WCL Bauld Insurance Risk & Business Magazine by Tulip Media Group

W.C.L. Bauld Insurance

Reputation: Protecting the Cinderella Asset Michael McQuaid How Much is that New Customer Worth to You? Doug Daley The Role of the Public Sector in Economic Development Gary Belding Everything is our Problem John DiJulius Five Insights for Sales Success Russ Mallard Profit from Employee Ideas and Engagement Verne Harnish Environmental Fines and Penalties Marcus A. Raitanen

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CONTENTS Reputation: Protecting the Cinderella Asset - Michael McQuaid

How Much is that New Customer Worth to You? - Doug Daley

The Role of the Public Sector in Economic Development - Gary Belding

Building your A-Team Players - Andy Buyting

Everything is our Problem – John DiJulius

Five Insights for Sales Success – Russ Mallard

Profit from Employee Ideas and Engagement - Verne Harnish

Environmental Fines and Penalties – Marcus A. Raitanen

The Most Unhealthy Spot in Your Office – Stuart Blair

Business Insurance Coverage Checklist

Commercial Insurance – Don’t Shop ‘til they Drop! – Steve Earle

1262 Bedford Highway, Bedford, NS B4A 1C7 Ph: 902-835-1262 Fax: 902-835-2604 www.wclbauld.com W.C.L. Bauld Insurance Risk & Business Magazine is published by Carle Publishing Inc. All content, copyright © 2013, Carle Publishing Inc.All rights reserved.

W.C.L. BAULD INSURANCE

This publication may not be reproduced, all or in part, without written consent from the publisher. Every effort has been made to ensure the accuracy of all content in this publication, however, the publisher nor W.C.L. Bauld Insurance will be held responsible for omissions or errors. Please address all editorial and advertising inquiries to Carle Publishing Inc., 60 Shayla Court, Fredericton, NB, E3G 0N3, Canada. Carle Publishing Inc. is not held responsible for the loss, damage or any other injury to unsolicited material (including but not limited to manuscripts, artwork, photographs and advertisements). Unsolicited material must be included with a self-addressed, overnight-delivery return envelope, postage prepaid.

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EDITOR IN CHIEF

PUBLISHER CREATIVE & DIRECTION DESIGNER CONTENT COORDINATOR CONTRIBUTORS Carle Publishing Inc. and W.C.L. Bauld Insurance will not give or rent your name, mailing address, or other contact information to third parties. Subscriptions are complimentary for qualified individuals. Printed in Canada by: ADVERTISING COORDINATOR Graphic Design and Layout Provided By: Carle Publishing Inc. PHOTOGRAPHY Fredericton, NB

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Andy Buyting Carle Publishing Inc. Carle Publishing Inc. John Christenson John Christenson Michael McQuaid John DiJulius Andy Buyting Gary Belding Stuart Blair Verne Harnish Doug Daley Marcus A. Raitanen Russ Mallard Andy Buyting (National) Steve Earle (Local) All images sourced from Carle Publishing Inc. or istockphoto.com unless otherwise identified.

WELCOME TO RISK & BUSINESS Honestly…… As a business owner or manager you’re always looking for new and creative ways of marketing to potential customers. Obviously, this is one of ours.

You’ve looked for knowledge and professionalism, service and understanding of your business……a relationship that helps your business succeed.

Perhaps I should be writing about a bunch of made-up altruistic reasons we’ve taken on this initiative but I won’t, and for a couple of reasons. First, as a business professional, you’d see right through it - so why bother. Second, it’s not in our company’s nature to be anything but stratight forward. (Which may, or may not, seem refreshing to you – given we’re in the insurance business)

Our intent for Risk & Business Magazine is two-fold (and in this order): 1) you’re introduced, or reintroduced, to our brand for your commercial insurance requirements, and 2) because as you know, it’s all about “adding value”, whether you’re a client now, or not, become one, or don’t, you might just get a little more beneficial information from this magazine than you would if we rented a billboard.

What’s a billboard cost?? I’m not really sure – but I know it’s a lot of money. Have any one of you ever been prompted to buy commercial insurance from one provider or another because you saw a billboard?? I doubt it.

We hope you enjoy it.

Steve Earle

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WHAT’S NEW AT WCL BAULD INSURANCE! For over sixty five years WCL Bauld Insurance Brokers has provided Nova Scotians with insurance for their homes, cars and businesses. A lot has changed in that time, and more so recently. So how does a “down on the corner” community business continue to compete against all the new “big box” insurance providers like banks, group plans and national agencies? Easy – just do the same thing we were doing in 1947.

Building relationships and providing service like it’s still the 1950’s doesn’t mean the conveniences of the new millennium have to be ignored. On-line service, quoting , claims, twenty four hour telephone response and a copy of your policy sent to your smart-phone are all part of the way it can be done now – if you want.

When William (Buck) Bauld started the firm back in the forties, getting an insurance quote on-line and having your policy emailed to you was an inconceivable concept. What mattered was the service supplied to his friends and neighbours. Knowing where they lived, what their business needs were, and acting on their behalf if they had a claim.

But…… if you still value the option of sitting down and speaking with someone down the street, we’d be happy to see you. Either at your place of business, or you can drop by one of our locations in Bedford, Dartmouth or Antigonish – and coming this summer, Bedford South (at the corner of Larry Utek and Nine Mile Drive).

Competing now with big bank insurance companies, national agents, internet and foreign call-centre providors and more and more insurance company owned brokers, WCL Bauld has remained a customer focused independent local insurance broker.

Dartmouth

Antigonish Bedford

Coming this Summer – Bedford South 6

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If you were to ask a business owner or board of directors, as many surveys have done, “ what is the key business driver that sustains growth and profitability?”, their answer will most likely revolve around their reputation. If the question were turned around, “what is the 2 am wake up call?”, usually the concern will have some nexus with damaged reputation.

