Thursday, February 25, 2016

Could a Basic Income Guarantee Be Good For Business?

The basic income guarantee (BIG)—sometimes called a basic minimum income, or negative income tax—is hardly a new idea, but it is currently in vogue. National governments in Switzerland and Finland, and the provincial administration in Quebec, are all considering proposals for a minimum income. Most recently, Canada’s federal government invited one of the country’s foremost experts on the subject to discuss it at a pre-budget hearing in Ottawa.

The BIG is one of those rare policy tools that has garnered support from thinkers, activists, and policymakers all across the ideological spectrum—from the late American neoliberal economist Milton Friedman, to Canadian former Conservative senator Hugh Segal, to the centre-right coalition in Finland, to typically centre-left Green parties, feminists, self-identified progressives, even socialists.

Naturally, many people worry about the potential work disincentive, but past studies—including the Mincome experiment in Dauphin, Manitoba in the 1970s—suggest that this disincentive is not as powerful as one might expect, and may be partially offset by human capital gains. (For example, employees might take time to upgrade their skills rather than work menial jobs to make ends meet; new parents might stay home to look after their young children rather than rush off to work.) If designed effectively, a BIG could have beneficial effects on the labour market, the private sector, the overall education level of society, and public health.

It could afford numerous benefits to businesses and aspiring entrepreneurs in particular.

  Education, skills, and innovation: By providing time for recipients to upgrade their education and cultivate new skills, a BIG could promote both a more dextrous workforce and a better educated society. Visionary individuals would also enjoy more freedom to experiment and hours to invest in long-term projects.

Think of tech pioneers who have spent countless hours tinkering in their garages, refining the latest game-changing breakthrough. A BIG could encourage time-intensive innovation and research, and offer many more creative geniuses the opportunity to engage in it.

  New commercial opportunities: Pro-business advocates of a BIG tend to emphasize its potential to reduce social program and public health costs, while streamlining administration and bureaucracy. In turn, this could allow the private sector to offer services for which the state had previously assumed responsibility. Many existing businesses could look forward to growth in their customer base, since more people would have disposable income.

  Easing of downturns: When economic recessions occur, poverty typically rises, and consumers at all income levels tend to cut back on their spending. Businesses watch their revenues drop due to a lack of customers. Managers respond by laying off employees, which exacerbates the problems of poverty and too few customers. A BIG could help to stabilize the situation by dulling the sharp edges of the business cycle, and mitigating various other social ills associated with hard times.

Of course, many practical questions and details warrant policymakers’ attention. How should we finance a BIG? For the purpose of determining who qualifies, how should we define the poverty line? Would it be appropriate to distribute the BIG differently based on cost of living, or could impecunious residents of inner-city Toronto, downtown Vancouver, Dawson City, Iqaluit, Halifax, and rural Quebec all expect an equal supplement? At what age should individuals become eligible? What about new immigrants and asylum seekers? What about people with serious physical disabilities versus those with able bodies—should they receive different income supplements?

Nonetheless, encouraging results from past trials indicate that the BIG is worthy of the serious consideration some governments are giving it.

Wednesday, February 17, 2016

Best Practices For Firing Someone

It’s a conversation almost no one enjoys having: a member of your staff has fallen short of
expectations, and you’ve decided to let that person go.

With notable exceptions—including a certain U.S. presidential candidate and former reality TV star—many employers favour a gentle, tactful approach to firing. After all, people rarely enjoy being bearers of bad news, especially the kind that can dramatically alter an individual’s life. Nonetheless, clarity and assertiveness are crucial when it comes to firing. No wonder some companies prefer to rely on independent HR consultancies for “termination assistance”!

Be fair and transparent, and maintain a documentary record.

For both legal and ethical reasons, you should establish consistent ground rules for every person you hire, including your organization’s termination policy. If you are having difficulty with an employee, raise the issues you’ve identified in one of h/er regular performance reviews, or arrange a meeting to discuss the matter. Keep a detailed documentary record at every stage of the process. If you see no improvement in the employee’s performance over time, then dismissal may become necessary.

Double-check with the HR department (if you have one).

