What Happens if I Get Audited?!

It's certainly not a campfire horror story but many Canadians fear that they may be subjected to a tax audit. Is there basis to that fear?

The truth is that, for most personal tax returns, the chances of an audit are slim. The vast majority of Canadians, more than 90%, completes their tax returns accurately and files them on time. Of more than 26 million personal and corporate returns filed annually, the Canadian Revenue Agency (CRA) audits less than 2%. Most personal returns are accurate as the bulk of personal income is recorded on T4 slips. However, returns from small and medium sized businesses may be prone to error or may be fraudulent. As such, most CRA audits are directed at the business community.

This is not to say that you should assume that whatever you include in your personal return will slide through unnoticed. For example, if you live in a neighbourhood of stately, expensive homes, yet your income is barely above minimum wage, you may expect to be queried by the CRA as to other sources of income to support your lifestyle.

Should you be chosen for a tax audit, it is wrong to assume that the CRA is searching for criminal activity. A tax audit is conducted to ensure compliance with the Income Tax Act. An auditor may actually discover that you overpaid taxes and a refund is due. In any event, don't be confrontational. Cooperate with the tax auditor and make all your records available. It is possible that you made an honest error and you have the opportunity to discuss this with the auditor. The auditor is also well versed in tax issues and may be able to offer helpful advice in your tax matters.

Overall, be prepared. Keep careful records and don't discard them immediately after filing your return. If the tax auditor knocks at your door, be ready and be helpful.

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How to Master Canadian Taxes Before Next Year

If you compiled a list of Canada's greatest complexities, chances are very good that the Canadian Income Tax Act would command a respectable spot on that list. In recent years, it has expanded incredibly, becoming a quagmire of confusion to the average citizen. It is no wonder that more than half of all Canadians now secure professional help to prepare and file their tax returns.

Have you tried to hold a conversation with a tax preparer during tax season? It is limited to several words as most tax professionals literally work around the clock to prepare as many returns as possible. If you are one of the clients, appreciate that your expectations are linked directly to your level of cooperation. In other words, your accountant cannot use information, sometimes basic and crucial, if you don't supply it. Due to the tremendous workload and seasonal pressure, the accountant may not ask every question. Therefore, be prepared to supply certain information, along with your receipts and T4's or T5's.

The amount of tax you pay depends on a number of key facts that your accountant should know. Marital status and exact age are crucial as these affect possible tax credits or deductions. Your children, depending on their ages, create numerous tax credits and deductible expenses. Accuracy is essential; there is no room for approximation.

If you were employed at several jobs, be sure that each employer is listed in your return, even if you did not receive a T4. You are responsible for paying taxes on earned income and your accountant must be aware of every dollar that you earned.

If you own a business, compile a detailed list of every possible expense and revenue. Your accountant can decide which are not relevant, if any. Don't make assumptions by yourself; let the professional decide.

List all your financial holdings, including any overseas investments. With all the pertinent information available, your accountant can determine your tax liabilities. Similarly, don’t forget to list "non-employment" income such as rental income, capital gains from sale of property, etc.

Finally, don't forget medical expenses. Keep all your receipts for treatments, medications, insurance, etc. You paid dearly for your health and some of the expenses may return to you.

Spend some time researching tax credits and benefits. If you're not sure whether you are eligible, ask your accountant. It is better to err on the side of caution. It's easier to remove some numbers but much harder to add them if they were never included.

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How Can I Find a Good Accountant?

May 2010; the tax season is behind us for another year. If you are like almost half the Canadian population, you prepare your own taxes each year. But, as the Canadian tax code is growing increasingly more complex, a greater number of Canadians are seeking professional assistance from accountants in order to reduce the risk of paying unnecessary taxes.

Locating accountants is relatively easy. Finding the accountant suitable for your specific needs is far more difficult. Canada boasts three professional accounting bodies whose members are certified to serve the accounting needs of the nation. However, each organization has different standards and requirements for membership. Therefore, if you are shopping for an accountant, it's best to decide precisely what your needs are and interview prospective accountants carefully.

By far, Chartered Accountants (CA's) are the best trained accounting professionals. Only CA's can audit and sign financial statements. Roughly 40% of CA's in Canada work with the public, while the remainder is employed in the private sector, government, or education. Although advertisements for CA's will make many claims, it is wise to get several references.

In addition to CA's, Canada also has 37,000 Certified Management Accountants (CMA's). Generally, CMA's do not have private practices but, rather, work in large organizations, monitoring and interpreting operating results to help management develop operating strategies. Nonetheless, a CMA should have adequate training to help a small business or a self-employed individual with basic tax management and preparation.

Finally, Certified General Accountants (CGA's) offer a little something for everybody, working both in private practice as well as corporate or government settings.

Whomever you choose, your best bet is to ask friends and colleagues for recommendations. Also, take the time to interview at least three prospective candidates. Be sure that the chemistry is right between you. But, as much as possible, try to be your own accountant. A wealth of information is available online today. If you can't do it yourself, gather as much information as possible so you know what to request of your accountant. By learning to prepare your own taxes, you'll gain valuable insight into managing your everyday financial affairs.

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How to Make Yourself Invaluable to the Customers

Let's face the facts. If you ever believed that attracting new customers was your biggest business challenge, you were sorely mistaken. Winning customers is less than half the battle. The bigger challenge, most business owners would agree, is how to keep them. After all, if you devoted most of your energy in trying to attract a customer to you, logic dictates that someone else is also trying. Therefore, you have to work extra hard to retain that customer, rather than their moving to the competition.

But, how do you put that theory into actual practice? If you have developed a successful service or product, chances are very good that your competitor is working on an improved version. And, the improved version just may sway the customer from you to the competition.

The human aspect is a vital component of success. You have to create an environment that a customer will regret leaving. Certainly, business is about sales and strategies, finance and finesse. It's also all about people. Becoming more than a supplier of goods and services is the secret link. Learn to appreciate that your customer has needs outside of normal office hours. Be ready to go the distance for your customers and they will remember. Make their concerns your concerns, even at the risk of having a major headache. Also, think outside the box. How can you help your client's business, above and beyond what you already supply? Work hard to make yourself an extension of your client's enterprise. The customer should know and feel that you can always be counted on, no matter what or when, even if they only need advice. True, talk is cheap but it can be an investment with a fantastic return.

From the first time a new customer comes through your door, approach the moment as the start of a long term relationship. If you proceed along those lines, you will have laid the foundation for a bright future.

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The Key to Customer Relations

Here's a timely riddle. What is the definition of a terrific sale with no customers? The answer is – Useless.

The dust has not yet settled on the recent recession yet tomes have been written, countless lectures have been delivered, and editorials that can bring a tear to your eye have become the fashion. Yet, when all is said and done, pointing fingers and laying blame will change little. Unless we walk away from the financial warfare having learned how to prepare for the next time, all will have been for naught.

A common misconception was that retail failures were due to customers not shopping. That is not exactly correct. While true that consumer spending was reduced, it did not stop. There is always a need to purchase. However, shoppers became far more particular about what they purchased and where.

A secret to retail success lies in the relationship between the vendor and the customer. Consumers are far more likely to continue supporting a particular establishment when they feel an emotional tie. As such, building a strong bond with your customers is your best strategy. They will be far less likely to abandon you, even when times are bad.

It is a mistake to think that "the sale of the century" will drive traffic your way. Certainly, you may encounter a one-time success. But, after the sale ends, customers are far more likely to return to the friendly merchant who places an emphasis on efficient, courteous service. Customers prefer to frequent establishments where they feel like someone, not something. If you always stand behind your products and services, people realize that you are providing true value. Keeping your customers satisfied – no matter how difficult that may sometimes be – is the key to customer longevity. And, at the end of the day, that puts money in the bank.

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Business Plan: Change As Needed

A business plan is a vital management tool. It allows you to create a road map of your business and look ahead while, at the same time, plot the necessary steps to achieve your goals. However, paraphrasing the poet Robert Burns, the best laid plans of mice and men often go askew. How true in business.

The world has learned much from the recent recession. One of the more important business lessons that the recession has taught us is that nothing is guaranteed. How many of us watched as financial giants, titans of the business world, tumbled like a house of cards? Who would have envisioned the swift changes that changed the way we live, not over a generation but over the course of a year or two?

