It’s well known that job growth has been lacking in this economic recovery. One reason for the disappointment is that small businesses aren’t adding workers like they used to.
Small firms account for about half of GDP and employ about half the workforce. Small business has led us out of recent recessions and has been the driver of our economy for the past few decades. But Goldman Sachs economists recently found small firms (defined as businesses employing less than 1-49 workers) have indeed underperformed medium and large companies.
These trends also contrast with the last business cycle of the early 2000s. Small firms barely lost any jobs in the 2001 recession and then outpaced medium and large firms in the expansion.
Goldman identified several reasons unique to small-company hiring.
First, small firms account for a disproportionately large share of construction jobs and those payrolls collapsed during the Great Recession.
Second, labor markets have seen a structural shift toward large company jobs. For instance, Goldman notes large companies’ share of retail employment has jumped 16 percentage points from the early 1990s to 64% today. Many mom-and-pop stores can’t compete against big box retailers.
Finally, large-business employment has tended to be more sensitive to the business cycle. When the U.S. recovery strengthens, big firms benefit a bit more.
The lag in small business hiring is also confirmed by ADP private sector numbers. Payrolls at private firms with less than 50 employees have increased 4.7% since the end of the recession through August, medium-size firms (50-499 employees) are up 6.1% and large firms (more than 1,000 workers) have increased payrolls by 7.4%.
While U.S. high school graduation rates are rising, much improvement has to be made.
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Top hedge fund manager earns more than $1 Million per hour!
The top 10 hedge funds managers make as much as 196,000 registered nurses or 250,000 entry level teachers. They make 50 to 100 times more than our top athletes, movie stars, CEOs, lawyers, writers, doctors and celebrities. The top hedge manager, David Tepper, earned $1,057,692 an HOUR in 2012 — that’s as much as the average American family makes in 21 years!
Number of people with dementia to double
Dementia affects a large and growing number of older adults in the United States. The estimated prevalence of dementia among persons older than 70 years of age in the United States in 2010 was 14.7%. The monetary cost of dementia in the United States ranges from $157 billion to $215 billion annually, making the disease more costly to the nation than either heart disease or cancer.Medicare paid approximately $11 billion of this cost. The costs and the number of people with dementia will more than double within 30 years.
Now get your head out of the gutter. It’s not what you’re thinking. WTF? is the question posed by Brian Solis in his new book, What’s the Future of Business? While previewing his video and Slideshare presentation, I discovered these nuggets:
- Over 40 percent of the companies that were at the top of the Fortune 500 in 200 were no longer there in 2010.
- Gen Y will form 75 percent of the work by 2025 and are actively shaping corporate culture and expectations. Only 11 percent define having a lot of money as a definition of success.
- Only 7 percent of Gen Y work for a Fortune 500 company. Start-ups dominate the workforce for this demographic.
Finally – I love this quote.
“in the end, complacency is a symptom of mediocrity and mediocrity is the result of a leadership organization that chooses not to lead, but instead, to manager how to be better or more efficient around “what is” and not “what should be” or “what’s next.” Brian Solis
While changes are transforming almost every industry, perhaps no individual profession will be impacted with the next few years as much as healthcare. And within that industry, no single job will be revolutionized as much as the medical billing coder. The looming transition from ICD-9 to ICD-10 will alter the profession and those directly responsible for accurate and prompt reimbursement for services.
(Note: ICD is International Statistical Classification of Diseases and Related Health Problems, a medical classification list by the World Health Organization (WHO). It is used by 25 countries to report medical diagnoses and inpatient procedures. Accurate and prompt patient reimbursement by both governmental agencies and insurance companies rely on correct coding by hospitals and physicians offices. Delays in coding may result in inaccurate payments, higher accounts receivable, and more out-of-pocket expenses by patients or write offs by offices and hospitals.)
It is estimated that the complexity of the work and scope of managing the addition of more than 56,000 codes, a 5+ times increase, will result in productivity drops of 50 percent or more. As a result only half the work will get done or twice as many coders will need to be hired. And there lies the first of several problems facing hospitals and physician offices.
A lot of coders currently have just basic medical knowledge. That isn’t going to be enough. It is estimated that half of the coders today do not have enough education to make it. This alone will change education requirements and, subsequently, the type of individual capable of the work and attracted to a career in coding. ICD-10 requires a higher level of clinical knowledge than many Certified Professional Coders (CPC) have. If they haven’t prepared for that, they will be left behind. It will be a completely different world in coding going forward.
