Diseases of the Workplace

What Kills a Business Culture?

Out of the top things that stress out people the most, work and finances are in the top three. The other is anxiety about the future, but I think most of that anxiety, if really investigated, could be traced back to unhappiness with work or finances. As a business owner and former employee of various industries, I have seen firsthand how stressful the workplace can be. In my experience, very few people are actually satisfied with their workplace and much of their dissatisfaction comes from the culture of the business itself. A business is really only made up of two things—people and a culture. Both affect each other. People create the culture, but the culture can change if people’s attitudes change or new people are brought into the culture. With that in mind, here are the biggest diseases that will destroy a business culture and lead to a decline in sales and happiness amongst staff.

Habituation—Do you remember what it was like to drive a car for the first time? Were you nervous? Did you check your mirrors multiple times and turn down the stereo so you could focus? When you first undertake something, a good amount of attention and action is required to perform the task. However, after we get used to doing an activity over and over, less effort is required. This is called habituation. Now, you may drive with one hand on the wheel, another on a cup of coffee while the stereo is blasting. What used to be hard and required intense focus is now somewhat easy and less focus is given. The problem is that over time, habituation can lead to a degradation of the quality of the business systems and culture.

Consider this—a new hire is likely to perform to his or her best ability and take an active interest in learning the job. After a while, however, as the employee becomes used to the job the attention to detail and willingness to learn and grow often decline. Whereas a new hire may go the extra mile to impress others, the employee who has been on the job a while will likely not be looking for an opportunity to go the extra mile. The new hire will pick up the dust ball in the corner because they see it does not belong. After time, the old employee will not even notice the dust ball. They have become habituated to the job.

“Not my job” disease—This may be the worst and most common of them all. I would venture to say every workplace I’ve ever been a part of has a fair share of employees who do not even try to help our their coworkers or employers because they consider a certain task to not be in their job description. Not only are these people not willing to go the extra mile to help out, they won’t even go the first mile. The person who only does the bare minimum to keep their job destroys the culture because the attitude is infectious. Soon, others will say the same thing. What these people do not realize is that a business is like a ship—if things are going well, the ship can hold extra personnel and cargo for a time. But, if things begin to turn downward, only the people who are absolutely necessary to the survival of the ship will be a part of the crew. Those who consistently refuse to go the extra mile to help out the crew will be among the first to be let go.

Staff doesn’t know the mission—Why does the business exist and what is the mission of the business? These two questions must be answered very clearly by the ownership and every single associate of the business must understand the answers so clearly that they can repeat the answers with confidence. If the staff does not understand why the business exists or what the mission is, they cannot be in alignment with it and that will lead to dysfunction in the systems and operations of the enterprise. You would be surprised how many employees do not know what their place of employment actually does or why it is important. Every single staff member must understand and believe in the mission of the company to create unity, harmony and a positive working culture. Without alignment on the mission, the business is doomed and the workplace culture will reflect that.

Lack of communication from all levels—Communication is key to any enterprise, relationship or any other undertaking. It’s vitally important that every person in an organization is able to properly communicate with other coworkers, management and ownership. So many organizations have staff that don’t speak to each other or even resent other individuals in the business. If there is a lack of communication in the workplace, basic functions of the organization will not be able to be carried out properly. Moreover, mistakes will not be caught or voiced to ensure that systems are put in place to keep the problems from occurring again.

Perhaps the most important reason for great communication is that people thrive when they feel they are a part of something special. They need to be reminded what the mission is, what needs to be done, how it should be done, who needs to do it and why it is important that tasks are accomplished. Much like a relationship, all parties need to feel like there is an open line of communication so that growth can occur, both for the individuals and the company as a while. Without it, employees will begin to resent the business and other staff and the business will suffer.

No focus on harmony—I’ve written previously about the importance of harmony in a relationship and a workplace. I’m a strong believer that harmony among all associates in a business is necessary for a happy workplace. If discord or animosity exists even among a few employees, it will quickly sweep through the entire organization like a virus. Soon, the happiest, most productive people will find themselves subject to the unhappy that comes with a lack of harmony. It should be that we all strive to work together with each other to achieve a common goal or mission. To do this, harmony is required. Watch out for people with negative mental attitudes. They will destroy a culture and kill a business. My advice would be to look closely at your own actions and beliefs to make sure that you are not the one guilty of a negative mental attitude. Hint: if you believe that everyone else at the job sucks except you, you’re probably the one guilty of spreading negativity and ruining the harmony in the workplace.