Whether you are a private or public company, profit or not for profit, reputational stakeholders have the ability to either reward or punish an organization. Reputation, as a business catalyst, has great potential, making up over 60% of a business value. But, like the fairy tale princess Cinderella, reputation is often overlooked or misunderstood as some esoteric, unquantifiable asset. The different business functions: sales & marketing, human resources, information technology, production, research & development, all operate with their own distinct objectives. Each has the ability to contribute or detract from the entire organization’s reputation based on the quality of their relationships they maintain within their stakeholder network. Does the entire organization enhance reputational value? 8

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Reputation

Michael McQuaid

Protecting the Cinderella Asset Warren Buffet’s ubiquitous expression that reputation takes over 20 years to build and 5 minutes (or virally 5 seconds) to destroy, does place emphasis on the length of time to build a solid reputation and how fast it can be de-valued. But to adequately protect an organization’s reputation, it is necessary to challenge the more conventional perception of reputational risk. The more sensational media portrayal of reputational risk is a solitary, fortuitous event like a fire, product recall or environmental catastrophe. The less glamorized possibilities can be gradual erosion of market share based on customer dissatisfaction (more detractors than promoters?), inability to attract investors, negative employee or ex employee commentary, client or employee litigation, or regulatory scrutiny. A well rounded perception of reputational risk and its management will encompass a wider perception and response across key departments. A business reputation can be negatively affected by catastrophic hazard risks: the fire, product recall, invasion of privacy through security breach. A disaster recovery plan is necessary to ensure continuity of business operations and is critical to survival. Recent surveys indicate that if a business does not re-open within 10 days, they are unlikely to survive. And of equal significance, how an organization responds to a crisis event is just as important. Crisis Management is relationship management of your key stakeholders: media, investors, customers, regulators, employees and the public. The conduct of the organization post loss could impact its reputation, and the strength of its reputation will aid in recovery. A common example of a hazard risk is an industrial fire releasing environmental contaminants into neighbouring properties and waterways. The crisis management objectives should be concerned with managing reputation in these key relationships: media, provincial environment regulators, workplace health and safety, employees, customers, supply chain partners and investors. If the loss were a product recall or breach of information security, the impact on relationships would be similar. The strength of a

reputation instills confidence in the stakeholders allowing for a more complete recovery. There should also be an acute awareness of the less noticeable but equally vital drivers of reputation. Intuitively, we would say customers and potential customers drive an organization’s reputation with repeat business, advocacy and referral. It is no secret that customer satisfaction drives reputation, that great customer service is rewarded with loyal customers promoting the business. Dissatisfied client experiences, and they are not always apparent, detract from the organization’s reputation. A bad experience will need a disproportionate amount of good experiences just to recover. Social media can be an unapologetic, uncensored and unfounded forum for disgruntled customer experiences that can tarnish a business. Motivated and well trained employees drive customer satisfaction and drive the company’s reputation. The culture created drives the reputation of the organization as an employer and its ability to attract and retain talent. Risk management responses will evaluate the availability and cost effectiveness of insurance solutions. Most insurance policies are geared towards hazard type losses, but special attention should be given to particular vulnerabilities, for example- environmental or information security breaches. There are specialized policies that can compliment traditional property/casualty programs. Insurance coverage innovations include the introduction of reputational risk products. Be careful! For the most part, they are designed only to cover the legal costs in handling media relations after a defined loss. If reputation drives growth and profitability, and at the same time, has the potential to diminish value in a single event or over time, then a holistic perception is needed. Understanding your Cinderella asset will not only allow you to protect it, but leverage it. RISKY BUSINESS MAGAZINE

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How much is that new customer worth to you? Do you know what your most valuable business asset is? If you are like most business people, you quickly think of your balance sheet. Is it your equipment? Is it your location? Your people?

Doug Daley, Kiers Marketing Group

new customers to justify the extra cost if you consider the potential lifetime value of that new client.

For most businesses, the most valuable business asset isn’t any of the above. It’s their customer list. And businesses that don’t identify this as their most valuable business asset should change their thinking. The hardest, most expensive sale we ever make to a customer is the first one. In that first, critical transaction, we earn or lose the trust of the customer. Once we have their trust, the door opens to many more sales and referrals, which most of us agree, are the very best new customers to get. When you get a new client, do you ever consider what the potential lifetime value of that customer might be? The lifetime value of a customer is a measure of the customer’s value to your business. It is the customer’s potential contribution to your business over a period of time. When you consider the lifetime value of a customer, you’ll have an idea how much you would – or should be willing to – invest to acquire a customer. When you look at your marketing, don’t just consider the initial sale you make, consider what the lifetime value of that customer might be. By thinking this way, it’s easier to consider increasing your marketing efforts. Instead of building the Lada of websites, build the Lexus instead. You don’t have to attract many more 10

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Another consideration when looking at the lifetime value of a client, is not only how much they will spend, rather, how many potential customers they will refer to you. When you think of it this way, the potential value of a customer could increase ten-fold. How important is word of mouth and referrals to your business? You probably can’t put a price tag on it. I’m sure most businesses have no idea how much revenue is generated this way, but there is one way to find out – ask.

Doug Daley is Vice President of Sales and Marketing with Kiers Marketing Group in Fredericton. Doug can be reached at ddaley@kiers.com or by visiting www.kiers.com.

When a client calls or drops in for the very first time, ask them how they found out about you. They may have seen an ad or visited your website, but I will venture a guess that most of them heard about you from a satisfied customer. It’s easy to ask this question and most people will give you an honest answer. You will probably discover that a customer who spends very little with you is actually worth a lot more than you ever imagined. How do you say thanks? Send them a thank you card, a small gift or take them to lunch. This will let them know you appreciate them and in turn, they will send you more business. Another great idea is to set up a formal referral program where customers are regularly rewarded for their efforts. The Fredericton Chamber of Commerce has a referral program where referrers receive a $25.00 gift card from a local restaurant for a referral that joins the Chamber. I have personally received many of these so you bet I’m going to tell businesses about joining the Chamber. Reward your referrers and never underestimate a client, no matter how small they are. The lifetime value could be much larger than you imagine.

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Not only may they become a loyal customer for the next 20 years, they may also refer many friends and family members. It’s okay to spend a few extra bucks upfront to acquire a new customer – it usually ends up paying dividends for many years to come. Congratulations! By choosing us you’ve helped save billions of pounds of junk from the landfill.

