I lost track of how many times I’ve heard that phrase or variations like it to justify business decisions whether it be employer vs. employee or business vs. customer.

If your focus is building and maintaining relationships, the “vs” should always be a red flag. If your focus is on the dollar, then you might miss the “vs.” part of the equation.

How many of you have heard the phrase, penny wise and dollar foolish?

May I propose to you that if you believe “This is business, not personal” when it comes to any relationship, you are losing more dollars than if you treat every issue as being very personal?

How much longer do relationships survive if you treat each one with loving care? That each decision and action are personal to the recipient; and, their feelings always matter.

What’s the life time value of your customers? Do you want that life blood to be extended for as long as possible? Then consider making it very personal in the right ways.

What are your thoughts? Please share them in the comment area below.

Let me share with you some tools you can use to save you time; and, still allow you to participate in the social media arena.

BufferApp has a free version, and an upgraded (paid) version.

BufferApp allows you to pre-schedule your posts to Twitter, Facebook, and LinkedIn.

Personally, I use the free version of BufferApp to schedule ten (10) twitter posts; and as the day goes by, I re-fill those ten so that come 8 PM at night there’s 10 posts ready for the next day.

TweetDeck, currently my favorite tool for Twitter gives you the ability to schedule posts far out (much more than the Buffer free version) along with keep track of various searches, your twitter inbox and more.

Another alternative, one that has a lot of flexibility but runs slower than a snail (even on a brand new computer, 16 GB RAM, Intel I7-2700 3.50 GHz CPU) is Hootsuite that beats out both of the above in that you can really get into managing and scheduling with a large number of social networks.

Oh, before I forget, if you get involved in twitter chats, I highly recommend TweetChat.

Now for time saving steps:

• Schedule out your tweets using BufferApp or TweetDeck or HootSuite.
• For Facebook, consider using scheduled posts vs. an application.
• For LinkedIn, while you could use BufferApp or HootSuite, I find it better to really go niche for what you post which means you will be posting more quality, less often. That means you often don’t need a tool to do it for you.

In the end, just like in the road sign picture — stay focused on building your business, and living your life.

Small Business Resource: Customer Loyalty 3.0: How to Avoid Getting Customer Loyalty and Social Media Backwards

Do you have tools or techniques you use to save time on social networking? Share them in the comments below.

The next time I get a phone call to go over hacker clean up, server hardening, server administration where the prospective customer is more concerned over the $100.00 per hour rate than the problem costing them customers and potentially their business, I hope remember to share with them this article.

Imagine reading Service Suspension – Ongoing unanswered abuse complaints thinking to yourself, the person is in a jamb…. I hope they get someone who can really help them (maybe we could, not sure), then later on reading the person who initiated the post also runs a “All you can Eat” (i.e. unlimited support tickets, unlimited labor time) server administration business where they advertise a long list of what they can do for you for just $15.00 per month. I guess, they are so packed with work they could not solve their own problems.

Imagine, for just $15.00 per month you “24/7/365 USA-Based Technical Support” plus “24/7/365 Server Monitoring (5 Minute Intervals)” of your servers plus “Guaranteed 15 Minute Response On Monitoring Alerts” and so much more… sounds like a great deal? Right?

Now, I’m sure if you did a study of people who have heard and even believe in the quote, “you get what you pay for,” or variations of it, the percentage would be high.

Yet, how many actually do their homework to determine if something is really to good to be true?

For example, would you know right away that $15.00 per month for 24×7 coverage 365 days per year with a guaranteed response time of 15-minutes and unlimited administrator work (i.e. unlimited hours of work per month) was a deal too good to be true?

What if they removed the word, “unlimited,” and only included one hour per month? Would it then be more realistic?

In order to answer that question, what’s the going hourly rate for a server administrator? For a security administrator?

In the United States, for a server administrator, the going hourly rate ranges from $30.00 per hour to $52.00 per hour; for security administrators, the hourly rate ranges from $38.00 per hour to $56.00 per hour. In both cases, that doesn’t include benefits.

If a company is saying you get just even one hour for $15.00 when the going rate for an experienced party is $30.00 to $38.00 at a minimum….. get the picture?

You might get marketing speak that the employees multi-task and can work on many tasks at the same time… but isn’t that like someone who worked 2,000 real hours putting down 6,000 billable hours?

What are your thoughts on this subject? Did you purchase time thinking the rate was good or even average only to find out you were taken in by a “too good to be true” event? Let us know your thoughts below.