Not enough focus on growth—Nature requires growth from every living thing. If you are not growing, you are vulnerable. If a relationship is not growing, it’s declining. The same is true with business. If a business is not growing, it may as well be dying. Inflation and competition will eat away as a stagnant business until there is nothing left. Growth is required to thrive, and every associate in a business must understand this concept. Considerable attention must be given to acquiring new customers, not just keeping the ones you have. All growth comes from new customer acquisition and the future referrals from them. Growth focus looks like this: New Customer Acquisition—> Deliver Incredible Service—> Referrals. The cycle then repeats. If every associate is not focusing on this cycle there will be stagnation in the business and that will lead to dissatisfaction and disappointment in the workplace. People need to feel like the future is going to be better than the past. Progress equals happiness. Growth equals excitement and energy. Stagnation leads to boredom and a lack of care. The culture of a company must have a focus on growth in order to succeed.

“I’m the only good worker” disease—This belief is so common and so deadly in a workplace culture. In life, it’s easy to believe that we are all the stars of our own movie and every else in our life is just a supporting role. Although it may certainly feel like you are the “good guy” and everyone else isn’t the real star, this type of thinking can quickly lead to the belief that no one else cares, or that you are the only one who does a good job. If you think poorly of your co-workers, not only does this suggest a lack of harmony is present in your workplace, it also suggests that you have a negative attitude towards others. If you are truly the best worker in your business, your efforts should be to help everyone else where you are able, not speak poorly of them or their work ethic.   If you are a leader or an influencer in an organization, this is especially important. People should look to you for leadership and guidance on how to improve and be better. This will not happen, however, if you bash others as being inadequate or poor performers. Instead, they will come to resent you and that will lead to more discord in the workplace.

There you have it. There are, of course, other attitudes and behaviors that will destroy a workplace culture, but these are the most important to recognize and correct. At the end of the day, a workplace culture can be as great or as poor as the people who comprise it want it to be. If you want to be a part of an incredible workplace, make sure it does not suffer from the above listed problems. Moreover, make sure that you are not guilty of the attitudes listed.

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On Virtue

I’m going to talk about virtue in this essay… stick with me.

When’s the last time you heard the word virtue? Maybe you remember the term from philosophy class in high school or college? What do you think of when you hear the word? I bring up virtue, or moral excellence (high moral standards), because it’s something I think about often. It’s such an important ingredient to living a fulfilling life. Virtue is also needed when building a great family or relationship. I think virtue is even more important in building a lasting business that serves the marketplace. Something I ponder, the same question the ancient Greeks raised: “Can you live a successful life without being a virtuous person?” Our society’s current standard for what success is has virtue so far removed from it. I think we must move in a direction as a people that declares the only successful life is one lived with virtue. Ironically, if there is one value lacking in society today, it would be virtue.

I believe that businesses especially must return to the philosophy that virtue—incredibly high moral standards are the cornerstone of a successful, lasting business. Sure, anyone can make money off of other people by scamming them or selling them inferior products or services, but that kind of business will never last in a marketplace that values integrity and quality. The truth is that we all demand integrity and quality from others, and that is where most people truly fail. You must demand integrity from yourself. If you value morality in people, in the marketplace and in society, you must first demand it from yourself. You can never ask someone to have certain ideals that you yourself do not exhibit.

Likewise, as a business owner, I can never ask my employees to have virtue unless I first demand it from myself, and I do. I make it a discipline to reflect every night on whether I exhibited virtue throughout the day. Was I someone that other people could learn from and look up to? Did I lead my staff in a way that I would want them to lead others? Did I act in accordance with who I really am and who I want to be? Or, did I allow myself to slip? Being mindful of my successes and my shortcomings regarding virtue is something that allows me to grow as a person of character.

There can be no success without virtue. No relationship or business will last, business or otherwise if both parties do not have a high regard for integrity and moral standards. Every good person interested in the well being of themselves and others seeks to live in a world of harmony and goodness. So, a good place to start is by asking every day: “Who am I?” “What type of person was I today?” “Did I act in a way that others would see as virtuous?” “Am I proud of my actions as a leader, an employee, as a lover or a parent?” These questions, if reflected upon daily, can guide you to leading to a life of incredible integrity and fulfillment—a life of virtue.