Change is the key. The businesses that best survived the recession were those that understood the necessity of change. A business plan is not set in stone. Rather, as a useful management tool, it should not be allowed to gather dust. Just the opposite. It should be, and can be, changed. Business, like life itself, is a rollercoaster. Even if some of the ride is scary, you can't get off in the middle. You need to be flexible and allow yourself to adapt to new situations.

If you see a new business opportunity, change your business plan to incorporate it. Allow yourself the flexibility to explore new options. Don't be afraid to try new ideas. Sometimes, even bad situations can create new opportunities. If your plan went awry when the markets went in a different direction, turn everything around to incorporate the new reality. You may wake up one day and realize that your goals are no longer attainable. Don't try to change the world to meet your goals. Change your goals to accommodate the world. The most successful entrepreneurs have learned that opportunities present themselves and the winners are those who seize those opportunities. Always use the situation at hand to your best advantage.

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If You Fail, Try, Try Again!

Legendary football coach Vince Lombardi once said, "Winning isn't everything; it's the only thing." While the coach may have been an inspiration to his players, was he also stating a mantra for everyday life?

As children, we often were told by parents and teachers to learn from our mistakes. Would that life were so easy to enable us to succeed after every failed attempt. Anyone who has ever established a business will attest to the fact that the goal of success is not always realistic. Business is a mélange of so many details; many of which are beyond our control yet have a direct influence on our business. The fact is that winning all the time simply is not possible (with all due respect to Coach Lombardi). The question is what you do with the failure. Perhaps it is better to quote from the Coach who also said, "The difference between a successful person and others is not a lack of strength, not a lack of knowledge, but rather a lack of will."

Canadians often compare themselves to their neighbours to the south. Yet, despite the many similarities, Canadians and Americans differ greatly in their respective business cultures. In both Canada and the U.S., for each business success story, there are dozens of failures. In either culture, entrepreneurs prepare and plan, hoping that they will be the next Fortune 500 leader or, at the minimum, establish a profitable business. Some succeed, some don't. The different reactions, though, are startling. Canadians tend to view a business failure as the end of the road. Americans, on the other hand, accept failure as part of the learning cycle and build upon the knowledge gained. The Canadian accepts his fate and the American drives forward.

Canada may be recovering well from the recession. Yet, it seems there is still much that can be learned from the American business community.

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Canadian Tax Deductions to Keep in Mind

Get ready, Canada – April 30th is rapidly approaching. As most Canadians are aware, this auspicious date heralds the end of the tax season for the previous year. It is your last opportunity to make any adjustments to your taxable income and, hopefully, reduce the tax due.

Tax deductions exist within the legal system to allow a degree of parity amongst taxpayers and create a balance between earned income and the relevant taxes. However, as most accountants will point out, although the government will allow you legal deductions on your tax return, they will not contact you to point out possible deductions that you missed claiming. Therefore, research and consulting may be worth money in your pocket.

Here are a few sample deductions you may have missed:

Certain adult family members living at home can reduce your taxable income. If you have a relative over 18 with a physical or mental disability, and they live with you, you can deduct more than $4,000 of your taxable income for the expenses incurred for them.

Do you work from home in your rented apartment? If you have dedicated workspace at home, and work there at least 50% of your time, a portion of your rent and maintenance expenses may qualify as a tax deduction

If you are required to use your own car for business purposes, and do not receive a nontaxable allowance from your employer, you can deduct a portion of your auto expenses including lease payment, loan interest, maintenance, licence and repairs.

Who ever thought that your hobby may be tax deductible? If you earn some side income from your hobby and travel in order to do so, a portion of the travel expenses can be claimed against your taxable income.

A person who drives for a living can claim a portion of their food expenses while traveling. Similarly, when you travel for work, it is expected that you need lodging and showers. These, too, are deductible expenses.

If you are filing a simple return, it may not be necessary for you to incur the expense of a professional tax preparer. The Canada Revenue Agency maintains a highly informative website. On the other hand, if you feel you may be missing something, consult with a professional. After all, as honest hardworking Canadians, we all pay our taxes. But, we wouldn't mind paying just a little less.

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Customer Red Flags to Watch Out for

If you are in business, you know that you have to constantly be on alert on all fronts. You try as hard as you can to plan and operate your business with clear guidelines. Sometimes, though, all the planning cannot prevent the unexpected. Many business leaders will tell you that the problems from outside are the biggest challenge.

In order for you to operate, you count on suppliers for goods and services. Your cash flow is dependant on timely payment by your customers. Any disruption from your suppliers or customers can be harmful to your operations. Continued disruption can become fatal. However, by being vigilant and spotting the early warning signs of potential problems, you can avoid trouble before it happens.

Keep abreast of a customer's payments. If the payments start becoming delinquent on a regular basis, they may be in trouble. Don't wait, though, until they stop paying. Open up a dialogue early to help you collect payments while their doors are still open.

Another warning sign is commonly known as nit-picking. You owe a customer a small credit and they refuse to pay their large bill until the credit is received. This stalling tactic should indicate to you that all is not well, as they could obviously just deduct the credit and send the balance. Perhaps, the customer suddenly begins sending you the balance in several payments, without consulting with you. Your early warning signal should be blaring loudly.

Have you noticed that there has been a large turnover of employees at your customer or supplier? Is this a sign that the passengers are jumping ship before it sinks? When you called to speak to someone over there, the usual perky, friendly reception was replaced by a rather laconic, curt reply or a disinterested, half-hearted response. Be on the alert and assess the situation carefully. You need to protect your interests.

Keeping one step ahead of the storm can be your best insurance plan.

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Keeping a Handle on Your Business

Operating a business successfully has often been compared to a high-speed train. When it runs at peak performance, it arrives at its destination on time. However, if it sits unused in the station, or is not maintained properly, it will cease running well and ultimately break down and fail completely.

Studies have shown that more than half of large business failures result from poorly designed business strategies. Many business leaders have the drive and desire but fail to properly assess the market or their abilities. It is not uncommon for a thriving business to adopt a new idea on the assumption that their notoriety alone will make it happen. "Biting off more than one can chew" has led to the downfall of many business giants.

Another common, and sometimes fatal, error is operating without any accountability. Even the boss has to answer to the board. When decisions are accountable, it makes them open to review by others and allows other sets of eyes to detect possible flaws. The smallest of companies – even one-person operations – should consult with someone else on major decisions. After all, none of us is perfect.

Sometimes change is necessary. Companies that have dominated certain markets have to change with the times or market conditions if they want to maintain their position. Failure to adapt can be suicidal, as there is always someone waiting in the wings to pick up the slack.

Leadership is a 24/7 position. Your employees look up to you and receive their inspiration from the top. A strong leader motivates by example. Failure to convey positive attitudes and emotions can lead to the downfall of your business. Even if your business takes a downturn, you need to continue inspiring your employees to work together with you to overcome. If you appear downtrodden, you can't expect your team to pick you up. The ship will go down with its captain.

Keep a handle on your business by charting your goals and progress. By maintaining control of a situation, rather than it’s controlling you, your train will speed forward to its next destination.

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How to Use Failure to Your Advantage

The word "failure" has negative connotations. It is hard to think of anything positive when discussing failures. Yet, many business leaders will tell you that failure is not the end of the world, nor is it only negative. While a business failure certainly implies setback, it also leaves the door open for improvement, change and opportunity.

American business leaders have embraced the opportunities presented by failures while Canadians lag behind in this respect. The inability or unwillingness to compete is a common denominator of many Canadian business disasters. One of the first lessons to be learned from a business failure is not to cut back but, rather, to dive into the marketplace and compete with all your might. Learn from failure and allow it to be the catalyst that is your driving force. In California's Silicon Valley, business has embraced the concept of "failing well." You made good decisions but circumstances were beyond your control. If you are good at what you do, you'll eventually succeed. In Canada, the opposite is more common. If your business attempt failed, you'll have a very tough time securing capital for another venture.

Failure in business can be one of your greatest teachers. Successful corporate leaders have learned from their mistakes and impart that wisdom to their employees as well. By sharing this wisdom with one's staff, it carries the message that even the boss is not perfect. Moreover, it encourages staff to also learn from their mistakes. Every successful mega-company started small and did not achieve greatness overnight. When your staff appreciates the growing pains of a company, they can become part of the driving force to continue propelling the business forward.