HR can help provide information about extenuating circumstances the employee faces, or any other relevant details that could influence both your decision and the timing. An HR professional can also provide general support, and be present in the room during The Talk. (If nothing else, it sometimes helps to have company and moral support on such a weighty occasion.)

Once you’ve made a final decision, don’t delay.

It may be that you’re indecisive about firing someone, and you’d like to give that employee an opportunity to redeem h/erself. But once you’ve reached a final decision to dismiss a member of your workforce, and you know deep down that you won’t change your mind, avoid the temptation to dither. The longer a person who isn’t up to the job stays with your organization, the more harm s/he may do, and the more extra work s/he will probably generate for your other staff.

Identify a confidential venue for the conversation (like a conference room or private office), and then get on with it.

Get right to the point.

When everyone (you, the employee, and the HR professional) is seated and paying attention, announce your decision up front, followed by your reasons. You can soften the blow slightly by formulating the statement like so: “I’m afraid I have some bad news: we’ve decided to let you go, because...”

At this point, it’s possible that the employee may attempt to bargain, or become combative. You can express regret about the situation, but avoid the temptation to become defensive, hesitate, or engage in a verbal joust. You’ve made this decision because you believe it’s in the best interests of your business, and it’s final.

Address any technical questions the ex-employee has.

There may be concerns around severance, unused vacation days, or other matters you hadn’t considered yet.

Be kind. If you believe the ex-employee’s potential lies elsewhere, offer to help.

For long-term employees in particular, being fired is a traumatic experience: it can damage their self-confidence, entail the severing of personal and professional relationships, and result in loss of income and abandonment of plans. It is appropriate to show compassion for people facing such circumstances, especially when you are the proximate agent thereof.

Sometimes a staff member who shows talent and potential in certain areas just isn’t the right fit for the position s/he occupies at your business. If you simply can’t find a place for that employee in your organization, you can still offer to ask around or provide a reference.

Parting on amicable terms isn’t always a realistic possibility, but it certainly makes for more pleasant professional relationships down the road.

Wednesday, February 10, 2016

Optimize the Employee Performance Review

In today’s technology-intensive business climate, employers must be able to accurately gauge the evolving needs of their enterprise, how individual employees are coping with change, and how each staff member’s role is shifting relative to h/er original job description. The individual employee performance review can be an effective tool for measuring progress, and for improving productivity, morale, and relations between managers and staff. But it can also be a waste of time if the participants are unprepared.

Prepare for the performance evaluation in advance and pay attention to details. Here are some areas you may want to consider:

  the employee’s professional rapport with h/er co-workers, superiors, and subordinates

  skills and execution in key areas like organization, timely response to e-mails and phone messages, courtesy toward clients (barring exceptional circumstances), and completion of tasks ahead of deadlines or key dates

  any comments or feedback, whether complimentary or otherwise, about the employee from h/er colleagues or immediate supervisors

  opportunities for professional growth, on-the-job training, and skills upgrades

It is wise to give an employee plenty of notice that a performance review is forthcoming, and remind h/er a few days before the meeting. This will give h/er time to identify issues that s/he may want to raise, including h/er goals within the organization, and areas where s/he may need additional support.

Hold the evaluation in a confidential space, and set an agenda.
Dedicate a certain number of minutes to each area you’d like to discuss; aim to stay more or less on topic and on schedule. Confidentiality is important. You don’t want everyone in the office to know your opinion of the employee, and the employee won’t want rumours about h/er strengths, weaknesses, impressions of relationships with colleagues and professional goals to spread.

Don’t leave compensation to the end.

Employees are understandably interested to know the level of compensation they can expect today and in the future. If the individual you’re evaluating senses that you’re glossing over the subject or avoiding it, it could become an elephant in the room. And distractions of that magnitude during an evaluation are never helpful.

Whether you believe a raise is in order or not, state your position and your rationale. If possible, try to put a positive spin on a non-raise by hinting at actions your employee can take to qualify for a salary bump and increased responsibility. Staff who feel that their pay is arbitrary, or that their career is stuck in neutral, may become discouraged and contemplate moving on.