Sean

Life and Death

These are troubling times. Not that there haven’t always been troubling times, it’s just that more of humanity is aware of problems in various parts of the world thanks to technology. Unfortunately, there will be more troublesome events to come. It is unlikely bad things will stop happening. However, it’s important to remember that you choose where you get to live emotionally. You can live in despair and fear. You can live in gratitude and abundance. The choice is yours. Do you want change in the world? Change yourself first. Specifically, there are two things that must change for positive transformations. The first is having a productive philosophy towards life. The second is to live in harmony. If you have these two characteristics, you will thrive. These are the traits needed to maintain life. If you lack these, you will begin to break down and devolve. Life needs harmony and clear thinking. Death does not. Death must be staved off–the death of the business, the relationship, the organism. It is the natural consequence of not having a philosophy of productivity and being in harmony with those around you. Growth or death—it is all very simple.

Those who develop and maintain a positive, productive philosophy will always do well because they take responsibility for everything in their life and control their emotions and responses to the world. These people will also have a natural tendency towards harmony with others. Those who have a productive and positive philosophy understand that harmony is essential for life. Your body must work in perfect harmony to sustain energy and life. If not, it begins to decay and the damage may be irreversible. The same is true with a business culture. A relationship is perhaps the clearest example of why philosophy and harmony are necessary to life. Both people in a relationship must give 100% effort for it to work. They must each have a philosophy of love, responsibility, and compassion. Each must strive to be in harmony with the other. Yet, half of all marriages end in divorce. It’s so simple to see why. It’s the lack of harmony and maintaining a philosophy of positivity. The same goes for the violence so prevalent amongst mankind. All of it can be traced back to the lack of the fundamental characteristics needed to grow and maintain life.

I urge all of my employees to strive for harmony with each other. Most workplaces are toxic and a majority of polls taken of employees show that most have significant issues with their coworkers and managers. This is all due to a lack of harmony. There must exist a desire to be in harmony with all those in your workplace (and in your life) to realize an incredible workplace. Without that desire for harmony, the natural tendency towards problem and decay will occur. If this continues in a business, it becomes part of the workplace culture. Once it’s a part of the culture, it’s nearly impossible to stop without replacing every individual. Often, even the great employees cannot free themselves of the damage done to them by a toxic environment. It warps their philosophy to see the worst in others and seek out problems. If people only knew it was within their own power to change this. An incredible workplace, an incredible relationship—an incredible world begins with each person acting incredible and developing an incredible philosophy. Be mindful of your own personal philosophy. Is it geared towards harmony and growth? Or are you letting your mind erode with the problems of life? Are you thinking clearly—thoughts leading to positive consequences for those around you and your loved ones? If not, change it. Be the change you want to see in the world.

An Open Letter to Democrats & the Supporters of the $15 Minimum Wage

By Sean Covell

CEO Fitness System

Bachelor Degree UC San Diego

As an employer and resident in California, I have had to hold my nose for the past decade as it becomes increasingly difficult to do business in the Golden State. While California has many things going for it–beaches, Hollywood, Silicon Valley–it does not have a friendly business climate. This state ranks 32nd on Forbes’ Best States For Business in 2015. The $15 dollar an hour minimum wage law, recently passed by the California Legislature (a gang of people dedicated to fundamentally altering the role government has with its citizens and non-citizens lives) and Governor Jerry Brown, will cause California to be ranked dead last.

My goal is to have as many politicians read this as possible and knowing that most politicians have an aversion to reading (especially their own legislation), I’m going to keep this brief. What follows are eight reasons why the new minimum wage law is damaging to the freedoms and pocketbooks of all citizens.

             The minimum wage artificially increases the price of labor. That’s right, labor has a price and the higher that price becomes, the result will be less overall labor participation. This is basic supply and demand. Most economics professors would agree. The tragedy is that workforce participation is already at a 32-year-low! What will it become after the $15 minimum wage? It will be even lower. Some economists may dispute this, but the honest ones will admit that, all things being equal, there would be more labor participation without a minimum wage. This cannot be refuted. It’s a simple truth. If the price of labor is lower, more people can be hired. The other real irony is that government loves to artificially increase the price of things it doesn’t like through fees, fines and taxes as to reduce their use– cigarettes, alcohol, big screen TVs and heavy vehicles are all subject. I guess the government doesn’t much like laborers either.