This doesn't mean that one should create a culture that focuses on failure. Just the opposite is true. A business environment should strive for success. Ultimately, that is the goal that we wish to achieve. However, every successful path has setbacks and failures. Learn to appreciate that none of us is perfect and we can learn something new everyday. The only way to avoid failure is to stop trying to achieve. Use every setback to your advantage and ultimately you will win.

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How the Self-Employed Can Save on Taxes

If you are like more than two million Canadians, you own your own business, either fulltime or part-time. Despite the sometimes heartaches of being self-employed, there are many advantages. Many entrepreneurs, though, are unaware of the various tax benefits available to them. In fact, running your own business can increase your after-tax income and contribute to family wealth.

Entrepreneurship and self employment promote a spirit of innovation, ultimately contributing to economic growth and vibrancy. As such, the government encourages entrepreneurship by taxing it at lower rates than regular income.

It is not uncommon for a new business to incur losses as it gets off the ground. These losses can be used to offset revenue from other sources, assuming you have a reasonable profit expectation as the business progresses. As your business begins to turn a profit, you can incorporate and the profits can remain in the corporation as a reinvestment in your operations. It is also possible to leave the profits in the business if you do not need a salary immediately. Thus, you can defer paying personal income tax. A salaried individual cannot schedule when to pay taxes. However, when you are self-employed, you can time payments to yourself when the tax payments are to your benefit.

Profits held in the corporation are taxable in the year they are earned. But, the corporate tax rate is low on the first $500,000 of active business income. While rates vary between provinces, all are below 20%. Personal tax rates on comparable amounts can be as high as 45%. It is also possible to pay salaries to family members in the business and have it taxed at their lower rates. Another possibility is to pay dividends to family members who own shares of the company and, thus, benefit from capital gains exemptions.

There are numerous possibilities for self-employed Canadians to benefit from management of taxes and income. All possibilities and options should be discussed at length with your tax advisor.

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Ways to Finance Your Business

With so many types of business financing available today, it is advisable to check carefully which type is best for your specific purpose.

The most traditional type of financing is debt financing. This is a straightforward loan that is repaid with interest over a certain pre-determined period of time. Generally, it is not an unsecured loan and will require some form of collateral against default. Debt financing can be either short or long term.

Your business may qualify for a line of credit. This loan is generally attached to your chequing account and can help when your cash flow fluctuates greatly. Some business entrepreneurs have secured lines of credit using their personal assets as collateral.

The easiest money that is available quickly is borrowing from your credit card. Although the cash is available immediately, the rates of interest are extremely high compared to commercial loans. This truly should be a last choice option.

Often, a supplier of equipment or machinery will offer financing for your purchase by providing payment terms of 30 – 45 days or extended payment plans with interest. Merchandise is sometimes sold on consignment whereby the buyer only pays for merchandise that is actually sold.

Equity investing involves funding by investors who, in return for their investment, receive a share in the ownership of the business as well as a percentage of the profits. Generally, equity funds are unsecured against the company's assets. If a business owner is trying to raise a large amount of money, it may be possible to use both equity funding and loans against assets to secure the needed amount.

Depending on the type of business you own, there are various types of equity funding available. Angel investors generally are wealthy investors who invest in small businesses and are looking for a healthy return on their investment. Venture capitalists primarily invest in high-tech or leading edge businesses in return for partial control and management.

Large businesses seeking finance may sell shares of their business on the stock exchange. Profits from the company's growth are shared among the shareholders.

Whichever method you choose, be sure that you and your financial advisor examine all the options carefully before any cheques are written.

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Tips for Business Financing

The bottom line is that most businesses need some type of financing, if you don't have enough personal capital. There are numerous options available in today's market. Before borrowing from any source, conduct thorough research to learn how much the loan will actually cost and if that is the best option for you.

Before you approach any type of lender, you will need to prepare or update your business plan. Every lender needs to be convinced that you have the ability to repay the loan. A well written, detailed professional business plan will demonstrate to the lender that your business will indeed generate profits to enable repayment.

In some cases, a lender may require more collateral than the business can offer. The business may seem to have potential but the actual projected profits are slightly questionable. You may be asked to put up personal assets (car, home, personal investments) as additional collateral for your business loan.

Keep in mind that lending money is based on assessing risk and return. You may seem like a terrific person but that will only get you through the pleasantries of meeting with the lender. Getting down to the issues, the lender is in the business of lending money and making a profit from that loan. Therefore, you will have to demonstrate that your business does not present a risk and, moreover, that the loan will be guaranteed and will yield the return that the lender is interested in earning. Anything less than meeting the lender's expectations may result in not securing the loan or investment.

As a business loan or investment can be quite complex, and there are various tax issues to be concerned with, both personal and business; so it is most advisable to discuss all your options with your personal tax advisor. Although your business may need an immediate influx of cash, take the time to examine and consider the best options for your needs.

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What Government Funding Can I Get for my Business?

If you are like most Canadians in business, you've probably wondered if you can ever get something back from the government, after you've paid all those taxes over the years. It seems only fair.

The best situation is discovering that you are eligible for a government grant or contribution. Grants do not need to be repaid and contributions are only repaid in certain cases. The problem is that these are few and far between. Generally, grants are available for specific programs and have very specific criteria. For the most part, grants usually are provided for specific industry sectors or for certain demographic groups.

On the other hand, there may be other government options that are applicable to your business. For example, you may be eligible for a government loan guarantee. This would enable you to get a loan that you might otherwise not receive approval for. With the government behind you, the bank will be far more willing to talk with you.

If you hire employees that have certain characteristics, you may be entitled to wage subsidies to help offset their salaries. Check with your tax advisor who is currently on the subsidy list and whether your business can benefit from these employees.

If your business makes certain investments, you may be entitled to a tax credit or refund. Check the current information with the relevant tax authorities.

If your business does not qualify for a commercial loan, you may be entitled to a loan from various government departments. Also, these government offices sometimes offer loans to businesses at lower rates than commercial lending institutions. A little research may save you some money.

In general, before assuming that your neighbourhood bank is the only lending option that you have, check what's available from the government. You may be pleasantly surprised.

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How to Valuate Your Business

There comes a time for many businesses when it may be necessary to find investors or a buyer. In either case, it will be imperative to assess the value of your business. Long before you approach a potential investor or buyer, you need to know exactly where the negotiations will begin.

Valuating a business is by no means an exact science. There are several common methods that can be employed. Each method uses different assumptions and, logically, each method will result in a different value. Obviously, part of the negotiation will involve agreeing upon the method employed to determine the business' worth.

Many investors prefer the Discounted Cash Flow method to determine the value of the business. It is based on future cash flows. By employing this method, the investor can see a projection of the actual cash that will come to the company and thus determine the investor's return on investment. A similar method is determining the Going Concern Value. This method compares the current investment to future cash inflows. The revenues of previous years are used to project future revenues, on the assumption that the revenues will not change drastically.

Another common method to determine the value of a company is based on assets. A determination of the book value of the company is quite straightforward. The company's net worth, or shareholders' equity, is determined based on the financial statements of the company. Quite simply, subtract liabilities from gross assets and the result is the net worth or book value.

A similar method is determining the liquidation value of the company, based on the company's assets. This method calculates the income from the sale of all the company's assets. The assumption is that equipment and land would be sold at a price close to their market value. Inventory and receivables generally yield a reduced value. A liquidation value is generally employed for the sale of a business, rather than investment purposes.

Whichever method you use, it is best to consult with a professional advisor who can help avoid mistakes that could prove costly.

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Customers at the Centre

An all too common mistake of many businesses is losing sight of what is truly important. It is relatively easy to get caught up in strategic planning, marketing techniques, employee relations, technological upgrading, and a milieu of other items that are important to the successful operation of a business. But, when the dust settles, we tend to forget the most important element of our business – the customer.

The customer is the core of our business. Without customers, business is just…a business. It won't sell but it will be there, though not for long. In today's market, customers are bombarded with information and have more choices available than ever. Gone are the days of Pop's General Store. Pop sold everything and when he didn't, you made do without. Today, it's a buyer's market. Customers can shop for virtually everything they want. Internet shopping makes the world their marketplace. In order for a business to attract buyers, they must be able to reach out to that customer in a way that will get the business noticed.

