The Upstate of South Carolina has many displays of public art. One of my favorites can be found on Magnolia Street in downtown Spartanburg. Outside of the Extended Stay Headquarters is the self made man sculpture. It features a man carving himself from the stone. I see some important lessons when thinking about both individual and regional choices and the economic future of the Upstate.
Both as individuals and as a region we must consider what we want to shape from the current economic climate. There are challenges in communities around the world. If we desire a future that is different from the average, then we must make some choices that are different in our lives and in our region. The two constructive tools that we have to mold those choices are entrepreneurship and education.
Now is the time to consider your innovative and entrepreneurial temperament. Our Upstate South Carolina region is a great place for business. Maybe you should start one. The biggest barrier to most business ideas is a lack of detailed clear planning that shows an understanding of the proposed business. With a clear idea and a focused business plan you can expect a welcome reaction from an entrepreneurially inclined community.
As a region we must look at the building blocks available here that can support the emerging innovator or creative entrepreneur. We need to be seen as that entrepreneurially friendly business environment. Are we receptive to new ideas that don’t resemble the status quo? How do we treat failure? Many great entrepreneurs started and closed a number of businesses before getting the one that broke through. Consider an entrepreneur who starts and closes four businesses before creating thousands of jobs and making millions in venture number five. Were the first four failures or just the price of learning? As a business community how do we treat the entrepreneur on idea number three?
If the notion of owning a full time business is too far from where you are today, then consider some free lance activity or part time work that can generate income. The economy has moved toward a much greater reliance on contract and contingent work. What specialties or skills do you have that can provide some productive interim employment and income?
If you do not see yourself owning the business that directs the means of production, the next best alternative is to have the education and know how to be sought after by these entrepreneurs. Some strategic questions should guide your educational choices. One basic consideration is your long term goal and where you want to take your career. Are you in the industry or occupation that has the best long term prospects? If not what types of skills or retraining will you need?
Again like the strategic decision of the entrepreneur, the focus is on a personal choice as to what you will shape out of the opportunities in front of you. Economic downturns are great times to go back to school, pursue the next degree, or complete some missing training to make you a more productive effective employee. As a region we must be sure that the education and training is accessible and of high quality to attract businesses, produce results and generate prosperity. Entrepreneurship and education are two tools that will boost the region’s income in good times or bad. Part of our support for the business climate is producing the talent that can found or work in these emerging enterprises. Together the region’s future is shaped.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
The process of looking for a job is never easy or entirely comfortable. In the current economic climate searches are taking longer and the pressures seem even greater. If you are in that position, you need to develop a strategic approach for your next career step.
Scanning the want ads and sending out resumes is not the most effective tactic to find a job in the best of times. For many people the hardest part of networking during a job search is keeping the right attitude and energy level. The temptation may be to sleep late and catch up on the soaps until the economy turns around. However, the better opportunities will go to those who get out and work on their business skills. Advice to job seekers has for years emphasized the need to network and find the jobs that are unadvertised. Within your target industry there are circles of influence that can impact hiring when it does occur. Networking to become known is a first step.
The actual networking process today requires a combination of new school technology and old school face to face salesmanship. There are some tremendous web sites and technologies available that enhance communication and let you organize who you are in contact with. In many ways the high school students are better prepared than some professionals to tackle modern networking with a comfortable use of technologies. This can provide a rapid evaluation of who you know as well as who they know that you need to meet.
The generation just entering the job market may have embraced electronic networking but they did not invent the concept. The civic clubs, chambers, and professional organizations have all thrived for years and provided a consistent opportunity to meet and greet new contacts. The technology will speed the process and may help you identify someone who can give you an introduction, but ultimately a personal meeting is more important. For networking to be effective you must become a known as a professional with useful skills and be seen as a desirable colleague.
Remember you want to display enough positive energy to convince them you would be an asset in any company. Avoid any external blame or pessimism. People who are bitter or angry don’t make good colleagues and those attributes will not attract referrals. You will always get further if people believe you are focused on the future not the past. Knowing that a meeting with someone of influence will not generate a job offer does not reduce the value of the meeting or the need to make a good impression.