Ask questions, and provide opportunities for your counterpart to do the same.

You may have formed a certain impression of the employee and h/er performance already, but it’s still important to hear the other person’s point of view. You could even begin the meeting by asking the employee to evaluate h/er own performance, and compare that assessment to your own.

In the event of an underperformance, there may be confounding factors you haven’t accounted for. On the other hand, if an employee is enjoying success, s/he may offer an explanation that will enable you to foster h/er continued success.

Finally, just as you would at the end of a job interview, reserve a few minutes for the employee to ask questions, raise concerns, and pitch ideas of h/er own.

Make sure you’re on the same page.

Review the key points raised during the evaluation as it draws to a close, and ensure that you both (employee and manager) understand and accept your expectations of each other, and your responsibilities moving forward.

Wednesday, February 3, 2016

Which Comes First: Happiness Or Success?

We all know the paradox of the chicken and the egg—historically, one must have preceded the other. Drawing on Darwin’s theory of evolution, we can surmise that the familiar chicken must have evolved in phases, first from reptile to bird through natural selection, and then from wild pheasant to domesticated fowl through artificial selection. So the first “chicken” probably hatched from an egg laid by a pheasant-like animal that wasn’t quite a chicken. But then, what distinguishes a chicken from a not-quite-chicken? It’s all very complicated.

Happiness and success are also strongly correlated, and at first glance, the question of which occurs first would seem to pose a similar intellectual challenge. In fact, much academic literature supports the presence of a causal relationship that may seem counter-intuitive: happiness promotes success, but success doesn’t necessarily promote happiness.

Why is this? And what are the implications of this relationship for the way we organize our personal and professional lives?

The evidence
In his bestseller The Happiness Advantage and in his popular 2011 TED Talk, positive psychology expert Shawn Achor draws on his own extensive research—including case studies at Harvard University and in the private sector—to argue that happiness is a catalyst for success in both academic and professional endeavours. He also alludes to a growing body of knowledge in the fields of neuroscience and positive psychology that buttress this conclusion.

An explanation Achor offers for the failure of measurable success to consistently induce happiness, is the problem of moving goalposts. Once we reach a particular goal, we tend to immediately adopt a more ambitious one. While goal-setting and ambition are generally desirable traits, aspirations can become unhealthy if we view them from a glass-half-empty perspective, don’t take time to acknowledge our achievements, and constantly berate ourselves over a perceived failure to attain “real” success. To paraphrase Achor, by framing happiness as a product of success, we indefinitely push both happiness and success beyond our cognitive horizon. And in turn, the absence of life satisfaction here and now can actually hamper our future prospects.

Tips for boosting your day-to-day positivity

  Show gratitude to the people who contribute meaningfully to your life, including colleagues, friends, and loved ones. Reflect on your accomplishments with pride, and  take time (3-5 minutes) to actively appreciate the positives. Try making a daily journal entry of three things for which you are grateful. Over time, this exercise will train your mind to seek out opportunities rather than dwell on hazards.

  Keep calm and manage your schedule so as to mitigate stress. Chip away at long-term projects incrementally to avoid procrastination-induced deadline anxiety. Focus on conserving energy throughout the workday, so that you keep some in reserve for recreational activities, quality time with friends and family, and hobbies while you’re away from the office. When stress shows up (and it occasionally will), embrace the challenge and think about how great you’ll feel once you’ve conquered it.

  Be kind to others. This is a win-win: agents and recipients of compassion both tend to experience higher levels of life satisfaction. Random acts of kindness, which could be as simple as sending a brief e-mail to show appreciation for the efforts of an employee or co-worker, can make an enduring beneficial impact on the culture of your workplace.

  Clear your head. Sometimes in order to refocus, we need to temporarily un-focus. If you experience a feeling of stagnation at work, try stepping away for a while and enjoying a pleasurable activity. Upon your return, you may be pleasantly surprised by the ease with which your work flows, and by the new insights and creativity your mind generates.

  Eat healthy, balanced meals and allocate enough time for them that you avoid constantly “eating on the run”. Feelings of burnout, irritability, and energy lapses are often at least partly attributable to inadequate nutrition.