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The Role of the Public Sector in Economic Development Government at all levels continue to boast about job creation. The public sector can initiate the economic climate to stimulate the economy but it is the private sector that creates the jobs and allows the public sector to take the credit. The private sector is the driving force to grow the economy, so the question becomes what is the role of the public sector in economic development?

Generally, the public sector uses incremental job creation as a quantitative measurement for the financial assistance provided. It remains uncertain if industries would still re-locate without the incentives. It is also impossible to measure the impact of economic results that do not happen. However, the public sector no longer hosts the resources to continue the practice of rich incentives.

Stimulating and growing the economy is paramount in order to generate a tax base for governments to fund expenditures in other areas such as health care, education, infrastructure, social programs, etc.

Balance budgets are now the focus of most provinces and jurisdictions and much wiser choices and approaches are needed in todayâ&#x20AC;&#x2122;s economic climate.

The general perception is that government in all provinces and jurisdictions provide financial incentives to stimulate the economy which is only part of the economic formula. The public sector has a hope chest of direct financial incentives including non-repayable contributions, provisional repayable loans, interest free loans, direct loans, loan guarantees, payroll rebates, equity participation, etc. This is an expensive game, but sometimes necessary, when competing globally in domestic markets as well as attracting foreign investment. The public sector often attempts to attract companies to their jurisdiction purely on financial incentives alone which begs a further review. Both the private and public sector, prior to investing in a relocation or expansion must consider if the investment makes strategic and economic sense in both the short and long term. Considerations must include such variables as competitive wage costs, a trained workforce, geographical location, low operating costs, proximity and access to the appropriate mode of transportation, natural resources, and supporting industries. Unfortunately, incentives come and go, and so often do the companies in receipt of these incentives. 12

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There is no direct evidence that lower corporate income tax rates or tax credits stimulate growth. Income tax rates and tax credits assume profitability which is not an immediate incentive for domestic companies that may incur losses in the initial years. It is of definite interest to larger enterprises wishing to re-locate or expand. As a standalone incentive, it is not enough to spur economic development. Other considerations include, but are not limited to, the following: Trained Workforce Creating year round sustainable incremental employment is important but the focus has to be on creating the best jobs possible. Provinces across the country have seen shifts in young workers migrating to the more prosperous provinces which have been occurring for decades. Many provinces have attempted to counter that shift with limited success. The public sector has to continue its work with the private sector and the post secondary institutions in matching the need of industry to the training programs in both the short and long term. Keeping a trained workforce at home is a key ingredient to growing the economy.

Gary Belding, Belding Business Financing Solutions

Red Tape Reduction Reducing red tape saves both time and expense for the private sector. Strides have been made in many provinces but there is still room to reduce the barriers and antiquated bureaucracy, such as fees, forms, permits, processing delays, etc. There are still limited use of on-line forms and applications in many government departments and agencies. Defining Effective Strategies Every province and jurisdiction must know how to utilize and exploit their strengths and resources while at the same time know their limitations. Adopting new strategies requires time and huge investments resulting in a huge gamble. Targeting and focusing on key strategic and growth sectors and sharing success stories can be a magic formula. Research & Development R&D is a priority and focus in all provinces and jurisdictions across Canada and commercializing new technology is definitely a race to the finish line. Public Procurement Projects Large provincial and federal contracts can be a life line to many smaller enterprises as sub-contractors. These projects can create huge spin-off effects for the local economy as part of the supply chain. The public sector must ensure that local companies qualify to participate in these opportunities.

Gary Belding has worked in both the public and private sectors for in excess of 38 years and understands the world of financing. Gary was the former Manager of Financial Programs with Business New Brunswick, the economic engine of the provincial government. Gary has the experience, knowledge and is able to navigate through the financial landscape and now operates his own business, Belding Business Financing Solutions, www.beldingsolutions.com

In summary, small business continues to be the foundation for economic prosperity. The public sector must continue to ignite the economy by allowing the growth and expansion of domestic industries while attracting foreign investment. The public sector must manage its own expectations and not try to be all things to everyone especially when exploring ways to increase revenues and reduce expenditures. Every province and jurisdiction is attempting to focus their attention, energies and strategies in similar direction in attempts to lead the charge in economic development, seldom resulting in new ideas simply a revised approach.

Finale: Limited resources means smarter choices.

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Building your Team of A-Players Screening for top performers starts with marketing. Find the best people with the best job ad. MEN WANTED for hazardous journey, small wages, bitter cold, long months of complete darkness, constant danger, safe return doubtful, honor and recognition in case of success. Ernest Shackleton, 4 Burlington st. This was a job ad that appeared in The (London) Times, on December 29, 1913 in England. The ad was placed by Mr. Ernest Shackleton as he was assembling a team of explorers to do the impossible, to be the first team to traverse the harsh continent of Antarctica. In 1914, Shackleton set sail with his team of 28 men. As the legendary story goes, his team reached Antarctica only to encounter disaster early into their voyage. While attempting to traverse the uninhabited continent, Shackleton’s vessel became shipwrecked, and all 28 men were stranded, alone. With no hope of assistance from their home country, it was solely up to the explorers to survive their predicament on their own. Believed to be perished by his homeland, less than three years later Shackleton and his team shocked the people of England when they resurfaced, fully intact. In 1914, 28 men embarked on their voyage, and in 1917, 28 men returned, alive. Why did Shackleton and his team survive despite the unlivable conditions they faced? How could all 28 men return from what should have been the demise of each and every person? Many experts turn to the original job ad that was placed in The Times;

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I ask you; “Would you respond to this job ad?” When I poll audiences I regularly speak to, the answer is invariably; “No way!” The question then begs to be answered; “Who in their right might would?” Who in their right might would apply for an ad that describes the job as hazardous, small wages, complete darkness, constant danger, SAFE RETURN DOUBTFUL! Who? I’ll tell you who – the right kind of men, that’s who. It attracted men who were tough enough, both physically and mentally, men who shared the same purpose, values and tenacity as Shackleton, men who could face the most insurmountable odds and never give up in their mission to survive. Those are the types of men that he needed. Those are the types of men who he ultimately recruited. And it’s because he was able to assemble the right team, a team of A-Players for that mission, that he and the others survived. Now let’s compare that to a typical job ad you may read in your local newspaper or online these days. A job ad that reads;