Networking is very similar to interviewing but without the stress of rejection. In fact you may get more positive feedback. In a networking interview you are more likely to hear someone say they would consider or hire you if they had a job. Without the constraints or competition of a real search the person you are meeting with may be more comfortable talking freely.
Of course one of the goals from networking is to build a referral base so you can compete when a job becomes open. If they suggest someone else that would be a good referral set up the appointment immediately. Prompt, courteous and effective communication is always important. These traits are the same attributes expected of a top employee.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
Email has done a great deal to improve rapid communication in business. However, rapid communication is not always the most effective. A real operational challenge for many in business is to decide how much to rely on email and when other forms of communication are needed.
The type of mistakes you make using emails depends in some part on what other communication you were used to. For workers who grew up with letters and memos, there is a tendency to think that email is just another way to distribute the same communication. However, email lacks the personal impact of a letter and longer emails are often not read.
If an email contains a single or focused topic it can be read and handled. When it contains a laundry list of issues it sits in the inbox. In fact, often it is easy to avoid dealing with any of the issues in an email unless you are ready to deal with all of them. Alternatively, if you only respond to one or two items, the remainder risks becoming lost as the thread of communication moves away from the original topic.
Many workers have their email inbox filled with hundreds of emails that they are afraid to delete and lack a system to file. A simple distinction is to separate those emails that provide information from those that document the thread of a decision and those that require a response or action. The informational email belongs in a folder where it can be retrieved. Reserve your inbox for those that require action. If you have emails in your inbox several weeks old, either you are way behind in your work or your filing system is faulty or both.
One important characteristic of emails is that it is incredibly easy to copy others or forward a conversation. Copying too many people on the details of a decision can make even the smallest organization seem bureaucratic. Some experts recommend always writing the email first and filling in the addresses last. That way you can stop and think about whether each really needs to be on the list.
You should never presume that your email stops with the person you contact. For that reason some discussions need to move quickly from emails to face to face meetings. This is particularly true when disagreements are being handled.
Email is a limited form of communication. It is much better at conveying anger and frustration than discovering the source of disagreement. When angry emails start being copied to others it is inevitably the sign that at least one party wants to document the disagreement and prove they were right. For those who received unsolicited copies only part of the story is present and the practice is more likely to inflame than inform.
For the newest generation of workers the challenge is to remember that others may see email as a formal means of communication. Complete sentences, grammar and spelling all are still important in emails. For those used to the casual abbreviations of text messages it is a constraint to take this time and care with “just an email“. Your more experienced colleagues may not speak text. Not only is a text message less intelligible to them, it is also potentially offensive for someone who is not also a casual friend.
Remember that the purpose of email is communication. You need to consider your audience and how they will be able to understand and process your intentions. Most importantly, the time to take extra care with your business email is before you click send.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
The turn of the seasons can be marked in many ways. As reliable as the changing weather or the passing of holidays, summer consistently sees the upward movement of gas prices along with the accompanying complaints and frustration to drivers.
As the summer begins we are once again seeing higher prices at the pump. Although there has been significant movement in the last few weeks, the expectation is that we will not see the same lofty heights reached last summer.
Last summer the movement of gas prices to over four dollars a gallon was associated with a natural drop in other consumer spending. In fact the pressures that consumers faced in adjusting to the associated higher transportation costs are considered by many to be a causal factor in the current downturn. Very simply for many overextended consumers the higher price at the pump represented the extra expense that just could not be absorbed. Reduced discretionary spending by all consumers squeezed businesses across the board and the defaults of those strapped the worst were sizable enough to damage the lenders.
When the economy sharply dropped toward the end of last year gas prices fell as well. The reduced global demand lowered pressures on energy costs. On the positive side, the lower price at the pump helped consumers get a handle on their budget and established a new floor for spending in the economy.