Find out what the customer really needs or wants, not what you think. What issues are affecting the customer that will cause them to need your product or service? Why should the customer identify with you?

Sometimes, the customer is unsure of what they need. They may know that they are in a certain situation and "something" could help them, if they only knew what it was. This is a chance for your business to fill that void. Customize your service or product to help the customer.

Think outside the box. Inside the box is your business. The customer is outside. Find out what your business must do to break through the constraints. Remember that you need the customer more than they need you. However, when you can create the link that makes their needs your needs, you'll put your business on the winning track.

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What Should Go in My Business Plan?

A good business plan is more than merely a document. It is a carefully designed outline of your business, a veritable blueprint that accurately describes your business and all its components. Business plans differ in length and detail, depending on the nature of the business. However, there are certain basic elements that a good business plan should contain.

Begin with the Executive Summary. Many consider this to be the most important section of the plan. It provides an overview of the key points of the business. It should contain highlights from all sections of the plan and should be written in an interesting, concise manner, not to exceed two pages. Often, the reader will only read this section. If it doesn't grab the reader's attention, they may not go further.

Follow this with a detailed description of the business opportunity. In simple language, describe what this business will do and why it should succeed. Why are you the right person for this business? What is your vision?

You have done your market research. Put the results into a detailed marketing plan. This section of the plan should demonstrate how you plan to enter the market. How do you plan to promote your business? What are your pricing and sales strategies? How large is your potential customer base and how do you identify them?

Build an organizational chart. Describe the key members of your team and what will be their roles. Include the qualifications of the leading managers, including you. This section should clearly convince the reader that this business will have the team to make it happen.

Follow the organizational chart with a description of the operational requirements. How will the business operate? What are the physical requirements? What types of technology will be employed in the daily operations?

Now comes the number crunching. The financial section should contain a detailed outline of your financial forecast for the first three to five years. The first year should be far more detailed. An investor should see that you truly understand the business. This section should contain cash flow statements, profit and loss forecasts, and sales projections.

Remember that the language of a business plan should be directed to an outsider. Make the plan realistic and believable. Invest your time in preparation as this document may be the key to launching your business.

More help on setting up a business plan

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Do I Need a Business Plan?

A business plan sounds like a complex study. In some cases, it may be. But, the question is asked if every business truly requires a business plan?

The answer to that question is "yes", more often than not. A viable business, rather small or large, should make use of a well-designed business plan at some point in time.

Starting at the time when the business is still but an idea, a business plan is an excellent way to organize ideas. It allows you to create a filing system in which the various cogs and wheels begin to come together into a working machine. Long before you begin actually getting the idea off the ground, your business plan allows you to draw a picture of your idea – so to speak – and stand back to take a look if there are any mistakes or problems. Also, none of us are perfect. Especially if we are dealing with a complex idea such as a new business, it is best to have others review our concepts. Your business plan is an excellent way to allow others to help you develop your thoughts and use their feedback to improve what you have begun.

As your business begins taking shape, you will need the business plan to help interest possible investors. Your bank may wish to see the plan when you begin discussing credit with them. Perhaps you have decided to take in a partner. The business plan will be dissected at your meeting. The business plan is the blueprint of your business. It should accurately describe the concept. It will discuss the goals, milestones, financing, cash flow, staffing, and virtually every aspect of your business. It is the theoretical side of the entity. Also, a good business plan should be updated as the business begins operating, especially in relation to financial projections.

Invest the time to write a proper business plan. It is an investment that will have a guaranteed positive return.

Here is some business plan software to get you started.

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Where Passion Can Lead

In today's fast paced, high tech world, young people at the beginning of their careers face a tremendous amount of questions and, sometimes, stressful issues. Perhaps one of the most perplexing questions facing students today pertains to career direction and the road to success.

Many would like to believe that pursuing certain courses of study or entering specific fields is the guarantee to a stable, lucrative career. Would that were true; universities would be an entirely different entity. But, the truth is that there are no guarantees for success. Hard work is still a required pre-requisite for advancement. Yet, if one were to ask business executives for their advice, many would say that passion is an important trait to have.

Of course, it is advisable to do some research when planning a course of study. Look ahead and see where the markets are heading. Which fields are emerging and will present the best employment options several years from now? Which fields have room for advancement? Follow current events and see where money is being invested these days. But, there is still more to take into account.

A career should be more than a job. A job produces income but life is more than just money. And, over time, a job that is just a job starts to pale. Looking ahead, one must imagine where they would like to be and what they would like to achieve. Achievement requires personal drive and that requires a degree of passion. It is passion that gives the personal drive to forge ahead and get the most from your career. An MBA is an important academic credential. Yet, there are many people who have succeeded in business without an MBA. Their passion for success has given them the drive to excel and rise above challenges. Passion is the adrenalin that makes each day a new and exciting experience. And, it is passion for your career that gives you the winning edge over everyone else.

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Learn to Manage

Congratulations! You've been promoted to, or hired for, a management position. The job is waiting for you but what about the people? No workplace is complete with out its nuances and office-politics. If you think that technical knowledge is enough to succeed at your new position, time to wake up. There's a lot more to know.

Understand that management is "them" of the company. If you have moved up the ranks, your relationships are about to change. You simply cannot allow yourself to be friends with the same people you have to manage. Friendly yes; friends no. Anyone who has made the mistake of retaining those close friendships and then had to fire one of those friends will understand. In order to manage people well, you have to remain objective.

From the onset, let the staff know what your expectations are. How are they to be evaluated? Learn what their goals are. Also, learn to consult with your staff. Their experience is most valuable. At the same time, be sure to clarify what upper management expects of you. A common mistake is to hire managers but not supply them with all the tools they need. Don't be afraid to admit that you don't know everything.

If you see problems with certain staff, especially those who may be rejecting your new position, address the problem immediately. Your popularity is not the concern. That has to be built over a period of time. Your goal is to manage an effective team and that starts day one. Don't remain aloof. Your office is your workplace, not a private sanctum. A sign of a healthy situation is well tread carpet from that office leading in both directions.

It is often effective to listen to office gossip, not get caught up in it (or necessarily believe anything). The informal workings of a workplace are part of its lifeblood. You have to know the who's who but don't take sides, just listen. It would be a mistake to assign two employees at loggerheads with each other to a mutual task. Perhaps you can help them solve their differences but work comes first.

Step by step, establish your authority, build your contacts and learn to listen. Effective communication in all directions is your best ally.

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Dealing With Your Boss

There are many different names in the workplace vernacular for dealing with your boss. But, when your goal is to get the job done well and contribute to your own career advancement, there is only one thing that really matters – know how to be as effective as possible.

As business had become ever so complex over the few decades, so have the management systems and strategies behind them. In the ever-relenting battle of the business world, the need to thrive and survive has created new management sciences virtually uncharted a business generation ago. The traditional flow chart and pyramid have been redesigned, allowing for much greater flexibility but also margin for error.

In days gone by, the boss sat in the corner office nearby or, perhaps, one floor up. It was usually possible to drop in for a chat and get to know the person, as well as the position. In this age of instant global communication, it is quite possible for one's superiors to be located anywhere on the planet. Many times, the ability to interact personally is just unrealistic. How can one be sure that they are on the right track? Perhaps all the hard work is just preparing for a surprise bombshell of dismissal?

If you want to succeed, the responsibility is yours, not the boss. You need to create the conditions. Keep the lines of communication open and learn what the boss wants to hear. Don't be afraid to ask. Many times employees are afraid that the boss is only out to get them when that is far from true. Try to keep abreast of what's happening in your company. Your boss also has a boss. Find out what your boss needs and make the information available. Help develop a solid relationship based on mutual need and trust, not fear. Try to appreciate that the boss is probably busier than you so use time accordingly. When the relationship between the two of you is solid, no matter where you are, each of you can help the other achieve goals.

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The Challenges of Female MBA's

With few exceptions, the business world has never been a bed of roses for women. In a society that still views business primarily as a "man's world," women, despite their capabilities and qualifications, continue to fight an uphill battle for equality that is due them.

