USDA Announces $150 Million Investment Fund for Rural Businesses

The U.S. Department of Agriculture has announced a $150 million fund the agency will use to invest in small rural businesses. The fund establishes a new Rural Business Investment Program with a new wrinkle for investment in rural ag-related companies.

The new investment fund was announced as part of the Obama administration’s “Made in Rural America” initiative. Agriculture Secretary Tom Vilsack said the money will go to “innovative” rural small businesses with an emphasis on those with job creating potential.

Vilsack told ABC News examples of such businesses might include small biotechnology firms, businesses creating ag-related products for export and regional food hubs. (So this isn’t necessarily money going to investment in small family farms here.)

Small agricultural businesses can already access funds through loans and loan guarantees from the USDA. But the agency says the  new fund will allow “cutting-edge” businesses to access equity investment funds, too.

In a statement announcing the fund, Vilsack said:

“One of USDA’s top priorities is to help reenergize the rural economy, and we now have a powerful new tool available to help achieve that goal. This new partnership will allow us to facilitate private investment in businesses working in bio-manufacturing, advanced energy production, local and regional food systems, improved farming technologies and other cutting-edge fields.”

The money will be managed by a private firm, Advantage Capital Partners, and will come from eight designated Farm Credit banks. These banks are part of the national Farm Credit System, a federally sponsored group of lenders to farmers and other ag-related businesses.

The money will be invested by the newly created privately owned USDA licensed Rural Business Investment Company.

Some critics are understandably skeptical of the “Made in Rural America” initiative. They say it promotes export of food items that the U.S. already imports in large quantity. Critics argue the initiative has also not really benefited small farmers, ag-related businesses or the consumer.

Journalist Brett Barth reports at The Cornucopia Institute blog:

“The prime beneficiaries of global trade aren’t farmers but corporate middlemen, the distributors, transporters, and traders who take a combined profit of over 90 percent of every food dollar. With such a large combined profit at stake, trade-for-the-sake-of-trade has become an economic engine that drives worldwide agribusiness to needless and illogical ends.”

Image: Wikipedia

Google Is Growing at Double Digits But Wall Street Still Isn’t Happy

Google is growing at double digit rates, and if that were your company, you’d likely be thrilled. Apparently, Wall Street investors are not. Such is the fickle favor of Wall Street.

The search giant’s first quarter earnings report shows an overall increase in revenue. Earnings rose from $12.95 billion in the first quarter of last year to $15.42 billion in the first quarter ending in March 2014. That’s a year to year increase of 19 percent in revenue.

So, who wouldn’t be happy with this kind of growth? Investors!

Immediately after a call delivering the company’s quarterly earning figures, they started selling stock causing a 5 percent decline in market share. Within 24 hours, the stock had lost $9 of value per share, Business Insider reports.

The reason, from investors’ perspective, is simple. A report from Asymco, a analytics company dealing largely with technology issues, says the growth of the Internet, in terms of the numbers of people still getting online, is slowing.

So, fewer new people coming online means fewer new customers or revenue possibilities for Google.

From a small business perspective, however, the earnings report seems like good news.

The revenue Google earned from its online advertising grew again this quarter. The company reported site revenues of $10.47 billion, up 21 percent from $8.64 billion in the first quarter of 2013.

The company also increased the share of revenue it paid to independent sites running ads from Google’s advertising network. This includes small websites that run Google AdSense and share in the revenue when their visitors click.

But while the amount of money spent on Google ads overall keeps increasing, an apparent indication that the ads are effective, the cost per click has decreased compared to last year. According to the quarterly earnings report, Google saw a nine percent decrease in cost per click on Google ads compared with the first quarter of 2013. But the cost stayed fairly constant since last quarter.

This means that while Google Ads make more and more money for those running them (and for Google), it is costing advertisers less per click to buy them.

Google Photo via Shutterstock

More in: Google

Talk About Bad Company: The True Cost of a Bad Hire

Hiring the wrong person for a position is an expensive mistake for a company to make. In a recent Career Builder survey 42% of companies reported that a bad hire cost them at least $25,000 in the past year, and 25% reported a loss of at least $50,000.

But for small companies, where every employee often juggles many important responsibilities, the cost of a bad hire can be even more devastating - up to $190,000 according to a report by Association of Certified Fraud Examiners.

The Cost of a Bad Hire

Besides of the direct costs like salary and benefits, ill-fitting employees also rack up indirect costs in lost productivity and the eventual need to recruit and hire a replacement employee.

These employees also require more supervision; CFOs reported that supervisors waste 17% of their time managing under-performing employees. That’s almost a day a week.

Additionally, 95% of those polled reported that a bad hire negatively affects workplace morale. In small companies, a bad employee can easily poison the working environment for everyone.

To avoid hiring the wrong person, there are several crucial steps you should take before you commit to hiring.

Keep Your References Close

In the aforementioned Career Builder survey, 21% of companies admitted that they hired poorly because they didn’t take the time to properly test and research the employee’s skills.

