are making an ever-bigger impact in the enterprise. Companies using these approaches, however, should be crystal clear about one thing: Employing blogs, Facebook, Twitter or any of the myriad other social media tools in a business scenario is significantly different than consumer use.

Much flows from that one statement. Unlike the freeform use by teenagers – and, increasingly, us electronic village elders – corporate social media initiatives must be carefully researched, secured, measured and managed.

This useful No Jitter piece starts with the important context that corporate use of social media long predates today’s initiatives. It goes back to forums and bulletin boards – and anything else that is predicated on creating interactive communications with customers, prospects, partners, vendors and others.

The writer, Martha Young, is the founder and principal of Nova Amber. She looks at some properties of “outward-facing social media,” including creation of a corporate voice, its role in running campaigns and the ongoing leveraging of company loyalists. Young writes that there are dozens of platforms available, and implementing one can have the double benefit of improving customer service and cutting costs. The end of the piece offers an extensive description of corporate social media best practices.

A tremendous amount of information about social media is floating around the Internet and elsewhere. Some of it is true; much isn’t. This very good BusinessWeek piece looks at six misconceptions about corporate use of social networks and, in the process, provides a tremendous amount of valuable data. The writer says the misconceptions are that social media is cheap or free; that anybody can execute a plan; that it is easy to generate a lot of attention in a short time; that a social-networking initiative generally can be done in-house; that people will automatically find good content and that it is impossible to measure results.

WebWorkersDaily expands on one of the issues mentioned by Young
 The number of people who position themselves as social media experts will grow in proportion to the number that have a rudimentary knowledge of these platforms and to the slump in the economy. The piece describes what to discount and what to look for in a perspective consultant. Pay no heed to such things as how many personal Facebook friends or Twitter followers a candidate has, unless they are business connections. Look for relevant past experience and whether the person operates in a manner consistent with the way the business should be represented.

Twitter, the hot social-networking service of the moment, lets people post messages of 140 characters to their “followers.” A Forbes contributor, a Twitter-resistor who finally decided to see what all the fuss was about, provides two examples of executives who are leveraging the platform: The CEO of the Zappos shoe site has more than 55,000 followers and the head of social media at Ford has 10,000. What the writer found was a great way to build brand loyalty, create a closer relationship with customers and prospects and in other ways do what advertising and marketing is intended to do: Break through the barrier between the company and those it seeks to influence.

First, do no harm. The bookend to finding better ways to exploit social networks is ensuring that they do not damage the company’s reputation, endanger its security or otherwise cause problems. Daniel Hoang says companies should set formal policies and procedures on social media and networks. He adds that proper disclaimers should be included and offers examples of suggested policies. The post itself is good, and is followed by links to company policies employed by IBM, Sun, Harvard Law and Ernst & Young for its Facebook page. Finally, Hoang offers four other sources on creating social media policies.

Any company that doesn’t think social networking is a corporate tool is missing a big opportunity. Indeed, it may be playing with its very future because the differences between success and failure – especially in the current economic climate – is thin. Social networking may have come of age due to its use by teenagers, but companies must be far more careful about its implementation.

Source: IT Business Edge
by Carl Weinschenk
Website: itbusinessedge.com

Is it an unrealistic ideal in the current business climate?
Yet another survey on employee engagement (available with registration) was published in December last year, by YouGov commissioned by Engage Group). Polling 23,600 directors, managers, and employees, they found that employee engagement is seen as one of the top three factors that drive an organization’s success (it ranks higher than strategy) and 75% of board members believe that it improves bottom-line performance. In these times, when the news is full of redundancies (layoffs), re-organizations, and failing businesses, I’m not sure if employee engagement is high on the business agenda.

I believe it should be; the constant changes in these potentially traumatic business conditions are forcing businesses to constantly review and change how they organize themselves to be more innovative, productive, and customer-focused—in both the products they make and the services they offer. Becoming innovative and productive relies on having the right people engaged with what the organization is aiming to deliver; with the capability and freedom to anticipate and respond to changing market requirements. These times are uncertain; engaged employees are more likely to not only cope with the changes, but also to contribute to how the business can survive (and maybe thrive).

It seems to me that, although we must pay attention to those people who are losing their jobs, we must also pay attention to the people who are staying in the business. Even before the current economic conditions hit, we found it difficult to "engage" employees; surveys reveal that only about one-fourth of the workforce is engaged and about the same amount are actively disengaged.

In my work I have seen pockets of excellence where employee engagement seems to be occurring, and many places where it is obviously not! I have been asking questions about what is happening where engagement is prevalent. A pattern appears to be taking shape in the responses I get; engagement is more likely to occur when managers purposefully include, and share power with, people within the organization, co-creating a way of working together with their teams. There is a sense that the diverse range of people within the workplace community (not just the managers and leaders) are involved in, and feel accountable for, finding the solutions that are right for them, the business, and the future.

Is employee engagement seen as a priority in your organization? And, if it is, how are you going about creating an environment that encourages engaged employees?

[Ruth Smith is a consultant working with Tom Peters Company in the UK (you guessed that from her spelling), and she's contributing to the blog for the first time. Welcome, Ruth!—CM]

Source: www.tompeters.com