A recent study conducted by Catalyst, a non-profit organization for women in the workplace, compared 9,000 male and female MBAs entering the workforce over a ten year period. 46 percent of the males received entry-level positions while 60 percent of the women were hired at an entry level, despite the same level of professional experience for both gender groups. Likewise, the men earned $4,600 more at their first jobs.

One of the reasons given for the parities is not prejudice but practicality. Most companies hire employees with a long term plan in mind. It is anticipated that young women entering the workforce after college will have children within a certain period of time, thus disturbing the succession planning of the company. Thus, businesses prefer to invest more in men, anticipating longevity with the company. Women, themselves, admit that family commitments may disrupt their careers and, therefore, they tend not to lobby and pursue the top positions.

The point was driven home in another study conducted jointly by the Columbia Business School and the Women's Executive Circle of New York. The study went beyond entry levels and found that the disparities plague women throughout their careers. In examining women's roles at the 100 largest public corporations based in New York, less than 11 percent of the C-level positions were held by women.

Women are making strides in the business world but the progress is slow. Companies do want equality but this will only occur when the business world attunes itself to the needs of the cultural world, allowing the business world to benefit from the many qualified and experienced women available, while modifying to meet the needs of the women's lifestyles.

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Border Frustration

And there we have it – another dream dashed. The Canadian business community looked across the Atlantic and envied the open borders of the European Union. Imagine shipping materials and products between countries in a virtually hassle-free method. Every day, more than $1.5 billion in goods crosses the border between the U.S. and Canada. Thanks to the near state of panic of the American government, entering the United States has never been more difficult.

To be fair, the U.S. has cause to be concerned. The American nation is probably the number one target of terrorists worldwide. However, many have asked if the overly stringent security measures are not being employed in the wrong places. Are U.S. security measures doing more harm than good?

Take a look, for example, at the Great Lakes shared by Canada and the U.S. At the same time that kindly old grandmothers are having their belongings thoroughly searched, prior to being exposed to full body scans, a low level terrorist, with limited resources and minimal effort, can cross an open body of water between the countries in a canoe.

The auto industry, already in a troubled state, is suffering terribly from U.S. border restrictions. A foreign auto company can import 4,000 vehicles to the U.S. with a single customs clearance. On the other hand, the same number of vehicles manufactured in joint U.S./Canada ventures – where the complete assembly process may involve up to seven border crossings due to the integration of the supply chain – require almost 28,000 customs and security clearances!

For many of us who remember entering the U.S. many years ago using a library card for identification, those days are long gone. Passports are now required and lengthy, sometimes infuriating lines are now commonplace. As Europe moves to a common currency and mutual trust, the U.S. is building a deep moat around its castle.

The economic and commercial links between Canada and the U.S. are far too intertwined to ignore. As such, perhaps the nations' leaders should be searching for ways to punish the terrorists without punishing the innocent bystanders.
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More Capital for Women Entrepreneurs in Canada!

Let us not be fooled! In this era of civil rights and equality for all, women entrepreneurs are still fighting an uphill battle with the business community. For the last 18 years, a federally incorporated, non-profit organization known as "Women Entrepreneurs of Canada" has been dedicated to serving the interests of established women in business.

In Canada, 40% of all new start-up businesses are owned by women. Across the nation, Canada's top 100 companies account for 1.5 million jobs. In comparison, companies owned or led by women account for more than 1.7 million jobs. Furthermore, the number of women-owned start-ups is growing at twice the rate of those by men. The list of comparative statistics goes on but the point is crystal clear. Women entrepreneurs are major players in the Canadian business market. Yet, despite their numbers and influence, women in business still play second fiddle to their male counterparts.

This point is driven home quite clearly when women seek capital for development and growth of their businesses. One reason for the restrictions on capital available to women is the tendency of women to own and operate smaller businesses that are slower to grow and are considered higher risks such as retail and service.

Be that as it may, Women Entrepreneurs of Canada have called upon the Prime Minister to realize the plight of women in business and to address the needs of this substantial segment of the population accordingly. They recommend that the federal government develop an economic assistance program aimed at women owned small and medium sized businesses. Furthermore, they propose that the government develop support programs for women to provide access to technology and management training. This support should also finance and promote international women's trade missions.

Aside from government action, women entrepreneurs should form business alliances to share information and resources as well as establishing joint ventures to bid on large contracts. Women in the business world should share information as much as possible and use their contacts and knowledge to help others advance the cause of women entrepreneurs across Canada.

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Lessons in Crisis Management

It's easy to learn from hindsight. Many an individual has attained tremendous mental wealth from looking back. The big question is whether we learn from our past mistakes, not just gather stories of deeds unaccomplished.

Toyota's safety crisis has been the content of many a recent news item, ranging from tragedies to sensationalism to Congressional hearings. For those not directly affected by the issues at hand, there is still much to learn, especially in the realm of crisis management.

The business world will never be crisis free. However, in order to continue to thrive, managers must know how to best cope in a crisis situation. Failing to respond to the crisis at hand may prove to exacerbate an already difficult situation. There are several key steps that a company, and its management, should follow in a crisis.

The CEO must take immediate command of the situation. Even if the CEO is not a polished public speaker, the public must see that the top person is in charge and leading the company in its difficult time. Otherwise, it's a sinking ship with no captain at the helm.

As soon as possible, start the flow of information. Let the public know that the company has the situation under control and is doing its best. It's imperative to maintain credibility with the public. As difficult as it may be, a unified, hard-working front is crucial. Not having all the answers is legitimate. However, avoiding the situation is not.

Try to think several steps ahead. Experienced management should be able to anticipate what lies ahead in a situation. Be prepared, rather than be caught off-guard.

Don't make light of a serious situation. In a time of crisis, a company's place is to identify with the public. After a crisis has been resolved, the company will need to maintain its customer base. The public will remember if a company identified with them or only worried about itself. Loyalty is a two way street.

Thinking carefully about how and when to act is the key to successful crisis management.

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Should Politicians be Deciding our Fiscal Policies?

It seems that the hurricane called the global recession is starting to lose steam and peter out. But, if you follow global weather patterns, you see that there are always after effects, residual shocks, smaller storms, etc. In short, no disaster seems to operate independently. There is always cause and effect.

So what caused this recession? After all, if you can isolate the cause of a disease, you can help prevent its recurrence. The near collapse of the US economy was frightening. The devastation caused by it harmed countless individuals and businesses alike. Many have not yet recovered. Who is to blame?

It's easy to say that the mega-bonuses within the nation's financial industry were the problem. However inappropriate these bonuses may have been (and continue to be), they were not, and are not, the root of evil. No, when all is said and done, the root of economic evil is lousy government policy. Government leaders, and their script writers, are excellent at describing the ill-gotten gains of the private sector. It is quite easy to divert public attention from the real problems at hand by placing blame at the markets whose goal is to earn money. How many millions of American homes are now in foreclosure due to a mortgage system that was manipulated by US government policy, rather than operated by the modes of free economy?

Imagine, for a moment, that the US government operated along the lines of a major for-profit corporation. The Senate and Congress would be the Boards of Directors and/or shareholders. The CEO and his staff would have to justify their fiscal policies and operate the business in such a way to please the directors and shareholders. After all, the bottom line is what truly matters. Sounds absurd, of course. On the other hand, can one imagine a mega-corporation continuing to function while juggling an operating debt of more than $1 trillion? Of course not. At the minimum, some change in fiscal policy may be deemed necessary.

But, governments continue to operate based on political need. Business will adjust to the times and weather storms as necessary. With a little luck and hard work from non-government entities, society will persevere economically and overcome the mistakes of its political leaders. If we want to avoid another recession, it's truly time that politicians stick to their business but leave the money matters to the professionals.

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Normalizing Interest Rates?

With the end of the global recession now becoming more than merely a prediction, the time has come to begin the clean-up from the temporary measures that were a necessary part of the economy during the difficult financial times. In short, besides stimulus funds becoming part of the scenery, record low interest rates were also an everyday occurrence.