One of the reasons businesses fail is due to having a rate which doesn’t allow the business to be self sufficient in paying the bills including taxes.

Allow me to share with you lessons I’ve learned over the past 17 years with how to determine your hourly rate.

Let’s start off with a homework assignment.

• What is your target annual salary including benefits (this must be a dollar figure, not a list of what benefits)?
• If your business were to take off, what job functions would you need to hire employees to cover?

• Would those job functions be directly involved in producing revenue (eg production worker or sales / marketing that generates work for production worker(s) or overhead (eg book keeping)?
• What is the going annual pay rate for those positions (even if just an hourly job, take estimated hours they will work in a year times the hourly rate; do include benefits in the overall annual figure)? Your local Chamber of Commerce and library may have this information for you (just ask).
• What are the hourly rates charged by those with whom you would be competing? What’s the lowest? What’s the highest? What’s the median? What’s the average? You can often find out this information in various LinkedIn groups as well as associated business forums.
• For the type of business you will be doing, what are the annual fees of any licenses, insurance, etc. as well as other direct costs of doing business?
• How does the quality of your work compare to those with whom you would be competing?

Now, let’s deal with the simple part — what if you are gong to be a Soloprenuer (this is extremely legitimate) or otherwise a one person business?

In that case take the very first number — What is your target annual salary including benefits — and divide it by 1,000. That will be your base hourly rate.

Where does the 1,000 come from? Are there not 2,080 hours in a business year? Well, yes; but, if you take vacation and allow yourself sick and personal days, you are down to 2,000 hours.

Out of the 2,000 remaining hours comes marketing, networking, connecting, writing proposals, follow ups, cold calling, follow ups, administrative tasks, and finally billable work for which your goal should be at least 1,000 hours.

Chances are high that in your first one to several years, you might spend 500 hours on billable work; and you may want to consider that as part of determining your rate.

If your target salary plus benefits is $75,000.00 (keep in mind health care is very expensive), then you are looking at billing out at $75.00 per hour ($75,000 / 1,000) as a ball park rate.

From here, compare to your competition; but do not short yourself if they are charging the same or less. Look at the values you bring to the table.

By the way, if your competitors normally does packages and and all you can get from your competition is package pricing, realize that time almost always goes into creating, developing, and implementing the package. Try to find how long they take, and then you can determine the hourly rate. Also, how long would you take to create, develop, implement the same thing? Where would you be better? faster? more accurate? a better investment? why?

As you are doing your homework in these areas, what are your direct and indirect costs? The direct ones should be factored into your rate. The indirect ones should also be incorporated into your rate if the indirect fee is not something you would pay anyway if you were not in business for yourself (i.e. you typically don’t include your meals as part of the cost of running your business).

So, how do you adjust that ball park hourly rate for your other costs? You convert them to yearly, then divide the the same $1,000.00. Then add this to your ball park.

Let’s chart this out:

The idea, for you, is to do your best to chart out what it will take; and then convert them into what should be your rate based on billing out at least 1,000 hours per year. FYI, this is a good area to get your accountant involved, check out small business books dealing with common business costs from the library, and check with your local chamber of commerce.

Once you start gathering numbers, the above gets to be extremely easy.

Where things can get complicated is when you get to the point where will move from Soloprenuer to where you have employees working for you. In that case, employees fall into one of three categories:

1. They generate sales for you and whomever else is doing the production work to ensure you have 1,000 or more billable hours. If it is just the two of you, billable hours should be 1,200 to 1,600 hours per year. While your divisor now goes up from 1,000 to as much as 1,600 (early on, I would use 1,200 to start until you get a handle on how much of a sales increase the person does bring in), you will need to incorporate their salary plus benefits plus costs.
2. They are production workers who do the billable work. While you might find production workers who can get their own 1,000 or more billable hours, generally the production worker just works on production. For a two person operation, that puts you in sales and marketing where you would need to make sure the production person has 1,200 to 1,600 hours per year of billable work.
3. Back end support – office management, accounting, clerical, but possibly I.T. or related if your business line requires such to help in what you do. This last group, while often vital based on where you are at with the growth of your business, is 100% overhead. This means their salaries plus benefits plus any other costs need to be added into the hourly rate.

The above is where I’ve seen a number of businesses fail over the years. The business starts off as a one person operation who realizes once the business starts to take off, they need one to several more people working the dream with them, but either cannot afford to pay them because their rates are so low, or do pay them the going rates, but run out of cash and end up in a lot of debt.