Great Opportunity at

ABC Company

Our growing company serves the XYZ markets with innovative products and services. To help us expand our operations, we are looking for motivated individuals, who want to join a successful team of experienced professionals. You must be dynamic, organized, hard working and looking for an enjoyable place to work. We offer great benefits packages, blah-blah, flexible work hours, blah-blah, opportunities to grow, blah-blah, and we love each other, and the sun always sets on our offices, and, and, and…

Andy Buyting, Carle Ventures

You get the point. Most existing job ads all sound the same. The problem is that no job is all roses. Every job has its low points, downsides and bad days. So why do managers consistently insist lying in their job ads? The inevitable result of such an approach is that the successful applicant who is hired starts their job and within a very short period of time realizes that the job they applied for is NOT the job they ended up with. And they quit in search of something else, something better. Within the Hiring Right Recruiting System, the very first step I take with clients in developing their recruiting process is to create the right “Shackelton-Type” job ad. That is an ad that sells potential candidates on the purpose and values of the company, but also warns them of the downsides or low points of the job. If an ad is brutally honest about a job high and low points, then applicants will self-screen to a great degree before even applying. To do this, we interview the hiring managers as well as key front-line staff who are successful in the job in question, and we ask them a number of questions. The two most effective questions include to ask are; If a friend or family member wanted to apply for a job here, what would you say are the great things about working for this company? If a friend or family member wanted to apply for a job here, what would you warn them about? What are the low points of the job or company? With those answers in hand, you have some of the most important points that must be made within the job ad itself. A few (real life) examples from past clients include: Call centre setting where working night shifts are a necessity for new employees. A couple lines in the ad read;

Andy Buyting is the developer of the Hiring Right Recruiting System. Andy works with organizations of all sizes to develop and successfully implement customized recruiting processes as well as coach managers on all types of HR issues. Learn more at www.AndyBuyting.com

How about a brake shoe manufacturer where the work is dirty, physically demanding and can get very hot. We purposely targeted university athletes for summer employment with an opening line that read: “Are you tough enough to work here? Looking for a physical Challenge?” It goes on to say; “…can be a dusty and dirty place to work, and during the summer it can also get very hot. All reasons why it’s a perfect fit for athletes looking to improve their physical performance…”

A large childcare centre looking for Early Childhood Educators who will fit with the organization and its dedication to the children in their care, had an ad that appealed only the right kind of people when it read: “Working in a childcare centre is NOT for everyone. You must have an enormous amount of patience, empathy, patience, love for children and even more patience. Working with active children does get messy at times, especially during flu season… “ – do we need to expand?

It goes without saying that if you want the best applicants, you need to start with the best job ad. That means selling candidates on the high points and greater vision of the organization, absolutely. But that also means being frank about the low points of the job as well. If you sugar coat the down sides of a job, you’re only setting yourself and your future employee up for disappointment and failure.

“Working in a contact center is NOT for everyone. As a new employee, you will be expected to work 4pm to 1am shifts for your first few months. Those who perform well may have the opportunity to earn flexible scheduling as well as great monthly incentives.”

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EVERYTHING is our problem Write it down. “EVERYTHING is our problem.” Say it out loud. When businesses take the “it’s not our fault approach” there is only one solution: threaten and punish the customer, which means you won the argument but lost the customer. The first company I started, John Robert’s Spa, demonstrates the perfect example. Guests would sometimes leave their valuables (jewelry or cell phone) in the pockets of the robes. This meant the guests’ possessions could get washed and/or lost when we did our laundry. It’s not the spa’s fault that the guests leave their stuff in the robe pockets. The first remedy was to leave a sign inside the lockers and changing room stating, “We are not responsible for any valuables left behind.” A huge negative cue, it is basically threatening and punishing customers. So we changed that to “Please remember to check your robe and locker for all your valuables.” Better, but it didn’t eliminate the problem. Now what? Can we train our Spa Attendants to check every robe, every time before washing? Only in a perfect world. So we found a supplier who provides pocket-less robes. Problem solved. One of the hospitals I consult with has always had an issue with patients being late for their appointments. Big problem! More than half their patients were late. It wasn’t a result of patients not respecting the hospital’s time, or poor planning. It was because the hospital is so large (literally stretches for several blocks). Once patients found the correct building and parking garage, then the real challenge began -- walking and finding the office in a maze of buildings and hallways. Solution #1 (Threaten & Punish) The hospital could warn the patients that they will forfeit their appointment if they are late but still be charged for the visit. Obviously this is not exactly the approach a business wants to take with its customers.

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Solution #2 (Allow for this in hospital’s scheduling) Allow for more time with each patient to build in for the fact that they will be late. This results in fewer appointments and patients seen per day. Not good financially for the hospital, and not good for the patients who need to get in quickly. Everything is our Responsibility – Realizing how critical this is to running a successful business, the hospital finally did two things. 1) Staffed more recognizable volunteers all over the hospital to help direct patients to their destination, and 2) borrowing from Disney, they created a GPS APP for smart phones that directs patient to the proper place on their property (i.e. Building P, office 515). After an exhilarating day at Disney, your family is leaving Magic Kingdom Park. It is 8:30 pm and you are in the parking lot. All of you are exhausted and impatient to get back to your room to shower and hit the sack. You look at your spouse and ask, “Where did we park?” She looks at you and says, “You’re kidding-right?” Neither of you remembers where you parked. So how hard can it be to find your car? Like 20,000 other people, you came here in a rented white minivan. There are miles and miles of white minivans in the parking lot. Your only option appears to be to wait until the park closes at 11 pm and see what white minivans are left. Whose fault is this: Disney’s, yours, or your spouse’s? Should Disney be responsible for reminding you where you parked? Disney, however, is aware that the average family visiting today traveled four hours, they arrived in a white minivan, and before the driver put the car in park, the kids opened the door and were running for the entrance. The parents are too concerned about catching up with their kids to stop and think about where they parked. Disney already knows that tonight a number of families will return exhausted to the parking lot, not remember where they parked, and just want to get back to the hotel.

