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Thursday, September 17, 2009

Take a Big, Deep Breath...

I've been all over the corporate office building and burning up email in the last few days. My level of activity has apparently raised alarm in places because we've had several quietly asked questions lately along the lines of, "What's going on?"

Here's the skinny. Amy in Benefits is out on maternity leave (expected back Monday) and HR Manager Jack is in-and-out on Jury Duty until October 8th (thanks a lot, Smyrna). The HR Department most days is Dawn, Elaine, and me. Factor in lunch hours, days off, sick kids, Elaine's new grand baby and Jack's anticipated grand babies (arriving Friday) and we're operating with two people a lot of the time. You're seeing me because you're most likely not seeing anyone else from HR.

Mystery solved! To quote Chevy Chase, "Sometimes a banana is just a banana."


Tuesday, September 15, 2009

401(k) Catch-Up Contributions

I learned something today that should be passed along to our Nelson team, especially those 55 and older or who will turn 55 in the near future. The IRS guidelines allow maximum contributions up to $16,500 per year. This "maximum contribution limit" changes almost every year and is a feature in the law that prevents 401(k) plans from becoming a wealth building tool for executives rather than a retirement plan for all employees.

If you're 55 and over you can also make additional annual deferrals known as "catch-up contributions." This feature allows older workers who may be behind in their retirement savings to contribute up to an additional $6,000 per year.

In our plan, and most plans, the methodology for maximizing your contributions was cumbersome. You had to separately elect catch-up contributions. Then as Plan Administrators we had to wait until you had contributed your $16,500 maximum before directing the Record Keeper to accept your additional payroll deductions as catch-up contributions.

I learned today that, among many technological advantages to or new Vanguard 401(k) arrangement, their system is smart enough to do all this for you. If you are 55 or older and have deferred a percentage of your salary that will exceed $16,500 annually the Vanguard system will automatically take all contributions after that point and consider them as catch-up. The system will then accept contributions up to $22,500 ($16,500 + $6,000) before stopping your deferrals.

As you plan for your retirement and consider accelerating your contributions, you can defer whatever flat percent of your base pay that will lead you to $22,500 and the Vanguard system will take care of the rest. Its one more reason that, at this early stage, I'm a happy Vanguard customer.


Saturday, September 12, 2009

I'll Take Care of That For You

In an recent conversation, just as a throwaway comment, our Live Events COO Vance Lawson quoted Zig Ziglar (paraphrasing here) that, "The world still opens up for people who say, "I'll take care of that for you"." I hadn't heard that in awhile, but it precisely sums up what I'm seeing and experiencing in this economy. The rules have changed and your policies no longer matter. What matters in chasing the fewer consumer dollars out there is doing what it takes to be of service to the customer and your employer.

Simultaneously I'm overseeing three departments and rebuilding two boats. I see every day at work those who struggle and those who succeed with the tougher work loads. Off work, I'm spending my own scarce capital in the final stages of these two projects the type of which I never thought I'd do. In both the corporate and personal situations the demarcation of success is not necessarily the number of hours being worked, but the attitude of those doing the work. If you recognize that everything has changed and you've adjusted accordingly, you're hanging in there pretty well. If your instincts are bad and you're still working and doing business like you always have, you're struggling.

In the economy of 18 months ago there was room for quoting policy to your customers; dictating to them the product quality and pricing which you want them to have. I have blogged before about sales people who want to sell me what and how they wish rather than selling what I want at the price I want to pay. Before I was the exception and now I'm the rule. The corporate employees who are doing well are showing creativity and resolve and developing new products, new ways and places to sell those products and ways to control or reduce the cost of product. Those who aren't are struggling.

In my boat world I took my dad's miniature pontoon to a local dealer for what I thought was going to be a $1,500 quote for a refurb. What I got back was a $6,000 "best case" bid. Now since I'm cheap and going in for half of those cost (and a share of the boat) there was no way six grand was happening. I challenged the dealer and got, "That's how we do it because that's what it takes to get it right." I told him $2,500 was our max (since half of that was coming out of my pocket) and how could we economize to hit that number. He was having none of it.

Later that night I sat down and planned out a project schedule of everything that needed to be done, and hit Craigslist. Over the next two weeks I screened independent handymen and mechanics, many of whom had lost their day jobs and started their own businesses out of necessity. I had to kiss a couple of frogs before finding the Princes, but I settled on two handymen and one mechanic. All three had, coincidentally, the Zig Ziglar response to everything I asked; "I can take care of that for you."

Labor Day evening we water tested the pontoon on Old Hickory, then took it over to Percy Priest and launched it at Four Corners Marina. On Thursday I took a PTO day and took my dad fishing on Priest for his first time on that lake without a guide since the 1960s. Total price tag, $2,650 against a $2,500 budget.

Trailering the boat to Priest from my home I passed by the $6,000 dealership and waved. That guy could have had my money and I would have been in the water in July if he'd tried creatively to solve my problem (old boat, limited funds) instead of quoting his policies. He didn't realize that the ground had shifted beneath his feet; that his competition was no longer just the other dealers in the lake area. It now includes a large number of skilled trademen-turned-entrepreneurs launched by the recession.

In the corporate world the competition for sales is no longer between big businesses, but now includes the array entrepreneurs working from home and similarly "inspired" by corporate downsizing. Similarly the competition for jobs is not just between you and the others at work who do your job, but includes the many, many good people wanting to get back into the workplace.

So for now and the foreseeable future, possibly a half dozen years to come, quoting policy and dictating price is old news and a remedy for failure. The path to survival and success is listening to your customer, caring about their needs, and finding a way to use the resources at your disposal to solve their problems. It actually always has been the recipe for success albeit forgotten in the boom economy.

Oh, and another thing about satisfied customers is that they tell other people and help make new customers. If you need good handymen, a great marina, or an outstanding mechanic I am glad to pass those along off-line if you'll drop me an email.