            The cost of living will necessarily be higher. A big argument from proponents of this law is that while the cost of food, tuition, rents and other consumable goods has increased, wages have not. Leaving aside all the other reasons why this could be–tax policy, subsidies for tuition and rents, people dropping out of the workforce and electing to receive welfare, inflated stock and real estate prices, inflation of the money supply– this is a classic example of the seen versus the unseen. What is seen is that prices have gone up. What is unseen is that government policy has contributed to this. What is also unseen is that forcing employers to pay more for labor will result in them having to raise prices to cover the costs. This will adversely affect the consumer. Ironically, it will mostly affect the very people this law aims to help, the minimum wage employee. They will not be able to absorb the inflated prices as well as other income groups. So while they may get a pay bump, they will not come out ahead.

            The minimum wage unfairly targets low-skilled and entry-level employees. The minimum wage on its face is really an unemployment law. It states that an employer like myself cannot hire anyone under the price the government sets. Therefore, anyone who could have been hired for $14 dollars an hour or less cannot be legally hired. Thus, unless they are deemed to be at least producing more than $15 an hour in revenue, they cannot be hired. The reality is that not all entry-level jobs produce the same amount of revenue. As a result, those who would have been hired for, say $12 or $10 or even less will have no job. Unemployment will rise among the groups that currently make minimum wage.

            It violates private and mutually beneficial contracts. If I want to wash windows for $5 an hour and an employer agrees to pay that $5 an hour in return for services rendered, why does the government get to tell me that’s not legal? In this instance, the government is violating basic agreements that allow the free market to function. The state is now a hindrance to free market exchanges and productivity. So what am I to do? If I cannot produce at least $15 an hour in value I must go to the state to receive welfare. This places the burden on the taxpayers across all income groups.

            The minimum wage unfairly targets smaller businesses. While politicians love to express their love for small business the truth is they much prefer large businesses to contribute to their campaigns. And while people think some chain restaurants and other businesses are large, in reality many are franchisees (small businesses that pay a fee for the Taco Bell or McDonalds name). These businesses, like my own, offer flexible hours and the opportunity to gain skills in the marketplace for entry-level workers and people who would simply like another part-time job. The net revenues of these business is not such that they can afford large salaries, high hourly wages or other perks afforded to state employees and employees of larger businesses. The employees and employers who will suffer are the local mom-and-pop-shop and the kid next door. They will be the ones to be out of business or out of a job.

            Price controls do not work. Look throughout history to regimes that have tried to impose price controls. They have always failed with many unintended consequences. Only entrepreneurs in the marketplace, with market indicators, can properly price goods and services. They are also the only ones who can truly determine how much someone should be paid in the enterprise that they built. Every time price controls show up, a black market pops up. This is the real economy.

            The cost to employers will be higher across the board. Few remember that what an employee is paid in their paycheck and what the employer must pay to employ that person are very different. The employer cost is much higher. In fact, the burden for almost everything from taxes to child support falls to the employer. When the minimum wage goes up, the employer cost for taxes, unemployment insurance and disability will increase as well. Moreover, workers compensation insurance is billed by the total dollar amount of wages worked by all employees in a tax year. This is yet another cost increase for the employer. Furthermore, and perhaps the biggest problem with this law, is that employees who now make $15 per hour or above will demand more money because they have a more refined skill set. How is it fair for an unskilled worker to make $15 when someone who has worked at a business for years makes the same? It’s not. And employers will be forced to increase wages across the board. Some businesses, because of market forces, cannot just go raise prices to cover the increased costs. The result? Less employers. Less employers=less employees=more people on government assistance. Simple.

            There is no requirement for increased productivity. Money is not wealth and it’s not what makes the economy run. If money was wealth, the government could just print us all money and we would be very wealthy. The problem here is obvious. More money in circulation will not result in more production. Increased wealth comes from an increase of productivity (output) and value in the marketplace. From an early age we are told to go to school and graduate so that we can learn more skills and produce more in the marketplace. Want a raise? Become more valuable to the marketplace! Refine your skills. Learn something new and apply it. The government and supporters of the $15 minimum wage do not believe this. They think workers deserve to make more by fiat. So they petition to government to make it so. Does the employer receive more value for the additional wages paid? No. Does the customer receive any more for the higher prices paid? No.

And there you have it. Eight examples of the “tyranny of good intentions.” This is what government does best. It only focuses on what it sees instead of the consequences of action. Let me be very clear: I believe that everyone should be paid more in every country across the world. I believe this can only come through adding value to the marketplace and increasing productivity. I do not know for sure how this will all play out long term. I do know that as an employer and entrepreneur, other states are looking much more “golden” than California.