John DiJulius, The DiJulius Group

What does Disney do? They anticipate a major service defect. And they solve it, even though it isn’t their fault. They have people drive around the parking lots in golf carts in search of families that look lost. A Disney Cast Member pulls up to your family and says, ”Did you forget where you parked?” You nod and say, “We’re driving a white minivan. Does that help?”

John DiJulius - known as The authority on World-Class Customer Experience. He is a best selling author and works with companies like The Ritz-Carlton, Starbucks, Pwc, Nestle, Norstrom, Chick-fil-A, and many more. John can be reached at john@thedijuliusgroup.com

“Do you remember when you arrived? A ballpark time will do.” “About 11:15 to 11:30 am.” The Disney Cast Member checks his clipboard and says, ”Between 11 am and noon we were parking in the Goofy section. Jump in! I will take you to that section, and we can find your car with your remote key.” And it’s done. Was it Disney’s fault that you lost your car? Absolutely not. Is it their problem? Absolutely, yes, because Disney knows that every day several people will lose their cars and potentially be stranded for hours, a situation that could totally ruin the memory of their Disney experience. This is a great example of what being zero risk is all about. Being zero risk applies regardless of whether your company is at fault. World-class service companies create protocols to proactively handle their most common service defects, and they train their employees how to extinguish small flames long before they turn into a raging fire. Even if a defect is not your fault, your customer will associate the issue with doing business with you. This is a critical issue for all businesses, at all levels, because when these situations arise, in the vast majority of instances, the employee immediately and instinctively becomes defensive and responds, “It’s not our fault.” Managers and front-line employees alike are shocked that the customer expects the company to be responsible and make it right. The best way I have found to truly embrace the EVERYTHING is our problem mindset it to do the “Pay what you think is fair” exercise. When you think about how your customers can “short-pay” you for any reason, you will not believe how creative and solution-orientated you become with everything. Find your pocket-less robes. If you really train everyone in your company to have the mindset that EVERYTHING is your problem and responsibility, and you remove the victim mentality of “it is our customer’s fault,” your company’s customer experience will elevate to new heights. You’ll find solutions that eliminate the problems and make your company more efficient, and your customers happier.

RISKY BUSINESS MAGAZINE

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Five Insights for Sales Success As a child, your parents likely did not tuck you in to your bed and whisper in your ear “Get a good night sleep because we want you to grow up to be in sales someday.” A career in sales is often well down the list of career choices, if it makes the list at all. Surprisingly though, as many as one in nine Canadians earn their living through a sales role. However, if you reflect on this subject for a moment, everyone is in sales in one way or another. We had to learn how to sell our ideas on the home front from an early age to get what we wanted from others. It continues today with our personal and business relationships. The more effectively we can communicate our ideas, the more quickly we can come to a conclusion as to whether or not we get what we ask for. Since time is so valuable, if we are going to get a “no”, then the sooner the better! Here are Five Insights for Sales Success that should help you sell more and sell more quickly. 1. It’s just as important to disqualify a selling opportunity as it is to qualify it. Many people in sales have advanced cases of what I refer to as “Happy Ears”! They only hear want they want to hear. Obvious signals can be missed from the prospect, such not having money available right now to purchase from you or, that he

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or she simply does not have a problem that requires fixing. I recommend a sales rep to maintain a healthy level of skepticism and “GO FOR THE NO” as early as possible. 2. What the prospect wants and what the prospect actually needs are rarely the same. Perhaps one of the greatest skills a sales rep can acquire is the art of asking great questions and then listening carefully to the prospects answers. The discovery process you take a prospect through, about a problem he or she is experiencing, is critical in getting to the real issue. I know from experience, that the first problem a prospect tells me about is rarely the real problem. Keep digging and help the prospect discover how your product or service can help him have less of what they don’t want and more of what he does want! 3. When the prospect says, “Money’s no problem,” it’s guaranteed to become one. A sales rep may ask a prospect about his or her budget for a purchase and the prospect might respond with “Money’s no problem.” Instead of taking extra steps to nail down a budget at that time, the sales rep pushes on only to discover later that money is indeed a

Russ Mallard, Mallard & Associates Ltd.

problem! To save time for you and the prospect, establish that the prospect is willing and able to spend the money required for your solution. Remember: No Money, No Sale! 4. When a prospect states that he can’t make a decision - he just did. Are you getting too many “think it overs” at the end of a sales call? If so, there is likely a problem with your sales process. Most “think it overs” are just a prospects way of politely telling you no. Happy Ears can again get in the way! The next time you get a “think it over”, why not suggest to your prospect, in a nurturing way, that it sounds like now may not be the best time to move ahead and offer to “close the file”. He will either agree with you and you can close the file, or he may tell you that he really does want to do business. Clarity is the goal here. 5. If you wait for your customers to voluntarily provide you with referrals as a reward for the exceptional service you have delivered, you’ll be waiting a long time. Congratulations, you got the order and you have

Russ Mallard is an award winning trainer, the president of Mallard & Associates Ltd., Moncton and Fredericton NB and is the authorized licensee for Sandler Training, the global leader in innovative sales and management training. For a free paperback booklet of “Why Salespeople Fail … and What You Can Do About It!” contact Russ Mallard at Sandler Training at Rmallard@sandler. com or call us at 1-888-854-7611. www.mallard.sandler.com

done a great job for your customer! Referrals can be your best source of new business, so take a few minutes and ask your happy customer if he or she could provide a referral or introduction or two for you. Make it easier for them to refer prospects to you by explaining the characteristics of an ideal prospect for you, such as the typical industries you serve, and the size of companies you prefer to work with. This way the referrals you get will be a better fit. One last tip; if you are given a referral, be sure to follow up with the prospect in a timely manner and don’t hesitate to refer your new customer to your network as well!