What’s your take on the math for handling a consulting type business (you get paid by the hour; you and your team are the product / service) for when there are two employees (one sales, one production or potentially one of each)? When there are three employees (one sales, two production)?

Let me know in the comments below.

Just after ceremony of our daughter’s graduation from culinary school, I was paged with the message the Internet connectivity was down to the facility.

I was able to verify the loss of Internet connectivity as we drove home; and then it became the dance between getting updates from the co-location facility in Lancaster, PA and providing updates to our customers.

This was the very first major outage the co-location facility has had in years; and, the very first outage that we experience since becoming their customer a little over two years ago.

The outage started shortly after 5:00 PM Eastern Time, and as it started to head past 11:00 PM, we had were faced with the following issues:

1. Off site backups would fail (as the backup server in Lancaster, PA could not reach out to the servers for which backup is scheduled).
2. Email to our customers that go through the anti-spam appliance would bounce.

Thank Jesus, we did have a Plan B for the mail appliance.

We would redirect the MX (mail exchange) record to point directly to our mail servers rather than the anti-spam appliance. While there would be an increase in spam delivered, at least mail delivery would have minimal impact.

While we did wait as long as possible to see if we had to implement plan b, we ended up doing so shortly before 3 AM Eastern Time.

Thankfully, connectivity with the local co-location facility was restored around noon time the next day; and we were able to shift gears back to the anti-spam appliance… and we only lost one day of not backing up.

While we had Plan B planned out, we got to experience the hick ups (oh, we forgot about customer abc that routes to a different mail server); and we updated our documentation if Plan B is ever needed again.

Please share yours in the comment section below.

My heart goes out to those families who have lost loved ones; and to the many who went through much hardship, especially compared to the little we ended up going through.

Just days prior to storm Sandy, our local power company contacted us to let us know that their may be multiple power surges and small outages; and, if there was a major outage, it could last three days.

Closer to the storm actually hitting our area, the power company shared that if there was a major outage, the power could be out for a week or longer.

Based on lessons we learned from a lightning storm earlier this year, we moved to an Internet-based telephone system.

The caveat of this move was that no electricity equals lack of Internet equals no business phone system.

Our plan A (which we did communicate with our customers the day before the storm landed) for if and when power went out was to use our netbook, laptop, and cell phones sparingly. We ball parked that if we checked voice mail and support tickets four times a day (given that each ticket may require time for a response, may require work on the server(s), etc.), accounting and sales once a day, we could last out three days without power. But a week or longer? We did not have a plan B.

My father-in-law shared there are devices that convert car electricity to that which can be used by a laptop or other small portable devices. We found this on Amazon.com, and my father-in-law loaned us a similar one. So that would cover the power to a degree.

Personally, we were able to get a hold of a Coleman Two-Burner Propane Stove for which we believed we could use just outside in a covered area; but propane canisters were out at most locations. That would mean rationed use to make the most of our one canister.

Thank Jesus that while we did have a number of power surges that Monday night with some less than two minute power outages, we did not lose power.

One of our family members are still without power as I write this article; they do have a power generator they’ve been using sparingly.

We got off easy compared to many others.

While they are calling storm Sandy the worst storm of our times (on the East Coast at least), and there may not be anything near that for some time, we are now thinking and re-thinking what we need to have on hand if there are any future cases where our office as well as home would be without power or Internet for extended periods of time.

If you were in the path of storm Sandy, how was your business impacted? Where you without power for any period of time? How did you make due in terms of managing your business (especially if it is Internet-facing / based)? Please share below.

I really appreciate being on both ends of giving and receiving as each encounter is an opportunity to learn, to adapt, to change, and to improve.

Part of that picture is hearing and seeing something you know makes sense and is true, and then growing into it (i.e. I know, I know… but don’t do… then ah ha… put it in action, silly).

One of the customer service 101 lessons involves being technically correct, but presenting the situation in a way that devalues the relationship.

In every relationship, you have choices. You can chose to always be right (i.e. technically correct), or you can choose to be in a relationship. If you value long term relationships like me, you will do your best to focus on the relationship rather than who is right and how often.

Every encounter you have with your customers, your employees, your partners is an opportunity for you to establish (or re-establish) relationship values or diminish them. The more they are diminished, the more likely the relationship will end.

Let me give you two examples. First is on the giving end, the second on the receiving end.

A customer puts in a support ticket about Spam Assassin incorrectly tagging valid email as being suspected as spam. In the email, the customer also complains about higher than normal real spam getting through.

