Category: Business

Healthcare Reform…Trick or Treat??

On By Joe DeRosaIn BusinessLeave a comment

The closer we get to 2014 the more scary things look for healthcare reform.  We’re about to walk through the cracked doorway of a dark room not knowing what’s inside.  The music is building, the suspense reaching new heights.  Just like in the movies we don’t yet know what’s in that dark room.  It could be nothing, it could be something that imposes a greater fear than we ever expected.  Think of the first time you saw Michael Myers in Halloween.  Before anything bad ever happened in the movie you were left with an eerie and unsettled feeling that there was an impending doom on its way.

Regardless if you own your own business, work for a small company with less than 50 employees, or work for a colossal employer with tens of thousands of employees, the Affordable Care Act will have an effect on you and your family.  The type of policy you have, the premiums you pay, the contributions made on your behalf by your employer most likely will change.  The reality is that we just don’t know how much will change.  It is this not-knowing that creates the same anxiety we feel as we watched The Shape appear behind Jamie Lee Curtis‘ character Laurie for the first time in Halloween.  While we didn’t know for sure what would happen next we knew that whatever it was wouldn’t be good.  And we were right.

Many people believe that all of Healthcare Reform has been postponed until 2015.  This is incorrect.  What’s been postponed is a piece of the Act that mandates businesses with more than 50 full time equivalent employees to provide health coverage if they don’t currently offer it.  This roller coaster ride between the current Obama Administration and GOP-led House raise concerns, questions, and anxiety levels, while diminishing overall trust in the U.S. Government.  Republican or Democrat, Congress’ approval rating sits at an all-time low of 17%.  CBS News has gone as far as labeling this 113th Congress as being the “least productive in history”.

Just like Laurie in Halloween we’re left wondering what we will encounter when we get through that door.  The questions still on the table include:

  1. How much more will insurance cost me and my family once all the pieces of the Affordable Care Act go into place?
  2. Will my employer stop offering coverage entirely and pay the fine because it’s cheaper than providing insurance coverage?
  3. What happens to the quality of my healthcare as we layer on another 35 – 45 million people to the current health system infrastructure?
  4. Will there be doctor shortages in the U.S. as seen in many European countries?

In a previous presentation put on by the NFIB stated that every business owner would need to have an accountant, broker, and attorney to help them sort through what the Affordable Care Act meant for their specific business.  Given the vastness of this Act, and the number of different areas affected by this legislation, it’s perhaps impossible for any one person or adviser to know everything.

To give yourself some peace of mind I’d suggest finding a few trusted partners who can assess your specific situation and provide feedback and guidance tailored to your specific circumstance.  Be wary of those dispensing a general prescription for your business relative to Healthcare Reform.  Remember every business is different as are their employees.  Add to that the fact that every business has been handling health coverage differently making their specific employee situations just as different.  A one-size fits all approach will not work and may even lead to significant business failures.

Invest the time you need to educate yourself.  Turn the lights on before going into that room, as it may make things less scary when you finally encounter them.  And finally surround yourself with trusted advisors that can provide guidance and confidence as you make these important decisions that will most certainly affect you, your business, your employees, and their families.  This is one of those rare moments in history when we’re faced with one piece of legislation that will impact everyone in so many different ways.

How difficult is it to change your brand promise?

On By Joe DeRosaIn Business, MarketingLeave a comment

promise

A discussion around a brand promise makes for a spirited conversation.  Outside of Marketing professionals, the concept of a brand promise is new, or at least a new way to describe what your brand means and represents.  To understand what a brand promise is, let’s look at what the two terms mean by themselves.

What is a brand?  A brand is commonly defined as a name, term, design, symbol, or any other feature that identifies one seller’s product distinct from those of other sellers.  Basically the name you’ve attached to your business as the producer of the product or service you sell.

What is a promise?  A promise is a declaration assuring that one will or will not do something; a vow.  This is your commitment to follow through as you said you would.  Say what you do, and do what you say.

When combined together, a brand promise is what you say to your customers that you will do for them if they purchase your product or service.  Fulfilling that promise is critical to building trust in your brand.  With trust comes growth through more sales, higher revenue, and long-term customer relationships…repeat business.  In the absence of trust, your brand is teetering on thin ice with the slightest move one way or another causing a complete collapse.

Companies that consistently demonstrate their brand promise include:  Nordstrom, Whole Foods, Lowes, and the Four Seasons Hotels & Resorts.  These companies understand the importance of connecting their brand promise to their operating plans…and they execute in most cases with near perfection.