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SPRING 2013

Profit from Employee Ideas & Engagement When Gabe Fasolino was hired as a plant manager at a manufacturing company, he heard rumors that there were problems with drug and alcohol use among the workers. Clearly, this was a sensitive situation. A heavy handed approach to cracking down on the abuse could easily put Fasolino into an adversarial relationship with his employees. Wisely recognizing this, he turned to the company’s safety team, made up of hourly production workers, for ideas. They came up with what he describes as “the fairest, simplest, easiest-to-administer substance policy I have ever seen.” That experience took place in the late 1990s, but it taught Fasolino, now a business consultant, an important lesson: Engaged employees are a powerful asset. He’s since turned to workers for ideas on everything from pay scales to profit-sharing plans. “In every case, turnover dropped, while profits and morale soared,” he says. At a manufacturing firm that had lost money over three years, Fasolino tapped employees’ ideas and generated a 25% sales increase in nine months. Offering employees a say in the decisions that affect them is one of the best tools for engaging their hearts, minds and souls so they are motivated to give their all—and to make better choices as a company. However, many business leaders have let employee engagement fall by the wayside while trying to navigate the post-recession economy—and inadvertently made it harder to achieve the results they want. A Towers Watson survey of 32,000 employees around the world in 2012 found that only one-third are highly engaged—excited about company goals, energized while they’re at the office and free of obstacles to getting their work done. Another global survey by the consultancy AON Hewitt in 2010 found that engagement was at an all-time low, with employees fatigued by prolonged uncertainty, stress and confusion. 20

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HIGH ENGAGEMENT = HIGH OPERATING MARGINS When employees are disengaged, performance drops. Towers Watson found that among companies with low engagement, the average operating margin was 9.9%. Those with high “traditional” engagement—where employees were mainly motivated with rewards like a bump in pay—averaged 14.3%. Those with high “sustainable” engagement fared the best, with an average operating margin of 27.4%. This group of companies focused on building a great culture by promoting employees’ well being, treating them with respect, coaching them to improve performance, maintaining honesty and integrity, building a strong reputation and other practices that made employees feel great about coming to work.

Verne Harnish, Gazelles International

22% GREATER RETURNS, ON AVERAGE These findings were not an anomaly. AON Hewitt also discovered a connection between employee engagement and performance. It found that organizations with high levels of engagement outperformed the stock market and posted returns 22% greater than average in 2010. Those with disengaged employees posted returns 28% lower than average. The survey found that the top three drivers of engagement were career opportunities, recognition at work and brand alignment. BETTER DECISIONS Including employees in decision making doesn’t just make them feel better about work—it leads to smoother operations. In Fasolino’s case, his team created a policy in which any workers who showed three signs of substance abuse from a government checklist would have to take a drug and alcohol test. If they failed once, they’d have to go to rehab before returning to work and would be subject to a random drug test during the 12 months after that. If they failed again, they’d be fired. When one employee failed twice, he told Fasolino, “You should fire me.” He and all of the other employees knew that was the only fair course—thanks to the policy they crafted. UNLEARNING THE LESSONS OF BUSINESS SCHOOL How can leaders foster greater engagement? The first step is ditching the mindset that many executives learned in business school. “They feel they can get results by telling people what

Verne is founder and CEO of Gazelles, a global executive education and coaching company, Verne has spent the past 30 years educating entrepreneurial teams. He’s the author of Mastering the Rockefeller Habits which is endorsed by over 100 CEOs of mid-size companies and is published in ten languages.

to do,” says Fasolino. This stale thinking is often reinforced by their peers. A boss who complains to other execs about problems with an employee is likely to hear: “You need to fire the guy,” says Fasolino. “They’re not going to say he doesn’t have enough freedom, autonomy and purpose in his job.” Employees want rules and boundaries, but, at the same time, need to be heard. They want to work toward a mission that’s bigger than earning a paycheck. If your employees are unmotivated and your company is underperforming, now is the time to look within—and turn things around! ALIGNED INTERESTS = SUPERIOR RESULTS When Ottawa based Healthy Smiles Dental Clinic wanted to increase its number of new patients, the leadership team decided to create a theme that would align its entire staff. Working with their Gazelles Business Coach, Andy Buyting, they rolled out their “Twelve Weeks before Christmas” theme. The quarterly theme involved a referral program that was fueled by their employees each day, and tied to monthly rewards for successful engagement. It was supported with weekly targets and rewards, all tracked on a large scorecard for everyone to see. If the entire team achieved their overall objective for the quarter, Christmas dinner was on the company’s dime, as each employee was given a turkey and a gift card to their local supermarket on their last day at work. The results were astounding! For years, new patients to the clinic averaged 15-20 per month. With the “Twelve Weeks before Christmas” theme employee engagement was through the roof. In trying to hit what seemed like an insurmountable goal of 178 new patients for the quarter, the leadership team could not have been more pleased with the outcome. With the entire clinic totally aligned toward one objective, they pulled off a massive win (as a team) when the final number of new patients for the quarter came in at 187! Needless to say, the owner Dr. Shahram Yazdani was more than happy when he placed his order for 20 turkeys to be delivered to the clinic on December 21st.

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SPRING 2013

Environmental Fines and Penalties can be Cost Are you Prepared?

Public awareness and concern for the fragility of our natural environment has heightened in recent years. In response, legislation to protect the environment has been introduced at all levels of government in Canada, with fines and penalties for environmental infractions. It is important that business owners be aware of the environmental risks posed by their businesses, given that in some cases the assessment of fines and penalties has been as high as $300,000.

The list of environmental legislation in Canada is lengthy: the Federal Government has imposed the Canadian Environmental Protection Act along with the Fisheries Act and Dangerous Goods Act; the Provinces and Territories each have their own ‘environmental protection acts’ and ‘clean water acts’; and even some municipalities have had environmental powers delegated to them. Businesses that fail to comply with this profusion of regulations may be hit with fines and penalties from each level of government. But, there is a way that business owners can protect themselves. Did you know that assessed fines and penalties can be covered under an ENCON environmental liability policy if they result from an insurable claim for third party bodily injury or property damage?