A technically correct response might go into explaining Spam Assassins scoring mechanism, about white listing and how white listing only lowers the chance about tagging, etc. as well as just telling the customer to forward the actual spam that got through to the anti-spam appliance engineers.

A customer relationship response is to call the customer on the phone to go over the Spam Assassin settings, ask if it is ok to outright disable Spam Assassin (duplication of anti-spam — and in the particular case only tagging incorrectly), as well as go over the differences between the anti-spam appliance and Spam Assassin, the benefit of training the system. Plus empathizing with the customer for the spam that does get through by both disliking spam as well as sharing no system is perfect including our own anti-spam system.

The phone call also allowed a check in on an upcoming trip the client is looking forward to taking along with making sure the customer understands how much they are valued as a customer.

On the receiving end, I tend to perform backups more than the average person knowing the value of having a recent backup over an old backup or no backup at all. Some of the backups I take cover plan B and plan C for data recovery (do you have multiple plans for recover in case your primary plan doesn’t work as intended?).

One of the backup methods started failing, and I opened a ticket with the data center whose private network I was using to do the backup to see if they could help.

All of the initial responses were technically correct. Yet, all of them ended with, if you don’t respond within four days, the ticket will close. The problem still existed. I persisted and literally asked for a hero to step up to the plate (I’m sharing this because my personal feelings is that not all customers will be patient and ask for a hero when there appears to be no hero; they may just move on). The partner did step it up several notches, and moved from being technically correct to providing alternatives, in depth responses as well as viable alternatives and a phone call.

They were also open to passing along to the entire team about the differences between being right (technically correct) and being right plus promoting the relationship.

Please consider the following thoughts:

• You are in various relationships between family, friends, work, et al.
• Those relationships do matter.
• Does it matter who is right how often or does it matter more to have a long lasting relationship?
• As you respond to parties in your relationship is your focus about keeping and improving the relationship because the other party matters?
• What can you do daily to step up to the plate and be a hero?

What are your thoughts? Please share in the comments below.

I’m hoping to encourage you to review the documentation standards you have set forth for your small business; and potentially to do an in-house audit to ensure critical areas are covered.

In late August 2012, we received a call from the CEO of a small business whose web development person left their employment. They found out about our server administration services from SoftLayer as we are a SoftLayer certified partner.

They needed to update their web site for which they did not have the FTP login credentials; and they needed to generate a CSR (Certificate signing request) in order to renew the secure certificate for their web site so that https would continue to work.

Together, we hoped that given the server login credentials (which they did have on hand) that we could locate the FTP user, reset the FTP user password, and test FTP access with that information; and then use the server-based tools to generate the CSR for the secure certificate, and install it when they received it from the digital ID provider.

To keep the story short without going into the server administration details, the information they had on file was for a Citrix XenServer which was running multiple virtual machines. The web site for which they needed the FTP reset and a CSR generated was on one of the virtual machines.

There was no documentation as to which virtual machine other than a public IP address of the web site.

The non virtual equivalent is that you are given the keys to a safe. You open the safe and find several other safes within; and while you might be able to guess which safe is the right one within the safe, you don’t have the means to open it.

SoftLayer, whose extremely well automated portal, provided one of several means available to document the server environment; but notes were not put into the notes area for which private IP address belonged to which virtual machine which may also have helped.

While we were able to narrow down which virtual machine (aka safe) was most likely the correct one, ssh (remote access) appeared to be filtered by IP address… and you needed to access the virtual machine in order to tell it which IP addresses to allow.

The bottom line for this small business is potentially rebuilding everything from the ground up for costs in the double digit thousands of dollars (if not more).

• Employee handbook – ensuring it covers documentation expectations and requirements.
• Web site(s) – login credentials for every application, control panel, FTP, email, statistics / analytics along with daily, weekly, biweekly, monthly, etc. processes and procedures along with application names, versions, etc.
• Server(s) – specifications, login credentials, public IP, private IP. If there are virtual machines, the same — do you know where your servers are located? Names and contact information of responsible parties having what responsibilities?
• Change log – what installations, deletions, changes have been taking place — date, time, where, what, who, why, how, notes, etc?
• Contact information – name, company, mailing address, physical address, phone numbers, email, and when or why would they be contacted.
• Other? — What’s necessary for someone to take over your responsibilities if you are the last one standing, and need to pass on the baton?

As you do the audit, ask yourself (and hopefully check your thought process with trusted other parties) — if the responsible person for jobs a, b, and c were inaccessible tomorrow, would someone be able to take over quickly just based on the documentation that we have in place?