The economic movements this year will be watched very closely. At this point the data suggests that we will see some rebound in travel over the summer and that gas prices can be expected to climb. For South Carolina a big increase in summer driving would be welcome news. Our beaches and tourist destinations enjoy the benefit of driving holiday destinations and road trips. However, the magnitude of the increase is well below recent years, so our benefit is likely to be less.
According to government energy statistics at the first of June, average retail gas prices had climbed to over $2.50 a gallon. While this is a sizeable movement over the prior month it is $1.45 below last year. Similarly crude oil prices had moved over $66 per barrel at the end of May, but that was $61 per barrel lower than last year.
The dynamics of the movement in gas prices are consistent with the change in inventory of gasoline. As recently as mid-April total gas stocks stood at 217.3 million barrels above the historical average range. By the end of May stocks had fallen to 203.2 million barrels below the average range. By comparison one year ago these stocks were greater and stood at 209 million barrels in an environment where prices were much higher.
Since driving has been reduced with the economic slowdown the inventory in terms of days supply is more stable. This year’s level represents a 22.1 day supply of gas versus 22.5 day supply last year. However, if the economy and summer driving rebounds sharply expect severe pressures on gas inventory.
When we see unambiguous signs that the world economy is improving, then energy prices will be one of the first to reflect the change. The long term pressures that were pushing prices higher will quickly return when global growth resumes. We can not afford to become complacent believing that the market forces that changed our driving habits last year have been repealed. The downturn has merely given us a short break at the pump. Plan for the future expecting a return to high gas prices.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
What shape will the economic recovery take? The economic forces that are building combined with the political incentives facing policymakers make a return to stagflation a leading scenario.
For those too young to remember the late seventies, stagflation is a combination of economic stagnation and inflation. Traditional macroeconomic thought did not expect stagflation prior to its emergence in the Carter years. Typically the most significant volatility in the economy is in aggregate demand. Historically, periods of stagnation or recession are associated with lower aggregate demand and periods of inflationary pressures are associated with an over stimulated aggregate demand. In the sixties some economists even speculated we would reach the point of fine tuning economic policy to manage the tradeoff between periods of unemployment and inflation. Then, during the late seventies slow economic growth with persistent high unemployment while at the same time the economy suffered from rising prices and inflation.
In order for stagflation to occur there must be some dampening effects on production and aggregate supply within the economy that will limit the ability of growth to take place. At the same time there must be a simulative monetary policy to feed the inflationary environment. A single supply reduction may cause prices to spike, but inflation results when too much money chases too few goods and is ultimately evidence of a continuing monetary policy misstep.
The potential for economic stagnation and slow growth is a direct result of an increased presence of federal government involvement and regulation in the economy. These types of policies slow the ability of the economy to adjust and lower growth rates. However, the focus of this column is on the question of how an inflationary spiral can be expected even though monetary policy experts understand the threat is a result of current policy. It is not a result of malfeasance or even an underestimation of the risks of inflation. Rather the dilemma emerges from a constrained set of policy options in a highly political environment.
Right now the focus of monetary policy is the massive injection of reserves into the banking system and the use of monetary policy to accommodate the deficit spending at the federal level to maximize the economic stimulation. The major complaint is that the funds injected into the banking system are sitting as excess reserves and not being lent out. As long as the funds are in reserve they are not building inflationary pressure.
Once the economy starts to recover the reserves would need to be rapidly drained from the system in order to prevent inflation. The risks to the federal reserve are that being overly aggressive in fighting inflation when the economy starts to recover can force trigger a deeper recession. Moving slowly allows a round of inflation.
A similar dilemma faced policymakers in 2004. The consensus is that they were too slow to change course and stimulated too long. One challenge is learning to correctly read the economic tea leaves and recognize that the time is right. Even though the policymakers may have learned from that experience and be more accurate in anticipating the timing, the political constraints may not allow a different outcome this time. The downturn we are currently experiencing is severe and will likely be the source of studies for years. Against the current economic backdrop, policymakers have an incentive to err on the side of inflation rather than recession. Inflation is a serious problem, but it is also an improvement over last year‘s economic problems. That makes its recurrence more likely.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
One of the interesting reactions to witness during the economic downturn is the way different companies handle customer service operations. Finding and keeping satisfied customers is the heart of any business. You can think of long term profits as reflecting the customer's perception of the value added or contribution of the goods and services a business produces.
