J. Miller and Company Blog

November 29, 2002

On Enhancing the Value of Your Business & Connecting Employees to their Jobs

San Francisco Chronicle, October 26, 2002: Dave Murphy, a Sunday columnist in the Business Section, discussed the importance of getting employees connected emotionally to their jobs. Quoting from “Follow this Path” by Curt Coffman and Gabriel Gonzales-Molina of the Gallup Organization “Employees don’t leave an organization because of rational reasons. Employees don’t commit to an organization because of rational reasons.” The book is based on Gallup’s studies of more than 3 million employees and 200,000 managers.

Read the article on www.sfgate.com.

The Contractor’s Management Journal, November 2002:

Value Drivers: Enhancing the Value of your Business” by George H. Reddin (pg. 13) discusses the perceptions often held by company owners relating to the value of their businesses. He identifies the “factors which drive value” as follows:

  • Operating performances and efficiency
  • Financial condition
  • Business risk and diversification
  • Management quality and depth
  • Growth potential
  • Organizational and non-income issues

Read the article at: www.fml@fminet.com.

Business Week, October 21, 2002:

The column entitled “Interest Rates-Another Hurdle That’s Tripping up Business” (pg. 41) discusses the fact that the cost of borrowing for corporations (but not consumers) “has risen by almost a full percentage point since early 2001.” The next paragraph goes on to explain that “real interest rates are defined as market interest rates minus core consumer inflation” and that, by this standard,, corporate borrowing has become cheaper. The crux of the issue is that corporations are unable to raise their own prices at the same rate as consumer inflation, thus causing the increased disparity between the costs of capital for companies versus that of consumers.

Read this article if for no other reason than to remind yourself that economic relationships are much more complex than we often imagine.

Fortune, October 28, 2002:

The cover article “Is Real Estate Next?” by Shawn Tully (pg. 59) argues that “US housing prices are stretching the outer limits of what’s reasonable and sustainable.” She quotes Mark Zandi, an economist, who says “Every day prices rise, the risk gets greater that a bubble will form – and unwind in an ugly way.” With speculation creeping into the housing market around the country the rise in prices fueled by low interest rates accounts for only a part of the increase.

With much of the stability of consumer spending based on the impact of re-finance dollars, any downward trend in housing prices could spell disaster for the economy as a whole, not just the remodeling market.

The last page of the article includes a “Buyer, Beware – Not Scared” sidebar which discusses, among other issues related to the equity which resides in your home, how to decide whether or not to mortgage-up to a larger house.

Read it at http://www.fortune.com/fortune/investing/articles/0,15114,371241,00.html.

“Investing: Time for a Checkup” (pg 211) reviews the continual requirement of re-allocating your portfolio, even during a down market.   The article discusses ten top funds to include in a retirement portfolio and reviews asset allocation by age segment.

Read it at http://www.fortune.com/fortune/investing/articles/0,15114,370344,00.html

Journal of Light Construction, October 2002:

First – congratulations to JLC on their 20th year anniversary. This magazine has gone from being an over-sized quaint, but relevant, publication issued from the great northern woods of Vermont to a national leader in educational efforts focused on the building trades. Keep up the good work!

The October issue is a must-read and must-keep: Best-Practice Construction Details from two decades of JLC discuss everything from Foundations & Sitework issues to Kitchen & Bath Rough in. This would be a great issue to buy for every member of your team and to use in Production meetings to discuss quality control issues from the field perspective.

“Five Reasons Contractors Lose Money” (pg 43) by Sal Alfano outlines the primary reasons smaller remodeling companies don’t make sufficient profit to remain in business over the long-run. But one of the reasons, “Can’t Say No” applies to company owners of all sizes.

From the JLC website, (www.jlconline.com) enter “Strictly Business” in the center of the Search Results table: you will view the first 100 words of the monthly columns on this subject. For $3 you can download a pdf file and read the entire column.

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