While almost all companies interview before hiring, potential employees tend to inflate their abilities and present their most polished selves during these sessions, so they are not the best indicator of what an employee will actually bring to your company. Resumes, which job seekers structure and write themselves, tend to be even less indicative of future performance.

David Goldberg, CEO at SurveyMonkey advises:

“Let resumes and interviews be used to reject candidates but rely on real references to hire people.”

References can give you real insight into your job applicants. While some former bosses will be reluctant to give extensive information for fear of being sued, they will usually be willing to at least tell you the person’s employment dates, rates of pay, and work habits (including their ability to work with others). You can also check the validity of the skills and experience the potential employee claimed to have during the interview.

The most important question to ask former employers is, “Would you rehire this person if the opportunity arose?” If the answer is no, then it might be time to pass on this candidate.

Be Proactive

Don’t just wait for the perfect employee to come to you - go out and look for them.

Figure out where your top candidates are likely to be spending their time, whether that’s a certain conference, trade show, or even a niche interest group and spend your time there too. Allyson Downey, the CEO of weeSpring, also advises companies to keep a ready supply of potential employees always at hand:

“I keep a pool of names in a database of people I’ve met that I’d like to work with someday. We’ve found it 100x more reliable than a resume screen â€" it’s like Moneyball for hiring.”

But if you don’t know of the perfect employee already, there are still ways to attract the right talent. Make sure your listings are descriptive, clear, and include the position’s day-to-day tasks, salary, and any necessary skills the position might require. You also want job seekers to get a good sense of your company’s corporate culture, so that they know whether or not they’d be a good fit before applying.

For example, many small businesses require their employees to inhabit many shifting roles within the company, so it might be a good idea to emphasize the need for flexibility and adaptability.

Kick Those Tires

It’s almost impossible to know how an employee will work within your company until he or she is actually placed into that environment. That’s why it is often a good idea to hire a top candidate on a temporary basis before fully committing.

Put them in charge of a test project or let them work on an existing project in a reduced capacity. This will allow you to accurately assess the candidate’s skills, and see whether or not they work well with your team.

While many small businesses may feel like they need to fill a position quickly, it pays to take the time to fully vet applicants or seek out better talent. It’ll save you a lot of money and headache in the long run, and make your company a happier and more productive place to work.

Frustrated Photo via Shutterstock

“Boards That Lead” Identifies When to Partner, Take Charge, or Get Out of the Way

“Boards That Lead” Identifies When to Partner, Take Charge, or Get Out of the Way

Many books address operations, customer service, and how employees should work together. Yet there is a significant activity that does not get a fair share of print - or with e-books these days, a fair share of pixel. Selecting highly educated professionals to be board members. Many organizations flounder because board members are selected from …

Content

Usefulness

Freshness

89

Summary

Boards That Lead examines how boards can take charge, partner, and prevent micromanagement by examining typical tasks closely.

89

Many books address operations, customer service, and how employees should work together. Yet there is a significant activity that does not get a fair share of print - or with e-books these days, a fair share of pixel. Selecting highly educated professionals to be board members.

Many organizations flounder because board members are selected from ego rather than practicality with respect to the organization.  Others flourish from selected board members whose participation improves the value of organizational resources.

How Does an Organization Make the Best Choice?

One book that reveals the right wisdom to the board selection process is Boards That Lead: When to Take Charge, When to Partner, and When to Stay Out of the Way.

The book was written by three of the foremost business leaders today.  I am most familiar with Ram Charan, author of Execution and other business books. He joins experts Dennis Carey and Michael Useem in outlining the significant processes that make an effective corporate board.

Boards That Lead is divided into three sections. The first delves into establishing functional boards, thus the title Boards That Lead. The second, Leading the Leaders, examines how boards work with an executive team.  The last section, Value Creation, identifies the activities that create the most utility for an organization’s benefit.

The book material is designed to permit readers to imagine multiple combinations of direct and collaborative leadership. Increased enterprise complexity calls for these varying degrees of oversight.  A summary image shown below captures the aspects of how a board leads, partners, monitors, and delegates:

Each chapter examines these aspects with a “director’s checklist” to ask critical questions within your own context.  For example, one chapter asks you to know the purpose for why your organization exists. Recruiting a director? Eight questions ask what makes a good fit.

The specifics in Boards That Lead offer compelling views of the complexity of being a board member. There are great perspectives for new board members, such as the litigation that has arisen over board obligation:

“….Investor demands for more independent boards that would be accountable to them, paid like them, and fiduciaries for them gave rise to litigation….the legal actions did help establish two standards for director obligation: Duty of care, requiring directors to exercise reasonable caution in executing board responsibilities that could harm others if not performed well, and duty of loyalty, requiring that directors exercise good fiduciary judgment on behalf of the stockholders.”

Overall, Boards That Lead examines how the boards can take charge, partner, and prevent micromanagement by examining the typical tasks.  While reviewing the text, I got a good impression that the authors really worked at striking a balance between honoring their real-life experiences and providing examples that reasonably acknowledges their counterpoints as much as their advocated points.

