Business Up Front - August 2004

Business Up Front

Stand By Your Man?

Mike Mitchell of Fisher & Phillips, a law firm representing employers in labor issues, presents the following example of union job security taken a little too far. The city of Moncton, in Canada, fired a man who had been working as a tree cutter. He later turned up drunk at City Hall, carrying a shotgun and a handgun, looking for two senior managers who were fortunately out of the building. After a brief standoff, he was disarmed by a co-worker and arrested by the Canadian Mounties. One week later, Local 51 of the Canadian Union of Public Employees filed a grievance calling his termination unjust – although his blood alcohol level was three times the legal limit for driving a vehicle, and although many of the two dozen union workers forced to flee the building during the ordeal had to undergo treatment for stress. City spokesman Steve MacKinnon said, "In some cases there is a pretty high threshold for dismissal, but coming in drunk with a gun and saying, ‘Where’s the boss?’ – I would submit we are way beyond that." The gunman, now serving two years in the penitentiary, is looking forward to being released, according to Mitchell, since the union is doing its best to help him get his old job back.

Nevada Ranked Number 2 Wealth-Friendly State

Nevada ranked second to Wyoming in the list of America’s most "wealth-friendly" states, according to an annual ranking released this spring by Bloomberg Wealth Manager magazine. The publication serves financial planners and investment advisers who counsel the affluent. In its seventh year atop the wealth-friendly chart, Wyoming reigns supreme when it comes to keeping the wealth in the hands of the breadwinners, not
state government. Rhode Island, on the other hand, might be a nice place to visit, but you may not want to live there if you’re rich. It was ranked America’s most "wealth-hostile" state for the fourth straight year. For the annual wealth-friendliness survey, co-author Thomas Saler compared the impact of state taxes on salary, real estate, personal property and retirement assets for four hypothetical families. The editors ran exhaustive research on tax codes and effects in each state. The results vividly demonstrate how tax bite can vary from state to state. For example, the identical set of financial parameters that generated a tax bill of $7,259 last year in Wyoming could have cost a family $56,419 in Rhode Island.

Ultimate Real Estate Listing? – The White House

Think your mortgage payment is too high? Not compared to the $667,000 monthly mortgage payment for what would undoubtedly be the most expensive home in America, if it were for sale – The White House. Top real estate agents nationwide were asked to estimate what the White House’s listing price would be if it were for sale in today’s hot real estate market. After scouring price-per-foot data, reviewing the home’s features and historical significance, the agents’ collective answer is that the world’s most famous residence would command an asking price of $106 million, according to a national survey by HouseValues, Inc. "We’ve provided home evaluations for just about every size, color and style of property imaginable," said Ian Morris, HouseValues president and CEO. "However, we don’t see a lot of homes with their own dentist’s office, movie theater, running track and bowling lane." Agents who accepted the challenge of evaluating the listing faced a couple of formidable obstacles. First, the White House is truly unique, so there were no comparables or "comps." Second, there was the problem of trying to put a price on the White House’s stature as a national treasure and perhaps the world’s most enduring symbol of democracy. Susan Zagorsky, a RE/MAX agent from San Diego, said there were a number of things she considered before coming up with her estimate, including: Anyone can visit free of charge, so privacy is somewhat restricted. The West Wing was added after the initial construction. And, contrary to popular belief, George Washington never lived (or slept) there.

Biggest Management Missteps

Nobody’s perfect, including the boss. Executives polled recently acknowledged making a number of mistakes, from not recognizing staff accomplishments to overworking their teams. The survey was developed by Accountemps, a specialized staffing service for temporary accounting, finance and bookkeeping professionals. It includes responses from 150 executives with the nation’s 1,000 largest companies.

Executives were asked, "What is the biggest mistake you have ever made as a boss?" 

Withholding praise was a problem cited by many: "I didn’t give recognition to someone who turned out to be one of my best employees and soon lost her."

Letting poor performance go unchecked was another frequently cited misstep: "I kept someone on who should have been let go."

Hiring the right staff is a key management challenge: "I encouraged a group manager to hire an internal candidate when an external candidate was better qualified."

Once you have good employees, you don’t want to lose them: "I didn’t pick up on signals from disgruntled employees and the first sign of trouble I had was a resignation letter."

Even if their actions didn’t result in turnover, managers regretted not being more supportive to staff: "I wish I had provided more opportunities for subordinates to engage in projects they enjoyed." And: "I was overly harsh in my criticism, and that brought about insecurities in my employees."

False assumptions often led to trouble: "I assumed I knew what my employees’ problems were instead of talking to them. Now I talk to my employees instead of assuming that I know what’s going on."

Although management mistakes can be a learning experience, some lessons come at a hefty price: "I delegated some work on a project and never checked to see if it was completed. A year later, I discovered it had never been done, and it cost the company about a million dollars."