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Consider the following two Canadian legal cases: Clark Builders/EPCOR Utilities The Royal Glenora Club in Edmonton, Alberta, hired Clark Builders to construct a new aquatic centre. During construction, a watermain owned by EPCOR utilities, was moved to an area believed to be outside of the proposed building area. The new location, however, was not marked out on the site, and when the piling subcontractor arrived and began drilling for the foundation installation, they struck and ruptured the watermain. This led to the discharge of approximately 12 million litres of chlorinated water into the nearby North Saskatchewan River, which is a diverse natural fish habitat. Following the accident, the water in the river was found to contain a chlorine content 3900 times greater than permissible. As a result, Clark Builders was charged under section 36(3) of the Fisheries Act and ordered to pay a total penalty of $285,000. This penalty consisted of a $15,000 fine and $270,000 payable to the Environmental Damages Fund, which will be used for the purpose of conserving and protecting fish and fish habitat in Alberta. R. V. Van Waters & Rogers Ltd. An employee of Van Waters & Rogers, a chemical distributor in Calgary, Alberta, who routinely filled tanker cars for transportation, inadvertently reversed the hoses on some pumping equipment which led to a tanker being overfilled. A total of 18,000 litres of xylene, a chemical solvent, was spilled onto the surrounding property. Some of the spilled xylene was absorbed into the ground, but some also made its way into a nearby catchbasin connected to the municipal sewer system. In fact, a City employee detected xylene in the sewer system as far as 18 blocks from the spill site.

tly:

Marcus A. Raitanen, Senior Underwriter, ENCON Group Inc.

Following the accident, Van Waters & Rogers undertook $70,000 in upgrades to their facility to reduce the risk of future spills from occurring. Notwithstanding this, a fine of $80,000 was levied against Van Waters & Rogers under section 220(1) of the Alberta Government’s Environmental Protection and Enhancement Act. Lessons Learned ENCON’s Environmental Liability policies will pay for “civil fines, penalties or assessments with respect to CLAIMS for BODILY INJURY or PROPERTY DAMAGE which the INSURED is legally obligated to pay”. This is part of the definition of LOSS in our wordings. In either of the two examples cited, it is likely that the defendants would have been entitled to coverage for the fines imposed upon them had they been insured with an ENCON Environmental Liability policy. Of course, coverage for government fines and penalties isn’t the only reason that a business owner should purchase environmental insurance. There are a myriad of complex legal issues, as well as regulatory and contractual requirements that are making environmental liability coverage part of the standard insurance portfolio that any industrial enterprise should carry. Knowing this, can you afford not to protect your business from the risk of fines and penalties from environmental infractions? For more information, please go to www.encon.ca or contact an underwriter in our Environmental department directly by calling 1-800-267-6684.

Marcus Raitanen is a Senior Underwriter at ENCON Group Inc. with over 14 years of experience in both the construction and insurance industries. RISKY BUSINESS MAGAZINE

SPRING 2013

The Most Unhealthy Spot in the Office Stuart Blair, Covey Basics

For this article, I thought I would share with you a story that is making its way through offices all over North America. This is a story that has aired on Extra TV about office health. Stuart You probably never imagined that your computer keyboard could be making you sick. But we went undercover to find out if keyboards could be contagious, and the results were shocking! They are right under our very noses and at the tips of our fingers, hiding invisibly inside computer keyboards millennium bugs, millions of dangerous germs that have become a health hazard of the information age, and as we discover in a special undercover investigation these critters aren’t fooling around.

Stuart Blair is a partner in Covey Basics with locations in Fredericton and Woodstock. As a dealer for Swingline Canada Office Furniture, Covey Basics works with office managers and administrators, promoting a safe and healthy work environment in offices around the province.

We secretly swabbed keyboards, sealed the swabs in cleaned tested tubes and sent a total of 20 samples to Universal Diagnostic Laboratories in New York for analysis. Lab supervisor Edward Elsaby says potentially dangerous germs were found on just about all the samples, but the worst were those from New York. At the Cyber internet Café we found streptococcus which causes colds and flu. At the Newark Airport there were germs that cause urinary tract infections. At the New York Public Library we discovered bacteria that cause sinus and respiratory ailments. But get this, at the News Bar we found bacteria which causes pneumonia- yes pneumonia! News Bar manager Beth Feldman was alarmed”. Now that I know this is going on, we can clean the keyboards 3 times a day and see if that will help.” What’s fallen out of your keyboard? Well, if it hasn’t been cleaned recently there will be visible things such as crisps and biscuit crumbs, hair, the odd finger nail and maybe a sprinkling of dandruff. But what about the things you can’t see? - Saliva. Every time you breathe, moisture is created and it settles somewhere! Even dead skin cells. Yes, afraid so. We all shed millions every day and where better to come to rest than in a computer keyboard. Body fat- Believe us, it’s true. Every time you type, touch a screen or telephone, the oil in your skin leaves a microscopic film. Just think what a few months’ build-up looks like under a microscope.

Computer keyboards have become a natural breeding ground for germs. A place where all of us drop food, spill drinks, and leave infectious bacteria for others to catch. Computer repairmen and cleaners have found everything from grease to animal hair, and Dr. Kelly Reynolds a Microbiologist at the University of Arizona even found bodily fluids while conducting a study for the Clorox Company. “We found that half of the keyboards we tested were positive for urine.” We decided to flush out these germs for our self, so we sent bug busters armed with hidden cameras and cotton swabs to public libraries, cyber cafes, airports, and public computer stations in New York, Portland, and Los Angeles. 24

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You may not mind having a collection of nasties in your keyboard if they belong to you - but what about when equipment is shared? Do you really want to collect body fat and saliva from someone else? Those most at risk of getting sick are the elderly, anyone with an open wound, or people with a weakened immune system. But doctors admit they have a lot to learn about this computer age peril. “We don’t really have numbers as to how often people can actually Get sick from contact with organisms on surfaces. But we do know that 75 million people contact bacterial illnesses each year, and 80,000 will die.” Credit for this article goes to Vision Global Media Group

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SPRING 2013

Business Insurance Coverage Checklist In addition to the usual coverage for your building, contents or equipment and general liability, the below checklist outlines some of the most commonly missed, and misunderstood commercial insurance coverages or clauses.

