Business Up Front - September 2000

Business Up Front

As technology, information and workloads have surged, so too has the need for consultants, according to Elaine Biech, author of The Business of Consulting: The Basics and Beyond. Biech claims two primary trends have caused a dramatic rise in the number of consulting projects: the trend toward outsourcing services, and the rapid rate of change, which makes it difficult for an executive team to keep abreast of current developments. But are consultants worth what they charge? Biech offers five reasons why she believes they are:

Consultants have the experience, expertise, and time that employees may not. Organizations often have difficulty hiring enough good people just to keep up with normal, ongoing tasks. For special projects requiring new skills and more time, it makes sense to hire a consultant, who brings experience and expertise from past projects and other organizations.

Consultants provide flexibility. Consultants can be brought in for short-term projects. They are there when you need them, and gone when you don’t. They work any time of the day or night, and do not require ongoing paychecks, benefits and severance packages.
Consultants offer a fresh, objective point of view. Staff may be too close to the problem to see the solution, while consultants are able to provide unbiased, new, fresh ideas. In addition, they are not influenced by internal politics that may prevent employees from revealing their true thoughts and opinions.
Consultants are more efficient for three reasons: They have experience with similar projects and do not need to be trained; they have the luxury of focusing solely on their assigned problem; and they do not need to deal with the organization’s daily tasks such as staff meetings, opening mail, and retirement parties.
Consultants may be proof of honest endeavor. When other parties are involved, for example during a merger, hiring an external consultant may serve as a sign that an honest effort is being made to correct a problem. An outside party can also serve as an impartial mediator to resolve differences.

Flying the Unfriendly Skies

Air travel has doubled since 1980. With this growth has come an increase in flight delays and cancellations, and a decrease in satisfaction with air carrier service. According to a report issued by the U.S. Department of Transportation (DOT), flight delays have increased by over 50 percent in the last five years, with much of the delay time occurring on the ground in the form of longer taxi-in and taxi-out times. Cancellations increased 68 percent between 1995 and 1999.

The 1999 DOT Air Travel Consumer Report disclosed that consumer complaints against U.S. air carriers more than doubled in 1999 over the prior year. Flight problems (delays, cancellations and missed connections) ranked number one on the list of complaints from air travelers. Customer care, rated second, included reports of poor employee attitude, refusal to provide assistance, unsatisfactory seating, and poor food service. Baggage problems held third place, with grievances about reservations, ticketing and refunds rounding out the list.

Over 17,000 complaints were logged in by the DOT. However, the actual state of consumer satisfaction is significantly worse than these numbers indicate, since the DOT estimates that air carriers receive 100 to 400 complaints for every one filed with the DOT office.

Phoning, Faxing, Shaving and…Driving

Federal authorities report that the proliferation of mobile gadgets such as cell phones, mapping systems and portable computers has made it less likely that drivers are giving their full attention to the road. The U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) recently convened a public meeting and an international Internet forum to address the issue of distracted drivers. A new NHTSA study produced the following disturbing statistics:

Percent of drivers who have phones in their vehicles or carry phones when they drive: 44
Percent with email access in their vehicles: 7
Percent of drivers with facsimile capabilities: 3
Percent of the 6.3 million car crashes each year which involve some form of distraction or inattention: 25

A 1997 study in the New England Journal of Medicine found talking on a phone while driving quadrupled the risk of an accident and was almost as dangerous as being drunk behind the wheel. A new bumper sticker seen recently says it all: "Hang Up and Drive."

Small Business Online Spending Soars

According to a new survey, American small businesses are fueling the Internet economy by purchasing a substantial portion of their products and services online. Spending on Net-based transactions and purchases by U.S. small businesses grew more than 1,100 percent in just one year, rising from $2 billion in 1998 to $25 billion in 1999. The findings were part of a study by New York-based Access Markets International Partners, Inc., which projects that small business online purchases will reach $118 billion by 2001.

The study shows that 4.2 million of the 7.4 million U.S. small businesses access the Internet, and 1.3 million small businesses are using the Internet to collaborate or pool with other small firms to buy in groups and get better prices. More than half of the businesses responding to the survey noted that they would find a constant, high-speed connection to the Internet useful. Also, 40 percent were interested in receiving and providing customer service and support via the Internet.

Small Business Facts and Figures

In fiscal year 1999 the Small Business Administration:

Maintained a guaranteed loan portfolio of more than $40.5 billion in loans to 486,000 small businesses.
Backed over 49,000 loans totaling a record $12.5 billion.
Made a record 3,100 investments worth $4.2 billion through its venture capital program.
Extended management and technical assistance to more than 900,000 small business persons through its Service Corps of Retired Executives (SCORE) volunteers and 1,000 small business development center locations.

SBA statistics reveal that America’s small businesses:

Employ more than 52 percent of the private workforce.
Generate more than 51 percent of the nation’s gross domestic product.
Are the principal source of new jobs.

Telecommuting Seen As Hottest Workplace Trend

Telecommuting was identified by 43 percent of human resources executives as the biggest workplace trend of the 21^st century, according to a survey by the outplacement firm Challenger, Gray & Christmas. Telecommuting has become a highly sought-after work arrangement for employees desiring a more flexible schedule which allows them to balance the demands of work and personal lives. "Telecommuters tend to be clockless, meaning less likely to restrict their work to the hours between 9 and 5, said John Challenger. "While he or she might take a couple of hours in the middle of the day to run errands or spend time with a child, the telecommuter often works into the night, likely putting in more hours than employees at the office." The survey found telecommuters to be highly efficient-one Colorado software firm found its "teleworkers" were 20 to 25 percent more productive than employees who worked solely in the office.