Interest rates, at near zero levels, were the Shangri-la of investors. Investors who could tap this virtually free money, profited well and the markets responded in kind. In a chain of events, this unprecedented boost of the markets helped restore confidence in the average household and greatly strengthened the ailing economy by fortifying its foundations. However, even the best of vacations must come to an end. Any student of economics will tell you that interest rates reflect and influence an economic situation. Artificially set rates will cause undue influence and possible damage. The current rates were set for an emergency situation. With the economic emergency now having been downgraded, the time has come to allow the markets to respond appropriately. The question now is the timing and magnitude of the normalization of rates. Having faced a near collapse of the financial sector in the Western world, it is crucial that the central banks of both the US and Canada time their adjustments accordingly. For example, towards the end of the Great Depression in the 30's, the US government pulled out its stimulus funds in a final push in 1937-38. This sudden move, due to improper timing, had a negative effect, pushing the US economy into a tailspin and sent the markets reeling.

Economists are mixed in their predictions as to the end of the rock-bottom interest rates. Most feel confident that neither the Governor of the Bank of Canada nor the U.S. Federal Chairman will allow a repeat of the Great Depression mistakes. However, even the latest of predictions for rate hikes is no later than early 2011. Some predict that rates will begin rising by this summer. In either case, investors should prepare themselves for a return to normalcy. The worst, we hope, is over.

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Female Entrepreneurs - Unite!

No longer can it be said that business is a man's world. Female entrepreneurs are an integral part of the business world. According to a report from the Organization for Economic Cooperation and Development, Canadian women comprise 30% of business across the nation. This percentage is larger than any other country. In the United States, during a ten year period beginning in 1997, businesses owned by women grew at double the national rate of all U.S. private businesses.

So, the good news is that women are making their mark on business in substantial numbers. The bad news is that they are not using these numbers for any collective purpose or advantage.

There is power in numbers. However, most female entrepreneurs seem to prefer worrying only about themselves. An umbrella organization, Women Entrepreneurs of Canada, whose mandate is to create a more collaborative climate for women business owners, is fighting an uphill battle, as reported to a small core group of members at a recent meeting of the organization.

Rather than share ideas and efforts, the group reported that female business owners prefer to do for themselves and not share. Sharing resources and ideas is simply not the norm in female businesses, leading to duplication of efforts and a loss of a potentially powerful female lobby.

Men invest more time and energy developing their businesses. Thus, women cooperating with each other could greatly strengthen their businesses by uniting their efforts. Also, women are less confident than men in certain key business tasks and could certainly benefit by supporting each other to get over hurdles.

On the other hand, in a male dominated world, women still encounter certain prejudices in business. A strong female lobby could help push for changes in the business world that would lead to parity in general, while addressing the distinct needs of female entrepreneurship when applicable.

This organization, while small at present, is picking up speed and hopes to build a strong, influential coalition of female entrepreneurs to help the nearly one third of Canada's business community leadership.

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Canadian Debt - The Foreign Investment Choice

Canadians, as opposed to many nationals around the world, were long accustomed to hearing reports of budget surpluses. What was once a source of national pride will now seemingly become but memories in the nation's historical archives. The recent recession has left both the national and provincial coffers in ruinous debt, and both are seeking ways to grapple with the need for cash to finance stimulus spending, the primary catalyst of the monumental deficits.

Ironically, while lawmakers must deal with the aftermath of the financial crisis and re-formulate fiscal policies in order to keep the deficits under control, investment bankers see this new situation as a unique opportunity to sell government bonds.

Based on recent figures, the combined national/provincial debt is estimated to reach $100 billion by the end of the current fiscal year. However, selling public debt in these staggering amounts is not as difficult as it may seem, even in a struggling global economy. Canadian debt is being gobbled up by foreign investors at a lightning pace.

It appears that international markets see investment in Canada as a wise choice. Among the Group of Seven countries, Canada has the best fundamentals; a strong, vibrant currency; and is rich in valuable natural resources. Once the dust settles from the recession, these factors will leave Canada well positioned. Wise investors see this as an ideal time to align their investment dollars with strong future potential.

Investment bankers admit that 2009 presented a highly volatile market, with each month differing sharply from its predecessor. But, when all is said and done, the nation's top investment banks, working hand-in-hand with both the federal and provincial governments, have managed to sell the vast majority of government bonds issued, primarily in foreign markets.

The need for cash, combined with the demand for strong investments, led to some unique investment situations for both the federal and provincial governments. However, just as the aftermath of the recession demanded new ideas to deal with new situations, so did the investment world rise to the occasion and help the governments get the best deals possible.

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Did Lack of MBA Ethics Cause the Recession?

It was inevitable that one outcome of the recession, aside from the devastation of the economic hurricane, would be deciding who or what truly was to blame. The truth is there is no one factor or person. However, as the smoke begins to clear, there is increasing blame being attributed to the financial leaders of our generation, specifically the mighty who have fallen.

We have all been witness to major financial scandals over the last couple of years. Many of these scandals have been perpetrated by key figures in the upper echelon financial world, individuals with impeccable credentials, or so we thought. To the dismay of both the public and academia, a good number of these individuals bore MBA's – seemingly their license to direct the financial community – from some top business schools.

While no pattern has emerged, a number of questions have arisen regarding MBA programs and the students therein. While there are no guarantees, an MBA from a top business school is a tremendous stepping stone to a lucrative career. The question is how desperate are students to obtain that coveted degree.

In a 2006 study released by the Academy of Management Learning and Education, an astonishing 56% of MBA students admitted cheating, far exceeding any other major discipline.

The focus of many major MBA programs is quite straightforward – your sole obligation is to make as much money as possible for your stockholders, within the parameters of the law. Unfortunately, a decided absence of ethical teachings has caused many graduates to ignore the legal obligations of earning money. The argument that students want to earn as much as possible in order to repay their expensive education doesn't hold much water. Were that the case, medical students would be dropping like flies in insurance scams.

Many business schools acknowledge that a lack of classes in business ethics may be part of a larger problem and some, indeed, have begun to change their curricula to reflect a necessary change. Others schools have tightened their application processes to help weed out potential "future problems." Overall, the fall of the giants has helped remind us that, in a democratic society, we are all equally accountable for our actions.

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Hope on the Horizon for the US and Canada

The news is out – the recession is over! Or is it?

Whatever you read today seems to have a different opinion. Some say that the worst is behind us and we're recovering very nicely, thank you. Others say that we're experiencing a temporary lull before the next storm. Optimists say we can return to our previous standards of living. Pessimists say that we should learn from our mistakes and prepare for the next rainy day.

The truth probably lies somewhere between the two. The fact is that the best of economists will tell you that predicting the future is virtually impossible. Yet, when the figures are checked and re-checked, the recent economic indicators are rather positive. Forget the major "what-if" theories and focus on what's really happening.

Recently released figures for the final quarter of 2009 indicate a growth in the GDP of both Canada and the U.S. In the U.S., the growth is attributed primarily to inventory rebuilding. While some consider that a temporary measure, likely to taper off, others point out that the need for increased inventory is due to resurgence in consumer spending. True, consumers are still spending their money more cautiously but the figures remain positive.

Not just consumers are spending more. Business investments grew by 2.9% in the final quarter, as compared to a nearly 6% drop in the third quarter. Equipment and software investments rose by a whopping 13.3% for the quarter. Also, net exports added to the U.S. GDP, indicating that the Americans are now using their weak currency and high productivity to their benefit in foreign trade.

Back in Canada, economists have re-examined all the figures and are pleasantly surprised that economic growth in the fourth quarter exceeded 4%, well above the forecasts. The Canadian figures continue to rise well, indicating that recovery is progressing.

It's hard to tell but, for the time being, after a treacherous journey, both Canadians and Americans are safely on the way back home.

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How to Perk Up the Disgruntled Employee

You wonder what happened. A couple of years ago, you hired a key employee who seemed like the whiz kid that would be a major asset to your team. At the onset, it worked. But, as time wore on, the shine began to tarnish. The "whiz" became a "was." It's easy enough to say the employee should go home and you'll find another rising star. But, many managers agree that you would be mistaken. Training new employees is costly, both in time and money. Moreover, if you originally spotted talent, chances are that the talent is still there. The question is what happened along the way and how can you improve the situation.

In the hustle of daily business, managers often tend to focus on the most pressing issues and ignore the secondary or tertiary ones. However, our employees are among the basic raw materials that allow the business to operate. When you consider the fact that the majority of an individual's waking hours are spent at work, it is vital to make sure that the person enjoys his work. There is a direct correlation between performance and employee satisfaction.

