Business Management Blog

Many organizations are trying to put different labels on measures that look for knowledge or skill-gain, believing that the word test may sound unprofessional, particularly for management personnel. For the purpose of this discussion, the word test is used because it is the word that is most commonly used throughout this country and others. The tests that most are familiar with are those that measure knowledge-gain. Following are general guidelines Dixon (1990) offers for constructing knowledge-based test questions or items. Read the rest of this entry »

A 401(k) plan is a savings plan that allows you to divert a portion of your income into a tax-sheltered savings account, which accumulates without your having to pay income taxes on it.

This program falls into the defined contribution retirement category because the law defines, or limits, how much you can contribute to your 401(k) plan as a percentage of your income. The plan sponsor — your employer — must make sure your contributions comply with the law and the specific plan. In 1999, for example, the maximum amount you were allowed to defer from your income for the 401(k) plan was $10,000 or 25 percent of your pay, whichever is less, per year.

Some employers encourage you to participate in the plan by matching a part of your contributions, usually as a flat amount of, say, 25 cents for each $1 you contribute. An employer’s match isn’t taxable to you as current income, and the government allows earnings on this match to accumulate tax-deferred. Read the rest of this entry »

According to Roslender and Fincham (2001), intellectual capital is currently the focus of significant discussion and enquiry across the management disciplines and beyond. This reflects the recognition that intellectual capital provides a crucial source of value for the contemporary business enterprise. It is a resource that requires careful management if it is to fulfill its maximum potential.

In the case of those businesses whose shares are publicly quoted, the success with which organizations manage their intellectual capital is increasingly mirrored in their market values, values that are often many times the book values of enterprises. Bridging the gap between these two values provides one motivation for seeking to account for intellectual capital.

Another motivation for seeking to account for intellectual capital is the need to manage intellectual capital successfully. Given the importance of managing intellectual capital successfully, accounting is being challenged to develop new approaches to performance measurement that capture the quality of management evident in the context of intellectual capital. Read the rest of this entry »

Despite what some people believe, a cluttered desk does not indicate genius. Au contraire! It signals confusion and creates stress. Even mini-clutter will grow and eventually fill every inch. Keep your desk clear of everything except your project du jour and your family picture.

Get rid of that paper! Shuffling and reshuffling paper from pile to pile or file to file wastes time and keeps you from focusing on what needs to get done. Find a gigantic wastebasket and fill it up. The larger the wastebasket, the more you will use it. Throwing things away then becomes an art.

Enjoy! Files should not be an obstacle course. Put your most often reviewed files at the front of the cabinet. Here is a test to see if your current filing system works. Within two minutes, can you retrieve any paper you need? Go. If you failed the test you are wasting time searching through your files. Read the rest of this entry »

Fess up, fellows: The masters of the universe have turned out to be masters of disaster. No matter which aspect of the financial crisis you consider, there is a man behind it.

So, it is worth pointing out how different things might be if the financial world were female.

Finance professors Brad Barber and Terrance Odean have found that women’s risk-adjusted returns beat those of men by an average of about one percentage point annually. In short, women trade less frequently, hold less volatile portfolios and expect lower returns than men do. Read the rest of this entry »

How do you buy a carpet? Although it is a common and simple question, there is no single answer for it. Area rugs add beauty and style, charm and elegance, personality and pride to any home. There’s a lot to know and consider before buying your new area rug but it’s well worth the effort.

The first thing to do is decide how much money you are willing to spend on purchasing a rug. Then take a tape measure and define the width and length of the area where you are planning to put your carpet.

Secondly, shop for the one that matches yours. Style can be defined as the way different motifs, colors and patterns give character to a rug. Styles range from floral to contemporary to traditional. They can also reflect a season or a theme. Roll out your favorite. Read the rest of this entry »

You have successfully started your small business and consistently maintained hefty profit. Yet, you might don’t even think about potential incidents that could happen in the future. Regardless of location, your business may be vulnerable. Burglary, robbery, and theft are some of the greatest sources of crime losses for businesses.

Every year a large number of companies are put to enormous expense due to destroyed or lost information and stolen cash and valuables caused by burglaries and robberies. For example, a single bomb in St Mary’s Axe in London in April 1992 caused damage amounting to approximately £1.5 billion and forced 40 companies to relocate to alternative premises. How would your organization cope with such incident? Read the rest of this entry »

Finding the most effective way to brainstorm is easier once you figure out what you want to get out of the process. In particular, there are structural differences between the kind of brainstorming session that will generate one great idea and the type that will produce several above-average concepts, according to a new study.

The study’s findings are described in a working paper, titled Idea Generation and the Quality of the Best Idea, coauthored by Karan Girotra, Christian Terwiesch, and Karl T. Ulrich. “The front end of the ideation stage is very important,” notes Girotra. “But companies are not as structured or as rigorous about this phase of the research and development process. Management tends to focus its attention on the later stages.” Those later stages are indeed critical — and expensive — but managers needn’t risk getting that far with a subpar idea. No matter how well conducted the back end of the innovation process may be, it cannot elevate a fundamentally low-quality idea. Read the rest of this entry »

It’s a mad, mad, mad, mad world on Wall Street these days, and unless you’ve been buried under a veritable avalanche of rock for the last several months, you’re undoubtedly painfully aware of just how much damage has been wrought in the equity markets.

To put that damage into perspective, let’s look at a few vital statistics. Over the 12-month period from October 10, 2007 to October 10, 2008, the S&P 500 index plunged 43%. Foreign markets, as measured by the EAFE Index, sank 48%. Investment interest rates on the 10-year Treasury note dropped from 4.65% to 3.86%. Real estate/housing prices were down 9% nationwide and 11% in Arizona. Oil prices surged 25%, while blue chip stalwarts like Ford and General Motors shares plummeted 76%, and 87%, respectively.

Widespread consolidation and outright bankruptcies amongst big financial firms like Countrywide, Bear Stearns, Merrill Lynch, and Lehman Brothers have effectively remapped the entire banking landscape. And of course, we have yet to begin assessing the aftereffects of the federal government’s trillion-dollar bailout package. Understandably, many investors are now wondering what to do and how they can stay ahead amidst this market descent.

So, what’s a savvy investor to do? Read the rest of this entry »

We can learn a great deal from organizations whose strong and adaptive ownership cultures give them a powerful competitive edge. Here are our top 10 lessons.

1. Leadership is critical in codifying and maintaining an organizational purpose, values, and vision. Leaders must set the example by living the elements of culture: values, behaviors, measures, and actions. Values are meaningless without the other elements.

2. Like anything worthwhile, culture is something in which you invest. An organization’s norms and values aren’t formed through speeches but through actions and team learning. Strong cultures have teeth. They are much more than slogans and empty promises. Some organizations choose to part ways with those who do not manage according to the values and behaviors that other employees embrace. Others accomplish the same objective more positively. Read the rest of this entry »