Has something like this ever happened in your contracting firm....?
One of your best salespeople -- call him Jim -- went into a slump for several months. Jim seemed to be working hard; no one was sure exactly how he spent his time, but it was clear that he just wasn't putting deals together. He began to draw criticism from top management for the lack of productivity.
One day, Jim left, and went to work for your competitor.
At first you felt relieved to be rid of a potential problem employee. Soon, however, you notice your competitor's sign appearing on large new construction projects all over town. Some of these projects were ones your company had been bidding, but others you didn't even know about beforehand.
And you began to wonder . . . should these have been MY projects? Why wasn't Jim pursuing these leads? Or was he? Maybe you suspected that Jim had been developing these leads on 'your nickel' before he walked out the door and handed them to your competitor!
And now what can you do about it ???
Well, as far as the existing situation regarding Jim, you may not have many options. If the amount of business Jim took with him is substantial, you should probably talk with your attorney about possible legal remedies. We aren't going to talk about lawsuits here. What we are going to talk about is how you can MANAGE SMARTER to avoid this situation in the future.
There are at least 5 THINGS YOU MUST DO NOW to protect yourself from this kind
1. REVIEW YOUR COMPENSATION POLICIES
to make sure you are paying your key people fairly. Think about it from their perspective employees who are underpaid relative to others in their field will tend to make finding a better job their number one priority. But you want your salespersons' top priority to be bringing in sales for your company. Some companies seem to believe that they can save money by underpaying their employees, but this shortsighted approach rarely pays off. In addition to the obvious loss of profits when a salesman takes customers with him/her, the hidden costs of employee turnover can eat into your profits in ways that are harder to measure because they don't explicitly show up on your financial statement. These could include the cost of temporary help or overtime to get the work done while the position is vacant, the cost of
advertising for the position, and interviewing the applicants, recruiter or agency fees, and training the new employee. All of these tasks subtract dollars from your bottom line and distract your people from their main mission. Note that paying fairly does not mean overpaying. If you've been giving automatic raises for several years, you may find that your compensation levels are now above market, and that's not ideal either.
2. REVIEW YOUR HIRING PROCEDURES.
Once you realize you have hired a person who's unqualified, overqualified, or just a bad fit in the company, there's often no alternative but replacement. The only way to avoid this is by HIRING SMARTER in the first place. Many small businesses and some large ones select new employees based on someone's 'gut feeling' after reading a stack of resumes and informally chatting with a few candidates. This casual procedure virtually insures that the best candidate will not be selected.
3. REVIEW YOUR EMPLOYMENT CONTRACTS.
You say your company doesn't use employment contracts? Whether or not they're in writing, you DO have contracts with your employees. If the terms of the contract are not spelled out in writing, then a court may end up deciding what they are -- and you may not like the results. Only your attorney is qualified to advise you on the terms of your employment contracts, and whether they should be in writing. But in your review, consider formalizing the employee's responsibility for Company property. If the employee leaves the company, what are his/her obligations regarding company property in his possession? Generally, you should insure that the employee returns all company property including all documents containing valuable company information.
4. PROTECT YOUR VALUABLE CONFIDENTIAL INFORMATION.
How can you tell if a particular document or piece of information should be considered confidential?
Ask whether the information . . .
Your company's financial statements, lists of customers, leads, bidding jobs, and business procedures are just a few of the kinds of information that are important to your company and should be treated as the valuable assets they are. They shouldn't be carelessly left lying around, any more than you would leave
valuable power tools or the company checkbook unattended. Yet that's what many
Consider implementing a written policy which:
Prescribes procedures for labelling, storing and disposing of the documents (which should be marked "confidential", stored under lock and key, and shredded before disposal?)
5. KNOW WHAT YOUR SALESPEOPLE ARE WORKING ON AT ALL TIMES.
In some companies there is an atmosphere of secrecy operating in the sales force. Individual sales people jealously guard the identity of their leads until the job is in the bag for fear that someone will try to steal it or take the credit. This is not a healthy attitude, and you should take care that it doesn't infect your company. It's true that much of the information about bids your company is putting together should be treated as Company Confidential - but that doesn't mean it should be a secret from YOU! This information belongs to the company, and should be documented as such. You must know - or be able to look up - information on every lead and bid your company is pursuing. Only then will you be able to step in instantly if a sales person leaves, and continue the sales process with the existing clients. Not only should the owner and senior management have access to this information, but for most companies we recommend that the sales people themselves have access to basic information about what their peers are working on.
This brings several benefits to both the sales force and the company:
HELP IS AVAILABLE
Did you know that there is software available to help track some of your most valuable information, and provide you, the business owner, with a "Big Picture" view of your company at the same time?
It's not your accounting software, nor your estimating, project management, or document management programs. These programs are useful, to be sure, but they're not designed to give you the big picture.
Contractor's Command Post is the business intelligence program developed for contractors by contractors. It organizes and streamlines the communication and storage of key information about your company's jobs, customers, and markets. With Command Post on your desktop, you'll know more about what's happening in your company than you've ever known before, and save money at the same time. Best of all, Command Post's big picture views will give you the power to make more profitable business decisions.
Command Post specifically helps your sales force organize information on all leads being pursued. The information is accessible to YOU instantly and easily. And tracking lead information is just the beginning; Command Post tracks job status from lead to bids-due, bid pending, active, delivered, in warranty, and keeps the information forever - so you can always look it up, instantly.
Command Post is surprisingly affordable - costing less than ordinary contact management software and easier to use. And it can provide some of the key benefits of an enterprise system at just a tiny fraction of the cost with virtually no risk.
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