If the answer is “no,” then a level of priority should be given to making sure there is enough documentation (that is reviewed and tested for quality assurance) so the processes, procedures, tasks, and related responsibilities can be easily picked up by a new party.

Lastly, who knows where the documentation is located, and how to use the documentation?

Have you run into any nightmares in your business that proper documentation beforehand could have prevented or made less costly? Please share in the comments below.

Please allow me to share with you some lessons we’ve learned at Dynamic Net, Inc. from a lightning storm that took out our business phone system.

Several weeks ago we had a major power outage after a lightning storm that lasted several hours (depending on your geographic area or power company that might be very short or very long; for us it was long).

By the end of the day, we noticed that our business phone system wasn’t working the way that it should.

We didn’t notice at first because it is our goal to answer every single call — there are no menu prompts during business hours.

Once we hit after hours, we found out calls coming in were not receiving any menu and were going directly to our office manager’s voice mail.

If you are like us where you take every point of customer service seriously, you can understand our dilemma.

Since we do our best to Think Local, we did purchase our business phone system local to our physical place of business.

When we called them, we were told it would require a base fee of $212.00 (that included travel time to our office; they were approximately 30 minutes away) along with one hour of labor. Additional labor would be at $150.00 per hour.

While I felt the fees were on the higher end, I also knew we would be supporting a local business if we went through them; and they did provide value for the rate.

However, I was reminded of the main concerns faced by a lot of my fellow small business stewards — the uncertainty of the project.

The business phone system provider could not provide a ball park estimate so this could be a $212.00 project or a $812.00 project (if the tech was at our office for four hours) or much larger as parts were not included, and there would be the potential of multiple times back and forth to the office. Each one incurring the $212.00 base price.

While the hourly rates were within industry averages, and I can understand travel time having previously done on-site based work, the uncertainty of the total cost for maintaining a 15 or so year old system was unnerving.

Looking back, what surprises me is that the vendor did not present other options such as buying a new / replacement business phone system where the total cost can be known in advance.

The lesson I was reminded of here is that whenever you working with a customer, do your best to provide a narrow base line picture that caps their investment. Do give them options, and do cover your bases (you are not in business to lose money). When possible, give them two to three alternative choices (i.e. this is the cost to fix, this is the cost to replace or cost to fix, and here are two replacements).

The uncertainty of the cost to fix the existing, approximately 15-year old, business phone system encouraged us to look at alternatives including VOIP (voice over Internet protocol).

VOIP has come a long way over the past decade. Originally, the call quality was extremely poor; and your dial menu plans were extremely limited. Often times you had to have an expert create the dial plan; and should you need changes to that plan, incur further expenses updating it.

We did our home work in this area; and there were a lot of good choices out there — GetJive, Grasshopper, RingCentral, and many others.

Based on our needs, we settled in GetJive.com.

We paid approximately $260.00 for the IP-based phones (the original system cost approximately $3,000 — and just to fix it was $212.00 base plus uncertainty). There was no setup fee. We will save approximately $120.00 per month on our phone bill. We also have a web-based means for creating and maintaining our dial plan; and since we want to answer calls as we are able (goal is that no customer gets the phone menu), the system allows us to do that. We can even set up custom dial plans for our VIP customers; all without paying an outside party.

Two lessons learned:

• Whenever you working with a customer, do your best to provide a narrow base line picture that caps their investment. Do give them options, and do cover your bases (you are not in business to lose money). When possible, give them two to three alternative choices (i.e. this is the cost to fix, this is the cost to replace or cost to fix, and here are two replacements).
• Use any down turn as an opportunity to review options; be open to change and adapt as necessary.

What lessons have you learned when something bad happened in your business? Please share them in the comments below.

We do our best to buy products made in the U.S. even if we have to pay more to do so.

I would like to encourage you to do the same; doing so keeps more of the dollars you spend in the local economy. Plus your continued support of local businesses may help them keep their current employees as well as hire more employees.

If you live or work in Berks County, Dauphin County, Lancaster County, Lebanon County, Lehigh County, and York County, please give us the opportunity to earn your web and email hosting business by calling us at 1-717-484-1062 or 1-888-887-6727 or using our contact us form.

Since I believe it is important to put your money where your mouth is (live and do what you speak), let me share with you a partial list of the local businesses and organizations we have supported in 2012.

If you live or work in Berks County, Dauphin County, Lancaster County, Lebanon County, Lehigh County, and York County, please give us the opportunity to earn your web and email hosting business by calling us at 1-717-484-1062 or 1-888-887-6727 or using our contact us form.