For example, that previous quote follows the famous example of bringing Steve Jobs back to revive Apple.  The authors detailed Jobs’ requests with Woolard, a director who noted that partnering with the right CEO was important.  Yet the authors also periodically note how a board can be to blame for a company’s failure:

“When (Ram Charan) subsequently taught a business case on Apple, executive program participants almost always blamed the firm’s decline on poor leadership in the corner office. But on our view, it was the board that had recurrently selected the wrong CEOs for the office - in effect, the chief executives were dead on arrival. A solid pedigree from past performance had made them attractive managers, but their skill set proved a poor match for the triage they actually had to perform.”

The authors delve into other examples of well-run and challenged boards including publicly-traded companies such as Lenovo, Delphi, and Infosys.  In each example, the authors show the results from responsibilities that can be taken by boards as well as the one best left to executive management.

Further reading is possible with the text, with a detailed appendix. Furthermore, I can see Boards That Lead being an aid for experienced start ups looking to add board oversight to their activities. Combine this with a book on venture capital such as David Capstone’s Venture Capital Investing which I reviewed a few years ago.

Read Boards That Lead before considering a board for your organization.  Doing so can establish the most resourceful leadership for your organization.

“Boards That Lead” Identifies When to Partner, Take Charge, or Get Out of the Way

“Boards That Lead” Identifies When to Partner, Take Charge, or Get Out of the Way

Many books address operations, customer service, and how employees should work together. Yet there is a significant activity that does not get a fair share of print - or with e-books these days, a fair share of pixel. Selecting highly educated professionals to be board members. Many organizations flounder because board members are selected from …

Content

Usefulness

Freshness

89

Summary

Boards That Lead examines how boards can take charge, partner, and prevent micromanagement by examining typical tasks closely.

89

Many books address operations, customer service, and how employees should work together. Yet there is a significant activity that does not get a fair share of print - or with e-books these days, a fair share of pixel. Selecting highly educated professionals to be board members.

Many organizations flounder because board members are selected from ego rather than practicality with respect to the organization.  Others flourish from selected board members whose participation improves the value of organizational resources.

How Does an Organization Make the Best Choice?

One book that reveals the right wisdom to the board selection process is Boards That Lead: When to Take Charge, When to Partner, and When to Stay Out of the Way.

The book was written by three of the foremost business leaders today.  I am most familiar with Ram Charan, author of Execution and other business books. He joins experts Dennis Carey and Michael Useem in outlining the significant processes that make an effective corporate board.

Boards That Lead is divided into three sections. The first delves into establishing functional boards, thus the title Boards That Lead. The second, Leading the Leaders, examines how boards work with an executive team.  The last section, Value Creation, identifies the activities that create the most utility for an organization’s benefit.

The book material is designed to permit readers to imagine multiple combinations of direct and collaborative leadership. Increased enterprise complexity calls for these varying degrees of oversight.  A summary image shown below captures the aspects of how a board leads, partners, monitors, and delegates:

Each chapter examines these aspects with a “director’s checklist” to ask critical questions within your own context.  For example, one chapter asks you to know the purpose for why your organization exists. Recruiting a director? Eight questions ask what makes a good fit.

The specifics in Boards That Lead offer compelling views of the complexity of being a board member. There are great perspectives for new board members, such as the litigation that has arisen over board obligation:

“….Investor demands for more independent boards that would be accountable to them, paid like them, and fiduciaries for them gave rise to litigation….the legal actions did help establish two standards for director obligation: Duty of care, requiring directors to exercise reasonable caution in executing board responsibilities that could harm others if not performed well, and duty of loyalty, requiring that directors exercise good fiduciary judgment on behalf of the stockholders.”

Overall, Boards That Lead examines how the boards can take charge, partner, and prevent micromanagement by examining the typical tasks.  While reviewing the text, I got a good impression that the authors really worked at striking a balance between honoring their real-life experiences and providing examples that reasonably acknowledges their counterpoints as much as their advocated points.

For example, that previous quote follows the famous example of bringing Steve Jobs back to revive Apple.  The authors detailed Jobs’ requests with Woolard, a director who noted that partnering with the right CEO was important.  Yet the authors also periodically note how a board can be to blame for a company’s failure:

“When (Ram Charan) subsequently taught a business case on Apple, executive program participants almost always blamed the firm’s decline on poor leadership in the corner office. But on our view, it was the board that had recurrently selected the wrong CEOs for the office - in effect, the chief executives were dead on arrival. A solid pedigree from past performance had made them attractive managers, but their skill set proved a poor match for the triage they actually had to perform.”

The authors delve into other examples of well-run and challenged boards including publicly-traded companies such as Lenovo, Delphi, and Infosys.  In each example, the authors show the results from responsibilities that can be taken by boards as well as the one best left to executive management.

Further reading is possible with the text, with a detailed appendix. Furthermore, I can see Boards That Lead being an aid for experienced start ups looking to add board oversight to their activities. Combine this with a book on venture capital such as David Capstone’s Venture Capital Investing which I reviewed a few years ago.

Read Boards That Lead before considering a board for your organization.  Doing so can establish the most resourceful leadership for your organization.