The magnitude of the change is significant. ICD-10 is not merely a modification of ICD-9 – it’s a disruptive change that relies much more on tacit knowledge than explicit information, something largely ignored by administrators and human resources.
What coders see no longer results in the conclusions you want – coding is no longer plug and play. This creates a critical and dangerous environment since efficient and accurate ICD-10 is required if the medical community wants to get reimbursed what they are due in a timely manner.
To understand the difference between just explicit information (know-that) and implicit knowledge (know-what and know-why), the iceberg metaphor is often used. Above the water lies the information that we know and can articulate without prompting. It is visible, readily available and shared by whoever wants it. It is simply explicit. Explicit knowledge is codified and easily transferable in systematic methods, such as rules and procedures.
You can ask a know-that question to just about anyone in a job and they can likely regurgitate it back even if it doesn’t have anything to do with their job. You can compare explicit knowledge activity to snorkeling verses scuba diving. Snorkeling is relatively easy and safe and fun. Most training programs and just plain old writing-down-what-you-do fits into this level of knowledge.
Most of us can articulate explicit knowledge, what we call knowledge at this surface level, if we are prompted. This is what most assessments for certification and skill proficiency evaluate.
Below the waterline lies tacit knowledge, or implicit knowledge. Employees floating below the surface are often the organization’s subject matter experts. They hold the technical and some company and industry knowledge that is revealed when they are asked. Few employees actually live in this space. And this is where things begin to get a bit more complicated. Knowledge near the water surface is still fairly easy to work with.
As outsiders or new employees enter an organization, they seek out these “snorkelers” to find out how to get things done. The problem with the ICD-10 transition is that there are few scuba divers and lots of snorkelers. And transforming knowledge from divers to snorkelers diverts the skilled from getting their jobs done at a time when productivity is already diminished by the massive requirements of ICD-10.
Tacit knowledge on the other hand is non-verbalized and intuitive. It is deeply rooted in an individual’s actions and experiences. Experts often arrive at problem diagnoses and solutions rapidly and intuitively without being able to report how they attained the result (tacit knowledge).
As we dive deeper into the water, the nature of this tacit knowledge changes. The view becomes murkier. It is harder to see ahead and get a handle on things. Like the iceberg, the deeper you go the knowledge becomes more complex and vast. At these levels, we begin to see all the different reasons why our tacit knowledge is unspoken.
Tacit knowledge rarely if ever is recorded. It often lies deep inside the minds of the employee. It is difficult if not impossible to capture. It’s not as easy as saying “Let’s find out what we know and then document it.”
That poses a gargantuan problem. Tacit knowledge is what we know and believe but cannot articulate, often because it has become so ingrained in our minds that we cannot separate it from who we are. That means if skilled workers leave, they take institutional knowledge with them along with the skills to do the job.
The timing for ICD-10 couldn’t be worse for healthcare. Complex, new problems need tacit knowledge to solve them but few people have the experience. A less experienced individual (which is nearly every coder at this point since ICD-10 is so new) have to rely on explicit knowledge. But because a whole new pool of rookie coders will be needed to complement the existing shrinking pool of skilled codes, most coders will have to rely on what they know in a job that requires application and critical thinking skills to bridge the gap between data and conclusions.
Transferring essential knowledge to a horde of snorkelers (and likely even inexperienced swimmers) quickly seems to be an impossible task. This tacit knowledge however is exactly the knowledge that organizations need to capture. It is the competitive advantage of an organization, held by a few people who make the connections between all the content that differentiates your organization from the competition.
The bottom line is that essential and valued coder skills will be needed for managing, interpreting, validating, transforming, communicating and acting on ambiguous and fast changing information. And those skills are and will be at a premium.
Yahoo’s recent decision to ban telecommuting has created quite a buzz. Reactions have ranged from outrage to praise. You could almost hear the huge sigh of relief expelled from managers worldwide who hate the concept of workers working from home and can’t give up the anachronistic style of management by walking around.
Time will only tell if Marissa Mayer’s decision will lead to her induction into the CEO Hall of Fame or Den of Shame. (Remember former CEO “Chainsaw” Al Dunlap?) But as an outsider looking in, the decision is rife with pitfalls and consequences and lots of bad examples of how to communicate with your employees.
Like many other observers, I don’t have inside information to the discussions and strategies leading up to this decision. All I get is what I read in the news and on blogs. In that vein, let me first say that I believe the announcement was likely taken out of context and subsequent responses were exaggerated, often to fit personal agendas. Regardless, nearly everyone agrees that the impact at Yahoo will be significant. Whether that impact is good or bad remains to be seen.
