Marijuana- What Employers Should Know

This week’s blog from Lauren Burgon

Washington voters approved Initiative 502 on November 6th leaving many Washington employers wondering how and if they should be amending their policies regarding drug use.

While the passage of Initiative 502 decriminalizes, regulates, and taxes the recreational use and sale of marijuana in the state of Washington, marijuana use and possession remains illegal under federal law.  The new law does not grant new rights to employees with regard to drug use, and zero tolerance policies may still be enforced.  The new law does not contain a provision that would protect employees’ use of the drug at work, nor does it provide individuals protection if they have traces of the drug in their systems while on the job.  In fact, Intuitive 502 is largely silent about its effect on the workplace.

However, the passage of Initiative 502 represents another step in the continuously changing legal landscape regarding marijuana.  When medical marijuana laws started emerging, they sparked lawsuits across the country as employees challenged terminations due to medical marijuana use.  Intuitive 502, while not granting additional rights to employees, is likely to spawn similar lawsuits.

It’s expected that Washington courts will likely rely on its earlier decisions regarding medical marijuana to reject legal challenges to employee terminations based on Initiative 502.  However, as defense costs can be considerable, employers should take steps to avoid becoming the next “test case” in the ongoing evolution of this area of law.

Here are some steps that Washington employers should consider taking:

  • If you don’t already have a written policy addressing illegal drug use in the workplace, consider adopting one.
  • If you do have a written policy addressing illegal drug use in the workplace, revisit it in light of this new law.
  • Any written policy needs to clearly define “illegal drugs” making it clear that if a drug is illegal under either state or federal law, the employer will consider the drug illegal.
  • Consider if you want to include drug testing as part of the policy.
  • Multi-state employers should ensure that their policies comply with state laws that regulate testing, such as Alaska and Idaho, to take advantage of the additional protections that those laws provide.

Hiring and Promoting the Best People that Fit into Your Organization

Our guest blog post is from Bert Holeton, President of The Mastermind Group (www.the-mastermind-group.com). 

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When it comes to choosing the right individual to join your organization, or the right individual to promote into a key position, or the right combination of individuals to form a team – it’s all about performance and fit. To get PERFORMANCE, you need to be able to:

- Select the right people for the right positions

- Develop the right people to be their best and deliver results

- Transform groups of people into high-performing teams

 

The right FIT elevates the performance of the right people – but fit to what?

- Their responsibilities

- Their direct supervisor

- Any group of people they need to team with

- The culture of the organization

It is possible to PREDICT PERFORMANCE AND FIT before you make decisions about people. Here’s what you need to know:

Passion & Purpose: What lies behind our innate and unchanging nature. What are this individual’s core values and purpose in life?

Experience & Knowledge: Our education, work experience, training, industry knowledge, and skills. What verified experience and knowledge does this individual bring to the position?

Critical Thinking: Our capacity to perceive the core issues that are driving the problems, conceive workable solutions to those problems, and implement those solutions. What is this individual’s capacity to leverage his experience and knowledge in this environment?

Focus of Thinking: The natural priority path we follow to face challenges, solve problems, and make effective decisions. How will this individual naturally choose to implement his critical thinking?

Workplace Motivators: The factors that drive and motivate us in the workplace, which influence our decision-making and impact how we apply ourselves. How will this individual prioritize his focus of thinking?

Natural Behaviors: The way we each deliver our focused critical thinking and core values into the world. How will this individual naturally tend to act on his motivations?

Team Dynamics: The way in which people work together – on a project team, an executive team, or a board of directors. Is there a strategic fit (alignment) or a tactical fit (balance)? Are there any potential problems – such as too many similarities, too many differences, or missing talent in any area?

Armed with this awareness, you can make people decisions that:

- Retain high-performing employees

- Increase individual and team morale and satisfaction

- Improve decision-making to achieve better results

- Align your people to the corporate goals

Balancing Capacity and Sales for Profitability

Our guest blog post comes from Julia Robinson, Managing Partner at Steller Solutions, a consultancy that partners with organizations to improve profitability, lower operating costs, and develop loyal customers.

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What’s the link between sales, profitability targets and capacity planning?  How do you grow your sales, optimize capacity and maintain the level of quality and service that your customers require?   Let’s start by looking at profit, which is simply your sales revenue minus your costs.  If you increase your sales, but your operating costs go up, your profits decrease.  If you increase your sales, keep your operating costs low, but low quality and service result, the increased customer service costs will take a bite out of the profits and often result in less future orders.  Understanding the connections between sales, operating costs, capacity, profits and the drivers to improve each of these factors is critical in making a plan to grow or profitably sustain your business. 

Grow your sales to correspond to your capacity.  If you’re looking at increasing your capacity, make sure that you’ve considered how you’ll generate the additional sales corresponding to that increased capacity.  We’ve seen businesses acquire a bigger space, new equipment and recruit talent to provide key production capabilities.  But if there’s not a plan for bringing in the sales to take advantage of that increased capacity capability, it’s just increased overhead; a fixed cost.  And if there’s anything that will hurt your cash flow and bottom line, it’s high fixed costs.  Some questions to ask yourself are:  How much market share is out there for the taking?  Do you know what makes you better than your competitors?  Do you have an executable sales plan?  Do all your sales people have the talents and training to be a top sales performer?  Make sure that you’ve laid the groundwork for getting that additional business so you’ll be reaping the benefits of your increased capacity in profits.