The Co-Insurance Clause or Penalty Every Policy Has One! What is it?

Pollution Clean Up or Liability

On your property? Or the neighbours?

Employee Benefits Errors & Omissions

You forgot to add an employee to the plan -and now he’s sick!?

Equipment Breakdown Coverage

If your business uses electricty – then you need to know about this.

Business Income

A claim has closed you for months – you still have payables and salaries.

Legal Expense

That employee you fired for stealing last month now has a lawyer.

Liability for “Non-owned Automobiles”

The new sales guy was in an accident on the way to see a client – he forgot to pay his car insurance.

Replacement Value vs. Depreciated Value

Even if I don’t rebuild – the policy will give me what it states won’t it??

Vacancy

Been months since those tenant’s moved out – my coverage hasn’t changed has it?

If your broker hasn’t already discussed the above with you – make sure you ask them. (Or – ask us!) Andrew Timmons atimmons@wclbauld.com 26

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Sean Murray smurray@wclbauld.com

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Legal Expense Insurance Minds the Gaps for Your Business For many Canadian entrepreneurs, running a business is a 24/7 prospect. They spend countless hours planning, marketing and developing the best products and services possible. But in these countless hours, entrepreneurs rarely consider the potentially catastrophic costs of unexpected legal actions. They’ve balanced their books, but how would they balance a wrongful dismissal suit? What about the legal fees that could be associated with licensing, tax audits or fleet operation issues? The last thing a business owner needs is a large and unexpected invoice for legal work, especially since the average hourly rate for lawyers across Canada is $360. The approximate cost of a one-day criminal trial is $5,000, while the average cost of a two-day civil action trial is a whopping $26,444. Fortunately, there is a solution for Canadian business owners to get peace of mind and affordable access to justice: Legal Expense Insurance. Relatively new to Canada, legal expense insurance covers legal fees incurred for various legal issues. A company might be facing a tax audit, a restaurant may need help retaining its business license, or a company might have to deal with an employee dispute. In cases such as these – or a host of others - Legal Expense Insurance provides

affordable access to legal counsel and ensures that the policyholder is able to navigate these challenges. “Legal Expense Insurance is filling the gaps in traditional insurance coverage and giving businesses peace of mind from unexpected legal fees,” said Barbara Haynes, CEO, DAS Canada – Canada’s only specialty legal expense insurer. “With our existing DASbusiness and new DAStransport policies we can now offer businesses comprehensive coverage all the way from the office to the open road.” Legal Expense Insurance gives business owners access to advice, representation and cost coverage. This type of insurance is common in Western Europe where about 50 per cent of people have some form of legal expense coverage, including personal and business coverage. The concept is relatively new to Canada but is catching on quickly with businesses across the country. “Perhaps the greatest benefit of a DASbusiness policy is having unlimited access to legal advice when needed,” said Haynes. “The ultimate goal is to limit the risk of doing business for companies that are too small to afford inhouse legal counsel. It provides them with peace of mind so they can focus their attention where it needs to be, on their business.”

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SPRING 2013

Commercial Insurance – Don’t Shop ‘til they Drop! Business owners are on a constant endeavor to minimize expenses and thus, increase their returns. Commercial insurance is one of those necessary expenses that businesses incur, and for which a business wants to decrease costs. However there are a couple of hazards or pitfalls that a business can fall into if they consistently “shop” their commercial insurance needs.

How “Market Burn Out” Occurs Multiple Broker Shopping Occurs when a business engages two, or more, brokers in soliciting quotes from various insurance companies. What many don’t realize is that there are a select number of insurance companies out there willing, or able (depending upon the nature of the business), for brokers to get quotes from. Nearly every insurance company will only give their quote to one broker – on a first come first serve basis. Most commercial

Essentially, there are two ways that a business can acquire alternative pricing for their insurance: 1) Multiple Broker Shopping, and 2) Internal “Remarketing” by a single broker. The biggest single drawback for both of these techniques, when employed too often, is what is commonly referred to in the industry as “Market Burn Out”.

Many businesses will request, or expect, that their insurance broker “shop” their coverage on an annual basis. 30

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Insurance Brokers share in common the majority of available insurance companies that can be approached for pricing. When multiple brokers are involved, it simply comes down to a “race for the fax machine” between brokers in order to get a quote. As a result, all the potential insurance companies multiple brokers are approaching are made aware of the annual insurance “shopping” habits of your business.

Steve Earle

Steve Earle, a graduate of Mt Allison Universtity, is Managing Partner - Business Development with WCL Bauld Insurance Brokers. Steve has a Canadian Accredited Insurance Broker (CAIB) Designation and offers 17 years in the industry with a background as Claims Adjuster, Commercial Broker and Marketing.

Internal “Remarketing” by a Single Broker

The Remedy

Many businesses will request, or expect, that their insurance broker “shop” their coverage on an annual basis. While in some cases this is automatically done by the broker, in other cases it isn’t – nor should it be. As with Multiple Broker Shopping, insurance companies become wary of requests for quotes they see every single year – and become less likely to be as competitive as they could be for fear of only losing the policy next year when it is remarketed again.

Choose one broker that is thorough and knows your business. One who takes the time to collect the information, update it annually, understand your exposures and can talk to you about the unique coverage your business may require.

When a business engages either of these techniques they may see some savings as result, for the short term. Providing a commercial insurance quote is a time consuming and labor intensive process for any insurance company. It can become difficult for a broker to convince an insurance company to provide a competitive quote when the insurance company has seen multiple requests year after year, from one or more brokers, with no success.

Trust in a broker who understands the market conditions and when it’s the best time to “shop” around for you – taking into consideration a multitude of factors including; a) the long term stability of the insurance company and their premiums, b) the claims service you’ll receive, c) the longevity of the businesses relationship with your existing insurance company, d) any other insurance you might have with that company which could be hard to get from another underwriter and, e) any other possible or unique repercussions to moving your account. Ultimately, a seasoned and professional commercial insurance broker will take their role seriously as your chosen advocate. They will weigh the variables and seek out alternative quotes on your behalf when the timing is right.

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