Customer service is an important part of the business process any time. However, during an economic downturn different companies respond very differently in the investment and attention that these operations receive.
For the small business and in particular the owner operated business, customer service operations typically receive more attention during a slowdown. During periods of growth and expansion many smaller operations struggle with the transition to create a separate team of individuals that can handle service calls, sales and product representation, or effectively communicate with the customer about a variety of needs. During a slowdown the same small company owner may make the call or they only retain the most experienced personnel. As a result calls are answered faster with more personal service and a clearer understanding of where the business can add value. It is refreshing to call for quotes or to price a job and have the owner schedule a quick personal visit. In today’s economy many small businesses are hungry and their extensive commitment to customer service shows.
On the other hand the opposite treatment of customer service can occur with larger companies. Call centers are seen as a cost with only an indirect link to product sales. Staffing of frontline customer positions in services and retail have been cut back. As a result waits can be longer and the staff more likely to be overloaded. Training is often curtailed as a non-critical expense.
These cut backs can have the unfortunate consequence of reducing the effectiveness and expertise that the customer receives at the time when the market is most competitive. For example, in home service customers are often given the four hour window. Someone should be by between noon and four o’clock. If you can’t schedule 4 hours to wait for service then it is seen as your problem not theirs. Call centers are understaffed. That means that wait times are extended. Recently after spending 45 minutes on hold trying to make a purchase I was wondering why I wanted the product.
Another attempt to cut costs involves trying to drive customer service to the web where they can take care of themselves. After signing up for a rebate on a web site I was fortunate enough to be given the opportunity to participate in a satisfaction survey. The fact that the first question asked whether I had been successful in completing my task did not surprise me and reveals that a significant number of customers couldn’t.
Retailers have their own version of training issues. The sales associate who discourages sales by loudly telling the customer that the product is not marked on sale and the advertisement was misread, somehow seems unfazed when the computer rings up the sales price anyway. If sales representatives cannot answer basic questions about promotions displayed on in-store signs, then basic product training has been cut too far.
As the economy works its way back from the downturn companies will face the consequences of their choices for investing in customer service. Those that recognize the value of their customer’s time and patronage will have preserved their reputation and be positioned to expand their markets when growth resumes. I hope that is where customers find your company.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
Fun, Games, and Building a Community
The BMW golf tournament is a fun opportunity for our region. First, the region gets to see a top quality event with celebrity visitors in the area. Second, the BMW commitment through the event provides an outstanding boost that benefits local charities. Finally, the level of attention that the tournament attracts also gives an opportunity for others around the world to see and reconsider their impressions of the Upstate of South Carolina.
The regional marketing campaign that is sponsored by the Upstate Alliance gets lots of air time during the tournament. These are the advertisements based on theme, "I was blown away." The campaign includes television ads, and a web site, www.iwasblownaway.com. Each features testimonials to the amenities of the Upstate.
Regional marketing campaigns are not themselves that unique. Years ago the state department of commerce would run January and February ads in cold and snowy climates showing beach scenes and encouraging relocation. Locally the Upstate Alliance was created with a mission to market the region so we can compete for business investment globally. Raising the visibility of our area is a necessary step toward that goal.
When you listen to the ads or read through the testimonials, it is clear that there is something at work here besides the traditional bragging about our business climate and quality of life. The theme suggests not just that visitors and newcomers have an experience that exceeds what they expect. They also tackle the question that maybe those expectations were wrong to start with.
This is certainly a problem that I can relate to as a long time professor. In teaching the most difficult challenge often isn't the most complex topic. Instead it is the topic where the student thinks they know the answer or how to solve the answer, but what they think up front is wrong. Before you can successfully move on to teaching what is needed, you must first help them see the flaws in what they originally thought and unlearn those initial incorrect ideas.