Know your optimum capacity and the effect of quality.  Another common mistake is assuming you know your optimum capacity.  Typically businesses have an idea based on their existing operations what their ideal capacity is.  But before you base your target business goals on that optimal capacity number you’ll want to ask a few questions.  What effect does quality have on your capacity?  Has the waste been cut out of your operational processes?  Have you defined value in the eyes of your customers?  Every time a mistake is made or things aren’t done right the first time at any step in your process, that translates into wasted material, labor and time, which results in decreased capacity.  In our experience, businesses that have gone through the exercise of improving their quality and cutting the waste from their processes, their optimum capacity significantly increases – often by 50-100%.  And by coupling improving quality with increased capacity they are able to retain current business and gain new business.  These businesses can produce more in less space, which allows for opportunities of either staying in current facilities, instead of moving to larger facilities or reducing the amount of space needed, sometimes allowing businesses to reduce the number of building required, reducing the fixed costs of the business.

Leverage your optimized capacity, high quality and sales for increased profitability.  By utilizing a multi-pronged approach of optimizing your capacity, focusing on quality and executing a sales plan to increase sales; you are in position to operate more profitably. You can leverage your optimized capacity by lowering your prices, having a higher profit margin, investing in innovation, research and development or increasing your flexibility with customers.  Increased flexibility with customers can translate into options in lot sizes, model types, multiple features or colors. Consider your market and what sets you apart from your competitors in choosing how you will leverage your optimized capacity. 

Keeping your organization focused on the goals of target sales, optimized capacity, high quality and service enables your business to maintain competitiveness and increase profitability.

Capacity Optimization in Business

My experience with the operations side of business was fairly limited prior to business school, so I found my Operations 101 class to be eye-opening.  I specifically remember reading the book “The Goal” by Eliyahu M. Goldratt, where business operations are compared to a line of boy scouts moving through the woods. The analogy is unbelievably simple, yet it creates a very clear picture of how operations can be held up by a single resource.  

In working with and managing businesses, I personally find the operations component to be one of the more difficult – yet when you bring it back to Goldratt’s analogy, it’s really not so complex. Generally, optimal capacity exists when business operations are flowing smoothly and each member of the team is fully utilized in his or her job. 

The first step to understanding your business’ capacity is to know what skills the company needs.  To do so, you must be aware of what processes are performed in the company daily, weekly, monthly, quarterly, annually, and ad-hoc.  Documenting processes is a critical element of optimizing operations – if you don’t know what needs to be done, how can you be sure you are able to deliver efficiently and consistently?  Documented processes also drive efficiency.  When the team can see how goods or information flows through the organization, they will be better able to envision where they fit in and make suggestions to improve the overall process by recognizing and eliminating redundancies or bottlenecks.  A bonus to documenting processes is that it will make your customers happier.  Inconsistency in delivery will drive complaints and liability. 

Based on the processes documented, you can then understand what skills are needed.  This information is used to create job descriptions that target the right person for the job.   Clear job descriptions that are matched with their corresponding processes create an organization that smoothly operates.  When a disruption occurs in the business, it becomes simple to uncover the breakdown and determine if it’s systematic or an unusual circumstance.

Finally, optimization requires an understanding of the demand cycles of the business.  There are many demand cycles in a business and these demands should be analyzed both at the company level and within each process.  For example, a company may have a cyclical or seasonal sales cycle.  The company then can plan for up times and down times and utilize its resources based on this knowledge and experience.  Similarly, a particular employee or resource may have demands at certain times of the month or the year. 

A great example of a company with varied resource utilization is a CPA firm.  These companies know that their busiest times for tax professionals are February through April and September and October.  Their resources are completely maxed out.   In addition, this is when much of their revenue comes in the door.  At other times of the year, they are less busy and need to seek other ways to bring in revenue.  Alternatively, the company’s internal accounting team may have a completely different demand cycle.  They are busiest at month end for invoicing, quarter end for reporting, and year end for internal tax preparation.  These resources function on a different cycle than the tax professionals but are likely be impacted by the overall business cycles.  These considerations must be taken into account in resource planning.  Only an understanding of how the pieces fit together – process, people, and demand cycles — will enable the firm to efficiently operate at capacity year round.

Marketing: The Key Differentiator

Josh Anderson of One-Into-Many is our guest blogger this week.  He offers a great summary of our Equinox Focus topic “Reconceptualizing Your Business.”   Josh is also a founding member of the Advantage Consortium.

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Everyone is fighting to differentiate themselves in the market. A market that has become commodity oriented. They are asking for more value at a less cost. None of us like competing in this environment. Something needs to change.

Ok, so you know you have to think about and do business differently.  But what does that mean?

As you peel back the layers and begin to understand your core value, a level of excitement rushes in.  Suddenly people in your organization get a sense of vigor as the focus starts becoming clear.  The question is does anyone else care about your value?

So we are challenged to find the market for our value and then to described that value in their terms.  The natural instinct is to error on the side of not saying words that might dissuade a potential buyer.  Stories and messaging end up being broad and encompassing of many potential customers for fear of losing even one good selling opportunity.

This thinking is having disastrous effects as companies move from the information age to the conceptual age.  As they move from local competitors to worldwide competitors, their story and messaging is lost and ignored. Their efforts are left for dead.  The common fix?  Get better at sales

How’s that working for you?

Conceptual Age businesses put the marketing discipline front and center.  It becomes the foundation from which they build all relationships with suppliers and customers.  It becomes the core system they test and measure continuously.  Marketing efforts become focused and speak directly to a very narrow segment of the market…a market that is controlled with virtually no competition.

So what does doing business differently mean?  It means using marketing to produce results that are unthinkable today.

Welcome to the conceptual age.