Perhaps the whiz kid just became part of the background. You assumed that outstanding performance would just come naturally to such a person. But, what about providing positive feedback? Has a job well done been rewarded, either monetarily or through other recognition? Have you taken the time to sit and chat every now and then? Find out what is bothering that employee. You may discover that a breakdown in the managerial chain of command has affected this person and left a feeling of disgruntlement. In that case, track down the true source of the problem and you might correct the situation. A simple discussion may reveal that your employee needs additional skills in order to perform the task at hand. In that case, attending a course or a change of task will rectify the problem.

Managing an effective staff requires time and skill. It's not enough to give assignments and sign paycheques. Remember that a loyal staff is vital to your company's success. Invest the time and energy to develop and protect that loyalty.

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How to Deal with the Know-It-All Employee

Practically every manager has encountered this employee. An average worker has a self opinion of extreme competence. Yet, despite a decided lack of skills, this employee will make decisions independent of any managers or co-workers.

Different styles of management will handle this situation in a variety of manners. Some would say that this type of behaviour must not be condoned and would immediately dismiss the employee. However, a more experienced manager does not rush to fire employees. After all, one needs working, trained employees, rather than terminated ones.

It is imperative to thoroughly assess the situation. Has the employee's decision making caused damage to the company, either in a business sense or by demoralizing other employees? If so, your response may be somewhat harsher. If not, a subtler tone may be in order.

Speak to the employee. Find out what makes the person tick. Were they trying to cover up a lack of knowledge or simply being irresponsible? Do you think, after speaking to them, that change is possible or is this merely the person's personality? If change is possible, go for it! Sometimes, the mere fact that a person has been noticed can trigger a change, especially if the employee knows that they are being watched. Or, perhaps, a change of scenery may help. Move the employee to a different task. Another tactic to consider is the chain of command. Try allowing the employee to consult with you, rather than a supervisor. The feeling of importance may counter the feelings of resentment or punishment for having been caught doing something wrong.

Each case, undoubtedly, is different and there is no clear cut recipe for success. However, the bottom line is that you have to make a business decision and do what's best for the company, not for your feelings. It's not always easy to do what's right but management is all about making the tough decisions.

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Public Speaking: No Joke (Unless You Can Deliver it Well)

Public speaking does not come easy for some people. For others, it's a snap. The more experienced speakers have learned the secrets while many novices will wake up that morning with a major headache.

Making a presentation, or giving a speech, is part of the business world. But, in order for your presentation to achieve its goal, the delivery must be successful. This requires your connecting with the audience. Experience has demonstrated that a common technique, when applied correctly, is opening with a joke.

A joke, when delivered properly, can break the ice with the audience. It sends a message that the speaker is here to speak with us, not to us. Similar to the co-worker that attracts a crowd at the coffee machine by telling a good joke, you can attract the crowd in front of you to listen to you.

Of course, this is not an opening for a standup routine. Neither should you use the podium to tell the latest racist joke that you heard at the bar last night. The motto is KISS – keep it short and simple. It makes good sense to do some research beforehand and try to learn what makes the audience tick. For example, a high tech joke will not work well for an audience of medical practitioners. But, a good doctor joke certainly will. Be careful, though, not to insult anyone in the audience. If you feel that they will appreciate it, try poking fun at the industry, but only if you're part of it. Outsiders are not usually welcome to do this.

Learn to read your audience. If you see that your joke is not going over well, abandon it (with a shrug for a last ditch attempt at a chuckle) and get on with the business at hand. Delivery is everything! You have to go with the flow of the audience. Sometimes, the audience is waiting for what you have to say. Other times, they may be waiting to leave. Do what you can, in a professional manner, to win them over. Telling jokes, like making a powerful, impacting speech, is an art. Learn the craft carefully and you can be quite successful.

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Buy American and Canadian Too!

The American Recovery and Reinvestment Act of 2009 was the landmark US$787 billion economic stimulus package intended to jumpstart the ailing U.S. economy. While it contained a variety of elements, one of the more controversial clauses was the "Buy American" stipulation. In order to qualify for government contracts, U.S. companies were obligated to buy only from American suppliers and manufacturers.

As both the U.S. and Canada rely heavily on exports between the two nations, "Buy American" was met with strong opposition from both American and Canadian business. Supporters of the clause argued that America needed to boost sales and manufacturing at home. Opponents noted that supply chains north and south of the border are so intertwined that all parties involved would be hurt, not improved.

After months of deliberation between the nations, a multi-faceted trade deal has been reached between Canada and the U.S. All though yet to be fully ratified (the U.S. requires an executive order while Canada requires each province and territory to sign, as well as the federal cabinet), the agreement reflects the spirit of cooperation that has long existed between the two neighbours.

Canadian companies will now be able to bid on procurement contracts in 37 U.S. states. Similarly, U.S. suppliers will receive reciprocal access to provincial procurement. As the possibility of future U.S. federal funding is quite realistic, the current deal contains a commitment to fast-track negotiations on possible "Buy American" stipulations.

As a result of this reaffirmation of the strong links that connect the two nations, talks in Canada of promoting "Buy Canadian" retaliatory actions have been suspended.

Rather than just looking at what's good for each other, both Canada and the U.S. have agreed that maintaining the long-standing friendship will have a positive payout for both countries.

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Obama and Small Businesses

In his recent State of the Union address, U.S. President Obama presented a bold, economic initiative to help bolster his nation's struggling economy. Obama proposed making $30 billion available to small community banks so that they, in turn, can make these funds available in the form of credit to small businesses.

From a patriotic standpoint, Obama is worthy of praise in his concern for small businesses, part of the backbone of America. From an economic standpoint, many feel he has missed the boat.

Many bankers and economists agree that the problem in the U.S. economy is not the lack of credit but the lack of demand by small business and consumers. Simply put, Americans are not interested in borrowing money at this point in time. Unsure of their country's economic future, Americans prefer to save rather than spend. Herein lays the problem for small businesses. Their market has shrunk, due to fewer customers. As a result, they cut costs by hiring less and purchasing less from suppliers. At the end of the chain are the businesses that face closure. In order to keep afloat, these businesses attempt to obtain credit to pay their bills. But, these are the high risk customers that the banks don't want. The banks want the solid customers who can repay their loans. After all, banks make money from repaid credit, not defaulted loans.

At this point, the only banks that would require funds from Obama's $30 billion are those holding problematic loans, and they probably won't qualify. Bank regulators are examining records with magnifying glasses. High risk banks will most probably fail, rather than receive federal relief.

Maybe Obama should re-direct his funds. Stimulus funds need to get into the economy right away. Rather than strengthen the banks that are in trouble, strengthen the small business sector. When consumer spending is stimulated, the wheels of the economy will be oiled and the system will move forward.

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Tips for MBA's Seeking Work in Canada

It's not easy. There's a lot of competition out there, and every unemployed MBA, whether recent or not, is looking for a job. What's the best job search strategy?

Recruiters and career experts offer the same advice to job seekers. Analyze your strengths and focus on your interests. Being an all-around expert in everything will work against you. Have a clear-cut idea of how to best sell yourself. Also, while you're still in school, start making connections. Long before graduation is the time to start developing your network of contacts. Let the business world know who you are and what it can expect down the pipeline. You want business to be waiting for you.

Don't be overly picky. As small, temporary jobs and internships come your way, take them. Each job affords you additional experience and contacts, both of which are vital down the road.

Another avenue to follow is temporary contracts. With a growing number of entrepreneurs starting businesses in Canada, many are seeking business consultants to help them in their start-up ventures. However, while ideas abound, money doesn't. Many cannot afford to hire "top" consulting firms and would rather pay less for younger talent. While these contracts will rarely offer job security to a young MBA graduate, it will help establish credentials and afford opportunities to gain vital hands-on experience.

Current MBA graduates should be aware that patience would have its rewards. A large segment of today's senior management is at the front end of the baby boom generation. Many will be retiring over the next decade, making way for the next generation to make its mark on the business world. Therefore, the time is right for "the next generation" to gather experience and be ready and waiting for the opportunities that are just around the corner.

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Emerging Fields for New MBAs in Canada

There used to be a saying in financial markets, "MBA – leads the way." The question today is where that MBA is leading to. The times are changing and traditions are changing with the times. A student who put in long, hard years of study to earn a respectable MBA degree can still look forward to a rewarding career. But where will that career be?