Now let me move on to my take on this decision.
First and foremost and most curiously, if face-to-face interaction is so valuable and productive, why was a memo sent? Why wasn’t a meeting of managers called to announce, explain, and discuss the decision? Why weren’t the people most affected by the decision contacted prior to any memo being circulated, confidential or not?
While creativity may be enhanced by face-to-face collaboration, the potential loss of key talent and acquisition of new talent comfortable with going to work each day may overwhelm any advantages gained by ending telecommuting. Even if the strategy turns out to be the right one, the tone of the message was harsh and cold. It read like a mandate, not a hard-to-swallow but necessary “Win One for the Gipper” rally the troops speech.
The decision was also interesting considering the new-Mom status of CEO Mayer. With 50 percent of the workforce now women, many working Moms and parent caregivers depend upon flexible, more compassionate, less autocratic leadership styles and work environments. Many of the most successful recruitment and retention efforts succeed based on the flexibility that telecommuting offers.
Yahoo recruits mostly college grads. Well over 60 percent of college students are female. It is even higher in many graduate programs. This decision paints Yahoo as a non-worker-friendly, non-family, non-work-life-balance workplace. That image excludes an even larger demographic necessary for recruitment. I assume that message wasn’t the intent and consideration for the impact on women, young workers, and college grads was given adequate scrutiny. But if it was, the message certainly wasn’t communicated clearly.
In coming weeks and months, it will be interesting to watch overall employee engagement. Will incumbent employees react positively to this definitive decision or view this dramatic change in policy as a last act of desperation from the captain of a singing ship? Some observers have even intimated that voluntary downsizing – employees leaving the company in response to the policy – might be behind the decision. This change could very well cause employees to quit before they are terminated, eliminating expensive severance packages and prolonged employment of disgruntled employees.
I’m also curious to know what type of innovative breakthrough Mayer is looking for that might be gained by forcing employees to “work side-by-side.” Few could argue with the comments by Yahoo EVP of People and Development Jackie Reses that “some of the best decisions and insights come from hallway and cafeteria discussions, meeting new people, and impromptu team meetings.” If occupying the same space is a requirement for collaboration, does that mean that Yahoo will be consolidating their 20+ global offices in California and requiring all its employees to travel regularly or move closer?
Yahoo needs a big bodacious breakthrough and maybe on-site collaboration is the right catalyst to jumpstart innovation. But employee performance and productivity must be aligned with a strategy. What is Yahoo’s strategy? Better yet, what is its purpose, its unique proposition? Who is Yahoo and what does it do? If its goal is to be a better Google, Yahoo will lose. With three CEOs in a twelve month period, you have to ask – what is its business model? Does it even have one? You can’t expect employees to meet expectations if the only goal is inflating its stock price. If Mayer is looking for its workers to come up with the next great idea to save the company, banning telecommuting has as much chance of succeeding as rearranging the deck chairs on the Titanic.
Reses’ memo continues, “speed and quality are often sacrificed when we work from home.” Maybe that’s true in some roles. But imposing this policy for all types of work just doesn’t make good business sense. It also flies in the face of recent studies on the value of telecommuting. In 2012, the Bureau of Labor Statistics conducted a survey concluding that telecommuting has “become instrumental in the general expansion of work hours, facilitating workers needs for additional work time beyond the standard workweek, and/or the ability of employers to increase or intensify work demands on their salaried employees.”
While creativity and innovation may flourish when engineers and marketing people interact face-to-face, a no-telecommuting policy may have a negative impact on more functional jobs like finance and accounting. It might reduce productivity and performance by lowering morale and limiting the pool of talent that the company attracts and retains.
Yahoo’s decision to ban telecommuting offers many valuable lessons for companies considering a significant policy change. What do you feel are the most valuable take-aways for CEOs and HR when making significant employee policy changes?
The United States has become a nation of “non-tinkerers,” a survey shows, and it may harming the way we live and work according to manufacturers.
In a poll of 1,000 U.S. adults, nearly six in 10 said they had never made or built a toy. Twenty-seven percent had not made or built even one item from a list of eight common projects, including furniture and a flower box. Sixty percent avoided doing major household repairs themselves, noted the survey from The Foundation of the Fabricators and Manufacturers Association, based in Rockford, Ill.