But what happens when a company falls through the ice on their brand promise?

JC Penney has been struggling for years.  After the Great Recession JCP’s revenues began to fall and store sales declined.  In the fall of 2011, JCP turned to Ron Johnson, a celebrated senior executive from Apple and more recently Target, to lead a turnaround of this iconic brand.  Unfortunately Mr. Johnson began tinkering with an age-old JCP promise that centered around weekly “sales” of their merchandise.  In a bold move Mr. Johnson eliminated “weekly sales” and began promoting “everyday low prices”, a promise Wal-Mart built an empire upon.  I believe what Mr. Johnson missed was the fact that consumer attitudes didn’t align with this new JCP brand promise.

Of course the result of this move became clear very quickly.  The stock price dropped by more than 50% in the 16 months Ron Johnson was at the helm.  JCP’s revenue declined by nearly 30% and profits turned into losses in 2012 and so far in 2013.

So is it even possible to change your brand promise?  The answer is yes.  I’ll explore this process in a future upcoming blog.  As a sneak peek I’d suggest that it all starts and ends with a deep and intimate knowledge and understanding of  your customers, as well as your complete target audience.

What’s happening at Apple?

On By Joe DeRosaIn Business2 Comments

With last week’s financial results posted by Apple showing a $1.3 billion decrease in year-over-year profits, is it possible we are about to witness one of the greatest rise and fall from corporate stardom?  What’s going on at Apple?  What are the employees thinking?  Better yet what is Tim Cook thinking?

Sure Apple returned a nearly $19 billion to shareholders via dividends and share repurchases, but their operating numbers raise some eyebrows.  While revenue was nearly flat at $35 billion this quarter, over the same period last year, what is more concerning is the drop in profit.  This year’s quarterly profit was $6.9 billion compared to a $8.8 billion profit a year ago.  And to make matters worse, sales of iPads dropped by more than 2.5 million units along with a 200,000 unit-sale decrease in Macs.

So what’s happening at Apple?  Have they lost their swagger.  Perhaps.  But why?  Is the answer fear?

Apple has been one of the most, if not the most coveted brand for the last decade.  People rush to buy their products, attend their conferences, and hope to work for a company whose founder is no doubt the greatest visionary of this generation.  Apple’s goals and desires rose above Wall Street’s performance expectations.  They operated with this notion that they could really change people’s lives…and they did.  And, as a result of changing millions of lives they in fact changed the world and how we consume information, use it, access it, and show it off.  Apple products carry a certain cachet with them.  All these accomplishments are the result of many things but perhaps the single biggest driving force behind their success was Steve Jobs.  A bold visionary who bucked the pressures of Wall Street and critics and moved in directions others wouldn’t dare.

Today Tim Cook is at the helm with some big shoes to fill.  It’s hard to expect a mere man, while a good man, to become superhuman like Jobs.  Cook may be a good operator but he’s no Jobs.  He may have walked into the worst CEO seat in the universe.  After all, following in the footsteps of someone like Steve Jobs would be difficult even for many of the greatest CEOs of all time.

Signs are already showing that Apple is becoming a “me-too” company.  After the strange introduction of the iPad mini, I began to wonder what was next.  Perhaps a gaming system like Xbox, or getting into selling flat screen TVs like Samsung?  Apple seems to be flailing about trying to find their way.  They’ve shifted their strategy in their retail stores from a laid-back, informative, fun experience to the typical “gotta sell them something” model used by all other retailers.  Unfortunately this shift has been noticed by consumers and they have voted with their feet as sales slipped to $4 billion, down slightly from a year earlier.

While the fear of failure affects people and companies differently, with Apple it may not have a positive result.  Companies throughout history have turned to visionaries when facing troubled times.  Chrysler turned to Lee Iacocca, GM turned to Bob Lutz, JP Morgan turned to Jamie Dimon, and Xerox turned to Anne Mulcahy.  Leaders that have clarity of vision along with a strong sense of conviction.  These leaders took bold actions, dismissed Wall Street, and focused their attention on the priority of turning their respective companies around.

Apple needs to find its hunger for innovation and market disruption once again if it expects to stay on top.  The out-of-the-box thinking driven by Jobs, along with his obsession with elegant, yet simple-to-use designs, created a Disney-like company where dreams are made of.  Let’s hope the dream is not over.