In the case of people looking at investing in South Carolina the challenge is that we do not know all the stereotypes and biases they are bringing when they visit. For example, growing up in the Carolina Mountains I always enjoyed watching the Beverly Hillbillies or seeing Andy and Opie in small town Mayberry. At the time I thought they were just television comedies and never realized the extent to which expectations for our region were being influenced. It is not just that people in other regions don't know about the opportunities in the upstate. The challenge is that much of what they think they know isn't true.
The testimonials featured by the Upstate Alliance cover quality of life topics like fine dining and health care. They also cover basic business interests like entrepreneurship and doing business in the upstate. Each testimonial supports that yes the region has much to offer but buried in the comment is the story that initial expectations were wrong.
A final feature that is unique to this marketing campaign is its potential to grow and expand. The web site has opportunities for new testimonials to be added. If you came to the region and were pleasantly surprised by what you found, you can help us tell others. Or perhaps if you find that out of town customers express surprise in the quality of your business, maybe you should try and get your story into the campaign. There is more to the Upstate of South Carolina than outdated stereotypes and television reruns.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
In early April, I joined 375 others at the Carolina First Center and spent the day placing toy bricks on a map of the Upstate. The event was sponsored by the Urban Land Institute and is supposed to give participants a regional perspective on how growth can emerge in coming years. The variety of press that followed is targeted to heighten the awareness of the regional challenges that must be faced.
The data used to drive the exercise was the conservative estimate that the ten counties of the Upstate will be adding 118,000 households and 203,000 jobs by the year 2030. The region is attractive and growing. There are a lot of competing visions as to how much of that growth lands in each community.
The entire focus was on the patterns of growth that could occur. The urban planning professionals were focused on whether the alternate patterns more closely represented a corridor development expanding on existing roads, a compact development in the city centers, or a rural village pattern supporting small towns. Our region and every map appeared to have elements of all three.
The transportation network defines the economic strength of the Upstate. The Interstate 85 corridor makes this region the connection between Charlotte and Atlanta. Interstate 26 gives access to the port in Charleston. Rail and air give a variety of choices to send cargo to the rest of the world. The companies that will either choose to locate here or grow and prosper here are influenced by this basic infrastructure.
Quality
of life is another influence that draws economic growth. We are only
the type of region that is attractive if we value our cities and
smaller towns. Basically our urban centers must have the amenities
and jobs that people who live in urban areas expect. The variety of
small towns will only prosper if they have goods and services on Main
Street with a combination of jobs and households in town centers. The
Upstate growth patterns must reflect all three realities.
Several
important realities were not on the table. First all jobs were treated
equally. The basic opportunities are going to be different in each of
these pieces of the pattern across our region. The question is not a
matter of good jobs versus bad jobs. The question is instead “what
will we produce and create that adds value?” How does that change
given the locations we are considering? A more focused question might
be, “to what extent does growth comes from expanding existing
companies, recruiting new companies or building new companies in this
region?”
The
emerging enterprises and entrepreneurs have the most potential. As
business changes many of the jobs that will be present in the year 2030
are in industries and occupations that do not exist yet. The surest
way to have high quality jobs is to support emerging entrepreneurs.
Innovation and entrepreneurship have their own infrastructure
requirements. If we want to see companies growing in this region that
engage in high value added productivity, then we need to foster and
nurture that type of innovation.
There
is a lot of work that occurs between having a new idea and getting the
business to profit in the marketplace. Entrepreneurial education is as
much an infrastructure need for the Upstate's economic development as
roads, rails, water and sewer. If we have talent educated in how to
develop and run small businesses then this region can build its future
prosperity as a place to build and prosper for innovative high impact
entrepreneurs.
Darrell Parker, Ph.D., is Dean of the George Dean Johnson Jr., College of Business and Economics and Professor of Economics at USC Upstate. The USC Upstate Johnson College is accredited by AACSB International (The Association to Advance Collegiate Schools of Business). He can be reached at dparker@uscupstate.edu.
Recent Comments