Banking, long a natural employer of skilled, financial and business minds, has begun to offer new opportunities. The relative strength of Canada's banks has allowed them to expand internationally. This translates into ripe opportunities for MBA's with international experience, or those seeking to gain experience.

With more and more Canadian companies seeking outside, professional advice to help examine and assess their operations, in light of the effects of the recession, consulting jobs are providing prime employment for bright MBA students, especially those with knowledge of those industries that are going through tremendous change, like media, wireless broadband, and health-care.

For many other graduates, the time has come to think outside the box and forge ahead into uncharted territory. Public service is now seeking more MBA students that ever before. For example, the government's stimulus funding for infrastructure projects has created many jobs and projects. These need the right people to administer and oversee these massive projects.

Growth in the non-profit sector has outpaced the economy. As the need for professionals has grown greatly in the "third sector" of non-profits and NGO's, job opportunities for appropriately trained MBA students are continually available.

MBA students, with their fingers on the pulse, are also preparing themselves for careers in other budding sectors, such as sustainability and technology. A good deal of investment dollars is heading to these fields and many companies are seeking top, business minds to help them emerge on top not only financially, but ecologically and socially as well – the top business priorities of the 21st century.

There is one thing that an MBA student will not learn in school. When opportunity knocks – open the door. However, sometimes you have to search for the handle.

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Canadian Auto Industry Driving Growth

Cars are a vital part of the Canadian culture, not to mention the economy. The recent recession had a devastating impact on automobile manufacturers and sales in North America. However, with the economy on the rebound, sunnier days are in sight for the Canadian auto industry.

British Columbia and Alberta, the country's westernmost provinces and both with resource – dependent economies, were hit extremely hard when commodity prices took a nosedive during the recession. However, with the demand for natural resources rapidly returning, the economy in the west is improving and car sales will follow suit. Industry experts predict that new car sales in British Columbia will rise by 5% in 2010 and by 10% in Alberta. This is a major recovery following a dismal 2009 ending in sales declines of 15% in B.C. and 21% in Alberta.

Growing consumer confidence in the nation's economy, coupled with global recovery, is expected to fuel positive sales figures across the nation. Projections for the current year anticipate auto sales to climb to 1.53 million units, 10% higher than sales figures for 2009.

Another province expected to contribute to the rise in sales figures is Saskatchewan. Although the province holds the record for the oldest vehicle fleet in the country – average age exceeding 11 years – auto sales are still 12% above the average. In general, growth in the province has exceeded the national average for the last three years.

On the other end of the scale, Quebec is expected to show only a moderate increase in auto sales of no more than 3%. The province currently has more new vehicles per capita than any other province.

Whether the contributing factor is a recovering economy, a relaxation of credit restrictions, or even purchases for the upcoming Winter Olympics, the fact is that Canadians love their new cars and, having weathered the global storm, it's time to go shopping.

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Career Path for an MBA in Canada

It's best to begin with the good news. Overall, on the global level, the Canadian economy is in much stronger shape than the American economy. That having been stated, life is still rather difficult at a grass roots' level, especially if you are a recent graduate of a fine university, clutching the license to a successful career – your MBA.

This is not to say that an MBA degree is unimportant. Just the contrary! It is a degree well worth pursuing, especially if your career vision is targeted in the business or financial sectors. Unfortunately, though, the current employment market is not the most promising for new MBA's. In the finance sector, traditionally the major MBA employment sector, career centres for MBA graduates report a decline in finance jobs ranging from 6% - 16%. In addition, graduate schools have reported a drop of on-campus recruitment of at least 10%. Furthermore, graduates seeking internships have encountered a serious reduction in available placements. Back to the good news, the dip in salaries in Canada was slight, compared to the major drop in 2002. Estimates are that salaries will return to the pre-recession level by late 2010 or 2011. However, if you can't secure a position, the salary is irrelevant.

Recruitment has been on the rise in some sectors, though. More positions requiring MBA's have become available in government, health care, non-profit, and energy. While these sectors comprise a relatively small percentage of all available jobs, it may cause new graduates to begin thinking in different career directions, away from the traditional employment sectors. Also, a growing number of recent grads have turned to entrepreneurial endeavours, as have many Canadians who have been unable to find employment.

Some graduates have begun looking for foreign employment, although the prospects abroad are also not very encouraging. For most, though, they will weather the storm in Canada, hoping for better times down the road because, when all is said and done, there's no place like home.

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Be Prepared for Slower Growth

It sounds strange but positive thinking may not always be the best course of action. This is true most recently when many businesses have had to weather the storms of the current economic recession.

A recent survey by a major American consulting firm concluded that many businesses have failed to adequately prepare for further slow growth on the economy. While they may have taken measures to keep afloat in the current economic climate, they have assumed that better times are down the road. However, as many current indicators project that the "better times" are still at least two years away, if not more, the fear is that companies may not be prepared.

One of the problems is that preparation for long range financial problems differs from the short term. In order to balance the books presently, some businesses have trimmed administrative overhead and tried to curb spending. But, long term would mean trimming the payroll and restructuring debts. In an era when executives are trying to be optimistic about the future, these "hard-line" steps are far more difficult to make. Business executives realize that profits will be down for awhile but they truly do not expect the downturn to last that much longer. They would rather gamble on a few positive signs as indicators of sunshine rather than admit that the storm may not be over. For many companies, that outlook may be perilous.

Economists feel that we are not yet out of hot water. Cautious optimism may be the best idea but the emphasis is on caution, not optimism. It would be wise for the business community to take precautions in advance of any further problems. Be prepared to handle the economy based on reality, not predictions.

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How to Talk to Your Board

Knowing how to manage a large corporation is not enough for a top executive. It is also crucial to know how to work with your board.

Before entering the boardroom, know who is sitting there and what their expectations are. The way board members think or grasp a particular situation may differ from yours. When you live a company daily, your appreciation of its subtleties, or your comprehension of its needs, will differ from those of someone who knows the company from afar. Therefore, learn who your board members are and present reports to them in the way that they want to hear them. Meet them on their terms.

Don't try to impress the board with fancy numbers, terms, and analyses. They know that you know all this. They want to know the bottom line without a lot of hype. However, don't underestimate their expectations. Present the risks and challenges that the company faces. Your job, after all, is to guide the company through these. They want to know how and how much.

Presenting confidence is vital. You are their person at the helm. When you exude confidence, the board feels comfortable that the company is in strong hands. When possible, don't go into the boardroom "cold turkey." Plan your presentation in advance. Know what you want to say and how to say it best. Also, prepare yourself for tough questions. The board expects you to have all the answers at your fingertips. Therefore, the more you prepare, the better you will appear.

As you make your presentation, keep an eye on your audience. Learn to read body language. Whatever it takes, avoid a bored board. If attention starts waning, it is time to switch gears and get their attention back. Work with them and they will work with you.

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When Your Employee is Too Ambitious

It's a classic business tale that happens all too often. The CEO trains an underling to become a loyal second-in-command and then, one day, the underling attempts to unseat the CEO in order to gain the number one position. The automatic response of the boss is to show number two the door. Should that be the appropriate response?

Truth be told, every situation has to be judged by itself. Certainly, a person who feels threatened will respond in a defensive manner. But let's examine the situation a little more closely.

There are several reasons for training the underling. First of all, one role of a manager is to train employees. Secondly, ambition in senior employees is healthy for the organization. You want the people with drive to be in leadership roles. They help inspire others. A central question is whether that ambition is good for the organization or just for the individual.

Healthy ambition should be channeled appropriately. In fact, helping an employee – even a top level one – chart their career is important. Working toward a career goal can add to the person's drive. However, open communication is all part of the process. Just as a CEO should share visions with the staff, so the staff should be encouraged to reciprocate.

On the other hand, one does not want to be naïve. True that none of us remains at the job forever. An eventual successor will be necessary at some point. However, you should choose that point in time, not the successor. Therefore, it makes good sense to keep your eyes open. A common tactic to usurp power is to "make the boss look bad." Therefore, keep detailed records of meetings and conversations. Don't reveal all the secrets to your trusted aides. A few trump cards in your pocket may be necessary to help maintain order and stability. Remember that trust is mutual. If one side destroys that trust, the rules of the game change and you're the one in charge.

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