“Many Americans simply do not work with their hands anymore, whether it’s to tackle a hobby for pleasure or to handle a necessary household repair. Young people essentially have no role models when it comes to fixing things or taking pride in building something,” said Gerald Shankel, the Fabricators and Manufacturers Association president.
There’s a growing shortage of tinkerers and people with hands-on skills in the workplace. Many studies predict a severe labor shortage as waves of blue-collar workers reach retirement age. A national poll of 500 teenagers, however, showed that 73% had little or no interest in those hands-on careers. Six in 10 teenagers had never visited or toured a factory, according to another The industrial heritage of the United States was based on tinkerers. In the future, who will fix our running toilets, creaky doors, and stalled engines?
I’ve written many articles and blogs about how the definition of work and the meaning of a career has changed. In the past differences have been targeted at age demographics and/or generations. But today the new paradigms are pervasive and affect workers and employers regardless of age, generation, or geography.
Below is a table highly the old verses new paradigms about work and careers.
|Job Security||…||Employability Security|
|Longitudinal Career Paths||…||Alternate Career Paths|
|Job/Person Fit||…||Person/Organization Fit|
|Organizational Loyalty||…||Job/Task Loyalty|
|Career Success||…||Work/Family Balance|
|Academic Degree||…||Continuous Relearning|
|Full-Time Employment||Contract Employment|
|Single Jobs/Careers||…||Multiple Jobs/Careers|
|Change in jobs based on fear||…||Change in jobs based on growth|
|Promotion tenure based||…||Promotion performance based|
There is an elephant in the management suite – an impending talent pipeline crisis. The crisis doesn’t stop at the top. There is also a serious shortage of skilled workers for key positions, from maintenance positions to service technicians to nursing. The problem is only going to get worse. Succession planning needs more attention than lip service.
According to the Department of Labor by 2018, 1 in 4 workers will be over the age of 55. The need to build a talent pipeline is critical and the clock is ticking.
The process of building this pipeline is often called succession planning. Unfortunately the mere mention of succession planning infers senior leadership. At best it reaches down the ladder to management. But rarely do organizations identify critical key roles that left unfilled or filled with the wrong employee could cost the organization revenues and competitive advantage.
Just yesterday morning I described to a local SHRM chapter why the scope of succession planning in most organizations is too narrow. A definition from a State of Iowa Workplace Planning document offers one of the most accurate and inclusive descriptions:
Succession planning is a process whereby organizations ensure that employees are recruited and/or developed to fill each key role within the organization.
A recent article described two types of succession planning: Operational Workforce Planning and Strategic Workforce Planning.
Operational Workforce Planning typically occurs with your annual budgeting cycle and forecasts staffing needs and planning for the coming year to 18 months. Sixty-seven percent of all companies conduct workforce planning on a purely operational and as-needed basis.
Strategic Workforce Planning looks into the future planning for and evaluating your organization’s staffing plans and forecasts one to five years even ten years into the future. A Strategic Workforce Plan is a full-scale evaluation and plan that identifies rick, change, and potential areas of opportunity.
To management, a strategic workforce plan looks like a daunting task. To some extent it is. But the failure to identify the risk factors associated with retaining and recruiting for key roles is significant.
During the SHRM meeting, a few members identified key positions in their organizations that remain unfilled and the risk for future openings was high. The HR manager for a poultry processor noted that the lack of maintenance workers put quality and safety at risk. A manufacturer cited the inability to recruit service technicians (installers) as one reason production has been cut and revenue projections reduced.
Despite the known and associated challenges of recruiting skilled workers not a single hand was raised when I asked the following questions:
- How many organizations have identified the risk of loss for critical employees/positions?
- How many organizations have identified the competencies required in critical positions?
Organizations must begin to stop giving lip service to the importance of succession planning. According to a new CareerBuilder study, seven out of 10 workers admit that they search for jobs as part of their “regular routine.” Thirty-five percent say that they start searching for a job within weeks of starting a new position. The risk of losing additional key employees in the future is substantial. The risk is imminent.
It behooves every organization – large and small – to take time to build a critical talent plan and pipeline. I offer the following 8 steps.
- Determine current and future needs.
- Develop the ideal employee profile for at-risk key positions.
- Assess internal talent inventory.
- Identify the gaps between available and needed talent.
- Develop current talent and track progress.
- Identify the best strategies for acquiring talent from outside the organization.
- Assess and refine sourcing, screening, and selection strategies.
- Execute, monitor, refine….and monitor again.